WorkOut is a change management methodology developed by C.A. Schifman and Company in 1986 that engages employees at all levels of an organization to generate solutions for key business challenges. The WorkOut process involves identifying a critical business goal, forming cross-functional teams to analyze the problem and propose recommendations, and implementing approved solutions within 90 days. WorkOut aims to reduce costs, increase efficiency, and foster collaboration, accountability and trust among employees. Client organizations report results such as reduced operating costs, faster cycle times, and achieving strategic objectives through the WorkOut process.

2. WorkOut Clients Include Frito Lay Co Yellow Freight Acme Steel Dresser, Inc. Northeast Utilities NStar Utilities Metropolitan Life Wawa Food Markets Varco International Avery Dennison AES Corporation International Multifoods L.L. Bean General Electric Metavante World Kitchen PNC FDIC National Steel PG&E IBM Alstom Power

3. WorkOut Engages People’s Experience Enthusiasm Creativity

4. WorkOut Involves Everyone Top Down Leaders or managers identify a key business improvement goal, then challenge those closest to the work to recommend ways to reach the goal. Bottom Up Those closest to the work make specific recommendations to meet the goal, then implement the approved recommendations within 90 days.

7. WorkOut is Scaleable WorkOut fits different levels of scope, time frame, and resources. Length of WorkOut session 1.5 days Length of WorkOut session 2 days Length of WorkOut session 2 to 3 days Length of WorkOut session 3 to 5 days # of WorkOut teams 1 # of WorkOut teams 1 or more # of WorkOut teams 2 or more # of WorkOut teams 3 or more Total planning time: 1 week Planning Team ½ Day Total planning time: 1 to 2 weeks Planning Team 1 Day Total planning time: 2 to 4 weeks Planning Team 1.5 Days Total planning time: 4 to 6 weeks Planning Team 2.5 Days Organic Streamline and Simplify Level C Local department improvement goal Level B Functional business unit goal Level A Strategic organization-wide goal

8. Process Overview, the 6 Steps 1) A Sponsor*: Selects a critical business challenge Selects a Champion to oversee a WorkOut 2.) A Champion*: Selects a Planning Team to guide the WorkOut Serves as lead of the Planning Team * Each step is guided by a WorkOut process manager. 1 of 4

9. 3.) The Planning Team*: Refines the business challenge Defines measurable goals Identifies WorkOut team participants Compiles data and background information critical for the WorkOut team(s) * Each step is guided by a WorkOut process manager. 2 of 4 Process Overview, the 6 Steps

11. 5.) The Sponsor*: Makes “yes” or “no” decisions on each recommendation presented by the WorkOut team(s) on the spot 6.) WorkOut Team Leads*: Oversee the 90 day implementation of the approved recommendations, with the involvement and support of all of the team members * Each step is guided by a WorkOut process manager. Process Overview, the 6 Steps 4 of 4

20. Examples of WorkOut Outcomes

21. GE Superabrasives, looking for productivity gains in their manufacturing process, pulled the engineering and manufacturing functions together in a WorkOut to reduce cycle time on one manufacturing process by 34% in 90 days.

22. L.L.Bean employed WorkOut to increase efficiencies in their warehouse operations. The result was a 20% reduction in damaged goods, the implementation of a new warehouse transition system installed without customer service interruptions, and an increase in accuracy of warehouse picking of .25% during peak season.

23. An international consumer goods company increased sales by $500,000 annually during its first WorkOut session by figuring out how to sell to and through their own businesses.

25. A steel company used WorkOut to reduce errors in order shipments by 15% and significantly increase response time to customer complaints. A nation-wide bank used WorkOut to integrate two disparate compensation systems into one during a merger process.

26. A financial business’s WorkOut team recommended they send auto leasing customers only summary reports of monthly usage. When all the savings from this one WorkOut recommendation were totaled: paper, postage, computer time, labor, customer service time, it amounted to over $100,000 in annual savings.

27. “ When we need to cut cycle time, we go to the people who manage the process and those around them. We don’t tell them how to do it. We give them a STRETCH goal then we say: Do a WorkOut, and come up with an answer.” – GE Manager

28. WorkOut creates the spirit of the start-up firm. Different levels and functions work together. Issues are debated in the spirit of what will be best for the overall organization. Decisions are made quickly, in an interactive forum where everyone can participate and have a voice. And people are empowered to implement solutions quickly. “ GE Work-Out” McGraw-Hill 2002