WW DIRECT CUSTOMER ADVISORY COUNCIL: Global Business Model Update

1. WW DIRECT CUSTOMER ADVISORY COUNCIL:Global Business Model Update Gilles Leyrat, Director, Operations, Volume Direct Operations April 26th 2006

2. Global Business Model Update • What’s new • Global Process convergence : Back office vs. Front Office • Operations Metrics as the driving force of the program • Recent updates • Tests • Pilots and deployment projections • What I want to accomplish today with you • Explain what we are doing to operate better in a global environment • Obtain your feedback on priorities and next deployment steps

3. DEFINITIONWhat is the Global Business Model? • A Series of pragmatic, step by step developments to drastically improve our global business offering operations • Mix of process alignment supported by key critical applications enhancements • Centered on Offer Selection, Deal Management, Communication, and Catalog Management

4. HP Volume Direct Global Business Current Challenges

5. Lead and Outbound Region (US based Deal example) Inbound Region : EMEA Deal Information Catalog data (EMEA Orderable product, EMEA price, adjusted with exchange rates and TBA) Lead Region = US Deal Information Catalog data (US product, US price) Inbound region = AP & J N Deal Information Catalog data ( APJ Orderable product, APJ price, adjusted with exchange rates and TBA) W E

6. Global product offering progression: NA Regions has a different supply chain from EMEA and APJ • ESG • Some Customer Specific SKUs • HPS • Few Care Packs • PSG • BTO outside of Global Series • IPG • SKUs outside Globals Series • ESG • Customer Specific SKUs • HPS • Few Care Packs • PSG • CTO • BTO outside of Global Series • IPG • SKUs outside Globals Series • ESG • BTO and CTO • Customer Specific SKUs • HPS • Most Care Packs • PSG • CTO • BTO outside of Global Series • Customer specific SKUs (PCCS) • IPG • SKUs outside Globals Series Non Common Global Offering Complete Global Offering = Common Global Offering end 07 end 05 end 06 Non – Common: Product numbers differ by country, product set up not automatic across all countries, supply chain differences, products not priced on all price descriptors, … Common: Same Product Number can be ordered in all countries, or there is a systemic translation that does not require human intervention to check orderability, pricing, etc.

7. Global Business ModelRequiring complex deal management processes Global Business requires the merge of multiple deals to provide a consistent view for catalog creation and maintenance

8. Consistent and Simplified Global Processes

9. High Level Process Definition : Front Office / Back Office - Soon to be piloted Outbound Region I Administer Portal Legend Front Office Create /Update Region/Local Deals Approve Region/Local Deals Publish Catalogs Structure Bundles Back Office Merge Deals into Catalogs Customer initiated change Select Offer O I Approve OB Global Deal Create / Update OB Global Deal* * APJ, Americas. For EMEA outbound deal creation and maintenance will remain in the Front Office PLC / Orderability checking Propose Product Substitutions Approve Product Substitutions I GpComm IB Global Deal analysis PLC / Orderability checking Propose Product Substitutions Approve Product Substitutions Create/Update Inbound Global Deal Approve Inbound Global Deal I Structure Bundles Publish Catalogs Merge Deals into Catalogs O Select Offer Customer initiated change Create/Update Region/Local Deals Approve Region/Local Deals I Administer Portal Inbound Region I

10. Consistent Front Office / Back Office Business Processes across all regions Front Office Back Office APJ, Americas Candidates used for pilot

11. APJ DNA Enhancements Consistent Infrastructure • Scale the direct engine across the regions • Standardize key processes and tools • Deploy baseline in all regions • Simplify the architecture WW Baseline Architecture Regional Solutions Americas 2005-2007 NA Direct Program APJ 2005-2007 EMEA EMEA

12. Consistent Metrics • We are putting in place a metrics baseline so that we can judge the effectiveness of the planned changes. • Metrics are reported on a monthly basis. • This baseline is being collected for 5 ‘typical’ Global Accounts selected by the Global Sales Leads across the regions. These accounts are: AP Möller, John Deere, Smiths PLC, Motorola and ABN Amro. • The data we are collecting are:

13. Key Takeaways • What it will mean for our customers:shorter TAT on offer updates,better quality catalogs – especially in inbound regions, better Sales and Ops support to match the HP offer to their needs (e.g. to spend time on CTO set up, to better structure catalogs, …) • Well defined Approach (PDSA): Define current state, propose solutions, test, pilot, refine, deploy widely • Focused on Process Improvement, changes in Roles & Responsibilities, streamlining processes - to reduce Costs, improve TAT, improve Data Integrity. • Infrastructure changes are secondary – they will make the transition happen more quickly. • Part of a bigger picture to focus regional ops staff (ISRs, Catalog Mgrs) on our customers. • Good progress made : Test in Pro (Petrox is started), pilots in May – Sept/Oct, asset roadblocks (e.g. EMEA indirect) are getting resolved.

14. Q&A • Resources: • Email : gilles.leyrat@hp.com • Phone : +1 408 447 4560