1. New Year, New Approach: Take Your Integrated Business Planning Processes to the Next Level in 2014 January 28 2014 Steelwedge Webinar 28,kpmg.com

2. KPMG Presenters: Frank Kang and Peter YuBackground Frank, a managing director in KPMG Advisory Services, has 21 years experience in supply chain transformation consulting experience in the Electronics, Consumer Packaged Goods, Retail, Retail Industrial Products and Telecommunications Industries He leads KPMGs offering in Products, Industries. KPMG s integrated business planning, inventory optimization and supply chain analytics..Frank Kang Managing Director, Supply Chain and Operations Advisory S i O ti Ad i Services KPMG LLP, Washington, DC area office Tel 415-577-1804 fkang@kpmg.comFrank has extensive experience working with multinational firms attempting to achieve greater supply chain integration into emerging markets. He has been a speaker at numerous global conferences focusing on supply chain strategy, planning, visibility, analytics and sustainability. Prior to KPMG, Frank was with IBM GBS, PwC Consulting and Booz Allen & Hamilton. Frank holds graduate and undergraduate degrees in Operations Research from Cornell University. Background g Peter, a director in KPMG Advisory Services, has 15 years experience in supply chain transformation consulting experience in the Hi-Tech, Consumer Packaged Goods, Retail, Industrial Products, and Automotive Industries. He has expertise in Integrated Business Planning (IBP/S&OP) process improvements, and currently one of the leading members of IBP/S&OP offerings at KPMG.Peter J. Yu Director, Supply Chain & Operations Advisory Services KPMG LLP, Chicago, Office Tel 312-665-1397 pjyu@kpmg.comPeter also has a strong background in global supply chain processes and systems management with a focus on advanced supply chain planning (Global Demand, Supply, Inventory, Capacity Planning) across number of industries improving their operations and business performance. Peter holds graduate and undergraduate degrees in Industrial & Operations Engineering and Computer Science from the University of Michigan, Ann Arbor. 2014 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent 2013 member firms affiliated with KPMG International Cooperative (KPMG International), a Swiss entity. All rights reserved. NDPPS 161986 161986 NDPPS1 3. KPMG Advisory OverviewU.S. Advisory Approximately 7,000 dedicated professionals490 partners/MDs10 service lines35 service networksAmericas Over 7,000 dedicated professionalsEMEA Over 20,000 dedicated professionalsAsia Pacific Over 5,000 dedicated professionalsMore than 30,000 talented professionals across a worldwide network Wherever our clients need us100+ global methods and toolkits to bring knowledge of the firm to each clientAdvisory areas: Management ConsultingRisk & ComplianceTransactions & RestructuringAnd we offer clients the benefit of working with a professional services firm that draws upon the skills and experience of 140,000 audit, tax, and business advisory colleagues across 146 countries. 2014 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent 2013 member firms affiliated with KPMG International Cooperative (KPMG International), a Swiss entity. All rights reserved. NDPPS 161986 161986 NDPPS2 4. Agenda Questionsto address when evaluating the effectiveness of your planning processes and deciding where and how to start on an effective IBP journey LeadingIBP Operating Model capabilities Theopportunities offered by the right technology to continuously improve your business planning processes Q&A 2014 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent 2013 member firms affiliated with KPMG International Cooperative (KPMG International), a Swiss entity. All rights reserved. NDPPS 161986 161986 NDPPS3 5. IBP questions we will address throughout this webinar1) What is IBP and how is it different than S&OP? 2) How do you start an IBP transformation journey? What y g are some key considerations when embarking on an IBP initiative? 3) Who should own the IBP process? 4) What are the leading capabilities firms need to drive an effective IBP process? 5) How can you assess your current IBP maturity level? 2014 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent 2013 member firms affiliated with KPMG International Cooperative (KPMG International), a Swiss entity. All rights reserved. NDPPS 161986 161986 NDPPS4 6. IBP v. Traditional S&OPBusiness Strategy ScenariosFinanceExecutive IBPPrimary Focus of Traditional S&OPDemandCustomer CollaborationSupplyDevelopment: Products/ Services 2014 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent 2013 member firms affiliated with KPMG International Cooperative (KPMG International), a Swiss entity. All rights reserved. NDPPS 161986 161986 NDPPSSupplier Collaboration 5 7. Challenges with business planningThe current globalization of the supply chain, heightened competition, and increased customer requirements have hindered business performance using traditional planning process: IssuesCharacteristicsRepresentative KPI ImpactsUnreliable financial forecasts as they are often not based on accurate profitability analysis. Financial forecast and operations plan misalignmentMisalignment/Disconnect between financial plan and operational plan due to the lack of consistent collaboration with sales & marketing, supply chain, and ll b ti ith l k ti l h i d finance Difficult to understand where the gap isDelayed New Product Introduction (NPI) and End-ofLife (EOL) due to lack of integration into Demand & Supply Planning and Execution Unable to meet market demands fast enough Unable to plan and control EOL product inventory RevenuePoor sales & marketing promotion planning effectiveness due to lack of integration into demand planning, inventory execution, and budget allocation Unclear benefit of promotions Promotion ROI Negative impact on materials planning Revenue/Costy pp y Lack of visibility on critical and chronic supply issues (suppliers repeated de-commits, no dual-sourcing strategy) On-going critical shortages g g g Customer Service Unclear n-tier supplier issues Revenue/CostBusiness units and functional areas with their own agendas therefore organization have difficulties aligning the operations Unaligned business targets Revenue/Cost Difficult to achieve strategic objectives Customer Service 2014 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent 2013 member firms affiliated with KPMG International Cooperative (KPMG International), a Swiss entity. All rights reserved. NDPPS 161986 161986 NDPPS Financial forecast accuracy Overall financial performance Customer Service Inventory6 8. IBP principle #1: An IBP strategy must harmonize financial and operational processes to customer demand Harmonize the Planning Process: Right product, right place, right time, right price at the right cost Maximize revenue while simultaneously minimizing operating expense and investmentImprove customer service pCapture market shareCollaborate with global and local operations to address market needs Demand shifts Supply changesPromotionsNPIEOLIllustrative Hug the Demand Curve Hug Curve Demand $RecoverySupplyLost Opportunity & Shareholder $ Value Recession 20052007 2014 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent 2013 member firms affiliated with KPMG International Cooperative (KPMG International), a Swiss entity. All rights reserved. NDPPS 161986 161986 NDPPS2009Time 201120137 9. IBP principle #2: An IBP strategy must enable an organization to optimally collaborate and address critical, cross-functional business decisions across a products lifecycleSupply ChainSales & MarketingHow can we source, source produce, and deliver products on-time?What is the forecasted demand and can it be fulfilled?How can operations achieve greater scalability and cost reduction?What is the achievable customer service based on sales strategies and fulfillment capabilities?PLM Product DevelopmentFinanceHow is the product aligned to customer need?Is the product achieving profitability targets?How can we consistently achieve on-time product launches?How can we achieve greater financial forecast accuracy? 2014 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent 2013 member firms affiliated with KPMG International Cooperative (KPMG International), a Swiss entity. All rights reserved. NDPPS 161986 161986 NDPPS8 10. IBP principle #3: An IBP strategy must create cross-functional alignment and integration of planning and execution processes to ensure optimal business performance Align operational planning and execution to strategic corporate objectivesIntegrate the executive team, finance, sales & marketing, supply chain, and product development to drive real cost reduction and customer service excellence 2014 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent 2013 member firms affiliated with KPMG International Cooperative (KPMG International), a Swiss entity. All rights reserved. NDPPS 161986 161986 NDPPSIncreased on-time delivery of products and servicesReduction of operating expenses & inventory yImprovement in budgeting and costing accuracyLeverages greater utilization of information for scenario management, analytics, and reporting 9 11. Agenda Questionsto address when evaluating the effectiveness of your planning processes and deciding where and how to start on an effective IBP journey LeadingIBP Operating Model capabilities Theopportunities offered by the right technology to continuously improve your business planning processes Q&A 2014 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent 2013 member firms affiliated with KPMG International Cooperative (KPMG International), a Swiss entity. All rights reserved. NDPPS 161986 161986 NDPPS10 12. KPMGs recommended Integrated Business Planning (IBP) operating model KPMGs IBP Operating Model balances demand and supply, integrating product lifecycle and financial goals, with key enabling processes and capabilities that support the operating model Business Integration and StrategyProcess Integration & CollaborationFinance Governance and CompliancePlanning and Optimization FinancialsSuppliersOperationsSupplyBalanceDemandSales and MarketingCustomersProducts Change g ManagementAnalytics and y Reporting Product LifecycleTechnology Enablement and E bl t d Infrastructure 2014 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent 2013 member firms affiliated with KPMG International Cooperative (KPMG International), a Swiss entity. All rights reserved. NDPPS 161986 161986 NDPPSEnd-to-End Supply Chain Visibility11 13. IBP operating model establishes leading capabilities across the planning process to meet the needs of todays corporationsIBP Capability CategoriesLeading CapabilitiesDescriptionBusiness Integration & StrategyImproved ability to use business drivers in planning, collaboration, and execution is planning collaboration achievedProcess Integration & CollaborationBy integrating process across finance and operations, greater cross-functional collaboration and functional alignment can be achieved to drive improve business performanceGovernance & ComplianceManage and control the IBP operating model, coordinate and balance decision-making globally vs. regionally vs. locallyChange ManagementContinuous process improvement is essential to successful integrated business transformation with demand planning, supply, product management and financeEnd-to-End Supply chain VisibilityIntegrated Planning ActivitiesProcess Governance and Continuous ImprovementIncreased Planning VisibilityRobust technology that enables integrated business planning process with real-time information visibility regardless of IT platform configurationOptimized Business Decisions Through AnalyticsTechnology Enablement & IntegrationPlanning OptimizationIBP optimization across financial, operational, tactical, and strategic plans through advanced analytics for increased effectiveness, standardization and consistencyAnalytics & ReportingEnables single version of the truth of the extended supply chain by providing actionable real-time data across finance, transactional and planning platforms 2014 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent 2013 member firms affiliated with KPMG International Cooperative (KPMG International), a Swiss entity. All rights reserved. NDPPS 161986 161986 NDPPS12 14. End-to-end, cross enterprise financial and operational visibility is an important enabler of IBPIBP is capable of providing visibility across the entire supply chain network. A complete view of current activity and future plan from inbound supply and outbound fulfillment activity across supply chain network Supply & Inventory Visibility Real time inventory across the globeSupply-demand Supply demand disconnectsCollaborative planning (multi-tiers)Production / Capacity capabilityTransportation and logisticsFinancial VisibilityDemand Visibility Profits and marginsCustomers PricingSales & Marketing Working capitalPoint of sales Cash flowPromotion plansAsset ManagementProduct lifecycle: NPI and EOL 2014 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent 2013 member firms affiliated with KPMG International Cooperative (KPMG International), a Swiss entity. All rights reserved. NDPPS 161986 161986 NDPPS13 15. IBP reference architecture is an integrated and agile process enabled through technology advancesDemandSupplyExecutiveConsensus DemandIBP ProcessesConstrained SupplyExecutive ReviewIntegrated Business Planning Demand, Supply & Financial Integration , pp y gIBP Technology EnablementDemand, Supply & Finance Data Point Solution TechnologyDataForecasting, Demand Plan, ERP, CRM, ExcelSCM, ERPDemand Products & CustomersSupply Products & Suppliers 2014 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent 2013 member firms affiliated with KPMG International Cooperative (KPMG International), a Swiss entity. All rights reserved. NDPPS 161986 161986 NDPPSBusiness Intelligence, Data WarehouseRevenue, Units14 16. 2014 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (KPMG International), a Swiss entity. All rights reserved. NDPPS 161986 The KPMG name, logo and cutting through complexity are registered trademarks or trademarks of KPMG International.