© The Delos Partnership 2007 page 1 Integrated Enterprise Leadership Implementation

© The Delos Partnership 2007 page 2 Integrated Enterprise Leadership ACTIONACTION Week 1Week 2Week 3Week 4 Innovation Review Innovation Review Customer Demand Review Customer Demand Review Supply Plan Review Supply Plan Review Priority Review Priority Review Stage 1 Stage 2 Senior Team Review Senior Team Review Stage 5 Stage 7 Stage 3 Support Review Support Review Stage 6 Stage 4

© The Delos Partnership 2007 page 3 Integrated Enterprise Leadership Implementation AUDITAUDIT Workshop for key people Organise and create Teams Understand And prepare Workshop(s) Facilitation For Design Team(s) Develop Pilot and run 7 Stage process Extend to whole business and refine Implement Month 1Month 2Month 3

© The Delos Partnership 2007 page 4 The Mechanics 1.Assessment of current practice 2.Cost/Benefit Analysis 3.Educate the management team 4.Organise and assign resources 5.Workshop(s) for Project Team and Task Teams  Define: Families - process vs. product Volume and unit of measure Planning horizon Performance measurement and accountabilities  Define process steps - monthly timetable, review groups, agenda 6.Pilot one family or one business then rapidly add the rest 7.Evolve the process

© The Delos Partnership 2007 page 5 Stage One - Awareness AUDITAUDIT Workshop For Key people Organise and Create Teams Understand And prepare Workshop(s) For Team(s) Develop and Extend Pilot and Run 7 stage process Extend to whole Business and Refine Implement Month 1Month 2Month 3 Awareness

© The Delos Partnership 2007 page 6 Cost/Benefit analysis Year 1Year 2Year 3 Cash Flow Benefit £ 3.55 m Costs£ 1.55 m£ 0.17 m Net Benefit- £ 1.55 m+ £ 3.38 m M Assuming 12 month implementation cycle

© The Delos Partnership 2007 page 7 Benefits Seen by some companies Customer service ICI Agrochemicals from 60 % to 95 % plus Cray Valley from 40 % to 95 % Sanofi Aventis Tablet plant 50 % to 95 % Interbake from 90 % to 98 % Scott’s from 91.7 % to 97.8% on all products Cast-Fab and Eclipse held high customer service levels while sales increased by 40 % Levi’s from 80 % to > 95 %

© The Delos Partnership 2007 page 8 Benefits Seen by some companies Inventory ICI Agrochemicals reduced Finished Goods inventory by 30 % [£ 27 mn] Cray Valley by 30 % AGFA from 120 days to 40 days Amcor cut inventory by 40 % Coca-Cola reduced inventory by 56 % Scotts reduced inventory by $ 100 m or 33 % Levi Strauss EMEA 30 %

© The Delos Partnership 2007 page 9 Benefits Seen by some companies Planning Performance Forecast accuracy improved at Sara Lee Forecast Accuracy at Coca Cola improved by 9.7 % Production Plan performance by family of at least 95 % achieved by AGFA, Amcor, Cast-Fab, Coca Cola midi, ICI Agrochemicals, Cray Valley. Norse Dairy Systems Supplier Delivery performance of 95 % plus achieved by most companies Levi Strauss Forecast Accuracy by 35 %

© The Delos Partnership 2007 page 10 Initial Education Principles of Integrated Enterprise Leadership  One set of numbers  Teamwork  Common sense  It’s a formal process not a meeting  Strategic not operational Build the understanding of a broad group of the impact on the business  Reorganise some existing processes  Improving and formalising communication  Longer term view, and not fire-fighting  Integration of all business processes

© The Delos Partnership 2007 page 11 Stage Two- Organisation AUDITAUDIT Workshop For Key people Organise and Create Teams Understand And prepare Workshop(s) For Team(s) Develop and Extend Pilot and Run 7 stage process Extend to whole Business and Refine Implement Month 1Month 2Month 3 Organisation

© The Delos Partnership 2007 page 12 Implementation Resources  Executive Sponsor  Project Leader  Responsible for implementation  Full-time  Continuing role  Process Step owners  Responsible for process development  Continuing role  Integration Team – cross process  Process ‘Design Teams’ with cross functional membership

© The Delos Partnership 2007 page 13 Process Step Owners SENIOR TEAM REVIEW PRIORITY PROCESS INNOVATIONINNOVATION CUSTOMERSCUSTOMERS SUPPLIERSSUPPLIERS SUPPORT ACTIVITIES

© The Delos Partnership 2007 page 14 Role of Process Owners Ensure full development of the process Chair the process meetings Develop process in line with workshops  Inputs/outputs  Performance measures  Team members Keep to the plan Long term process development Provide enthusiasm and knowledge for ideas

© The Delos Partnership 2007 page 15 Process Owners It is impossible to evolve the process without someone to supervise and manage the process who makes the connection between the technical teams and the supporting functions This process owner is not necessarily the person who is most expert in a particular function, but they must be able to understand the requirements and how to use the technology in the day to day business This person must be sufficiently respected within the organisation to be able to make decisions. They must be best placed to develop and put in place new and simpler processes, and to negotiate the balance between operational objectives and technical requirements.

© The Delos Partnership 2007 page 16 Roles of Process Teams Review current processes Review software and data aspects  Develop families  Develop rationale for horizon  Develop links to MPS, financials, etc. Develop data Develop roles and responsibilities Document procedures Review linkages to other steps and existing business meetings Identify and define Key Performance Indicators Review behavioural requirements  Honesty, trust  Real team work

© The Delos Partnership 2007 page 17 Process Team Role VISIONVISION VISIONVISION STRATEGYSTRATEGY STRATEGYSTRATEGY PROCESS TEAMS WORKING SOFTWARE DETAILED POLICIES AND PROCEDURES DETAILED ROLES CULTURECULTURE DETAILEDKPISDETAILEDKPIS FORECASTING CUSTOMER SERVICE

© The Delos Partnership 2007 page 18 Stage Three - Knowledge AUDITAUDIT Workshop For Key people Organise and Create Teams Understand And prepare Workshop(s) For Team(s) Develop and Extend Pilot and Run 7 stage process Extend to whole Business and Refine Implement Month 1Month 2Month 3 Knowledge

© The Delos Partnership 2007 page 19 Cascade education Process Owners INNOVATIONINNOVATION CUSTOMERSCUSTOMERS PRIORITyPRIORITy Process Users SENIOR TEAM EXTERNAL EXPERTISE SUPPORTSUPPORT SUPPLIERSSUPPLIERS

© The Delos Partnership 2007 page 20 Internal Education and Workshop(s) Objectives  Get everyone to the same level of understanding It is a process not a meeting It is strategic not short term firefighting It needs honesty, trust etc.  Design the process steps Innovation Review Demand Review Supply Review Support Review and Priority Review Senior Management Review  Review links to existing activities  Review culture issues and measures

© The Delos Partnership 2007 page 21 Framework for Process Review Process Inputs Outputs People CultureMeasures System

© The Delos Partnership 2007 page 22 Framework for Process Review Process Name InputsPurpose/AgendaOutputs People Desired Culture Measures Systems to support this step Link to other Processes

© The Delos Partnership 2007 page 23 Cascade education Process Owners INNOVATIONINNOVATION CUSTOMERSCUSTOMERS PRIORITyPRIORITy Process Users SENIOR TEAM SUPPORTSUPPORT SUPPLIERSSUPPLIERS

© The Delos Partnership 2007 page 24 Internal Education and Training Objectives  Everyone understands the new process  Clarify process and culture changes  Training in use of systems  Understanding of Performance Measures  Clarify links between functions and process steps Outcome  Understanding of all aspects of Integrated Enterprise Leadership  Readiness for new ways of working

© The Delos Partnership 2007 page 25 Internal Education Carried out by Process Owner Supported by expert as necessary Explain to everybody why Engage in new ways of workingFormality  Agendas  Agreed timetable Reinforce culture Explain Performance Measures

© The Delos Partnership 2007 page 26 R&T Top Level Process Categorise to identify operations Related Projects Update central document showing project status and impact on operations Convert project data into operations impact R&T Project Managers Collate/generate new ideas for R&T projects Review progress To Operations Innovation To Customer Demand Planning To Supply Planning Phase

© The Delos Partnership 2007 page 27 R&T PROFORMA Changes since previous cycle must be highlighted Projects with Ops content: Impact on Ops:

© The Delos Partnership 2007 page 28 Integrated Enterprise Leadership Implementation AUDITAUDIT Workshop for key people Organise and create Teams Understand And prepare Workshop(s) For Design Team(s) Develop Pilot and run 7 Stage process Extend to whole business and refine Implement Month 1Month 2Month 3

© The Delos Partnership 2007 page 29 Pilot the process Choose one product family or business area Run through the full seven step process for one or two months Review success of each step and refine/improve Review impact on rollout Finalise software and data requirements Build enthusiasm for the ideas  Rolling business plan  Long term view not fire fighting  Improved communication  Fewer ad hoc meetings

© The Delos Partnership 2007 page 30 Extend the process to the whole business Make Integrated Enterprise Leadership the business process Move to new process as soon as possible  For all product families  For all business units  For all functions/processes Avoid the permanent project syndrome

© The Delos Partnership 2007 page 31 Step Five - Competency AUDITAUDIT Workshop For Key people Organise and Create Teams Understand And prepare Workshop(s) For Team(s) Develop and Extend Pilot and Run 7 stage process Extend to whole Business and Refine Implement Month 1Month 2Month 3 Prepare Budget from IEL Process Competency

© The Delos Partnership 2007 page 32 Global Integrated Enterprise Leadership 1.Create Global Team, with local people 2.Create a generic model or template 3.Create local teams – local ownership 4.Adapt the generic model to local environment 5.Pilot locally 6.Aggregate and carry out a global pilot 7.Operate the global process

© The Delos Partnership 2007 page 33 Global Integrated Enterprise Leadership Template Global Team Local Model Local Team

© The Delos Partnership 2007 page 34 Multi-Level Integrated Enterprise Planning Week 1Week 2Week 3Week 4 Demand Planning Demand Planning Demand Planning Demand Planning Demand Planning Customer New Activity Review Innovation Supply Review Supply Review Supply Review Supply Review Financial Priorities Consolidated Recocniliation Financial Priorities Corporate Review Senior Team Review GLOBALLOCALGLOBALLOCAL LEVEL 1 Country/ Market LEVEL 2 Region/ Business Unit LEVEL 3 Europe/ Global HQ

© The Delos Partnership 2007 page 35 Cascade education – globally and locally Local Process Owners SENIOR TEAM INNOVATIONINNOVATION CUSTOMERSCUSTOMERS PRIORITyPRIORITy SUPPORTSUPPORT SUPPLIERSSUPPLIERS Process Users Global

© The Delos Partnership 2007 page 36 The global challenges Discipline across the organisation Common systems Common definitions Single source of information Timing of meetings Timeliness Leadership

© The Delos Partnership 2007 page 37 Implementation – the key issues Commitment of top team One single agenda – apart from running the business Availability of data and data formats Resources to implement No conflicting initiatives Willingness to link into budget

© The Delos Partnership 2007 page 38 Integrated Enterprise Leadership Success depends on: Commitment from the Top Team Everyone’s understanding  It is organised common sense  It is a process not a meeting Preparation of the process Desire to make it work Seeing this as the way to make the budget

© The Delos Partnership 2007 page 39 Critical Success Factors Leadership from the top Simplicity of approach Education led by example Early Pilot and rapid roll out  Delay is the enemy of success Enthusiasm, dedication and knowledge of the Executive Sponsor and Project Leader Avoiding initiatives

© The Delos Partnership 2007 page 40 Senior Management’s role Show real enthusiasm Lead the knowledge transfer process Insist on everyone's participation Make sure clear decisions are made and immediately communicated Ensure that all the right participants attend Persevere with desire for integration Be a participant, not a spectator

© The Delos Partnership 2007 page 41 LeadershipLeadership SimplificationSimplification ControlControl UnderstandingUnderstanding Progress to Leadership ChaosChaos Process Improvement People Improvement Systems Improvement