THE ALTA INVITATIONALTHE ALTA INVITATIONAL

Resetting A CompanyResetting A Company

To The New NormalTo The New Normal

2

The Equipment Finance EcosystemThe Equipment Finance Ecosystem

WHAT IS THE NEW NORMAL?WHAT IS THE NEW NORMAL?

EconomicActivity

IndustrialPolicy

Customers

EconomicStructure

LegislationReputation

ChannelPartners

Competition

RiskEnvironment Technology

Regulation

Sources CapitalAdequacy

ProductFeatures

Investors

PUBLICPOLICY

MARKET

EXTERNAL

Risk /Reward

CAPITAL

OPPORTUNITIES

3

THE NEW NORMAL – ARE WE TREATING IT AS NEW?

PREVIOUSNORMAL

NEWNORMAL

•DECISIONS ABOUT CUSTOMERS

•DECISIONS ABOUT VALUE TO BE ADDED

•DECISIONS ABOUT POLICIES and PROCESSES – USE OF TECHNOLOGY

•DECISIONS ABOUT ORGANIZATION / PERSONNEL

•DECISIONS OF SCOPE OF BUSINESS

TRANSITION

4

OR – ARE WE WAITINGTO GO BACK TO THE OLD NORMAL?

NEWNORMAL

PREVIOUSNORMAL

I liked the wayit was, please come back

5

Resetting My Company Resetting My Company to the New Normalto the New Normal

RESET DECISIONS

CUSTOMERSELECTION

VALUE TO BEPROVIDED

HOW DO WEMAKE MONEY

ORGANIZATIONADMINISTRATION

BUSINESS SCOPE

?

?

? ? ? ?

? ? ?

???

??

?

6

Genuine ChangeAre We Doing This

TODAY

TOMORROW

FUTURE

OBJECTIVE

FOCUS

PEOPLE

Extend and defendcore business

Build emergingbusinesses

Business maintenance

Bottom lineperformance

Create viableoptions

Top line growth –Capital efficiency

Future potential

Business builders Visionaries

7

OR, ARE WE DOING THIS?OR, ARE WE DOING THIS?

TODAY

TOMORROW

FUTURE

YESTERDAY

TODAY

TOMORROW

8

GROWTHGROWTH

9

DiscussDiscuss

Basic Growth Basic Growth Strategy QuestionStrategy Question

Is the Purpose Is the Purpose of a Company of a Company

to Create a to Create a Customer?Customer?

10

What are the most What are the most important “growth” words?important “growth” words?

1.

2.

3.

4.

5.

11

Utopia – What You say is what your customer

needs, hears and

experiences

How You Build YourHow You Build YourValue Proposition?Value Proposition?

Customers & Competitors define Your

value proposition

Customer Perception of

Your Value Proposition

Your value proposition is

Unclear

Customer Perception of

Your Value Proposition

Value Proposition

GapValue Proposition

Assigned by Customer Base and/or

Competitors currently

Future State

Customer Alignment

Historical State

Transition State

12

What are the five most What are the five most important “value” words?important “value” words?

1.

2.

3.

4.

5.

13

Developing A growth StrategyDeveloping A growth Strategy

INNOVATIONINNOVATION-ProductProduct-ProcessProcess

EFFICIENCYEFFICIENCY-Low Cost

Provider

CUSTOMERCUSTOMERINTIMACYINTIMACY

-Service-Knowledge-Integration

Michael Porter’s Three Basic Michael Porter’s Three Basic Go To Market StrategiesGo To Market Strategies

Which Growth and Value Words Fit Which Strategy Best?

14

Some of those “frequent” words!Some of those “frequent” words!• Value

– Unique– Service– Scale / Scope– Global– Customized– Integrated– Cost– Package / bundle– Flexibility– “state of art”– Knowledge– Risk Management

• Growth– Profit– Scale / Scope– Sustainability– Risk Tolerance– Organic– Opportunity– Demand– Personnel– Organization– Capabilities – Footprint– Select Sector– Premium– Strategic– Partnering

15

Who is your value proposition for? What market? What segments?

The Components Of A Value PropositionThe Components Of A Value Proposition

TARGET

FRAME OF REFERENCE

BENEFITS

Required to gain acceptance from customers.

Begins to positively separate you from your competition.

Significant points of leverage with customers to get business.

com

pri

sed

o

f …

. .

Point of Entry

Point of Differenc

e

Point ofPreference

What competitive options are your target customer evaluating you against? Who are we competing against?

What’s in it for them? Why should they work with and buy from us?

16

The Equipment Finance EcosystemThe Equipment Finance Ecosystem

WHAT IS THE NEW NORMAL?WHAT IS THE NEW NORMAL?

EconomicActivity

IndustrialPolicy

Customers

EconomicStructure

LegislationReputation

ChannelPartners

Competition

RiskEnvironment Technology

Regulation

Sources CapitalAdequacy

ProductFeatures

Investors

PUBLICPOLICY

MARKET

EXTERNAL

Risk /Reward

CAPITAL

OPPORTUNITIES

THE ALTA INVITATIONALTHE ALTA INVITATIONAL

Resetting A CompanyResetting A Company

To The New NormalTo The New Normal

A SUMMARYA SUMMARY

18

New Normal – “New Normal – “Sound Bites”Sound Bites”

• The New Normal is the increased Pace of Change.

• A Challenging Time, not a Paradigm Shift.• There IS a New Normal with important new

conditions:– Less leverage / Capital adequacy.– Lower risk tolerance.– Changed customer behavior: Need replaces want!– Slow growth.– A sense of the future is less clear and change is

faster.

19

New Normal – “New Normal – “Sound Bites”Sound Bites”

• New Normal is what the market does.• This New Normal is that a lot happened all

at once.• The industry is at a “transformative” place

ending a 20 Year Old Normal of good times.

• Companies now have the opportunity and impetus to alter business models and change unsustainable practices.

20

New Normal – “New Normal – “Drivers”Drivers”

• The New Normal is a flat economy with shifts of New Sectors and Old Sectors changing opportunities.

• Consolidation.

• Too much capacity.

• Specialization.

• Discipline.

• Strategic.

21

New Normal – “New Normal – “Drivers”Drivers”

• Realities of running a business, the entire package:– Strategic management– Customer selection– Attention to Value Proposition– Customer centric, focused on service and

solving needs– Risk management

22

New Normal – “New Normal – “Drivers”Drivers”

• Importance of scale and efficiency.

• Importance of deploying technology.

• Public Policy:– Financial Accounting– Financial Reform– State legislation related to practices

23

New Normal – “New Normal – “Customers”Customers”

• Importance of defining the customer.

• Company behavior, a reduced tendency to borrow.

• No more “single source” for customer borrowing.

• Customers see Equipment Finance Company as an outsource of risk.

24

Marketing MattersMarketing Matters

INNOVATIONINNOVATION-ProductProduct-ProcessProcess

EFFICIENCYEFFICIENCY-Low Cost

Provider

CUSTOMERCUSTOMERINTIMACYINTIMACY

-Service-Knowledge-Integration

Michael Porter’s Three Basic Michael Porter’s Three Basic Go To Market StrategiesGo To Market Strategies

25

- Which Strategy is easiest to implement?Which Strategy is easiest to implement?- Which Strategy is easiest to defend?- Which Strategy is easiest to defend?- Which Strategy is hardest to replicate?- Which Strategy is hardest to replicate?

INNOVATIONINNOVATION-ProductProduct-ProcessProcess

EFFICIENCYEFFICIENCY-Low Cost

Provider

CUSTOMERCUSTOMERINTIMACYINTIMACY

-Service-Knowledge-Integration

Michael Porter’s Three Basic Michael Porter’s Three Basic Go To Market StrategiesGo To Market Strategies

26

Genuine ChangeAre We Doing This

TODAY

TOMORROW

FUTURE

OBJECTIVE

FOCUS

PEOPLE

Extend and defendcore business

Build emergingbusinesses

Business maintenance

Bottom lineperformance

Create viableoptions

Top line growth –Capital efficiency

Future potential

Business builders Visionaries

WORK HERE

27