Maximizing Results While Maintaining Flexibility

ISM May 2012

Tyco 2002
Plastics & Adhesives* Electronics* #1 - Connectors #1 - Heat Shrink Tubing #1 - Circuit Protection Devices #1 - Cable Identification #1 - Relays #2 - Wireless Systems
(Non-Tetra Based Systems)

#1 Industrial Duct Tape #1 Garment Hangers

$40B

Fire & Security Services* #1 - Fire Protection Installation Fire & #1 - Fire Protection Product #1 - FireSecurity Service Protection #1 - Security

Commercial

Healthcare* Healthcare: #1 - Wound Care #1 - Vascular Compression #1 - Sharps Containers #1 - Incontinence Care #1 - Electrosurgery

Engineered Products & Services* #1 - Industrial Process Valves #1 - Water Utility Valve Products #1 - Steel Pipe and Tube #1 - Steel Electrical Conduit #1 - Fire Protection Products

Diversified Segments with Strong Leadership Positions

2 *2002 North American Market Positions

Tyco 2012
ADT North America Residential

ADT $3.1B Flow $3.6B

$40B
F&S $10.2B
Engineered Products & Services* #1 - Industrial Process Valves #1Flow Utility ValveTEMP - Water Flow Products Control Controland Tube #1 - Steel Pipe #1 - Steel Electrical Conduit #1 - Fire Protection Products

Commercial Fire & Security

$17B
3 *2002 North American Market Positions

Three Strong Stand Alone Companies

Tyco Tomorrow

ADT ADT $3.1B $3.1B Flow $3.6B

ADT North America Residential

F&S $10.2B Commercial Fire & Security

$10B
Flow Control merges with Pentair ADT and F&S will each stand alone
4 *2002 North American Market Positions

Maintain stability
People

Data
Profit Growth Markets Economics

Process

Company

Flexibility
Leadership Talent Strategy Data Management Category Management 7 Step Sourcing Process

Strategy

Foundation

Leadership

"MEN WANTED: FOR HAZARDOUS JOURNEY. SMALL WAGES, BITTER COLD, LONG MONTHS OF COMPLETE DARKNESS, CONSTANT DANGER, SAFE RETURN DOUBTFUL. HONOUR AND RECOGNITION IN CASE OF SUCCESS -Sir Ernest Shackleton

On August 8th the Endurance sailed for the Antarctic via Buenos Aires and the sub Antarctic island of South Georgia where there was a Norwegian whaling station.
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Drive for Results

Desired outcome

Flexibility

Strategic levers

Organizational Support

Knowledge

Conditions

Strategic Alignment w/BUs

Internal (Tribal)

Economic

Tactical deployment

Managing Outcomes

External

Social

Talent
Management

Regional

Preparedness

One dimensional

Multiple skill sets

Flexibility

Unprepared

Solid game plan

ill-equipped

Strategy
Offensive Strategies: Continuous talent management Partnership Enhanced commitment to suppliers Exploit VA/VE opportunities

Defensive Strategies: Solid risk assessment process Flexible contract terms Strong supplier performance management Build talent bench strength

Tycos Journey
Split It 2011 - 2012 Grow It 2010 - 2011 Refine It 2007 - 2009 Fix It 2004 - 2006 Save It 2002-2003
Liquidity crisis Weak corporate structure with poor controls Concerned customers and suppliers Embarrassed employees Outraged investors New leadership team and board of directors Strengthen corporate governance Restore financial health Resolve legacy legal issues Refine portfolio of businesses Separate Electronics and Healthcare businesses Launch new Tyco Continue refining the business portfolio Enhance operating performance Expand leadership positions in core platforms Align resources for growth Engage, develop and support people and partnerships Create three stand alone companies: ADT NA Residential, Flow Control, Commercial Fire & Security Eliminate Tyco International presence in daily operations

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Develop strategy Install Data warehouse Implement e sourcing Contract data base

Leverage spend Drive value Focus on talent mgt Support Spins

Implement P2P e-sourcing back office Drive SPM doctrine Commodity leadership Strategic partnerships

Sourcing & LSS Savings Trend FY07 thru FY11

Sourcing Savings Lean/Six Sigma Savings

2007

2008

2009

2010

2011

2007

2008

2009

2010

2011

3% - 6% of Addressable Spend Sourcing Savings Summary

Direct 60% Indirect 40%

1% of Revenue

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Focus
Goals: clear and concise yet ever changing Knowledge: shared and expanded Talent: skill, motivation, coaching and continuous training Expectations: factual, meaningful and flexible Process: detail, rigor, cadence, measurements & metrics are also adaptable

Focus must be adaptive while unwavering

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Tangible Opportunities
People Retention : Rewards & Recognition to keep the current talent pool Acquire New Talents : Alignment with Schools, Universities, Learning Centers Diversity: Be inclusive Process Foster Six Sigma Processes Value Stream Mapping Value Engineering Demand Management

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AND the world continues to change

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Three independent publically traded companies

ADT North America Residential
Pro forma Revenue: $3.1B* Market Leader in N.A. Residential Security Services

Flow Control
Pro forma Revenue: $3.6B* Global Leader in Valves, Controls and Related Products

Commercial Fire & Security

Pro forma Revenue: $10.2B* Global Leader in Commercial Fire Protection & Electronic Security Solutions

Standalone Companies With Strong Management Teams, Leading Market Positions And Attractive Financial Profiles

15 *Fiscal year 2011 Revenue is an estimate. Pro forma revenue based on FY11 new structure without other adjustments.

As the world changes

Eight observations: 1. Create a sense of urgency 2. Build commitment 3. Develop a vision and strategy 4. Communicate the change vision 5. Develop an organization to effect change 6. Deliver short term successes 7. Consolidate wins and produce more wins 8. Institutionalize change
John Kotter, Leading Change. Harvard Business School Press. 1996.

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Keys to OpEx Success

One Tyco Methodology Leadership Engagement Consistent Processes and Metrics Talent Management Diversity & Inclusion Training Succession Planning
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Final thoughts
Innovation, and Improved efficiencies Supply Chain is the growth engine Process improvements The way we approach our profession Nurture long term relationships Leadership brings contribution
Maintain Flexibility to Maximize Results

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We Live Our Values Every Day

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