The crowd sourced analytics of the technology best in class

SIMMETHOD Crowd Competitive Intelligence, C-Level Analytics and Risk Alerts
AMAZON
Best In Class Or Laggard?
It all depends on the color of your metrics!
10/28/2014
1
WWW.SIMMETHOD.BLOGSPOT.COM

SIMMETHOD
C-level Risk And Opportunity Alerts
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The Market Has Opposing Views On Amazon
“Investors aren’t buying the Amazon fairy-tale anymore” reported Business Insider on 10/25/2014
“Part of Amazon.com’s core is dying” reported Paul Santos in Seeking Alpha
10/28/2014
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“Amazon Fire Sale: Down 7% on Q3 Miss. Q4 View: Two Downgrades, Price Targets Slashed” reported Barron’s on October 24
10/28/2014
4

“No One Wants To Hear Anything Good About Amazon, But…
“Break out Amazon’s tech revenues from merchandise sales and the stock is at industry multiples”
“This company is still growing at 20% per year and the stock is thus dirt-cheap” wrote Dana Blankenhorn on Seeking Alpha
10/28/2014
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2013 To 2014 Performance Trend
•How do The Barron’s 500 (2013 to 2014) trend compare to the SIMMETHOD Strategy & Execution Performance Predictive Index trend?
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2013 To 2014 Performance Trend
Name
Barron’s 500
SIMMETHOD Strategy & Execution Performance Predictive Index
eBay
↑
↑
Cognizant
↓
↑
IBM
↓
↓
Fidelity National Information
↓
↓
Amazon
↑
↓
Google
↑
↑
Priceline
↑
↑
Facebook
↓
↑
Microsoft
↑
↑
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Barron’s 500 Ranking Algorithm
•“Median three-year cash-flow-based ROI,
•One-year change in that measure relative to the three-year median and
•Adjusted sales growth in the last fiscal year”
10/28/2014
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SIMMETHOD and The Barron’s 500
There is a main reasons why The Barron’s 500 and the SIMMETHOD Index arrive to two different results such as in Amazon’s case:
•SIMMETHOD is a holistic (context based) risk & performance index covering a larger number of financial and operational metrics blended with crowd-sourced analytics relative to the Best In Class in a League Table
10/28/2014
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The Way We Measure Corporate Risk and Performance Is Broken
Why do Businesses fail or fail to perform?
Blockbuster
Borders
Circuit City
Mervyns
Wachovia Washington Mutual
Linen n’ Things
10/28/2014
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SIMMETHOD Strategy & Execution
Performance Predictive Index
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How to holistically
measure your
strategy & execution
and your
competitive
advantage?

The SIMMETHOD Algorithms and the 7 Laws of Growth and Value Creation
SIMMETHOD 7 Laws
Integration/alignment
Crowd analytics inside/outside your industry
Growth & value creation
Resource contribution to objectives C-level Predictive performance & risk
Averages & positive trends
Minimum company /business model
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SIMMETHOD
•SIMMETHOD’s Strategy & Execution Performance Predictive Index Business League Table
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SIMMETHOD’s Technology League Table Top 25% Vs. Bottom 25%
The top 25% of the SIMMETHOD Technology League Table on average
Delivers 3x more profit and
Creates 3x more value with
30% less sales
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To generate $1 of profit need to sell $4
To generate $1 of profit need to sell $19
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Every $1 of sales creates $5 of business value
Every $1 of sales creates $1.2 of business value
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SIMMETHOD Strategy and Execution Performance Predictive Index
•What is Amazon’s position within the 2014 SIMMETHOD Strategy & Execution Performance Predictive Index Business League Table?
10/28/2014
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SIMMETHOD’s C-Level Trends 2012-2014 Amazon and the Best-In-Class
The following C-Level indices show Amazon’s ability to:
•Strategize and execute against the SIMMETHOD Best-In-Class,
•Compete against the Best-In-Class, current and future competitors
and are leading indicators of future business opportunities, risk and performance.
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0
10
20
30
40
50
60
70
80
SIMMETHOD Management Controllable Resources Index
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-10
-5
0
5
10
15
20
25
30
35
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-30
-25
-20
-15
-10
-5
0 SIMMETHOD Management Controllable Resources Index
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SIMMETHOD’s crowd-sourced analytics and algorithms have placed Amazon’s Strategy & Execution Performance Predictive Index at the top of the 3rd quartile of the SIMMETHOD Technology Business League Table

-60
-50
-40
-30
-20
-10
0
AT&T
Atos
Thomas Cook
Adecco
Grupo Televisa
Fidelity National …
Computer Sciences
Sodexco
Verizon comm
American Express
Time Warner Cable
Compal Elecronics
HP
Expedia
Capgemini
Comcast
Liberty interactive
Telefonica
Verisk Analytics
Cablevision
Centurylink
Innolux
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SIMMETHOD
•SIMMETHOD Crowd-Sourced Competitive Intelligence Analytics
10/28/2014
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SIMMETHOD Crowd Competitive Intelligence
It shows your strengths and weaknesses at the enterprise (rather than the product) level and Your ability to compete with existing businesses and potential new competitors with new business models, cost structures, processes, distribution channels and products.
10/28/2014
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SIMMETHOD Competitive Intelligence Trend Vs. Peers And Best-In-Class
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25
-10
0
10
20
30
40
50
60
70
Average B-I-C SIMMETHOD Strategy & Execution Performance Predictive Index
Apple SIMMETHOD Strategy & Execution Performance Predictive index
Google SIMMETHOD Strategy & Execution Performance Predictive index
Microsoft SIMMETHOD Strategy & Execution Performance Predictive index
IBM SIMMETHOD Strategy & Execution Performance Predictive Index
Amazon SIMMETHOD Strategy & Execution Performance Predictive index
Yahoo SIMMETHOD Strategy & Execution Performance Predictive Index
2014
2013 2012
The crowd sourced analytics trend shows Amazon’s increasing risk vs. peers & B-I-C

10/28/2014
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-10
-5
0
5
10
15
20
25
30
35
40
45
Avg. B-I-C SIMMETHOD Management Controllable Resources Index
Apple SIMMETHOD Management Controllable Resources index
Google SIMMETHOD Management Controllable Resources index
Microsoft SIMMETHOD Management Controllable Resources index
IBM SIMMETHOD Management Controllable Resources Index
Amazon SIMMETHOD Management Controllable Resources Index
Yahoo SIMMETHOD Management Controllable Resources Index 2014
2013
2012 SIMMETHOD’s crowd analytics shows that Amazon is not leveraging resources at B-I-C level and the trend is negative

10/28/2014
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-5
0 5
10
15
20
25
30
Avg. B-I-C SIMMETHOD Value Creation Index
Apple SIMMETHOD Value Creation Index
Google SIMMETHOD Value Creation Index
Microsoft SIMMETHOD Value Creation Index
IBM SIMMETHOD Value Creation Index
Amazon SIMMETHOD Value Creation Index
Yahoo SIMMETHOD Value Creation Index
2014
2013 2012 SIMMETHOD’s crowd sourced analytics shows that Amazon’s Value Creation Index is not competitive vs. B-I-C

SIMMETHOD 2014 Competitive Intelligence Across Major Indices
10/28/2014 WWW.SIMMETHOD.BLOGSPOT.COM
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-20
-10
0
10
20
30
40
50
60
70
Apple
Facebook
Yahoo
Google Amazon
Aveg. B-I-C
B-I-C SIMMETHOD Minimum Company Business Model Index
B-I-C SIMMETHOD Value Creation Index
B-I-C SIMMETHOD Management Controllable Resources Index
B-I-C SIMMETHOD Strategy/ Execution Performance Predictive Index
Measuring with absolute data such as “sales growth” does not always reveal the true picture

SIMMETHOD 2014 Competitive Intelligence Across Major Indices
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-20
-10
0
10
20
30
40
50
60
70
Apple
Facebook
Yahoo
Google
Amazon
Aveg. B-I-C
B-I-C SIMMETHOD Strategy/ Execution Performance Predictive Index
B-I-C SIMMETHOD Management Controllable Resources Index B-I-C SIMMETHOD Value Creation Index
B-I-C SIMMETHOD Minimum Company Business Model Index
Amazon’s competitive gap to the SIMMETHOD Best In Class

SIMMETHOD
•Amazon’s 2012 to 2014 Trends And Competitive Advantage Across The SIMMETHOD Indices
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Amazon’s 2012 to 2014 trend across the indices of the SIMMETHOD Best In Class showing:
•Competitive strengths,
•Competitive weaknesses,
•Industry agnostic Risk alerts and
•Opportunities for improvement in order to become Best In Class across a range of industries and fend off current and future competitors
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SIMMETHOD 2012 to 2014 Business and Industry Trends
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-15
-10
-5
0
5
10
15
Amazon 2012
Amazon 2013
Amazon 2014 Although absolute sales metrics are growing, the SIMMETHOD Sales and Strategy/Execution Indices are not

SIMMETHOD 2012 to 2014 Business and Industry Trends
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-15
-10
-5
0
5
10
15
Amazon 2012
Amazon 2013
Amazon 2014
SIMMETHOD’s crowd sourced analytics shows that Amazon’s competitive advantage trend is negative vs. peers and SIMMETHOD’s Best in Class

SIMMETHOD Your trend versus the SIMMETHOD Best In Class
Your level of risk increases if and when:
•Your data (such as Amazon’s sales) points North and your SIMMETHOD indices point South, or
•The gap between your indices and the SIMMETHOD Best In Class indices is widening, or
•Your SIMMETHOD composite indices are not supported by your management controllable or operational indices.
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SIMMETHOD’s C-Level Trends 2012-2014 Amazon and the Best-In-Class
•When the Best-In-Class and your SIMMETHOD C-Level indices are moving in opposite directions, your ability to compete weakens in proportion to your widening gap to the Best-In-Class.
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SIMMETHOD Trends against the SIMMETHOD Best In Class
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-10
-5
0
5
10
15
20
25
30
35
2012
2013
2014
Average B-I-C SIMMETHOD Strategy/ Execution Performance Predictive Index
Amazon SIMMETHOD Strategy/ Execution Performance Predictive index Is there a measurable & predictive trend developing?

10/28/2014
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-2
0
2
4
6
8
10
12
14
16
2012
2013
2014
Avg. B-I-C SIMMETHOD Management Controllable Resources Index Amazon SIMMETHOD Management Controllable Resources Index
SIMMETHOD found a correlation between the resource management index and value creation

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-5
0
5
10
15
20
2012
2013
2014
Avg. B-I-C SIMMETHOD Value Creation Index Amazon SIMMETHOD Value Creation Index

10/28/2014
39 0 1
2
3
4
5
6
7
2012
2013
2014
Avg. B-I-C SIMMETHOD Cash/Debt Index
Amazon SIMMETHOD Cash/ Debt Index

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40
0
0.5
1
1.5
2 2.5
2012
2013
2014
Avg. B-I-C SIMMETHOD Sales Index
Amazon SIMMETHOD Sales Index

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41
-5
-4
-3
-2
-1
0
1 2
3
2012
2013
2014
Avg. B-I-C Overheads Index
Amazon SIMMETHOD Overheads Index

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42
0
1
2
3
4
5
6
2012 2013
2014
Avg. B-I-C SIMMETHOD HR Index
Amazon SIMMETHOD HR Index

•In summary, most SIMMETHOD indices show a widening negative gap vs. the SIMMETHOD Best In Class average highlighting Amazon’s increased competitive risk vs. peers and the Best In Class in the Technology League Table
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SIMMETHOD Best In Class and Risk Profiles
•SIMMETHOD Best In Class analytical profiles and risk alerts provide you and your C-level with a large number of levers to improve your performance and reduce your risk
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Amazon 2013-2014 Gap to the SIMMETHOD Best In Class Profiles
•Are Amazon’s gaps to the SIMMETHOD Best In Class and risk profiles narrowing or widening and are they aligned to their indices?
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Is there a disconnect between your SIMMETHOD indices and your gap to the Best In Class profile?
•When your SIMMETHOD indices are trending up and your gap to the SIMMETHOD Best In Class and risk profile is negatively widening, your C- Level sensors are presenting you with specific risk and opportunity alerts. Why?
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Is there a disconnect between your SIMMETHOD indices and your gap to the Best In Class profile?
Unlike your SIMMETHOD indices that holistically measure your strategy/execution or competitive position within a business league table, your gap to the Best In Class profiles provides: A specific C-Level ratio by ratio path to a moving Best In Class performance and risk management profile database or your pre-established targets Risk and opportunities alerts that can be acted upon to reduce the gap to the Best In Class, improve your performance , competitive advantage and reduce your risk level
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Amazon and the SIMMETHOD 2014 Best In Class Profile SIMMETHOD’s 2014 B-I-C average profit per employee is 52x higher than Amazon
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Amazon and the SIMMETHOD 2013 Best In Class Profile SIMMETHOD’s 2013 B-I-C average value per employee is 1.8x higher than Amazon
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Amazon and the SIMMETHOD 2014 Best In Class Profile SIMMETHOD’s 2014 B-I-C average value per employee is 2.8x higher than Amazon 10/28/2014
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Amazon and the SIMMETHOD 2013 Best In Class Profile
SIMMETHOD’s 2013 B-I-C average sales per employee are 1.5x higher than Amazon
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Amazon’s sales per employee are 1.2x higher than the SIMMETHOD’s 2014 B-I-C average
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Amazon’s needs $1.1x more cash than the SIMMETHOD 2013 B-I-C to generate $1/value
10/28/2014 WWW.SIMMETHOD.BLOGSPOT.COM
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Amazon needs 2x more cash than the SIMMETHOD 2014 B-I-C to create $1/value
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Your gap to the SIMMETHOD Best In Class profiles determines your results
According to the SIMMETHOD crowd sourced analytics and in comparison to the SIMMETHOD Best In Class profiles:
Amazon’s 2014 sales per employee are above B-I-C levels, Profit and value per employee are decreasing and
To generate $1 of business value, Amazon requires double the cash of the Best In Class
10/28/2014
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Your gap to the SIMMETHOD Best In Class profiles determines your results Amazon’s risk level is increasing for the following reasons:
There is a disconnect between the Management Controllable Resources Index that represents the levers of value creation under management control and Amazon value creation index
Most of Amazon’s SIMMETHOD indices are trending down and the gap to the Best In Class is widening
The SIMMETHOD Best In Class are improving at a faster rate than Amazon.
10/28/2014
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Amazon 2014 SIMMETHOD Risk and Performance Summary
Index
Value
Index trend
Index trend
vs. B-I-C
Gap to B-I-C & risk profile ratios
7 Laws compliance
Sales
+
=
-
+
-
Overheads
-
-
-
-
HR
+
-
-
-
-
Cash/Debt
+
-
-
-
-
Management Controllable Resources
-
-
-
-
Minimum Company Business Model
-
-
-
-
Value Creation
-
-
-
-
-
Strategy/execution Performance Predictive
-
-
-
-
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SIMMETHOD’s Disclaimer
•The purpose of the SIMMETHOD Strategy & Execution Performance Predictive Index and risk and opportunities alerts is not to make a business right or wrong but rather contribute towards the understanding of management actions in comparison to industry’s peers and the SIMMETHOD Best In Class.
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•SIMMETHOD’s Strategy & Execution Performance Predictive Index and risk and opportunities alerts do not seek to be exact but rather serve as a conduit to ask better questions and seek better answers in the performance improvement, risk minimization and value creation journey.
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•Sometimes, the value of a metric in itself does not provide the greatest of insights, but valuable actionable knowledge is gained from its ability to provide a trend or a common comparison yardstick with other businesses across a range of industries.
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•This Presentation is for informational purpose only and SIMMETHOD shall not be liable for the contents of the Presentation or for any damage incurred or alleged to be incurred to any of the businesses included in the Presentation as a result of its content.
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In summary, are the:
•Strategy & Execution Performance Predictive Indices,
•Best In Class profiles,
•Risk and opportunity alerts and
•7 Laws of Growth and Value Creation good leading indicators of Amazon’s threats, opportunities, risk and performance?
10/28/2014
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SIMMETHOD Risk and Opportunities Alerts
SIMMETHOD is in the top 1% of most viewed on Slideshare and has been “Hot” on LinkedIn, Twitter and Facebook 50 times.
10/28/2014
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Jorge Oscar Tabacman jtabacman@gmail.com Twitter ID: SIMMETHOD
SIMMETHOD A new way to measure and predict the risk and performance of your business and alert you of new threats and opportunities 10/28/2014 64

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