1. © 2010 IBM Corporation Improving Business Results via the Implementation of GS1 Standards and Industry Best Practices Findings of the TCGF Global Compliance Survey 2009-2010

2. © 2010 IBM Corporation The Global Scorecard A The Consumer Goods Forum tool for Internal and Trading Partner Collaboration 2 A Key Enabler from the IT- Connecting Business for Consumers Committee

3. © 2010 IBM Corporation The Community or Who is behind it?  The Owner: TCGF / IT – Connect Our Business Committee –Merger of the Global CEO Forum, GCI and CIES. –Independent global parity-based consumer goods network.  650 retailers, manufacturers, service providers, others from 70 countries.  The Host: IBM –Technical host of the Global Scorecard tool. –Validity check and direct support for users. –Creates global reports and analyses.  The Community Builders: GS1 and ECR Organisations –Promote the use of the Global Scorecard by companies in their country. –Support for users. –Use the Global Scorecard to assess the implementation of GS1 standards.  The Team –Exists since 1999 and keeps the Global Scorecard aligned with today’s and tomorrow’s business requirements. –Promotes the Global Scorecard and provides expert knowledge. 3

4. © 2010 IBM Corporation What is the Global Scorecard?  It is a tool that uses a common language and measurement system to enable – Companies Internally – Trading Partners Collaboratively – And, the Industry Collectively  To understand how well we are doing – Relative to the capabilities we have built and the benefits we expect those capabilities to deliver The Value of a Common Language and Measurement System 4

5. © 2010 IBM Corporation5 The Global Scorecard - a Capability Assessment Tool has been designed 10 years ago to give you a detailed understanding of your ECR capability each year and to highlight specific improvement opportunities for your company. You are able to compare your company with the peers in your industry. Questions presented to the participant depend on the business type and industry sector. Content Profile Used for the annual report Standard Capability Assessment (Measures the status of implementation) Demand Supply Enablers (Item identification, Electronic messages and master data synchronization) Integrators Business Measures (e.g. Service levels, inventory, out-of-stocks, lead time, costs, invoice accuracy) Implementation Measures (Measures the level of implementation for e.g. Item and location identification, EDI, Global Data Synchronization)

6. © 2010 IBM Corporation6 We observe that most of the standards increased over the last years for the retailers & wholesalers; as many of the new participating manufacturers are smaller companies some implementation levels are lower than in the years before ManufacturersRetailers & Wholesalers 200720082009200720082009 IM01 % of consumer units allocated a GTIN 97.196.892.091.797.396.6 IM02 % of cases/cartons/inners allocated a GTIN 82.987.686.677.482.687.0 IM04 % of pallets/unit loads labeled with SSCC 45.949.467.251.149.471.6 IM05 % of shipping or receiving locations that have been allocated a GLN 43.941.251.164.374.587.5 IM06 % of orders transacted via EDI 52.451.747.068.870.475.8 IM07 % of invoices transacted via EDI 41.547.745.663.467.178.6 IM08 % of shipments for which a despatch advice was transmitted via EDI 22.527.635.528.022.458.7 IM09 % of shipments for which a receiving advice was transacted via EDI 7.112.016.029.813.958.4 IM10 % of sales with synchronized master data between trading partners via the GS1 Global Data Synchronization Network 13.519.024.49.417.042.4 IM11 % of sales with master data loaded into a GS1-certified data pool (%) 37.741.6** IM12 % of active SKUs where the master data has been synchronized using the GS1 Global Data Synchronization Network 2.97.026.5 IM13 % of GTINs that are catalogued consistently with a GS1 Global Product Classification brick code 45.747.271.0

7. © 2010 IBM Corporation7 The number of the submitted KPI scorecards increased again in 2009/2010 5,624 KPI records accepted in 2010 3,637 KPI records accepted in 2008 2,788 KPI records accepted in 2007 892 KPI records accepted in 2006 Increase driven by adoption of the Implementation Measures by GS1 MOs

8. © 2010 IBM Corporation8 … it is only a small tag, but the amount of data that is collected and can be analysed is enormous Data sharing as imperative and basis for powerful analytics ftp://public.dhe.ibm.com/common/ssi/ecm/en/cie03046usen/CIE03046USEN.PDF Using GS1 Standards is the key for all activities

9. © 2010 IBM Corporation9 Many direct effects of the implementation of standards on the Business Measures could be captured in the Global Scorecard survey Efficiency Customer Satisfaction Improved Quality Sustainability Competitive advantage Time saving Cost reduction Improved supply chain operations Improved visibility Increased understanding of retailers needs and become preferred collaboration partner Increased sales Improved client relationship Improved customer satisfaction Better information availability Improved data quality Fewer invoice-disputes Improved Image & Brand Less Waste Optimized usage of resources Better overview of inventory Supplier Service Level   GTIN on consumer units  GTIN on cases/cartons/inners  GTIN catalogued with GS1 Product classification code Store Service Level   SSCC  EDI for orders  EDI despatch advise  Sales with synced master data  GTIN catalogued with GS1 Product classification code Annual Revenue Growth Rate   Roll out and full implementation of Trading partner performance standards (E401) Out of stocks   GTIN on cases/cartons/inners  SSCC  EDI for orders  EDI for despatch advice  GTIN catalogued with GS1 Product classification code On-time delivery   GTIN catalogued with GS1 Product classification code Invoice accuracy   EDI for invoices (manufacturers)  Distribution costs   GTIN on consumer units  GTIN on cases/cartons/inners  Sales with synchronized master  data via GDSN Order to delivery cycle time   GTIN on consumer units  GTIN on cases/cartons/inners Improvements through implementation Examples

10. © 2010 IBM Corporation10 Retailers & wholesalers tend to implement the standards on a higher average implementation level than manufacturers

11. © 2010 IBM Corporation11 There is still potential for many standards, especially Data Synchronisation 96% of all companies have indicated an implementation level 4,779 KPI scorecards 91% indicated an implementation level above 0 5% have responded by indicating a 0- implementation level

12. © 2010 IBM Corporation12 The fresh food & perishable produce industry is the driver of implementing measures, independently of the size of the company n=4779 Books, Journals, Music, Video Heath & Beauty Electrical Goods Textile Multiple product categories (incl. fresh food) Dry Grocery, non food Multiple product categories (without fresh food) Fresh Food Dry Grocery (Food) Home Improvement Hardware

13. © 2010 IBM Corporation Benefits of using GS1 Standards: 13

14. © 2010 IBM Corporation14 Example – Distribution Costs Industry Leaders 1 5 6 10 Number of standards implemented 1% 50% 51% 100% Average implementation level of standards implemented Distribution costs: 11.4% Distribution costs: 6.5% - 43% Industry Leaders, companies which have implemented at least 6 standards at an average implementation level of above 50% - manufacturer as well as retailer & wholesaler - profit from reduced distribution costs.

15. © 2010 IBM Corporation15 Reduction by - 52% Reduction by - 5.8% Example – Out-of-Stocks The use of SSCC positively affects the Out-of-stocks rate at the POS, which can be considerably reduced.

16. © 2010 IBM Corporation16 The use of SSCC or EDI for orders positively affects the Out-of-stocks rate at the POS, which can be considerably reduced Customer Satisfaction Reduction by - 4% Reduction by - 5.8%

17. © 2010 IBM Corporation17 Companies utilizing SSCC or EDI for orders show significant improvement for the store service level/fill rate Efficiency Increase +5.9% Increase +3,7%

18. © 2010 IBM Corporation18 Companies using GTIN on consumer units level on a higher implementation level gain advantage by an increased supplier service level Efficiency Increase +2.7%

19. © 2010 IBM Corporation19 Companies who have EDI for invoices implemented on a level above 50% could improve invoice accuracy and save your company, as invoice accuracy does not only cause administrative costs, diminish customer loyalty but also delay in payment Improved Quality Improved accuracy by +1.5%

20. © 2010 IBM Corporation20 Utilizing EDI for orders or GTIN on cases/cartons/inners level makes companies profit by lower distribution costs; distribution costs are one of the largest cost components in the company and therefore play an extremely important role Sustainability Reduction by – 4.6% Reduction by – 4.7%

21. © 2010 IBM Corporation21 The order to delivery cycle time could be extensively reduced when companies have GTIN on case/cartons/inners level implemented; lead time is one decisive fact for your customers signing the contract or seeing the our competitor Sustainability Reduction by - 61h

22. © 2010 IBM Corporation The More, the Better! 22 The more companies and GS1 MOs engage in the Global Scorecard, the more value companies internally, trading partners collaboratively, and the industry collectively will get out of this powerful system!