Overview of Continuous productivity tool

1. Overview of Continuous productivity tool

2. Objective • To capture the overall objective of an organization defined at CXO level • Capture the top down objectives & KPIs at Strategic, Tactical, Operational layers • Driving the overall productivity & profitability by cost reduction  Improve the performance • Why and When to use the tool? • Implementation of many actions with high complexity • Actions can be standarised • A lasting Financial impact against a defined base year / reference can be quantified (in terms of cost savings) for the action • Action implementation progress requires transparency in qualitative and quantitative terms Objective & usage Ceaselez Consulting LLP

3. Key elements of Measure of Implementation (MI) logic Measure of Implementation (Example: Cost Reduction) MI 1 MI 2 MI 3 MI 4 MI 5 • Each action is monitored via its Measure of Implementation (MI) • For each action, its MI status is to be reached at specific due dates • The implementation status is monitored by the MI ramp-up • The MI logic establishes a link between quantitative & qualitative controlling by assigning to each action cost reduction potential Key elements of CPI MI ramp-up (Schematic) Ceaselez Consulting LLP

4. MI 2 MI 3 MI 4 MI 5 MI 1 • Definition of the cost/productivity targets • Specific idea described in Action sheet • Potential quantified • Due date fixed for MI 3 • Action sheet created with all its contents • Implementation prerequisites • Action plan with due dates • Detailed evaluation of cost savings potential • Signatures of responsible stake parties • Due dates fixed for MI 4 & 5 • Implementation prerequisites met • Action plan executed in full • Level & starting point of profit impact revised • Action is implemented with impact on profit • The portion with effective EBIT impact is shown in MI 5, whereas the portion not yet EBIT-effective remains in MI 4 Definition – Monitoring cost reduction & productivity improvement Ceaselez Consulting LLP

5. Tool based implementation control Our Continuous productivity Improvement tool integrates input with output Ceaselez Consulting LLP

6. Driving force behind preparation of action and achievement of preconditions for its implementation • Responsible as a member of the action or core team for: • Content, feasibility, evaluation and coordination of actions • Specifying the necessary implementation prerequisites and incorporating the action into the implementation controlling system • Communicating current status to controlling for updating Mis • Responsible for action implementation’s impact on profit • Pushes forward the substantive implementation of the action (from MI 3 onward) • Responsible to management for success of the action • Responsible for inclusion of actions in budget planning Roles of stake holders • Checks actions for formal accuracy and overlapping • Substantive controlling: Observes implementation schedule • Assign MIs • Financial controlling: Checks impact on profit • Drafts status reports Ceaselez Consulting LLP

7. INR Million Head winds CPI productivity EBITA analysis - Example Ceaselez Consulting LLP