1. Building an Internet-driven global automotive company John Myers, Managing Director Strategic Business Systems Web: www.VehicleSystem.com eMail: jmyers@sbsusa.com

2. Agenda è Introduction è Launching a car company è The information backbone è Who’s connected? è Case studies è Future directions è Conclusions

3. Strategic Business Systems è Serves distribution operations of Motor Vehicle manufacturers è Vehicle Distribution, Warranty, Parts, & Dealer Communications è Customers include: Toyota, Saab, BMW, Peugeot, Kia Harley-Davidson, Ducati, KTM Hino Diesel, Land Rover, Hummer

4. Launching a car company è This includes entering new markets! è Business Strategy Product Positioning Budget Time to market è Information Technology (IT) Must support overall strategy!

5. IT Elements è Network Data / Voice è Software Operations / Finance è Servers è Support

6. Build vs Buy IT? è Build Just the way I like it Slow to market High budget è Buy Experience Fast to market Shared expenses

7. Build vs Buy IT? è The answer varies, depending on: Strategy Timing Budget è No overriding answers è The Internet opens many new doors

8. Internet information backbone A “buy” strategy

9. An “information backbone” è A way of connecting all individuals with all servers è Distance is not a factor è Different uses Communicate, report, buy, sell,... è Different applications Web, eMail, Terminal Access,...

10. Why use the Internet? è Budget Much less expensive than alternatives (including the costs of security) è Strategy Everyone is connected, everywhere è Timing Can get up NOW !

11. Applications Service Provider è With motor vehicle specialty è Has infrastructure already in place Internet connections Servers Software è Great concept for: small markets & budgets lean distribution model

12. Who’s connected?

13. Almost everyone, including: è Internal operations è Vendors è Dealers è Consumers

14. Barriers to progress Why isn’t everyone here?

15. Barriers to progress è Corporate “Inertia” è Politics è Sub-optimization è NOT MONEY!

16. Organizational change è NECESSARY TO ACHIEVE INTEGRATED SYSTEM è “Single point of TRUTH” !?!?!? è “Silo systems” come from SILO organizational structures

17. Integration must be planned è Integration comes in two ways Forced from the top Purchased from the outside è The Internet is another chance to obtain true integration of systems è Have the same system that manages the data serve it to the web

18. Example of planned integration è Warranty is the most integrative application (uses dealer, vehicle, part, & customer information) è Strategic Service/Warranty System built to use external data sources for all of the above information è Example: Harley-Davidson uses Strategic Warranty, but none of our other systems

19. Case studies

20. Qvale Automotive Group

21. è Licensee of the DeTomaso Mangusta è Very small vehicle sales volume è Global Strategy Headquarters in San Francisco, USA Manufacturing in Modena, Italy Dealers in Europe & USA

22. Qvale’s dilemma è Very small budget for IT è Desire to start now … difficult to reconstruct data later è What would you do?

23. Qvale’s IT plan è Use the Internet as a global communications backbone è Buy ERP software for manufacturing è Use an Application Service Provider for distribution systems Strategic Business Systems Vehicle Distribution, Warranty, Parts, & Dealer Communications

24. Qvale systems Web Dealer Communications System

37. Qvale systems Internal Operations System

44. Integration of these systems è All systems access same files Dealer Internal è All systems run over the Internet è All systems available everywhere

45. Implications for Qvale è Limited initial capital expense for vehicle, warranty, parts, & dealer communications systems è Proven systems NOW è Integration of USA & European product distribution efforts è Focus on product, not Information Technology

46. Future Directions New technologies, but a clear trend!

47. The Internet’s impact will continue to increase è New Internet technologies will lead to new choices è The Internet has made competing data communications technologies obsolete è Today’s youth view the Internet in the way their parents viewed Television

48. XML (Extensible Markup Language) è The next generation of “web” technology è Adds additional “intelligence” to web applications è Allows easy sharing of data between different types of computers è The basis for “next generation” Dealer Communications Systems

49. Conclusions

50. Smaller manufacturers can look “large”

51. Smaller markets are more practical to enter

52. Application Service Providers Offer new opportunities for ALL manufacturers

53. A return to IT centralization Language, culture, & laws are the constraints

54. Questions ??? John Myers, Managing Director Strategic Business Systems web: www.VehicleSystem.com eMail: jmyers@sbsusa.com