A Winning Partnership Team BG 3 17 2018 1

A Winning Partnership Team! BG 3/17/2018 1

Overview Not Your Dad’s BX/PX Anymore! Store of the Future Collaborative Efforts Questions 3/17/2018

The significant problems we face cannot be solved at the same level of thinking we were at when we created them. Einstein 3/17/2018 3

The last wave of productivity gains came from knocking down departmental walls within companies, getting multiple departments to work together as one. The next wave is upon us, and it is about knocking down company walls - getting multiple companies to work together as one. It is the same kind of thing, only much bigger. Michael Hammer 3/17/2018 4

The Pessimist see difficulties in every opportuni The Optimist sees opportunity in every difficulty Churchill 3/17/2018 5

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It’s Your Father’s PX It’s Not Exchange! Anymore! Yesterday 70% Troops on Base Fort Hood No Wal-Mart 100 Retail Shopping Choices 1970’s vs Families an afterthought 2000’s Fulfillment…. ”Fish in the Boat” 8 3/17/2018 8 Today 70% Troops off Base 6 Wal-Mart Stores 1000 Retail Shopping Choices Families at the forefront Marketing…. . ”Find the Fish”

Trends in Retail Enclosed Mall: • Department store anchors • Self-enclosed shopping • Central to the consumer lifestyle • Trend Today: Casual dining and • entertainment as the main customer driver Power Center: • • Changing marketplace Lifestyle Center: 3/17/2018 Multiple big box anchors Small specialty stores Ease of ingress and egress Convenient alternative to enclosed mall • Convenience • Experience • Sense of place 9

Lifestyle Centers ü Enhance Quality of Life üOffers Great Collaboration with MWR, De. CA and the Installation üDevelop Sense of Place üSupport Military 3/17/2018 10

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Thinking about our business models will create new and different opportunities Suppliers Our scale can be advantageous

Collaborative Efforts Will Fundamentally Change the Performance Curve…. . Together Traditional Ideas 35% The Early Years Ø Ø Transformational Ideas The Future Years 65% The Interim Years Do Better within Box Buy as “one off” Optimize team function Focus on basics Do – Better Within Box Functional Local Team Ø Ø Ø Functional Optimization Manual processes Traditional Performance Metrics Continuous Improvement Leverage some synergies Improve Regional Box Ø Ø Ø Ø Customer Visibility Re-Rationalization Full enterprise Integration Dynamic Optimization Automation Supplier Integration New Metrics Dynamic Enterprise Integration – Remove Box Cross -Functional Regional Team Enterprise-wide Collaboration

New business models needed…a new paradigm V Full Network Connectivity IV Value Chain Collaboration I Enterprise Integration Functional/ Processes II Corporate Excellence Intra. Enterprise III Partner Collaboration Inter. Enterprise External Total Business System Our own thinking and functional walls stop us Source: SC Management Review, Dec 2004

Enterprise wide collaboration drives us towards higher levels of value add activities V Full Network Connectivity III Partner Collaboration Functional/ I Processes Enterprise Integration II Corporate Excellence Inter. Enterprise IV Value Chain Collaboration External Total Business System This is a BIG IDEA!!! Source: SC Management Review, Dec 2004

At The End of The Day LEADERS MAKE A DIFFEREN 3/17/2018 17

Cooperative Efforts Supply Chain Gift Cards § Objective: Partner across the supply chain to lower costs by increasing volume or gaining process efficiencies. § Objective: Improve Customer Service by cross accepting gift cards. § Current or Potential Partners: NEXCOM, MCX, Army MWR, Air Force Services, DECA. § Completed w/ NEXCOM & MCX in Nov 07 Enterprise Architecture § Objective: Conduct baseline analysis of the operation, technical and systems architectures, to develop a road map for future operations. § Current or Potential Partners: NEXCOM and MCX. § Current or Potential Partners: NEXCOM, MCX and DECA. Indirect Procurement § Objective: Leverage combined spend on commodity items to lower costs. § Current or Potential Partners: NEXCOM, MCX, Army MWR, Air Force Services.

Going Green Initiatives ü Energy Savings Products ü Reusable Bags ü Waste Stream Review ü Food Energy Management Systems ü New Vending Machines 19

Collaborative Efforts A Winning Partnership Team! ü “Bringing the Benefit To You” initiative ü 43 off-site Joint Reserve and National Guard events projected in 2008 ü AAFES Commodity and Region support ü Bi-Annual De. CA Truck Load Events ü Everyday in small ways at the local level…. THANKS! 20

At the End of The Day…. . Leaders Make A Difference

We all make choices…. We all leave a legacy We Are Here!!! GREATNESS Where We Are Going!! MEDIOCRITY Two roads diverged in a wood. And I, I took th less traveled by. And that has made all the diff Frost

Trim Tab Leadership…. . You Make the Difference The small rudder that turns the big rudder that turns the ship

CHARACTER + RESULTS = EFFECTIVE LEADERSHIP On the wall of the basement of the United States Capital in Washington, a base-relief depicts a Greek warrior engaged in moral combat with a snake. The artist captures the moment when the man raises his sword to strike the deathblow. Across the tableau is one word: Courage Artistically, physical courage is easy to depict. Moral courage is another matter. Moral courage requires a taking a cold, hard look at the world and then acting, accepting the consequences, and knowing that the greatest good will ultimately be served. Moral courage demands sacrifice, the subordination self-interest to the interests of others. To be morally or intellectually courageous requires a basic sense of honesty and integrity coupled with the will to act decisively on those principles. Moral character is of great matter in a leader and will inevitably affect the substance of his performance. Courage, character, and performance cannot be separated.

Delighting Our Customers… Improving Their Benefits … 3/17/2018 26