1. © Evalueserve, 2006. All Rights Reserved - Privileged and Confidential Study for Identifying Potential Sales Opportunities

2. © Evalueserve, 2006. All Rights Reserved - Privileged and Confidential Slide 2 1.Study Background and Objectives 2.Research Methodology 3.Key Findings 4.Sample Demographics 5.XYZ Usage 6.Future Plans (Upgrades and IT Installations) 7.Satisfaction Level and Need Gaps 8.Summary Contents CONTENTS

3. © Evalueserve, 2006. All Rights Reserved - Privileged and Confidential Slide 3 Study Background and Objectives The client has been in stiff competition with XYZ in the ERP applications market. The client has launched a sales program, targeting companies that are currently using XYZ. The study will help the client to: 1. Identify sales opportunities among the XYZ users 2. Identify other opportunities such as database applications used by XYZ users 3. Evaluate satisfaction levels and pain points for XYZ users 4. Identify their willingness to continue with XYZ ERP system or to shift to any other ERP system.

4. © Evalueserve, 2006. All Rights Reserved - Privileged and Confidential Slide 4 Research Methodology The study involved conducting primary research with the senior management and IT decision makers of companies using XYZ, in the APAC region. Evalueserve and the client designed a structured questionnaire and conducted a telephonic survey with the XYZ installed base (provided by client) in a phased manner Fieldwork Pilot Stage – Evalueserve conducted 71 interviews with an initial questionnaire Questionnaire revision based on pilot results Fieldwork Main Stage – Evalueserve conducted 360 interviews Respondents were screened on their involvement with decision-making on ERP systems within their organizations. A representative mix in terms of country, industry and company size was maintained. Raw data was collated, cleaned and analysed to draw key insights.

5. © Evalueserve, 2006. All Rights Reserved - Privileged and Confidential Slide 5 Key Findings XYZ users face a series of difficult and costly upgrades. This implies significant opportunities for the client’s sales program Most XYZ users feel “locked in” by large sunk costs or contractual obligations XYZ users are largely unaware of low cost migration options The client has a potential target segment comprising customers using older XYZ versions Action points for client Strong sales communication Focus on flexible licensing terms Focus on key target segments

6. © Evalueserve, 2006. All Rights Reserved - Privileged and Confidential Slide 6 Key Markets N=431

7. © Evalueserve, 2006. All Rights Reserved - Privileged and Confidential Slide 7 Target Companies by Size Company Size (By employees) Company Size (By Revenues in USD) N=298 N=358 N excludes respondents who refused to answer or were not aware of the figures

8. © Evalueserve, 2006. All Rights Reserved - Privileged and Confidential Slide 8 Target Companies by IT Spending IT Budget (as % of total revenues) Spending on XYZ (as % of IT budget) N=166 N=194 N excludes respondents who refused to answer or were not aware of the figures

9. © Evalueserve, 2006. All Rights Reserved - Privileged and Confidential Slide 9 XYZ User Licences and Versions Number of User Licenses XYZ Versions Used Currently Number of Licenses % < 10030% 100 – 500 40% 500 – 1000 20% >100010% XYZ Installation Tenure N=379 N=406 Age% < 1 Year11% 1 – 3 Years 38% 3 – 5 Years 28% 5-7 Years20% > 7 Years3% N=419 ‘Version 1’ and ‘Version 2’ are the most commonly used XYZ versions On an average, most companies have between 100–500 licenses and are using their current XYZ application for about 1-3 years More than 75% of organizations go for a version upgrade after 5 years, and only 3% continue with the same version for more than 7 years N excludes respondents who refused to answer or were not aware of the figures

10. © Evalueserve, 2006. All Rights Reserved - Privileged and Confidential Slide 10 Purchase and Implementation YesNo 98%2% Is the system fully implemented? N=276N=51 43% of the respondents said that their present version has been upgraded 98 % of the respondents whose present version has been upgraded, have fully implemented the system N excludes those who are using version 11, version 12, version 13 and those who are using the current version for >60 months N includes only those who have upgraded

11. © Evalueserve, 2006. All Rights Reserved - Privileged and Confidential Slide 11 Databases Currently Used For XYZ For Other Applications N=387 N=402 Client’s database is used by 22% of respondents A significant 20% of the XYZ users use Microsoft SQL server for their other applications N excludes respondents who refused to answer or were not aware of the figures

12. © Evalueserve, 2006. All Rights Reserved - Privileged and Confidential Slide 12 Upgrade Plans Currently engaged in implementing upgrades Engaged in talks with XYZ regarding upgrades Thinking of upgrading our ERP systems, but we have not decided on the supplier Thinking of upgrading our ERP systems, but we have already decided not to go with our current supplier We do not have plans to upgrade in the near future N=431 TechnicalFunctional 73%27% Nature of Upgrades N=160 40% of the XYZ users are either in the process of implementing their upgrades, or are still in the decision making stage 20% of respondents have decided to switch suppliers or are undecided 73% of those who are in the implementation stage or are deciding on upgrades, are implementing technical upgrades Client Opportunities Potential targets for sales communication N excludes respondents who do not have plans to upgrade in the near future & those who are not aware

13. © Evalueserve, 2006. All Rights Reserved - Privileged and Confidential Slide 13 Timeframe for Upgrades More than half of the respondents have an upgrade horizon of 6 months or more N excludes respondents who do not have plans to upgrade in the near future & those who are not aware/refused Timeframe Less than 3 months 3 – 6 months 6 – 12 months More than 12 months Client Opportunities N=163

14. © Evalueserve, 2006. All Rights Reserved - Privileged and Confidential Slide 14 Budget for Upgrades (Overall) Less than USD 100,000 USD 100,000 to USD 250,000 USD 250,000 to USD 500,000 More than USD 500,000 Budget Break-up of Budget Licensing Services Hardware Over one third of respondents have a budget of between $100,000 - $250,000 for upgrades Though there is no unidirectional trend on spending patterns, XYZ users expect to realize scale economies in license spending only on very large overall outlays N excludes respondents who do not have plans to upgrade in the near future & those who are not aware/refused N=119

15. © Evalueserve, 2006. All Rights Reserved - Privileged and Confidential Slide 15 Future Implementation of IT Projects Databases Middleware Content and Knowledge Management Others No Yes Web Conferencing and United Messaging N=427 Approximately 5-10% of the XYZ users are considering implementation of IT projects in areas such as databases, middleware, content management and web- conferencing N excludes respondents who refused to answer or were not aware

16. © Evalueserve, 2006. All Rights Reserved - Privileged and Confidential Slide 16 Satisfaction with XYZ Installations Factor 1 Factor 2 Factor 3 Factor 4 Factor 5 Factor 6 Factor 7 Factor 8 Factor 9 Overall N=431 % of respondents who are ‘very dissatisfied’ and ‘dissatisfied’ Majority of the XYZ users are dissatisfied with ‘parameter 1’ and ‘parameter 2’ for their XYZ applications Mean Ratings 3.1 3.0 3.1 2.9 2.3 2.4 3.0 1=Very Dissatisfied 4=Very Satisfied

17. © Evalueserve, 2006. All Rights Reserved - Privileged and Confidential Slide 17 Satisfaction with XYZ Installations (by key markets) N=431 % of respondents who are ‘very dissatisfied’ and ‘dissatisfied’ Overall, dissatisfaction with respect to most factors such as ‘factor 1’ and ‘factor 2’ is highest in Greater China and is the least in India Greater China reports the greatest dissatisfaction for all parameters except ease of use (ANZ reports the least satisfaction) and industry specificity (Other APAC reports the least)

18. © Evalueserve, 2006. All Rights Reserved - Privileged and Confidential Slide 18 Likelihood of Continuing with XYZ Very likely to continue Likely to continue Undecided Not likely to continue Not at all likely to continue N=431 While many feel that there are improvement areas for XYZ, almost 90% of them are likely to continue with XYZ citing high migration cost as one of the key reasons.

19. © Evalueserve, 2006. All Rights Reserved - Privileged and Confidential Slide 19 Likelihood of Continuing with XYZ (by Company Size) Clearly, smaller companies are feeling the pinch of costly upgrades and “lock-in” contracts Average Company Revenues in Million (USD) Likelihood of Continuing with XYZ N excludes respondents who refused to answer or were not aware ~ $2 bn ~ $2.5 bn ~ $900 mn ~ $500 mn ~ $ 100 mn

20. © Evalueserve, 2006. All Rights Reserved - Privileged and Confidential Slide 20 Priority Leads for the client N=53 N=25 Among those who are undecided or are not likely to continue using XYZ, 47% said that they are likely to consider the client for their ERP applications and relevant upgrades N excludes respondents who are likely to continue with XYZ N excludes respondents who are not likely to consider client

21. © Evalueserve, 2006. All Rights Reserved - Privileged and Confidential Slide 21 Lead Matrix Focus on pricing and “ sell ” ease of migration Low-hanging fruit Understand needs and position suitably Likelihood of Continuing with XYZ Low High Overall Satisfaction with XYZ Low High N = 5 N = 3 N = 32 Effective Marketing Differentiate N =15 N = 26 Undecided There is a strong case for pro-active communication of sales benefits Even if organizations are unhappy with XYZ, they may be undecided about their supplier choice as they perceive costs of migration (including implicit costs) to be too high N = 350

22. © Evalueserve, 2006. All Rights Reserved - Privileged and Confidential Slide 22 Summary XYZ Pain Points  This study validates the industry viewpoint that XYZ users face a series of difficult and costly upgrades. The pinch is more likely to be felt across relatively smaller XYZ customers, where scalability in terms of licensing costs is more difficult to achieve.  Majority of the XYZ users are dissatisfied with the ‘factor 1’ and ‘factor 2’ for their XYZ applications  Key performance-related areas of improvement for XYZ are data base retrieval, reporting etc. XYZ Usage  The most commonly used XYZ versions are version 1 and version 2  Modules like ‘BI’, ‘CRM, ‘HR’ and ‘SCM’ have not been implemented by majority of the XYZ users

23. © Evalueserve, 2006. All Rights Reserved - Privileged and Confidential Slide 23 Summary Opportunities for the client  Key target segments: Smaller XYZ customers XYZ users who are concurrently using other databases and applications XYZ users who are actively planning to upgrade within the next 6 months or more  Direct Leads - 25 organizations actively mentioned client as an option they were willing to consider  Cross selling - 22% of respondents across the XYZ installed base are using client’s databases  Upgrades - 9% of respondents may not engage XYZ for upgrades and more than half of them have adequate timeframes  Key sales marketing messages: Low cost migration alternatives that work Flexible licensing terms Ability to provide strong support during the migration phase

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