®

Workplace Strategy Utility Division Meeting

Jim JohnsonJune 21, 2010

Future Vision for Workplace

Recent Council Legacyas a Membership

Organization, a WorkplaceSafety Trainer,

Supplemented by Surveysand Assessments

Vision of Council as a

Workplace Safety Leader:• With knowledge and

practices based on data and statistical analysis

• Led by surveys, assessments, and measurement

• Supported by membership

• Supplemented by training and resources

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Strategic Objectives

Safety Focus

Journey to Safety Excellence

• Reduce workplace injuries - 5 year goal of 400 lives saved and

480,000 injuries prevented

• Reduce non-fatal injuries by risk category- Overexertion, slips, trips, falls

• Reduce fatal injuries by risk category- Motor vehicle, falls from heights

• Impact safety off the job

• Leadership, Engagement and Culture- Employee perception surveys- Leadership workshops

• Safety Management Systems- System assessments- Best practices and skill/knowledge transfer

• Risk Reduction- Improvement action management- Non-fatal and fatal target risk solutions

• Performance Measurement- Safety workbench guiding safety process

Target Market

Financial

• Advocate for small and mid-sized (<1,000 employee) bringing best practices and effective tools

- Research, Campbell, World Class Team, Customer best practices, data studies

• Increase impact by reaching more organizations and more workers

• Safety partner for large organizations where we can support and enhance

- National leadership in applying best practices

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• Strong year over year growth- Revenue from surveys, assessments, online,

workbench an increasing % of total

• Meeting target return on revenue- Strategy for reinvesting in advocacy and

enhancements to workplace business

• Long term objective of exceeding $10MM revenue (scale)

• Recognition as the number one provider for midsized and small market segments

Leadership, Engagement& Culture

Safety Management Systems Risk Reduction

Performance Measurement

Leadership, Engagement& Culture

Safety Management Systems Risk Reduction

Performance Measurement

Develop Improvement Plans

“Apply Best Practices”

Develop Improvement Plans

“Apply Best Practices”

Determine Gaps & Set Goals

“Vision for What Could Be”

Determine Gaps & Set Goals

“Vision for What Could Be”

Capture Lessons Learned

“Enhance Best Practices”

Capture Lessons Learned

“Enhance Best Practices”

Implement Plans & Manage Improvement

“Close the Gap”

Implement Plans & Manage Improvement

“Close the Gap”

Measure/Re-measure (Survey & Assess)

“Baseline & Improvement over

Baseline”

Measure/Re-measure (Survey & Assess)

“Baseline & Improvement over

Baseline”

Tools for the Journey to Safety Excellence

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Competition

Safety market is highly fragmented . . .

Small (?)

Medium (16)Large (7)

Major (3)

5 Source: Business Insurance Annual Listing of Safety Consultants (August 24, 2009)

Safety SafetyCompetitor Revenue Competitor Revenue

Bureau Veritas 510,929,000 Chubb Services Corp. 860,000 DuPont Safety Resources 200,000,000 Five Star Risk Management Services 800,000 Marsh-Risk Consulting Practice 112,400,000 Safety Dynamics Group 458,000 Major Players $823,329,000 Safety Consulting Inc. 400,000

Easy Safety Solutions 375,000 ATC Associates Inc. 52,741,832 Reliability Group 350,000 ESIS Inc. 28,750,000 Loss Control Associates Inc. 290,000 Liberty Mutual Group-Commercial Market 19,700,000 RPF Associates 220,000 E4Safety Professionals L.L.C. 14,670,000 AcceptableRisk 215,000 Safety Management Group 12,585,350 CompManagment Inc. Risk Services 200,001 Regional Reporting Inc. 12,000,000 Other 459,407,469 Safety Resources 10,494,696 Total Small $463,575,470

Large Players $150,941,878 Estimated Workplace Safety Market 1,500,000,000 $

Gallagher Bassett Services Inc. 7,940,000 Training and ConsultingF.A. Richard & Associates Inc. dba FARA 7,865,000 Risk Consultants Inc. 7,200,000 FDRsafety L.L.C. 6,500,000 PSRG Inc. 5,500,000 CAS-Claims Administrative Services Inc. 3,835,290 National Safety Council 3,500,000 Conner Strong Risk Control 3,260,000 Zurich Services Corp. 2,960,000 Strategic Safety Associates/MoveSMART 2,847,035 Bickmore Risk Services & Consulting 2,830,082 Applegate Associates, A Safegate Co. 2,100,000 Meadowbrook Inc. 2,069,000 Network Safety Consultants Inc. 1,275,000 Safety Alert Network Inc. 1,250,000 PMA Management Corp. 1,222,245 Medium Players $62,153,652

MM

MM

MM

MM

$

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The Environment

Issues Opportunities

• Current NSC market approach is highly transactional . . . Commodity products

• Training content is underinvested . . . Go forward investment resources are limited

• Online capability for training is significantly behind competitors . . . NSC 0% Web delivery, some competitors 100%

• No electronic delivery of product

• Widely divergent operating models for independent chapters

• COC training delivery model costly . . . Few trainers, high travel

• New leadership and recognition of need for increased investment

• Workplace is the foundation of NSC . . . High brand recognition

• Profitable and high quality existing business for survey . . . Potential for consulting

• Larger competitors focused less on midsized and small organizations

• Insurance companies and brokers have pulled back from small and medium sized customers . . . Focus on risk assessment for underwriting

• NSC COCs in states with high worker populations (CA, TX, GA, N.FL, IL) and strong distribution network through membership base and Independent Chapters

• Increasing recognition of the value in measurement, data, and software solutions (“workbench”)

• Strong potential for partnerships that add high value

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Strategic Objectives

Core Strategic Offering Approach for Execution

Survey / Assess / Consult• Existing survey and safety system assessment• Gap and goal definition• Improvement plans• Alignment of resources• Call center “Safety Help Desk”

• Survey product is best in classImprove follow through with customer

needsGrow midsized and small through increased

automation• Enhance assessmentsProvide self-assessment in Workbench as

well as onsite• Consult to support improvement processPreferred Provider Network for on-site

work and support

Knowledge / Skill Transfer• Increase online content with long-term goal of blended learning in classrooms, onsite and online• Modular content, mix and match to individual needs including blended• Develop leadership & behavioral workshops

• Partner with an online provider for immediate offerings and revenue

• Partner with a leadership / behavioral provider and develop co-branded offering

• Leverage online partner resources for NSC content conversion

• Currently negotiating with Summit and BST, Terms & Conditions TBD

Tools – Safety Workbench Software Solution• Data capture and management tool• Guides business process for safety• Assists with benchmarking• Measures performance• Manages improvement, tracks compliance

• Partner with a software company• Design fixed functionality for small / mid-

sized organizations and customize for large• Leverage partner to host technology• Terms & Conditions TBD

Knowledge, Value, RelationshipKnowledge, Value, Relationship 7

Developing capabilities to

support the improvement

process

Determining where you are and where you

need to go

Managing the improvement

process

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Strategy Implementation

2011 2012 2013 2014

Survey / Assess / Consult• Continued strong growth • Assessment update/process• Marketing/sales push

Knowledge / Skill Transfer• Partnership contract• OSHA 10/30 hour online• OSHA compliance online• Complete course / content plan• ASC initial online transition• Special projects (e.g. USMC)

Tools - Safety Workbench SoftwareSolution • Partnership contract• Safety / business process• Pilot (COC)• Congress rollout

PPO• Contracts and negotiated rates in

place• Certified, tested• Metrics established• Quality control

Center of Excellence(Advocacy) • Knowledge management and

sharing plan• Technology plan

Survey / Assess / Consult• Build volume of midsized and

small customers• Increase use of online admin of

surveys• Growth of SMS assessment

business, online & onsite (provider)

Knowledge / Skill Transfer• Progress with course/content plan• Continued ASC online transition• Emergence of adaptable, blended

models• Conversion to e-product vs.

warehousing of hard product• Virtual symposiums and webinars

Tools - Safety Workbench SoftwareSolution• Building volume, initial renewals• Benchmarking tools• Strengthen tie to supporting

offerings (content, training)

PPO• Monthly provider tracking• First contract renewals• Metrics updated• Provider forum (webcast)

Center of Excellence • Pilot (COC)• Advisory Board (World Class

Team)• Incorporation of valued outcomes

from Campbell and Executive Edge Track

Survey / Assess / Consult• Confidence in renewable

customer base• Refinement / expansion of SMS

assessment tools• Continued increase as % of total

workplace revenue

Knowledge / Skill Transfer• Online continues to increase as

% of total training revenue• E-product continues to increase

as % of total product revenue• Evidence of adaptations to

evolving technology

Tools - Safety Workbench SoftwareSolution• Emerging as major revenue line• Track record of renewals and

new subscriptions• Continued enhancements

PPO• Continued growth in revenue

served• Incremental NSC staff growth to

manage provider teams and customer business

• Possible industry specialization, technical specialization

Center of Excellence • Online with hit tracking• Quality control plan for content

management• Statistical studies from

workbench data• Basis for advocacy work

Survey / Assess / Consult• Significant % of total workplace

revenue• Recognition as high quality,

trusted, reliable partner with consulting based on data driven best practices

Knowledge / Skill Transfer• Online a significant % of total

training revenue• Solid onsite, dedicated training

business• Classroom managed as a quality

compliment to online and onsite

Tools - Safety Workbench SoftwareSolution• Substantial subscriber base with

strong renewal and net gain• Significant other revenue driven

from tools (e.g. training)• User conference

PPO• Global network recognized by

the NSC brand and distinguished for quality, trust, reliability

Center of Excellence • Continued growth in use• Recognition as among the best

in class for similar offerings• Recognized as a preeminent

source of best practice, reliable solutions and results driven advocacy.

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New ProductsOnline Training and “Safety Workbench” partnerships

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Evaluate NSC classroom courses in relation to providers online course content and create plan for online development

OSHA 10 hour / 30 hour construction / industry training (Spanish for industry) for immediate offering

OSHA compliance series for immediate offering Evaluate other partner courses for potential offering Evaluate potential for use of partner’s Learning Management System Create branded web site and define business process (online orders, payment, etc.) Final agreements and terms and conditions by June 1, 2010

Service Bureau model (NSC as primary license holder and administrator) Annual subscription, standard pricing and member discount (renewable revenue) Net growth goals from high percent retention and new subscribers No partner cost based on revenue share model Call center model for phone consultation, preferred providers for onsite consultation Potential for additional revenue through aligned resources and training Data for research, push of analysis reports to add value, offer of additional functionality for additional fee Partner selection and terms and conditions targeted for July 1, 2010 Attempt to complete pilot and obtain initial subscriptions with formal rollout at Congress

Online Training Partnership

“Safety Workbench” Partnership

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New Products

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Provider contract prepared and ready for use Government, Western, Central, Northeast and Southeast candidates identified Continued identification of additional quality providers Coordination with International for global provider network Re-qualify existing providers Negotiate rates and finalize contracts Annual contract renewal with updated rates negotiated Develop quality control program and evolve NSC safety consultant role for provider oversight

Preferred Provider Organization

Questions?

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