PM-CCMS and Raytheon Teaming for Success

1. Improved Target Acquisition System Contractor Logistics Support PM-CCMS and Raytheon Teaming for Success

2. ITAS Contractor Logistics Support One for One Replacement of the Ground TOW 2 (M220A2) System Modified ITAS (MITAS) Supported By CLS Provided by Raytheon, McKinney TX

3. System / Customer Overview A Support Challenge!!! 4 CLS Supported LRUs • TARGET ACQUISITION SUBSYSTEM INTEGRATED SIGHT • 2nd GEN FLIR Detector (w/Monitor) SADA II • Laser Range Finder • Direct View Optics • FIRE CONTROL SUBSYSTEM • Embedded Training Cards • Missile Guidance • BIT/BITE • TRAVERSING UNIT MODS • Brake • Pistol Grip • New TAS Mount • Ground Mounted w/Tripod • POWER SUPPLY / BATTERY BOX • Dismounted Power • Power Conditioning • Built-In Battery Charger • ITAS Designed to Improve Performance • CLS Designed to Increase System Availability and Reduce Ownership Cost • The “Light, First to Fight” Army: 82d Airborne, 101st Airborne (Air Assault), 25th Infantry Division (Light) (Hawaii), 2ID (Korea), etc. • Rapid, Worldwide Deployability - 18 Hours “Wheels-Up” • Forced Entry Capable, i.e. Fight Their Way in • Limited Support, Arriving 3-5 Days Later

4. ITAS Reduces Support Footprint and Cost 18 LRUs 6 LRUs TOW 2 ITAS No IFTE Van or Any Other Support Equipment For ITAS

5. Field Level Maintenance Military / Contractor Partnership CLS Execution – A Team Effort Infantry Battalions Support Battalions /Forward Repair Activity Raytheon Depot • Agreements • RSC / PMO CLS Concept (Later Turned Into Contract) • RSC / Unit / PMO For Duties and Responsibilities • PMO / LOGSA For STAMIS Interfaces

6. Contractor Not Required On Battlefield, Deploys Per Commander’s Guidance ITAS Contractor Logistics Support • Support Goal: To Improve System Availability While Reducing Support Costs • Accomplished By Contracting With the Prime Contractor For: • Operational Readiness (OR) • Minimum 90% • Incentivized for Greater Than 90% • Penalized For Less Than 90% • Free Issue of Repair Parts to Units • Limited Depot Level Maintenance Facility Collocated With Units • Separate Options for Contingencies and Transition to Follow-on Source (NTEs Provided) CLS Provides High Operational Readiness (OR)

7. Fixed Price - Performance Adjustment 100% 95% 90% 85% 80% Operational Readiness = Profit Profit Plus Maximum Performance Adjustment + $ Profit Plus Minimum Performance Adjustment Minimum Profit • Additional Metrics to Prevent “Gaming” • Separate Metrics for Contingency Options – $

8. Fixed Price Portion of Contract $$$ $$$ Price per System Total Price per Year $ $ Contract Price FY00 FY01 FY02 FY03 FY04 FY05 FY06 Price per System per Year • Incentives: $$$$ • Fixed Price Contract - Contractor Incentivized to Improve Quality, Efficiency, and Performance. • Operate, Smarter, Better, Faster, and Cheaper. Result = Contractor Profit • Performance Adjustment for Exceptional Effort • Future (Potential) CLS Customers (SBCTs, USMC, FMS) • 5 Year Effort CLS 5 Year Contract Strategy

9. Government Challenges • Funding (ITAS CLS Is Not In AWCF) • PMO Experience With Different Colors of Money • Budgeting / Funding Process (End of Year, Incremental Funding , Etc.) • Budgeting for Surprises (Fielding Schedule Changes, Contingencies, Etc.) • Funding Cuts (Contract is Must Fund or ???) • Contracting • CLIN Structure For Tracking Different Colors of Money • Long-Term • How To Incentivize Contractor • Contractor on Battlefield Issues • Information System Interfaces • Post Production Support (Affordability)

10. Contract Objectives, Challenges & Solutions

11. Supporting the Soldiers Incentive Based Contract Reducing Product O&S Costs Raytheon Contractor Logistics Support Objectives • Product Support through System Life • Cradle to Grave • Teaming with the Program Office • Long Term Contract • Technology Insertion via Product Support

12. Raytheon Challenges • Issues beyond our control • Optempo affecting number of failures and spares • Damage vs failures • Contractors on the Battlefield • Commitment to meet or exceed Operational Requirement • Interface to Army supply system • Moving from T&M type contract to Incentive Based contract • Lack of database information on “OR” • Measurement of “OR” OR> 90% Support the Soldiers on the Battlefield

13. Approaches to Success • IPT created with approach as partners • ALPHA Contracting method for: • Development of SOW • Negotiation of a 5-year CLS contract • Agreement between the Tactical Units, PM-CCMS and Raytheon • Integrated with the Army as one team to support the system • Solid, definable metric that benefits the Soldier, PM & the Contractor: “Operational Readiness” • Commercial solution to supply and asset management

14. Keys to Success • Army/Raytheon Teamwork • Government sharing of information • Funding Issues/Profiles • Continuous dialog on fielding status • Program/Tactical Unit Objectives • Funding as required to support readiness • Agreed-to-requirements form a successful Army/Contractor team • Flexible contract CLIN to adjust for changing world conditions

15. Exceptional Results OR at 100% 24 months 250 100 225 90 200 80 175 70 150 60 OR % Quantity 125 50 100 40 75 30 Deployments & Training Ops 50 20 Operation Enduring Freedom MC02 JRTC NTC 25 10 0 0 1/17 CAV 505 PIR 504 PIR SBCT 3/2 ID 325 AIR 1/503 INF 1/506 INF 2 ID Korea 1/327 INF REG 101st 82nd Airborne Cumulative Quantities Operational Readiness