Presented by Chris Bogan President & Chief Executive Officer E-Business 2000: Harnessing the Internet for Growth & Productivity Presented by Chris Bogan President & Chief Executive Officer

Internet Economy Explosion The Internet Economy grew at 62% last year to hit $523.9 billion. At this growth rate, economists project Year 2000 sales at $850 billion. What are the implications of this growth for each of our companies? THE INTERNET ECONOMY 1 in 6 people use the Internet in North America and Europe. 56% of U.S. companies sell products online. 82% of college grads search for employment information online. Internet-related growth was 15 times more than U.S. economic growth $850 900 100 200 300 400 500 600 700 800 $523.9 Internet Revenue (in billions) $322.5 1998 1999 2000 Data Source: Center for Research in Electronic Commerce, Graduate School of Texas at Austin. © 2000

Increasing Productivity Productivity continues to rise as companies leverage the Internet to increase operational efficiencies and worker productivity. Internet revenue per employee jumped 19% from 1998 to 1999. 68% of Internet Economy companies report experiencing a gain in market share attributable to the Internet - in contrast to only 24% of companies from the economy as a whole. Small businesses who use the Internet report 46% faster growth than those that do not. Revenue Cost Productivity = Data Source: Center for Research in Electronic Commerce, Graduate School of Texas at Austin. © 2000

Productivity Ecosystem Internet-enabled productivity gains are being driven by performance improvements across a broad-spectrum of operational fronts. Beyond the early internet “hype,” the real gains are being achieved by companies improving business systems. Which of these fronts offer the greatest opportunity to your company and your business model? Sales Supply Chain Back Office Support Marketing Information Technology Human Resources Service Internet- driven Productivity

Productivity Case Study: Cisco Cisco Systems has effectively integrated the Internet into its business model. The results are impressive cost savings, process efficiency gains, error reductions, productivity improvements, and customer satisfaction gains. 55% revenue increase from FY 1999 to 2000. Train 3,000 people worldwide online for $250,000, -- a 60% expense reduction. Technical Assistance Center (TAC) website allows real-time customer service response. One-interaction resolution of approximately 80% of Cisco’s support questions. $270 million savings on customer care. 25% increase in customer satisfaction. World’s largest e-commerce site: 90% orders online. 99% order accuracy and $60 million savings. Reduced time to close it’s books, from 14 days to real-time updates. Virtual supply chain reduced inventory levels by 45%. 12 weeks cut from products’ time to market. Online training will reach 100% of Cisco’s sales and technical staff by year 2000’s end. Data Source: Cisco Systems, Inc. Annual Report. © 2000

Case Study: Best Practices, LLC The Internet Economy offers opportunities to companies of all sizes. Best Practices, LLC has employed Internet technology to sell “virtually” on five continents – and to achieve important productivity gains. BP,LLC INTERNET SALES SNAPSHOT U.K. Germany Sweden Spain Productivity Effects: Virtual Offices E-commerce: worldwide sales. E-Marketing: highly effective mining, segmentation, and rapid-fire contact. E-Inventory: product stored in virtual space. E-Fulfillment: rapid and effortless. E-Service: on-line data capture. Jakarta North America Japan Russia Hong Kong Mexico Australia Venezuela Argentina Brazil Panama South Africa Philippines Singapore

Global Management Challenge Economic Evolution seems to be changing the structure of business relations. The old paradigm was vertical; the new paradigm is ecological. Which paradigm is most relevant for you? New Economy: Ecosystem Old Economy: Vertical Line Supplier Company Customer INTERNET INDICATORS Leadership Actively Involved. E-Business culture. Benchmarks best-in-class companies to seek improvement opportunities. Governance Resource allocation. Measured and evaluated. E-Risk. Organization “Ruthless execution”: agile and deft. Constantly enhance. Strategic Partnerships. Technology Commitment to web-based future. Internet solutions - highly functional, scalable. Ubiquitous access. New Economy success depends on speed, low costs, and expertise. Leadership – Actively involved = understands Internet + forward-looking Governance – (Metrics)Measure qualitative factors, e.g. customer satisfaction - E-risk = new applications are web-based vs. mainframe, back Internet initiatives with resource allocation high relative to IT spending. Organization – “Ruthless execution” – to E-Business solutions, e.g. 3 month projects, 3 – 6 people. - strategic partnerships outside your industry (agility). Technology - Senior management show dedication to web future and provides technological infrastructure and it is followed corporate-wide. - **ACCESS – employees, customers, partners have ubiquitous access to information and processes. Data Source: Center for Research in Electronic Commerce, Graduate School of Texas at Austin. © 2000

E-Customer Service and Support GBC Agenda The opportunity stakes are high for companies seeking to improve productivity, growth and financial results in their businesses using in these important e-business areas. E-Human Resources Tomorrow’s HR: Leveraging the Power of the Internet – Fidelity Investments Turning HR into HR E-Business - IBM E-Customer Service and Support Dell’s E-Support System TI’s New KnowledgeBase: A Case Study GBC Member Roundtables E-Sales and Marketing E-Sales, E-Marketing & E-Service: Best Practices, LLC Consortium Preliminary Findings The Future of E-Marketing - Cisco Systems Benchmarking Nuts and Bolts Benchmarking at Dell Computer