I have attached a chart that Janet created that examines quality rates over a period of time. The chart identifies events that triggered, in her well-documented opinion, these quality rates to decline. The correlation is obvious, linking cost pressures with declining product quality.
It is my belief that, due to the strong correlation between the two, reversing the current trend will be easily achievable in a timely manner.
The Agency team couldn't identify with any precision which deaths Janet was referring to in her note. Since she wrote the note in December, it could not have been related to the Kandahar incident in April. Last year, few drone-related casualties were reported, no friendly fire incidents, and no incidents took place on US soil either.
The only potential death we could presumably link to Janet's note is the death of Sebastian Williams, former director of operational effectiveness at the Alpine plant. Williams died of a heart attack in October of last year. He was one of the most vocal opponents of the cost-driven actions and employee reductions at the plant. His cardiologist has confirmed for us that Williams had been complaining of stress-related chest pains and blood pressure, and that he had indicated the work environment as being the source of his elevated stress.
2. The unexplained stock price fluctuations.
We have uncovered the fact that four of the five senior leaders at NanoLance were planning to gain control over the company by acquiring the stock that you would be selling in preparation for your retirement. These leaders are Walker, Sheppard, Prescott, and Kramer.
There is nothing wrong with this intention by itself. However, to allow them to obtain control of more than 50 percent of the outstanding shares, the four needed to come up with a considerable amount of cash, which they don't currently possess. The following actions were taken to address their shortage of cash:
• Significant padding of specific, hard-to-trace expenses. Kramer was the orchestrator of this action, setting up overpaid contracts with offshore providers, for services that are hard to quantify and trace, such as outsourced research and development, software architecture, design and development, application testing, etc. This strategy maintained the company's profit margins at relatively low levels, thus keeping the stock price under control. This strategy also led to the accumulation of significant amounts of cash, in various offshore accounts, with the intention to provide the group with the liquidity needed to purchase the stock. Kramer is on tape admitting to this entire scheme, while holding me at gunpoint and setting me up to be killed by a drone, on the Alpine test field, on July 15. The FBI has stepped in to ensure the accounts are frozen and the funds are seized and returned.
• Deliberate leaks to the press, placing the company under unfavorable light, with the intention of driving down the stock price. Walker put pressure on Prescott to "get him something worth reading in the press." While this in itself is inconclusive, we have Prescott's cell phone records, showing she twice dialed a News of the Hour direct phone number. These calls took place on days before major releases of reports that were highly damaging to the company's reputation and stock price.
• These two separate, yet concerted, sets of actions were carefully timed to maximize the damage. They are responsible for the stock price losing almost 50 percent of its value. The size of the financial loss due to the oversized expenses is yet to be determined, as it would require your permission and guidance on how to investigate, report, and correct this issue. Recovering the offshore cash deposits could potentially pose additional challenges.
3. Low employee engagement scores.
Considering the depth of the damage uncovered with respect to the other issues, it is my strong belief that by replacing the ineffective or corrupt leaders, and by properly communicating the change and its reasons to the broader organization, the employee engagement will be restored. A key point in regaining employee trust would be to recognize the process failures and to set strategies to correct these failures, while giving assurances regarding the future. Clear, honest communication is essential.
4. Potentially related drone incident in Kandahar.
The drone that opened fire on a Canadian patrol in Kandahar last April was a NanoLance drone. However, findings indicate that there is no company liability in this case. The preliminary investigation into the incident has determined that the drone operators were at fault. A US Air Force liaison was able to secure some details about the events of that day. Allegedly, the two operators of the Kandahar drone were aware that the drone had the self-guidance module installed for testing purposes. They were flying the drone over a lengthy distance, from one base to another.
During this commute, no actions were required on their part, other than keeping the drone on course, speed, and altitude. They decided, on their own, to switch on the self-guidance software for a while, without any authorization, and go outside for a smoke. Being unaccustomed with operating the self-guidance module of the drone, they failed to put the safety measures in place, specifically those designed to keep the drone from launching missiles at unconfirmed targets, or to open fire on its own. Therefore, it can be concluded that NanoLance had no responsibility in the Kandahar incident.
However, the subsequent incident that took place in Florida can be blamed on intermittent defects preventing the drone from being under the control of its operators. During this separate investigation, we have learned that these operators also would engage in short, self-guided flights with their drones, lacking proper authorization. However, this was not the case on the day of the Florida incident. The Florida drone came in and out of control with the ground operators, despite their desperate attempts to control it, causing its flight path to be unpredictable, and the consequences to be dire.
This reported behavior is consistent with the lower-grade circuit boards found at the plant. Lower quality circuit boards can lead to intermittent defects, and this drone appeared to have been equipped with a faulty circuit board affecting its navigation and / or communications module(s). The US Air Force is yet to release complete official findings in this case.
Section B — Recommendations
1. Staffing
I would highly recommend the immediate termination of the following personneclass="underline"
• Benjamin Walker, COO
Future investigations will be conducted by the authorities regarding Walker's involvement into criminal activities. An indictment is highly likely, in case he is found responsible for instigating Prescott into leaking damaging information to the press. He is also under investigation for a series of SEC violations.
His replacement could well be John Dunwood, vice president of manufacturing. Dunwood is a well-respected and dedicated man with great operational experience, a passion for his work, and consideration for his employees. His moral compass is unaffected by his tenure as a direct report of Walker's. He has my full endorsement for the role of COO.
• Dustin Sheppard, CTO
Further investigations will also be conducted in his case, probing into his involvement into padding technology expenses. Regardless of outcome, his employment should be terminated immediately.
• Angela Prescott, VP, HR
Prescott's contribution to the media leaks will probably not attract any legal consequence, due to the media scandal that would ensue. Therefore, we would highly recommend you avoid pursuing the media leaks angle.