Lean Finance Project Implementation Planning Session PRE-READ DOCUMENT January 5-7 , 2010

1. Lean Finance Project Implementation Planning Session PRE-READ DOCUMENTJanuary 5-7, 2010

2. BCG Initiative • Introduction – project background • Pre-project Planning • Business Case • Key Success Criteria • Execution and Control

3. 8 Steps of Leading Change • Act with Urgency – crisis / opportunity • Develop the Guiding Coalition • Develop a “Change” vision • Communicate the Vision – get buy in • Empower Broad Based Action • Generate Short Term Wins • Don’t Let Up – support change agents • Make Change Stick for Success

4. Pre – Project Management • Have a burning platform • Why are we doing this, really? • Build executive commitment • Set the foundation for the team • Who will the key players be? • Does the project make sense, really? • Build a “no bull” business case

5. Masco ERP Implementation Methodology /Approach Deliver Vision Plan Design Build CRP Pilot Rollout Operate BusinessCase Value • The Value thread focuses on helping an organization identify and realize both the tangible and intangible benefits of an ERP initiated business transformation project. Its objective is to allow the true business value to be accurately evaluated. • The People, Change and Learning thread comprises an integrated series of activities that guide the impacted portions of an organization caused by changes experienced during a system implementation project. • The Process and Package thread integrates industry knowledge to help a business unit implement enhanced and new business processes. Its objective is to help the business unit make the transition from its current environment to an improved one by identifying, designing, and implementing process improvements. • The Business Intelligence (BI) Thread is responsible for organizing, tracking, developing and delivering information, processes and technology critical to business analysis and decision making. The goal of this thread is to ensure that the decision support solutions provide timely, dependable, logical and flexible reporting and analytics to an organization. • The Information Technology (IT) thread defines all the tasks and deliverables necessary to create the right technical environments to host the complete ERP software including all legacy interfaces and support processes. • The Security & Controls thread focuses on designing and implementing security and controls to ensure reliable financial reporting, operational efficiency and effectiveness, and compliance with laws and regulations. • The Tax thread focuses on the identification of tax requirements across the enterprise and the development of integrated tax solutions. The objective of this thread is to ensure the enterprise solution enables and supports strategic tax planning and positioning. • The Support thread focuses on achieving an optimal support solution for the client. Support models are evaluated closely to determine the best fit based on both immediate and longer-term support needs. • The Project Management thread provides the infrastructure and tools for planning, integrating and managing the project. The objective of this thread is to ensure that client expectations are met within the approved scope, budget and timeline. This also includes a Corporate Governance function described in an attached page. People, Change& Learning Processand Package BusinessIntelligence Information Technology Securityand Controls Tax Support ProjectManagement

6. BCG Six Month Startup Schedule I Six internal team members selected to perform the business case process and serve as the nucleus of the project team Selected Deloitte to assist in business case development

7. Business Divisions 4 Locations 29 Countries 1 Site Operations 42 Functional Process Groups Information Technology Function Areas 13 Business Processes 146 Process Instances 611 BCG Users 1,700 Supported Instances 826 Unique Apps 100+ External Users 1,300 Portal (Est.) 2,500 BCG Transformation: Current View The business and IS model currently at BCG operates as two unique companies with two distinct brands. • Multiple operating models • Corporate - Adrian and Duncanville • Component – Merillat and Quality • Assembly – Merillat and Quality • Branch – Merillat, Quality, Both • Multiple Application Instances • 100+ Applications • 800+ supported instances of applications • Process instances are localized versions of processes

8. MS Access JD Edwards Friedman Excel Friedman Q20E M2OE JD Edwards MS Access MS Excel Data Warehouse EZ- CAB txnotes Pre Order Management EZPrint Masco MBA RightFax Intelli-Quote AOC Friedman Istatus Friedman-Parrish Friedman JD Edwards Pro Engineer Macro Express Inventor Excel Excel UNIX Shipping Friedman Concur EPM APC – Flex Automation JD Edwards Built To Track Time & Attendance MS Access Masco-SRM Excel BTT Minitab Data Warehouse Friedman MS Access Bar Code Scanning Data Pak Data Warehouse MRP Spreadsheet Server MBIZ CAR Works Active Pay Mini MRP XES Excel Friedman At Road Williams Excel Quick Book Rform SAM Track-IT JD Edwards Friedman AS/400 - Legacy AS/400 - Legacy AS/400 - Legacy AS/400 - Legacy AS/400 - Legacy AS/400 - Legacy AS/400 - Legacy AS/400 - Legacy AS/400 - Legacy AS/400 - Legacy AS/400 - Legacy AS/400 - Legacy FAS Global CAR Dataware House MS Access Spreadsheet Server Oracle Applications/Tech Other Office Apps Custom Developed App Business Systems Architecture – As-Is Business Systems Architecture – To Be “ We need a foundation on which we can grow our business ” “ Our business model has evolved but systems have not caught up ” Market to Prospect Quote to Cash 20 / 20 Metreo PlanIT Fusion MapInfo MBIZ DocLink Design to Release Demand to Ship Procure to Pay AutoCAD Auto EDMS Yield Optimization Forecast to Plan Micro Main/MP2 Transportation / Logistics Schedule to Install Rfile Finance / Human Resources PeopleSoft Hyperion Legacy or Package High Cost – High Risk! High Value – Low Risk!

9. Design to Market to Quote to Procure to Forecast Release Prospect Cash Pay To Plan Key Business Process Areas Demand Schedule Financials Transportation to Ship /Logistics to Install /HR BCG Transformation: Future View The future enables BCG to operate a “One Model” concept with common business and Information System models. External External Future Future BCG BCG Focus Focus Synergies Synergies New New Merillat Merillat Quality Quality Businesses Businesses New New Acquisitions Acquisitions Design to Design to Market to Market to Quote to Quote to Procure to Procure to Forecast Forecast CABINET & CABINET & Release Release Prospect Prospect Cash Cash Pay Pay To Plan To Plan Customers Customers RELATED RELATED PRODUCTS PRODUCTS Key Business Process Areas Key Business Process Areas PLATFORM PLATFORM Demand Demand Schedule Schedule Financials Financials Common Common Transportation Transport. Suppliers Suppliers to Ship to Ship /Logistics /Logistics to Install to Install /HR /HR Process Process Vision Vision Portal Portal Common Application Platform Common Application Platform Carriers Suppliers (Oracle + Few Key Applications) (Oracle + Few Key Applications) Masco Masco Corporate Corporate Other Other IS Vision IS Vision One Technology Platform One Technology Platform External External (High Availability) (High Availability) Users Users • Common Operating Model • Easier integration of new businesses • Support growth • Ability to support the current manufacturing models for Merillat and Quality brands • Common System Platform • One application platform • Key supporting applications • “High Availability” infrastructure

10. Project Organization Org Chart – Core Team The approach to the Business Transformation supports an end-to-end process vision, and alignment to key threads of activities Core team peak makeup: BCG Business 28 BCG IS 38 Deloitte Onshore 35 Deloitte Offshore 32 Total 133 Process owners are empowered and accountable to the steering committee Own the Design Own the Deployment Own the Results • Project thread leads provide the processes, approaches, tools and leading practices to confirm the key elements of a fully designed and implemented solution are in place • Collaboration • Work with all process leaders • Coordinate activities with other project thread leaders • Methods and Tools • Manage the EVD structure for tasks, deliverables • Accelerator tools • Subject Matter Expertise • Process best practices • Technology best practices • Manage Resources

11. ERP Team Membership Chart

12. 11 Executive Interviews 150 Personnel 10 Workshops • Key Strategies • Quick To Market • Eye Of The Customer • Common Platform • Vertical Integration • Operational Efficiencies Opportunity Validation Meetings • 100+ Opportunities • Scope By Process Area touching 100% of the business • “Top 18” Identified • Nine Key Process Areas • Functionality verification BUSINESS CASE • “Fact Finding” • Brainstorm Sessions • Additional Benefit areas not fully quantified • XXX Benefits Analysis Cost Validation Meetings Identify Detailed Costs Costs Analysis Define Detailed Cost Categories • Program Structure • Deployment Approach • Future Architecture • Cost Validation • Program Structure • Vendor Meetings for Hardware/ Software • Training Plans • Detailed Current IS Analysis • Capital Vs. Expense • Resources • Software/Hardware • Hosting vs. in-house • Training/Other Costs Building the Business Case A rigorous process was used to identify benefit opportunities and gain executive commitment Payback: 6 Years

13. Masco ERP Implementation Methodology /Approach Deliver Vision Plan Design Build CRP Pilot Rollout Operate BusinessCase Understand Client Strategy Analyze Enterprise Financial Performance Identify Key Client Business Issues Define Value Targets Value Identify Value Opportunities Develop Business Case Assess and Optimize Project Portfolio People, Change& Learning Develop Change Management Strategy and Plan Assess Leadership Alignment Develop Change Readiness Approach Assess Communications Management Identify Stakeholder Groups Processand Package Assess Customer Needs Assess Business Strategy Develop Process Vision BusinessIntelligence Define Key Performance Indicators Information Technology Assess Applications Assess Technical Infrastructure Assess Data Conversion Impact Securityand Controls Define Governance Concept Tax Develop Tax Approach Support Assess Application Management Service Deal Define Support Strategy Establish Client Commitment to Application Management Services Deal ProjectManagement Initiate Project Plan Project Execute Project Control Project Prepare for Deployment Source:

14. Critical Success Factors Your commitment Overcoming natural resistance to change Investing the right people into the project Business driven leadership with a clear definition of roles and responsibilities Excellent project management Empowered project team Commitment to complete Excellent communications

15. Critical Success Criteria – Key Questions • Can the executive finance team truly support the project? • At the minimum will the key leaders be consistent • Will we commit the right resources – full or part time? • Treat this as one of the most important things in the business – it is • Are we prepared to invest in strong project planning and management processes • More than a schedule – decision making and escalation, communication, risk management plans, master scope list and control process, staffing plan, time management process, quality control plan, and a schedule. • Change management deserves separate billing – down the road a bit. • Can we support and maintain what we are implementing?

16. PMO – Sample Process and Procedures

17. Questions