Risk Anticipation – A must for Financial Performance & Improvement in Contract Delivery

1. May 26 & 27 Risk Anticipation – A must for Financial Performance & Improvement in Contract Delivery Colette CasimirAtos Origin Group Senior Vice President Risk Management, Process & ITMarsh Technology Conference 2005 Zurich, Switzerland.

2. Content • Mission • Anticipation of Risk is essential to our Business • Risk Management approach • Key Prerequisites supporting Risk Management

3. Mission To help the businessWINand DELIVERTimely, on Target PROFITS through theANTICIPATION & Managementof RISK

4. Philosophy The damage in most contracts is donebefore contract signatureor in the first few weeks of the contract • What risks do we take KNOWINGLY? • Risk Management is everybody’s responsibility • Early identification is best: Prevention is better than cure • Avoid Bad Surprises. Bad News are allowed • Hidden risks are dangerous risks: Do not be risk averse • People’s attitude and not process alone will make it work • Output is more important than the process • Reduce the Cost of Non-Quality • Apply a Pragmatic approach

5. Risk Taking is required in our Business • Increasingly competitive business context (conditions, price reduction, penalties, deadlines, quality) • Multiple business partnerships • High stakes (keeping & winning market share) • Complex solutions difficult to estimate in tight schedules • Immature or unrecognized technologies • Strong commitment where functional & technical scope moves • Highly demanding clients requiring flexibility MOST OF THE TIME increasingly high levelsof risk taking is required

6. Risk Management is Essential for our Business • By law, we are obliged to reinforce our internal control in order to provide report to the shareholder • Effective risk management can lead to: • Contract success and profitability • Achievement of margins (or even increase) • Acceptance of system or service by customer • Increased chance of customer satisfaction • Reduced maintenance • Reduce the Cost of Non-Quality • Reduced exposure to penalties and liquidated damages • Effective partner relationships

7. Risk Management aims: Deal with in-depth issues ON WHAT SHOULD WE CONCENTRATE ? Pre-sales • What risks do we take knowingly? • For what stakes? • Have we carefully identified and analyzed them (impacts)? • In what areas should we be particularly vigilant? • What leverage do we have to reduce major risks? Contract • What are the supplementary risks or constraints that we have to face? • What kind of project or service management can we adopt? • Are we clearly addressing and dealing with the major risks and stakes? • Do we anticipate enough and prepare ourselves as a consequence? • Are our action plans pertinent? • Are our actions efficient? • Do the team have sufficient internal support to be successful (Top Management, Network of experts, Legal, Finance …) • Are we working together (Client & us) to circumvent our shared risks? Development & Delivery Managed Operations Permanent Updated Risk Mgt Road Map requiredto allow efficient Anticipation & Mitigation of Risks

8. Risk Management Approach (1/3) • Understanding of Risk Profile • consider both bidand delivery risks • Risk Management and Quality • are independent • have a network for sharing knowledge • take the long view • ensure the right level of risk is taken • listen and inform the business • drive prevention and correction Bids Systems Integration Managed Operations • Immediate High impact • Anticipation • Proactive • Customer and partner • Impact felt over a longer time • Transition and due diligence • Issue management • client perception

9. Risk Management Approach (2/3) • Deployment of Risk Management best practices and processes throughout the company • promoting a risk anticipation culture • installing a natural and proactive attitude at all levels • training Project & Delivery Managers in the basics and fundamentals • coaching by Subject Matter Experts (SME) as leverage in risk analysis and mitigation for Bids, Systems Integration & Managed Operations • develop a realistic set of best practices • Identification of key risk SI projects & MO deliveries from the portfolio and monitor them through SMEs and Risk Committees

10. Risk Management Approach (3/3) • More care taken to include all the risk factors: technical, project & delivery management, customer relationship management, legal, financial • Reinforcement of risk analysis in pre-sales phases, so as to have a non ambiguous global roadmap • More care taken at contract launch and operational start-up • Visibility on the evolution of risks as contract moves forward, and measurement of trends • Unified risk reporting

11. Key Prerequisites supporting Risk Management Strong support and commitment required from the TOP Managers including the Board to ensure efficient results in: • Promoting the mandatory contribution of all Managers insupporting RM approach • Establishing the network of SMEs and to obtain in a timely manner, these experts in order to create dedicated task force to support Bids & Contracts • to guarantee a high level of Risk Management expertise to SI & MO • to ensure confidence in action plans as a result of support and coaching • to improve the Risk Management maturity level of our managers • Establishing the network of RM teams in Corporate/Region/Country • to develop a positive Risk Management mindset in daily project activities • to support / mentor project and delivery managers • to manage a proactive escalation process

12. support & Crisis Mgt The Risk Management: Support, Coordination, Crisis Mgt Support BidManagers Project/DeliveryManagers AccountManagers Corporate RM coordination Region / CountryRM Team Network ofSMEs • commitment • arbitration • due diligence • Crisis Mgt RM: Risk Management SME:Subject Matter Expert TOP Managementincluding the BOARD

13. Technical Directors Project Directors Personnel Finance Delivery Managers RM&Q Managers Customers Partners Legal Technical Experts Solution Architects Technical Architects Sales Purchase Actors in Risk management: SMEs BID Systems Integration Managed Operations SME: Subject Matter Expert

14. Key Outputs 1. Bids: « Risk Profile » Report • major risk status per area • key recommendations & actions 2. Contracts: « Risk Status » Report • major risks & impacts • risk trends per area • mitigating actions 3. Monthly Project Reviews 4. Top Risk Project Reports: RAG Report (RedAmberGreen) 5. Regular Top Risk Contract Committee 6. Risk Audits Clear and Shared Vision to Decide andto Monitor efficient Action Plans

15. Project & Delivery Managers Project & Delivery Managers Local RM Managers Corporate RM Managers Board risk register monthly project  » A » report Risk Reviews Risk Committee extract FINAL RAG Report risk register monthly project « B » report FullRisk Reports High Risk RAG Report risk register extract monthly project « C » report Project / Delivery review risk register monthly project « D » report Involvement of SMEs RM Output: The Global Picture