1. Is your business IPO ready ? Start here!
1. Make sure you have the right people on the bus in the right seats before you start…how do you know ? Read Jim Collins “Good to
Great” Level 5 leaders
2. Engage ALL the stakeholders, ask questions and listen…
3. Understand your numbers in detail (Use a Value Driver Model to help with this), benchmark your performance & measure the
theoretical gap. Then get the businesses to take ownership by doing “deep dives” into material gaps, understanding & verifying them,
then develop plan to close gap.
4. Set the bar high…make sure your staff are not afraid to fail… your leadership style is critical for this.
5. Understand the risks and develop mitigation strategies
6. Synthesize your story/Strategy and communicate it to ALL. Make sure ALL the stakeholders understand the “size of the prize” or
“how close the precipice is”…ensure they all share in the success
7. Instill Key Traits in your team for implementation;
1. Focus on what’s important – KPIs
2. Ensure there is Clear Accountability – Performance linked to incentive schemes and regular performance review
3. Discipline – You must have a Project Management Office (PMO) with leader with access to your ELT
4. Sense of Urgency (not impatience) – Daily, Weekly, Month Reporting
5. Persistence - never loose faith that you will prevail
8. You must have a closed loop “Planning & Performance” management process. This will help systematize the above traits.
9. Use the Pareto 80 / 20 approach to get low hanging fruit first
10. Use “Gilberts 6 windows on Human Performance” as a list of things you need to do to get your people performing

2. Stage 1
Listen &
ask questions
Identify potential
improvement
Sell Need for change
Stage 2
Deep Dive Reviews
Benchmark &
Re-engineer
Processes
Develop
Actions
Stage 3
Synthesize
& Implement
It starts and ends with having a credible story that hangs together?
Forget the final presentations which are easy, get these “Building Blocks”
right which will give your story credibility.
2
Business
Performance
Review
SYNTHESIZE, SIGN OFF. SYNDICATE, IMPLEMENT & MONITOR ACHIEVEMENT OF PLAN
Stewardship Review &
Control Processes
Employee
Survey
Top 20 Leadership
Interviews & Capability
Review
Behavioral
change plan
developed
External
Customer
Survey
KEY GAP “Deep Dives” TO SUPPORT TARGETS WITH ACTIONS
OHS & E Process
Manufacturing
Excellence
Capability
Work
Cap.
Mgt
Spend
Control
S&OP Management
IT Systems
Capability
Internal. Customer
Surveys by Dept
Governance
Framework, Policy
& Process
Standards
Risk
Review
Recruitment,
Training,
Development &
Retention
effectiveness
Customer Service
Excellence
Understand Strategy & Review Structure Alignment
Cash &
Debt
Mgt
Synthesize the critical reasons for change into a Story & Syndicate across/down the organisation to all stakeholders
Product &
Market
Development
Process
Sales
Capability
Supplier Transactional
Process Efficiency
Procure to Pay
Customer Transactional
Process Efficiency
Order to Fulfillment
Employee Transactional
Process Efficiency
Payroll & Expense
Reimbursement
Planning & Performance
Management Process
Margin / Pricing
Management Process
Develop Value Driver Model & Theoretical Improvement Potential

3. 3
Stage 1 – Building Blocks & Objectives
 Understand Strategy & Review Structure Alignment - Understand existing strategy (Shareholder
perceptions / expectations) & review alignment of organisation structure
 Top Leadership Review - Understand ideas (SWOT) & leadership capability for each of the senior
managers and high potential employee’s – “Are the right people on the bus in the right seats”
 Internal Customer Surveys - Understand how each department is perceived by its internal
customers for both KRAs and Key Behaviors
 Business Performance Review - Understand current & forecast business performance. Develop
80/20 broad range of critical KPIs to quickly instill focus, accountability & sense of urgency
 Risk Review - Understand the key business risks, their potential impact, the mitigation strategies
& probability before & after mitigation
 External Customer Survey - Understand the customer perceptions of our value proposition &
business performance (& our SWOT)
 Employee Survey - Understand the Employee perceptions of the business performance (& SWOT)
& their own performance
 Value driver model - Develop a “Theoretical Potential Improvement “ in the business by Developing
a Value Driver model and benchmark all its components against best practice and measure gap,
 Synthesize Story & Syndicate - Ensure everyone in the business can see the prize or precipice so
they understand why we have to change

4. 4
Stage 2 – Building Blocks & Objectives
 Governance Framework, Policy & Process Standards - Ensure a governance framework is in place that
meets best practice & exceeds all listing requirements
 Behavioral Change Plan - From feedback, develop detailed behavioral change plan needed to meet all
stakeholder objectives (mission, values, targets, etc)
 Customer Service – Develop detailed plan to ensure the customer service is consistently competitive,
value enhancing & meeting our promise to the customer ?
 Stewardship Review & Control Processes - Verify Balance sheet values , identify any major write-
offs and/or control weakness with actionable plan
 Cash Management & Funding Process – Review adequacy of capital structure & funding facilities.
Implement a process ensuring CFO has day to day control of funding and all material cash outflows
 CAPEX & Discretionary Spend Process – Put process in place to ensure all CAPEX & Discretionary
Spend (Marcom, R&M, etc) is properly justified, approved, prioritised, controlled in timely manner
with post implementation review.
 Working Capital Management – Put process in place to control & optimize WC % to “Best Practise”
 Margin Management Review – Ensure Margin Management Performance & Processes are “Best
Practise”. Identify margin improvement potential & process changes.
 Planning & Performance Management System - Ensure there is a process in place that drives ongoing
systematic improvement, provides clear accountability, focuses the business on things that are
important and creates a sense of urgency

5. 5
Stage 2 – Building Blocks & Objectives
 Supplier – Procure to Pay – Reengineer Process to be “Best Practice”
 Customer – Order to Fulfillment - Reengineer Process to be “Best Practice”
 Employee – Payroll & Exp Reimbursement - Reengineer Process to be “Best Practice”
 Sales Capability - Review Capability, Performance & Processes. Identify improvement opportunities
 Product & Market Development Process - Do we have an effective process & have we identified &
invested in a sufficient pipeline of growth opportunities to meet our growth targets ?
 IT / IS Systems Capability - Are these systems appropriate for our strategic & operational needs
and are they efficient and cost effective ?
 OHS&E - Reengineer Process to be “Best Practice”
 Manufacturing Capability - Reengineer Process to be “Best Practice”
 Supply Chain Management - Reengineer Process to be “Best Practice”
 People - Recruitment, Training, Development & Retention - Understand if performance shortfalls are
due to any systemic factor that can be corrected. Reengineer Process to be “Best Practice”
 Deep Dives - Turn “Theoretical Gap” into confirmed opportunities with management commitment and
detailed hard action plans

6. Strategy & Structure
5 Forces Review including
trends and scenario’s
SWOT Review
Competitor Review
Vision, Targets
Options & Rational
Key Actions
Key Enablers, Resources &
Risks
 Sponsor: CEO
 1 week timeframe
 Facilitated by CEO
 2 day workshop with Board & Leadership Team
Objective:
Understand existing strategy (and shareholder perceptions,
expectations) and alignment of structure
6

7. Top 20 Leadership
Review
Get all to read “Good to Great”
& prepare comments
Do 360 degree
Performance Reviews
List track record and key
achievements in last 10 years
One on One
Interview with CEO
Competency Gaps &
progression potential Finalised
Development Plans completed
and implemented started
 Sponsor: CEO
 6 week timeframe
 Facilitated by External HR Consultant
 CEO to identify review participants
 CEO to prepare plan on what changes will be made
Objective:
Understand ideas (SWOT) & leadership capability for each of
the senior managers and high potential employee’s – “Are the
right people on the bus in the right seats”
7
Level 5 Related Skills and Attributes
•Self Management
•Goal Achievement
•Results Orientation
•Interpersonal Skills
•Diplomacy and Tact
•Personal Accountability
•Influencing Others
•Developing Others
•Flexibility
•Versatility
•Teamwork
•Decision Making
•Resiliency
•Self Starting
•Accountability for Others
•Continuous Learning
•Conceptual Thinking
•Empathetic Outlook
•Leading Others
•Customer Focus
•Objective Listening
Level 5 Related Values and Motivators
Learning Leading Results
The value of pursuit of
knowledge, continuous
improvement of self and
the organization.
The value of personal
recognition and control
over their own destiny and
others.
The value of practical
achievements, ROI, on time
achievement, energy and
resources.
Level 5 Related Behavioral Styles
Consistency Influence Controlling
Predictable, steady,
composed. Steadiness
supports the hedgehog
concept.
Level 5s are not inherently
charismatic. They tend to
be compassionate, amiable,
objective and logical.
Levels 5s are not
domineering or highly
driven. They are inclined to
be purposeful, moderate
and conservative.

8. Employee Survey
20% of employees interviewed
by external facilitator
All employees do
questionnaire compiled by
external consultant
Present findings
Redo every year to measure
trend
 Sponsor: CEO
 4 week timeframe
 Facilitated by External HR Consultant
 Employee questionnaires… example questions;
 Summarise your CV
 What are your Goals
 Rate your Job Satisfaction
 KRAs – describe your performance
 What are your strengths
 What do you need from company to perform better
 What do you like about culture that must be retained
 What do we need to improve about the culture
 How can we improve the performance of the
department
 How can we improve the business performance
 Redo in 12 months times to measure change
Objective:
Understand the Employee perceptions of the business performance
(& SWOT) & their own performance
8

9. 13
Behaviours & Soft Skills - Our Customers (Presidents) Perceptions – Big Improvement
Internal Customer
Surveys
KRA’s
Behavior / Soft Skills
 Sponsor: CEO
 4 week timeframe
 Facilitated by VP HR
 For all Functional areas; Finance, IT, HR, Procurement, CS,
Logistics, SCM, Manufacturing, OHS & E, S& M
 Redo in 12 months to measure change
Objective:
Understand how each department is perceived by its internal customers
for both KRAs and Key Behaviors
14
KRA’s - Our Customers Perceptions - Still some upside, but improving
9
EXAMPLEEXAMPLE
EXAMPLEEXAMPLE

10. Business Performance
Review
OHS&E
Financials
Market
Operations
 Sponsor: CFO
 2 week timeframe
 Facilitated by CFO
 One week preparation inputting 5 year history and
forecasts
 1 day workshop presenting to Management Team to
review performance. Agree on initial 80/20 KPIs
 Design & implement daily, weekly reporting
(see example in Appendix 1)
Objective:
Understand current & forecast business performance. Develop
initial 80/20 broad range of critical KPIs to quickly instill focus,
accountability & sense of urgency
10

11. Risk Review
Brainstorm Key Risks
Select Top 10 Risks
Agree on Potential impact
(develop models)
Potential Mitigation Strategies
Probability before & after
If risk & impact still too high
develop more mitigation
11
 Sponsor: CFO
 1 week timeframe
 Facilitated by External
consultant
 2 day workshop with Board
& Leadership Team
 Ensure they are
incorporated into ongoing
monthly reporting so that
mitigation efforts are
progressed
Objective:
Understand the key business risks, their potential impact, the
mitigation strategies & probability before & after mitigation

12.  Sponsor: VP S&M
 8 week timeframe
 Facilitated by Market Research Consultant
 Customer questionnaires. … example questions;
 Rate our performance levels relative to competitors
 Rate our behaviors relative to competitors
 What are our biggest threats
 What are our biggest opportunities
 How can we help your business
 Redo in 12 months times to measure change
Objective:
Understand the customer perceptions of our value proposition &
business performance (& our SWOT)
12
External Customer
Survey
20% of customers interviewed
by external facilitator
All customers asked do
questionnaire compiled by
external consultant
Present findings
Redo every year to measure
trend

13. Value Driver Model
Develop Draft Conceptual
Models
Populate models with data
Benchmark model components
to best practice
Identify High Level gaps with
targeted performance
 Sponsor: CFO
 8 week timeframe
 Facilitated by Consultant
 Prepare draft conceptual model
(see example in Appendix 2)
 1 day initial workshop with commercial team &
management reviewing/ explaining model concept and
data requirements
 Four week preparation inputting & verifying 5 year
history and forecasts
 Three weeks for benchmarking components
 1 day workshop presenting to Management Team to
review performance and see major targeted performance
gaps (see example in Appendix 3)
Objective:
Develop a “Theoretical Potential Improvement “ in the business by
Developing a Value Driver model and benchmark all its components
against best practice and measure gap,
13

14. Objective:
Ensure a governance framework is in place that meets best
practice & exceeds all listing requirements
 Sponsor: Chairman
 One week timeframe
 Facilitated by CFO & Auditor
 Listing & Regulatory governance requirements
 Examples of “Best Practice” governance
policies at other companies
 CFO to provide example of DOA for review
 CFO to provide example of Planning & Control
Framework (See Appendix 4)
 Two Day workshop attended by
 ALL Board members
 All ELT members
 Facilitator
 Conduct workshops to communicate all policies
across all employees run by VP HR
14
Governance Framework
Mission & Values
Delegation of Authorities
Compliance & Audit
Code of Conduct
Planning & Control
Syndicate

15. Behavioral
Change Plan
Review Stage 1 feedback from
stakeholders
Identify behavioral barriers to
achieve objectives
Identify solutions to remove
barriers
Develop action plan to
implement
Communicate to stakeholders
 Sponsor: CEO
 8 week timeframe
 Appoint external Consultant to Facilitate
15
13
Behaviours & Soft Skills - Our Customers (Presidents) Perceptions – Big Improvement
EXAMPLEEXAMPLE
Objective:
From feedback, develop detailed behavioral change plan needed to
meet all stakeholder objectives (mission, values, targets, etc)

16. Recruitment, Training,
Develop. & Retention
Effectiveness
Is there clear Directional Info.
(PD,KRAs,Targets) ?
Does the person have
sufficient Resources or Tools
to do the job ?
Are rewards competitive,
performance reviews effective &
sufficient recognition given ?
Are there training and
development plans ?
Do the employees have the
capacity to do their role ?
Are they motivated… a good fit
or enjoyable workplace
environment ?
 Sponsor: VP HR
 8 week timeframe
 Appoint External HR Consultant to Facilitate
 Use Gilberts 6 window model to determine process issues
Objective:
Understand if performance shortfalls are due to any systemic
factor that can be corrected
16

17. Stewardship Review
& Control Processes
Prepare templates
Undertake
Stewardship Review
Management signoff of findings
& action plan
Management process in place
to ensure gaps are closed
Implement Actions
 Sponsor: CFO
 3 week timeframe
 Facilitated by CFO & Auditor – Template provided by
CFO & signed off by Auditor
 Three weeks to fill in template by accounting team
with all supporting schedules
 2 day review with finance team facilitated by CFO &
Auditor with output being actionable issue list
17
Objective:
Verify Balance sheet values , identify any major write-offs and/or
control weakness with actionable plan

18. Cash Management &
Funding Process
Appoint Regional Cash
Management Bank
Design & Implement online
payment process
Review Capital structure,
facilities
Develop & implement
centralized funding
arrangements, align DOA
 Sponsor: CFO
 8 week timeframe including implementation
 Facilitated by Treasurer
 2 day workshop designing online payment process led
by Treasurer & Bank
 Review Capital structure, facilities and WAC
 Gain approval for changes from CEO & Board
Objective:
Review adequacy of capital structure & funding facilities.
Implement a process ensuring CFO has day to day control of
funding and all material cash outflows
18

19. CAPEX & Discretionary
Spend Control Process
Justification Templates &
Models
Approval Review
Ranking Process
Implementation Control
Post Implementation
Review
Communicate across
organisation
Review DOA
spend limits
 Sponsor: CFO
 8 Week Timeframe
 Appoint facilitator
 2 day workshop to review and test process
 Process signed off by ELT
 Communication Workshops across all relevant people
run by CFO
Objective:
Put process in place to ensure all CAPEX & Discretionary Spend
(Marcom, R&M, etc) is properly justified, approved, prioritised,
controlled in timely manner with post implementation review.
19

20. Working Capital
Management
Set targets after understanding Value
Proposition WC terms & benchmark its
competitiveness
Minimize payment runs
to one per month
Make Sales Dept responsible for
collection & set weekly collection
targets
Clear Credit Limit, stop credit and legal
proceeding rules enforced by Finance
Implement Weekly Cash & WC
Forecast / Control process
Cost VP WC Terms into CPP margin
numbers
Monthly Sales & Operation Planning
meeting to optimize DOI
Objective:
Put process in place to control & optimize WC % to “Best Practise”
 Sponsor: CFO
 8 week timeframe
 Appoint facilitator
20

21. Margin Management
Review
Margin Calculation Definition
& Costing Methodology
Pricing Process
& DOA Compliance
Cost Plus v Market Based
Discount & Rebate Structure
CPP Matrix Analysis
(Variation)
Reporting
 Sponsor: CFO
 8 week timeframe
 Appoint Consultant to Facilitate (PCM ?)
 Understand margins
 Pricing policies and processes
 Costing policies and processes
 Explain variations
 Identify total improvement potential for margins
 Identify gaps to “Best Practice” & agree on process changes
Objective:
Ensure Margin Management Performance & Processes are “Best
Practise”. Identify margin improvement potential & process changes.
21

22. Supplier
Procure to Pay
Identify Best Practice
Map “AS IS” process
Document Gaps to “Best Practice”
Understand Risk/cost/resources
to close gap
Develop longer term plan for
delivering last 20%
Develop 80 / 20 strategy for quick
implementation
Objective:
Reengineer Process to be “Best Practice”
 Sponsor: CFO
 8 week timeframe
 Facilitated by Consultant, FC & VP IS/IT
22

23. Customer
Order to Fullfillment
Identify Best Practice
Map “AS IS” process
Document Gaps to “Best Practice”
Understand Risk/cost/resources
to close gap
Develop longer term plan for
delivering last 20%
Develop 80 / 20 strategy for quick
implementation
Objective:
Reengineer Process to be “Best Practice”
 Sponsor: CFO
 8 week timeframe
 Facilitated by Consultant, FC & VP S&M
23

24. Employee Payroll &
Exp. Reimbursement
Identify Best Practice
Map “AS IS” process
Document Gaps to “Best Practice”
Understand Risk/cost/resources
to close gap
Develop longer term plan for
delivering last 20%
Develop 80 / 20 strategy for quick
implementation
Objective:
Reengineer Process to be “Best Practice”
 Sponsor: CFO
 8 week timeframe
 Facilitated by Consultant, FC & VP IS/IT
24

25. Sales Capability
Value Proposition
Competitiveness
Project Pipeline & Market
Intelligence Data Systems
4P Effectiveness (Marcom) &
Sales Incentives
Customer & Channel
Relationship & Selling Skills
CPP Matrix Analysis
(Variation) & Reporting
Bid Quality
& Turnaround Times
 Sponsor: VP Sales & Marketing
 8 week Timeframe
 Appoint Consultant to Facilitate
 KPIs compared;
 Segment analysis – Quantity. margin p/t, MS%
 Value Proposition – lead time, quality, Terms
 Spend on Marcom, # of people, people cost
Objective:
Review Capability, Performance & Processes. Identify
improvement opportunities
25

26. Product & Market
Development Process
New
Channels
New
Products / Services
Expand Up / Down
Value Chain
New
Segments
M & A opportunities
Geographic Footprint
Expansion / Coverage
 Sponsor: VP Sales & Marketing
 8 week Timeframe
 Facilitated by External Consultant
 With conservative development success, is there sufficient
projects in the long term pipeline to meet growth targets ?
 KPIs compared;
 Time to Market
 New Channel
 New Segment
 New Product
 New Geographic Location
 % Projects on / ahead of target
 3,5 Year Forecast Gap to Target
Objective: Do we have an effective process & Have we
identified & invested in a sufficient pipeline of growth opportunities
to meet our growth targets ?
26

27. IS / IT Systems
Capability
Measurement KPIs
Competitiveness
of IS system
Age of Infrastructure
Outsourcing Options
Skills & Experience
Technology as enabler of
growth
 Sponsor: CFO
 8 week timeframe
 Appoint external IS/IT Consultant to Facilitate
 Do we have sufficient measurement systems ie KPIs =
downtime, Support costs, Development Costs, Coms Costs ,
manual and legacy systems
 Along with pareto analysis , reason codes for all problems
 Do we know “Best Practice” performance and process ?
Objective:
Are these systems appropriate for our needs and are they
efficient and cost effective ?
27

28. Customer Service
Excellence
Measurement of KPIs
(Lead Time, Stock Outs, $DOI,
DIFOT%, distribution costs)
Benchmark & Pareto
Performance Gap
Competitiveness of Value
Proposition
Quality Process
On Time Process
 Sponsor: VP Operations
 8 week timeframe
 Appoint external Consultant to Facilitate
 Do we have sufficient measurement systems ie KPIs =
Customer complaints & Returns, DIFOT%, Customer
Loyalty - % of their spend, premium over Next Best
Alternative
 Along with pareto analysis , reason codes for all problems
 Do we know “Best Practice” performance and process ?
28
Objective:
Develop detailed plan to ensure the customer service is consistently
competitive, value enhancing & meeting our promise to the customer ?

29. OHS & E
Process
Does the leadership put
OHS & E as #1 priority ?
Have we implemented
mitigating strategies for all High
Impact risks / activities ?
Do we measure incident
pyramid ?
Do 100% of employees conduct
and questioned in regular audits
?
Are all issues raised in Audits
closed out in a timely matter
Is there regular and sufficient
training given ?
 Sponsor: VP Operations
 8 week timeframe
 Appoint External OHS & E Consultant to Facilitate
 If we don’t know what is “Best Practice” then we need to
find out… eg BHPSTEEL in 1995 sort advice from leader
DUPONT
Objective:
Are the OHS & E processes and performance at “Best Practice”
levels
29
X

30. Manufacturing
Excellence Capability
Measurement
Fit for purpose Raw Materials &
efficient utilization & batch size
Appropriate Equipment
(quality and efficiency)
Repairs & Maintenance
Skills & Experience
Production Planning Process &
Product Complexity
 Sponsor: VP Operations
 8 week timeframe
 Appoint external manufacturing Consultant to Facilitate
 Do we have sufficient measurement systems ie KPIs =
downtime, Yield Loss, Throughput, Material Usage
Variance, Variable costs, Fixed costs
 Along with pareto analysis , reason codes for all problems
 Do we know “Best Practice” performance and process ?
Objective:
Are the Manufacturing processes and performance at “Best
Practice” levels
30

31. Supply Chain
Management
Procurement
Warehousing & Stock
Management
Distribution
Forecast Accuracy
Outsourcing
Production Planning Process &
Product Complexity
 Sponsor: VP Operations
 8 week timeframe
 Appoint external manufacturing Consultant to Facilitate
 Do we have sufficient measurement systems ie KPIs =
Procurement cost, Stock Outs, $DOI, Distribution Costs
 Along with pareto analysis , reason codes for all problems
 Do we know “Best Practice” performance and process ?
 Monthly Sales and Operations Planning Meeting
Objective:
Are these processes and performance at “Best Practice” levels
31

32. Planning & Performance Process
Strategy,
Value Driver Model,
benchmark &
5Year targets
Actions to Close Gap
& 1 year budget
Integrate with
individual STI targetsKPI Reporting Daily,
Weekly, Monthly
Corrective Actions
One on One
Performance
Reviews
Objective:
Ensure there is a process in place that drives ongoing systematic
improvement, provides clear accountability, focuses the business on
things that are important and creates a sense of urgency
Planning & Performance
Management Process
Strategy , benchmark & 5 year plans
Action Plans
to close gap along with 1 year budget
Integrate with Individual STI targets
Monitor Performance
Daily, Weekly, Monthly
KPI Reporting
Take Corrective Actions
to close gaps
Undertake
Individual Performance
Reviews
 Sponsor: CFO
 8 week timeframe
 Facilitated by External Consultant
 See example in Appendix 5
32

33. Performance Gap
“Deep Dives”
Identify items that make up at
least 90% of Gap
Undertake “Deep Dives” for
these items with “Best”
Understand why, & develop
plan for closure of gap
Reviewed & Signed off by CFO
 Sponsor: CFO
 8 week timeframe
 Facilitated by
 See example “Deep Dive” in Appendix 6
Objective:
Turn “Theoretical Gap” into confirmed opportunities with management
commitment and detailed hard action plans
33

34. Synthesize Story &
Syndicate
Objective:
Ensure everyone in the business can see the prize or precipice so they
understand why we have to change
34
 Sponsor: CEO
 1 week timeframe
 Facilitated by CEO &
ELT

35. APPENDIX
35

36. 7
Example – Stage B
Simple Value Driver
Model
Revenue p/t.
Raw Material costs per Input Tonne.
% Yield.
Raw Material costs p/t
Distribution Out costs p/t.
Material Spread p/t
Electricity cost per kwh.
# Kwh p/t.
Electricity cost p/t
Gas cost per MBTU.
MBTU p/t.
Gas cost p/t
Commissions/Royalties.
Packaging.
Consumables.
Environmental.
Other.
Other Variable Costs p/t
Variable Margin p/t
Line Speed - Lineal MPM.
Mix - M2 per tonne.
Scheduled & Unscheduled Maint..
Production Capacity
Forecast 5 year CAGR%.% Capacity Utilisation
Capacity Constrained
YOY % Growth.Market Size
% Marketshare .
Demand Constrained
Prime Tonnes Despatched
Variable Contribution
# Employees.
Payroll & Oncosts per employee.
Payroll & Oncosts
Motor Vehicles.
Coms & Computers.
Travel & Entertainment.
Marketing & Growth costs.
Repairs & Maint.
Premises cost.
Consultants.
Other.
Fixed Overhead
Life.Depreciation
Abnormals.
EBIT
* The value driver modeling was a technique I
learnt from Neil Sylvester (now Partner in PIP)
when he was engaged by Boral in the 1990s.
36
APPENDIX 1
EXA
M
PLE
EXA
M
PLE
DAILY (Email Template)
Good News - Wins
MTI, LTI, Enviro Incident, Fraud Incid
Resignations - Key Management
Bad News
Despatches
Unit Volume - Yesterday
Unit Volume - MTD % of Mth Fcst
Margin % - Act & Mth Fcst
Orders Received
Unit Volume - % of Mth Fcst
Margin % - Act & Mth Fcst
Cashflow - Act & Mth Fcst
Cash Position
WEEKLY KPIs. (Email Template)
Act Cashflow v 1 week Fcst
Fcst Cashflow Next Week
Act Sales Rev v 1 week Fcst
Fcst Sales Rev Next Week
Interco Payables Overdue
% Receivables Overdue
% Inventory Over 30 days
Inventory - % of Mth Fcst
DIFOT % - Act & Mth Fcst
MONTHLY ELT REVIEW AGENDA
Minutes of Last Meeting
Traffic Light Summary
OHS&E
C.S. - DIFOT % & Lead Time Days
PEOPLE - Behavioural Change Agenda
EBIT - Variance Analysis
Volume - Pipeline & Market
Margin Spread
Selling Price
Variable Costs
Costs & Efficiencies
Manufacturing
Logistics
S & M
Admin & Other
REVENUE - Variance Analysis
CASHFLOW - Variance Analysis
WC
Inventories
Receivables & Payables
Capex & Disposals
Project Progress Update
Risks & Opportunities
Agreed Actions & Checkout
ONE HOUR ALERT (Phone Call)
LTI
Environment Issue
Fraud
Reporting / KPI pipeline – Daily, Weekly, Monthly

37. 37
APPENDIX 2
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Value Driver Model

38. EXAMPLES OF EBIT IMPROVEMENT PROCESS
8
Example – Stage D - Benchmark Gap analysis
Column indented Item Names NZ & PI NSW QLD VIC & TAS BEST NZ & PI NSW QLD VIC & TAS NZ & PI NSW QLD VIC & TAS NZ & PI NSW QLD VIC & TAS
ROC% 4% -3% 7% 7% 17% 16% 14% 24%
Assets Employeed 195 125 123 152 4.0 150 101 101 100
Fixed Assets 150 100 100 100 150 100 100 100
Working Capital 38 20 19 47 0.0 (43) (23) (22) (51) (4) (3) (3) (4)
Working Capital Days 90 60 60 110 (10) (10) (10) (10) (10)
Inventory 25.6 9.9 12.8 25.6 0.0 13 0 3 13 12.8 10.7 9.6 12.8
Inventory Days 60 30 40 60 30 30 0 10 30 30 30 30 30
Receivables 21.4 16.4 12.8 29.9 0.0 13 10 6 21 8.5 7.1 6.4 8.5
Receivable Days 50 50 40 70 20 30 30 20 50 20 20 20 20
Payables 8.5 6.6 6.4 8.5 0.0 (17) (13) (13) (17) 25.6 21.4 19.2 25.6
Payable Days 20 20 20 20 60 (40) (40) (40) (40) 60 60 60 60
Other 7.0 5.0 4.0 5.0 4.0 (3) (1) 0 (1) 4 4 4 4
EBIT 8.3 (3.5) 9.0 10.9 (1.0) (17.5) (20.2) (6.5) (12.9) 25.4 16.2 14.6 23.8
Variable Contribution 33.9 22.6 29.6 39.9 0.0 43.4 36.2 32.6 43.4
Variable Margin p/t 282 226 328 333 362 (79.6) (136.0) (33.4) (29.1) (9.9) (14.1) (3.9) (3.5) 362 362 362 362
Material Spread p/t 340 292 375 382 395 (55.1) (103.7) (20.1) (13.8) (7.0) (10.9) (2.7) (1.7) 395 395 395 395
Revenue p/t 1,300 1,200 1,300 1,300 1,300 0.0 (100.0) 0.0 0.0 0.0 (10.0) 0.0 0.0 1,300 1,300 1,300 1,300
Raw Material costs p/t 960 908 925 918 905 55.1 3.7 20.1 13.8 6.6 0.4 1.8 1.7 905 905 905 905
Raw Material costs per Input Tonne 950 900 920 900 900 50 0 20 0 6.0 0.0 1.8 0.0 900 900 900 900
% Yield 99.0% 99.1% 99.5% 98.0% 99.5% -0.5% -0.4% 0.0% -1.5% 0.6 0.4 0.0 1.7 99.5% 99.5% 99.5% 99.5%
Distribution Out costs p/t 18.0 20.0 25.0 15.0 15.0 3 5 10 0 0.4 0.5 0.9 0.0 15.0 15.0 15.0 15.0
Other Variable Costs p/t 58.3 66.0 47.0 49.0 33.7 24.6 32.3 13.3 15.3 2.9 3.2 1.2 1.8 33.7 33.7 33.7 33.7
Electricity cost p/t 8.3 4.0 4.0 4.5 3.2 5.1 0.8 0.8 1.3 0.6 0.1 0.1 0.2 3.2 3.2 3.2 3.2
Electricity cost per kwh 0.15 0.10 0.08 0.10 0.08 0.07 0.02 0.00 0.02 0.08 0.08 0.08 0.08
# Kwh p/t 55.0 40.0 50.0 45.0 40.0 15 0 10 5 40.0 40.0 40.0 40.0
Gas cost p/t 20.0 21.0 9.0 12.5 7.5 12.5 13.5 1.5 5.0 1.5 1.4 0.1 0.6 7.5 7.5 7.5 7.5
Gas cost per MBTU 4.0 3.0 3.0 2.5 2.5 1.5 0.5 0.5 0.0 2.5 2.5 2.5 2.5
MBTU p/t 5.0 7.0 3.0 5.0 3.0 2.0 4.0 0.0 2.0 3.0 3.0 3.0 3.0
Commissions/Royalties 4.0 6.0 7.0 5.0 4.0 0.0 2.0 3.0 1.0 0.0 0.2 0.3 0.1 4.0 4.0 4.0 4.0
Packaging 8.0 15.0 12.0 10.0 8.0 0.0 7.0 4.0 2.0 0.0 0.7 0.4 0.2 8.0 8.0 8.0 8.0
Consumables 12.0 10.0 5.0 7.0 5.0 7.0 5.0 0.0 2.0 0.8 0.5 0.0 0.2 5.0 5.0 5.0 5.0
Environmental 3.0 5.0 5.0 5.0 3.0 0.0 2.0 2.0 2.0 0.0 0.2 0.2 0.2 3.0 3.0 3.0 3.0
Other 3.0 5.0 5.0 5.0 3.0 0.0 2.0 2.0 2.0 0.0 0.2 0.2 0.2 3.0 3.0 3.0 3.0
Prime Tonnes Despatched 120,000 100,000 90,000 120,000 120,000 100,000 90,000 120,000
Production Capacity 200,000 125,000 125,000 125,000 230,000 145,833 152,778 138,889
Line Speed - Lineal MPM 100 90 90 90 100 0 (10) (10) (10) 100 100 100 100
Mix - M2 per tonne 300 400 500 500 300 0 100 200 200 300 300 300 300
Scheduled & Unscheduled Maint. 20% 10% 15% 5% 5% 15% 5% 10% 0% 5% 5% 5% 5%
% Capacity Utilisation 60% 80% 72% 96% 52% 69% 59% 86%
Forecast 5 year CAGR% 3% 3% 5% 10% 3% 3% 5% 10%
Fixed Overhead 17.6 20.1 15.6 24.0 6.6 5.1 2.6 9.4 11.0 15.0 13.0 14.6
Payroll & Oncosts 7.5 10.0 10.0 14.4 1.5 0.0 2.0 4.8 6.0 10.0 8.0 9.6
# Employees 500 400 500 600 400 100 0 100 200 400 400 400 400
Payroll & Oncosts per employee 15,000 25,000 20,000 24,000 15,000 25,000 20,000 24,000 15,000 25,000 20,000 24,000
Motor Vehicles 1.0 1.2 0.8 0.7 0.7 0.3 0.5 0.1 0.0 0.7 0.7 0.7 0.7
Coms & Computers 0.6 0.5 0.8 1.0 0.5 0.1 0.0 0.3 0.5 0.5 0.5 0.5 0.5
Travel & Entertainment 1.0 0.5 0.7 1.0 0.5 0.5 0.0 0.2 0.5 0.5 0.5 0.5 0.5
Marketing & Growth costs 4.0 3.0 2.0 3.0 2.0 2.0 1.0 0.0 1.0 2.0 2.0 2.0 2.0
Repairs & Maint 1.5 1.3 0.5 2.0 0.5 1.0 0.8 0.0 1.5 0.5 0.5 0.5 0.5
Premises cost 0.5 0.6 0.3 0.4 0.3 0.2 0.3 0.0 0.1 0.3 0.3 0.3 0.3
Consultants 1.0 2.0 0.3 1.0 0.3 0.7 1.7 0.0 0.7 0.3 0.3 0.3 0.3
Other 0.5 1.0 0.2 0.5 0.2 0.3 0.8 0.0 0.3 0.2 0.2 0.2 0.2
Depreciation 6.0 5.0 4.0 4.0 0.0 1.0 0.0 0.0 6.0 4.0 4.0 4.0
Life 25.0 20.0 25.0 25.0 25.0 0.0 (5.0) 0.0 0.0 25 25 25 25
Abnormals 2.0 1.0 1.0 1.0 1.0 1.0 0.0 0.0 0.0 1.0 1.0 1.0 1.0
2009 PotentialGAP TO BEST - KPI2009 Financials GAP TO BEST - $m
38
APPENDIX 3
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39. MISSION VALUES COC & DOAVISION TARGETS
REPORTING
• Hourly Alert
• Daily – KPIs
• Weekly – Cash
• Monthly – BPR
• Qtrly – Forecasts
• Annual – Budget
• A
• B
• C
• D
• A
• B
• C
• D
SITE VISITS
• CEO Business Reviews
• CEO / CFO Major Capital Project Reviews
• CFO Stewardship & Commercial Reviews
• ELT Monthly Reviews
• Board Meetings
• External & Internal Audits
ELT GOVERNANCE FRAMEWORK
OTHER
• “Whistle Blower” System
• OHS & E Alert System
• Weekly Telecons – Cash
• COC & DOA Training Programs
• Values / Leadership Training Program
OCT
• Forecast
Review
JUL
• LY Review
FEB
• Capex & WC
AUG
• Behavioral
Change
MAR
• Deep Dive
Signoff
SEP
• OHS&E
APR
• Budget &
Risk Review
JAN
• Strategy &
Growth
MAY
• Stewardship &
Internal Audit
NOV
• Benchmark
JUN
• People &
KRAs
DEC
• CPP
ELT MONTHLY ONE DAY REVIEWS SPECIAL AGENDA (DEEP DIVES)
APPENDIX 4
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40. 40
APPENDIX 5
KPI: Owner: Target % Change:
Key Objective: EBIT Sensitivity 1% :
Performance: Target EBIT Impact:
Forecast % Change:
Forecast EBIT Impact:
10
Increase Uptime from average of 70% in 2006 to 83% in 2007
YTD Uptime is 2% below BUD (10% higher than LY). Expect to finish the year 1%
below BUD (12% higher than LY). YTD improvement is due to Uptime Project.
Month – worse than forecast: Due to Bottom Dross removal.
UPTIME % - MCL VP Manufacturing
YTD Downtime % - Pareto AnalysisYTD Downtime % - Pareto Analysis
STATUS COMMENTSSTATUSIMPACTWHOTOP 3 ACTIONS / PROJECTS TO DELIVER THIS QTR FORECASTREF.
UML3
UML2
UML1
On-trackMCL MgrBottom Dross Issue: Manage bottom dross growth until main pot replacement, by consistency
of schedule cleaning and implement of dross grab to removed mushy dross.
On-trackMCL MgrProcedure: Implement Reliability Workshop action plans
DoneMCL MgrEquipment: Replace MCL Welder control to give consistency of welding quality
On-trackMaint MgrJul’07Review potential local vendor for pot replacement.UML7
UML8
STATUS COMMENTSSTATUSIMPACTWHOWHENTOP 5 ACTIONS / PROJECTS TO IMPACT BEYOND THIS QTRREF.
On-trackMaint MgrOct’07Equipment : Placing PO and commitment for main pot replacement project.UML6
InitiatedMCL
Manager
Dec ’07Standardization process map resin areaUML5
UML4 InitiatedVP MfgOct ‘07Bottom dross issue: Ensure new pot design is capable of minimizing dross build-up
Trend – MonthTrend – MonthPerformancePerformance
13%
US$0.3m *
US$3.9m
12%
US$3.6m
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MONTHLY KPI REPORT – Situation, Reason, Action

41. EXAMPLES OF EBIT IMPROVEMENT PROCESS
9
Example - E - Deep Dive Summary on Material Benchmark Gap for Packaging cost per tonne
SBU - NSW
• Implementation Leader – Joe Brown (NSW Packaging Mgr)
• ARITHMETIC BENCHMARK GAP TO BE ANALYSED = A$700k
 Cost per Tonne = A$15 , Best A$8 ( SBU NZ )
 Annual Tonnes despatched by Company NSW = 100,000 , therefore A$7 p/t gap = A$700,000 p.a.
 Key reasons
 Different material type of packaging – impact A$200k p.a.
 Outsourcing used by NSW but in-house by NZ – impact A$400k p.a.
 Different labor rates between countries that two businesses operate – impact A$100k. The labor rate difference
cannot be closed as it reflects different market rates between the two countries..but will attempt to recover it in the
selling price to the customer (see spread analysis)
 Risks – Ensure NSW customers will accept NZ packaging
 Therefore Agreed Gap for targeted closure – A$600k
 Target implementation completion – Week 45
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APPENDIX 6
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