2016 North American Firefighter Respiratory

Protective Equipment Competitive

Strategy Innovation and Leadership Award

2016
 BEST PRACTICES RESEARCH

Contents
Background and Company Performance ........................................................................ 3

Industry Challenges .............................................................................................. 3

Conclusion........................................................................................................... 7

Significance of Competitive Strategy Innovation and Leadership ......................................8

Key Benchmarking Criteria .................................................................................... 9

Best Practice Award Analysis for Scott Safety ................................................................ 9

Decision Support Scorecard ................................................................................... 9

Strategy Innovation ............................................................................................ 10

Customer Impact ............................................................................................... 10

Decision Support Matrix ...................................................................................... 11

The Intersection between 360-Degree Research and Best Practices Awards ..................... 12

Research Methodology ........................................................................................ 12

Best Practices Recognition: 10 Steps to Researching, Identifying, and Recognizing Best

Practices ................................................................................................................. 13

About Frost & Sullivan .............................................................................................. 14

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Background and Company Performance

Industry Challenges
Firefighter respiratory protective equipment in North America is characterized by a “search
and rescue” approach to firefighting that involves entering the structure, extinguishing the
fire and rescuing victims. This search and rescue approach to firefighting obviously
necessitates a high level of protection for firefighters. It has become quite critical to equip
firefighters with technologies that break up the complexity of the search and rescue
process. For example, these include technologies that enable monitoring interior
conditions of the structure, available air supply and elapsed time. Firefighters rely on such
information to navigate smoke-filled areas.

Frost & Sullivan independent analysis reveals that the firefighter market has been less
than responsive to new technologies in the past, and high prices have resulted in less than
optimal adoption rates among end users. Thermal imaging technology has bucked this
trend—it has been readily accepted by firefighters, as its value proposition is clear and
well defined. The price of thermal imaging technology, however, has been a factor. In
addition, manufacturers report to Frost & Sullivan that they constantly face the challenge
of designing firefighter respiratory protective equipment that checks three boxes: form,
fit, and function.

Budgets in the firefighter industry frequently come under strain, putting pressure on
manufacturers to bring protective equipment to the market that has a high
price/performance value. Manufacturers have had to do away with the “bells and whistles”
of technology, particularly in the case of thermal imaging cameras. Thermal imaging
cameras were first introduced in the firefighter respiratory protective equipment market in
the early 1990s. These cameras help improve visibility for firefighters in smoke-filled
environments by creating crisp images of the vision field. The images are created based
on subtle temperature changes. In the early days, The National Institute for Occupational
Safety and Health (NIOSH) recognized that thermal imaging cameras, if introduced as an
add-on to firefighter respiratory protective equipment, could significantly reduce firefighter
injury and illness. When thermal imaging technology was still nascent, it was sold in a
hand-held form; fire service workers were slow to adopt them. Later, it was head mounted
as an add-on to the firefighter breathing apparatus. The uptake in the fireservices market
was poor, because the equipment was bulky. Manufacturers uncovered many challenges
that fireservices rescue workers were facing, including the weight of the camera, a high
ratio of cameras to rescue workers, and gaps in the translation of technical know-how into
effective end-user instructions.

Finally, thermal imaging cameras have to pass the National Fire Protection Association
(NFPA) standards for accessories. Firefighters frequently operate in rugged environments
and confined spaces - and their equipment is likely to be easily damaged. Because of this,
high impact resistance of the equipment becomes critical. Manufacturers need to make
significant investments to meet the appropriate requirements. To this end, they make use

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of a selection process that takes into account life cycle costs.

Strategy Effectiveness

Scott Safety is a leading manufacturer of respiratory, personal protective, and safety

devices with a strong product portfolio in the firefighter respiratory protective equipment
space. The company has a strong track record of meeting the regulatory and operational
requirements of emergency management organizations such as Federal Emergency
Management Organization (FEMA), Department of Homeland Security, National Institute of
Justice (NIJ), and Federal Bureau of Investigation (FBI). Scott Safety is bringing a
technology to the market that has been around since the early 1990s, but in an exciting
new form: an in-mask thermal imaging system. The product empowers firefighters with
situational awareness in their search and rescue operations. Some of the critical functions
of Scott Sight include increased visibility that allows firefighters to easily navigate their
environment, reduced time for search and rescue operations, and easy identification of
escape routes.

Scott Safety successfully launched the Firefighter for Future Initiative in late 2014. In April
2016 at Fire Department Instructors Conference (FDIC), the company showcased Scott
Sight Thermal-Imaging Firefighter Mask. The Firefighter for Future Initiative provides a
strong framework for product development in the firefighter respiratory protective
equipment space. It sets the stage for innovation in a market which has been historically
been underserved. Scott Sight is the first offering to come out of the initiative - with more
offerings likely in the pipeline.

Scott Sight is clearly a critical milestone for Scott Safety; it pivots its efforts to the
Firefighter for Future Initiative. Rather than bring to the market a full suite of capabilities,
Scott Safety is focused on a phased innovation approach. Scott Sight requires little to no
training, as the end product is both user-friendly and intuitive. Scott Sight was initially
launched in FDIC 2015, where feedback was sought from firefighters and then integrated
into the product over a one-year period. The end result is a full-face breathing mask that
incorporates a camera and in-mask display. The camera generates 160x120 resolution
images at a rate of nine frames per second. The system has four-hour nominal run time
and various user configurations.

Scott Sight is quite effective, as it focuses on making thermal imaging technology more
affordable to firefighters. While thermal imaging technology has been available for some
time, a number of incremental add-ons have been made to the technology. It remains
lightweight at 8.5 ounces, comes equipped with an adjustable in-mask display, and has an
infinity lens. It also integrates seamlessly with the AV-3000 HT facepiece, with the camera
attached to the right side of the facepiece. This design aligns well with the fact that most
users are right-eye dominant. Firefighters are able to perform with continuous, hands-free
situational awareness.

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Strategy Execution

Historically, execution has been a true challenge for manufacturers of thermal imaging
cameras in the firefighter respiratory protective equipment market. Scott Safety took a
measured approach to the launch of Scott Sight. They first conducted a VOC (voice of
customer) session at FDIC and Interschutz in 2015 and Intersec in 2016. Then, they
successfully launched Scott Sight at FDIC in 2016. At the FDIC 2016 launch, the company
sold over 200 Scott Sight cameras, making it a very successful launch. Customers paid
out-of-pocket for Scott Sight, which sent a signal to the market that the product
significantly exceeds end user expectations. Scott Safety expects a 20% to 25%
attachment rate to new facepieces (AV-3000 HT). The sales conversion rate is likely to
improve going forward as the product proves its effectiveness in the market. Customers
are likely to perceive the product positively if the initial response is strong. This will nicely
bode well for future sales as the market integrates the positive feedback loop into the
system. Additionally, Scott Sight can be retrofitted to a large installed base of AV-3000HT
respirator face pieces, significantly boosting penetration rates.

The Firefighter for Future Initiative was launched in 2014 as an internal lean start-up,
operating in a technology garage. The focus of the initiative has been to make thermal
imaging accessible, and Scott Sight has truly delivered on that front. All of the basic
functionalities of thermal imaging cameras have been integrated into the mask at a price
that is affordable to end users, and Scott Safety has successfully delivered on making the
product accessible to a large end-user base. The company has also successfully set the
stage for further innovation in the market — for example, the introduction of advanced
technologies similar to Microsoft Hololens, which embraces virtual reality and augmented
reality. This is particularly significant, as end users are likely to embrace newer
technologies that can be seamlessly integrated into their existing breathing masks.

Competitive Differentiation

Scott Safety has integrated Scott Sight into the AV-3000 HT mask, making it lightweight
and allowing firefighters to use their hands for important search and rescue purposes. End
users are cognizant of the benefits of thermal imaging cameras - and rather than reinvent
the thermal imaging camera, Scott Safety has focused on making tweaks to the product.
For example, Scott Sight mounts on the right side of the AV-3000 HT facepiece, as the
majority of the population is right-eye dominant, and the audio equipment mounts on the
left side of the facepiece. In-mask display enables the firefighters to get a continuous
image of their surroundings.

There is also room for further innovation; Scott Safety can integrate evolving capabilities
such as enhanced accountability features, telemetry data, evacuation alarms, radio
interfaces, and enhancements to the audio equipment in the future. Frost & Sullivan
firmly believes that it is noteworthy that these features are being offered at an economical
price to an industry that is constantly under a budget constraint. Scott Sight meets the
stringent requirements of ingress protection (IP) 66 and IP 67 as well as electrical

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approval standards UL 913 Class 1, Division 1, and ATEX Zone 0. Thermal imaging
cameras provide information to firefighters about fire hazards and potential fire hazard s—
areas that are generating abnormally high temperatures. The heat energy from the area is
reflected on the display through a colorization process that can identify the hottest 1% of
the image. The user can choose among multiple color modes (black and white, hybrid,
yellow/orange/red). The image scales in color (yellow/orange/red) along temperature
extremes of 200/500/800 degrees. Scott Sight also provides a 50 degree field of view,
which is at the high end of the range provided by thermal imaging cameras in the market.
Finally, Scott Sight sets the stage for a proprietary learning curve for Scott Safety. A
proprietary learning curve raises the barriers to entry and affords patent protection for
specific time periods.

Stakeholder Integration

Scott Sight brings together members of the growth initiatives team at Scott Safety. The
stakeholder integration has been seamless, as shown by the work the company has done
at FDIC 2015, where it set up an information booth to hear from firefighters exactly what
they are looking for. The company conducted a Voice of Customer (VOC) survey, analyzed
the data, and came to the conclusion that firefighters were looking for respiratory
protective equipment that provides situational awareness.

At the macro level, Scott Safety has successfully responded to a tight budget
environment. It has gone back to the drawing board and re-envisioned its growth strategy
for the future. The outcome of this exercise is the Firefighter for Future initiative - and
just a year into the program, Scott Sight has been successfully developed.

Price/Performance Value

About a decade ago, thermal imaging cameras were considered one of the most
innovative technologies in the market, but were considered out of reach for most end
users. The technology was initially developed for the military segment, providing visibility
in battlefields that were covered with smoke. Prices ranged upwards of $10,000.

Scott Sight leverages this technology at an affordable price and provides all of the basic
functionalities, such as visibility in a smoke-filled environment and locating hot spots - all
under an umbrella group of functions called situational awareness. Situational awareness
is a highly integral feature of Scott Sight, improving hot zone accountability and enabling
communication between firefighters.

Frost & Sullivan exhaustive analysis confirms that Scott Sight’s situational awareness
capabilities go well beyond other competing products. The camera and in-mask display
provides just enough data so as to not overwhelm the firefighter. The integration of the
camera into the masks frees up the firefighters’ hands, giving him more flexibility in his
search operation. Scott Sight is designed in a sleek manner, so that the in-mask display
does not interfere with the firefighters’ field of vision. Finally, there is still room to add

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more capabilities into Scott Sight, setting the stage for future growth and further
innovation.

Brand Equity

Headquartered in North Carolina, Scott Safety is a leading manufacturer of respiratory

equipment, personal protective equipment, and safety devices for firefighters, industrial
workers, police squads, militaries, and rescue teams. As a well-known manufacturer in the
firefighter space, Scott Safety does not have to invest heavily in brand awareness exercise
every time it brings a new product in the market. The initial reception for Scott Sight at
FDIC 2016 was very encouraging; firefighters have tried the product, increasing the
likelihood that they will purchase this solution in the market.

Conclusion
Scott Safety has been a reliable provider of firefighter respiratory protective equipment for
decades. The main focus of Scott Sight has been situational awareness in a form that is
quite useful to the firefighter. Also, Scott Sight is one of the first products developed by
Scott Safety with a consumer mentality. Most, if not all, respiratory protective equipment
requires end users to go through a grant process — this is time-consuming and requires
investment. Scott Sight addresses this pain point by making products more affordable.

Thermal imaging technologies significantly add to the capabilities of firefighter respiratory

protective equipment by providing increased visibility in smoke-filled environments.
Through the introduction of Scott Sight, Scott Safety has demonstrated its commitment to
bringing innovative technologies to the firefighter respiratory protective equipment
market.

With its strong overall performance, Scott Safety has earned the 2016 Frost & Sullivan
Competitive Strategy Innovation and Leadership Award.

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Significance of Competitive Strategy Innovation and

Leadership
Any successful approach to achieving top-line growth must (1) take into account what
competitors are, and are not, doing; (2) meet customer demand with a comprehensive,
value-driven product or service portfolio; and (3) establish a brand that resonates deeply
with customers and stands apart from other providers. Companies must succeed at these
three things — brand, demand, and positioning — to achieve best-practice levels in
competitive strategy.

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Key Benchmarking Criteria

For the Competitive Strategy Innovation and Leadership Award, Frost & Sullivan analysts
independently evaluated two key factors—Strategy Innovation and Customer Impact—
according to the criteria identified below.

Strategy Innovation
Criterion 1: Strategy Effectiveness
Criterion 2: Strategy Execution
Criterion 3: Competitive Differentiation
Criterion 4: Executive Team Alignment
Criterion 5: Stakeholder Integration

Customer Impact
Criterion 1: Price/Performance Value
Criterion 2: Customer Purchase Experience
Criterion 3: Customer Ownership Experience
Criterion 4: Customer Service Experience
Criterion 5: Brand Equity

Best Practice Award Analysis for Scott Safety

Decision Support Scorecard
To support its evaluation of best practices across multiple business performance
categories, Frost & Sullivan employs a customized Decision Support Scorecard. This tool
allows our research and consulting teams to objectively analyze performance, according to
the key benchmarking criteria listed in the previous section, and to assign ratings on that
basis. The tool follows a 10-point scale that allows for nuances in performance evaluation;
ratings guidelines are illustrated below.
RATINGS GUIDELINES

The Decision Support Scorecard is organized by Strategy Innovation and Customer Impact
(i.e., the overarching categories for all 10 benchmarking criteria; the definitions for each
criteria are provided beneath the scorecard). The research team confirms the veracity of
this weighted scorecard through sensitivity analysis, which confirms that small changes to
the ratings for a specific criterion do not lead to a significant change in the overall relative
rankings of the companies.

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The results of this analysis are shown below. To remain unbiased and to protect the
interests of all organizations reviewed, we have chosen to refer to the other key players
as Competitor 1 and Competitor 2.

Measurement of 1–10 (1 = poor; 10 = excellent)

Competitive Strategy Innovation and Strategy Customer

Leadership Innovation Impact Average Rating

Scott Safety 9.5 9.0 9.25

Competitor 1 8.0 9.0 8.50

Competitor 2 7.0 8.0 7.50

Strategy Innovation
Criterion 1: Strategy Effectiveness
Requirement: Strategy effectively balances short term performance needs with long-term
aspirations and vision for the company

Criterion 2: Strategy Execution

Requirement: Adoption of best-in-class processes to support the efficient and consistent
implementation of business strategy

Criterion 3: Competitive Differentiation

Requirement: Unique competitive advantages with regard to solution or product are
clearly articulated and well accepted within the industry

Criterion 4: Executive Team Alignment

Requirement: The executive team is aligned on the organization’s mission, vision, strategy
and execution

Criterion 5: Stakeholder Integration

Requirement: Strategy reflects the needs or circumstances of all industry stakeholders,
including competitors, customers, investors, and employees

Customer Impact
Criterion 1: Price/Performance Value
Requirement: Products or services offer the best value for the price, compared to similar
offerings in the market

Criterion 2: Customer Purchase Experience

Requirement: Customers feel like they are buying the most optimal solution that
addresses both their unique needs and their unique constraints

Criterion 3: Customer Ownership Experience

Requirement: Customers are proud to own the company’s product or service, and have a
positive experience throughout the life of the product or service

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Criterion 4: Customer Service Experience

Requirement: Customer service is accessible, fast, stress-free, and of high quality

Criterion 5: Brand Equity

Requirement: Customers have a positive view of the brand and exhibit high brand loyalty

Decision Support Matrix

Once all companies have been evaluated according to the Decision Support Scorecard,
analysts can then position the candidates on the matrix shown below, enabling them to
visualize which companies are truly breakthrough and which ones are not yet operating at
best-in-class levels.

High

Scott
Safety

Competitor 2

Competitor 3
Customer Impact

Low

Low Strategy Innovation High

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The Intersection between 360-Degree Research and Best

Practices Awards
Research Methodology 360-DEGREE RESEARCH: SEEING ORDER IN
Frost & Sullivan’s 360-degree research THE CHAOS
methodology represents the analytical
rigor of our research process. It offers a
360-degree-view of industry challenges,
trends, and issues by integrating all 7 of
Frost & Sullivan's research methodologies.
Too often, companies make important
growth decisions based on a narrow
understanding of their environment,
leading to errors of both omission and
commission. Successful growth strategies
are founded on a thorough understanding
of market, technical, economic, financial,
customer, best practices, and demographic
analyses. The integration of these research
disciplines into the 360-degree research
methodology provides an evaluation
platform for benchmarking industry players and for identifying those performing at best-
in-class levels.

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Best Practices Recognition: 10 Steps to Researching,

Identifying, and Recognizing Best Practices
Frost & Sullivan Awards follow a 10-step process to evaluate Award candidates and assess
their fit with select best practice criteria. The reputation and integrity of the Awards are
based on close adherence to this process.

STEP OBJECTIVE KEY ACTIVITIES OUTPUT

Monitor, Identify Award recipient • Conduct in-depth industry Pipeline of candidates who
1 target, and candidates from around the research potentially meet all best-
screen globe • Identify emerging sectors practice criteria
• Scan multiple geographies

Perform comprehensive, • Interview thought leaders Matrix positioning all

Perform 360-degree research on all and industry practitioners candidates’ performance
2 360-degree candidates in the pipeline • Assess candidates’ fit with relative to one another
research best-practice criteria
• Rank all candidates

Invite Perform in-depth • Confirm best-practice criteria Detailed profiles of all

thought examination of all candidates • Examine eligibility of all ranked candidates
3 leadership in candidates
best • Identify any information gaps
practices

Initiate Conduct an unbiased • Brainstorm ranking options Final prioritization of all

research evaluation of all candidate • Invite multiple perspectives eligible candidates and
4 director profiles on candidates’ performance companion best-practice
review • Update candidate profiles positioning paper

Assemble Present findings to an expert • Share findings Refined list of prioritized

panel of panel of industry thought • Strengthen cases for Award candidates
5 industry leaders candidate eligibility
experts • Prioritize candidates

Conduct Build consensus on Award • Hold global team meeting to Final list of eligible Award
global candidates’ eligibility review all candidates candidates, representing
6 • Pressure-test fit with criteria success stories worldwide
industry
review • Confirm inclusion of all
eligible candidates

Develop official Award • Perform final performance High-quality, accurate, and

Perform consideration materials benchmarking activities creative presentation of
7 • Write nominations nominees’ successes
quality check
• Perform quality review

Reconnect Finalize the selection of the • Review analysis with panel Decision on which company
with panel of best-practice Award recipient • Build consensus performs best against all
8 industry • Select winner best-practice criteria
experts

Inform Award recipient of • Present Award to the CEO Announcement of Award

Communicate Award recognition • Inspire the organization for and plan for how recipient
9 recognition continued success can use the Award to
• Celebrate the recipient’s enhance the brand
performance

Upon licensing, company • Coordinate media outreach Widespread awareness of

Take
may share Award news with • Design a marketing plan recipient’s Award status
10 strategic
stakeholders and customers • Assess Award’s role in future among investors, media
action
strategic planning personnel, and employees

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About Frost & Sullivan

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