APICS Board of Directors Meeting Update December 2016

Confidentiality Notice The materials and subject matter contained in this presentation are APICS Intellectual Property and are of a sensitive nature and as a result are privileged and confidential. Please do not post this presentation on public websites or share with the general public. Please contact APICS Chapter Relations at chaprel@apics.org if you have a question about a specific slide. ​

APICS Vision and Mission APICS Vision Statement APICS—the world’s leading community for end-to-end supply chain excellence. APICS Mission Fostering the advancement of end-to-end supply chain management through a body of knowledge, innovative research, systems and methods to create value for customers, members and organizations.

Topics Approved motions Finance report Strategic priorities update Products and services update

Approved Motions

Approved Motions The Board approved the following motions at the December meeting: Approved the 2017 – 2019 Budget as presented at the December board meeting. Approved the dissolution of the current APICS SCC Board of Directors and created the APICS Research, Innovation and Strategy Committee to provide staff with recommendations regarding research and strategic direction/initiatives for APICS.

Approved Motions, cont’d Approved the 2017 Leadership Team and 501c3 Board of Directors as follows: Steve Georgevitch, Chair Brad Householder Keith Connolly Antonio Galvao Shari Ruelas Approved the 2017 Committee Chairs as follows: Ben Crawford, Courseware Committee Joanne Gorski, Certification Committee Keith Johnson, District Manager Committee Matt Drake, Academic Committee Ray Ernenwein, Research, Innovation, and Strategy Committee

Approved Motions, cont’d Approved the 2017 Nominating Committee as follows: Bill Bickert, Chair Erica Benisch Antonio Galvao Mike Wasson Mark Holmes

Finance Report

YTD Oct-16 Results $000s Omitted YTD Oct-16 YTD Oct-16B Variance Favorable/ (Unfavorable) Change % Revenue 23,574 26,115 (2,541) (10%) Operating Expenses 24,799 27,850 3,051 11% Net Operating Loss (1,225) (1,735) 510 29% Unrealized Gain/(loss) 488 n/a Change in Net Assets (737) 998 58%

2017 to 2019 Budget Highlights

Strategic Priorities Update

Digital Strategy

Digital Strategy Research Agenda Creating a “Future-Ready” APICS Transformation Changing the way we do business 2016 - 2018 Innovation Changing the way business is done 2019 >> Digital Strategy The Rise Research Agenda

Membership Strategy

Membership Strategy Update The new membership model featuring Core and Plus memberships went “live” in July 2016. New Professional members are joining as follows: 12% selecting Core membership 88% selecting Plus membership Professional members are renewing at 55% Core; 45% Plus. Significant member benefits have shifted from print to digital, including the APICS magazine and APICS Dictionary. Print versions are available at an additional charge.

China Strategy

China Priorities – Executive Summary Position APICS for revenue growth (via indirect and direct channels), across the APICS portfolio, as appropriate. -Strategically expand channel partner base. -Further develop SCOR community to include large corporates, affiliates, sponsors, ambassadors and channel partners. Continue down path to localize CPIM in Simplified Chinese to underscore long term growth and market share. -Do the right deal, with the right partner, with a viable business model, that protects APICS intellectual property. Manage the Financials -Ensure the China strategy continues to focus on building the corporate and individual markets, while being accretive to APICS.

APICS China Strategy – Vision for Business in China Current State (2016) Transition State (2017 & 2018) Future State (2019+) Market demand driven by NA/EU corporates. Channel partner revenue is under pressure: Economic issues. Training budget cuts. Over-reliance on NA/EU corporates. APICS’s traction/revenue with large China-based corporations is emerging. SCOR community was underserved until 2016 relaunch. APICS partners with a 3rd party to develop/ deliver CPIM in Simplified Chinese. Expand channel partner base with multi-national SC consultancies and partners for localized CPIM offering. Develop strategic corporate relationships to build APICS brand and revenue within China. Strategically develop SCOR community in China to drive growth. Market demand driven by China-based and NA/EU large corporations. Channel and corporate revenue is growing. APICS products and services have a material, expanding presence with China-based, large corporations. The SCOR community is the gold standard of organizational transfor- mation in China, generating significant, direct and channel revenue growth.

Products and Services Update

CLTD Update: Very Strong Start! Interest in the CLTD continues to be strong! Total sales met our annual revenue projections in the first three weeks of launch and are currently outperformed revenue projections for 2016. CLTD marketing materials are available on C-Box.

CPIM Partner Webinar: January 31, 2017 Plan to attend the partner update on the CPIM credential reconfiguration and partner pricing model. Topic: Detailed overview of the partner pricing model, overview of timing Provide input: Submit a question in advance Plan to attend: Offered at 9 am and 3 pm CST Presenters: Dean Martinez, Bob Collins, Lisa Sallstrom

CPIM Task Force Outcome Final CPIM Task Force Recommendation: The Task Force unanimously supported a change to the CPIM configuration. The Task Force voted in favor of a 2-module configuration. The APICS Board of Directors approved this recommendation on July 30, 2016.

Reconfiguration of Exam Objectives The BSCM exam would remain as a standalone exam expanded to 150 questions and 3 ½ hours to introduce new technology-enhanced item types. The second exam would cover the content contained in MPR, DSP, ECO and SMR (weighing 25% each) through a sampling process that we currently use for existing exams and be expanded to 150 questions and 3 ½ hours. The new exam configuration will remain psychometrically validated and legally defensible. The CPIM body of knowledge would not change nor would the knowledge, skills and abilities the candidate is expected to master. Purpose of TEIs is to test at higher-level cognitive abilities BOK changes after completion of a JTA

Benefits of Proposed Courseware Configuration Learning System Enhanced online experience for students: pre-exam, quizzes, activities, videos/presentations on difficult topics, multiple post exams. Exam Simulators to be rolled into the online Learning System. Flipped Classroom Capabilities Instructors and corporations can use online activities/presentations/quizzes as assignments or as part of a “flipped classroom” approach (learn online, practice in class). Social Learning Additional tools for more social participation in online Learning System, such as Announcements, “Ask the Instructor,” Group Discussion area, all within the Learning System that the students and instructors see. Instructor Guide and PowerPoints for classroom Face-to-face, blended, live on-line.

CPIM Learning System Components Participant Materials The CPIM body of knowledge will follow the two-part configuration identified in ECM v6.0. The reading materials will be available in print and e-reader formats. Online Materials and Resources The online component will provide tests, exercises, and additional resources for both learning and teaching. Premium features will support a blended learning experience. Instructor Materials Instructor materials will include instructor Resource Books with facilitator notes, PowerPoint slides, classroom exercises, student slide books and an optional final exam.

CPIM Learning System Delivery Formats The CPIM Learning System will support two different delivery modes, based on audience needs: (1) Self-Study and (2) Instructor-led. Online features that are available will vary to accommodate the delivery format. Feature: (by Part) Self-Study Version Instructor-led Announcements  Class Roster “Ask the Instructor” Threaded Discussions Pretest Embedded e-Reader Section Quizzes Posttest Practice Exam Instructional Videos Interactive Case Studies Glossary/Flashcards Resource Center The following partners would be offered this version, to support blended learning opportunities: College/University Chapters International Corporate Corporate partners could be sold either version, based on need.

Proposed Business Model Focus Customer focused Product flexibility Self-Study Flip Class Room Instructor lead Electronic delivery capability Global pricing Align pricing and model with other similar product offering by both competitors and APICS Overall reduction in customer cost and time commitment Condensed learning path Learning system

Draft CPIM Reconfiguration Timeline 8/1 Exam development changes begin 10/2016 Begin Development of new Courseware 11/16 – 1/17 Detailed partner / Corporate socialization with developmental feedback 12/16 Announce pricing model and launch date for new configuration 03/2017 Updated CPIM ECM tentatively available Q3 2017 Courseware and new exam available for purchase* Note: the old 5-exam configuration will be available through a period of time to allow for candidate transition. * Subject to date change

Ensuring Successful Transition Modules 2-5 as well as the new combined exam will be offered simultaneously during an extended interval providing individuals time to transition. The 10-year exam expiration policy for legacy BSCM exams will continue to be honored. Candidates will be assured to either begin or continue their CPIM pursuits For those who have passed a few exams, there will be less financial investment required to complete the legacy CPIM configuration. For those who have passed a few exams, waiting for the new combined exam will require a review of material that they were already tested on. Communication will be timed and distributed in a manner to avoid a potential “run on the market.”

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