Presentation of Management3

1. Introduction to:
Management Three
Results & Execution Oriented
Business Strategy Consultants
July, 2011

2. M3’s strategy is to focus on customers, channels and market strategies in the
Automotive Aftermarket space, working for global or globalising clients
Management Three at a glance
Equity Partners
Strategy Consulting Automotive Aftermarket
 Automotive Industry
Wide  IAM
 Innovation  OES
 Emerging Markets
&  VM (Fiat Vice President)
 Marketing Deep
Marco Neil
 Information Technology
Management3 Srl I.D.
Results & Execution Oriented Business Strategy Consulting
Industry Focus: Automotive
Specialty: Aftermarket
Geographic Focus: Global
Launched: March 2009
Growth 2010/2009: + 180%
Automotive AM Customers 2009-2011: 11
Countries in scope of projects: Europe (>10); India; Middle East

3. Marco and Neil founded M3 based on a strong automotive aftermarket
competence and started developing the firm as a “global born” start up
Founders Professional Profile
Marco Bicocchi Pichi Neil Fryer
Languages
Languages
Italian English
Started his management career in the Information
Automotive industry career holding senior positions in
Technology and Services Industry with international Experience Lucas, TRW, Bosal and Fiat Group Automobiles.
business roles up to Marketing Director in EDS
Electronic Data Systems, and VP Etnoteam where he
20+ years experience in delivery of results in
lead the start-up of Internet Consulting. Competence extremely competitive markets, often in adverse
conditions, culminated in involvement in the turn-
Management consultant with Ernst & Young working
around of Fiat with Sergio Marchionne between 2004
on Global Automotive programs, Principal with Booz Flexibility and 2008.
Allen Hamilton Automotive and Information
Technology practice recipient of the Professional
Excellence Award , Chief Marketing Officer with Speed Board member experience in large IAM distributor.
Unicoop, Associate Director with AT Kearney.
Held international and pan-European organization
Marketing, Strategy, Organization and Information Independent responsibilities; strong capabilities of acting across
different cultures and in HQ to subsidiary dynamics;
Technology; held senior management marketing
positions in business to business and business to
Judgment excellent people skills; ability to develop the strong
working relationships needed to work successfully in
consumer. Active Business Angel board member of
stressful situations.
different start-ups. Added
M.Sc. in Economics & Commerce, University of Turin Value B.A. in English, University of London (UK);
MBA, Warwick Business School (UK)
(ITA); MBA, Nyenrode Business School (NL)

4. M3 solid foundations are based on work done for automotive companies in
the past, adding significant value in different aspects of their business
Founders Experience in the Automotive Industry
Automotive Companies where Management3 Founders have
project and management experience
Experience includes working and living in Europe, North America and Emerging Markets

5. We believe in using a combination of quantitative and qualitative analysis
techniques and that “go and see” is a must do to define market strategies
PROJECT EXAMPLE: INDIA
ENGAGEMENT ACTIVITIES APPROACH
Primary and secondary data collection data analysis and
Data collection and analysis
• Primary Data Collection reporting to address quantitative and qualitative data
needs to satisfy engagement objectives. Extensive
• Secondary Data Collection
library and web research has been performed including
• Data analysis and reporting
last 15 years issues of auto magazines published in
India.
In depth interviews M3 Managing Partners personally performed a number of
• Top Management relevant interviews with Top Management representatives
• Associations Leaders of Vehicle and Components Manufacturers, Large
• Management along Value Chain Dealers, Independent Repair Workshops, Associations,
complemented by local partners activities.
Direct observation M3 Managing Partners visited relevant sites to gain a first
• Car repair workshops hand view of different representative situations in term of
• Parts logistic centers quality, approach and behaviors as far as the Parts and
• VM Aftermarket Services value chain in India is concerned. A total of
about 100 interviews, visits and observations was
completed.

6. We work with a view on the big picture that influences the business of
automotive aftermarket, but …
Automotive Aftermarket Economic Environment
REGULATORY ENVIRONMENT DRIVERS
TRADE COMPETITION EMISSION SAFETY INSURANCE LABOUR
RESTRICTIONS LAW REGULATIONS REGULATIONS REGULATIONS REGULATIONS
MACRO
GEOGRAPHIC
OEM PARTS
TECHNOLOGY
REGIONAL
LEGACY AND
VEHICLES QUALITY
ASSEMBLY
FOCUS
PLATFORMS / MODULES
PART MODULES
DECISIONS
ASSEMBLY
ENGINEERING CHANGES
PARTS
MANUFACTURING LIFE CYCLE
USA
VEHICLE
MANUFACTURERS
VEHICLES PARTS
PARTS
MANUFACTURERS
NORTH AMERICA
MANUFACTURING WARRANTY
EUROPE and EU
FOOT PRINT VEHICLES BADGES
& BRANDS
MAINTENANCE
REPAIR
PARTS
and CAPACITY
MANUFACTURING
CRASH JAPAN and KOREA
DRIVEN KMS SERVICE INTERVALS
VEHICLES
SALES
AUTHORIZED
VEHICLES
REPAIRS PARTS
CHINA
DISTRIBUTION
OWNERS
DEALERS WORKSHOPS DISTRIBUTORS IAM
& USERS
PARTS PARTS
SALES
FOOT PRINT BRASIL
BANKS & CAR INSURANCE
FINANCIAL COMPANIES
INDIA and ROW
COMPANIES
OES PARTS
ECONOMIC AND FINANCIAL DRIVERS
MARKETS FINANCIAL
COST OF COMMODITIES CAPITAL CURRENCY
GROWTH MARKETS
LABOUR COST COST EXCHANGES
RATES SITUATION

7. ... we have also a pragmatic deep understanding of the complex aftermarket
value chain and the multiple variables influencing one the other
Automotive Aftermarket Services Demand and Supply
Variables Influencing Costs and Market Share along the value chain
INFRASTRUCTURE SPARE PARTS
COSTS COST DRIVERS
REPAIR BAY TECHNICIAN PARTS STOCK DELIVERY WORKSHOP
INVESTMENTS
AVAILABILITY of (CAPEX) VOLUME
(Economies of Scale)
SPARE PARTS
High(er) Vehicle Brand
Vehicle Age STOCK
Parts Brand (WORKING CAPITAL)
RESOURCES
COST to
Perceived Quality of Parts
SERVE
Customer Service Experience
Perceived Quality of Labor SATURATION
Price Timing
LABOR COST
Competition
(OPEX – Semi-Fixed)
SERVICE MIX
Low(er) PARTS COST
Fast(er) Slow(er) (OPEX – Variable)
Time to delivery

8. Since M3 was founded several international clients have already engaged our
company to deal with complex strategic issues
We deal with complex strategic issues …. with a pragmatic yet rigorous fact based approach
Market Entry  Managers experience
Valuation
New Geography
 Consulting approach
Pan European Market Entry
Commercial Valuation
Strategy OE to IAM  Primary Search
AUTOMOTIVE
AFTERMARKET  Field Interviews
STRATEGIES
 Partners Delivered
Price Positioning OES Market
Data Collection Strategy
 Multifunctional view
Internationalisation
Strategy  Execution oriented

9. GLOBAL COMPONENT MANUFACTURER
European Commercial Policy
SITUATION
The client is a global component manufacturer and a Fortune 500 company with a leading position in the European IAM
market willing to improve its commercial strategies, with particular reference to trade spending and pricing policies, for the
European market. M3 has been engaged thanks to its distinctive combination of automotive aftermarket industry and strategic
business consulting expertise to identify issues and propose solutions in a high-complexity and challenging environment.
KEY ISSUES MANAGEMENT THREE CONTRIBUTIONS
• The client has undergone significant internal • M3 conducted an extensive assessment of client’s market
changes in the last 15 years and has gained a practices and internal processes, through desk research
leading position in the European market that has to and field interviews, in order to highlight and prioritize
be further developed and protected needs for intervention.
• Intra-channel relationships within the distribution • For this purpose M3 investigated:
chain have been reshaped by the rise of large • Pricing strategies and differentials across 32 national
distributors and international buying groups markets and branches;
• Pricing model is perceived to be a key issue but has • Trade Marketing Promotion current practices,
discounts, bonuses and incentive programs
to be investigated in its fundamental drivers and
• Relationships within distribution chain, interviewing
dynamics in order to understand how to balance
client’s managers and customers
decision making between HQ and branches
• Client’s competitive position in the European market
RESULTS
• Client have been provided with a fact based quantitative and qualitative comprehensive cross view of current situation
gained also trough field research in the eight major European markets visiting clients and client organization
• A fact based recommendation to implement a business transformation aimed at addressing the challenges of Pan-
European and International clients while managing a still relevant local domestic market of small players

10. LEADING BRAKE FRICTION MANUFACTURER
OES Strategy and Account Management
SITUATION
The client is a leading friction materials manufacturer with a strong position in both OEM and OES markets but changes in
market practices are impacting its market position and needed to be understood and addressed with a conscious structured
strategic approach. The decoupling of OEM/OES sourcing was the main issue on the spot but other changes taking place in
the business model called to action. M3 has been engaged to support the client in the identification of key strategic dynamics
and success factors in order to align enterprise strategy to the on going changes and exploit areas of opportunities.
KEY ISSUES MANAGEMENT THREE CONTRIBUTIONS
• Changes in the OEM/OES paradigm • M3 has helped the customer in identifying and
understanding impact of changes in business model and
• Architectural best practices: modularity and
VM customer relationships
commonalities vs. proliferation of variants
• As such M3’s role was to:
• Service strategy models in the service business
• Prepare and lead meetings with VM clients to discuss
(OES and IAM) and competition with VMs and other market view and supplier role;
actors to capture market share in the AM services
• Highlight the changes taking place in intra-channel
market (esp. for older vehicles) relationships, in both the parts distribution market and
• OE Brand equity vs. IAM manufacturer and mega- the service market;
distributors image • Assess market environment changes: technology,
• Opportunities implied by emerging markets growth process, geography, regulatory, customers ..
• Provide client with a comprehensive framework of
strategic analysis tools to support decision-making
RESULTS
• M3 delivered a broad analysis focused on both industry and market global trends and customer’s core competencies from
which derived recommendations to approach the OES market within the changing scenario
• The assignment deliverables conveyed a wide range of tools and frameworks to support strategic thinking and address the
issues of alignment of organization, process and technology

11. LEADING COMPONENTS MANUFACTURER
IAM European market expansion
SITUATION
The client is a market leader present in three continents, with a portfolio of several brands it is organized in two divisions
manufacturing and marketing distinct automotive components technologies. One division is present in the OE and IAM market
while the other is only operating as OE supplier. Having reacted in a positive way to the 2008 automotive market crisis and
observing an higher resilience of business of the division with an IAM presence, the client was willing to evaluate the IAM
market entry opportunity for the second division. Management Three (M3) was asked to evaluate the strategic options.
KEY ISSUES MANAGEMENT THREE CONTRIBUTIONS
• Entry in new market/channel: from a OE-only • M3 has been engaged thanks to its coverage of key
business to competing in the IAM market; competence domains required to answer the client’s
• Strong competition in a relatively small market due request: a specific industry expertise combined with a
to strong specialization and long lifecycle of market strategy knowledge. The aim was to provide the
products. Impacts on economies of scale; client with:
• Different possible production processes bearing • A clear identification of all the drivers for decision-
making
different cost and quality levels, with a direct relation
• An assessment of revenues and profit potential of
of volume to technology (different for OE and IAM);
alternative opportunities
• Future product and process innovations for • The definition of a set of strategic options (from pure
lightweight vehicles is expected to have significant organic growth to M&A initiatives)
impact in product and processes (change in
materials and production technologies)
RESULTS
• A fact-based in-depth analysis of the market, the competition arena and the technology has been carried out so that the
client gained a deep insight on opportunities and threats
• The project highlighted the risks and complexities of an organic market entry and defined a framework to evaluate possible
targets for M&A as well as alternative growth strategies

12. LEADING AUTOMOTIVE COMPONENTS MANUFACTURER
Market entry evaluation (India Aftermarket)
SITUATION
The client, a component manufacturer, with a global footprint, was seeking business expansion opportunities. After
establishing more than a bridgehead in the Indian market by establishing strategic JVs with local manufacturing companies the
client was looking to develop the aftermarket business line. Management Three (M3) was asked to present a proposal to
support the international expansion strategy focusing on the Indian market potential opportunity and the evaluation of
alternative options.
KEY ISSUES MANAGEMENT THREE CONTRIBUTIONS
• The target market was and still is growing at a quick • M3 was engaged thanks to the expertise and industry
rate but players in the IAM distribution chain need knowledge of its managing partners in automotive
substantial improvements in standards and aftermarket and strategic marketing and was asked to
performance; evaluate opportunities and challenges of India market
• Competition from major players aiming at capturing entry options focusing in particular on a potential JV:
the service market is increasing: significant • As such M3’s role was to:
investments are being made in the building of  Conduct a thorough assessment of the automotive aftermarket
organized IAM networks value chain in India (including prices and costs);
• Approach and timing where decisive and the client  Analyse client business model and test its components
against Indian market conditions;
was looking for a professional and detailed
 Transfer lesson learned to management, discuss alternatives
assessment in order to take an informed decision
and recommend action plan
RESULTS
• The assignment conclusions highlighted the opportunities and challenges to enter the market on a first-mover basis given
the projected development of the IAM in following years and the elapsed time required to built a credible operation
• M3 hands-on approach allowed the client to have a visual (photo diary) and factual (parts prices, car population size and
distribution by brand and model, market structure of repair shops ..) view of the market and take a well grounded decision

13. AFTERMARKET INFORMATION SERVICES PROVIDER
Indian Automotive Aftermarket Market Analysis
SITUATION
The client, a European based service provider to the global automotive aftermarket value chain, is expanding internationally,
and has recently established a presence in North America and in China. Management Three (M3) was asked to present a
proposal to support the international expansion strategy focusing on the Indian market potential opportunity.
KEY ISSUES MANAGEMENT THREE CONTRIBUTIONS
• The client organization was stretched with important • M3 was engaged because of the deep industry
development programs and the on going knowledge of its partners in automotive aftermarket and
international expansion initiatives; digital services strategies and asked to take over a
• Client is a digital value chain service provider program management – back to back - role to define an
focusing on providing data based services to the appropriate market entry strategy in India.
automotive aftermarket value chain; • As such M3’s role was to:
• The successful business model of the client is tuned • Conduct a thorough assessment of the automotive
to the market conditions of the European domestic aftermarket value chain in India;
market • Analyse client business model and test its components
against Indian market conditions
• Transfer lesson learned to management, discuss
alternatives and recommend action plan
RESULTS
• The assignment provided the client with a well researched and lively hands-on picture of the Indian Automotive Aftermarket
allowing for a fact based, reality rooted discussion on possible strategic options.
• The project approach based on a mix of desk and field direct observation allowed the client to realistically size the
opportunity and understand the challenges of current business model to succeed in the Indian market

14. AFTERMARKET INFORMATION SERVICES PROVIDER
Indian Automotive Aftermarket Market Entry Approach
SITUATION
The client, a European based service provider to the global automotive aftermarket value chain, was expanding internationally,
and had recently established a presence in North America and in China. Following a previous assignment to Management
Three (M3) to evaluate the market potential in a second step the client asked for an overall evaluation of possible market entry
strategies in the Indian market and to outline an execution plan.
KEY ISSUES MANAGEMENT THREE CONTRIBUTIONS
• A market overview has been produced in the • M3 performed extensive field research involving a series
previous assignment, and execution planning was of interviews to prospect partners on both supply and
required as second step demand side.
• The target business model had to be defined and • Based on findings M3:
fine-tuned based on the identified key success • Delivereda first proposal for the definition of service
factors offering and pricing strategy
• Scope of service offering to be defined according to • Highlighted level of awareness and willingness to
adopt client’s solutions of industry leaders
drivers and criteria (content, delivery platforms, data
• Identified additional areas of intrinsic opportunities
sources and formats) different when compared with
related to Indian landscape (ITC platforms above all)
those adopted in Europe
RESULTS
• The assignment conclusions showed a set of substantial opportunities to enter the market with a first-mover advantage and
a strong relationships with global and local market leaders with a favourable role of local ICT developing environment
• M3 offered three distinct layers for market entry execution, from a “full-speed” plan to a phased one, all aimed at fostering
the best opportunities for the client to achieve its strategic goals

15. LEADING BRAKE FRICTION MANUFACTURER
Indian Automotive Aftermarket Market Analysis
SITUATION
The client is a leading friction materials manufacturer with a strong position in both OEM and OES markets that is considering
an international expansion targeting the Indian market considering different alternative routes. M3 was asked to provide an
overall analysis of opportunities and success factors and to outline possible market entry strategies
KEY ISSUES MANAGEMENT THREE CONTRIBUTIONS
• Strong and constant Indian vehicle park growth is • M3 leveraged its experience and knowledge of the Indian
expected for coming years but a channel strategy market to deliver to the client a structured analysis
tailored for the client has to be assessed and focused on:
devised • a fully detailed depiction of the Indian regulatory
environment;
• Indian market is still a relatively far environment
• an Indian automotive aftermarket overview, focusing
from EU/US standards and practices with a specific
on trends, distribution and customers’ and consumers’
regulatory system and a distinctive on-going
behaviour;
progressive process of transformation towards free-
• collecting and presenting a thorough assessment of
market the brake friction market and its potential
• Complex evolutionary dynamics in the market • Extensive field research activities have been performed in
landscape for each possible target market: Cars, order to acquire and present first-hand evidence and
LCV, HCV, 2- and 3-wheelers knowledge
RESULTS
• From field-gathered evidence and desk research key success factors for a coordinated and strategically sound market
entry and a subsequent sustainable growth have been identified
• A range of tools and strategic decision tools have been delivered to the client together with a set of recommendations and
indications for the development of a well-balanced entry strategy considering market size and price points of products

16. CLUTCH AND HYDRAULICS COMPONENTS MANUFACTURER
Market entry evaluation (Italy Aftermarket)
SITUATION
The client is a global manufacturer of clutch and hydraulics components, with a core focus on the HCV market, active on both
OE and IAM channels with facilities in India, UK, USA, that was evaluating expansion opportunities after acquisition of the
European operations. One target market was the Italian market but the client had no experience of continental Europe
markets. Management Three (M3) was asked to support the client in the identification of opportunities and strategic options
and in the organization of contacts with potential buyers.
KEY ISSUES MANAGEMENT THREE CONTRIBUTIONS
• Mature market during recent years yet still • M3 was engaged thanks to its expertise and industry
attractive: business models and efficiency knowledge of its partners in automotive aftermarket in
performance play key roles Europe in general and Italy specifically
• Competitors and distribution channel performance • As such M3’s role was to:
with uneven performances. • Conduct an assessment of the HCV aftermarket value
• Brand strategy definition and key success factors chain in Italy
for gaining robust reputation on a new market • Analyse client business model and test its components
against Italian market conditions
• Transfer lesson learned to management, discuss
alternatives and recommend action plan
RESULTS
• The assignment was carried out by producing a detailed picture of the Italian HCV market (distribution chain, players,
regional/local specificities) and en evaluation of the market and growth potential for the client products
• Evidence gathered via both desk and field research combining quantitative and qualitative approaches allowed to transfer to
client’s management an adequately complete knowledge of the market, and form realistic expectations for the business case

17. OIL PRODUCTS RETAILER (ISRAEL)
Italy Retail Study Tour
SITUATION
The client markets petroleum products and operates a chain of gas stations and convenience stores in Israel. In order to
expand knowledge and gain insight on current best practices across the international landscape the top management of the
client wanted to visit Italian retail outlets and arrange meetings with top managers of key companies in the gas retail and
convenience stores industries. M3 has been asked to set up the program for the tour and the meeting and documentation on
Italian and international best practices and the rationale behind new store concepts
KEY ISSUES MANAGEMENT THREE CONTRIBUTIONS
• Client needed to gain both first-hand experience and • M3 has been engaged for its specific automotive
guided insights on a wide range of retail concepts expertise and its strong network of relationships with
innovation examples industries and key people from related industries.
• The client needed to have quick results with a • Thanks to its capabilities M3 was been able to provide the
limited amount of time and effort that could be client with:
invested in the project • A time-efficient delivery of the required scope of work
• Commonalities and differences between Italian and • A thorough analysis of the store concept evolution in
Israel markets and hints on the applicability of new Italy and the underlying strategic drivers
retail concepts in Israel • Meetings with key people from leading international
companies (Italian Headquartered MNC or MNC with a
significant presence in Italy) active with store concept
innovation
RESULTS
• Preparatory analysis conveyed a detailed overview of the Italian landscape, a description of current trends and latest
innovations with a comparison with relevant international cases, all summed up in the final project documentation
• The tour mixed together visits to retail outlets in Central and Northern Italy and a series of meeting with retail marketing
managers and experts from leading companies to full satisfaction of client CEO and CMO that participated in the visit

18. Data gathering and quantitative analysis are an important foundation of our
fact based approach …
*Note: This document is confidential and solely meant to represent Management3 capability and expertise. This document may not be reproduced
totally or partially without mentioning the source.

19. … as well as direct observation and interviews that are irreplaceable if you
are willing to understand and challenge myths and superficial conclusions
*Note: This document is confidential and solely meant to represent Management3 capability and expertise. This document may not be reproduced
totally or partially without mentioning the source.

20. Eyes, ears
and brains in the
market for our
clients

21. Management3 srl
Via Barnaba Tortolini, 5
00197 ROMA (Italy)
Marco Bicocchi Pichi Neil Fryer
www.management3.com