Reducing Costs & Improving Productivity through Enterprise Project & Portfolio Management Guy Barlow Director, Industry Strategy

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Agenda  Why EPPM?  Industry Overview & Challenges  EPPM Solution  Summary & Key Takeaways

WHY EPPM?

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72% OF CEOS IDENTIFY THE ABILITY TO MANAGE PROJECTS AS CRITICAL TO THE FUTURE GROWTH OF THE BUSINESS… …JUST 11% ARE VERY CONFIDENT OF THEIR ABILITY TO MANAGE BUSINESS CRITICAL PROJECTS Source: IPMA Study Sept. 2010

Source: Economist Intelligence Unit Survey 6% of executives say their projects come in on time and on budget consistently

Why?

1.Conflicting priorities 2.Lack of business alignment 3.No enterprise visibility 4.Redundant projects 5.No accountability 6.Slow reaction time 7.Squandered resources 8.Escalating costs

Clients Rely on Primavera for Mission-Critical Projects Financial Services Pharmaceutical/ Life Sciences Telecom Engineering & Construction Industrial Mfg./A&D Energy Public Sector/ Government

INDUSTRY OVERVIEW & CHALLENGES

Asset Intensive Industry Presence Proven Customer Successes

EPPM Drives Results Examples of Client Success – Financial  14% under budget on capital improvement expansion program  7% reduction in shutdown duration  Increased efficiency in procurement cycle by 80%  30% improvement in ability to schedule assets  Expected to achieve ROI in less than 1 year

EPPM Drives Results Examples of Client Success – Operational  Reduced exposure to volatile energy prices by managing risk  Centralized project data allows easy access/integration to other systems  Complete and total visibility across the enterprise  Handling hundreds of routine work orders daily at various sites  Contractors provide updates directly to the master schedule

Market Overview Industry Drivers & Impact Tighter Investment Environment; Greater Oversight Capital “Rust Never Sleeps”; Emerging Market Growth; Alternative Energy Infrastructure Loss of Grey Matter; Increase in Grey Hair Skills

Capital Asset Lifecycle Management Portfolio, Program & Project Level Challenges Operate & Maintain Capital Plan / Project Bid Phase Plan, Design & Procure Project Close Project Execution Business Management Change Control

Operate Optimize Maintenance Plan Improve Capital Investment Portfolios Build Enhance the Construction Process Oracle Primavera’s Focus 3 Core Areas

Oracle’s Primavera EPPM Solution Managing the Complete Project Lifecycle Standards-based Open Platform Oracle BI Analytics & Reporting Oracle Business Process Management (BPM) Contract Management Primavera P6 EPPM Application Integrations Risk Analysis Portfolio Management Earned Value

EPPM SOLUTION

Plan Improve Capital Investment Portfolios 1. Source: Economist Intelligence Unit – “Prepare for the unexpected: Investment planning in asset-intensive industries”, October 2010 Top 5 Challenges 1

Plan Complexity in the Capital Planning Process Long-Term Capital Planning How do we predict the costs of a long-term project? Capital Planners Strategic Planners Program Mgrs & Owners Will we have the resources to execute? Resource Mgrs. Procurement Operations/ Equipment Owners How do we evaluate projects & assets over the lifecycle of a project? Finance Executives Project Managers Risk Analysts

Plan Enterprise PPM Benefits & Best Practices 1.Plan, prioritize and select investments 2.Improve visibility across the whole project portfolio 3.Evaluate projects by using consistent metrics and analytical tools 4.Maximize return and minimize uncertainty by managing risks 5.Integrate ERP, EAM and other systems

Plan Proven Customer Successes Reduced Financial Exposure, Improved Regulatory Compliance  Better plan, track, and manage the scope of each project and program  Provided visibility in advance into upcoming resource shortfalls  Ensured projects were prioritized correctly, based on risk, to avoid significant financial exposure  Projects delivered faster and costs reduced  Helps meet service requirement deadlines

Build Enhance the Construction Process Top 5 Challenges of Construction 1 1. Efficiently managing and controlling documents 2. Measuring and reporting project metrics 3. Managing change orders and RFIs 4. Project risk management and mitigation strategies 5. Transitioning to a start-up environment 1. Source: “Mega-Project Management: Reducing Risk & Complexity Across the Value Chain”, Paper and Webcast, December Source: Primavera 2008 Project Management Report: Standardized Best Practices and Technology Adoption in the AEC Industry Reasons for Poor Project Performance 2

Build Stakeholder Management in Capital Construction Process Capital Construction How do we manage change orders & RFIs? Owner – Risk Mgr. Contractor – Project Controls Owner – Finance Dir. How do we increase EPC & owner integration? Contractor - Project Engineer Owner – VP Operations Owner – Project Controls. What’s the ideal way to measure & report progress? Owner – Project Manager Contractor -- Project Mgr. Owner – VP Finance

Build Enterprise PPM Benefits & Best Practices 1.Reduce risk by maintaining control across the entire project 2.Increase accountability and responsiveness with robust document management & controls 3.Shorten submittal approval times & reduce RFI turnaround times 4.Easily track and manage issues and other project set-backs 5.Lower costs by streamlining and expediting payments

Project Overruns Reduced by 85%  Reduced the number of overrun project schedules by 85% reduction  Allowed SFPUC to undertake 129 WSIP projects over five years, vs. four or five annually  Reduced report delivery times by more than 75%  Cut the time needed to process RFIs by 43% Build Proven Customer Successes

Operate Optimize Maintenance & Operations 1. Source: “Project management practices for asset maintenance: A Guide for Power, Energy & Process Industries “, Aberdeen, October 2010 Top 5 Challenges 1

Operate Coordination Impacts the Maintenance Process Managing both daily & complex maintenance How do I get an integrated master schedule? Planning Mgr. Contract Administr ator VP Engineerin g How do I increase craft efficiency & productivity? Operation s Dir. Project Scheduler Finance Mgr. Will I be able to capture best practices & lessons learned? Resource Mgr. VP Human Resources Plant Mgr.

Operate Enterprise PPM Benefits & Best Practices 1.Plan, schedule, and control all projects 2.Balance resource capacity and avoid over-allocation 3.Manage, plan and mitigate both change and risk to reduce costs and increase delivery times 4.Coordinate and collaborate across disparate teams 5.Monitor project performance and report progress to key stakeholders

Operate Proven Customer Successes Managing 2.2 million activities  Deployed new procedures for handling hundreds of daily routine work orders at various sites  Estimated cost savings of US$3.5 million  Supported 2.2 million activities  Web capabilities enable easy data entry and customizable dashboards

SUMMARY & KEY TAKEAWAYS

Source: Economist Intelligence Unit Survey 6% of executives say their projects come in on time and on budget consistently

Summary & Key Takeaways 1.Project Success Drives Financial Performance 2.Focused on Core Lifecycle Areas – Plan, Build, Operate 3.Complete Suite of Solutions – Portfolios, Projects, Risks and Contracts 4.Executive-level and project level – Visibility & Transparency 5.Global Client Footprint