The Relationship Lifeblood: Leverage the Relationship Improve Intimacy Create Value Reduce cost

1. Turn on your sound to hear the presentation Innovate Partnering for Innovation • The Relationship Lifeblood: • Leverage the Relationship • Improve Intimacy • Create Value • Reduce cost Click Here for Next Slide All concepts and ideas contained within this document are the intellectual property of Custell Pty Ltd. Content must not be copied or used without written approval from Custell.

2. Relationship Characteristics (Reference – Tony Lendrum – The Strategic Partnering Handbook • Degree of: • complexity • competitive advantage • customer satisfaction • innovation Efficiency Objectives "Make It Cheaper" Effectiveness Objectives "Solve my problems” Competitive Advantage "Make Me Money" Business Value • Vendor • Trader • Price is No.1 requirement • Little differentiation • Low Margins • Little Loyalty • Key Supplier • Quality, on time, to specification, solution delivery • Differentiation • Reducing Costs • Adding value • Innovation • Providing expertise • Partner • Shared • Trust • Strategy and information • Vision and Goals • Risks and Benefits • Discover, create, provide world-class products and services Click Here for Next Slide

3. “Innovation is the Lifeblood for sustaining business relationships” Tony Lendrum Innovation is about people and enterprises, not about science and technology – its all about attitudes. Australian Business Council Partnering for Innovation Click Here for Next Slide

4. With Partnering & Innovation RETENTION LIKELY RETENTION UNLIKELY Customer Decision Point Renewal or Tender? Relationship Life-Cycle Typical Relationship Cycle over a 5 year services contract (Key assumption – Supplier is consistently meeting SLM’s) Custell Research 2004 - 2008 Without Partnering & Innovation Click Here for Next Slide

5. Innovation or Invention Innovation or Invention • Innovation • Process of change that adds value. An enhancement modification, add on or alternative application of an existing product/service or process in such a way as to increase its value to the user • ‘Incremental’ ‘Discontinuous’ ‘Disruptive’ ‘Architectural’ • Invention (Breakthrough innovation) • Product, service or process without precedent • “Breakthrough” “Radical” Click Here for Next Slide

6. Challenges to Innovation In Relationships 1. Assess Innovativeness 1. Assess Innovativeness 2. Plan Change 2. Plan Change 5. Measure & Manage 5. Measure & Manage INNOVATION CHANGE MODEL 3. Map the Journey 3. Map the Journey 4. Systemise Innovation 4. Systemise Innovation Innovation Change Program • Audit and assess Innovativeness • Plan and Implement Change - Break down the barriers to Innovation • Map the journey – Empower the teams • Systemise Innovation – Collaborate and manage progression • Measure, Manage and reward • Assess Program – Drive continuous improvement Click Here for Next Slide

7. Innovation Model Break Down the Barriers CREATING THE CLIMATE SUPPLIER & SUPPLIER & CUSTOMER CUSTOMER Facilitate Innovative Ideas SEARCHING IDEAS IDEAS   EXPLORING Impact/Scope Tracking   COMMITTING Business Case   REALISING $ Innovation Model Innovate Model Reference - Barnes & Conti Innovation Journey Map Opportunity Funnel Click Here for Next Slide OPTIMISING $

8. Innovation Model CREATING THE CLIMATE SUPPLIER CUSTOMER SEARCHING CREATING THE CLIMATE SUPPLIER PREPARATION & TRAINING CUSTOMER SEARCHING (Facilitation, Identifying, Hunting, Gathering) IDEAS INNOVATION WORKSHOP PROGRAM INNOVATION BUSINESS INTEGRATION IDEAS   Manage an Innovation Manage the Pipeline EXPLORING EXPLORING (Evaluate, Qualify, Quantify, Prioritise) Filter Tracking Tracking   COMMITTING (Business Case) Commit? COMMITTING   Innovation Pipeline Management Innovation Journey Map Innovation Model Innovate Model Reference - Barnes & Conti Innovation Journey Map REALISING REALISING Click Here for Next Slide OPTIMISING OPTIMISING $ $ 8

9. Innovation Program - Summary Registers – tracking progress • Two Registers: • Opportunities • Identifies opportunities for innovative solutions • Provides focus for innovative activity • Visual to all parties • Sets ‘Value’ objectives • Innovations • List of innovations in the funnel by Opportunity • Description, status, value, team members • Basis for tracking progress • Used for pipeline management • Benefits: • Provides focus for innovation • Simplifies tracking • Single source ofsummaryinformation Click Here for Next Slide

10. Innovation Program - Summary Collaborative Workbenches • Team Workbenches – 3 levels: • Overall Program • Each Opportunity • EachInnovation • Workbenches Provide: • Maintenance of Registers • Single source of information across diverse organisations • Secure Team Collaboration • Journey map Guidance • Visual workflow • Templates • Content Management • Document Management • Discussion Threads • Benefits: • Effective cross functional teaming • Easy management Click Here for Next Slide

11. Team Collaboration Solution Creation Tools & Techniques Assessment Tool Prioritisation Methods Pipeline Management Measurement – progress & value Tools Deployed Tools Deployed Click Here for Next Slide

12. Innovation Program - Summary Innovate for Outcomes System based teaming tool for facilitators Focuses the team on a specific Opportunity or challenge Creatively generates ideas that achieve required outcomes Uses fishbone method incorporates a team voting tool to prioritise ideas “Innovate” Searching Tools • Root cause solution • System based teaming tool for facilitators • Focuses the team on analysing and solving the root cause of a problem • Creatively generates ideas that will correct the root cause • Uses fishbone method • incorporates a team voting tool to prioritise solutions Click Here for Next Slide

13. Innovation Program - Summary “Innovate” for Teams(Custell - half day course) Understand what makes an effective innovation program Assess and rank an innovative idea relative to its value and scope Manage an idea through a process Participate in ‘enterprise to enterprise’ teaming tactics to create value “Innovate” Team Leader Accreditation (Custell - One Day course) Articulate the characteristics of an effective innovation program Use Innovate tools to facilitate team meetings to ‘search’ Use facilitation tools from Innovate to ‘explore’ and ‘commit’ Manage the Realising and Optimising phases Manage the innovation pipeline Managing Innovation(Barnes & Conti - 1 day course) Clarify how innovation can become an important part of the way that you do your job and live your life. Develop the mind-sets and skill sets that are appropriate to each phase of the innovation journey. Suggest practical ways in which you can apply skills and insights to your area of influence. “Innovate” Training Click Here for Next Slide

14. Innovation Program - Summary An end to end Innovation Solution INNOVATION CLIMATE:A change program to improve your innovativeness by breaking down the barriers to innovation, TEAM TRAINING:Training programs to improve your peoples skills in creativity, leadership and innovation management, SYSTEM:A team based collaboration and innovation management system to support your innovation teams.  PROCESS:Deploy a process (or journey map of your choice) to provide an easy and consistent way for teams to progress innovative ideas. METHODS:Tools and techniques to generate and test new, creative ideas. Innovation Program - Summary Click Here for Next Slide

15. Drive measurable value for the customer Create revenue opportunities for the supplier Build Competitive Advantage Build trust in the relationship Increase Intimacy & Loyalty Productivity - Maximise return from scarce resources Easy to manage www.custell.com Benefits Innovation Program Benefits Click Here for Next Slide

16. Leveraging Relationships Custell