For internal use only Service at ABB Key engine for the next level of profitable growth Group Service, July 2014.

For internal use only

Service at ABBKey engine for the next level of profitable growth

Group Service, July 2014

For internal use only

“Service is one of our greatest opportunities for profitable growth.

Our customers base their buying decisions more and more not only on our reputation or the quality of our products, solutions and systems, but also on life-cycle partnerships and the services we can offer.

Service Key engine for the next level of profitable growth

With world-class services, we really make a difference

for our customers – and all of ABB.”

Ulrich Spiesshofer, CEO

Source: CEO letter to employees, February 2014

For internal use only

Service at ABBTable of contents

Safety first

Don’t look the other way

Building sustainable safety culture

Service strategy

Present at key markets

Full potential service strategy implementation

Profitable growth

Systematic growth development

Order/revenue development

Net Promoter Score in Service

Customer focus

Service value propositions and offerings matrix

Industrializing ABB Service offering portfolio

Service external messaging

Service excellence

Service strategy implementation - focus areas 2014

Customer success stories

Service online

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Service SafetyDon’t look the other way

Inju

ry R

ate

Natural instincts

Dependent Independent Interdependent

Management commitment and driven

Governed by rules and regulations

More reactive than proactive

Selective communication of objectives

Use of control/discipline prevalent

Process and complexity of the operation are well understood

Personal commitment to safety

Individuals can self-manage

Most improvements are procedure-based

Individuals share logic and ideas

Cooperation within and across team

Peer’s keeper Organizational pride Management is comfortable

leading or allowing others to lead

Team is fully engaged in goal setting and improvements

Supervision

Zero as a vision

Self

Zero as a target

Teams

Zero as an expectation Safety by

natural instinct Compliance is

the goal Delegate safety

to manager Lack of

management involvement

Relative Culture Strength

Reactive

Zero is unrealistic

Today Tomorrow Goal

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Injury trends, total incident rate (TIR) and lost time incidents (LTI) improving from 2013

44 standard Code of Practices developed and to be rolled out

10 point action plan under implementation - zero tolerance

Service SafetyBuilding sustainable safety culture

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Present at key marketsPower, automation, infrastructure & transportation

$ 11 billion

35,600 employees

$ 8.5 billion

25,900 employees

$ 8.4 billion

20,300 employees

$ 9.9 billion

30,200 employees

$ 7.7 billion

31,700 employees

Service

$ 7 billion

26,000 employees

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What we said… Achieving the full potential of service

Harvest ABB’s installed base Productized offerings Close white spots – technology

and geography Use the full ABB portfolio

Service as % of total revenue1

15% 15% 16% 17% 17%20-25%

2007 2008 2009 2010 2011 2015

Impact of Service Strategy

Invest in service R&D

Focus on operational excellence

Onboard new service professionals

1 excl. Baldor, Thomas & Betts, PowerOne

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What we said… Increased penetration of Installed Base

PP PS DM LP PA0%

25%

50%

75%

100%

Penetration of service market for ABB installed base by division, 2010-2015

25%

40%

2010 IB penetration baseline by Division

2015 IB penetration ambition by Division

ABB Installed Base value 300 BUSD

ABB IB available service market 20BUSD

Penetration to ABB IB 25% in 2010

Target penetration 40% by 2015

T2015

A2013A2010

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Service business development

Dedicated service product management

Ded

icat

ed s

ervi

ce s

ales

Inst

alle

d ba

se p

enet

ratio

n

Service offering portfolio

Market Transparency

M&A Opportunity Safety

Service

eBusiness

Service Offering Portfolio

Go To Market Distribution

Channels

Customer Contact

Management

Service R&D

Pricing Best Practices

Closed Feedback Loop

Service People

Part Supply Chain

Service Specific Marketing

Service Process & applications

PerformanceOn- and Off site

Service

Where to Play and How to Win frameworkStrategy implementation KPI 2015

Safety LTI < 0.5

NPS > 50%

IB Penetration 40%

Orders 20-25% of total

Op. EBITDA 22%

For internal use only

Systematic growth process Matching customer needs, IB and service portfolio

Industrialized service products and professional product management in place

Installed base known by customer sites, market potential regularly updated

Opportunities prioritized based on potential and customer needs

SMT used globally for initiative tracking and follow up

Service Management and sales trainings established to support growth

Match and identify service opportunities

Prioritize and categorize

service opportunities

Establish growth plan

Execute andfollow-up

Service portfolio

Installed base

Leadership

Execution

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What results we achieved by 2013Organic growth, excluding acquisitions

Both Group and LCS impacted by softening of larger project business LCS small to medium size business showing growth as strategy implementation picks up the momentum Service NPS developed from 12% to 32%

2010 2011 2012 201315%

16%

17%

18%

19%

20%

Service Orders share of total *

* Excludes acquisitions of Baldor, T&B and PowerOne

2010 2011 2012 201360%

70%

80%

90%

100%

110%

120%

130%

140%

Organic Orders Growth *

ABB Group LCS Full Service

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Service NPS 2013

Increase in respondents from 2,500 in 2012 to 11,500 in 2013

Issue resolution, logistics, billing & documentation and spare parts weakest areas

Service NPS 2014

Target set to 40%; focus on systemic issues elimination

Web-inquiry responsiveness 2013

> 50 % increase in inquiries from 105,000 in 2012 to 160,000 in 2013

Inquiries primarily for new sales/products

Web-inquiry responsiveness 2014

2014 target – 75% response rate in 24hrs

What results we achieved…Service NPS/response development 2010 - 2013

26% 25% 28%

37%

36% 35%39%

50%

0%

20%

40%

60%

80%

100%

2010 2011 2012 2013

Within 24 hours Within 72 hours

Responsiveness to customer web inquiries

Service NPS

12%

17%

26%

32%

0%

10%

20%

30%

40%

50%

2010 2011 2012 2013

Total ABB In General DM LP PP PS PA

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Service value proposition and offering matrix

Rapid Response Lifecycle Management Operational Efficiency Performance Improvement

Repairs Spares and consumables Replacement Training Service agreements

Installation and commissioning

Maintenance Extensions, upgrades and

retrofits Replacement Training Spares and consumables End of life services Service agreements

Engineering and consulting

Maintenance Advanced services Extensions, upgrades and

retrofits Training Service agreements

Advanced services Engineering and

consulting Extensions, upgrades and

retrofits End of life services Service agreements

Covering the complete lifecycle

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Industrializing ABB Service Offering PortfolioService product categories driving common approach

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Rapid Response

We guarantee fast and flexible service response to maximize your equipment availability.

Lifecycle Management

We provide you powerful tools and our knowledge base to optimize and extend the lifecycle of your equipment.

Service external messaging Based on service customer needs

Month DD, YYYY

Performance Improvement

Your strategic partner in improving productivity, usability, reliability, safety, cost-efficiency, energy-efficiency and emissions control.

Operational Efficiency

We optimize the usability and efficiency of your equipment and systems to increase productivity.

For internal use only

Business led collaboration

One ABB enabled through cross-divisional collaboration

Profitable growth

Driven by PIE concept

Service strategy implementation Focus areas 2014

Service Excellence

Driven by best practices defined in How-to-Win initiativesRelentless execution

1-1-1-1 Service concept

Safety

Don't look the other way!

Safety first

Service excellenc

e

Profitable growth

Relentless execution

Business led

collaboration

For internal use only

Profitable Growth

Drive penetration with IB intelligence and with improving portfolio

Further drive organic growth with adding service sales, local execution resources, and service attachment rate

Strengthen service expansion focus with right incentives and ownership. Focus on the onboarding of new technologies and scalable software, as well as SaaS capabilities.

Have best people ‘on the bus’, safely

Business led collaboration

Drive BU (and integrated cross BU) value propositions to maximize the potential. Ensure service is integral part of account management across ABB.

Relentless execution

Drive disciplined How to Win initiative implementation across 100+ countries. Have learning from best practices driving the speed.

Implement Service Operational Maturity Assessment model. Systematic self assessment program to ensure quality and effectiveness across the field service processes.

What we need to do from here...Way forward...

For internal use only

Buzzard oil platform, UK• Service contract with

Nexen at North Sea Lifecycle management

Coal-seam gas plant, Australia Long-term service agreement

with Queensland Gas Company

Lifecycle management

Minera Yanacocha gold mine, Peru Remote diagnostic

service contract Rapid response

Clarabelle mill, Canada Upgrade to Vale’s dual pinion

semi-autogenous (SAG) mill Lifecycle management,

Performance improvement

Bauang diesel power plant , Philippines Upgrade of the control system

, Energy Corporation Rapid response

Desalination plant, UAE Upgrade of a distributed

control system at DUBAL Lifecycle management,

Performance improvement

Boliden copper mine, Sweden • Lifecycle services to ensure reliable

grinding operations (LTSA)• Lifecycle management, Performance

improvement

Services across the entire value chainYour partner in performance improvements

Chemical complex, Saudi-Arabia Operations management

software for Sadara Operational efficiency

Shipbuilding site, Bahrain Service agreement with

ASRY for turbochargers Rapid response

Power utility, Germany• Spare part maintenance

agreement with IWB• Lifecycle management, Rapid

responseRoyal Carribean Cruises Ltd. Service agreement Rapid response, Lifecycle

Management

For internal use only

Service onlineConnect with ABB

www.abb.com/service

www.youtube.com

www.yammer.comwww.linkedin.com

www.facebook.comwww.twitter.com

www.abb.com/MyABB

www.instagram.com

www.pinterest.com

For internal use only