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Copyright © 2009 IHS Global Insight. All Rights Reserved.

IHS is The Source for Critical Information and Insight™ that powers growth and value for our clients. Products and solutions span four areas of critical information.

The Source for Critical Information

From design engineering to maintenance and disposition

From explorationto consumption

From risk assessment to supporting military operations

From material selection and management to hazardous waste disposal and emissions

Security

ProductLifecycle

Energy

Environment


About IHS

• In business since 1959, we are a leading global source of critical information and insight for customers in a broad range of industries

• Data and deep expertise from industry-specialized professionals enables innovative and successful decision-making

• Helping governments, and large multi-national companies to smaller companies, and technical professionals, in more than 180 countries

• 3,500 IHS colleagues in 22 countries

• Revenue $844 million at year-end 2008

• IHS customers include 35% of the United States Fortune 1000

• IHS customers include 60% of the Global Fortune 500


Why Customers Need IHS

Improve your strategic decisions

• Where to invest• How to invest• What return

Improve your technical decisions• How to manage project

benchmarks and success rates

• What technologies to deploy

• What are the cost structures and project economics

• What are technology best practices for similar assets

Insight• Breadth and depth of expertise• Quality of strategic research insight• Technical and operational capabilities

Information Products & Services• Breadth and depth of coverage• Data accuracy and expertise• Business process integration• Information access and visualization• Economic modeling

• Relationships with over 370 content providers & industry leaders worldwide


Core Offerings for Manufacturing

• Market Planning

• Cost Analysis & Forecasting

• Strategy Support

• Automotive Analysis

• Commodity Flow Analysis & Forecasting


Analytic Framework

• IHS has a standardized process that focuses on building internal alignment within our customers' organization around the validity of the forecast or planning tool. We build models that are transparent and fully understandable.


The IHS Global Insight Approach

Client Projects can include one or all of these steps – creating a continuum of service options.


How a Typical Consulting Engagement Works

Copyright © 2009 Global Insight, Inc. 8


Optimize Your Planning Process through Sales Benchmarking

…both in strategic planning and tactical management of your sales channels & resources.

Unbiased Replace assumptions with facts about business drivers

Precise Push the limits of available data into the market niches served by your company

Best PracticeCreate a logical, rational & consistent methodology for forecasts.

Understandable Everyone sees how the

forecast is derived.

The objective is Revenue & Margin Maximization…


Going Beyond the Trend Line

Identify factors driving demand & create multiple customized benchmarks based on these weights by:

Geography, Business Unit, Product Line, etc.

…a Custom Benchmark can Anticipate Market Trends.

Missed Market Growth from the Trend Line Approach…

Benchmark – Relevant to What?Benchmark – Relevant to What?


Sales Forecasting Models

Put it all together in a forecasting model that takes into account the full range of demand dynamics


Optimize Your Planning Process through Market Sizing/Segmentation

Identify market segments: geographic, demographics, business type, or industry

Measure individual market segments to create accurate sales forecasts and build

targeted sales & production strategies

Conduct what-if scenarios One market segment suddenly declines,

while another experiences an unexpected spike in orders—and

what to do about it


Market Sizing – “Squaring the Cube”

Available Data Array Integrated Data Array• Product, Geography, Customer (Industry)

Segments

• Link internal, client, & 3rd party data

• Public Company data

• Integrate the available market estimates and forecasts with other data

• Fill in the gaps through industry usage factor modeling

Geography

Product

Cu

sto

mer


Market Potential & Penetration

Bubble Size = 20102 Market Potential

Setting sales goals based on both

market potential and market penetration

provides a more realistic context for discussing

performance and expectations for

the future.



• Market Planning






Cost Analysis and Forecasting Consulting is tied to our Core Supply Chain Offerings

600

700

800

900

1000

1100

1200

1300

2006 2007 2008 2009

Sheet Steel Prices Exploded to New Records in 2008

(Cold Rolled Carbon Sheet, US$/metric tonne)Ask yourself…..

• What information am I currently using to monitor purchasing performance?

• What are my key commodity spends?

• What areas of my organization are in need of better price information?

• How do I currently benchmark purchasing performance?

• Do I fully understand what’s driving my supplier quotes and costs? Are their prices justified?

IGI calls for end of yearprice declines

Queensland Floods

Q – Should I lock in on soaring steel prices…..are additional increases ahead?

A – Market fundamentals indicated a sharp correction with minimal upside creep. Let contracts float.

This timely analysis saved a large energy client millions!

Bottom-line cost savings!

More effective supplier negotiations

Quantify market fundamentals & cost structures

Contrast regional and commodity discrepancies

Accurate cost estimation tools and data

Experts that help translate this to business needs


Provide actionable market intelligence to aid procurement professionals in quantifying the impact on their business

Forecast over 1200 global price, wage, and manufacturing costs and their associated drivers

Results lead to bottom-line cost savings

Addressing key needs for supply chain decisions

Quantifying sources of price change

Support for more effective supplier negotiations

Identifying relevant market benchmarks

Understanding market drivers and potential warning signs

Insights that Quantify Price Changes and Create Cost Savings


18

Unlike other forecasting or inflation providers, IHS Global Insight’s Pricing and

Purchasing model-based infrastructure provides guidance for more effective

price determination. This analysis enables purchasing executives and supply

chain professionals to quantify the sources of price change allowing for more

effective supplier negotiations that result in bottom-line savings.

Related consulting consists of special company benchmarking models, scenario

analysis, supplier assessment and market sizing which leverage the core

analysis and quantitative properties.

Key Value Proposition



• Market Planning






Strategy support is about impacting high quality, “big-bet” decisions

A good strategy is:

The set of specific decisions and policies

that specify the management actions

which, when implemented,

create the most long-term value.


What (and who) drives strategic support?

• Executive Level Decisions• CEO directional initiatives

• Underperformance of the company and / or several business units

• Change in the external environment creates major new threats or opportunities

• Business Unit / Regional Management Decisions• Asset Acquisition

• Need to prioritize investment among asset portfolio

• Business Case for more funding from corporate for its assets

• Other Key Personnel• Head Corporate Finance / BU Finance may have role in vetting the evaluation approach to

ensure consistency with internal valuation

• Functional Head / Leader can have a role in steering strategic effort, which may include the tactical perspective as well


Solving Problems through strategic support

22

Sample Problems Client expression of their problems

Poor choice / Lack of Alternatives

“I don’t feel that I have any real choice. My team comes to me with their preferred course of action, and a couple of obviously-poor alternatives.” “Our current path seems fraught with risk.”

Lack of Internal Alignment / Motivational Biases

"We produce our total available market estimates and forecasts, but when we then try to implement them, the geographic and industry segment leaders focus all their efforts on shooting holes in the numbers. It becomes a nightmare getting them to actually use them as benchmarks - especially when they conflict with their own individual beliefs."

Lack of strategic perspective “We took our product to the market as fast as we possibly could, well ahead of our competitors. What we did not know was that the market would become virtually extinct in 5 years.”

Ignoring uncertainties “We used our best guess estimate of the potential market size in planning our production capacity. However, we completely missed the possibility the demand explosion in Asia and missed a lot of value”


How do we define high quality decisions?

DecisionQuality

3. Meaningful, Reliable

Information

4. ClearValues andTrade-offs

5. Logically Correct

Reasoning

1.AppropriateFrame

2. Creative,Doable

Alternatives

6. Commitment

to Action

• Forward-looking assessment of the business

• Clarity of what decisions should be addressed

• Good strategic decisions require choices between alternatives

• Strategy will deliver value only if implemented

• Beware of biases• Seek “decision-

relevant” information • Clarify all important criteria for scoring alternatives

• Understand trade-off between alternatives across value metrics

• Consider risks explicitly

• Decision-focused evaluation: simple, but not simpler


Our strategy development process is a set of structured conversations with decision makers

WORKINGTEAM

1. ASSESSBusinessSituation

2. DEVELOPAlternatives,Information,and Values

3. EVALUATERisk andReturn of

Alternatives

5. PLANfor

Action

• Frame• Challenges

• Understanding

• Alternatives• Improved Information • Values

Decision

DECISION-MAKER(S)

APPROVECHARTER

AGREE TOALTERNATIVES

REFINEFOCUS

4. DECIDEAmong Alternatives

EvaluatedAlternatives


We can leverage internal IP broadly

Global Insight Economic Data

Decision Quality and Structured Decision

Dialogue Methodology

Global Insight Industry

Expertise

Ongoing Advisory Service

Research

Methodology

Client AddedValue


Information



Reasoning

6. Commitmentto Action

1. AppropriateFrame

2. Creative,Doable

Alternatives


Information



Reasoning

6. Commitmentto Action

1. AppropriateFrame

2. Creative,Doable

Alternatives

Decision -makers

Project Team

FrameFrame RecommendRecommendAlternativesAlternatives PlanPlan

RecognizeSituation

RecognizeSituation

ApproveFrame

ApproveFrame

ApproveAlternatives

ApproveAlternatives

ApprovePlan

ApprovePlan

DevelopAlternatives

AssessSituation

EvaluateAlternatives

Implement Decision

MakeDecisionDecideDecide

Decision Dialogue Process

Decision -makers

Project Team


RecognizeSituation

RecognizeSituation

ApproveFrame

ApproveFrame

ApproveAlternatives

ApproveAlternatives

ApprovePlan

ApprovePlan

DevelopAlternatives

AssessSituation


Implement Decision


Decision -makers

Project Team


RecognizeSituation

RecognizeSituation

ApproveFrame

ApproveFrame

ApproveAlternatives

ApproveAlternatives

ApprovePlan

ApprovePlan

DevelopAlternatives

AssessSituation


Implement Decision


Decision Dialogue Process

Expertise

Critical Information

ASIAN PHOENIXASIAN PHOENIX

BREAK POINTBREAK POINT

GLOBAL FISSURESGLOBAL FISSURES368 international location sets368 international location sets

Global Energy Scenario

Framework

IHS Tools and Databases


What is unique about our Strategy Support offering?

Our key differentiator:

• We have a unique decision focus to strategy development and offer a robust framework in making high quality decisions.

• We have a unique combination of technical and management consulting expertise to provide clients with efficient, robust strategy support.

Benefits to you:

• Identification of high value alternatives

• Understanding of the tradeoffs among alternatives

• Maintaining transparency in strategy process

• Better alignment among key stakeholders on recommendation

• Considering risks explicitly

• Outside-In perspective to de-bias and challenge the momentum

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• Market Planning






OVERALL BUSINESS ENVIRONMENT• Global economic, financial, risk—scenario analysis: 200+ countries• U.S. forecasts by country, metro, state; Canadian forecasts by province • Global demographic forecasts and analysis• Energy & materials prices and wage rates • Performance metrics for over 1,000 industries worldwide, e.g. global construction, agriculture• U.S. health benefits cost forecasts and analysis

A solid foundation of data, information & knowledge

ON-ROAD VEHICLEFORECASTING

• Global OEM LV Strategies• Global Light Vehicle Market Overview• World Light Truck• World Truck• U.S. Truck Trailers• Africa & Middle East• Asia• Central America & Caribbean• European Light Vehicle• Eastern Europe• NAFTA• South America

DATABASES• Production (Global)

– Country– Make– Model– Platform– Plant– Body style– Powertrain

Sales (Almost Global)– Country– Brand– Origin– Model– Body style– Trim-level & niche

(U.S.)

TECHNOLOGY RESEARCH• Component, system module supplier and technology share current/forecast, linked to vehicle volumes

• Antilock braking, auxiliary water pumps, body control modules, power closure systems, driveline, engine cooling, cooled EGR, front end modules, fuel coolers, HVAC, external mirrors, navigation systems & telematics, occupant safety, electrical parking brakes, power steering, powertrain, suspension, tires

• Electrical architecture

SUSTAINABILITY PROJECTS

Alternative fuels- Supply (agriculture)- Demand (fleet fuel demand)- Distribution

Future Powertrain Technologies

Driving The Future Forum- Global climate change,- Sustainable mobility

• Reports• Presentations • Workshops

Global Scenario Project- Framework-Auto- Energy- Aerospace

PLUS Same-day automotive and economic news perspective• OEM and supplier profiles• Micro-segmentation and other applications for OEMs• Expert presentations by senior personnel


Automotive Strategy Consulting Tri-fold - 1


Automotive Strategy Consulting Tri-fold - 2



• Market Planning





Copyright © 2009 IHS Global Insight. All Rights Reserved.323232

Commodity Flow Analysis & Forecasting

Overview: The commodity flow experts associated with the Commodity Flow Analysis & Forecasting (CFAF) offering have the unique ability to understand and predict global commodity flows. Our experts’ deep knowledge base, combined with our proprietary commodity flow databases, make us a critical element to strategic and tactical decision-making. CFAF presents an opportunity to expand your business, plan more accurately for contingencies, or lower costs. Our expertise will enable you to:

• Negotiate current shipping rates and anticipate future rates• Size, segment, and benchmark markets • Allocate sales, marketing, and fleet resources • Quantify the economic impacts of potential infrastructure investments• Optimize plant locations considering sources of raw materials AND

destination of finished product

Overview: The commodity flow experts associated with the Commodity Flow Analysis & Forecasting (CFAF) offering have the unique ability to understand and predict global commodity flows. Our experts’ deep knowledge base, combined with our proprietary commodity flow databases, make us a critical element to strategic and tactical decision-making. CFAF presents an opportunity to expand your business, plan more accurately for contingencies, or lower costs. Our expertise will enable you to:

• Negotiate current shipping rates and anticipate future rates• Size, segment, and benchmark markets • Allocate sales, marketing, and fleet resources • Quantify the economic impacts of potential infrastructure investments• Optimize plant locations considering sources of raw materials AND

destination of finished product



Value Proposition:

• Full understanding your needs is the cornerstone to our approach. We engage in open and ongoing discussions in order to achieve that objective. Solutions are then clearly and completely communicated. The IHS Global Insight team remains engaged following the completion of deliverables, to ensure that our services are utilized to the fullest extent.

• We are most effective when there is clear and open communication. We recognize that our clients are intelligent and know their markets well, and we value the insights that our clients share with us.

• We have extensive industry expertise:• Our experts have over 100 years of combined experience.

• We leverage unique, propriety data sets.

• We have the skill to join data and expertise:• Data without knowledge is not effective in solving problems. Our

experts can bridge the gap between pure data and important business decisions.



CFAF Proprietary Data:

• Transearch®: Our Transearch database provides U.S. county-level freight-movement data for more than 340 commodities and seven major modes of transportation, measured in value and volume. The database is accompanied by 30-year forecasts consistent with IHS Global Insight's macro forecasts.

• World Trade Service (WTS): WTS provides a comprehensive view of international trade markets and commodities. WTS includes trade between 54 countries and 16 world regions, 77 commodity groups and nine modes of transport, measured in value and volume. The database is accompanied by 20-year forecasts consistent with IHS Global Insight's macro forecasts.

• US Inland Trade Monitor (USITM): A third database that bridges Transearch and WTS is currently in development. When complete, USITM will enable a complete view of origin-to-destination commodity flows. We believe that this will be a key element that will enable the CFAF offering to penetrate the Manufacturing & Services Sector.


US Freight Flows: Imports


TRANSEARCH INSIGHT TRAFFIC LANE FLOW REPORT(Abbreviated Version)

Origin: Cobb County GA Destination: Buffalo NY

Code Commodity Total Rail Truck Air Water

0129 Fresh Fruits 133 0 106 27 0

2012 Meat 199 0 199 0 0

2643 Paper Bags 125 0 125 0 0

2812 Potassium 8,287 8,287 0 0 0

3522 Machinery 2,098 1,256 842 0 0

3714 Auto Parts 4.023 1,155 2,682 66 0

(cont’d. pg. 2-4)

TOTAL 26.073 12,645 13,290 138 0


Thank YouThank You

Christian SchenaDirector, Business Development

IHS Consulting(781) 301-9148

[email protected]

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