Andrew Houghton Vice President & Business Process Manager IDC, 29 th June 2005

1. Delivering BI at ProLogis,a leading provider of distribution facilities and services:A case study Andrew Houghton Vice President & Business Process Manager IDC, 29th June 2005

2. Agenda • About ProLogis • Origins of the Project • Setting the Scope • Initial Screening • Final Product Selection • Developing an Internal Investment Proposal • Selling the Concept Internally • Obstacles Encountered and Solutions • Summary and Conclusions

3. About ProLogis • Worlds largest developer and manager of industrial real estate • 1,970 facilities throughout North America, Europe, Japan and China. • Headquartered in Denver, Colorado • Founded 1991 • Went public in 1994 (NYSE, PLD). • S&P 500 since July 2003 • International operations in Europe 1997; Japan 2001; China 2003. • 5 million m² of distribution space in Europe • 22 million m² distribution space in the US and Asia.

4. Origins of the Project • Large investment in ERP, but business information inaccessible and hard to analyze • Labour intensive reporting model • Existing reporting processes not scalable • Growing appreciation of the need for more timely and ‘decision-centric’ information • No single version of the truth • Different versions of same data point stored in multiple systems • Increased business complexity • Major acquisitions, new markets, new finance sources • Greater pressure on management: SarbOx etc.

5. Setting the Scope • Two types of Scope • Tool selection – scope fixed relatively early on • Delivered content – iterative • Providing a toolset rather than a fixed suite of reports • Management need to see something to understand the system’s potential • Requirements Gathering • Interviews with information consumers: end users and analysts • Vision Statement • Decision driven by both technical and functional criteria

6. The Vision • Supports strategic plan for scalable growth • Key Deliverables • Executive dashboard • Analytical and reporting toolset • Self-service • Dynamic/interactive reporting • Common data, personalised views • Blends data from disparate sources

7. Initial Screening • Initially cast a wide net • Both technically and functionally • Visited 2004 IDC BI conference • Supplied vendors with Vision Statement and sample data • Product Demonstrations from ‘long-list’ • ProLogis data – not standard demo data • High end-user participation • Indicative Pricing • Short-list of 2

8. Final Product Selection • Intensive 2-3 day workshop with each short-listed vendor • Very ‘hands-on’ involving analysts working with prototype data warehouse • Effectively represented a ‘Proof of Concept’ • Informal debrief and formal evaluation by attendees • Formal RFP to vendors • Final decision based on RFP responses and.. • Workshop feedback / technical opinion from IT / price • ProClarity selected

9. Developing an Internal Investment Proposal • ProLogis requires formal investment proposal be signed off • Business justification; brief description; budget summary; project plan/timeline • Canvass and secure senior management buy-in • Provides unequivocal proof of management support

10. Selling the Concept Internally • Engage people at every level • Senior managers; middle managers; analysts; IT people • Intensive internal sale • No prior BI investment, therefore steep ‘learning curve’ for many managers • A lot of internal presentations • Workshop output illustrated concepts and provided ‘shop window’ for deliverables • Lots of Q&A • Ongoing throughout the process

11. Obstacles Encountered and Solutions • Dealing with Divergent Expectations: BI means different things to different people • Identify, agree and prioritise deliverables early on... • ...But! Construct a flexible platform with future options in mind • Vision Statement and internal selling to reinforce scope • ‘Territoriality’ within the IT department • BI project configured around a Data warehouse challenged our platform/applications-based IT organization • Cross disciplinary project: business led, but with strong IT input • Positioning BI as supplementing rather than replacing existing systems • Senior management sponsorship effective here

12. Obstacles Encountered and Solutions • Resistance from ‘reporting traditionalists’ • Support for system stronger amongst general managers than accounting/reporting specialists • Discomfort with the ‘warts and all’ approach implicit in strategy • Gradual transition rather than overnight change: the ‘Market place of ideas’ • Data Quality • Transparency of BI system highlights errors and inconsistencies in data • Credibility of the system demands that BI accurately reflects underlying data sources • ...but, need to distinguish BI issues from business process issues

13. Benefits so far • Still in process of implementing core BI functionality • BI lends clarity to data quality issues • BI has brought data warehousing with it with spin-off benefits beyond BI • High level of expectation and anticipation among management • Main management reporting book currently available 3-4 weeks after month end • BI will reduce this to days/hours

14. Summary and Conclusions • BI can be a transformative technology, and thereby can implicitly challenge certain interest groups within the organization • Explicit Executive Sponsorship is vital • Continuous internal selling/communication • Project leadership needs to come from the business, not IT • Formulate a ‘vision’ for the project early on • Establishes achievable goals, restrains ‘scope creep’ • Clarifies priorities with management • ...but, also build a platform and tool set for the future • Technologically agile • Adaptable to evolving reporting paradigms • Adaptable to changes in the business model