Corporate Overview

Launching Lean Six Sigma with a Bang PolyOne’s LSS Deployment

Process Improvement Customers

Webcast Content PolyOne Launching Lean Six Sigma with a bang Keys to success How to fail Results to date

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About Us: PolyOne Corporation A leading global provider of specialized polymer materials, services and end-to-end business solutions 2010 annual revenues of $2.6 billion Headquartered near Cleveland, Ohio, USA Operations in North and South America, Europe and Asia Serving more than 10,000 customers and offering more than 35,000 polymer solutions PolyOne has more than 4,600 employees worldwide in: — More than 60 manufacturing and distribution facilities — Over 12 labs and technical centers — Sales and service locations on four continents 2

Globally Positioned to Serve Our Customers

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At the time of our Lean Six Sigma launch in late 2008, PolyOne was a complex organization consisting of 15 regional business units and 12 functional groups

PolyOne’s Four Pillar Strategy Our customer focus is guided by a four component strategy: Specialization differentiates us through value-creating offerings that extend beyond materials to help customers who care about service, technology and problem-solving Commercial Excellence governs our activities in the marketplace, where we deliver value to customers by showing them how they too can increase their profits and grow Globalization takes us into high-growth markets where our customers are migrating, and positions us to serve them with consistency everywhere in the world Operational Excellence empowers us to respond to the voice of the customer with a relentless focus on continuous improvement in everything we do 4

Launching Lean Six Sigma with a Bang A highly accelerated global Lean Six Sigma (LSS) deployment in which all regions, functions, and businesses are represented and participating From go decision to official launch of under three months Ingraining LSS into PolyOne’s culture as a means to drive the execution of our strategy Focus on key enterprise-wide strategic performance gaps Rigorous project selection process All improvement projects must be run through LSS Steady state by end of second year Trained project leaders in operations, sales, marketing, legal, finance, HR, IT, EH&S, and R&D 1% of the population dedicated as full-time Black Belts 25% of the total population trained in LSS by end of second year 5

Keys to Success

SHARED VISION AND ORGANIZATIONAL COMMITTMENT

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LSS Drives Execution of Strategy

LSS is the foundational element of our turnaround strategy; communicated to all employees, customers, suppliers, and the “street”

“Lean Six Sigma is a

Lean Six Sigma The World’s Premier Provider of Specialized Polymer Materials, Services & Solutions 7

process improvement that brings fundamental and permanent change to our organization. Everybody has to participate.” – Steve Newlin, Chairman, President and CEO

Opportunities for Improvement – Agreement on the Performance Gap Metric

Best In Class

PolyOne in 2007

Scrap and rework

1.2% of sales

2.4% of sales

Sales cycle improvement

6% year over year

not measured

Manufacturing uptime

93%

72%

Opportunities to close

8% year over year

not measured

Price management

3% of sales

0.3% (just starting)

Inventory turns

15 turns/year

7.5 turns/year

End-to-end business diagnostic that leverages internal and external benchmarking to indentify enterprise-wide gaps in performance 8

Multi-level, multi-function interviews along with benchmarking through Industry Week, Aberdeen Group, Corporate Executive Board, and directly against peers

Accelerating Our Strategy Lean Six Sigma helps close the gap between our current performance and being world class

Lean Six Sigma will accelerate our drive toward becoming the world’s premier provider of specialized polymer materials, services and solutions.

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Keys to Success

WELL DEFINED DEPLOYMENT STRAGEGY AND SUPPORTING INFRASTRUCTURE

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Global Deployment Architecture Associates representing every business, functional area, and region came together to map out PolyOne’s Lean Six Sigma deployment in the months preceding our formal launch Hundreds of decisions were made, key examples include LSS Roles and Responsibilities Key Deployment Metrics Training and Coaching Strategy with accelerated impact Communications Plan/ Messaging Project Financial Auditing Practices Project Identification and Selection Process

These decisions were presented to the Lean Six Sigma Steering Committee for final approval and then became the foundation for the deployment 11

Deployment Structure to Create High Level of Engagement, Alignment, and Accountability Chairman, President and Chief Executive Officer

LSS Steering Committee - Senior VP, Process Improvement – Committee Chair - Senior VP, President of Europe and International - Senior VP, Chief Commercial Officer - Senior VP and Chief Financial Officer - Senior VP, President of Distribution - Senior VP, President of Performance Products and Solutions - Senior VP, Chief Information and Human Resources Officer - Senior VP, President of Global Specialty Engineered Materials - Senior VP, President of Global Color, Additives and Inks

Senior Vice President, Process Improvement LSS Global Deployment Champion

Ultimate decision making authority for the LSS Deployment

MBBs

Functional Heads

Presidents

Program Sponsors

Functional DCs

Business Unit DCs

Program Manager

BBs

GBs

KLs

BBs

GBs

KLs

BBs

GBs

KLs

LSS Steering Committee designed to get broad consensus and deployment alignment Business / functional area owns resources and is accountable for results 12

Enterprise provides expertise for deployment, training, mentoring, tracking, and best practices

Keys to Success

FOCUS ON MOST CRITICAL BUSINESS NEEDS

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Closing the Performance Gaps Opportunities for improvement identified prior to the launch of LSS were translated into six enterprise-wide programs under two focus areas Strategic plans were developed detailing benefits, focus areas, projects, and timing Businesses directly support the programs with resources and participation on the respective steering committees

Improving our Supply Chain Efficiency – Reducing manufacturing waste and inefficiencies – Implementing strategic supplier management – Developing predictive and preventive maintenance

Refining our Customer Interfaces – Enhancing sales force efficiencies – Optimization of pricing processes – Improving sales and operations planning

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Programs to drive a minimum of 100 bps gross margin improvement in 2009 and 2010

Project Pipeline Management Initial Project Selection – Start Up Developed project identification process that aligned individual business project identification selection sessions to the six global programs Kept focus on the large enterprise performance gaps rather than local “pet” projects to accelerate returns Provided ability to benchmark in areas where baseline data did not exist Process put in place to manage all ideas, charters, and projects

On-going Project Selection Business units/ functional areas continually fill the project hopper through Scheduled project identification sessions Opportunities identified through current projects Strategic gap analysis Annual operating plan reviews 15

Customer surveys

Keys to Success

CHANGE MANAGEMENT – MESSAGING

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Communication Strategy to Reinforce and Accelerate Cultural Transformation Change management messaging focused on four main themes The voice of the customer will drive all that we do LSS will provide us with the opportunity to distinguish ourselves and leapfrog our competition even during economic uncertainties We have many opportunities for progress in every part of our business. We must improve our ability to share best practices and leverage them throughout the company LSS gives all associates a voice – everyone must participate

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Communication Execution ‘Case for Change’ video of our CEO expressing the importance and organizational commitment to LSS Targeted communication for on-boarding Black Belts as well as their redeployment once 2 year commitment completed Regionally published monthly LSS newsletters highlighting LSS program and project activity Conducted regional LSS EXPOs annually to enhance employee involvement Deployment Champion alignment to ensure seamless communication within business teams and functional areas External communications to Wall Street and through quarterly earnings calls Creation of LSS website and official logo used in internal marketing of LSS 18

Keys to Success

SKILLS DEVELOPMENT AND PROCESS RIGOR

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Skills Development and Rigor Incorporate Lean Six Sigma into our culture and make it part of our core competency that contributes to long-term success Recruit high potential individuals into project leader roles Consistency in Master Black Belt instructors and instruction Use BB mentorship program to facilitate GB and KL development

No projects launched unless under the LSS umbrella LSS goals and targets incorporated into annual operating plans Intensive Yellow Belt training giving everyone a chance to participate – including all Sales Reps around the world

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Skills Development and Rigor Project leaders that take the role as change agents to drive the cultural transformation within their respective groups Control gate oversight on all Black Belt and Green Belt projects to ensure consistency in the process and use of the tools Local dialect, but only one LSS language Provide local training Make all accountable for rigor in process Clearly defined LSS roles and responsibilities

One global system for project management “If it is not in PowerSteering it does not exist”

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Skills Development and Rigor

Examples of standardized reports/ dashboards used to monitor project progress

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How to Fail Make Lean Six Sigma a stand alone initiative Compromise on project rigor and discipline Assume your belts are only there to execute project Let them opt out Go “pet” project wild Settle on those that are available rather than those that will have the ability to lead change when selecting project leaders Have no standardized means for documentation/ project management

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RESULTS TO DATE

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Summary of Results Deployment used strong change management approach to break down business, functional, and regional silos Senior leadership support in all areas of the deployment

Highly accelerated LSS skills deployment with over 28% of workforce formally trained in LSS at the end of 2010

5% 4% 13%

15% 3%

60%

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Summary of Results Recognized by IQPC as “Best Start Up Program” in 2010 LSS communication strategy and execution nominated for Gold Quill Award from the International Association of Business Communications

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Summary of Results Operating income growth of our specialty platform up 50% compared to pre-recession periods (2007 - 2009) Restructuring efforts deliver $70 million in expense reduction in 2008 and 2009 Working Capital reduction of close to 40% (2008 to 2009) Working Capital focus drove over $200 million in free cash flow in 2009

On-time delivery moves from 81% to 95% Customer complaints hit an historic low in 2010 Share price moves from $1.34 in early 2009 to $13.89 at the start of 2011 27

Summary of Results Two year stock appreciation twice that of most peers

Launch of LSS 28

Enterprise value increases by a factor of 10

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