The Network Imperative Facilitator’s Guide Presentation

The Network Imperative WHY: The Value is in the Network WHAT: 10 Strategies to Network Value HOW: 5 Steps to PIVOT Your Business Model WHO: Becoming a Network Leader copyright, OpenMatters, LLC

The Value is in the Network Overview copyright, OpenMatters, LLC

Networks are Eating the World Digital network Brands World’s largest taxi company owns no taxi’s Uber Largest accommodation provider owns no real estate Airbnb Largest phone companies own no infrastructure Skype, We Chat World’s most valuable retailer has no inventory Alibaba World’s most popular media provider creates no content Facebook Fastest growing banks have no actual money SocietyOne World’s largest movie house owns no cinemas Netflix Largest software vendors don’t write the apps Apple, Google Source: IBM copyright, OpenMatters, LLC

Largest Companies vs. Biggest Networks Brands Market Value Uber $70B Airbnb $25B Alibaba $192B Facebook $341B Netflix $40B Apple $545B Brands Market Value Hertz $4.7B Starwood* 12.66B Walmart $222B WSJ Regal Cinemas $3.1B Microsoft $405.7B * Denotes recently combined value copyright, OpenMatters, LLC

Intangible Assets have grown significantly Source: Ocean Tomo

copyright, OpenMatters, LLC We researched the S&P1500 1,519 Companies in the S&P1500 Index Companies excluded for insufficient data -76 Companies excluded by REIT status -92 Companies analyzed 1,351 Asset Builders Service Providers Technology Creators Network Orchestrators 64% 24% 11% 1% copyright, OpenMatters, LLC

Business Models Scale in Different Ways Characteristics Network Orchestrators Near zero Marginal Cost Network leverage Many Make, Many Sell Technology Creators Low Marginal cost Operating leverage Make One, Sell to Many Service Providers Moderate Marginal Cost No leverage Hire One, Sell to One Asset Builders High Marginal Cost Financing leverage Make One, Sell to One

Examples of Business Model Leaders Example Companies Asset Builder Ford, Walmart, Exxon, Boeing Service Provider Humana, Accenture, JPMorgan Chase Technology Creator Microsoft, Oracle, Medtronic, Pfizer Network Orchestrator eBay, Uber, Visa, Redhat, Tripadvisor copyright, OpenMatters, LLC

Business Models Span All Industries copyright, OpenMatters, LLC

Networks are the most valuable 5x 8x 2x 3x Copyright: OpenMatters, LLC.

$1 invested in Networks produce higher returns copyright, OpenMatters, LLC

Migrate Firm-Centric to Network-Centric Focuses internally Grows slowly Uses its own capabilities Sells its own products and services Has high marginal costs Has low profit margins Has a low multiplier Firm-Centric Focuses externally Grows quickly Uses the capabilities of its networks Lets others make and sell products Has near-zero marginal costs Has high profit margins Has a high multiplier Network-Centric Legacy Organization Network Organization More OpenSpace, growth and profit Copyright: OpenMatters, LLC.

10 Strategies for Creating Network Value copyright, OpenMatters, LLC

10 Strategies for Business Model Success copyright, OpenMatters, LLC

Rule1: Technology - Build Digital Platform Physical Digital Technology

Rule 2: Assets - Invest in Intangibles Finance

Rule 3: Assets - Reallocate your Capital Operator Allocator Strategy

Rule 4: Leadership - Co-Create Value Commander Co-Creator Leadership

Rule 5: Customers – Reward Co-creation Consumers Co-Creators Customers

Rule 6: Revenues -Transition to Subscriptions Transactions Subscription Revenues

Rule 7: Employees - Embrace Freelancers Workers

Rule 8: Accounting - Use Big Data Metrics

Rule 9: Boards - Share Authority Shared Governance

Rule 10: Mindset - Think Open Closed Open Innovation

5 Steps to PIVOT your Business copyright, OpenMatters, LLC

PIVOT Your Business Model Pinpoint Inventory Visualize Operate Track copyright, OpenMatters, LLC

Step 1: PINPOINT Your Business Model Technology Creators Network Orchestrators Asset Builders Service Providers 5x 8x 2x 3x Copyright: OpenMatters, LLC.

Step 2: INVENTORY Your Sources of Value copyright, OpenMatters, LLC

Step 3: VISUALIZE your platform Customers You Suppliers

Step 4: OPERATE your network Company Value Provided Value Received Platform Value Provided Network Measurement Company Management Network Management copyright, OpenMatters, LLC

Step 5: TRACK Your Progress and Performance Financial Capital Physical Capital Human Capital Intellectual Capital Relationship Capital copyright, OpenMatters, LLC

copyright, OpenMatters, LLC The Enterprise Story copyright, OpenMatters, LLC

Become a Network Leader copyright, OpenMatters, LLC

Your Beliefs Determine Your Results Guiding Principles Capital Allocation Skills and Revenues KPI’s & Results Core Beliefs Copyright: OpenMatters, LLC.

To PIVOT, Invert Your Beliefs Old Beliefs New Beliefs Invert Extrapolate Act Identify Uncover copyright, OpenMatters, LLC

copyright, OpenMatters, LLC Thank You! copyright, OpenMatters, LLC