Michael Goldsworthy – Customer-Centric Governance, Cashflow-Centric Governance

Status: Final Version: Master 8 August 2018 © 2018 Australian
Strategic Services Pty Ltd Customer-centric Governance, Cashflow-centric Governance… Better Boards Conference Saturday, 11 August 2018 10.30 am – 11.30 am …Customers Are King, Cashflow Is Queen

2 Status: Final | Version: Master | 8 August 2018
| © 2018 Australian Strategic Services Pty Ltd Customer-centric Governance, Cashflow-centric Governance…Customers Are King, Cashflow Is Queen Contents u Section One: Presentation Acknowledgements & Objectives u Section Two: The Principles & Practices Of Customer-centric Governance u Section Three: The Principles & Practices Of Cashflow-centric Governance u Resources Articles, Presentations, Tools & Further Information

| © 2018 Australian Strategic Services Pty Ltd Customer-centric Governance, Cashflow-centric Governance…Customers Are King, Cashflow Is Queen Acknowledgements u In presenting this information I acknowledge that: * directors and chief executive officers either have commenced, are in the process of, or need to commence transforming their organisation, re-engineering their business model and reinventing their culture * each board and chief executive officer and their respective organisation operates within different frameworks and processes, guided by relevant legislation/regulations, standards/accreditations, contracts/service agreements and legal entities/constitutions, vision/philosophy, strategy/ business model etc * the journey of strategically transforming one’s organisation will vary from one board and chief executive officer to another because each organisation’s uniqueness.

| © 2018 Australian Strategic Services Pty Ltd Customer-centric Governance, Cashflow-centric Governance…Customers Are King, Cashflow Is Queen Presentation Objectives u To enhance your understanding of customer-centric governance and cashflow- centric governance. u To strengthen your appreciation and practical application of these principles and practices with the aim of ensuring your board continues to govern and lead a successful and financially sustainable organisation into the future. u To provide you with practical, easy to apply concepts, principles, strategies, documents or tools that will assist your board to develop and grow the organisation in the new customer-driven, competitive marketplace. u To provide the opportunity to engage in group discussion, to exchange ideas and opportunities and to make new contacts or catchup with colleagues.

| © 2018 Australian Strategic Services Pty Ltd Customer-centric Governance, Cashflow-centric Governance…Customers Are King, Cashflow Is Queen Section Two…The Principles & Practices of Customer-centric Governance

| © 2018 Australian Strategic Services Pty Ltd Customer-centric Governance, Cashflow-centric Governance…Customers Are King, Cashflow Is Queen Principle 1: The Customer-driven, Competitive Market Paradigm u The majority of community businesses (NFPs), in particular those funded by government, no matter what industry or sector they are part of, now operate in a customer-driven, competitive marketplace. u Operating in a market paradigm is radically different from operating in the government funded welfare paradigm 1950 2000/18 2025/30 Government Funded, Welfare Paradigm Charitable Paradigm Environmental, Social & Economic Paradigm Customer-driven, Competitive Market Paradigm © ASSPL 1950 2000/18 2025/30 ” if your organisation has not commenced this journey a transformational journey will need to be undertaken”

| © 2018 Australian Strategic Services Pty Ltd Customer-centric Governance, Cashflow-centric Governance…Customers Are King, Cashflow Is Queen Principle 2: Industry Key Drivers, Reshape Your Organisation u An increasing number of individual directors and boards are coming to grips with the industry key drivers that are reshaping their organisation and the industry in which they operate, eg: specific legislation changes, policies, new funding models etc. u Note: Industry key drivers are different from an organisation’s key drivers. Eg: Residential Aged Care Deregulation Of Industry New Standards Consumer Choice & Control New Funding Model No Bed Licences Zero Tolerance To Non-compliance © ASSPL ”industry key drivers reshape industries, but more particularly force organisations within an industry to re-engineer their business models”

| © 2018 Australian Strategic Services Pty Ltd Customer-centric Governance, Cashflow-centric Governance…Customers Are King, Cashflow Is Queen Principle 3: Enact Your Governance Roles & Responsibilities In a nutshell, all boards have two key governance roles: u Firstly, act in the best interests of the company, the organisation u Secondly, act in the best interest of all internal and key external stakeholders; not just the clients, patients, residents, consumers etc. u Note: do not confuse your vision or mission statements with your governance roles. Firstly, Act In The Best Interests Of The Company/ Organisation Secondly, Act In The Best Interests Of All Internal & Key External Stakeholders © ASSPL ”in essence, at all costs secure the boat, the organisation, thereby securing the people, the customers & stakeholders”

| © 2018 Australian Strategic Services Pty Ltd Customer-centric Governance, Cashflow-centric Governance…Customers Are King, Cashflow Is Queen Principle 3: Enact Your Governance Roles & Responsibilities The four key governance responsibilities of boards can be summarised as: u Strategic leadership; proactive u Policy based decisions; proactive u Compliance and coverage; reactive u Monitoring and review; reactive Firstly, Act In The Best Interests Of The Company/ Organisation Secondly, Act In The Best Interests Of All Internal & Key External Stakeholders © ASSPL Strategic Leadership M onitoring & Review Compliance & Coverage Policy Based Decisions ”proactive boards spend 75%–80%” of their time undertaking strategic leadership activities and making policy based decisions”

| © 2018 Australian Strategic Services Pty Ltd Customer-centric Governance, Cashflow-centric Governance…Customers Are King, Cashflow Is Queen Principle 4: Use A Contemporary Governance System u Many boards have transitioned or are transitioning to a comprehensive governance system, therein governance principles, policies, procedures, documents and tools, eg: TAGS™, The Australian Governance System: * 8 governance principles * 69 governance policies & procedures * 100+ documents and tools u An integrated governance system should include a range of customer governance policies and procedures, documents and tools. TAGS™ 3.1 Acting In The Best Interests of Stakeholders Policy TAGS™ 4.7 Board & Customer Relationship Policy TAGS™ 6.8 Customer Management System Policy TAGS™ 1.6 Duty of Skill & Care Policy TAGS™ 5.14 Clinical Governance Framework & Process Policy TAGS™ 7.1 Balancing & Integrating Business & Service Objectives & Outcomes Policy TAGS™ 7.3 Products & Services Development Policy ”governance manuals & similar approaches are not contemporary, e-boardrooms & governance systems are”

| © 2018 Australian Strategic Services Pty Ltd Customer-centric Governance, Cashflow-centric Governance…Customers Are King, Cashflow Is Queen Principle 5: Customer Is King, Cashflow Is Queen u For all community businesses which receive government funding, the move to a customer-driven, competitive marketplace has meant: * a move from being “funded in advance and acquitting in arrears” * “earning money and invoicing in arrears”. u Engaging and re-educating staff and managers on this new approach. Customer Is King Cashf low Is Queen “Funded In Advance & Acquitting In Arrears” “Earning Money & Invoicing In Arrears” © ASSPL ”secure the customers, secure the cashflow”

| © 2018 Australian Strategic Services Pty Ltd Customer-centric Governance, Cashflow-centric Governance…Customers Are King, Cashflow Is Queen Principle 6: Create A Powerful Organisational Platform u Concise and aligned vision, mission, values, philosophy and core business statements create a powerful organisational platform and the basis of: * individual, team and organisational customer attitudes, behaviours and work practices. * a customer-centric culture, a customer-centric framework. Vision Statement Mission Statement Values Statement Philosophy Statement Core Business Statement © ASSPL ”culture eats strategy for breakfast; people’s passion drives the purpose & delivers the performance”

| © 2018 Australian Strategic Services Pty Ltd Customer-centric Governance, Cashflow-centric Governance…Customers Are King, Cashflow Is Queen Principle 7: A Customer Framework, A Customer Pathway u Designing and developing a customer framework supports the connection between: * the board’s governance customer policies and procedures, and * the organisation’s customer policies and procedures. Both approaches create an end-to-end customer pathway. Customer… Eg: Resident, Client, Consumer, Patient, Supported Employee, etc. Customer Requirements Customer Experience Customer Outcomes Customer Journey © ASSPL ”a customer framework creates an end-to-end customer pathway which should be supported by governance & organisational customer policies & procedures”

| © 2018 Australian Strategic Services Pty Ltd Customer-centric Governance, Cashflow-centric Governance…Customers Are King, Cashflow Is Queen Principle 8: Create Lifetime Service Relationships u Creating and enhancing lifetime service relationships between customers and/or with their partners, friends or family and the organisation, forms the basis of: * repeat business * referral business * a relationship through which solid engagement and communication can occur. Referral Busi ness Referral Business Referral Business Repeat Busin ess Repeat Business Repeat Business Customer…Partner, Friends or Family © ASSPL ”repeat business & referral business are the best form of business…no marketing costs, no marketing worries, customers just arrive”

| © 2018 Australian Strategic Services Pty Ltd Customer-centric Governance, Cashflow-centric Governance…Customers Are King, Cashflow Is Queen Principle 9: Customer-centric Business Model & Strategies u Co-designing and implementing a customer-centric business model and associated strategies should propel the development and growth of individualised or customised services or products. u Such an approach is pivotal in the journey of transforming the organisation, re-engineering the business model and reinventing the culture of an organisation. ACFI, Home Care, Public Trustee, Tenders & Grants B2C: Eg: Deferred Mgt Fees, Fee-for Service, Rental Income, Other Market Channels: E g: Donations, Sponsorships, Clinical Placement, Co ntracts, Joint Ventures G2B: Eg: State & C’wlth Govern ments, Primary Health Networks, Aged, Wellness & Retired Peo ple, Residential & Home Care, Fundraising, Bequests, Parnter ships, Alliances, Joint Ventures B2B: Eg: Brokerage, Partner ships, Private Health Insurance, Improving The Health, Lifestyle & Wellbeing Of People Who Are Ageing With Emerging Or Actual Chronic Or Complex Health Challenges Ageing People People Transitioning Peo ple with Dementia People With Chron ic/ Complex Health People Rehabilitating End of Life People Palliating Or Reside ntial Care Services Retirement Living Services Allied, Primary Health & Medical Services Allied, Primary Health & Medical Services © ASSPL Home Care Services Lifestyle Living & Supp ort Services Pr ofessional Development Progra m R egistered Training Organisatio n Partnership Project Chief Executive Officer, Executives & Managers Board of Directors Managers, Staff & Volunteers Example Business Model ”create a new business model for a new paradigm; an old business model cannot operate in a new paradigm”

| © 2018 Australian Strategic Services Pty Ltd Customer-centric Governance, Cashflow-centric Governance…Customers Are King, Cashflow Is Queen Principle 10: Customer Metrics, The Key To Performance u Customer metrics go well beyond just customer satisfaction survey results. u A board’s understanding and use of an organisational performance management system is critical if they are to proactively monitor and drive the organisation’s performance, therein customer metrics. Metric Category Board Customer Metrics Customers u Service level provision occupancy u Number of billable hours/ utilisation rates per day u Hours of engagement/year u Number of new, existing & repeat customers/month u Average $ spend per customer, per week/month u Number of customer complaints per month ”measure what matters, customer engagement, experience & outcomes”

| © 2018 Australian Strategic Services Pty Ltd Customer-centric Governance, Cashflow-centric Governance…Customers Are King, Cashflow Is Queen Practices For Customer-centric Governance For boards and chief executive officers to truly develop and drive a customer-centric culture, they may wish to consider: u interpreting and enacting the previously presented ten customer-centric principles u reviewing the provided articles, presentations and tools u investigating and/or enacting the following governance practices, pages 19–28.

| © 2018 Australian Strategic Services Pty Ltd Customer-centric Governance, Cashflow-centric Governance…Customers Are King, Cashflow Is Queen Practice 1: Understand Customer Interaction Through Their Eyes u Technology has given customers unprecedented power to dictate the rules in purchasing services and products. u McKinsey research finds 3/4 of customers expect “now service” with five minutes of online contact with an organisation. u Customers also expect all organisations to provide the same levels of immediacy, personalisation and convenience as they receive from leading organisations. u Therefore, boards should determine whether they are a leading, following or resisting organisation.

| © 2018 Australian Strategic Services Pty Ltd Customer-centric Governance, Cashflow-centric Governance…Customers Are King, Cashflow Is Queen Practice 2: Identify, Understand & Map The Customer Journey u Leading organisations optimise customer journeys, not just organisational/service touch points, eg: registration, service appointments. u Customer-centric organisations provide “end-to-end experiences”, not touch points, such as register, charge, account, delivery of service, etc. u Identifying, understanding and physically mapping the customer’s journey, including the touch points enables the board, chief executive officer, executives, managers and staff to improve both the customer journey and the customer experience. Web Contact Example Meeting or Call Confirming Letter Service Notification Service Delivery Welcome Confirmation Service Requirements Follow Up Follow Up Telephone Discussion Customer Journey Customer Experience © ASSPL

| © 2018 Australian Strategic Services Pty Ltd Customer-centric Governance, Cashflow-centric Governance…Customers Are King, Cashflow Is Queen Practice 3: Quantify What Matters To Your Customers u Customers of human service organisations have high to very high standards for such areas as service quality, safety, performance and increasingly price, particularly given the cost of services is being extracted from their individualised budget. u Therefore, boards and chief executive officers, together with executives, really need to not only understand their customer’s expectations, requirements and needs, but quantify what really matters to their customers. u There is no doubt that customer service contracts, care plans and similar documents that are put in place create the framework/relational requirements and deliverables between a customer and an organisation and they help quantify what really matters to the customer. u Customer requirements and expectations are one thing, customer complaints, reporting an organisation to a government authority or department or initiating legal proceedings are another; such customer responses are extremely costly.

| © 2018 Australian Strategic Services Pty Ltd Customer-centric Governance, Cashflow-centric Governance…Customers Are King, Cashflow Is Queen Practice 4: Reinvent Customer Journeys Via Digital Technologies u Business models that are nominally supported by various digital technologies or solutions is one approach. u However, several boards, chief executive officers and executives have been able to completely transform their organisation, re-engineer their business model and reinvent their culture into a comprehensive digital platform, completely digitising their organisation, its businesses and services, eg: Care Connect.

| © 2018 Australian Strategic Services Pty Ltd Customer-centric Governance, Cashflow-centric Governance…Customers Are King, Cashflow Is Queen Practice 5: Take A Deep Dive To Understand Your Culture u Whilst board’s wrap their hands around the business as they govern, they must also understand what’s happening in the business…without putting their hands in the business; which can be a challenge! u Via the chief executive and executives it is critical that the board understands the realities of the culture; that is the attitudes, behaviours, characteristics and work practices of key individuals, teams and the organisation. u Diving deep into your culture is step one in forming a customer-centric culture. Board Cultural Strategies u Observe, not just see u Listen, not just hear u Walk the floor; observe for yourself, listen to staff u Initiative independent cultural assessments u Analyse customer data & feedback, become a customer u Ask insightful & pertinent questions u Pursue lines of enquiry u Remain objective, put aside the emotional engagement & ownership

| © 2018 Australian Strategic Services Pty Ltd Customer-centric Governance, Cashflow-centric Governance…Customers Are King, Cashflow Is Queen Practice 6: Embed Your Vision, Mission, Values & Philosophy u Inculturation = * engaging and educating staff in the vision, mission, values and philosophy * reinforcing the vision, mission, values and philosophy through case studies, awards, training, customer stories, etc * enabling easy access to the relevant policies and procedures directly aligned to people’s jobs * understanding customer categories/types, markets and sub-markets, requirements and characteristics. u Balancing cultural and customer dynamics can be a challenge, one wobble and ………!. Repeat Business Dissatisfied Referral Business Distraught Brand Champion Destructive Advocate Dynamite Your Customer… Partner, Family & Friends Individual, Team & Organisational Attitudes, Behaviours, Characteristics & Work Practices Your Organisation’s Legal Entity, Constitution & Governance System Core Business Vision Philosophy Mission Values © ASSPL

| © 2018 Australian Strategic Services Pty Ltd Customer-centric Governance, Cashflow-centric Governance…Customers Are King, Cashflow Is Queen Practice 7: The Customer & Organisational Relationship u The customer and staff relationship is a symbiotic relationship, a challenging relationship to manage. u Customer = eg: * hear my story * understand my expectations, requirements and needs * deliver on time, to a standard, to a price * support me in my journey etc. u Staff = eg: * listening and assessing * co-designing a service response * building a professional relationship, etc. © ASSPL Organisational Resources, Capacity & Capability Customer Expectations, Requirements & Needs Staff & Organisational Dimensions & Dyn amics Customer Dimensions & Dynamics

| © 2018 Australian Strategic Services Pty Ltd Customer-centric Governance, Cashflow-centric Governance…Customers Are King, Cashflow Is Queen Practice 8: Align Structure & Position To Strategy & Projects u Boards provide resources, be they financial resources, human resources, capital etc, eg: board decisions, signing off budgets and loans, purchasing property, signing/ authorising contracts and leases, etc. u Boards put in place strategic plans, therein strategies to enact projects…typically there is a resistance/reluctance to restructuring the organisation, creating/recreating positions, even though the strategy/ies demand such an approach. u Alignment of strategy and structure is crucial. Strategic Plan Strategies Managers & Staff Strategy & Structure Alignment Strategy & Structure Alignment Customers Projects Organisational Structure & Positions Project Costs Structural Costs © ASSPL

| © 2018 Australian Strategic Services Pty Ltd Customer-centric Governance, Cashflow-centric Governance…Customers Are King, Cashflow Is Queen Practice 9: Adopt A Co-designed Customer Journey u Understand the customer and market expectations, requirements and needs…develop customer intelligence. u Draw inspiration, ideas and innovations from other industries…gain strategic insights. u Get a glimpse of what’s on the horizon…look to the future. u Empower and resource multi-disciplinary teams… understand the customer journey touch points. u Create a new business model and adopt technology…use agile techniques. Develop Customer Intelligence Gain Strategic Insights Understand the Customer Journey & Touch Points Look To The Future Use Agile Techniques © ASSPL

| © 2018 Australian Strategic Services Pty Ltd Customer-centric Governance, Cashflow-centric Governance…Customers Are King, Cashflow Is Queen Practice 10: Trade On The Customer Story u With permission, lifetime service relationships with customers provide the opportunity to provide powerful case studies, or stories with key messages to existing, new or potential customers. u There are may ways to unlock the potential of these case studies and stories…creativity is the name of the game, eg: research paper, conference paper, webinar etc.

| © 2018 Australian Strategic Services Pty Ltd Customer-centric Governance, Cashflow-centric Governance…Customers Are King, Cashflow Is Queen Section Three…The Principles & Practices of Cashflow-centric Governance

| © 2018 Australian Strategic Services Pty Ltd Customer-centric Governance, Cashflow-centric Governance…Customers Are King, Cashflow Is Queen Principle 1: Business & Service Objectives & Outcomes u Community businesses (NFPs) are driven by vision/mission and deliver various social, environmental or community dividends. u Balancing and integrating business (cashflow) objectives and outcomes with service (customer) objectives and outcomes is proving to be a significant challenge for many boards and chief executive officers. u Transitioning community businesses to operate in a customer-driven, competitive marketplaces, many of which are or will be “deregulated” is paramount if an organisation is to ensure its future success. © ASSPL Balancing & Integrating Business Objectives & O utcomes Balancing & Integrating Service Objectives & Outcomes © ASSPL Cashflow Management Customer Management

| © 2018 Australian Strategic Services Pty Ltd Customer-centric Governance, Cashflow-centric Governance…Customers Are King, Cashflow Is Queen Principle 2: Annual Budgets Are Just “A Shopping List” u Annual budgets are typically just “a shopping list” of what a board/organisation expects to earn in revenue and expects to spend in expenses. u Annual budgets are typically static and are poorly constructed; with little robust research and analysis of actual/projected finances and the all important underlying key drivers, assumptions and parameters of the industry or business being understood or accounted for in the budget. u In the past paradigm of being “funded in advance and accounting for acquittals in arrears” annual budgets on their own were adequate. u However, in today and tomorrow’s world of attracting and retaining customers, then delivering services, after which invoices will be sent and payments received is another matter.

| © 2018 Australian Strategic Services Pty Ltd Customer-centric Governance, Cashflow-centric Governance…Customers Are King, Cashflow Is Queen Principle 3: Customers = Cashflow u In the past boards of community businesses were typically concerned with: * profit and loss statements * occasionally, projected profit and loss * annually, the balance sheet results rather than trends. u Today, whilst these financial tools and processes are very important, they should not be the primary focus…projecting, monitoring and managing cashflow is the name of the game. Projecting, Managing & Monitoring Profit & Loss Statements & Metrics STEP 2 Projecting, Managing & Monitoring Cashflow Statements & Metrics STEP 1 Projecting, Managing & Monitoring The Balance Sheet & Metrics STEP 3 © ASSPL

| © 2018 Australian Strategic Services Pty Ltd Customer-centric Governance, Cashflow-centric Governance…Customers Are King, Cashflow Is Queen Principle 4: Financial Model Reflects The Business Model u A comprehensive and dynamic financial model should incorporate your new business model and: * industry and organisational key drivers * business assumptions, parameters and rules * business and organisational metrics * comparisons to industry benchmarks. u A financial model stands alone, but should be aligned to your organisation’s financial system. Your New Business Model © ASSPL Your New Financial Model Your New Financial Model Comp arisons To Organisation al Metrics Parameters & Rules Industry & Organisational Industry Benchmarks Busines s & Business Assu mptions, Ke y Drivers

| © 2018 Australian Strategic Services Pty Ltd Customer-centric Governance, Cashflow-centric Governance…Customers Are King, Cashflow Is Queen Principle 5: Industry & Organisational Key Drivers u Identifying and understanding the typical 5–7 industry key drivers that are forcing the reshaping of your organisation whether they are actual, emerging or future key drivers is paramount, eg: new standards, new funding model. u The same applies for an organisation’s key drivers, eg: customer category profile/s such as number of high care– sub-acute care customers equals X revenue, alternatively a high number of low–high care customers only equals Y revenue. Your New Business Model © ASSPL Your New Financial Model Your New Financial Model Industry Key Drivers Organisational Key Drivers

| © 2018 Australian Strategic Services Pty Ltd Customer-centric Governance, Cashflow-centric Governance…Customers Are King, Cashflow Is Queen Principle 6: Customer Categories, Mix, Value & Flow Rates u In a customer-centric, competitive marketplace, boards must come to grips with the financial impacts and implications of various strategic or organisational scenarios and options based on: * customer categories * customer mix * customer value * customer flow rates. The interplay of these elements will categorically determine revenue flows. Customer Categories Customer Flow Rates Customer Value © ASSPL Business Model Customer Mix Financial Model

| © 2018 Australian Strategic Services Pty Ltd Customer-centric Governance, Cashflow-centric Governance…Customers Are King, Cashflow Is Queen Principle 7: Concise Metrics, Snapshot Reports u Determine the key financial metrics of your new business model and incorporate them into your financial model. u Monitoring the financial performance of your new business model is best done against robust financial metrics: * cashflow metrics * profit and loss metrics * balance sheet metrics. Typical Financial Metrics Cashflow Metrics, eg: u bank balance u revenue per month Profit & Loss Metrics, eg: u actual to projected u corporate to labour ratio Balance Sheet Metrics, eg: u net assets u EBITA

| © 2018 Australian Strategic Services Pty Ltd Customer-centric Governance, Cashflow-centric Governance…Customers Are King, Cashflow Is Queen Principle 8: Concise Metrics, Snapshot Reports u A board’s annual professional development plan should account for the strengthening of directors’ financial knowledge, particularly those non- financially qualified or experienced directors. u Understanding, analysing and utilising cashflow, profit and loss and balance sheet data/statements is fundamental to discussion and decision about the business model and the organisation’s performance, including its financial performance.

| © 2018 Australian Strategic Services Pty Ltd Customer-centric Governance, Cashflow-centric Governance…Customers Are King, Cashflow Is Queen Principle 9: Shift The Focus To Proactive Financial Modelling u Typically 65%–75% of a board’s time in the boardroom is spent on the past… reviewing and monitoring past financials, past events and past performance; such behaviour is recorded in a board’s minutes. u Shift your board’s focus and work to: * 65%–75% on the emergent future strategies and projects * 35%–25% on the past and the current performance. Policy Based Decision Work Compliance & Coverage Work Monitoring & Reviewing Work Strategic Leadership Work ReactiveBoard Work Proactive Board Work © ASSPL

| © 2018 Australian Strategic Services Pty Ltd Customer-centric Governance, Cashflow-centric Governance…Customers Are King, Cashflow Is Queen Principle 10: Embed Strategies/Projects Into Financial Model Strategic Plan Business Financial M & Reporti Business Model Generally An Annual Budget Rarely A Strategic Financial Management Plan Usually A Strategic Plan “Poor Metrics”, Average Reporting © ASSPL Strategic Plan Business & Financial Metrics & Reporting Business Model Financial Model © ASSPL ally An Budget egic Financial ment Plan rategic Plan “Poor Metrics”, Average Reporting © ASSPL u Past Ways, A Siloed Approach u New Ways, An Integrated Approach

| © 2018 Australian Strategic Services Pty Ltd Customer-centric Governance, Cashflow-centric Governance…Customers Are King, Cashflow Is Queen Practices 1– 10: In A Nutshell, There’s Just One Message u Develop or obtain a robust, proven financial modelling tool, constructed for your industry and the specifics of your organisation, eg: Logic Advisory Services. u Develop, with or without assistance from specialist financial modelling advisors, a comprehensive integrated financial model. u Incorporate all of your organisation’s current financials, the key drivers and metrics and produce projected cashflow and profit and loss statements and balance sheets that are underpinned by the actual assumptions, rules and parameters of your new business model, and then incorporate and use the metrics and compare the results to industry benchmarks.

| © 2018 Australian Strategic Services Pty Ltd Customer-centric Governance, Cashflow-centric Governance…Customers Are King, Cashflow Is Queen Section Four…Articles, Presentations, Tools & Further Information

| © 2018 Australian Strategic Services Pty Ltd Customer-centric Governance, Cashflow-centric Governance…Customers Are King, Cashflow Is Queen Tools To Re-engineer Your Business Model, Transform Your Culture, Reinvent Your Organisation The following tools can be provided to you by email: u Achievements, Disappointments & Ideas Tool u Current Business Model Tool u Future Business Model Tool u Strategic Transformation Project Implementation Tool u The Board/Executive Comparison Tool…How Do We Compare Against Our Peers & The Market? Strictly Private and Commercially Confidential Version: 1.0 | Copyright © 2015 Australian Strategic Services Pty Ltd. Usage of this document is governed by the licence & copyright agreement found at http://www.asspl.com.au/agreement Removal of this copyright notice violates the terms of the licence & copyright agreement. Ref: MG:BH Date: 13 October 2015 Licence No: Lic Number Organisation’s Logo Organisation’s Name Strategy Stress Test Tool This tool has been developed by Australian Strategic Services based on the Article titled “Have you tested your strategy lately? Published in the McKinsey Quarterly 2015 Strictly Private & Commercially Confidential Version: 1.0 | Copyright © 2015 Australian Strategic Services Pty Ltd. Usage of this document is governed by the licence & copyright agreement found at http://www.asspl.com.au/agreement Removal of this copyright notice violates the terms of the licence & copyright agreement. Ref: MG:BH Date: 13 October 2015 Licence No: Lic Number Organisation’s Logo Organisation’s Name The Board/Executive Comparison Tool… How Do We Compare Against Our Peers & The Market?

| © 2018 Australian Strategic Services Pty Ltd Customer-centric Governance, Cashflow-centric Governance…Customers Are King, Cashflow Is Queen Strictly Private and Commercially Confidential Version: 1.0 | Copyright © 2018 Australian Strategic Services Pty Ltd. Usage of this document is governed by the licence & copyright agreement found at http://www.asspl.com.au/agreement Removal of this copyright notice violates the terms of the licence & copyright agreement. Ref: MG:MT Date: 6 August 2018 Licence No: Lic Number Organisation’s Logo Organisation’s Name Strategic Transformation Project Working Group Terms of Reference Note: This document is provided in a pdf format… if a MSWord version is required please email or telephone Barb on [email protected] or 03 5429 6331 Tools To Re-engineer Your Business Model, Transform Your Culture, Reinvent Your Organisation The following tools can be provided to you by email (con’t): u Strategic Transformation Project Action List u Strategic Transformation Project Contact List u Strategic Transformation Project GANTT Chart u Strategic Transformation Project Status Report u Strategic Transformation Project Working Group Terms of Reference u Stress Test Tool (Part 1 & Part 2) u Systems Review Tool

| © 2018 Australian Strategic Services Pty Ltd Customer-centric Governance, Cashflow-centric Governance…Customers Are King, Cashflow Is Queen What Resources Are Available? TAGS™, The Australian Governance System: An overview of TAGS™: http://asspl.com.au/solution/australian-governance- system/ The TAGS™ Presentation: http://asspl.com.au/presentation/tags-the- australian-governance-system-the-four-steps-to-boards-governing-managers- managing/ Winning hearts and minds in the 21st century: http://www.mckinsey.com/ business-functions/organization/our-insights/winning-hearts-and-minds-in-the- 21st-century Transformation with a capital T: http://www.mckinsey.com/business-functions/ mckinsey-recovery-and-transformation-services/our-insights/transformation- with-a-capital-t

| © 2018 Australian Strategic Services Pty Ltd Customer-centric Governance, Cashflow-centric Governance…Customers Are King, Cashflow Is Queen What Resources Are Available? The role of the chief transformation officer: http://www.mckinsey.com/ business-functions/mckinsey-recovery-and-transformation-services/our- insights/the-role-of-the-chief-transformation-officer The expanding role of design in creating an end-to-end customer experience: http://www.mckinsey.com/business-functions/operations/our- insights/the-expanding-role-of-design-in-creating-an-end-to-end-customer- experience The CEO’s role in leading transformation: http://www.mckinsey.com/ business-functions/organization/our-insights/the-ceos-role-in-leading- transformation Reorganization without tears: http://www.mckinsey.com/business-functions/ organization/our-insights/reorganization-without-tears

| © 2018 Australian Strategic Services Pty Ltd Customer-centric Governance, Cashflow-centric Governance…Customers Are King, Cashflow Is Queen What Resources Are Available? How to start building your next-generation operating model: http://www. mckinsey.com/business-functions/digital-mckinsey/our-insights/how-to-start- building-your-next-generation-operating-model Disrupt or Be Disrupted…The Six Leadership Challenges of the New Customer-Driven Competitive Marketplace: http://betterboards.net/ leadership/disrupt-disruptedthe-leadership-challenges-customerdriven- competitive-marketplace/ Disrupting beliefs: A new approach to business-model innovation: http://www. mckinsey.com/business-functions/strategy-and-corporate-finance/our-insights/ disrupting-beliefs-a-new-approach-to-business-model-innovation Customer-Centric Governance… Customer is King, Cashflow is Queen: https://betterboards.net/governance/customer-centric-governance/

| © 2018 Australian Strategic Services Pty Ltd Customer-centric Governance, Cashflow-centric Governance…Customers Are King, Cashflow Is Queen Strategy…The Key Domain of Directors, Chief Executive Officers & Senior Managers Disrupt or Be Disrupted…The Six Leadership Challenges of the New Customer-Driven Competitive Marketplace Adaptive Governance…Transformational Leadership Customer-Centric Governance… Customer is King, Cashflow is Queen Articles available from Australian Strategic Services [email protected] What Resources Are Available?

| © 2018 Australian Strategic Services Pty Ltd Customer-centric Governance, Cashflow-centric Governance…Customers Are King, Cashflow Is Queen Further Information For additional governance or strategic transformational presentations or resources, or to discuss your board’s requirements contact: Michael Goldsworthy Principal Consultant Australian Strategic Services 03 5429 6331/0418 130 581 [email protected] www.asspl.com.au For Better Boards conference, seminars, resources, articles, bookstore, newsletter and BoardWise enquiries contact: Julia Duffy Researcher Better Boards Australasia 03 5429 3786 info@betterboards www.betterboards.net

Michael Goldsworthy – Customer-Centric Governance, Cashflow-Centric Governance

Michael Goldsworthy – Customer-Centric Governance, Cashflow-Centric Governance

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