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Why Business Transformation?

• We are doing well, but we can do better• Alignment—internally and with sales leaders• Focus our resources on growth initiatives

Pharmanex — S2, g3, LifePak nano Nu Skin — ProDerm Big Planet — Photomax Geographic Investments

• Identify, create and sustain competitive advantages • Simplify

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2

Business Transformation

• Not all work is created equal

• Left unabated, compliance and business essential work overwhelms the more important competitive and competitive enabling work

Competitive process

Competitive enabling process

Business essential process

Non-essential process

Compliance

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4 Core Business Processes

Competitive process Business essential processCompetitive enabling process

Strategy Development

Product DevelopmentDemand Creation (Distributor Success)

Supply Chain

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Great Companies Choose One Core Process Where Competitive Work is Done

• Product Development – Apple / Intel• Demand Creation – Nike / Starbucks

• Supply Chain – WalMart• Strategy – Berkshire Hathaway

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Strategy Development

• What is our strategic intent?

• What will we do differently than all of our competitors?

Strategic Intent

Strategic Means

Strategic Action

Resource Allocation

and Execution

Strategy Making and Plan Process — two to five years

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Pro

duct

Opp

ortu

nity

Cul

ture

Our Community -

A better way of life

Nu Skin Enterprises - Pillars of Success6

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Characteristics of our Opportunity

Historically:• Leadership focused• Generous comp plan• Global/Seamless

Today:• Distinct product brands, plus

Q: What do we do differently (competitive advantage)?

A: We will become best at developing successful leaders

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Characteristics of our Products• Innovative• Premium Quality• Proprietary• Product Integrity — Substantiation• All of the good, none of the bad

Q: What do we do differently (competitive advantage)?

A: “The Measurable Difference”A: We apply a higher level of technology to each of

our product categories: Scanner, ProDerm, Photomax

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Characteristics of our Culture

• Force for Good• Integrity• Fun• Encourage our partners to make a difference in the

world

Q: What do we do differently (competitive advantage)?

A: Nourish the Children: Force for good baked into the business model

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Distributor Success Process

• Our most important asset is our distributor partners; therefore, this is our most critical process and where our major competitive work takes place

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Distributor Success Process

Consumption& Duplication

SponsoringLeadership

Development

Trained Distributor (with 100 pts)

Successful Distributor(active, sponsoring, duplicating, advancing)

Retained Distributor Consuming and Duplicating (sponsored 3 active distributors)

Active Consumer (ordering every 3 months)

Consumption

Engaged consumer (who places the 1st

order)

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Three Competitive Components of the Distributor Success Process

• Sponsoring

• Consumption/Retention

• Leadership Development

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Sponsoring

• Ensure opportunity creates demand

• Focus on easy, frictionless signup process

• Ensure process to qualify for commissions is clear, simple and standardized

• Create an amazing support experience for a new distributor

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Consumption/Retention

• Provide a consistent focus on retention of both consumers and distributors

• Provide partners with tools necessary to immediately begin the business duplication process

• Create incredible first experiences (first check, first order, etc.)

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Leadership Development

• Focus our time and resources on the most valuable stage of your business; leadership advancement, leadership skills and recognition

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DSP Strategies

DistributorSuccessStrategies

• Execute: simple story effectively communicated

• Implement frictionless sign-up process

• Develop and implement DRM programs

• Align core global programs (ARO, Scanner etc)

• Implement aligned technology strategy

• Introduce success roadmap

• Develop and execute leadership programs

• Make culture pervasive throughout organization

• Implement global recognition standards

Eliminate sign-up barriers

Strengthen consumption and duplication processes

Improve leadershipeffectiveness

Core Strategies Key Tactics/Actions

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Overall Conclusion

While each NSE market may require localized business strategies, there are core overarching Distributor Success Processes that apply to all markets…

Identifying and implementing these core and enabling processes will result in growth and savings

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Product Development (PD) Core Processunique distinctive brands

Ideation Design/Product Story

Formulate & Testing

Development Manufacturing LaunchProduct

Management

Viable innovativeproduct idea

Business caseproduct concept

Preliminaryformula

Final productSpecifications –Product integrity

and quality

Productinventory

Incrementalrevenue

Brand growth&

Improved profits

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• Developing innovative products to drive the business opportunity• Number of scientists (including external thought leaders) in Multi Disciplinary teams to discover products with a measurable difference

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CorporateDevelopment

Jack Peterson

CEOTruman Hunt

ProductDevelopment

Joe Chang

DistributorSuccess

Dan Chard

Finance

Ritch Wood

HumanResources

Claire Averett

Legal

Matt Dorny

Growth Opps Sponsoring Acquisitions Big Planet

Nu Skin PDPharmanex PDProduct MgmtSupply Chain

Geographic Mgmt.Sponsoring/Reten/Leadership DevDistributor TrainingCompensation PlanProduct Mktg/SalesRecognitionEventsCreative ServicesNew Markets

FinanceITAdministration

Business TransEmployee EventsFFG Culture

Gov’t RelationsDistrib DisciplineDistrib. Policies& Procedures

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Distributor Success

Dan Chard

Americasand Europe

Scott Schwerdt

North Asia

Robert Conlee

AsiaPacific

GlobalCoordination

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North AmericaSouth AmericaWestern EuropeEastern Europe

Distributor EventsRecognitionCommissionsCreative ServicesNew Market Development

JapanKorea

Greater ChinaSoutheast AsiaAustralia/NZ

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What’s Next?

$2.5 billion in annual revenue

AND $1 billion of annual

commissions!

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