Value Proposition - CP Execute Digital Transformation PoV

This presentation from o9 Solutions provides a guide for Consumer Packaged Goods (CPG) companies on how to execute a successful digital transformation for business planning. It notes that 70% of such transformations fail due to common challenges like being never-ending projects, having poorly defined goals, and being unable to adapt to organizational changes.

To address these issues, the document introduces a framework based on four pillars that drive the health of a digital transformation:

- Brain (Technology): This is the foundation of the transformation. Success depends on building a flexible tech platform that converts data into actionable knowledge. The platform must be adaptable to changing business needs.
- Heart (Rhythm of Progress & Decision Making): This pillar represents the pace of progress and the ability to make effective decisions. Success involves delivering quick, tangible "value drops" to demonstrate progress and maintain team motivation. This shifts the focus of meetings from data alignment to decision-making.
- Muscles (Culture & Behavior): This refers to the people and behaviors that drive the transformation forward. A key success factor is involving the right people, or "Change-makers," such as knowledgeable product owners and coaches, to lead and support the change, thereby mitigating employee resistance.
- Bones (Processes): These are the structural elements that support the transformation. Success requires processes that can detect and mitigate risks, particularly the lack of user adoption and value realization. Allowing users to make their own "DIY" configurations can reduce resistance and increase flexibility.

The presentation includes several use cases and client examples to illustrate these principles, including a large beer company, a multinational footwear brand, and a major dairy company. It concludes by offering an assessment tool for companies to evaluate the health of their own digital transformation initiatives.

1. How to execute a successful planning Digital Transformation A guide for CPG companies

2. 70% of Digital Transformations fail.* 2 o9 Solutions, Inc. Confidential and Proprietary.  Any unauthorized use, reproduction or distribution is strictly prohibited. Failure modes Digital Transformations are never-ending projects. They aren’t designed to deliver value to the organization quickly enough Ultimate Success for transformation initiatives is poorly defined, leaving employees focused on tactical actions and checklists but losing sight of the bigger picture Organizations change constantly. Digital Transformation plans and solutions seem unable to keep up with organizational changes. It’s nearly impossible to implement design changes after the blueprinting stage Examples A Pilot of a new system or process remains contained within slices of the business; and scaling is hampered due to a lack of organizational commitment Fixing a single process (e.g., forecasting) or a single metric with little focus on process design After blueprinting there is an organizational change so planning needs to take place at a different level, but tech partners are unable execute these changes easily * https:// www.bcg.com /publications/2020/increasing-odds-of-success-in-digital-transformation Common challenges CPG companies face are around speed to value and managing constant change

3. Four pillars that drive the health of a CPG Digital Transformation 3 Technology is the brain of an organization’s Digital Transformation and is the foundation for all other driving forces. The rhythm of progress and d ecision-making is the heart of an organization’s Digital Transformation . This is twofold- firstly, organizations need a steady pace of progress in their Digital Transformation. Secondly, as a result of Digital Transformation, they should be able to make effective decisions at the optimal pace for their organization. Culture and behaviors are the organization's muscle. Organizations need the right behaviors and culture to act as the muscle that drives the organization forward in its Digital Transformation plans. Levels of employee support and engagement need to be constantly monitored and trained to ensure a Digital Transformation is not losing momentum.  Processes are the bones that keep a Digital Transformation standing upright . It’s OK if they turn out to be broken at some point during the Digital Transformation- the key is that an organization can detect if there is something wrong and adjust accordingly. o9 Solutions, Inc. Confidential and Proprietary.  Any unauthorized use, reproduction or distribution is strictly prohibited.

4. Applying the four pillars to ensure the health of a Digital Transformation to CPG business p lanning 4 o9 Solutions, Inc. Confidential and Proprietary.  Any unauthorized use, reproduction or distribution is strictly prohibited. Brain = Technology Heart = Rhythm of Progress & Decision Making Muscles = Culture & Behaviour Bones = Processes 1 2 3 4 Success factor Build a flexible tech platform that transforms data into knowledge. Fast value drops and increasingly effective decision making. Involve the right people (Change-makers) to lead and support the change Processes that detect and mitigate for Digital Transformation risks Description The tech platform organizations build should transform data into knowledge, driving decision making. Organizations change faster than ever before, and your Digital Transformation platform needs to be flexible to adapt to changing business needs. Quick early wins demonstrate that the transformation will deliver value. This also ensures teams stay motivated. Plan to deliver value as soon as possible even if it’s a small win. In the Medium-term, organizations should be able to make more effective decisions as the correct data should be readily available to all. Product owners with technology and process knowledge are needed to lead change and own the long-term vision. Coaches should be put into place at the relevant levels to drive Deployment and Adoption. Deployment teams must put in place processes that closely monitor adoption and value realization and can course-correct as necessary. DIY configurations should allow users to make the relevant changes without relying on convoluted processes or external parties forever.

5. Transforming dat a into knowledge to drive effective decision making 5 o9 Solutions, Inc. Confidential and Proprietary.  Any unauthorized use, reproduction or distribution is strictly prohibited. Digital Customer Engagement Consumers | Retails | B2B | ... Digital experience Partner experience E-Commerce In-store partner experience Digital Supplier Engagement Tier 1 | Tier 2 | CM | ... Supplier Knowledge Supply and Capacity Visibility Supply Risk Mitigation Reliable Commits Scale Digital Operations Automation DCs | Logistics | Service | ... Execution Visibility Capacity & Utilization Visibility Real Cost Visibility Inventory Visibility External Data Sources Public Data Web Scraping Image Processing Events Traditional Enterprise Systems ERP DW CRM … Human Knowledge Spreadsheets Tribal Knowledge Digital Product Transformation IOT | Sensors | Embedded Software | ... Real Time Product Usage Product Issues Track & Trace FINANCE REVENUE SUPPLY CHAIN MARKET KNOWLEDGE DEMAND KNOWLEDGE SUPPLY KNOWLEDGE Success Factor 1 : Build a flexible tech platform that transforms data into knowledge.

6. 6 o9 Solutions, Inc. Confidential and Proprietary.  Any unauthorized use, reproduction or distribution is strictly prohibited. o9's Enterprise Knowledge Graph Graph technology at its core is more flexible than existing solutions on the market. o9 can build a model and change the level it is built at due to this technology Models are also extensible, meaning changes like introducing new demand drivers or channels are easy Graph technology also means it is simple to change the core characteristics of the business and the relevant KPIs. For example, CPG companies can change linear business models into circular business models and integrate the key KPIs accordingly A large beer company introduced a r eference model driven collection of libraries for its p lanning t echnology roll-out These act as functional m odules that can be reused, added to, and deployed from one region to another This h igh reusability results in faster time to deployment. Especially for mid / small markets where no additional capabilities are required No significant additional capabilities for mid / small markets resulting in low-cost and quick deployments Reference Models CPG Global CPG China CPG US / Canada CPG Asia CPG Europe CPG Brazil CPG Mid & Small Client example Models One Region  Another Technology should be flexible and extensible to act as a force for good when managing complexities and parallel implementations Success Factor 1 : Build a flexible tech platform that transforms data into knowledge.

7. Use case: A large multinational beer manufacturer was able to quickly extend their new planning platform across geographies 7 o9 Solutions, Inc. Confidential and Proprietary.  Any unauthorized use, reproduction or distribution is strictly prohibited. 2019 2020 2021 2022 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Wave 1 4% of beer manufacturer vol. Wave 2 48% of beer manufacturer vol. Wave 3 31% of beer manufacturer vol. Wave 4 18% of beer manufacturer vol. MAZ and LAS: Demand Planning COE Timeline is indicated by technical go live (after SIT, UAT and training) Business go live will be 6-8 weeks (parallel run) after technical go live Integrated Supply Planning: SNP, MRP, Ret-Pack, Inventory Optimization, Inventory Deployment Integrated Demand Planning: Statistical Forecast, Commercial Collaboration and Enrichment, NPI Planning S&OP and Supply Chain Execution Analytics SNP, MRP, Ret-Pack, Inventory Optimization, Inventory Deployment Canada Western Europe China Brazil USA Western Europe Columbia Eastern Europe South Africa & Argentina: TBD Mexico o 9 Lite version for small countries to be piloted Success Factor 1 : Build a flexible tech platform that transforms data into knowledge.

8. One of the world’s largest beer companies went live with o9’s Demand Planning and Supply Planning capabilities across six significant markets within 18 months: Modules were easy to add to, and mid / small size markets could quickly adapt the components that suited their market (they didn’t have to adopt all components) This resulted in low-cost, quick deployments fueled by the reference model driven collection of libraries 8 o9 Solutions, Inc. Confidential and Proprietary.  Any unauthorized use, reproduction or distribution is strictly prohibited. Use case: A large multinational beer manufacturer was able to quickly extend their new planning platform across geographies Success Factor 1 : Build a flexible tech platform that transforms data into knowledge.

9. Use case: Fast value drops to demonstrate value and motivate teams 9 o9 Solutions, Inc. Confidential and Proprietary.  Any unauthorized use, reproduction or distribution is strictly prohibited. First v alue drop delivered in 8-12 weeks A multinational footwear brand launched an o9 forecast analytics pilot with one of its largest retail customers The new analytics tool was launched in 12 weeks, and it immediately improved the accuracy of sell-in and sell-out forecasts The improved forecasts led to an improved fill rate and an immediate impact on revenue 12 weeks later, the tool was rolled out to all customers in North America. The Planning teams were motivated and energized as a result of the fast value delivery o9’s AIM methodology breaks down Digital Transformation initiatives into building blocks. Each building block is a self-contained unit that drives tangible pre-defined business value. The first building block and value drop can be delivered in 8-12 weeks Definition of value drop: Technology implementation that drives tangible business value Q4 Q3 Q4 Q2 Q1 2021 2020 Contract signature Retailer go-live North America kick-off Success Factor 2 : Fast value drops and increasingly effective decision making.

10. An indicator of a successful Digital Transformation is when meetings become focused on decision making, not alignment 10 o9 Solutions, Inc. Confidential and Proprietary.  Any unauthorized use, reproduction or distribution is strictly prohibited. Less time should be spent crunching and aligning numbers across disparate systems, and the correct data should be readily available to all. Meetings should end up focused on decision making as opposed to alignment, since the data and potential scenarios in the system are clear to all. Eventually, the time spent in meetings should decrease. Team productivity case from a beverage company: Reduction of workload In minutes per week Demand planning Supply planning Automated Demand Sensing and Post Game Analysis Forecast Generation Initiative Panning and Account Promotion Planning Forecast Review Joint Business Planning Consensus Forecast Review / S&OP Meetings Total Control Tower Run Optimal D/S Match Scenarios Supplier/C ustomer Collaboration Analyze & Select Optimal Scenario Prepare Supply Review/Pre-MBR Demand Priorities/Inventory & Supply Chain Policies Total WL remaining WL reduction 567 376 54 945 21 84 300 75 95 220 575 1225 60 6 105 375 315 1800 135 45 180 690 414 276 720 432 288 216 144 135 45 60 90 858 1422 360 180 150 2280 Success Factor 2 : Fast value drops and increasingly effective decision making.

11. Use case: Change-makers — A large dairy company involved c oaches at the regional level for every relevant function and adoption is set to increase by 10% 11 o9 Solutions, Inc. Confidential and Proprietary.  Any unauthorized use, reproduction or distribution is strictly prohibited. Global Planning Capability Regional Planning Capability Center Regional Business Operations End Users Global Integrated Planning Project Manager DP SP DS MRP IBP Logistics 3PL Data & IT Project Managers Creative Team Communication and Engagement Executive Videos Monthly new capability updates Best practices Value communication Community of practice Global S o lutions Development Center Prototyping Extending Models Algorithm Development Regional Planning Coaches Capability, Adoption, Governance US EU TBD DP SP … DP SP … DP SP … Client example Success Factor 3 : Involve the right people (Change-makers) to lead and support the change.

12. Change-makers need to be involved at every level of governance driving deployment and a doption 12 o9 Solutions, Inc. Confidential and Proprietary.  Any unauthorized use, reproduction or distribution is strictly prohibited. Deployment team looks after PMO, value r ealization, adoption c oaches (communications, change and organization) and capability d evelopment (training). They should be working hand-in-hand with managers at every level to ensure all employees understand WIIFM (What’s in it for Me) of th e Digital Transformation. Product team works hand in hand with o9’s Agile Implementation Methodology and looks after the overall Platform for Next-Gen Planning, Data Governance, Data Engineering & Modeling, Analytics, Solution Design and Configuration. Deployment, process and product teams usually work in close collaboration with global teams looking after e.g. client X’s IT architecture, data platform strategy (e.g. Azure / GCP / AWS) and Analytics / Data Science teams. Most clients seek to develop an analytics (product) roadmap aligned to AIM releases, e.g., to further develop specific forecasting analytics for Demand Sensing or improve existing inventory analytics. Deployment Process and Op Model Product Program Leadership Global Program L ead IT Architecture Governance Analytics Data Platform High level program s tructure Regional (e.g. US / Asia / LATAM) Deployment Lead Market Lead Manage day-to-day execution and coordination with local team Design Authority Board Represent p roduct , p rocess and adoption together to make decisions about Market localization of the global template and/or escalate to Global Leads C D B A Success Factor 3 : Involve the right people (Change-makers) to lead and support the change.

13. Most Digital Transformations fail because of employee resistance 13 o9 Solutions, Inc. Confidential and Proprietary.  Any unauthorized use, reproduction or distribution is strictly prohibited. Successful Unsuccessful 14% 33% 39% 14% Employee resistance Management behavior doesn’t support change Inadequate budget or resources Other obstacles Factors contributing to failure No-code r eport generation High productivity due to no-code UI development which only requires simple configurations and drag & drops Easy report m anagement Changes made to the reports are reflected immediately Role-based authorization controls to the reports Business insight anywhere, anytime Innovation on demand Democratization of business i nsight Digital communication & collaboration Continuous improvements Example of easy to tailor UI/report configuration Line Simple Configuration Ensuring employees can tailor elements of technology without long approval processes reduces the likelihood of resistance Success Factor 4: Processes that detect and mitigate for Digital Transformation risks.

14. Use case: Users can make DIY configuration changes as needed, avoiding long chain of approval processes 14 o9 Solutions, Inc. Confidential and Proprietary.  Any unauthorized use, reproduction or distribution is strictly prohibited. Line DIY config ensures flexibility for the Planning Organization Companies are easily able to modify planning levels to accommodate re-organizations and acquisitions Prominent players in the CPG space face evolving market circumstances and often acquire new businesses A Food & Beverage industry leader found long-term success with o9 due to their ability to change the planning level as their markets, channels, and categories evolved DIY config ensures flexibility for Data Scientists CPG companies that set up Data scientists for success are winning in the marketplace For a leading Food & Beverage company enabling Data scientists to explore and add new datasets was essential to their continued success Data scientists have also found success with o9’s tournamenting functionality. This provides data scientists with the option to select a specific forecast based on different models available, meaning data scientists can choose the optimal model for the current situation Success Factor 4: Processes that detect and mitigate for Digital Transformation risks.

15. Processes that detect real transformation risks and adjust before roll-out is impacted 15 o9 Solutions, Inc. Confidential and Proprietary.  Any unauthorized use, reproduction or distribution is strictly prohibited. The most significant risk to an organization’s Digital Transformation is the lack of adoption/usage and implementing technology without realizing the necessary value Deployment teams must closely monitor adoption and value realization to avoid falling into this trap. The above sample processes should enable the identification of lower-than-expected adoption or value realization metrics Regular feedback sessions should also be taking place with users to understand the root causes of adoption and value realization KPIs. If an underlying risk is identified, organizations should have mitigation processes to course-correct following this user feedback Success Factor 4: Processes that detect and mitigate for Digital Transformation risks

16. Use our assessment to determine the health of your Digital Transformation 16 o9 Solutions, Inc. Confidential and Proprietary.  Any unauthorized use, reproduction or distribution is strictly prohibited. The four-step a ssessment is an easy-to-use framework for assessing the health of your Digital Transformation and identifying any areas of weakness. You can download it here . You can also feedback to our aim10x Community answers to these key questions: What are the most important lessons you have learned through your Digital Transformation journey? What have been your biggest Digital Transformation challenges? How have you learnt to capture value in a sustainable way?

17. 17 Thank you! o9 Solutions, Inc. Confidential and Proprietary.  Any unauthorized use, reproduction or distribution is strictly prohibited.