Outsourcing & Application Mgt Discussion With DePaul May 19, 2003

June 26, 2024

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Top 10 Market Factors Overall, Outsourcing Is Still A Healthy Market Maturity of IT Outsourcing Immaturity of BPO, 2003 Expected To Be Critical Year Growing Demand for End-to-End Services Requires Focus Increased Competition Leads To Intense Price and Capital Pressure Highly Fragmented Competitive Landscape Outsourcing Market Volatility New Outsourcing Business Model Outsourcing Shift to a Long-Term Value Proposition Impacts of Economic Downturn: Elongated Sales Cycles, Cautious Spending 2003 Cap Gemini Ernst & Young - All rights reserved

Factors, Trends, & Implications Factor 1. Overall, Outsourcing Is Still A Healthy Market 2. Maturity of IT Outsourcing Trends/ Comments Outsourcing is the fastest growing segment of professional services Although some aspects of IT have slowed and components of process are in their infancy, key growth opportunities exist (e.g., AM, Offshore, SCM, F&A) Big 3 (IBM, EDS, CSC) established as early adopters in IT High penetration; at least 50% of Global 2000 now outsource at least some of their IT Enhance efficiency and effectiveness of internal and external sales channels, including consulting, outsourcing, and technology services, market makers, EY, and alliances Improve awareness in North America Improve deal selection and qualification Bundle ITO with BPO and consulting Leverage CGE&Y’s position in terms of flexible deal Commoditization of IT assets has caused cost cutting to shift from assets to cutting labor costs and raising productivity while clients are slow to invest in productivity projects needed for deal profit 3. Immaturity of Implication for CGE&Y structures and solutions (in comparison to EDS and IBM models geared at big IT deals) Key offerings that build on existing IT and process expertise, such Short-term opportunity costs in terms of outsourcing BPO as SCM, F&A/ERP and CRM, provide strong opportunities to bundle consulting, technology and process Small number of BPO deals signed in 2002; 2003 expected to be critical year in gaining BPO market share and capability BPO competitive landscape is in flux. Some of the more aggressive BPO providers are relatively new market entrants. Market consolidation, mergers and acquisitions are affecting other BPO players revenue, long-term impact to recurring revenue from consulting Invest in capability and market CGE&Y as BPO provider with strong focus in 2003 Leverage strengths in SCM, CRM, and Finance Transformation 4. Growing Client demand stems from need to reduce cost and make business Develop robust, yet focused service portfolio to enable Demand for End-to-End Services 5. Increased Competition improvements Provider demand fueled by need to achieve profit from deal and maintain other consulting revenues Few competitors can offer blended outsourcing-consulting solutions Strong value propositions tied to industry and/or process expertise Increasing pressure in pricing environment and capital intensity Diverse entrants entering market as their revenue streams decline (e.g., packaged application, software, and hardware companies) efficient bundling and quick response to client demands Identify enterprise-wide incentives for selling and delivering both outsourcing and consulting Clearly articulate value proposition of consulting & outsourcing to marketplace Focus on sales & delivery efficiency (e.g., offshore model, network of centers, methodology, smarter qualification and due diligence, and shared risk/reward in deal structure) 2003 Cap Gemini Ernst & Young - All rights reserved

Factors, Trends, & Implications Factor 6. Highly Fragmented Competitive Landscape Trends/ Comments Shrinkage of consulting services, systems integration and packaged application markets Consolidation expected which will further alter the landscape (e.g., IBMPwCC and non-traditional entrants) 7. Outsourcing Increased deal renegotiation; IBM and EDS have a high dependence on Industry Volatility recurring revenue Although rare, contracts are more frequently going to new providers Risks for service providers are associated with top clients (e.g., EDSWorldCom, IBM-Lucent and CSC-Nortel) Questionable accounting standards has brought negative coverage of industry thus impacting client acceptance of outsourcing (e.g., % completion for EDS) 8. New Outsourcing Business Model 9. Outsourcing Shift To A Long-Term Value Proposition Mega deals have not materialized; Analysts report approx. 1 to 4 signed in 2002 Unable to assess cost structure and complete proper due diligence has impacted profitability and success of deals Elongated sales cycles and introduction of process and consulting to IT outsourcing has brought new complications to model Outsourcing has shifted from simply reducing costs to driving strategic change and overall business improvement Due to economic environment, clients not funding innovation/ enhancement projects. In order for service providers to achieve profit, these projects are required Implication for CGE&Y Differentiate focused offerings and build capabilities through various strategies (e.g., organic, alliance) Consider acquisition to complete capabilities portfolio Market opportunity from contract renegotiation Minimize risk through smart client “portfolio” Maintain strong finance and deal structuring standards Define organizational model to support selling and delivery of end-to-end offerings Improve due diligence efficiency Focus on deals most likely to achieve financial success and/or enhance capability, not mega deals Ensure enhancements/innovation projects are bundled into outsourcing deal to protect profitability Bundle through a combination of consulting, BPO and ITO, as well as delivery options (e.g. center, offshore) 10. Impact Of Elongated sales cycles, cautious spending, and lack of attention from key Improve qualification process with sharp focus on Economic Downturn C-Levels required to close deal Reduction in scope of existing deals or restructuring of contracts Clients pushing more financial risk on service providers via tighter pricing and/or more capital-intensive deals Emphasize shared-risk, shared-reward in marketplace Clearly articulate value propositions for C-Level Return on Sales (ROS) audience that make the buying decision 2003 Cap Gemini Ernst & Young - All rights reserved

Market Growth ew Era of Greater Maturity and Moderated Growth for Outsourcing North America IT Outsourcing & BP Outsourcing Forecast, 2000-2005 (Millions of USD) 80,000 2000 Gartner’s May 2002 forecast update is 2005 60,000 40,000 20,000 8.0% CAGR 9.0% CAGR ITO BPO Operational Services Applications Management Help Desk Management Transaction Processing Services BPM Services (business transformation expertise applied as a part of a BPO contract) Key Findings 0 significantly different from the November 2001 forecast ITO was forecasted to grow at 11.2 % (CAGR) and is now forecasted at 8.0% (CAGR) BPO forecast was lowered from a forecast of 15.0% to 9.0% (CAGR) IT outsourcing continues to experience relatively healthy growth during the economic downturn, compared with other IT services, as a result of user emphasis on costreduction and efficiency enhancement The lack of disruptive new technology on which to build new solutions and drive transitional outsourcing had a negative impact on outsourcing overall Companies are focusing on core business processes, increasingly outsourcing non-core business processes, particularly back-office functions Note: Gartner published its forecast of the outsourcing market in November 2001 and a revised update in May 2002. Source: Gartner, Outsourcing Forecast Update: Feeling the Pain. 11 July 2002, Bruce Caldwell, Allie Young, Rebecca Scholl 2003 Cap Gemini Ernst & Young - All rights reserved

Service Offering Key Trends Increased Focus on End-to-End Business Function, Requiring a Combined Look at IT and Process IT Outsourcing (AM, IM) IM capability as a blended component will impact pricing and service packaging, not as a stand-alone offering Growing emphasis on offshore capability. Increased acceptance of offshore as providers demonstrate quality cost and customer service. Large outsourcers not moving fast enough to take advantage of this shift. While IT outsourcing overall has slowed, software development outsourcing has experienced growth and niche providers have prospered (e.g., Infosys revenues were up 32% in 2Q2002) Applications management expected to be the fastest growing sub-segment of ITO at an 11.6% CAGR in North America through 2005 New and formidable competitors emerging, including packaged application, software, and hardware companies. As systems integration and deployment revenue matures/declines, these companies are looking for new revenue streams in outsourcing Business Process Outsourcing Opportunity to improve ROI from mature investment projects such as ERP, CRM and Shared Services, as well as need to focus on core business, fueling demand Just as ERP systems enabled growth of Applications Management, SCM and CRM systems are expected to support growth of outsourcing technology and process in these areas Offshore represents opportunity to lower delivery cost— not a mature offering, except in very specialized process areas such as medical claims transcription and some contact center operations Through CRM, outsourcing plays a stronger role in impacting revenue generation vs. cost reduction only Increased demand for multi-process outsourcing Increased demand for knowledge-based business process outsourcing (from non-core/non-critical to noncore/critical to core/critical) Dependence of service providers on shared service model to offer cheaper, standardized and best-in-class services, and achieve profitability Growth of specialized industry solution centers that are able to manage both technology and process requirements, and adjust to industry needs 2003 Cap Gemini Ernst & Young - All rights reserved

Operate Americas Outsourcing Vision: “Earning the Right To Be Your Partner” Strategic Relationship Business Solutions Build and Operate Full IT Outsource Helping to Achieve Your Changing Business Goals Activity New things new way Responsibility for an IT or Other Business Function Same thing new way Same thing same way Operate: Application Management Infrastructure Management Business Process Management Providing Service to an Agreed Service Level Fixed Charge Transaction Based/ Open Book Facilities management Data Centre Services Application Support Desktop Support Network Services Shared Risk/Reward Contract Type 2003 Cap Gemini Ernst & Young - All rights reserved

0 Outsourcing Is a Natural Extension of Consulting Services FSI TMN 2003 Cap Gemini Ernst & Young - All rights reserved Outsourcing MRD Critical Technologies Energy / Utilities / Chemicals Support Services Health Business Process Outsourcing Applications Management Infrastructure Management Supply Chain Systems Development & Integration Technical Infrastructure CRM Management Vision Enterprise Technology Strategy Branding/Channel Strategy Integration Outsourcing Strategy & Transformation FullScope Sector & Service Lines Strategy ERP Full-Scope Service Spectrum

1 What are Companies Outsourcing? Operate is a collection of service offerings that provides capability beyond the traditional consulting model to include maintenance and operation of client systems. Information System Management (ISM) Applications Development Infrastructure Management and Management (IM) (ADM) Enterprise Solutions Management (ESM) IT-Enabled Business Process Management (BPM) 2003 Cap Gemini Ernst & Young - All rights reserved

2 Outsourcing Offerings Applications Development and Management (ADM) Ongoing maintenance, enhancement and development, and new releases/upgrades for client software applications Infrastructure Management (IM) Ownership of client’s IT platform hardware and its operations e.g. Data Center Operations, Network Services, Desktop Services, and Help Desk Business Process management/Outsourcing (BPM/BPO) Ownership or management of a business process function e.g. Call Center operations or Accounts Payable function 2003 Cap Gemini Ernst & Young - All rights reserved

CUSTOMER 1st Call Logging, Incident Management, Query handling Local Knowledge - Personalised Call Reception Problem Diagnosis/Analysis Co-ordination of Field Support SERVICE Center Local Knowledge Product Specialization Remote Support 2nd 3rd Product/Technical Specialists Other CG 3rd Party A M FM (CCS) Site Support Field Support Site Support PROBLEM MANAGEMENT CHANGE MANAGEMENT CONFIGURATION MANAGEMENT SIP/QUALITY MANAGEMENT SERVICE MANAGEMENT REP’ING 3 Infrastructure Management Service Management Measured Delivery Infrastructure Service Centers Third Party Management End User Support CyberCenters/Web Hosting Distributed System Support Network Solutions Centralized System Support ASP Support Infrastructure Service Centers - CGE&Y, Customer, Third Parties 2003 Cap Gemini Ernst & Young - All rights reserved

4 BPM Offerings Are Aligned With Major NonCore Business Functions Finance & Employee Transformation Supply Chain Transformation General Accounting Lead Logistics Provider Accounts Payable Sourcing / EProcurement Accounts Receivable Fixed Assets CRM Transformation Inbound & Outbound Call Center Mgt. Billing Freight Management Collections Fulfilment Customer Intelligence / Data Warehousing Credit & Collection Billing Management Reporting Payroll Supported by our Global Network of Centers (BPM, AM, IM) 2003 Cap Gemini Ernst & Young - All rights reserved

5 Once Non-Core Activities Are Identified, They Can Be Outsourced Or Eliminated Perform Internall y Outsourc e Eliminate Core Non – Core 2003 Cap Gemini Ernst & Young - All rights reserved Necessar y Not Necessar y

6 Top 10 Reasons Client’s Choose Outsourcing 60.2 Aim to achieve best practice Cost discipline/control 58.6 Improves service quality 42.1 41.0 Focus on core competencies Cluster 1: Cost & Efficiencies Want to achieve best practice throughout the organisation Want tight control over costs Cluster 2: Service & Delivery Want to improve service quality Want to enhance the organization Access to new technologies/skills 37.1 Reduce headcount 36.6 core competencies Enhance capability to develop new product/service 36.0 Cluster 3: New Technology & Reduce capital cost Grow in-house expertise Reduce transaction costs 34.0 28.4 27.4 Capabilities Want to gain access to new technologies and skills Want to reduce headcount Want to develop new products and services Want to reduce capital expenditure Cost Cost reduction reduction is is clearly clearly aa decision decision criteria criteria in in any any deal deal but but enhancing enhancing service service and and delivery delivery (through (through business change) is also a key factor. Cost alone is not compelling enough to drive business change) is also a key factor. Cost alone is not compelling enough to drive decisions decisions for for outsourcing outsourcing Source: Cranfield International Outsourcing Survey—693 US, UK & Continental European companies participated in the survey. 2003 Cap Gemini Ernst & Young - All rights reserved

7 Know How to Spot an Outsourcing Opportunity Entry into new markets or customer segments to improve market share Business Transformation New project initiatives slow to deliver or huge backlog of projects Capital spending in noncore business functions Loss of confidence in internal IT Consider Outsourcing Headcount reductions to reduce operating costs & increase productivity Planned spin-off, downsizing or merger New business alliances in process to broaden services Divestiture of non-core businesses New quality improvement programs underway CEO Agenda to reduce transaction costs Change in executive management Major new systems projects planned 2003 Cap Gemini Ernst & Young - All rights reserved Launch of various programs to improve operational efficiency

9 ADM Addresses Four Key Sets of Issues Business BusinessIssues Issues Free the organization to focus on its core competence Free the organization to focus on its core competence Secure funds & resources for business critical initiatives Secure funds & resources for business critical initiatives Improve quality of service & reliability of critical systems Improve quality of service & reliability of critical systems Increase competitiveness Increase competitiveness Concentrate on services innovation to drive future Concentrate on services innovation to drive future revenues revenues Share / manage risk across the development life cycle Share / manage risk across the development life cycle Financial FinancialIssues Issues Gain visibility & predictability of costs Gain visibility & predictability of costs Optimize Fixed vs. Variable costs Optimize Fixed vs. Variable costs Ensure value for money Ensure value for money Increase revenue & therefore profitability Increase revenue & therefore profitability Reduce costs – typically by 20% Reduce costs – typically by 20% Reduce debt burden Reduce debt burden People PeopleIssues Issues Free up resources for strategic business & IT initiatives Free up resources for strategic business & IT initiatives Avoid having to find & retain expertise, thus reducing Avoid having to find & retain expertise, thus reducing use of external contractors use of external contractors Avoid need to hire staff on a ‘just in case’ basis Avoid need to hire staff on a ‘just in case’ basis Mobilize and demobilize resources quickly Mobilize and demobilize resources quickly Offer better career paths for IT professionals Offer better career paths for IT professionals Quickly staff new projects (speed-to-market) Quickly staff new projects (speed-to-market) Gain network to knowledge through CGE&Y’s network of Gain network to knowledge through CGE&Y’s network of centers and resources centers and resources Technology TechnologyIssues Issues Gain access to better methodologies & tools Gain access to better methodologies & tools Migrate to new application more quickly Migrate to new application more quickly Optimize IT systems to handle increasing complexity of Optimize IT systems to handle increasing complexity of offers offers&&products products Align technology with business direction Align technology with business direction Industrialize the IT systems after launch period Industrialize the IT systems after launch period Benefit from a partner technology/packages watch Benefit from a partner technology/packages watch 2003 Cap Gemini Ernst & Young - All rights reserved

0 ADM Critical Success Factors Staff Maintain staff with depth of skills required to effectively manage environment Demand Management Respond to demand increases/ decreases for support resources Solutions Knowledge Effective solutions knowledge to provide consistent, reliable application support Proven Methodologies Disciplined methodology for delivering support services in a cost effective manner Change Prepare for business and technical environment change 2003 Cap Gemini Ernst & Young - All rights reserved

1 Application Development & Management Solutions “Build & Run” “Run” Management of existing package and/or custom built applications portfolios Optimizing Optimizing Clients Clients Business Business Models Models Management of the entire application lifecycle or specific IT Functions which could include development and support of new applications “Run - Build - Run” Maintenance of existing applications while transforming replacement applications, followed by the management of the new applications Applications Development and Management Services Break/Fix Quality Assurance/Testing Application Enhancements/Upgrades New Application Development Configuration Management Level 2 Help Desk Support Vendor Management Run/Host Applications 2003 Cap Gemini Ernst & Young - All rights reserved Ad Hoc Support Process Management Release Management

2 Build/Run Value Proposition for Clients Focus on core strategic competencies and rely on CGE&Y to deliver other needs Implementation Planning Post Go-Live Support Reduce operating and capital costs over the life cycle of the application Accelerate the pace of implementation and smooth the transition to the maintenance environment Gain access to scarce technical resources, as needed, rather than staffing to “just in case” Share/manage risk across the development life cycle Increase knowledge continuity of the application implementation into production, including application and business specific information Improve service levels 2003 Cap Gemini Ernst & Young - All rights reserved

3 Build/Run Can Deliver Significant Cost Savings Over the Life of the Application Reduces overall cost of build AND cost of transition to maintenance team. Cost Efficiencies, cost reductions further reduce cost over time. Y1 Y2 Y3 2003 Cap Gemini Ernst & Young - All rights reserved Y4 Y5

4 ADM Provides a Full Range of Services to Maximize Value, Quality & Flexibility Applications Development and Management (ADM) is: “a set of services which takes the contracted responsibility for any or all aspects of the maintenance, enhancement and evolution of applications systems within well defined service levels to maximize value, quality and flexibility.” Development Enhancements Maintenance User Support Service Management Scope Scope Pricing Pricing Staffing Staffing Location Location Legacy LegacyAM AM Custom CustomApps Apps Third-Party Third-Party Plan, Plan,Build, Build,&&Run Run ASP / Hosting ASP / Hosting Baseline Baseline Fixed Fixed Resource-based Resource-based Ours Ours Yours Yours New New Combination Combination On-site On-site Off-site Off-site Near-shore Near-shore Off-shore Off-shore Combined Combined 2003 Cap Gemini Ernst & Young - All rights reserved

5 CGE&Y’s ADM Solution: Scope of Services Base Services Service ServiceManagement Management CGE&Y service delivery management CGE&Y service delivery management rd Other 3 -party provider management rd Other 3 -party provider management Maintenance Maintenance Level Level22help helpdesk desk Break/fix & routine Break/fix & routinemaintenance maintenance Software configuration Software configurationmanagement management System & regression testing System & regression testing Implementation Implementationofofrequired requiredroutine routinevendorvendorreleased software patches released software patches Analysis Analysisofofroutine routinevendor-released vendor-released functional upgrades functional upgrades Enhancements Enhancements Minor Minorenhancements, enhancements,as asagreed agreed Extended Services Major MajorEnhancement/Development Enhancement/Development Support Support Enhancements Enhancementsthat thatexceed exceedlimits limits established for Base Services established for Base Servicessupport support New module evaluation New module evaluation Implementation Implementationofofmajor majorreleases, releases,new new functionality, new modules, new interfaces, functionality, new modules, new interfaces, etc. etc. Process Processreengineering reengineeringactivities activities Decision support Decision support Consulting ConsultingServices Services Supply SupplyChain ChainOptimization Optimization Customer Relationship Customer RelationshipMgmt Mgmt eCommerce eCommerce Shared SharedServices Services ERP Extension ERP Extension Infrastructure InfrastructureManagement Management Data Datacenter centeroperations operations Server administration Server administration&&performance performance management management 2003 Cap Gemini Ernst & Young - All rights reserved

6 CGEY’s ADM Solution: Center-Based Support Client Location Service ServiceManager Manager Management Management Service Coordination Service Coordination User UserLiaison/Business Liaison/BusinessAnalyst Analyst Requirements Gathering Requirements Gathering Problem ProblemResolution Resolution ADM Service Center Management Management Project Support Project Support Maintenance Maintenance Configuration ConfigurationManagement Management Process Documentation Process Documentation Break/fix Break/fixsupport support Testing Testing Enhancements Enhancements Applications ApplicationsTuning Tuning Minor releases Minor releases Development Development Technical Technicalsupport support Interfaces Interfaces Additional onsite CGEY staff (as needed) Additional onsite CGEY delivery sites 2003 Cap Gemini Ernst & Young - All rights reserved

0 CGEY’s Prime Integrator Is a New Approach Based on Proven Capabilities How Do We Achieve The Price Point? How Do We Achieve Successful Delivery? Proven delivery & methodology Substitution of lower cost resources for certain development activities which can be performed offshore Defined activities within each phase – requirements, design, development, test, deployment Substitution of lower cost local contracting resources to support the local team Local client/CGEY control of all aspects of the project Risk and quality management Prime Integrator Achieves both quality delivery and lower price point for mainstream systems development projects 2003 Cap Gemini Ernst & Young - All rights reserved

1 What Research Has Shown About Offshore Systems Development The current market for services delivered via offshore resource remains fairly small at less than 5% of the total IT services market (Gartner) Interest in offshore providers runs high. While 44% of the firms we spoke with engage offshore providers today, two-thirds intend to do so by 2003 (Forrester) The number of large firms using offshore providers will grow by 50% in the next two years, and offshore technology budgets will more than double (Forrester( In the “indirect approach”, pivotal providers carry out activities formerly conducted by user companies like contract negotiation and project management. Because they assume more responsibility, pivotal providers cost more than going direct but they also minimize complexity, lock in the right expertise and keep labor costs in check for user firms. By 2005, we believe 64% of firms going offshore will adopt an indirect approach (Forrester) Prime PrimeIntegrator Integratorbuilds buildssignificantly significantlyon onthe the‘indirect ‘indirectapproach’ approach’ 2003 Cap Gemini Ernst & Young - All rights reserved

The Market is Currently Segregated into Either Totally Local or Totally Offshore Projects are Complex: Low definition High complexity High volatility High velocity 2 Local Offshore Typical Projects: Package Implementations CRM ERP Billing OSS Custom Development Application Mgmt Onshore Offshore Typical Projects: Application Maintenance Application Management Testing/QA Legacy application development 100 100 0 50 50 50 30 30 70 55 95 Onshore Offshore While cost advantages move work offshore project attributes determine the team mix 2003 Cap Gemini Ernst & Young - All rights reserved Projects Delivered Inexpensive: Highly defined Low complexity Low volatility Low velocity

3 Prime Integrator Enables Mainstream Projects to be Executed by a Prorated Combination of Local and Offshore Local Typical Projects: Package Implementations CRM ERP Billing OSS Custom Development Application Mgmt Onshore Offshore Offshore Typical Projects: Application Maintenance Application Management Legacy application development 50/50 40/60 30/70 5/95 100 100 0 50 50 50 30 30 70 55 95 Onshore Offshore The proration of local versus offshore is preset into the prime integrator methodology based on project type and cannot be modified 2003 Cap Gemini Ernst & Young - All rights reserved

4 CGEY’s Prime Integrator Delivery: What Client’s Have Been Concerned About Loss of ‘control’ is resolved: by local project & technical management within the project team Loss of flexibility is resolved: by close local relationship with the client, local requirements iteration, design management, and iterative delivery & review Loss of velocity is resolved: by scheduled prototypes and direct local control Risks of greater communication flexibility is resolved: by periodic review sessions and standard status, issues and change summary Security is resolved: Project, Build and Architecture Management by hardware, software and physical location Business Continuity is resolved: by back-up recovery process and secondary facilities Capability maturity is resolved: through over 1,500 projects and over decade of prior experience 1 ASE RSW B0 Requirements RUP Methodology is a constant as in current projects B1 B2 B3 B4 Client Review ASE RSW 2 Prototype Offshore Preparation Legend Integration/Build Design Offshore 3 4 Construction Workstream #1 Local Construction Workstream #2 Projects are Complex Low definition High complexity High volatility High velocity Risk Management is resolved: by rigid quality control & review and OTACE 2003 Cap Gemini Ernst & Young - All rights reserved Mixed Construction Workstream N Test Design Test Dev Training Design Training Development Process Design Process Development Deployment Design Testing Deployment Infrastructure Management

5 Enhancements Have Been introduced Over the Last 2 Years to Assure Quality of Offshore Delivery Initial Project Assessment Client business environment Client IT Environment Project Track 1 Workplan management Lead Users Developers Integrated Tools and Methods Designers Just-in-time activity and task management Daily issues logs & resolution Exploit time difference to project advantage Project Track 1 Lead Communication Discipline Daily activity log Build reviews Onsite Project Manager Lead Lead Developers Users Testers Designers Production Support CGE&Y ADC Project, Build and Architecture Management Prime Integrator Methodology 1 Iterative approach Additional management due to geography Training and certification process Defined communications & process Prime Integrator QA Process Production Support Project Track n On-Site Initial requirements ASE’s and prototype Defined contingency points Offshore Project Manager Project Track n Video conference reviews Testers ASE RSW B0 Requirements RUP Methodology is a constant as in current projects B1 B2 B3 B4 Client Review ASE RSW 2 Prototype Offshore Preparation Legend Integration/Build Design Offshore 3 4 Construction Workstream #1 Local Construction Workstream #2 Projects are Complex Low definition High complexity High volatility High velocity Mixed Construction Workstream N Test Design Test Dev Training Design Training Development Process Design Process Development Deployment Design Testing Deployment Infrastructure Management QA Process & OTACE 2003 Cap Gemini Ernst & Young - All rights reserved

6 Distributed Delivery is an Essential Component of Productivity Savings from Off & Nearshore Offshore savings in unit cost of labor have to be considered alongside the productivity gains resulting from the accelerators and center-based delivery 50% savings The route to achieve higher savings depends on the approach 3 2 Off-shore Near-shore 1 2a Many organizations are looking to offshore first & then to improve processes and productivity (1-2-3) Others are looking to improve consistency with productivity accelerators first (1-2a-3) The prize is achieved by combining the two areas & delivering incremental savings over time (1-3) Productivity Accelerators Up to Center-based delivery RSW Reuse Methods Estimation & metrics Standard Process CMM Savings from productivity Project Management Knowledge Management 2003 Cap Gemini Ernst & Young - All rights reserved

7 Evolutionary Stages in Offshore Models The distributed Delivery Model and capabilities should be able to support stage 1 to 4 Stage 4 Persistence of Services High Low Cross Border Collaborative Services Delivery Dedicated offshore/ Stage 2 Stage 1 Onsite Contract Worker Delivery team on shore Charged hourly Managed by the onshore team Simple Onsite Project Teams Delivery team on shore Charged hourly maybe milestone fees Managed by the onshore team near shore facilities Common Stage 3 procedures, methods Pure Offshore & approaches Projects Leverages complimentary skills, capacity &/or lower Fees normally cost project based Sharing of Projects are managed by onshore organizational best practices & team Common processes intellectual capital Full collaboration and tools between teams Cost is primary Common driver development Increased transfer of intellectual capital platform(s) Two-way SLAs in place Complexity of Service Delivery 2003 Cap Gemini Ernst & Young - All rights reserved Optional Offshore Development Centers (ODC) Dedicated offshore /near shore facilities Commitment required for long term revenue stream Processes & technology infrastructure is common between ODC & the client Typically connected to client site by direct telecom link Complex

8 We will deliver excellence regardless of the manner or location in which the project is provided O n site O R ffe S m h o o te re S cop in g D e ta ile dD e sign P lan n in g D e ve lo pm e n t& T estin g B usin e ss R eq u ire m e n ts O n site O R fe fs m h o o tr e e D e sig n Q ua lity M a n a ge m e nt D e ploym e n t& T e stingS u pp o rt D e ve lo p m e n t C o nfigu ration M a in te na n ce T e stin g T rain in gC on te n t D e ve lop m en t D e plo ym e nt 2003 Cap Gemini Ernst & Young - All rights reserved

0 CGEY Offers a Full Compliment of Outsourcing and Consulting Services Strategy Integration Applications Development & Management Outsourcing Infrastructure Management IT-Enabled Business Process Management 2003 Cap Gemini Ernst & Young - All rights reserved

1 The CGEY Advantage: A Global Leader in Applications Development & Management Outsourcing is a significant focus within the CGEY organization 1.8B in revenue and growing rapidly 13,000 employees worldwide (AM & IM) Over 1,250 past and current clients Critical mass and capability in all Secure VPN 2 Mbps key geographic markets Strong presence in the Americas Paris Chicago New York 400 M in revenue with several recent Secure VPN 2 Mbps large contracts India 2,500 employees (AM & IM) An Innovator in the Market Place Secure VPN Secure VPN 2 Mbps 2Mbps 1st to market with formal Applications Management offering (late 1980’s) A unique and powerful combination of consulting and full-scope outsourcing 2003 Cap Gemini Ernst & Young - All rights reserved Singapore

2 Why CGE&Y: Differentiators First to market with formal, stand-alone Leadership AM service offer Industry analyst recognition & rankings Client references Investment Culture Industrialized AM processes Specialized AM training Diverse skills Proprietary & integrated AM toolset Global network of AM Service Centers Easy to do business with, 100% Service focus Customized contracts, living SLAs, OTACE “People matter to us” career paths, employee surveys Value system of Honesty, Boldness, Trust, Freedom, Team Spirit, Modesty, Fun Alignment Global Industry & Sector focus Industry experience on AM teams Vertical application templates (e.g.,SAP/ERPb) Delivery SLA performance results Business results testimonials OTACE ratings Contract renewals 2003 Cap Gemini Ernst & Young - All rights reserved

3 Chicago Service Center Applications Management: 120 professionals providing AM services 80 custom applications supported Supported development languages include: COBOL Java C, C , Visual Basic Natural / Adabas Smalltalk Supported Environments: Supported development and operations environments include Mainframe / CICS / DB2 Mainframe Adabas Unix / Oracle Internet (Web Logic, Vitria, .Net) Terradata Data Warehousing Customers: 7 x 24 x 365 Production Support coverage Development and Production Support teams manage applications for approximately 10 business areas within one dedicated client Telecommunications & Network: In support of client applications: Telecommunications Monitoring T1 connections to multiple networks using Cisco routers, switches and firewalls 2003 Cap Gemini Ernst & Young - All rights reserved State-of-the-Art Connectivity: 7 x 24 x 365 Operations & Monitoring Fully-integrated client development servers and workstations Backup & Recovery Systems Change Management, Escalation & other operational processes in place Infrastructure: Infrastructure as required to provide remote AM support, including: Client secured worksite with client configured workstations Laptops and mobile phones for off hour support Test and Development Servers Telecommunications

5 What Services Do We Offer? Application Development & Management Services that take contracted responsibility for any or all aspects of the maintenance, enhancement and evolution of applications systems. Application Development & Management Projects Services that are discrete. Can take responsibility for one or more aspects of the SDLC within an engagement. Staff Augmentation Services where we provide the client with temporary, high quality and low cost resources to fulfill a variety of IT needs within the SDLC, including project management. Production Support Development Test Only Projects Development Testing Staff Augmentation 2003 Cap Gemini Ernst & Young - All rights reserved Analysts Architects Developers Testers

Unique Quality Processes & Procedures Affinity Team Model 6 Associates within Affinity Teams work on projects across Sprint Application Areas Affinity Teams are self-sufficient support systems of a group of people who will work together toward a common goal in a large action. Application Projects Value Proposition Value to the Employee Create an atmosphere for excelling Provide a form for knowledge enhancement and sharing Support the career path Value to the Customer Support innovation Knowledge pool results in faster turnarounds Reduces time for training Value to the organization Improve employee satisfaction and morale Keep associated focused on skill enhancement Channel for communication Indirect feedback on employee requirements OO Affinity (LOOP) Project Management Affinity Mainframe Affinity Community Affinity Major Accomplishments OO Sponsored, contributed, & founded Smalltalk solutions Trained 23 associates through “Smalltalk Boot camp” Established board membership on Smalltalk Advisory Board Held over 15 brown bag and technical lunches Java Built Sprint specific training curriculum for beginner & intermediate n-tier developers Attained Sun Certification for 75 programmers, 16 developers, and 1 architect Trained 41 associates through “Java Boot camp” Presented at JavaOne Conference 2001 Developed & delivered EJB & Unix training curriculum Project Management Supported 21 employees through PMP certification Established presence within national PM community Established presence at PMI Seminar & Symposium 2001 Production Support Created standardized Prod. Supt. Documentation used by Sprint Performed audits of all CGEYAS Prod. Supt. projects 2003 Cap Gemini Ernst & Young - All rights reserved

7 Sprint Various business growth initiatives created a need within Sprint’s Long Distance Division to rapidly expand its software development and production support and testing capacity by engaging the services of an outside supplier. A primary component of this engagement was to free up key resources to focus on Sprint’s core competencies Sector Telecommunications, Media & Network Deal Type Applications Development and Management Geography North America Structure Outsourcing Duration 6 years Start Date June 1999 Total Revenue 500 Million Solutions and Benefits to Client CGE&Y provides software development, systems analysis, systems design, production support, testing and related software services and associated deliverables in connection with certain software development and Production Support projects CGE&Y established, and is delivering to, mutually agreed service levels for all aspects of the engagement The successful transition of applications and the consistent delivery have provided Sprint the ability to reposition its own critical resources to pursue strategic projects within its core competency Additionally, access to special skills at CGE&Y supports transformation of the enterprise providing less risk, greater benefit, and higher speed to market. Sprint recognized CGE&Y as an extension of its organization 2003 Cap Gemini Ernst & Young - All rights reserved

June 26, 2024

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