Topic Outline Background Competitive Environment Sourcing Propensity – Self Test Retained versus Sourced Processes Discussion CONFIDENTIAL

Background TPI assists buyers with the evaluation, negotiation and management of sourcing transactions Since 1989, TPI has assisted with more than $300B TCV of sourcing transactions, ranging in size from $10M to $4B per year Outsourcing is a tool and not an objective When selected outsourcing is a “least worst alternative” CONFIDENTIAL

Competitive Environment Competing in a global economy is getting increasingly tough Key competitive advantages are “time to market” and cost Companies are focusing on: Core competencies that provide competitive advantage Improved “Time to market” Low cost variable cost structures Optimum use of capital Transforming their cultures to better compete Internal versus external sourcing decisions are being fundamentally affected by the view that during the next five years “off-shore” and “near shore” resources must be used to remain cost competitive. CONFIDENTIAL

Sourcing Propensity – Self Test – Three to five year view Outsourcing decisions are dependent upon the Company’s anticipated ability to utilize the following nine levers more effectively than the Supplier. Anticipated Company Capability ? Supplier Capability Yes Multiple Good Off shore Available Good; Enforced Robust Key Levers Culture – professional, business oriented, metrics driven Self-Service – minimizes support of administrative functions Shared Service Centers – provides economies of scale Centers of Excellence – spreads costs, experts and tools Location – use of high cost versus low cost locations Labor/Talent – use of off shore and other lower cost alternatives Capital – availability of capital for cost cutting tools Policies & Practices – ability to implement standard practices IT Infrastructure & Systems – ability to implement new technologies Most companies will decide to source major portions of non-core processes CONFIDENTIAL

Retained Versus Sourced Processes – How Much is Really Outsourced Varies for Individual Customers Process Examples Accounts Payable Purchasing Operations IT HR Etc. Process Layers Governance Strategy Governance Policy Decisions Process Design Design Development Reengineering Innovation Administration Operations Administration Execution Context Systems Systems Technology Transactions Infrastructure Note: Underlined - Italics are shared processes Legend: = Client = Supplier Source: G2 Research; TPI CONFIDENTIAL

Discussion CONFIDENTIAL