1. Document number Enrico Camerinelli- Sr. Analyst, Europe Efficient Supply Chain Management New Trends upon Supply Chain Management with Financial Perspective A member of the Oliver Wyman Group

2. 1 © 2008 Oliver Wyman  www.oliverwyman.com Supply Chain Management What is Supply Chain Management?

3. 2 © 2008 Oliver Wyman  www.oliverwyman.com SCM_ The Operational perspective Manufacturing Distribution X-Dock/ Retail DC Sales Channel Component Assembly Material Suppliers International Transport Outbound Trans Client

4. 3 © 2008 Oliver Wyman  www.oliverwyman.com Integration of the physical and financial supply chains Receive Goods and Invoice Send Payment Reconcile and Account Send Purchase Order Credit Application Negotiate Sales Terms Select Supplier and Goods Source Suppliers Supply Chain of the Buyer Receive Order Produce Goods Manage Inventory Distribute Goods Physical Supply Chain Supply Chain of the Seller Physical Supply Chain Source: SWIFT Eval uate Cre dit Rec onci le Sett le & Pay Issu e Invo ice For eca st Cas h Fina nce Wor king Cap ital Res olve Dis pute s Financial Supply Chain

5. 4 © 2008 Oliver Wyman  www.oliverwyman.com Why should all this matter to us? Answer: LIQUIDITY Why should this matter?

6. 5 © 2008 Oliver Wyman  www.oliverwyman.com Decomposing metrics

7. 6 © 2008 Oliver Wyman  www.oliverwyman.com Decomposing metrics CURRENT AFTER

8. 7 © 2008 Oliver Wyman  www.oliverwyman.com Decomposing metrics

9. 8 © 2008 Oliver Wyman  www.oliverwyman.com The challenge… …link physical activities with working capital ratios

10. 9 © 2008 Oliver Wyman  www.oliverwyman.com Performance Management SCM metrics impact on Income Statement Source: iCognitive

11. 10 © 2008 Oliver Wyman  www.oliverwyman.com Performance Management SCM metrics impact on Balance Sheet Source: iCognitive

12. 11 © 2008 Oliver Wyman  www.oliverwyman.com Tools SCM practices that impact Working Capital (freeing liquidity_ Real cases

13. PERFORMANCE REVIEW Note: Diagram only includes Supply Chain FunctionsNote: Example Figures

14. 13 © 2008 Oliver Wyman  www.oliverwyman.com Banks: Current state of art Financial Supply Chain - ABN AMRO JPMorgan Treasury Services introduces supply chain outsourcing service 06 August 2002 - 11:13 Supply chain business Deutsche Bank introduces financial supply chain management solutions in Asia May 24, 2007 Abbey and 0B10 in e-invoicing supply chain financing partnership Thursday, July 26, 2007 Supply Chain Management BNPP makes key Global Trade Services appointments

15. 14 Supplier Finance Solutions Supplier Finance Programs –With recourse structures: receivables’ financing –Without recourse structures: purchase of receivables Factoring –Financing of open account export receivables guaranteed by Yapı Kredi Factoring Credit Insurance by Euler Hermes –Financing of insured export receivables Forfaiting –For negotiable instruments

16. Document number Enrico Camerinelli ecamerinelli@celent.com +39.335.52.96.042

17. 16 © 2008 Oliver Wyman  www.oliverwyman.com Financing the extended supply chain: Automotive case study

18. 17 © 2008 Oliver Wyman  www.oliverwyman.com Agribusiness. 37.8 Bln USD