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ANA Outlines Corporate Strategy Plan (FY2002, 2003)


As a part of its two-year Corporate Reform Plan All Nippon Airways (ANA), announced its Corporate Strategy Plan outline for the corresponding period, fiscal years 2002, 2003 (April 1, 2002 - March 31, 2004) for the ANA Group.

Under the principles of "selection and concentration," the ANA Group implemented its Medium Term Corporate Plan (FY1999 - FY2002) successfully realizing the radical reform of financial affairs, network reorganization and optimized aircraft allocation. However the tragic events of September 11 and the impending merger of Japan Airlines and Japan Air System transformed the environment surrounding it spurring the necessity of prompt implementation of the Corporate Reform Plan for the coming two years.

In drawing up the ANA Group Corporate Strategy Plan, the ANA Group's corporate philosophy and corporate vision were created to function as the ANA Group's, "constitution" providing the underpinning for the plan.

The ANA Group views the transformation surrounding it as an opportunity rather than a disadvantage. In addition to redoubling efforts at fortifying its reputation for safety, the corporate group aims to be the model for Asia by completely appealing to the customer with quality, customer satisfaction and value creation.

ANA Group Corporate Philosophy

I. Basic philosophy

- Create attractive surroundings for customers
- Continue to be a familiar presence
- Offer dreams and experiences to people around the world

II. Course of Action

- Maintain top priority on safety
- Customer oriented
- Contribute to the society
- Embrace new challenges
- Debate with active interest, decide with confidence and execute with conviction
- Build a powerful ANA Group with the competitive advantage of teamwork

ANA Group Corporate Vision

With passenger and cargo transport within Japan, to Asia and the world at its core operations, the ANA Group aims to be the model carrier of Asia under the three precepts of quality, customer satisfaction and value creation.

ANA Basic Corporate Strategy Plan Outline FY2002-2003

Policy Priorities

Implement value creation management in core air transport operations by improving stakeholder (shareholders, customer, employee) value.

1. Strengthen Management Foundation

2. Safety

While holding firm to our conviction that operational safety is at the heart of air transport management, the ANA Group will continue to adamantly build upon its impeccable safety record.

2. Punctuality

It is essential that we respond to the rigorous demands of the business traveler and make clear the ANA Group's corporate responsibility with the declaration "On-Time Airline ANA".

Further improve on-time departures and arrivals, with revisions to scheduling and airport facilities. Additionally a re-think of the definition of punctuality for domestic operations will be introduced under the concept of departures and arrivals within one minute of scheduled flight times instead of the industry standard of 15 minutes. The following numerical targets will be set for FY2002.

On-time Targets for FY2002

Domestic Operations Target

ANA Scheduled Departure (within one minute) 70% 
ANA Scheduled Arrival (within one minute) 52%
Air Nippon Scheduled Departure (within one minute) 63%
Air Nippon Scheduled Arrival (within one minute) 58%

International Operations Target

ANA Scheduled Departure (within 15 minutes) 92%
ANA Scheduled Arrival (within 15 minutes) 85%

On domestic operations, during the previous fiscal year ANA and Air Nippon posted the following on-time performance figures for departures and arrivals within 15 minutes of scheduled flight times.

ANA: 97.3% (previous year performance 93.9%)
Air Nippon 94.6% (previous year performance 92.9%)

Environment and Society

1. Conservation of the Global Environment

With the threat of global warming as the focus, activities to protect the global environment will be forwarded across the entire group with the introduction of Environmental Accounting* and an Environment Report Paper within fiscal year 2002.

*Quantitative measurements and analysis of maximum results obtainable from global conservation efforts according to cost analysis in business activities 

2. Barrier Free Environment

Improved airport services and revamped facilities for the disabled and seniors by adopting universal design for In-flight equipment and airport facilities. ANA's Sky Assist Desk will be at the vanguard in delivering this enhanced service.
*Sky Assist Desk: a customer desk dedicated to servicing the needs of disabled and senior customers (within Japan toll- free 0120-029-377)

Corporate Organization Structure

Corporate Group

Advance the integration and rationalization of the ANA Group with provision for a structure to facilitate decisive management practices.

Switch to Managing Holding Company*

In order to build a group corporate strategy that advances a consistent strategy of flexibility, ANA will become the managing holding company for an integrated ANA Group. ANA headquarters will carry out the functions of corporate and operations strategy for the entire group.

*ANA's Managing Holding Company will differ from a traditional holding company in that it will conduct operations in addition to managing the entire group.

ANA Brand Unification

In 2002, group airlines Air Nippon and Air Japan to start ANA flight operations under the an integrated ANA brand. Brand unification will be implemented gradually over the fiscal year 2002 with the objective of providing customers higher levels of seamless service.

Travel Agency Integration

Establishment of a holding company called ANA Sales Holdings to oversee the group's three travel agencies, ANA Sky Holiday Tours Co., ANA World Tours Co. and All Nippon Airways Travel Co. With the integration of these companies a portion of the sales functions that were previously handled by ANA will now be transferred to the newly formed company, generating human resource efficiencies and strengthening the sales network.

Managing Indices

At the foundation of the corporate group, the ANA Group will steadily advance value creation with a stringent focus on management by objectives.

1. Complete management focus on ANA's ANA Value Creation (AVC) management index.

Start of AVC management by objectives for each business from fiscal year 2002, by treating each group company under a common value preparation of AVC for each business.

*AVC (ANA's Value Creation): Implemented in fiscal year 2001, ANA's management index that measures whether "Value Creation" surpasses investor expectation rate on expected return from capital invested by shareholders per profit produced by business (pretax business profit).

2. Introduction of Customer Satisfaction Index (TQS*)

Targeted improvements for creating customer value (TQS) in air transport service, established along side ANA's AVC with the goal of being the leader in Asia after fiscal year 2003.

*TQS (Total Quality Score): Includes comprehensive evaluation on air transport service, safety, punctuality, comfort, convenience and other measurements as determined by the customer.

Corporate Strategy

Air Transport Strategy

To maximize managerial efficiency, the ANA Group will actively appropriate management resources in conjunction with network reorganization and region of flight operation. 

- ANA will operate wide body aircraft (B767, B777, B747) in main markets from Tokyo's Haneda and Narita airports.

 Air Nippon (ANK) will operate narrow body aircraft (A320, B737) mainly for the local market. In fiscal year 2002, A320 aircraft operations will be gradually consolidated at Air Nippon.*

- Air Japan (AJX) will operate B767's in its business area, international operations to Asia and resort destinations.

*Both ANA and Air Nippon currently operate A320 aircraft.

Business Developments

- Aim for operation of turbo prop aircraft at Osaka's Itami airport in FY2003 and review establishment of new company for this service.

- Beginning with ANA Connection* complement the ANA network with a low cost scheme through tie-ups with other companies.

- Build an international network with Asia, namely China at the foundation and build the network to the next level with strategic code-share alliances.

- Increase revenues and reduce costs through tie-ups and code-share alliances on international network with Star Alliance partners.

*ANA Connection; flights are operated by The Fair Inc. and Nakanihon Ailrine Co.

Product (Service) Strategy

The ANA Group will appeal totally to the customer by providing a product rich in originality and creativity with "ANA Style" as the standard and strive to fortify the competitive strength of its product under the following initiatives.

- Provide competitive and convenient fare structure

- Develop an even more attractive ANA Mileage Club Program

- Realize simpler and more convenient reservations, ticketing and check-in operations by strengthening the company's CRS (computer reservation system)

- Strengthening of the Asia network with new services and flight attendants proficient in Chinese

- Introduction of new international service featuring seats that are comfortable and advanced, providing a high quality cabin environment

- Increase convenience with improved internet reservation function

- Utilize customer feedback in order to provide discriminating service for frequent flyers

Cargo Businesses

Introduction of B767 Freighter

In close cooperation with Nippon Cargo Airlines, ANA will introduce a B767 Freighter in September 2002 to meet rapid demand for cargo transport in China and Asia.

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