Supply Chain VALUE CO-CREATION

1. Supply Chain VALUE CO-CREATION Wrap up day 2

2. Plan Make Make Deliver Deliver Deliver Return Return Return Return Return Return Source Source Source Plan Plan Source Make Deliver Return Return Supplier Your Company Customer Suppliers’Supplier Customers’Customer Supply Chain Value Co-CreationConference Framework Bill Davidson • Foundation setting by exploring Emerging market and maturity of these market • What is my company position in key markets? And where are the gaps? • What are the next emerging markets? -> Indonesia / Turkey / Eastern Europe • Martin Christopher • Increasing complexity in supply chain urge us to collaborate with experts but keep control of total supply chain • Co-opetition: Collaboration and competition = Value creation based on Trust STRATEGY INNOVATION COLLABORATION • David Hunt • Strategy: • 1.Emerging markets: China and Brazil • 2. Travel-retail • 3. Direct connection with consumers: Focus on key markets and being in city of consumption EXECUTION

3. Key take aways Client Panel • Emerging markets • Everyone is active in the BRICS countries • Turkey 16 largest world economy, in general to be in the emerging market • Success factors range from type of business> start with distributors vs. own affiliate • Assessment on long-term emerging markets (ie. Vietnam, Indonesia( only starting) • Emerging markets can vary, i.e. manufacturing vs. consumption • Both Innovation and collaboration are key element in a very volatile environment • Successful key elements of last years • Innovation: transfer from manual to automated workload in progress • Collaboration: Outsourcing to 3rd parties and consolidate (even with competition) • Collaboration mostly focused on supplier & logistics partner • Co-opetition is more of a challenge than anticipated< mostly due to legal constraints. Openness varies by industry (ietyres and C&R are open to this) • IT technology • Agility in Supply chain • One standard integrated system • Enabler for SC control and pre- requisite to collaboration

4. Plan Make Make Deliver Deliver Deliver Return Return Return Return Return Return Source Source Source Plan Plan Source Make Deliver Return Return Supplier Your Company Customer Suppliers’Supplier Customers’Customer Supply Chain Value Co-CreationConference Framework STRATEGY Martin Christopher Bill Davidson Bill Davidson Rob den Heijer INNOVATION COLLABORATION Gene Ochi Rod Stout David Hunt EXECUTION

5. Key take away of Rob den Heijer – INCO terms No it is red! Is that a green shirt? • INCO terms could make or brake collaboration through the supply chain (green = green) • Be careful on the risk of loading the truck • The buyer will always pay all costs involved in transport + Insurance -> avoid double payment • Tips: • When EXW or FCA sellers premises is used: do not sign CMR or other transport document, because you will become part of transport agreement • In case of FOB: demand a copy of B/L and make sure you are not mentioned as shipper, otherwise you become liable for transport • If your company has an “umbrella insurance” then incoming flows are likely to fall under this agreement. Choosing CPT as Incoterm could avoid paying double insurance premium

6. Key take away of Rod Stout – technology enabled supply chain collaboration • Intra-entreprise collaboration (S&OP) • Integrated Community Network • Transformational Logistics • Technology is the bridge between third and first world. • Key elements for Future • Technology designed for the next step not adapting existing technology designed around the old paradigm • Communication – lots of it • External facilitation can make a huge difference • Like minded people • Mutual gain • Find ways around the CAPEX barrier • A compelling event really helps • Visionary leadership that will ‘take a risk’

7. Key take away of Gene Ochi • First of all we learned all about toilets • 3 strategy positions • Client intimacy • Operational excellence • Product innovation • Paradox of flexibility and control over time • Trade off on outsourcing or do it yourself (optimization and fulfillment versus cost) • Open business model for open innovation: • Indispensable dialogue • Trust • Goodwill • Create value • 5 things to focus in future • Network design • Optimization (from static (forecasting) to dynamic (agility)) • Compliance • Data to knowledge (integrated) • Relationship

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9. Choosing your innovative engines by Bill Davidson • IBM’s Client-centric Solution model where collaboration and conduct is essential • Decentralized independent groups • Volvo -> 1 business model and departed from consumer automotive business : • Integrated value chain • single supply chain structure • Align design, SC and production • Can we share/collaborate with close competitors • Wal-Mart’s Strategy diamond • Inventory turn  (X-docking) • Innovation starts with starting a new cycle • Perform or Transform • Apple strategy innovations • Virtual integration / Ecosystem/Part to profits cycle/KISS/Black Hole sector strategy • Netting it Out • Numerous Opportunities for Innovation • Supply Chain is particularly fertile ground • Customer Facing process Innovation delivers strong, sustainable results • Business Model Innovation is most powerful and most demanding • Collaboration is critical inside and out • Nothing focuses the mind like a crisis