Good Governance in Expense Management Through Better Commerce

Agenda • Current Business Challenges • Ideal state and Impediments • How do we address these challenges? • Case Studies

The Business Commerce Problem…Investments Inefficiencies Remain Between Companies Average number of trading partners:134,500(Source: Forbes Global 2000) Transactions completed manually:80%(Source: Celent Communications) Paper-based invoices and payments:85%(Aite Group: Global Cash Management: Going Green. 2009) Costs of ineffective collaboration:$650 Billion(Source: Basex Research- “Information Overload” Feb, 2008) Inefficient Commerce Collaboration is Costing G2000 $338 Billion(Source: Ariba Benchmarking) Wasted time and resource Lost negotiation history Poor visibility into compliance Manual ad hoc collaboration Delayed payment; Cash“mis-mgmt” Limited visibilityand risk ERP or Niche ERP Source Procure Pay Buyer Sell Fulfill Invoice & Collect Seller CRM Order Mgmt. ERP 3 3 © 2010 Ariba, Inc. All rights reserved. © 2010 Ariba, Inc. All rights reserved.

Sales & Marketing Procurement Finance • How do I ?????? • Bring More Spend Visibility • Improve Strategic Sourcing • Identify and Manage Supply Risk • How do I ?????? • Reduce Operating Expenses • Optimize Working Capital • Improve Organizational Agility • How do I ?????? • Identify New Business • Expand the share of wallet within my existing customers • Reduce Cost of Sales BUY BETTER SELL FASTER MANAGE CASH …Creates Challenges in Controlling Expenses across the Organisation…… Increased COGS Increased Sales Costs Ineffective WCM © 2010 Ariba, Inc. All rights reserved.

Why Buy, Sell & Manage Cash are so very relevant ??? Buy Better Sell Faster Buy Better Manage Cash

Agenda • Current Business Challenges • Ideal state & Impediments • How do we address these challenges? • Case Studies

Businesses will operate with Higher Growth Targets Investments funded through Internal accruals Optimal Cost Structures Success requires More agility Variable & flexible operating models Greater responsiveness and collaboration across your value chain “ The enterprise focus on efficiency and cash is clearly seen in the planned cross-functional strategies for 2010.” Source: The Hackett Group, “2010 Procurement Key Issues”. December 2009 “ In Volatile Times, Agility Rules – Flexible capacity and worker skills are essential, but in a context of strategic clarity.” Source: BusinessWeek, “OUTSIDE SHOT”. September 2009 “ 71% of CEOs plan to place greater focus on external partnerships and collaboration that extends beyond the traditional walls of the enterprise.” Source: IBM Global CEO Study 2008; n = 1106 Economy in Philippines is Growing…

IDEAL STATE CHALLENGES BUY BETTER Lets wear the CPO hat! • What if I could… • Quickly discover & qualify suppliers? • Get maximum spend under management? • Drive Compliance to Strategically Sourced Spend? • Collaborate with suppliers without worrying about integration or IT infrastructure? • Why is it… • I am not able to quickly reach a global supply base with Intelligence? • I am unable to have complete spend and process visibility? • Finding it difficult to collaborate with my suppliers??

What Analysts are saying??Key Priorities of a CPO Source: Hackett 2010 Procurement Key Issue Study – Provisional Data

What Analysts are saying??Aberdeen says that 92% increase in savings potential through effective buying

IDEAL STATE CHALLENGES SELL FASTER Lets wear the CSO hat! • What if I could… • Get access to qualified leads? • Access intelligence to increase & speed sales? • Expand share of wallet with existing customers? • Lower my overall costs of sales? SELL • Why is it… • My sales team have a weak pipeline? • My sales team have poor conversation ratio? • My sales team unable to engage during the buying cycle? • My sales productivity poor?

What Analysts are saying?1% improvement in revenues & 20% reduction in sales costs through collaborative commerce process Business Impact of Automation* Sell Faster • Speed – decreasing cycle times by 35% • Eliminate process bottlenecks • Reach out to more potential buyers • One percent increase in overall revenues • Up to 50 percent reduction in contracting cycle times • 20% reduction in sales costs *Source: Aberdeen Group, 2008, 2005 12 © 2010 Ariba, Inc. All rights reserved. © 2010 Ariba, Inc. All rights reserved.

IDEAL STATE CHALLENGES MANAGECASH Lets wear the CFO hat! • What if I could… • Reduce Operating Expenses? • Ensure payment accuracy? • Hold onto my cash longer (Increase DPOs)? • What if I could… • Appropriately Fund Growth? • Improve access to cash & credit? • Get paid faster (reduce DSOs)? • Why is it… • Have no control over my Spend? • Have manual/inaccurate Invoicing & Settlement process? • Increase Supply Risk? • Why is it…. • So difficult to balance Growth and Governance? • So difficult to balance Working Capital?

What Analysts are saying??Key Priorities of a CFO % of Firms Citing Strategies as Critical and Major Priorities Source: The Hackett Group 2010 Key Issues Study

What Analysts are saying???$10 Million in savings for every $1 Billion in Spend through effective Cash Management “ “ 70% Cost Take Out “ “ 40-for-15 “ “ 2-for-1 “ “ 9-for-1 Source: AP Performance Study, The Hackett Group, 2010 15 15 © 2010 Ariba, Inc. All rights reserved. © 2010 Ariba, Inc. All rights reserved.

Collaborative Business Commerce (CBC):There is a better way

Buying Organisations Benefit from CBC Your Commerce Process Results How CBC Helps • 3%-9% additional savings • Increase contract compliance by 55% • Improve supply performance by 25% • Spend aggregation & analysis • Supplier discovery & qualification • Market intelligence & sourcing expertise • Sourcing project & knowledge mgmt. • Flexible negotiations (RFx, auction, etc.) • Contract & supplier management • Speed req-to-order cycles by 80% • Cut processing costs by 50% • Reduce maverick buying by 70% • Catalog search & requisitioning • Workflow & approval routing • Services procurement • Catalog & supplier enablement • Transaction and collaboration mgmt. • Reduce processing costs by 60% • Increase discount capture by 90% • Extend Days Payable Outstanding (DPO) • Touchless invoice processing • Dispute and exception management • Dynamic discount management • Supplier enablement management • Supply chain finance and compliance 18 © 2010 Ariba, Inc. All rights reserved.

Sellers also Benefit from CBC How CBC Helps Your Commerce Process Results • New business opportunities with largest buying community • High-impact marketing prgms • Qualified leads • Greater exposure in accounts • Contract Management • Increase revenues by 60% • Grow wallet share by 30% • Increase sales efficiency by 20% • Improve order accuracy by 80% • Cut process costs by >60% • Decrease error rates by 50% • Catalog & customer enablement • eStore extension with PunchOut • PO and catalog collaboration • Reporting and dashboards • Speed collection cycles by >50% • Reduce processing costs by >60% • Reduce Days Sales Outstanding (DSO) • Support PO-Flip™, online forms, EDI and paper invoices • Validate invoices upon submission • Receivables financing options • Simplified online profile, bank, and contact information management 19 © 2010 Ariba, Inc. All rights reserved.

Req to PO AR Process Sourcing WCM & Discount Total Savings Invoice Process Compliance Faster Payment Total Savings Increased Revenues Processing Orders Sales & Marketing CBC Drives enormous value to both Buyers and Sellers Seller Value Buyer Value 15-75% TimeSavings 15-75% Process Savings 5-32% Revenue Increase $3-20 Savings/ Document 1-8%SpendSavings 3-9% Savings

Ariba Snapshot 2010+ Breakthrough Innovations 2006 • The leading provider of Collaborative Business Commerce solutions • 90+ of Fortune 100 Companies use Ariba • 4.5M+ paying subscribers from >25,000 global companies • The World’s Largest Web-based global trading community • Incl. >325,000 buyers, sellers, service providers; USD 140 Bn in commerce • Global services and expertise 2003 2001 1999 SaaS 1996 Spend Management Collaborative Business Commerce Supplier Network Procurement © 2010 Ariba, Inc. All rights reserved.

Ariba has a massive footprint in Asia Pacific as well…

MANAGECASH BUY SELL TECHNOLOGY Applications Spend Mgmt. | Collaborative Finance Mgmt. | Sales Acceleration Mgmt. Platform Analytics | Security | Performance | Integration | Mobility COMMUNITY Peer Collaboration World’s Largest Trading Network Partner Ecosystem CAPABILITIES Domain Expertise Value Enablement Execution Support Ariba: Better Commerce Ariba is the leading provider of Collaborative Business Commerce solutions,driving more efficient and effective commerce between companies. The Ariba Commerce Cloud is a web-based platform that enables companies to better Buy, Sell, and Manage Cash, in order to: • control costs, • increase sales, • minimize risk, and • enhance cash flow and operations. … just plug in and tap the resources you need as you need them…

Savings of more than USD 4 Mn (20% across different categories) in the first 3 Months! Set to achieve 1.3 times the targeted savings in Year 1 Driven 100% visibility to Spend Reduction in suppliers by 45% BUY BETTER Comprehensive Approach Yields USD 4 Mn in savings in 3 Months! Company A leading Bank in SEA Profile Complex operations – Retail, Corporate & Investment Banking Ariba Commerce Cloud Features Ariba Sourcing Solutions, Ariba Contract Management solutionsAriba capabilities Challenges Solutions Results • 10% operating margin goal • Phased cost reduction of USD 10 Mn, then 15 Mn, then USD 15 Mn over the next 3 years • USD 150 Mn in annual spending (150,000 invoices) • Deployed Ariba Sourcing and Contract Management technology to close the loop from analyze to contract • Deployed Ariba Contract Management technology to link negotiated agreements with purchases • Deployed Ariba Capabilities to drive adoption & deploy best practices © 2010 Ariba, Inc. All rights reserved.

Network + Ecosystem Increase Sales by 20 Percent 20 percent year-over-year growth without incurring additional cost of sales or order management costs Gained national sales exposure although sales organization regionally focused 65 percent new client growth directly from Ariba Supplier Programs 50 percent increase in product line expansion with current clients 95 percent paperlesstransactions SELL FASTER Company MarkMaster, Inc. Profile Manufacturer of marking and identification products for Fortune 500 companies Ariba Commerce Cloud Features Ariba Network for business collaboration Ariba online catalog solutions Challenges Solutions Results • Manual, paper-based transactions were inefficient and costly • Gaining market share with limited budget • No IT resources to develop electronic transaction capabilities • Deployed Ariba technology to enable prospects to buy electronically • Online catalogs • Paperless invoicing, status updates and automated ship notices • Obtained Ariba Ready silver-level certification to validate MarkMaster’s online commerce capabilities • Used Ariba Network to solidify existing relationships and develop new opportunities “Being an online commerce expert has solidified our existing customer relationships, enhanced trust, and opened up many opportunities for new business. As an Ariba Ready Silver member, we have been able to expand our marketing opportunities to include events and exposure opportunities, regularly participate in Ariba LIVE, and last year alone picked up three new high-profile clients that total $1 million in sales over a 12-month period.” Craig Moore, Customer Relations Manager, MarkMaster, Inc. © 2010 Ariba, Inc. All rights reserved.

Increased early payment discount capture to greater than 90% Increased early payment discount agreements by 20%, Increased average discount to 1.5% (24% APR) Capturing discounts for 4% of targeted spend Over $1M in annual savings MANAGECASH Discount Capture Increased to >90% Company Sports Equipment Manufacturer Profile One of the world’s largest sports equipment manufacturers with global direct and channel retail outlets. Ariba Commerce Cloud Features Working Capital Management solutionsDiscount Management services Challenges Solutions Results • $600 million in spending across 260 suppliers • Services spending very complex (marketing, retail stores …) • Broad inability to take advantage of early payment discounts • Few negotiated agreements • Low capture rate (35%) • No opportunity for discount after initial discount day (i.e. day 15 for a 2%/15 net 45 term) • Unable to capture ad-hoc discounts • Deployed Ariba technology to automate manual processes and capture discount opportunities. • Utilized Ariba services to speed implementation, optimize processes, and improve ability to act on discount capture. • Automated discount-related supplier interactions • “Always Accelerate” & Ad-Hoc features • Accelerate terms to every supplier • Pro-rated term sliding scale to maximize capture © 2010 Ariba, Inc. All rights reserved.

Good Governance in Expense Management Through Better Commerce