Cedric MilletSr Procurement Manager EMEA, Ecolab

AGENDA EMEA Fleet Strategy & Overview

Eastern European Focus

Key challenges over harmonization

In tender process

In roll-out of fleet management

In control and reporting

In policy

How do we capture data?

transparency & reporting?

How do we ensure safety and environmental alignment?

Fleet Management Strategy - EMEA

Centralized Fleet Management

Harmonized Policy and Selectors

Consolidated Business Processes

Vision

Goals

Strategy

Reduce Fleet Admin Time and Resources

EMEA Fleet Policy and Fewer Suppliers

Reduce EMEA Fleet Expenses 15% over 3 years

Centralize Fleet Processes/Reporting

Consolidate/Leverage Suppliers and Services

Single Source Fleet Admin

Dilemma: Customize or Not?

Advantages

Have exactly what is

needed for specific

situation

Disadvantages

Expensive to develop

and maintain

Complicated and

expensive to upgrade

Inconsistent output

Situational, limited use

When to Customize

No acceptable standard option

Meet regulatory requirements

Meet unique business requirement

Fleet Overview EMEA

15%

Combined EU fleet TCO estimated at 66 M$+ per annum in 2012

Understand the current state

Notes:source: (1) Global Fleet Inventory updated by local fleet coordinator

(2) General Ledger consolidated EMEA

Eastern European Fleet Overview

12 countries out of 36

(33%) accounting for 16%

of EMEA fleet size

Challenges over harmonization

A fragmented VAT Rates accross EU

AGENDA EMEA Fleet Strategy & Overview

Eastern European Focus

Key challenges over harmonization

In roll-out of fleet management

In control and reporting

In policy

How do we capture data?

transparency & reporting?

How do we ensure safety and environmental alignment?

In Tender Process

• Create Process

Maps

• Summarize Key

Process Data

• Identify Pain

Points

• Prioritize Pain

Points

• Support Key Pain

Points With Data

• Determine Root

Causes of Key

Pain Points

• Measure

Process

Performance

• Make Required

Adjustments

• Finalize

Financial

Impact

• Capture

Lessons

Learned

• Assess

Performance vs.

Initial Objectives

• Review Initial

Metrics

• Gather Feedback

From Users

• Make

Refinements As

Needed

• Create

Implementation

Plan

• Conduct Pilots

• Make Adjustments

Based on Pilot

Results

• Communicate to

Key Stakeholders

• Conduct Training

• Implement New

Processes

• Initiate Metrics

Collection

• Generate Potential

Solutions

• Benchmark

Possible Options

• Consider Quick Hit

vs. Longer-term

Options

• Assess Cost /

Benefits

• Prioritize Options &

Make

Recommendation

• Select and Gain

Agreement on

Preferred Option

• Define &

Document

Required

Processes

• Define

Organizational

Responsibilities

• Define Key

Metrics

• Conduct Mistake

Proofing

• Create Work

Processes &

Tools

Step 1 Step 2 Step 3 Step 4 Step 5 Step 6 Step 7

• Create Problem

or Opportunity

Statement

• Define Scope

• Create SIPOC

• Form Project

Team

• Create Action

Plan

• Estimate

Financial Impact

• Create Project

Charter

Initiate

Project

Understand

Current State

Brainstorm

Options &

Select

Solution

Create the

Solution

Implement

the Solution

Evaluate

Solution &

Refine

Hold the

Gains

7-Step Problem Solving/Process Improvement

Methodology

Team Project ScheduleRole Name Position

Leader Cedric Millet Project Manager

Team

Members

Anton de Kock

Mike Fleming

Adrian Waelchli

Gayle Pratt

Luc Malaise

All Fleet country coordinators

Lukasz Kicki

SVP HR

VP HR WPS

Comp & Ben Director

Global Fleet Director

Procurement

Procurement/Finance/HR

Finance

Coach Gayle Pratt

Champion Mike Fleming

Sponsor Anton de Kock

Finance Lukasz Kicki

Phases Plan Adjusted Actual

Initiate Project 25/01/2012 23/02/2012 23/02/2012

Current State 23/02/2012 09/05/2012

Select Solution 09/05/2012

Create Solution 30/05/2012

Implement

Solution

30/06/2012

Evaluate & Refine 15/07/2012

Hold the Gains 10/09/2012

Problem Statement Scope

• 2 different car policies resulted form the merger in EMEA

• The combined organization runs a fleet of circa 5’288 units totalizing 66 M$ FY2012

• A noticeable gap of 15% in TCO value by unit between both organisation

• EMEA region

• 66 $MM - 70 $MM

• 5’288 # on the road incl. both leased & owned

• Fundings; Insurance; OEM; MRT & fuel practices; Car policies; Comp & Ben.; Procure2Pay Process

Expected Benefits Financial impact

• Harmonized EMEA car policy to streamline processes• Maximize driver satisfaction, safety, sustainability• Improvement of Ecolab’s competitive position by managing

effectively car fleet• Deliver productivity gains short & Long-Term

Measurements (Targets) Risks Delta TCO (actual Vs revised) X # renewals per year

Driver satisfaction: Attrition rate• Sales force motivation; increasing fuel cost; corporate image

• Company attractiveness

2012 $MM Full Impact $MM

Cost Productivity 1.7 5.7

P&L impact 1.7 5.7

Cost Avoidance -

Capex & Working Capital

1 Initiate

Project

2 Understand

current

state

7 Hold

the

Gains

6 Evaluate

Solution

& Refine

5 Implement

the

Solution

4 Create

the

Solution

3 Brainstorm

Options

& Select

Solution

Sourcing Strategy Methodology

OEM to provide % off net vehicle/segment & incremental cash incentive

Lease company to quote on anticipated residual value, maintenance & tires cost, luxury tax, fuel cost, Road tax, CO2 tax

OEM

Lessors

TCO

Residual Value +

upfront discount

+ cash incentive• Best TCO across EMEA

• Best Safety NCAP rate & CO2 emission

• Best dealerships networks

• Best Models reliabilities

• Best tax liabilities for associates & the corporation

• Replacement cycle 5 years and 160-200,000 KM

OEM Bid ScopeCountry

Executive

Car_E

segment

Large

Family

Car_D

Segment

Large

LCV

Large

MPV_D

MPV

Large Off-

Road_D_

SUV U

PICK-UP

Small

Family

Car_C

segment

Small

LCV

Small

MPV_C

MPV

Small Off-

Road_C

SUV

TOTAL VEHICLES

ORDER FORCAST

Q4 2012- Q4

2015

FR 7 79 56 8 3 3 197 307 197 2 859

UK 20 211 19 1 34 125 126 30 566

DE 41 278 12 27 59 5 60 482

IT 8 61 7 1 139 64 70 1 351

ES 1 81 11 2 107 13 16 2 233

Russia 2 19 2 19 4 72 29 147

PL 2 56 2 66 11 2 139

South

Africa 114 8 2 1 125

BE 12 50 10 12 19 14 117

NL 3 37 7 3 45 8 103

Turkey 3 10 1 61 7 2 84

CH 10 28 1 3 1 2 2 15 9 71

GR 2 33 23 5 63

SE 14 37 1 1 5 2 1 61

DK 8 28 9 7 5 57

NO 11 25 5 2 3 6 1 3 56

IE 2 18 1 1 4 6 20 1 53

AT 2 21 3 7 5 12 50

FI 11 17 7 35

HU 1 8 1 19 6 35

Romania 5 1 26 2 34

CZ 13 1 15 4 33

PT 8 1 15 2 26

Slovenia 15 1 2 6 24

Ukraine 11 10 2 23

Croatia 5 8 10 23

SK 9 6 1 4 20

Bulgaria 3 16 19

UAE 2 16 18

Serbia 6 6 1 1 14

Latvia 1 1 6 1 2 11

Kenya 5 1 1 7

Tanzania 1 5 6

Morroco 1 1 2

Uganda 2 2

LU 1 1

Grand

Total 161 1176 133 84 28 174 1098 551 493 52 3950

• 36 countries in scope across 10 vehicle segments

Ingredients to fuel OEM fierce competition

• BMW

• RENAULT

• FORD

• PSA

• GM/OPEL

• VW

• MERCEDES

• CHRYSLER/FIAT

• NISSAN

• TOYOTA

• VOLVO

Manufacturers

Portfolio invited

Forward /Reverse Auction

• Ford

• GM

• Fiat

• Renault

• Nissan

• PSA

• Volvo

• Toyota

• Mazda

e-Bids

Attendees

• Single

• Dual

• Multiple

Award

Badges

• VW group

• MB

Outside e-Bids

Attendee

STRATEGIC SUPPLIER CAPABILITIES

Diverse product and dealers

Worldwide product coverage

Safety

Financial stability

Environmental strategy/plan

Fleet commitment

Dedicated global fleet team

Ability to make global decisions

RFQ value (best in class value)

Total cost of ownership

Strategic relationship

Chrysler/ Fiat

GM Ford Nissan/

Renault

VW Toyota PSA Daimler Volvo Subaru

Illustration

AGENDA EMEA Fleet Strategy & Overview

Eastern European Focus

Key challenges over harmonization

In roll-out of fleet management

In control and reporting

In policy

How do we capture data?

transparency & reporting?

How do we ensure safety and environmental alignment?

In Tender Process

From 9 to 6 Car LevelsCar

LevelJob Level

Ecolab

(Indicative Job

Positions)

Vehicle

Segment

Nalco (Indicative Job

Positions)

Vehicle

Segment

L9President, E-

3, EVP, SVPPresident, EVP, SVP Executive GSM Executive

L8 E2- VPVP, Reg Div Mgr, Dir

Corp AcctsExecutive VP Executive

L7

E1,Director,

AVP, Country

Mgr

AVP, Country Div Mgr,

Plant Mgr, Director

Function

Executive &

D PremiumRSM, Director Function

Executive /

D Premium

L6 Sr. Manager KAM, PIP Mgr,

Country Sales MgrD Premium Area Sales Mgr, KAM

D & D

Premium

L5

Manager,

Sales

Executive

Associate DM, DM,

National AM, National

KAM,Sales Manager

D & D

PremiumSr.AM, DM, National KAM D

L4Senior

Professional

Sr. Territory Manager;

Country Region Key

Acct Mgr

C-MPV & DDistrict Rep I, Acct Mgr, Ind

Dvlp Mgr IIC-MPV

L3 Professional

Territory Manager;

Service Tecnhicians;

Service

Representative

CDistrict Rep II, III, App

Engineers IC

L2Specialist /

Entry Levels

Junior TM,TM: Field

Service EngineerC or B App Engineers II-III ; C

L1Service

ProfessionalService Tech LCV Service Tech LCV

Car LevelVehicle

Segment

L6 Executive

L5 D Premium

L4 D

L3 C-MPV & D

L2 C & B

L1 LCV

Other Best Practices/ Activities KPI Owner Expected KPI Impact

Trained Safety Champions in every Sales District 100% EMC members TRIR and TVAR reduction

Investigate all recordable injuries and ensure corrective actions are completed. 100% EMC members/Jim Smith TRIR reduction

Complete Intelex roll out for WPS EMEA Arjan Boogaards sign-off Arjan Boogaards/Jim

Smith

TRIR reduction

Communicate new harmonised SHE policies to EMC members and makeavailable to employees via the portal

100% Jim Smith TRIR and TVAR reduction

Sector / Region Name

EMEA 2013 Sector/Divisional Safety Goals

Leading Indicator Corp Goal EOY ‘12

2013 Target

Near Miss Reporting (WPS and ES) > 1 per month per district

Risk Assessment Training (WPS

and ES)

100% 100%

Safety Leadership Training for all

DMs (WPS and ES)

100% 100%

SOS refresher training – 3 year cycle (WPS and ES)

100% 100%

Safety Onboarding (SafeTNet or SOS) (WPS and ES)

100% 100%

ECAP Audit – WPS and ES- Manufacturing-other divisions

10% of districts33% of plantsKey accounts

100%100%100%

Personal Safety

Driver Safety

Lagging Indicator Corp Goal EOY ‘12

2013 Target

Total Vehicle Accident Rate (TVAR)

<2.2 – WPS and ES<5.56 – other divisions

<2.2<5.56

Severe Vehicle

Accident Rate

(SVAR)

<0.24 – WPS and

ES

<0.6 – other

divisions

<0.24<0.6

Lagging Indicator Corp Goal EOY ‘12

2013 Target

Total Recordable Injury Rate (TRIR)

<0.4 – WPS and ES

<1.73 – other

divisions

<0.4<1.73

Leading Indicator Corp Goal EOY ‘12

2013 Target

Behind the Wheel (BTW) 33% of drivers

33% of drivers

Why Behind The Wheel Training?

Ecolab Europe spend $2.6 million on car repairs per year.

One accident costs an average of $100 in repairs, excluding cost of replacement car etc.

Nalco have had a 57% reduction in accidents over the last 6 years, implementing the same training – so we know it works.

Nalco Europe spend $.3 million on car repairs per year, with a fleet half the size of Ecolab’s

Reading policies has been shown not to be as effective as ‘on the job’ training

Expected Results

Lower accident rates

Reduced cost of repairs

Fuel savings 10-15%

Lower insurance costs

SHE program produced a 57% reduction in Nalco Vehicle Accident rates globally over a 6 year period and will leverage the key programs responsible

We Have Good Experience Base to Draw On

Global Driver Safety Policy

Global Cell Phone Policy

Motor Vehicles Records review policy

Global incident Investigation Policy

Defensive Driving Training

Reverse Parking Program

Standardization of vehicle safety features

Car chip program rollout

Zero Tolerance Policy

4.0 4.2 4.0 4.2

3.3

2.2 2.2

0.0

1.0

2.0

3.0

4.0

5.0

2005 2006 2007 2008 2009 2010 Nov-11

AGENDA EMEA Fleet Strategy & Overview

Eastern European Focus

Key challenges over harmonization

In control and reporting

In policy

How do we capture data?

transparency & reporting?

How do we ensure safety and environmental alignment?

In Tender Process

In Roll-out fleet management

Communication Plan Foundational Material Produced Purpose Audiences

EMEA Fleet Policy + EMEA Sector Leader letter

Announcement of / information on new harmonized policy

All employees

Foundational slides on the new policy (“Generic Deck”)

Explain essence of car policy and OEM strategy All employees

FACT Sheet New Policy at a glace - a 1 page overview with facts and link to Share Point with more information

All employees

FAQ’s Questions and Answers with details to new policy Available from share point and link on Express

Primarily for vehicle users, HR and fleet professionals, but accessible by all employees. Restricted section for HR and fleet mgmt

HR presentation / HR call Inform HR about their role in implementing the new policy + provide HR supporting materials

Regional/Cluster HR > Country HR; optional: Div HR

New Policy Information Calls(Broad Webex/ Introductory Teleconference)

Broad information to Countries about essence of new policy, and what it means for them

Country Mgmt Teams, Fleet representatives, HR > Vehicle owners

Fleet Share Point Site All material hosted (presentations, FAQ’s etc.) Periodically updated informs continuously about news and changes

Two audiences:1 A) Open access (general material): vehicle drivers, other interested associates 1 B) Vehicle sections: local lnguages of policy are posted in public section2) Restricted access (access to restricted material): ELT, Company Managers, HR Business Partners, Fleet Mgmt and Fleet Specialists

Implementation of Policy Approval of regional fleet policy

Regional Fleet Mgr > VP HR EMEA > ELT

Communication of guidelines

Regional Fleet Mgr provide guidelines for local adaptations (e.g. details of policy, driver class framework, forms, benchmarks, To Do list, questionnaire etc.)

Local adaptation by countries

Adopt driver classes locally

Confirm BIC Car Selector by driver class with CO2 limits.

Evaluate policy exceptions to „Trading Up/Down“

Support multi-bidding with fleet regional resource

Review of position eligibility to company car by HR

based on position requirement, market benchmark and internal guidelines;

EMEA to provide approach for associates no longer eligible, e.g. grandfather model / new hires no car

Proceed according to Implementation Guidelines and Approval Matrix

AGENDA EMEA Fleet Strategy & Overview

Eastern European Focus

Key challenges over harmonization

In roll-Out fleet management

In policy

How do we capture data?

transparency & reporting?

How do we ensure safety and environmental alignment?

In Tender Process

In control and reporting

Local vehicle

order

Local vehicle

lease / expenseEMEA Company

Country

EMEA Centralized

Fleet FunctionERP system

EMEA Country

EMEA Country

Electronic invoice

Or paper invoice

Reporting

Transparency to

fleet costs and

Fleet Admin Expense

Central RFQ/negotiation

Central ordering

Central (e-)reporting

Central monitoring

Fleet Process Flow - Strategy

Electronic order

How do we hold the gains?Building upon existing KPI and integrating quickly the newest conditions with our preferred OEM would help make break thru an harmonized EMEA car policy

WH

AT

?

FLEET

INVENTORY

BIC CAR

SELECTOR

Exclusively with

preferred OEM

Fully consistent car

segment by employee level

X Countries/X DivisionFLEET

BUDGET

Q1 2013 & onwards Roll-

out market by market

Operating as ONE Ecolab

to reduce complexity and

leverage forces

ACCIDENT

REPORTING

EVERY 15TH

MONTHLY

METRICS OEM

INTEGRATION

HARMONIZED

EMEA CAR POLICY

WH

EN

?

QUATERLY

Time 2 shout