e-Business ShipServ Conference 18 th June 2004

1. e-Business ShipServ Conference 18th June 2004

2. Marine Coatings Contents • Why e-Business Solutions? • Customer • International Paint • Why a Portal • Why ShipServ • Lessons Learnt • Solutions Adopted

3. e-Business Project – Why Invest in e-Business Solution? Our “Beyond Paint” philosophy of added value services throughout the supply chain e-Business Solutions

4. e-Business Project – Why Invest in e-Business Solution? Our “Beyond Paint” philosophy of added value services throughout the supply chain e-Business Solutions • EDI • Portals • Web

5. e-Business Project – Why Invest in e-Business Solution? Benefits – to the Customer • Increase in contract compliance • Typically this is the largest element of the e-Procurement value proposition • Increased leverage of purchasing power • consolidated details of actual spend with each supplier • consolidated detail of actual spend in each product category • Reduction in process costs • reduced error rates • reduced processing time • reduced fax / phone usage • reduced on-site inventory …..enabling dedicated Procurement staff to focus on value-adding activities

6. e-Business Project – Why Invest in e-Business Solutions? Benefits – to International • 50-75% of customers with frame agreements continue to send “requests for quotation” (read price confirmation) for local order • 80-90% of these become orders • 10% Account Exec time taken with order enquiries • Multiple re-typing of same data on overseas orders • Much chasing and manual checking of data in quotation/order process.

7. e-Business Project – Why Invest in e-Business Solutions? Benefits – to International • Joint exercise with ShipServ identified savings in 4 processes; • Improve Quoting Process (Local and Overseas Orders) • Improve and automate order/order confirmation process (local orders) • Improve and automate order/order confirmation process (overseas orders) • Place Ship-specific product list in ships purchasing environment

8. e-Business Project – Why a Portal? Why a Portal? • Market consolidated to private hubs + handful of majors • Some companies (ShipServ) showed consistent growth in transactions • At least 10 key customers integrated to the main portals • Some major suppliers integrated into one of the main portals • Industry takes time to learn……….is it better to learn now or later ? Electronic automation will play a major part in future buy/sell processes

9. e-Business Project – Why select ShipServ as SP? Why ShipServ? • Track Record – a survivor • Professionalism • in the feasibility exercise • Management • Knowledge of Marine Business • Technical capabilities, flexibility and adaptability in set-up • Established Customer Base and potential new business

10. e-Business - What have we learnt? • e-Business is not just a nice website……. • A well designed simple system can leverage underlying competences • Why is it so difficult to extract value from e business projects? • Usually small scale, thus small increments = minimal effect • IT driven not business driven ! • IT / Business “gap” • Not enough focus due to “speed of learning” and “unproven concepts” etc • Underestimate levels of resourcing • E Procurement • Neither buyers nor Suppliers currently see real benefit for significant immediate expenditure. But must keep 'foot in the water'

11. e-Business - What have we learnt? • Implementation and Business issues greater than systems issues….it takes time and money to learn • Our systems infrastructure is well advanced and provides a basis to support global service (information) solutions with relative ease • Internet for information retrieval in business is ubiquitous (or matter of time) • E procurement (in whatever form it takes) is a matter of time (P@CCESS!) • MarineR and MFGPRO implementations can be taken further (automation/BPR) • Increasing information demand from customers • Differentiation by service/customer retention vital to success INTERNET PRESENCE Marketing, branding, visibility, generic information and service provision, support product launches EXTRANET window on service relationship E SELLING/PROCUREMENT Supporting our customers Catalyst for further internal BPR

12. e-Business – Solutions adopted

13. Cust A e-Business – Solutions adopted XML (CIDX pref) Cust C Cust B MTML XML Other MarinePortal Cust D EDI P@CCESS HUB ShipServPortal Cust E MTML XML Cust F CIDX XML YachtPortal Cust G CIDX XML M&PC E-Commerce HUB 2 methods of electronically placing orders: - Direct B2B (XML, EDI) - Indirect B2B (via Portal) F/F Marine Order Yacht, PC or Local Marine Order F/F Marine MOF Mfg/Pro (Marine O/A) Mfg/Pro Marine S/A

14. e-Business – Solutions adopted End to end connectivity • Customer’s own IT system – outputs PO data for direct B2B • Portal – presents IP Product Catalogue to allow customer selection of IP Code; translates message into one common format for transmission to IP • Transport – data format (e.g. XML file) and method of transport (Internet transmission – http post) • Akzo Nobel Hub (P@ccess) – firewall security and translation of incoming message into common format (CIDX XML) • BU Hub – message translation into coatings terminology, application of business logic to route message to correct destination • Mfg/Pro system – PO uploaded directly onto correct system with clean data. Order Process personnel alerted to the order arrival

15. e-Business – Solutions adopted Roll-out of the Project • Phase 1 will allow a PO to be uploaded directly into our main business system (Mfg/Pro) - imminent • Future phases (Q3,4 2004) envisage adding the following automated transactions between IP and customers via ShipServ: • PO acknowledgement • Request for quotation (and quote response) • ASN (notification of goods shipment) • Invoice

16. e-Business – Reactions/Feedback so far • Early Days - Live programme not yet active trading– need live data to prove the system and confirm next phases practicability • We continue along a cautious path to provide a comprehensive infrastructure to enable any form of Business-to-Business transactions our Trading Partners wish to employ • Prediction that electronic trading/messaging will increase is borne out in recent experience in Marine and other Markets

17. e-Business – potential ‘Obstacles’ Data Integrity • Need accurate product data – use of IP Product Catalogue in purchase order / RFQ entry would be appreciated: • To minimise keying errors • To facilitate “translation” • Flexible enough to provide all potentially required products • Rigid enough to avoid order of incorrect products • Small enough to be easily downloadable to vessels offshore • Ensuring key data items are supplied: • Vessel IMO number • Delivery Port location • Delivery date • Delivery address details • Agents details • Any critical instructions

18. e-Business Project – “Beyond Paint” • Connected to our “Beyond Paint” philosophy of added value services throughout the supply chain: • Purchasing • Technical inspection and reporting • Coating report and on board maintenance programmes • Customer sales stats and management reports • Product data sheets and H&S information • Contact information • Technical information, cargo resistance guides and track records

19. e-Business Project THANK YOU