Strategy For The 21 st Century Prometheus Process venturist ® incorporated Target For Success: Determine The Desired Effects Design the Future Target for Success Campaign to WinFinish with Finesse Map the Relevant Systems Identify the Centers of Gravity Determine the Desired Effects

Strategy For The 21 st Century venturist ® incorporated Copyright Venturist®, Inc – All Rights Reserved Licensed To Advanced Micro Devices, Sunnyvale, CA and Austin, TX Strategic Impact Plans To Reach Your Future Picture, Change The Relevant Systems By Affecting Their Centers of Gravity Each Center Of Gravity Must Change In A Specific Way To Create The System Change That Leads To The Future Picture Impact Plans Show What Needs To: –Happen To Each Center Of Gravity (Strategic Impact Plan) –And How It Will Be Done (Tactical – Action Plan) Strategic Impact Plans And Action Plans Are Derived From Your Future Picture And External System Effects

Strategy For The 21 st Century venturist ® incorporated Copyright Venturist®, Inc – All Rights Reserved Licensed To Advanced Micro Devices, Sunnyvale, CA and Austin, TX Strategic Impact Plans Derive From Future Picture

Strategy For The 21 st Century venturist ® incorporated Copyright Venturist®, Inc – All Rights Reserved Licensed To Advanced Micro Devices, Sunnyvale, CA and Austin, TX Strategic Impact Plans Components Components of Strategic Impact Plan –Desired Effect: What Needs To Happen To A COG (Its End State) –COG Strategic Measurement Plan: Measures Progress Toward The Desired Effect –Timeframe: When Must The Desired Effect Be Realized Stay At The Strategic High Level Until You Can’t Stand It; Going To Tactics Sub-optimizes Efforts And Is Dangerous If You Know The COG And The Desired Effect, There Is A Way To Make It Happen—Always

Strategy For The 21 st Century venturist ® incorporated Copyright Venturist®, Inc – All Rights Reserved Licensed To Advanced Micro Devices, Sunnyvale, CA and Austin, TX Action Plans Tactical Components Components Of An Action Plan –Actions: How Will It Be Done –Teams: Who Will Have Responsibility –Resources: What Will It Cost: –Timing: When Must It Be Done –Corrordination: Deconfliction

Strategy For The 21 st Century venturist ® incorporated Copyright Venturist®, Inc – All Rights Reserved Licensed To Advanced Micro Devices, Sunnyvale, CA and Austin, TX Strategic Impact Plans Participation As Many People As Possible Should Take Part In Building And Understanding The Strategic Impact Plan Tactical Execution Can Be Done By Groups Working On Their Own, There Is A Way To Make It Happen—Always

Strategy For The 21 st Century venturist ® incorporated Copyright Venturist®, Inc – All Rights Reserved Licensed To Advanced Micro Devices, Sunnyvale, CA and Austin, TX System Effects and Sample COGs--Iraq Saddam Hussein Army military officers Roads & Bridges Electricity IRAQ: Desired System Effects Collapses To Weak Energy State No Strategic Offensive Capability Enough Energy To Survive & Defend Itself

Strategy For The 21 st Century venturist ® incorporated Copyright Venturist®, Inc – All Rights Reserved Licensed To Advanced Micro Devices, Sunnyvale, CA and Austin, TX Iraq--Determining Desired Effects An Impact Plan Extract Saddam Hussein Electrical System Sample Centers of Gravity Desired Effect Measure of Merit Time Frame Roads and Bridges Military Officers Air Defense Ineffective Leadership During The War Little or No Electricity Available Around Country Unable To Support Surface Mobility Officers Separated From Saddam Unable To Interfere With US Air Operations Insufficient Supplies Reaching Deployed Fielded Forces Physically Gone, No Evidence of Rational Response Lights Out In Baghdad (and the Other Major Cities) Defections, Unit Surrenders, Rebellions Few or No US Air Losses First 24 Hours of War First Hour of War For Baghdad Area; 3-5 Days For Rest First Week With Results Clear In Three Weeks During Course of War First Twelve Hours

Strategy For The 21 st Century venturist ® incorporated Copyright Venturist®, Inc – All Rights Reserved Licensed To Advanced Micro Devices, Sunnyvale, CA and Austin, TX Disneyland Hypothetical Future Picture Financial Position: Generating Profit, No-Debt Market Position: Disruptive Driver Of New Theme Park Market Business Areas: Family Oriented Theme Parks And Complementary Products Innovation: Disruptive Driver Of Redefined Theme Park Market Insider Perception: A Company On The Cutting Edge Of Innovative Entertainment And Customer Service Outsider Perception: The Place To Take Your Family (And Yourself) And A Superior Business Investment Workforce Characteristics: Imaginative, Empathetic, Industrious, Hardworking, Self-starters Brand: Yes: The Place For Family Entertainment Corporate Culture: Semi-autocratic; Open Planning; Participative Corporate Citizenship: Contributions From Profits To Designated Charities Ownership: Everyone A Stockholder With Walt The Controlling Stockholder; Disneyland 100% Owned By Disney Incentive Philosophy: Salaries High Enough To Attract And Hold Right People; Bonuses To All When Profits Justify Future Picture Horizon: 1960 Execution Start: 1951

Strategy For The 21 st Century venturist ® incorporated Copyright Venturist®, Inc – All Rights Reserved Licensed To Advanced Micro Devices, Sunnyvale, CA and Austin, TX Market Desired Effects Disneyland Illustration Timeframe: 9 Years ( ) Market Fiscal State –5X Increase In Money Spent On Theme Park Attendance ( ) Market Awareness, Perceptions, And Attitudes –Market Excited By Opportunity For Family Trips To Theme Parks, Sees Theme Parks As Wholesome, Exciting, Safe, And Educational. High Recognition For Brand Market Technology State –Ability To Create Ultra-Realistic Settings And Manage Crowds Market Scope –Market Moves From Local To International; Includes Teenagers And Adults As Primary Visitors Market Obstacles –Local Governments Build Access Roads; Zoning And Tax Rules Are Friendly; Regulators Work With Disney To Establish New Standards Momentum –Market Growing Rapidly (Sufficient To Accommodate Disneyworld—And International?)

Strategy For The 21 st Century venturist ® incorporated Copyright Venturist®, Inc – All Rights Reserved Licensed To Advanced Micro Devices, Sunnyvale, CA and Austin, TX Internal (Organization) System Desired Effects Disneyland Example Fiscal –Revenue Sufficient To Provide Free Cash Flow For Improvements, Long-term Debt Payoff, And Profits For WDC Business –Disneyland Able To Operate Smoothly At Capacity; Capacity Growing; Complementary Items Developed And Offered For Sale; Disneyworld Planning Underway Innovation –Robust Innovation Process In Place; New Attractions In Operation; More People Able To Visit Disneyland With Less Wait-time; Superb Customer Service People –Creative Workforce Improving Attractions And Processes At An Impressive Rate; Guests Commenting On How All Their Needs Are Anticipated; Site Immaculate; And Supervisors Complaining That They Can’t Keep Up With Their Subordinates –Associates Proud, Have Morale High, Are Receiving High Marks For Customer Service, And Are Buying WDC Stock. Few People Want To Leave Culture –Everyone Involved, Great Ideas Flowing, Strategically Aligned, Executing Quickly And Effectively Incentives –Incentive Plan Functioning, Understood, And Appreciated; Salaries High; The Right People Staying. Non-Monetary Rewards Well-Received

Strategy For The 21 st Century venturist ® incorporated Copyright Venturist®, Inc – All Rights Reserved Licensed To Advanced Micro Devices, Sunnyvale, CA and Austin, TX Hypothetical Disneyland Master Effects Plan

Strategy For The 21 st Century venturist ® incorporated Copyright Venturist®, Inc – All Rights Reserved Licensed To Advanced Micro Devices, Sunnyvale, CA and Austin, TX Impact Plan Case Study Disneyland Illustration Illustrative Phase One and Phase Two External And Internal Centers Of Gravity LeadershipProcessesInfrastructurePopulationAction Units E-ABCE-TransportationRoadse-parentsE-Airlines E-Key MediaConstructioncast membersMaintenance Division E-Investment Bankers e-travel agents Strategic Impact Plans And Action Plans For These Centers of Gravity Derived Directly From Phase One And Phase Two Internal And External Desired System Effects

Strategy For The 21 st Century venturist ® incorporated Copyright Venturist®, Inc – All Rights Reserved Licensed To Advanced Micro Devices, Sunnyvale, CA and Austin, TX Market Leadership Ring Strategic Impact Plan Center Of Gravity: E-ABC TV (Phase I) Desired Effect: Provides Joint-Venture Funding And Publicity For Disneyland Measures Of Merit: Money Deposited In Disney Bank 50% Of Target Market Says Will Make Trip To Disneyland Timeframe: Money In Bank December % of Target Market As Above By December 1954

Strategy For The 21 st Century venturist ® incorporated Copyright Venturist®, Inc – All Rights Reserved Licensed To Advanced Micro Devices, Sunnyvale, CA and Austin, TX Market Process Ring Strategic Impact Plan Center Of Gravity: E-Transportation (Phase II) Desired Effect: Transportation Easily Available For Tourists From Airport To Disneyland At No Cost To Disney Measures Of Merit: Transport Available At Reasonable Cost And Wait-Time No Costs Or Responsibility On Disney Side Timeframe: January 1955 (Six Months Prior To July 1955 Opening)

Strategy For The 21 st Century venturist ® incorporated Copyright Venturist®, Inc – All Rights Reserved Licensed To Advanced Micro Devices, Sunnyvale, CA and Austin, TX Internal Process Ring Strategic Impact Plan Center Of Gravity: Construction (Phase I) Desired Effect: Construction Process Leads To Opening In July 1955 With All Systems Functioning Measures Of Merit: Projects meeting schedule, ready for opening Timeframe: Three Months From Campaign Kickoff

Strategy For The 21 st Century venturist ® incorporated Copyright Venturist®, Inc – All Rights Reserved Licensed To Advanced Micro Devices, Sunnyvale, CA and Austin, TX Market Infrastructure Ring Strategic Impact Plan Center Of Gravity: E-Zoning Regulations (Phase I) Desired Effect: Orange County Zoning Permits Theme Park Construction With Materials And Methods Developed And Approved By Disney Measures Of Merit: Permits Granted Inspectors Use Disney Specifications Timeframe: December 1953

Strategy For The 21 st Century venturist ® incorporated Copyright Venturist®, Inc – All Rights Reserved Licensed To Advanced Micro Devices, Sunnyvale, CA and Austin, TX Market Population Ring Strategic Impact Plan Center Of Gravity: e-travel agents (Phase II) Desired Effect: Travel Agents Enthusiastic About Disney Trips And Motivated To Sell Them Measures Of Merit: # Travel Agent Requests For Brochures 50% Of Disney Hotels Filled By Travel Agent Bookings # Positive Trade Show Buzz Timeframe: Brochures—June 1954; Bookings—March 1955

Strategy For The 21 st Century venturist ® incorporated Copyright Venturist®, Inc – All Rights Reserved Licensed To Advanced Micro Devices, Sunnyvale, CA and Austin, TX Internal Population Ring Strategic Impact Plan Center Of Gravity: cast members (Internal) (Phase II) Desired Effect: Take Care Of Disneyland Like It Was Theirs And Treat Visitors Like Their Rich Aunt Measures Of Merit: Dropped Trash Spends Less Than One Minute On The Ground Visitors Rave About Customer Service During Exit Interviews/Surveys Timeframe: July 1955

Strategy For The 21 st Century venturist ® incorporated Copyright Venturist®, Inc – All Rights Reserved Licensed To Advanced Micro Devices, Sunnyvale, CA and Austin, TX Market Action Unit Ring Strategic Impact Plan Center Of Gravity: E-Airlines (Phase II) Desired Effect: Airlines Increase Service To Southern California And Successfully Promote It Measures Of Merit: Service Increases To Meet Expected Disneyland Demand Airlines Have High (75%) Load Factor To Orange County Airport Timeframe: Service Increase—July 1955; High Load Factor—September 1955

Strategy For The 21 st Century venturist ® incorporated Copyright Venturist®, Inc – All Rights Reserved Licensed To Advanced Micro Devices, Sunnyvale, CA and Austin, TX Internal Action Unit Ring Strategic Impact Plan Center Of Gravity: Maintenance Division (Phase II) Desired Effect: Maintenance Division Keeps Attractions Operating Safely At Happy Customer Levels Measures Of Merit: No Preventable Customer Injuries Attractions Functioning 99% Of Time Very Few Customer Complaints (<1/1,000 visitors) Timeframe: July 1955

Strategy For The 21 st Century venturist ® incorporated Copyright Venturist®, Inc – All Rights Reserved Licensed To Advanced Micro Devices, Sunnyvale, CA and Austin, TX Desired Effects Focus On Results Realize Future Picture By Affecting The System—Individual, Country, Market, Company Force Changes In The Energy Level of The Target Systems Measure Success Against Effect on Function, Not On Inputs Or Tactical Results Make The “Desired Effects” A Reality! –Recognize Effort, Reward Success

Strategy For The 21 st Century venturist ® incorporated Copyright Venturist®, Inc – All Rights Reserved Licensed To Advanced Micro Devices, Sunnyvale, CA and Austin, TX Action Plans Derive From Strategic Impact Plans

Strategy For The 21 st Century venturist ® incorporated Copyright Venturist®, Inc – All Rights Reserved Licensed To Advanced Micro Devices, Sunnyvale, CA and Austin, TX Basic Action Plan Format Sample Action Plan COG: engineers Desired Effect: engineers think and act strategically Timeframe: 4/10 ActionStartDueResourcesAssigned To Plan one day Prometheus orientation for engineers 1/52/52 Man daysBill Obtain funding to market, plan and execute orientation 2/62/81 Man dayBob Get Organizational Approval to Conduct orientation on specific date 2/82/92 HoursDan Induce engineers to participate in the orientation 2/103/9$1000 MarketingJane Reserve facility for orientation2/62/9$250 FeeBob Arrange secondary logistics—food, transportation, technology. 2/63/14 Man daysJohn Execute the orientation session3/10 $3000 for food, transportation and other logistics Bill and Jim Assess engineer’s understanding of process3/104/10$250 Survey FeeJane Assess engineer’s commitment to strategic thinking. 3/104/10$250 Survey FeeBill Standardize Action Plan Formats Within Your Organization For Ease Of Coordination

Strategy For The 21 st Century venturist ® incorporated Copyright Venturist®, Inc – All Rights Reserved Licensed To Advanced Micro Devices, Sunnyvale, CA and Austin, TX Translating Strategic Impact Plans Into Action Plans

Strategy For The 21 st Century venturist ® incorporated Copyright Venturist®, Inc – All Rights Reserved Licensed To Advanced Micro Devices, Sunnyvale, CA and Austin, TX Translating Strategic Impact Plans Into Action Plans

Strategy For The 21 st Century venturist ® incorporated Copyright Venturist®, Inc – All Rights Reserved Licensed To Advanced Micro Devices, Sunnyvale, CA and Austin, TX Translating Strategic Impact Plans Into Action Plans

Strategy For The 21 st Century venturist ® incorporated Copyright Venturist®, Inc – All Rights Reserved Licensed To Advanced Micro Devices, Sunnyvale, CA and Austin, TX Translating Strategic Impact Plans Into Action Plans

Strategy For The 21 st Century venturist ® incorporated Copyright Venturist®, Inc – All Rights Reserved Licensed To Advanced Micro Devices, Sunnyvale, CA and Austin, TX Fractal Analysis Strategic Impact Planning For Complex Centers of Gravity Developing A Fractal System Is Required Any Time You Encounter A Complex Center Of Gravity. Complex Centers Of Gravity Will Inevitably Result From One Of Two Factors: –The Overall External And Internal System Maps Represent Systems At A High Level Of Abstraction. –Regardless Of The Overall Level Of Abstraction, Individual Centers Of Gravity In The Systems Represent Large Organizations, Complex Processes And Systems, Extensive Pieces Of Infrastructure Or Large Demographic Groups.

Strategy For The 21 st Century venturist ® incorporated Copyright Venturist®, Inc – All Rights Reserved Licensed To Advanced Micro Devices, Sunnyvale, CA and Austin, TX Fractal Analysis Strategic Impact Planning For Complex Centers of Gravity Fractal Analysis Is A Tool To Find Simple Solutions To Tough Problems –Not A Device To Create More Work Keep Focus On Strategic Impact Plan For Parent Center Of Gravity Find And Work Only Those Fractal Centers Of Gravity Necessary To Achieve Parent Desired Effect Up-channel Reporting Should Be Based On Progress Toward The Parent Center Of Gravity—Not The Fractal Tools

Strategy For The 21 st Century venturist ® incorporated Copyright Venturist®, Inc – All Rights Reserved Licensed To Advanced Micro Devices, Sunnyvale, CA and Austin, TX LeadershipProcessesInfrastructurePopulationAction Units Minister of Interior Energy Conversion Transmission Lines managersState Security Forces Chief, Iraqi Electrical Grid Electric Generation engineersRepair Teams Site ManagerVoltage Control Fractal COGs The Electrical System

Strategy For The 21 st Century venturist ® incorporated Copyright Venturist®, Inc – All Rights Reserved Licensed To Advanced Micro Devices, Sunnyvale, CA and Austin, TX Fractal Process Example Client Organizational System LeadershipProcessesInfrastructurePopulationAction Units Key ClientsQuality ProcessBuilding (Physical Plant) managementOutside Brokers CEOManufacturing Process salariedSales Force InvestorsSelling ProcesshourlyManufacturing Operations BankersCustomer Service Process customers SuppliersTechnical Support Process vendors Board of Directors Strategic Planning Process stockholders Senior Management Team Research and Development Process temps Accounting Process

Strategy For The 21 st Century venturist ® incorporated Copyright Venturist®, Inc – All Rights Reserved Licensed To Advanced Micro Devices, Sunnyvale, CA and Austin, TX Strategic Impact Plan For Complex Selling Process COG Selling Process –Desired Effect: The Selling Process closes sales deals that maximize margins. Measures: Growth of margin over current customer mix year over year. Target Date: 12 months –Desired Effect: The Selling Process reduces time to close deals. Measures: Number of customers sold within a six month selling cycle. Target Date: 9 months –Desired Effect: The Selling Process produces long-term relationships and contracts. Measures: Market Plan developed for each customer and retention of 100% of desired customer base. Target Date: 18 months –Desired Effect: The Selling Process identifies and develops value added relationships with strategic customers. Measures: Number of customers/items sold above the average level of margin for that customer and dollars of sales of value added services. Target Date: 3 months

Strategy For The 21 st Century venturist ® incorporated Copyright Venturist®, Inc – All Rights Reserved Licensed To Advanced Micro Devices, Sunnyvale, CA and Austin, TX Fractal System From Complex Selling Process Center of Gravity LeadershipProcessesInfrastructurePopulationAction Units Sales ManagerProspectingCarssales forcePlants Plant ManagersTechnical SkillsHome Office customer support reps Sales Rep CustomersStrategyPlanesquality assurance Presentingestimators Estimatingbrokers Pricingtechnical support Quoting Qualifying Specification Writing Closing Maintaining

Strategy For The 21 st Century venturist ® incorporated Copyright Venturist®, Inc – All Rights Reserved Licensed To Advanced Micro Devices, Sunnyvale, CA and Austin, TX Strategic Impact Plan For Strategy COG From Selling Process COG Strategy –Desired Effect: The Selling Strategy Process Identifies The Best Customers And Matches With Well Developed Selling Plans Before First Call. Measures: “Good” Customers Identified. Cost, Needs, Competitive Forces, Our Strengths, Alternatives Planned And Approved Prior To Quote. Target Date: 3 Months

Strategy For The 21 st Century venturist ® incorporated Copyright Venturist®, Inc – All Rights Reserved Licensed To Advanced Micro Devices, Sunnyvale, CA and Austin, TX Second Fractal Breakdown Of Strategy Fractal COG From Selling COG Fractal LeadershipProcessesInfrastructurePopulationAction Units CustomerStrength Analysis Own Equipmenttechnical supportDesign Team Sales Manager Presentation of Capability Customer Equipment Technical Reps Plant ManagersDesign Review Sales Reps Profitability Analysis Cost Need Analysis Market Trends Purchasing System Competition Analysis Strategy =

Strategy For The 21 st Century venturist ® incorporated Copyright Venturist®, Inc – All Rights Reserved Licensed To Advanced Micro Devices, Sunnyvale, CA and Austin, TX Strategic Impact Plan For Profitability COG From Strategy Process COG Profitability Analysis Process –Desired Effect: The Profitability Analysis Process Determines Profitability Of Potential Customers Rapidly, Reliably, And Accurately Measures: Profit Analysis Of A Potential Customer Ready Within Two Days Of A Request; Same Results When Done By Different People; And Results Borne Out By Customer Experience Target Date: 3 Months

Strategy For The 21 st Century venturist ® incorporated Copyright Venturist®, Inc – All Rights Reserved Licensed To Advanced Micro Devices, Sunnyvale, CA and Austin, TX Fractal Centers Of Gravity

Strategy For The 21 st Century venturist ® incorporated Copyright Venturist®, Inc – All Rights Reserved Licensed To Advanced Micro Devices, Sunnyvale, CA and Austin, TX De-Conflicting Fractals And Action Plans Campaign 1 – Key Doctors COG: –Fractal COG: Doctors At UAB Action: VP of Sales Will Brief Five Key Doctors At UAB Hospital On New Repair- Exchange Process on 6/30/05 Campaign 2 – Key Teaching Hospitals COG: –Fractal COG: UAB –2 nd Fractal: Key Doctors Action: VP of Operations Brief Five Key Doctors At UAB Hospital On New Repair-Exchange Process on 7/1/05 Solution: Two Campaigns Work Together To Come Up With A Simple Desired Effect And Process To Move COG To Desired Effect Position. For Example: VP Ops And VP Sales Co-Present To Key Doctors Two Action Plans With Objective Conflict

Strategy For The 21 st Century venturist ® incorporated Copyright Venturist®, Inc – All Rights Reserved Licensed To Advanced Micro Devices, Sunnyvale, CA and Austin, TX System Strategy The Essence of System Strategy Understand The Relevant Systems Identify The Centers of Gravity Decide Effect To Impose Act Analysis Leads To What, Not How “The Enemy Of Change Is The System”

Strategy For The 21 st Century Prometheus Process venturist ® incorporated Prometheus Process Desired Effects Insights and Discussion