Specialty Materials Government Relations Town Meeting June 3, 2010

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Ellen Bland Director, Customer Service Performance Materials and Technologies

A Customer Service Journey

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We Are Honeywell

Energy Efficiency, Energy Generation, Safety &

Security, and Globalization

Chemicals, Specialty

Materials & Fertilizers

Safety & Security

Aviation & Defense

Automotive & Transportation

Buildings, Construction &

Maintenance

Consumer & Home

Efficiency, Energy & Utilities

Fire Protection & First

Responder

Healthcare & Medical

Industrial Process Control

Manufacturing

Oil & Gas, Refining,

Petrochemicals & Biofuels

Scanning & Mobile

Productivity

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Honeywell’s Businesses

Aerospace

$11.5B

Automation and Control Solutions

$15.5B

Performance Materials and Technologies

$5.7B

Transportation Systems

$3.9B

*2011 revenues • Nearly 130,000 employees in more than 100 countries • More than 19,000 engineers and scientists • A Fortune 100 company • Revenue of $37 billion in 2011

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Performance Materials and Technology

Business:

Morristown, New Jersey (U.S.)

More than 8,600 worldwide

$5.7 billion in 2011

A global leader in developing and manufacturing advanced materials and process technologies. These materials and technologies are used by people every day in a wide range of industries and applications, from petroleum refining to environmentally friendlier refrigerants to bullet-resistant vests.

Andreas Kramvis President and CEO

Leadership:

Headquarters:

Employees:

Sales:

R&D Centers of Excellence:

Locations: More than 60 facilities worldwide

Buffalo, New York Des Plaines, Illinois Gurgaon, India Morristown, New Jersey Richmond, Virginia Seelze, Germany Shanghai, China Spokane, Washington Sunnyvale, California

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Key Differentiators

● Amherstburg, Ontario

● Baton Rouge, LA ● Geismar, LA ● Shreveport, LA

♦

● Buffalo, NY ● Tonawanda, NY

● Kingman, AZ ● Chandler, AZ ● Tempe, AZ

● ● Chesterfield, VA ● Colonial Heights, VA ● Hopewell, VA

● Danville, IL ● McCook, IL ● Metropolis, IL ● Riverside, IL Des Plaines, IL UOP HQ

● Claymont, DE

● Columbia, MO

Morristown, NJ Corporate/SM HQ

● Muskegon, MI

● Mobile, AL

● Bryan, TX ● Mansfield, TX ● Orange, TX

● Fombell, PA ● Frankford, PA ● Pottsville, PA ● Smethport, PA ● Titusville, PA

● Erkrath, Germany ● ● Seelze, Germany

● Widnes, UK ● Surrey, UK ● Brimsdown, UK

● Anaheim, CA ● San Jose, CA ● Santa Clara, CA ● Sunnyvale, CA

● Spokane, WA

● Hsin Chu City, Taiwan

● ● Shanghai, China/HEM HQ

● Haryana, India

● Salt Lake City, UT

● Golden, CO ●Littleton, CO

● Manufacturing ● Research ● Sales Headquarters

● Anderson, SC

● Milan, Italy ● Reggio Calabria, Italy

● Bangkok,Thailand ● Chonburi,Thailand

● Jincheon-gun, S. Korea

● Antwerp, Belgium ● Eupen, Belgium ● Haverlee, Belgium

● ● Singapore

● Hiratsuda, Japan ● Kanagawa-ken, Japan ● Yaita, Japan ● Yokkaichi City, Japan ● Tokyo, Japan

●Calgary, Alberta

● Rungis Cedex, France

● Jakarta, Indonesia

● Dubai, UAE

●Jeddah, Saudi Arabia

● Beijing, China

● Moscow, Russia

● Kuala Lumpur

● Gurgaon, India

North America: Home to most of PMT’s

manufacturing facilities

58% of sales outside the U.S.; Customer Service locations

worldwide

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The Journey of PMT Customer Service

• Multiple CS Locations

• No Central Point of Leadership

• No CS Definition

2002 • Co-location of

CS teams • Central Point

of Leadership • CS Function

Defined

2008 • Order

Automation • HOS

2012

The Honeywell Operating System (HOS) drives sustainable improvements in operations, standardizing work, reducing costs and improving service quality.

Continuous Improvement

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The Customer Service Challenge…

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KPIs vs. Management Metrics

KPIs Management Metrics

• Expectation is to always be 100% in compliance

• Not routinely published outside of CS

• Covers adherence to standard process, SOX compliance, etc.

• Meaningful to external or internal customers

• Measurable

• Can be improved

• Routinely published to internal or external customer base

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Honeywell KPIs: Delivery and Quality

On Time To Request (OTTR) • OTTR = (number of orders delivered complete and on time / the

total number of orders due in the same time period) x 100 • For orders containing multiple delivery lines having different dates,

the line items are counted as individual orders. • Example:

- Number of Orders Delivered On-Time = 31 - Number of Orders Due for Period = 32 - OTTR = 97%

Quality • Customer PPM = Product Quality Defect Count (UOM)*1,000,000

Total UOM Shipped

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PMT Customer Service KPIs

Wave 1 - Mature • Invoice Accuracy • On Time Order Entry

Wave 2 - Established

• Perfect Order (Customer Experience) • % of Orders Created via Automation • % of No Touch Orders via Automation • % of Low Touch (First Pass Manual Orders)

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No Touch Orders

No Touch Order Created automatically and correctly … no CSR intervention required

Automated Orders with Correction This is the balance of automated orders that are not “No Touch”

Manual Order Entered on First Pass Created by a CSR and requiring no changes after VA01

High Touch Orders Created by a CSR and changed after initial save. This is the balance of manually created orders.

Four Scenarios: Order Creation Through Invoice

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Defining No Touch vs. Low Touch

No Touch Order • Sales order is populated automatically via automation and no CSR

intervention is necessary through shipment and invoicing.

Low Touch (Manual Orders Created on First Pass) • Order is created on first pass by CSR, with no changes after initial

save through shipment and invoicing. These are likely candidates for no-touch, but caution … manual steps may be taken prior to initial saving of sales order.

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Next Steps for PMT CS

• Automate to reduce non-value added work wherever possible

• Continue deployment of the Honeywell Operating System

• Increased standardization to allow flexing of global CS

teams when needed • Increased focus on process improvement and customer

experience

• More CS interaction with customers

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Honeywell PMT CS and CCMSG

• The Chemical Customer Service Management Group (CCSMG) is a business chapter of the International Customer Service Association (ICSA).

• To provide a professional forum from which the Chemical, Pharmaceutical and Allied Industries membership will have Networking and Educational opportunities

• Honeywell PMT CS has had representation on the board of directors of CCSMG since 2004

• CCSMG provides benchmarking opportunities all year long, plus a conference each spring

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CCSMG Membership Measurement Challenges (From 2012 Spring Conference)

• Cost to Serve – identified as most challenging metric. • No Touch Order – #2

Other Measurement Challenges:

- Credit Related Issues - Customer Experience - Net Promoter Score - On Time Delivery

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Questions?

Specialty Materials Government Relations Town Meeting June 3, 2010

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