1. Natalia Parmenova Business Development Manager SAPMarkets Europe Building an eGovernment Procurement together

2.  SAP 2000 SAPMarkets / 2 What we would like to share with you today l What is the profile of SAPMarkets l Where we see the eMarketplaces business going l What solutions SAPMarkets provides to the clients l What lessons we have learned together with our partners in eMarketplace projects l How SAPMarkets can bring value to your eMarketplace

3.  SAP 2000 SAPMarkets / 3 Corporate Profile l SAP AG spin-off l Headquarters in Palo Alto, California l Announced March 15, 2000 l Opened for business in May, 2000 l Employees: ~200 initially, ~400 by 2001 l SAP to retain majority control of SAPMarkets l SAP AG spin-off l Headquarters in Palo Alto, California l Announced March 15, 2000 l Opened for business in May, 2000 l Employees: ~200 initially, ~400 by 2001 l SAP to retain majority control of SAPMarkets

4.  SAP 2000 SAPMarkets / 4 SAPMarkets Regional Offices Palo Alto - Headquarters - Marketing - Development Center - Biz Development Americas Montreal - Development Center Walldorf - Development Center - Biz Development Europe Bangalore - Development Center Singapore - Biz Development Asia

5.  SAP 2000 SAPMarkets / 5 Mission of SAPMarkets Develop, market and operate the open business network of marketplaces.

6.  SAP 2000 SAPMarkets / 6 Why Form SAPMarkets? l Focused, agile entity l World wide strength driven from Palo Alto at the heart of the Internet revolution l Leverage SAP ecosystem (customers, partners, service organization and sales force) l More than buying and selling (collaborative forecasting, dynamic pricing, RFP/RFQ matching, tendering,...) l Leverage SAP’s existing industry knowledge l Draw on SAP’s integration knowledge

7. Where we see eMarketplaces business going

8.  SAP 2000 SAPMarkets / 8 B2B e-commerce is evolving rapidly to address more complex business processes Exchange-to-exchange Complex Business Process Direct Goods and Services Trade Facilitation Trade Services E-Marketplaces Buying and Selling Indirect Goods and Service Point-to-Point Connections Discreet Applications B2B eCommerce evolution trend

9.  SAP 2000 SAPMarkets / 9 Portal (e.g. B2C Sales - Mall) Internal Marketplace (Integration Hub) Marketplace Options 1:n Marketplace (e.g. Supply chain hub) n:m Marketplace (e.g. Exchange) A) D) C) B) Federation

10.  SAP 2000 SAPMarkets / 10 The New Landscape of Collaboration EnterpriseMarketplaceConsumer

11.  SAP 2000 SAPMarkets / 11 Consumer Portals / Malls

12.  SAP 2000 SAPMarkets / 12 Exchanges

13.  SAP 2000 SAPMarkets / 13 Channel Master Marketplaces

14.  SAP 2000 SAPMarkets / 14 Corporate Marketplaces

15.  SAP 2000 SAPMarkets / 15 The New Landscape of Collaboration EnterpriseMarketplaceConsumer

16.  SAP 2000 SAPMarkets / 16 e-Business Applications for On- and Off- Ramps On-/Off-Ramps

17.  SAP 2000 SAPMarkets / 17 Hosted e-Business Applications EnterpriseMarketplaceConsumer CRM SCM B2B CRM SCM B2B

18.  SAP 2000 SAPMarkets / 18 Syndication of Services 3rd party service provider

19.  SAP 2000 SAPMarkets / 19 Single Access

20. What lessons we have learned together with our partners in eMarketplace projects

21.  SAP 2000 SAPMarkets / 21 Automotive N. America Utilities Aerospace Energy Global Utilities Industry e-Marketplaces Engineering ConsumerProducts Chemicals & Pharmaceuticals Metals & Mining

22.  SAP 2000 SAPMarkets / 22 Observation 1: PR War Turns into Delivery War Promises: l Increase shareholder value l Maximize liquidity l Increase investor confidence l Improve market efficiency Facts: l Economic value of pure exchanges is unclear l Applications create the value l “Show me the money” attitude

23.  SAP 2000 SAPMarkets / 23 Observation 2: Integration Continues To Be Key Needed: l A business plan l Openness l Partners’ components l Integration l Common messaging semantics Time before plan changes Strategic nature of integration Low High Hackers heaven A real plan: Integration Architecture Go to the lab: ? Short term fix: Buy/build tactically CRMSCMERPBI eCom- merce Workplace Marketplace

24.  SAP 2000 SAPMarkets / 24 Observation 3: Applications Become Services Components migrate onto marketplaces: l Serve multiple companies l Hosted l Ubiquitous l Personalized l Partner software built-in l Integrated with back-end l Scalability, performance, availability and security Supply Chain Optimization MRO Procurement Direct Procurement Planning and Optimizing Analysis Relationship Management Sales Service Marketing B) A)

25.  SAP 2000 SAPMarkets / 25 Observation 4: Revenue models impact service offerings Time Revenue Over time, value-added services revenue will become dominant revenue source Current focus is on driving transactions to generate revenue for exchange Transaction revenue Value added service revenue eMarketplace revenue streams will evolve from transaction to value-added services

26. Success stories of today

27.  SAP 2000 SAPMarkets / 27 Success Story: ec4ec l Buyer / supplier involvement in business & service roadmap planning l Long-term service offering planning (18 months time horizon) l Business plan: 5 year horizon l Distinctive value proposition: n Collaboration between engineers, purchasers and suppliers in creating and procuring complex components n Reduced time-to-market, therefore, lower process costs n Simple, fast and cost-effective solution

28.  SAP 2000 SAPMarkets / 28 Success Story: CPGmarket n potential for cost reductions for sellers and buyers by sharing a technical platform and infrastructure, decreasing procurement cost, reducing the time taken to source products and services n shared planning services to reduce supply chain costs n tailored information to potentially exploit new opportunities l Industry issues oriented l Speed of services offering l Active marketing by all founder-participants l Third-party services l Value proposition:

29.  SAP 2000 SAPMarkets / 29 Success Story: EMARO l Differentiation points l Seamless integration of business processes through the marketplace l User oriented Catalog Mgt to enable flexible and comprehensive product offering l Value proposition l Lower Transaction costs l Reduced M&S costs for seller l Lower prices for buyers l Why to select SAP / SAPMarkets / Commerce One? l Availability of solution l One-stop shopping & strong integration of services & to back-end systems l Strong partnership between SAPMarkets / SAP AG and Deutsche Bank l Strong partnership for service extension, business development and sales support

30.  SAP 2000 SAPMarkets / 30 Success Story: hubwoo l Addressing Europe and building strong partnership with other regional marketplaces in USA and Asia l Focusing on large buyers (> 200 Mio € revenues) l eProcurement, Reporting, Benchmarking, Logistics, Transportations l 3 rd party: Financial services l Lessons learned / experiences: Provide standard solution based on SAP standards

31.  SAP 2000 SAPMarkets / 31 So, all in all, what have we learned? proving the validity of the ideas l Business modelling is a key for proving the validity of the ideas for attracting participants l Rapid deployment coupled with sound service offering road map is a key for attracting participants getting the traffic quickly l Differentiating your value proposition is a key for getting the traffic quickly built confidence l Long-term partnerships help to built confidence

32. What solutions SAPMarkets provides to the clients

33.  SAP 2000 SAPMarkets / 33 Component Architecture Browser MarketSet Services Framework MarketSet Analytics MarketSet Catalog MarketSet Life-Cycle Collaboration MarketSet Supply Chain Collaboration MarketSet Dynamic Pricing MarketSet Order Management (further to come….) MarketSet Procurement MarketSet Builder SAP Materials Management / SAP Financials / SAP Document Mgmt System Buyer On-Ramps 3rd Party Components Oracle, PeopleSoft, i2, Ariba, etc. Enterprise Buyer Desktop / Professional MarketSet Connector MarketSet Bulletin Board SAP Advanced Planner & Optimizer Browser Seller On-Ramps 3rd Party Components Oracle, PeopleSoft, i2, Ariba, etc. SAP Internet Sales / SAP Customer Relationship Mgmt SAP Online Store / SAP Sales & Distribution / SAP Financials / SAP Document Mgmt System SAP Advanced Planner & Optimizer MarketSet Platform Transport Service Provider Export/Import Service Provider Financial Service Provider Marketplaces SAP, GTW, dotcoms, etc. Marketplaces SAP, GTW, dotcoms, etc. MarketSet Connector xCBL

34.  SAP 2000 SAPMarkets / 34 Architecture MarketSet Platform Basic infrastructure on which marketplaces are built:  Trading partner connectivity through xCBL  Document message routing and transaction processing  EDI and RosettaNet gateway support  Administration console for process management  Marketplace and transaction security and Single Sign On MarketSet Services Framework Framework for rapid integration of marketplace services:  Pre-packaged components for seamless integration of bundled, premium and third-party services MarketSet Builder Create the front-facing marketplace experience:  User Interface builder for HTML and mobile services  Community features and services  Role based & user driven personalization features  Trading Partner Directory MarketSetServices Framework MarketSet Analytics MarketSet Catalog MarketSet Life-Cycle Collaboration MarketSet Supply Chain Collaboration MarketSet Dynamic Pricing MarketSet Order Management (further to come….) MarketSet Procurement MarketSet Builder MarketSet Bulletin Board MarketSet Platform

35.  SAP 2000 SAPMarkets / 35 Architecture - Builder MarketSet Builder Front-facing marketplace experience:  User Interface builder for HTML and Mobile services  Based on Jetspeed rendering engine  HTML input as well as XML  Integration to SAP’s workplace business content  Community features and services  Personalization features Help market makers create a community  Templates  System for user/policy management  Role-based and user-based personalization  Methods for trading partner registration & user login MarketSetServices Framework MarketSet Analytics MarketSet Catalog MarketSet Life-Cycle Collaboration MarketSet Supply Chain Collaboration MarketSet Dynamic Pricing MarketSet Order Management (further to come….) MarketSet Procurement MarketSet Builder MarketSet Bulletin Board MarketSet Platform

36.  SAP 2000 SAPMarkets / 36 Architecture – Service Framework MarketSetServices Framework MarketSet Analytics MarketSet Catalog MarketSet Life-Cycle Collaboration MarketSet Supply Chain Collaboration MarketSet Dynamic Pricing MarketSet Order Management (further to come….) MarketSet Procurement MarketSet Builder MarketSet Bulletin Board MarketSet Platform MarketSet Services Framework Rapid integration of services  Pre-packaged components for seamless integration of bundled, premium and third-party services  Software tools, APIs, documentation, and methodologies for integrating services  Documented in Business Service Framework (BSF) Cookbook Native support for xCBL  xCBL = XML Common Business Library -> http://www.xcbl.org/ http://www.xcbl.org/  Document framework for robust XML exchange

37.  SAP 2000 SAPMarkets / 37 Architecture - Platform MarketSetServices Framework MarketSet Analytics MarketSet Catalog MarketSet Life-Cycle Collaboration MarketSet Supply Chain Collaboration MarketSet Dynamic Pricing MarketSet Order Management (further to come….) MarketSet Procurement MarketSet Builder MarketSet Bulletin Board MarketSet Platform Security  Marketplace security  Secure document message routing  SAP Trust Center services integration Connectivity  Establish xCBL communication points for trading partners  Integration of SAP applications via MarketSet Connector  EDI gateway for transaction services and supplier integration  RosettaNet gateway support Management  Administration console  Marketplace management  Performance tuning

38.  SAP 2000 SAPMarkets / 38 Marketplace Services on demand Marketplace front end (role based, personal user interface with access to marketplace services & application, set of html/XML templates) Marketplace Services (hosted Services provided by Marketplace) People acting in roles (purchaser, employee), participating in business scenarios MarketSet MarketSet Platform MarketSet Services Framework Analysis Services Catalog Services Logistics Services Design Services Planning Services … Financial Services Trade Services Dynamic Pricing Order Mgmt. Bulletin Board Market Buyer MarketSet Builder eProcurement Order ManagementeCatalogue Analysis Collaborative Planning Collaborative Design Marketplace Platform MP Performance ManagementMarket ConnectSecurity MarketSet Builder User Management

39.  SAP 2000 SAPMarkets / 39 MarketSet Architecture – Logical Diagram MarketSet Builder MarketSet Service Framework MarketSet Analytics BW ITS Financial Service Enterprise Buyer Pro EBP/CRM Requisite ITS Enterprise Buyer Desk Buysite SAP APO APO Live Cache ITS Marketplaces 3 rd Party Oracle, PeopleSoft,..etc Legacy SAP APO APO Live Cache ITS Marketplaces 3 rd Party “Oracle, PeopleSof,..etc” Legacy Browser MarketSet Procurement EBP/CRM ITS Security Package MarketSet Platform MarketSet OM CRM Security Package Buy Side On RampsSell Side On Ramps MarketSet SCC APO Live Cache ITS MarketSet LC Live Cache KPro PLM ITS SAP R/3 MM FI DMS SAP R/3 SD FI DMS Online Store MarketSet Info Services Advertisement Feed News Feed *not part of MarketSet Delivery Logistic ServiceTrade Service Community Services Trading Partner Mgt. User Mgmt / Security Communities Business Service Mgmt SonicMQ PDC* BDC* Firewall* Load Balancer* Foglight CCMSPortal Router Data Storage DBs LDAP Round TripTracking Multicast BC Mapping XDK Pro XPC MarketSet DP Websphere DPE Security Package XDK Pro MarketSet Bulletin Board Websphere BB Security Package XDK Pro User Interface Jetspeed Cocoon Search MarketSet Catalog Content Engine iMerge SAP Internet Sales ITS Internet Sales/CRM IPC Dr. Fuzzy MarketSet Connect SonicMQ XDK Pro Mapping Transformation MarketSet Connect SonicMQ XDK Pro Mapping Transformation Marketplace Transformation

40. What is Collaborative Business Scenario

41.  SAP 2000 SAPMarkets / 41 What is a Collaborative Business Scenario? Collaborative Business Scenarios l Are business processes that transcend the borders of individual enterprises l Involve multiple parties and people with defined activities and roles l Span multiple IT environments and systems l Make use of internet technology and services l Can take place on marketplaces and hubs Participant Activity

42.  SAP 2000 SAPMarkets / 42 Rules of Drawing SellerBuyerMarketplace Action done by buyer Action done by seller Functionality of buyer´s backend system Action done by market place Functionality of Enterprise Buyer Functionality of MarketSet Internet Sales or Online Store Functionality of seller´s backend system Data passed via standard market place interface Color Key Column Key Application component Other standard interface xCBL, SAP XML Software behind firewall of buyer, which allows access to marketplace Software behind firewall of seller, which allows access to marketplace Includes also Market Buyer and Order Management Active form is used for actions done by a user. Passive form is used for actions done automatically by the system

43.  SAP 2000 SAPMarkets / 43 Introducing the Marketplace Participant m : n Marketplace Participant m : 1 : n

44.  SAP 2000 SAPMarkets / 44 Applications follow Processes Processes Inter-Enterprise Collaborative Applications on Marketplace Applications Backend Marketplace Backend

45.  SAP 2000 SAPMarkets / 45 InitiatorMarketplaceRespondent RFx Process Need for RFx Prepare Engineering Documents Create RFx... Review bids and select winner... Need for Business Receive RFx Prepare Engineering Documents Create Bid... Bulletin Board Backend...

46.  SAP 2000 SAPMarkets / 46 Request for Information SellerBuyerMarketplace Product / product group is specified Select supplier sub-set Read invitation (with link to RFI) RFI is published in Bulletin Board Provide information Update trading partner directory DP Email system BB Read notification Email system TPD Submit DP No automatic update of TPD so far

47.  SAP 2000 SAPMarkets / 47 Detail: Request for Quotation with DP (public)SellerBuyerMarketplace Define product specifics Read notification Specify RFQ RFQ is published in Bulletin Board Request for registration Submit Update trading partner directory Make bid Send out opportunity result or convert to reverse auction DP BB DP Email system DP Read notification Select winner(s) DP Email system TPD

48.  SAP 2000 SAPMarkets / 48 Detail: Request for Quotation with DP (non-public) SellerBuyerMarketplace Select supplier sub-set Define product specifics Read invitation (with link to RFQ) Read notification Specify RFQ Submit Make bid DP Email system DP Read notification RFQ follow-up Select winner(s) DP Email system Send out opportunity result or convert to reverse auction DP TPD

49.  SAP 2000 SAPMarkets / 49 Dynamic Pricing Respondent XYZ Inc. Initiator ABC Inc. Identify obsolete equipment Select sales channel: Auction Create quotation Review bids and select winner Create sales order Fulfillment and billing Identify need for equipment Select supply channel: Auction Find auction and bid on auction Selected as winner of auction Create purchase order Receipt & payment XML HTML Auction eMail Example: Auction for Obsolete Equipment Market place ERP Backend

50.  SAP 2000 SAPMarkets / 50 Bulletin Board BULLETIN BOARD Marketplace Business Applications BBP - Bid Invitation Delivery Note RFP/RFQ Exchanges Dynamic Pricing Asset retirement Auctions

51.  SAP 2000 SAPMarkets / 51 Auction is published in Bulletin Board Detail: Reverse AuctionMarketplace Specify product Specify auction Read invitation (with link to auction) Submit Make bid Select supplier sub-set DP View best bid and make new bid DP Email system BuyerSeller DP TPD BB DP Close auction and send out opportunity result DP

52.  SAP 2000 SAPMarkets / 52 BuyerSellerMarketplace Specify product Specify auction Submit Auction is published in Bulletin Board Make bid View best bid and make new bid Detail: Forward Auction (manual) DP BB DP Close auction and send out opportunity result DP

53.  SAP 2000 SAPMarkets / 53 View best bid and make new bid Buyer Auction is created DP SellerMarketplace Auction is published in Bulletin Board Make bid Close auction and send out opportunity result Detail: Forward Auction (unused equipment) DP BB create quotation SD Identify surplus equipment PM Mapping in SAP Business Connector required DP

54.  SAP 2000 SAPMarkets / 54 BuyerSellerMarketplace Auction is created Auction is published in Bulletin Board Make bid View best bid and make new bid Detail: Forward Auction (excess stock) DP BB Create quotation Identify and reserve excess stock APO SD DP Close auction and send out opportunity result Excess stock is reserved MM Mapping in SAP Business Connector required DP

55. How SAPMarkets can bring value to your eMarketplace

56.  SAP 2000 SAPMarkets / 56 Supporting the dynamic needs of the B2B industry Products Continued release of product features and enhancements Continued release of product features and enhancements Open Business Services Layer Open Business Services Layer Developing more on-ramps Developing more on-ramps Partnerships Continued open standards and interoperability Continued open standards and interoperability Further development of the Global Trading Web Further development of the Global Trading Web Building integration partners network Building integration partners network Business Services Aggressive development of relationship with third party solution providers Aggressive development of relationship with third party solution providers Strategy Development Area

57.  SAP 2000 SAPMarkets / 57 SAPMarkets Solution Portfolio.net Service Hub l Service Registry l Add-in Services l Financial l Logistics l Insurance l Legal l Content l Auction l Advertising l Recruitment l News/Search l Learning l Translation, … l Other marketplaces Enterprise Buyer on-ramp MarketSet l Webflow l Collaboration Engines for Supply Chain, Demand Chain, Life Cycle, Core … l Add-in Services Enterprise using hosted on-ramp Connected Enterprise Internet Sales on-ramp

58.  SAP 2000 SAPMarkets / 58 SAPMarkets dream teaming with C1 l Leading marketplace technology + Leading b2b applications = one joint marketplace solution l Marketing approach to software engineering l Pre-engineered solutions (as opposite to the „product is project“ approach) l Integration capabilites n Horizontal = into the value chain or network n Vertical = in legacy / LAN environment l Openness and connectivity l Compliance to the latest industry standards l Onramps strategy: Enterprise Buyer leap frogging any alternative product within 2000 with Direct material, Multi-Enterprise, Plant Maintenance and Services and more l Delivered about 75% of today's live marketplaces

59.  SAP 2000 SAPMarkets / 59 To integrate applications and technology To partner with confidence and success Dimensions of Openness To build the right commercial model

60.  SAP 2000 SAPMarkets / 60 Telecommunication Global Trading Web N. America Utilities Aerospace Energy Global Utilities Film and Television Global Trading Web

61.  SAP 2000 SAPMarkets / 61 The range of services we offer to our partners  Alliance development  Value added services portfolio  Financial modeling and pricing strategy  Governance design and management  Organization design  Content management  Sourcing strategy  Auction services  Catalog management  Collaborative planning  Virtual integration  Partner coordination  Execution  Milestone management  Contingency planning  Procurement process redesign  Change management  Organizational redesign Buyer Adoption Consistent value proposition and pricing strategy Effective sales strategy Supplier Adoption Effective marketing and communication Incorporation of supplier feedback  Exchange design  Buyer / supplier integration  User-interface Business Strategy Supply Chain Services Business Process (Re)design Technical Architecture Program Management Marketing Services

62. Thank you for your interest