1 © 2014 Steelwedge Software, Inc. Confidential.

Single Line of Sight: Plan, Perform, Profit

IndustryWeek Webinar

Game On! Sony Plans for Profitability with S&OP

Technology

Game On! Sony Plans for Profitability with S&OP Technology

PlayStation has the Most Popular Video Games 3

4

Movie Here

Sony Computer Entertainment America

SCEA is a division of SONY Corp of America

PlayStation® game console introduced in USA 1995.

Responsible for PlayStation brand in USA, Canada, and Latin America.

Platform categories are Hardware, Software, Peripherals, and Digital.

Tough planning cycle with long lead times on Hardware and Peripherals.

PS4 PS3 PSN PS Vita

2010 - Impetus for Change and Current State of S&OP

●We needed to get S&OP going for fall 2013 release of PS4.

● SCEA not organized functionally.

● Strategy executed from annual budget.

●Reporting is not planning.

●No single source of truth.

At 15yrs, we were the world’s oldest start-up!

S&OP: SCEA’s Journey

7

H1 2010

Education and Initial Assessment

S&OP Roadmap

H2 2010

Build Foundation Capabilities

Consolidated Item Master

NPI Milestone Review

H1 2011

S&OP Design Complete

S&OP Process Defined

S&OP Calendar Established

H2 2011

Pilot S&OP and Select Technology

Tool Selection and Implementation

H1 2012

Full S&OP Implemented

Full Senior Exec Team & CEO included in Exec S&OP

S&OP: SCEA’s Journey (cont.)

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H1 2013

S&OP Process Expansion

Innovation Pipeline Review and DSR

H2 2013

S&OP Process Execution

PS4 Launch Results

H2 2012

S&OP Business & Scope Expansion

Financial Integration

Telescopic Calendar

H1 2012

Comparative Sales Results at Launch

Hardware 0.9M 2.3M

Software 1.9M 4.8M

Peripherals 1.1M 2.1M

Total Revenue $0.7B $1.3B

Source: NPD US, Nov’13 ~ Jan’14, Nov’06~Jan’07.

First 3 Months of Unit Sales

Crawl-Walk-Run-Sprint: Methodology & Fast Returns

10

Phase One with :

•Demand planning and an executive engagement phase of the total sales and operations planning (S&OP) life cycle.

Over the course of four months, Steelwedge worked with SCEA to:

•Automate the data integration process to sync plans into a single view and minimize risk of errors from multiple sources. •Provide executive-level visibility to the demand forecasts to show the financial impact of changes in forecasts to inform business priority decision-making.

Crawl-Walk-Run-Sprint: Methodology & Fast Returns

11

Phase Two with

• Synchronized new forecasting strength via supply planning and collaboration with SCEA corporate suppliers and telescopic planning. •SCEA enabled Telescopic Planning for easy movement between weekly and monthly planning periods, allowing a much closer, more frequent look at impacts to its supply and demand.

Looping Back to Leap Forward

Demand Signal

Forecast Process

Allocation & Supply Planning

Better Demand Signal

Drives Forecast Accuracy

Improves Supply Planning and Allocation

S&OP Benefits with Steelwedge

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● Profitability

SCEA forecast accuracy improvement from 60% to ~85% immediately

drives better profitability.

SCEA now has enough data insight to push from SKUs to channels, more

intelligently.

● Market Share

Better consensus planning, powered by Steelwedge, helps SCEA make

better Supply, Demand and tradeoff decisions, due to more reliable data.

The faster to market, the better the market share potential.

● Scalability

The cloud-based solution from Steelwedge allows SCEA to power its

process in scope with its evolving market.

Profitable Supply/Demand Tradeoffs at Sony

“Steelwedge provides the visibility we require to run our business, and

delivers it in a way that is intuitive for business users to

consume. Steelwedge has the secret sauce of a high performance

system that is easy to understand. Steelwedge is planning on steroids.

It’s a truly unique offering.”

Sree Vaidyanathan

Director of Business Applications

Sony Computer Entertainment America

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High ~85% forecast accuracy

(up from 60%)

1 million units of PlayStation 4

preordered

2.3 million units Sales of PlayStation 4

sold in first 3 months

Success by the Numbers:

15 © 2014 Steelwedge Software, Inc..

Single Line of Sight: Plan, Perform, Profit

Agility Webinar Series

Game On!

Sony (SCEA) Plans Profit with S&OP Technology

16 © 2014 Steelwedge Software, Inc..

Agenda

• Problem: The Spreadsheet Approach

• Solution: S&OP Automation

• Key SCEA Success Areas

• Q & A

17 © 2014 Steelwedge Software, Inc..

Pre-ESOP

Ground Reality: Trying It With Spreadsheets

Demand Planning, SCM/APS Systems

ERP, Financial, & Transactional

Systems SAP, Oracle, etc.

Industry

Data

Consolidation, Review,

Overrides

Data Collection,

Reconciliation

Consensus Process ESOP

Operations

Marketing

Sales

Finance

Manual

Complex

Security Risk

Not Scalable

Does this Give Executives

an Agile Decision Making Process?

Systems Landscape

18 © 2014 Steelwedge Software, Inc..

Change Your Reality; Drive S&OP Adoption & Values

Time

L1

L2

L3

L4

Q1 Q2 Q3

Step Change

Maturity &

Performance

Avoid Process

Failure

Q4

Val

ue

Accelerated

Time to Value

“Companies can have a hard time getting past basic levels of S&OP without

technologies like Steelwedge to support the process”

-Tim Payne

VP Supply Chain Analysis, Gartner

19 © 2014 Steelwedge Software, Inc..

Best Practice S&OP Aligns People, Process & Systems

“We continue to look at S&OP as an

aspect of business that

needs terrific improvement…

It’s hard to argue this shouldn’t be a

central piece of management software”

–Rob Kugel, Ventana Research

20 © 2014 Steelwedge Software, Inc..

Return on Investment is Substantial

Value Levers

50-70% Reduction

15-30% Improvement

20%-25% Reduction

25% Reduction in

Stock-outs

1-2% Lift in Revenue

Typical Results

21 © 2014 Steelwedge Software, Inc..

S&OP Success with Steelwedge

Demand Planning, SCM/APS Systems

ERP, Financial, & Transactional

Systems SAP, Oracle, etc.

Industry

Data

Single Cross-Functional

Planning Environment

Interactive planning for:

•All S&OP Stakeholders

•Plan Review

•Overrides

•Assumptions

•Scenarios

•Consensus Process

•Pre-S&OP

•Executive S&OP

•Audit Trail

Systems Landscape Product / Sub-Family Customer Revenue

Product / Family Territory / Region Revenue

Product / Family Promotions Revenue

Product / Family Region Units & Revenue

Product Stock Locations Units and Inventory

Family / Series Territory / Region Revenue, Margin & Cash

Family / Series / BU Geo Revenue, Margin & Cash

Product Production Site Units and Capacity

Family / Series / BU Geo Revenue, Margin & Cash

Family / Series / BU Geo Revenue, Margin & Cash

Planning Terms Stakeholders

Account Managers

Sales Managers

Marketing

Demand Planners

Supply Planners

Production Planners

Finance

Executives

Customers

Suppliers

Cross-functional Planning

Environment

22 © 2014 Steelwedge Software, Inc. Confidential.

Managing the Translation between Functions

Sales, Marketing, Product Management,

Demand Planning

Demand

Inventory, Production, Procurement and

Allocations

Supply

Profit & Loss,

Balance Sheet

Finance

Executive

Dashboards

Executive

23 © 2014 Steelwedge Software, Inc. Confidential.

Planning Dashboard

Steelwedge Enterprise Enabled Excel

Slice of view (hierarchy)

Time series of key figures

Planning data for review and

updates

Planning Views Combine Planning, Analytics in Familiar UI

Capture institutional knowledge / assumptions

24 © 2014 Steelwedge Software, Inc. Confidential.

Why Steelwedge?

• 100% S&OP Focus & Best Practices

• Proven Track Record of Delivering S&OP

• Ease-of-use, Flexible & Scalable Solution

• Power of the Cloud to Leverage Big Data

• Leverages Existing Investment in Systems

• Crawl Walk Run Approach “We’ve built a lot of structure to power our agility with

people, process and technology at Contech.

I need a holistic view and Steelwedge delivers. There are

very few out there that can do what Steelwedge does.”

- Randy Ramsey, Director Supply Chain, Contech

25 © 2014 Steelwedge Software, Inc..

Steelwedge is a strong leader in S&OP and IBP

“Steelwedge is an ideal solution for a heterogeneous environment with multiple S&OP processes

with inputs from multiple ERP and APS technologies.”

Lora Cecere

Founder and CEO, Supply Chain Insights

“Steelwedge has grown into one of the market's leading S&OP solutions". “Steelwedge has

proven that it provides a capable and scalable Stage 3 S&OP solution suitable for global

deployments.”

Tim Payne

Research Vice President, Supply Chain Research Group, GARTNER

Steelwedge was among the highest ranked in capabilities scoring and was one of “the vendors

that were notable in portfolio strategy and portfolio benefits delivered.”

Simon Ellis

Supply Chain Practice Director, IDC

26 © 2014 Steelwedge Software, Inc. Confidential.

Crawl – Walk – Run Approach

• Key to success is incremental value

• Crawl: plan ahead with end in site

• Walk: implement single solution

• Run: measure, improve, expand

• Sprint: align, integrate, monitor

• Start with quick win as phase 1 & foundation

• Expand the roll-out adding value as you go