1. TNS Proprietary: © 2005 1 Linking Employee Compensation to Survey Metrics High-Level Considerations and Best Practices January, 2006

2. TNS Proprietary: © 2005 2 Key Considerations for Linking a Survey Metric to Compensation What will the metric be, how will it be calculated, and how will the data be gathered? Will a single metric be used across all affected employees, or will there be multiple metrics tailored to different employee groups? Which employees will have their compensation tied to the metric, and exactly how will it be tied? How much (and what type) of compensation will be included? Will the percentage of compensation tied to the metric vary by position, business unit, geography, etc.? Will it be an all-or-nothing payout, or will there be a variable scale? When will the measurement be made, and how often? How will the target(s) be set? Will the target be the same across all geographies, business units, etc.? What time period will target cover, and will the target be adjusted over time? Will there be a single target or a range of targets (e.g., setting one number as the reasonable target and another as a ‘stretch’ target that triggers additional compensation)? How will the program be communicated to employees? Will employees be able to track the metric over time?

3. TNS Proprietary: © 2005 3 Key Considerations for Selecting Compensation Metric(s) Corporate mission and goals Does the metric directly support the company’s primary mission and goals? Link between metric and tangible outcomes (e.g., revenue growth) Does a positive move in the metric contribute directly to a positive increase in a tangible outcome? Employee’s ability to understand and directly impact the metric Can employees easily understand how the metric is collected and calculated? Do employees believe they can have a direct impact on the metric? Ability to collect necessary data Can the data necessary to support the metric be captured accurately, effectively and consistently? Ability to collect apples-to-apples benchmarking data on competitors How does performance on the metric compare to competitors? Even if performance doesn’t improve in an absolute sense, does an improvement relative to key competitors deserve to be rewarded?

4. TNS Proprietary: © 2005 4 Potential Criteria for Setting Metric Targets Significant improvement from the baseline score e.g., X% improvement over the baseline score Link to tangible results from multi-company data e.g., Based on TNS data that includes over 20 IT companies, a CLI score of X% is associated with revenue growth of X% the following year Link to tangible results from Company-specific data e.g., Based on an analysis of ’s customer behavior linked to customer loyalty data, a CLI score of X% is associated with revenue growth of X% the following year Link to competitor benchmarks e.g., Based on TNS data, a CLI score of X% would place in the top X% of its IT clients

5. TNS Proprietary: © 2005 5 Best Practices for Linking a Survey Metric to Compensation Ensure close HR involvement throughout program design and execution Select a metric that every affected employee can understand and influence Use survey data to demonstrate the link between customer perception of specific areas/attributes (e.g., responsiveness of technical support) and the metric Identify specific actions employees can take to impact the metric Tailor the actions to specific employee groups (e.g., one set of recommendations for marketing employees and other set for operations employees) Develop and implement a comprehensive communication plan Provide an initial overview of program Present the overview to all employees before data collection begins Provide employees with ongoing updates/status, including communication of the specific actions they can take to impact the metric Maintain consistency over time Avoid making frequent adjustments to the program

6. TNS Proprietary: © 2005 6 Potential High-Level Metrics Overall Satisfaction Pros: very simple; shown in some studies to have a connection with revenue Cons: can be unrelated to desired behaviors (e.g., repurchasing); highly satisfied customers may be even more satisfied with competitors Referenceability / Net Promoters Advocated by Frederick Reichheld (Bain & Co., author of ‘The Loyalty Effect’) Pros: relatively simple; shown by Reichheld to have a stronger connection with revenue growth than overall satisfaction “Our research indicates that satisfaction lacks a consistently demonstrable connection to actual customer behavior and growth.” – Reichheld in ‘The One Number You Need to Grow’, Harvard Business Review, December 2003. Cons: does not account for market factors unrelated to customer perception (e.g., going out of business, etc.) Loyalty Index Preferred by many TNS clients Pros: relatively simple; shown by TNS to have a stronger connection with revenue growth than overall satisfaction or referenceability alone; eliminates need for scale conversions when used across multiple surveys Cons: the three standard loyalty index questions (referenceability, repurchase intentions, future purchase levels) are not equally applicable to top customers (e.g., presumably a company’s top customers will almost always indicate that they plan to purchase from the company again)

7. TNS Proprietary: © 2005 7 TNS Customer Loyalty Index (ProCLI) Based on three questions: Referenceability Do you consider yourself a favorable reference for ? Repurchase intentions Based upon your experience, are you very likely to continue purchasing ’s products? Future purchase levels Assuming ’s performance remains the same as it is now, do you expect your company’s future purchase levels from will be higher, lower, or the same? CLI is the percentage of respondents who give the ‘good’ answers to all three questions: ‘Yes’ to referenceability ‘Yes’ to repurchase intentions ‘Same’ or ‘Higher’ to future purchase levels TNS has demonstrated a strong link between CLI and revenue growth In a recent wave of the TNS Comparative Program for the IT industry, every 10% increase in CLI was associated with a 12.5% gain in annual revenue growth the following year

8. TNS Proprietary: © 2005 8 TNS Customer Loyalty Index (ProCLI) ProCLI is a single measurement of the overall loyalty of your customer base ProCLI is based on the answers to three component questions: Referenceability: Do you consider yourself a favorable reference for ? Repurchase Intentions: Based upon your experience, are you very likely to continue purchasing ’s products? Future Purchase Levels: Assuming ’s performance remains the same as it is now, do you expect your company’s future purchase levels from will be higher than in the past, lower than in the past, or the same as in the past? ProCLI is calculated as the percentage of respondents who give the desirable answers to all three component questions (‘yes’ to Referenceability, ‘yes’ to Repurchase Intentions, and ‘same’ or ‘higher’ to Future Purchase Levels) Based on years of customer research in the IT industry, TNS has found a strong link between ProCLI and annual revenue growth In a recent wave of the TNS Comparative Program for the IT industry, every 10% increase in ProCLI was associated with a 12.5% gain in annual revenue growth the following year Repurchase Intentions Reference- ability Future Purchase Levels ProCLI (2004 Average): 57.5% ProCLI and Component Questions TNS 2004 Summary Data* * The TNS 2004 Summary Data includes all of the ‘Relationship’-level customer satisfaction and loyalty surveys conducted by TNS throughout 2004. The ProCLI average shown was drawn from 59 different studies covering 23,605 respondents.