strategic priorities - aa new zealand€¦ · building customer loyalty to the aa brand. our...

Strategic Priorities

FOR SUCCESS

A 2013 PERSPECTIVE

Motoring Support1

Member Discounts2

Tourism3

Advocacy4

Insurance & Finance5

Driver Education6

Our Cornerstone ServicesOUR VISIONThat AA Membership is truly indispensible The New Zealand Automobile Association’s vision is to establish a relationship with as many New Zealanders as possible. That relationship will be based on assistance and service, and a range of benefits that encourage motorists to become AA Members. Our vision is that every motorist considers AA Membership to be essential for their mobility.

Membership is the highest it has been in the 110 year history of our Association, and comprises nearly 900,000 personal AA Members and 470,000 business vehicle memberships.

To achieve our vision the AA’s goal is to continue to grow AA Membership and this plan sets out the strategic roadmap to achieve this increase.

OUR STRATEGYOur strategy is to focus on three priorities:

Our Cornerstone Services: Pages: 2 - 14To be the Number One provider of assistance in six core service areas.

Our Foundations: Pages: 15 - 19To utilise our unique strengths and Member-centric focus to achieve that success in those six cornerstone services.

Our Challenges: Pages: 20 - 22Changing dynamics within the AA and the market will always present challenges. We must ensure those challenges do not hinder the achievement of our vision.

21

Roadservice

Roadservice continues to remain the key reason why motorists join the AA. Ultimately, having 24/7 roadside assistance protection provides added security for Members.

Today the AA remains the leading provider of roadside assistance for New Zealand motorists, including commercial vehicle fleets and company registered vehicles. Our strategic goal is to retain our Number One position by simply being the best. This means providing the friendliest, fastest, most efficient and unparalleled quality of service.

Success in maintaining this position is vital, noting the important role roadservice plays in attracting new members, retaining current Members and building customer loyalty to the AA brand.

Our strategic priorities are:

u Continue to invest in roadservice capability and enhance delivery standards through innovative solutions, particularly around response times and providing Members with time of arrival information – providing them with confidence that assistance is on its way.

u Embrace emerging technologies – especially mobile – to assist in enhancing service capability and overall customer experience.

u Ensure service standards are consistent across the delivery chain.

u Respond to Members’ and customers’ needs as if they were the sole beneficiary of the service – not one of 500,000 roadservice calls the AA responds to each year.

VehicleServices

We take pride in assisting motorists when it comes to purchasing and maintaining their vehicles. Services include Warrant of Fitness (WoF), registration, service and repair, advice when buying or selling a vehicle, and technical advice.

Being Number One relies on the idea that Members come to the AA as the first choice whenever a motoring service need arises or advice is sought.

Rationalisation within this highly competitive market will occur over the next few years as WoF inspection frequency changes and the motor trade responds to an overcrowded market. It is critical that we plan ahead in order to retain our position.


u Respond to the changing market by repositioning the range of AA vehicle services to AA Auto Centres. Strategically positioned to meet Member demand, AA Auto Centres will provide all vehicle services under one roof. This will achieve operational efficiencies, and enable existing service outlets to be rationalised.

u Gradually franchise the majority of AA Auto Centres, with the AA itself operating key sites in major metropolitan areas.

u License the AA Auto Centres to deliver pre-purchase inspections and become hub centres for increased mobile service delivery.

u Build Members’ use of our free motoring advice service – if it’s about vehicles, there should be a no more independent knowledgeable authority than the AA.

DriverLicensing

Since 1999 the AA has contracted to the NZ Transport Agency (NZTA) as a Driver Licence (DL) agent, which has involved processing 80% of all licensing transactions for New Zealand drivers.

This DL role has introduced a significant number of motorists to the AA network, and generated revenue that has assisted in sustaining our New Zealand-wide AA network presence.

The DL contract is scheduled for tender in 2014 and we expect it to be hotly contested. The challenge for the next contract term will be supporting the Government’s target to significantly increase the number of online licensing transactions by 2017. The key issue will be how the AA remains relevant as an NZTA agent throughout this transition phase.


u Continue to deliver excellence around our execution of Driver Licensing services and ensure customer experience is as positive and efficient as possible.

u Monitor our delivery standards with the objective of continually enhancing customer experience, minimising waiting times and ensuring accuracy levels around transaction processing.

u Support the NZTA in progressing the Government’s directive around increasing the percentage of online transactions.

u Tender for the renewal of the DL contract, with the objective of retaining our involvement and delivering services through our nationwide AA outlets.

u Engage with the NZTA to explore how the customer experience can be enhanced and a positive experience made out of what is often considered a grudge transaction.

Motoring Support1

3 4

AA Smartfuel replaced our AA Rewards loyalty programme, which had been in place for 13 years. While AA Smartfuel benefits accrue in the form of fuel discounts, AA Rewards provided points that accumulated towards a discount coupon, Membership discount or an instant discount on a purchase.

AA Smartfuel has been embraced by many Members and other consumers, providing greater value than what AA Rewards offered, but the programme does not appeal to all retailers.

We have links with the United States AAA organisation, which operates a global ‘Show Your Card & Save’ (SYC&S) benefit programme. The opportunity exists for us to build a similar alternative Member benefit programme offering instant dollar savings on the presentation of a Membership card. We expect that some of the former AA Rewards partners not attracted by AA Smartfuel will respond to this alternative benefit programme.


u Evaluate the SYC&S programme in addition to AA Smartfuel to provide Members with the ability to earn instant discounts or added value when they purchase from retail partners.

u Utilise the electronic tracking facility on the AA Membership card to report value earned to Members and partners.

u Promote the range of SYC&S benefits and savings available at selected retailers overseas from partnerships negotiated by our global motoring club partners.

Fuel Discount

In 2011 we launched a programme to help Members and other New Zealand motorists reduce their fuel costs. AA Smartfuel enables motorists to accumulate ‘cents per litre’ fuel discounts when they spend at participating retailers. These discounts can be redeemed on fuel purchases at BP and Caltex. BP and Caltex currently also offer an additional discount of 6 cents per litre through AA Smartfuel on fuel purchases of $40 or more.

By early 2013, 760,000 AA Members and 340,000 non-Members have accumulated fuel discounts through the programme.


u Grow the AA Smartfuel partner village to increase the opportunity for participants to earn discounts. This is critical to enable Members to build their savings quickly, diminish the programme’s reliance on fuel company discounts and increase revenue.

u Cross-sell AA Membership to the growing non-Member AA Smartfuel cardholder base. Profile the success of AA Smartfuel at every opportunity to attract new retailers to the partner village and encourage more consumer participation.

u Use fuel discounts to attract younger motorists to the programme and leverage this to encourage them to become AA Members.

u Encourage BP and Caltex to continue their discount offerings and promotion of AA Smartfuel through their marketing channels.

MemberBenefits

In 2012 we forged a partnership with Specsavers to offer free eye tests as a new Member benefit. Every two years AA Members are entitled to a free comprehensive eyesight examination worth $60.

The Specsavers Member benefit is highly valued by Members and also contributes to improving road safety. While Members are not obliged to buy eyewear from Specsavers, the company is benefiting from increased sales from our Members.

We can further enhance the value of AA Membership by adding other benefits like Specsavers. Any Member benefit we consider must be genuine in its value, unique to AA Members and have some relevance to a motoring organisation to enable us to promote it as a benefit of Membership.


u Continue to evolve the Specsavers relationship and broaden the programme into additional Member benefits around eye care and eyewear.

u Introduce a free professional driving lesson for Members, or the children of Members, who are learning to drive. This has a Member benefit value of $60, and there is potential to increase the frequency and value of the concept.

u Form other commercial relationships to enable the AA to provide other meaningful Member benefits of similar value and relevance.

Show Your Card

& Save

Member Discounts2

5 6

Tourism3

The AA has played an active role in tourism since the 1920’s. Being Number One means being the leading provider of tourism services to the public and the first port of call for Members when requiring assistance for their tourism needs.

In recent years the internet has provided a ready source of tourism information and booking options, which has seen our former dominance in this sector diminish.


u Identify how the AA can take a lead role in tourism services and engage new skill sets in the management of tourism service development.

u Build our domestic tourism profile by engaging in campaigns such as the ‘101 Campaign’.

u Engage in a ‘Drive Tourism Campaign’ and partner with domestic tourism organisations in the accommodation and rental car sectors to promote and encourage New Zealanders to travel around New Zealand before going overseas.

u All domestic tourism expansion needs to be innovative, take advantage of location-based services and digital channels (capitalise on real-time information), be Member-centric, and offer pricing advantage.

u Build Member value in the service, utilising ‘Show Your Card & Save’ and maximising business linkages with Thrifty Rental Cars and our joint venture in Bookabach.

Domestic

Qualmark is a partnership between the AA and Tourism New Zealand and is recognised as the tourism industry’s guide to quality assurance and environmental tourism standards.

Considered by many as a premier quality assurance guide within New Zealand, Qualmark is also a model that other governments and tourism organisations can emulate should they want to provide a similar quality assurance.

Mindful of our objective to grow the AA’s involvement in domestic tourism, our priority is to continue our commitment to Qualmark – in terms of our subsidy to fund its operation and our governance role and shareholding ownership of 40%.


u Build our strong involvement in the direction of Qualmark, recognising that the New Zealand touring public are better informed by virtue of a quality rating.

u Continue to subsidise Qualmark’s operational funding in recognition of the industry’s support of our tourism services, noting the significant advertising income the accommodation sector provides for our free accommodation guides.

u Integrate the Qualmark database with the AA’s tourism information.

u Seek new opportunities to broaden the reach of Qualmark and its public profile, particularly for inbound tourists.

QualityAssurance

A highly competitive travel agency industry, low margins and changes in how people arrange travel dictates that the AA can add little value by providing international booking services.

However, the international tourism sector still provides plenty of opportunity.

The Association can play a role in facilitating international tourism by providing advice, travel information and discount benefits to Members and working with our overseas motoring clubs.

One such venture two years ago was the formation of Club Tourism Publishing (CTP) a joint venture with the Australian motoring clubs. CTP provides guides and tourism information to Members on both sides of the Tasman.


u Provide Members with more international travel information as to how they can access benefits while overseas, ie rental cars, accommodation reservations and reciprocal benefits.

u Develop new partnerships to extend those benefits, leveraging the collective strength of the New Zealand Membership base and that of our overseas colleagues.

u Promote benefit offers already negotiated by overseas Clubs through SYCS, and capitalise on the opportunity to work with our sister Clubs both in Australia and the region to develop travel opportunities unique to the organisation.

u Work closely with the Australian Clubs to increase the success of the CTP guides operation in Australia with commercial and Member benefits in mind.

u Enhance travel insurance benefits for Members and promote the advantages already offered by FIA membership, including international driver permits and carnet de passage. Ensure that help is always there no matter where assistance is required.

u Establish a common brand masthead for international tourism – ‘The AA Traveller’.

International

7 8

Every day politicians, policy makers, media and other interest groups make decisions, debate policy, change taxes, build infrastructure and communicate information that impact on motorists. Protecting and promoting the interests of AA Members and advocating on their behalf is a key service provided by the AA. Successful advocacy means saying the right things, in the right places, to get the right results. We want AA Members to:

Identify with what we say: clearly reflect their views on issues of concern – the cost of motoring, road safety, mobility choice, and the pleasure and freedom of their motoring.

Hear what we are saying: we need to be seen and heard in the media, in government, and with decision makers.

Recognise that what we say makes a difference: the quality of our policy, research and advocacy influences key decisions.

Our strategic priorities are:u Maintain our recognised position as the

motorists’ champion and the voice of the reasonable motorist.

u Use our Membership surveys to deliver timely information and insight on a wide range of subjects.

u Ensure our advocacy accurately reflects Member views and resonates with the wider motoring public.

u Undertake research programmes through the AA Research Foundation, which are well managed and deliver powerful road safety findings.

u Harness the strength of our National and District Councils to efficiently and effectively perform our regional and national advocacy.

Advocacy

The AA is New Zealand’s leading road safety campaigner. Road crashes cause enormous harm to our Members and the communities in which they live.

The AA wants motorists to be as safe as possible on the roads. We work to raise public awareness and knowledge of how drivers can play their part in road safety. We also play an important role in improving road safety outcomes by positively influencing policy development and decisions, and public opinion. We take a constructive partnership approach to our safety advocacy and our views are sought out and respected.


u Deliver our road safety election manifesto, and update and energetically promote it for the 2014 General Election.

u Influence the development and implementation of the FIA Decade of Action and key Government policies such as Safer Journeys.

u Continue to be a leading and credible commentator on road safety.

u Grow the Students Against Driving Drunk and AA Research Foundation programmes to deliver enhanced road safety outcomes.

u Ensure AA District Councils focus their attention on local road safety issues and make a difference in their regions.

u Ensure AA District Councils have the opportunity to contribute to the development of national road safety policies.

Getting the right level of transport investment is critical for New Zealand’s economic and social development. Infrastructure must support motorists’ mobility, improve their safety, and cater for different transport modes and freight. Successive governments have adopted different philosophies to guide this investment, but a consistent and long-term vision is required.

While investment is now at record high levels, the demand for additional public transport and roading infrastructure has also increased. The Roads of National Significance programme provides significant benefits, but it is putting huge pressure on the available funding and limiting the number of projects that can be completed.

We need to decide how best to raise additional revenue, and how it should be spent. Some choices will be uncomfortable for motorists and will challenge traditional funding models. The AA will not shy away from difficult choices if they offer the best long-term outcomes for our Members, motorists and New Zealand.


u Develop a set of principles for infrastructure funding and use this to advance the interests of Members and motorists.

u Engage our District Councils to reflect the different regional perspectives and needs.

u Use research and surveys to better understand the views of Members.

u Increase engagement with government agencies, stakeholders and others interested in transport funding so that we lead the debate, not respond to it.

u Participate in the Auckland Council-led transport process to identify suitable funding tools and establish the region’s investment priorities so that Auckland’s transport needs are met and the wider impact on New Zealand is considered.

4

Motorist’sChampion

RoadSafety

RoadingInfrastructure

9 10

The AA has a growing relationship with AA Members and the New Zealand public through providing motor, home and contents insurance via AA Insurance.

In recent years AA Insurance’s policy base has increased significantly with the company’s focus on providing premier motor vehicle insurance protection. This has been achieved by offering more choice to customers – from basic third party insurance, to a new comprehensive ‘no frills’ motor policy.

Today AA Insurance policy holders enjoy a choice of motor vehicle insurance and competitive pricing options.


u Continue to grow the motor vehicle insurance portfolio to attract 25% market share by 2015.

u Leverage opportunities through the motor vehicle portfolio to grow home and contents.

u Consider innovative pricing options and cover alternatives for home and contents insurance similar to the initiatives introduced for motor to stimulate growth.

u Continue to build a reputation for quality of cover and customer servicing.

u Continue to improve operational efficiency to ensure both profit and growth targets across each portfolio are achieved.

AA Life provides Members and the public with a range of life insurance options, including accidental death, term life and funeral cover.

The sale of life insurance protection is heavily centred on AA Centre staff activity, direct mail and, more recently, inbound telephone calls prompted by daytime television advertising.


u Continue to improve sales by using our database effectively to ensure cost effective, targeted promotion.

u Broaden product offerings currently promoted, using daytime television beyond funeral cover. Build this inbound sales channel to represent 40% of total sales.

u Develop new Life-related insurance products in the areas of core Life Insurance, along with income and mortgage protection.

u Review pricing options to ensure underwriting arrangements do not restrict sales or impact our competitive position.

For more than three decades we have provided a range of financial products to our Members, including term investments and vehicle loans.

In 2009 we formed a car finance relationship with Marac Finance, which is now part of Heartland Bank Ltd. We have also developed a range of business loans and vehicle leasing options for Members over the last few years.

We added to our range of products in 2011 by purchasing 50% of Marac Insurance Ltd. Three additional products, Mechanical Breakdown Insurance, Guaranteed Asset Protection and Lifestyle Protection Insurance, now complement our lending products.

Today we’re working with Heartland Bank to develop a range of finance products for AA Members.


u Introduce AA Heartland product offerings.

u Expand the financial service offerings to the AA Membership base.

u Grow AA’s market share for personal and business lending.

u Leverage AA services, particularly pre-purchase inspections, to grow AA’s market share for mechanical breakdown insurance.

u Seek further opportunities in the financial services arena, where new products and potential partners meet the AA’s high threshold for value and service for Members.

u Always ensure that every product offered has a tangible Member benefit.

Insurance & Finance5

Insurance Life FinancialServices

11 12

The AA has been a leading provider of driver training for many years. We’ve now elevated our service role around learning to drive by committing to do more as an Association in the learning process for beginner drivers. Hence, in 2012 Driver Education became a sixth cornerstone service of the Association.

This commitment reflects the belief that professional driver training improves the skill set and attitude of learner drivers, which will in turn, make them safer motorists.

The first initiative is to invest in providing all learner drivers with a comprehensive booklet on how they should start to learn to drive safely and get their driver’s licence. This booklet will assist learner drivers to be best equipped with safe driving knowledge and the next steps to obtain their full drivers licence.


u Produce, in conjunction with NZTA, a booklet entitled “The A to Z on learning how to drive” to assist parents and supervisors to guide learner drivers and provide all the information necessary to obtain their licence.

u Ensure the A to Z booklet is widely available for young drivers – through the AA Centres, our Driving School and educational institutes. Build on the A to Z booklet using the AA website and broaden the links with the road code quiz and other road code information we provide.

u Encourage learner drivers to participate in the AA Defensive Driving Course (DDC).

Professional driving instruction for learner drivers has long-term benefits by promoting good driving skills, behaviours and positive attitudes.

To enable this, we’re planning to offer a free professional driving lesson to any learner driver who is either an AA Member or a child of an AA Member.

We will need to balance demand for this Member benefit against the delivery capacity of our driving instructors.

The cost of this initiative will be funded from AA Driving School profits supported by AA reserves if required.


u Launch the free driving lesson initiative.

u Consider extending the scope of the free lessons offer to once a year, to relatives of a Member, or multiple lessons.

u Consider extending programme to all learner drivers.

u Encourage other motoring stakeholders to contribute funding enabling every learner driver to have multiple free lessons.

u Investigate extending the free lesson offer to free DDC courses.

Our AA Driving School provides driving lessons using more than 40 franchised driving instructors. This, in conjunction with our Defensive Driving Courses, delivers a cash flow we can use to fund the A to Z learning booklet and contribute towards free driving lessons for learner drivers.

The ability to expand the free driving lesson programme will partly depend on growth in revenue from the AA Driving School, and also developing driver training activity within the corporate sector.


u Ensure the AA Driving School is commercially viable and delivers increased financial returns. Particular emphasis will be placed on developing the commercial sector around the principle of safer driving.

u Employ dedicated AA driving instructors as the primary delivery agent of the free driving lessons in the three main metropolitan regions of New Zealand. This recognises the volume of lessons being provided under the scheme should be able to sustain at least three full-time driving instructors.

u Introduce qualifications to encourage developing the professionalism of driving instructors, lifting teaching standards across not only the AA Driving School but the industry itself.

Driver Education6

Learning to Drive

Free DrivingLessons

DrivingSchool

13 14

Our Foundations

The value Members receive from their Association should always be recognised as exceeding the subscription cost of belonging

• The philosophy behind the Subscription Value Equation (SVE) is to demonstrate to Members they receive greater dollar value from the AA than the cost of their annual subscription, which will validate why Membership is beneficial.

• Our strategy is to increase the SVE at every opportunity. The more we can enhance a positive gap between the cost of belonging and the benefits available, the more Members we will attract. Our Specsavers Member benefit is an example of how the SVE has been enhanced by a $60 eyesight examination with no additional cost to AA Members.

• This SVE philosophy has resulted in a significant increase of AA Membership over the last 20 years. While a range of free services for Members has been introduced, the subscription cost has not been increased. In fact, the average subscription has decreased over the past 20 years with the introduction of the ‘My AA’ tenure-based discount.

• Improving the SVE is our strategic focus. Providing more value than the subscription cost will lead to achieving our vision of AA Membership becoming truly indispensable.

The reason we exist is to meet the service needs of Members

• Service to our Members is our core value. Our range and quality of services is why we have built such an extensive Membership base. As a not-for-profit incorporated society, the AA’s reputation for service and serving our Members’ needs is fundamental to our ongoing success.

• Service is about the Member experience and their perception of what we offer.

• Our objective is to ensure our Members achieve maximum satisfaction with our service and that they recommend the AA to others because of the quality of assistance we provide.

• It is vital to ensure that all activities carrying the AA brand, including our commercial joint ventures, embrace our service-based philosophy. The ultimate success of those activities relies on customer satisfaction and our Members’ expectations with AA branded services.

Members should always feel they receive preferential pricing and

service advantages• The AA endeavours to provide Members with

preferential pricing on products and services. For example, a pre-purchase inspection is a service available to all motorists, but AA Members receive a discounted Member price.

• The more we can build a Member pricing advantage, the more motorists will see the value in becoming a Member and remaining a Member.

• Our strategic priority is to build ‘Member only’ pricing advantages into as many services as possible, whether they are delivered by the AA or by our commercial joint ventures.

• The second part of the Member value proposition is to ensure that Members feel they receive service advantages ahead of non-members. For example, while Roadservice will attend to a non- member subject to roadside joining, attendance is only once other Members’ needs have been met.

• In developing these pricing and service advantages, it is important they are clearly communicated otherwise the value proposition offered plays no part in attracting and retaining Members.

• Our Member-centric focus makes the AA the unique organisation it is, differentiates us from other commercial service providers and builds Member loyalty.

MemberValue

PropositionService

SubscriptionValue

Equation

15 16

Always there when needed, providing consistent service of

the highest quality• Our brand is one of the strongest and most

trusted in New Zealand, it is imperative we invest in maintaining that position.

• The AA brand’s strength comes from our long-standing reputation for providing high-quality, reliable and helpful service. Our visual identity, and the millions of positive interactions we have with Members and other New Zealanders every year, reinforces this reputation.

• Our reputation for service excellence is the backbone of our organisation and has stood the Association in good stead for many years. We’ve grown from 17 regional clubs into a national organisation providing service to nearly 1.4 million Members.

• Our strategic priority is to strive for even greater levels of service, building upon our existing brand strength and positioning the AA as a relevant and leading brand for the next generation of motorists.

• Achieving this requires a clear brand strategy that reflects our core AA values, which are followed by all AA staff and contractors. We will closely monitor the impact of our brand strategy to ensure we are all working towards the same goals.

• We must also continue to strengthen our visual identity, especially around our six cornerstone services. Each of our cornerstone services must reinforce our core values of trust, quality and expertise, while staying relevant to the new generation of motorists.

No other organisation has a database of comparable size

and quality• With more than two million records, one in

every two New Zealanders is on our database. It includes both current and immediate past personal Members, business vehicle memberships, and AA Smartfuel cardholders. Our database reflects the extensive club and commercial activities undertaken by the AA.

• Our emphasis on data quality ensures that contact details are accurate so, with more than 650,000 email addresses, the AA can quickly communicate with those on the database to inform them about services and benefits relevant to them.

• The breadth of information contained in our database provides us with information on how best to customise our services. Our Customer Insight team works with business divisions and joint venture businesses to ensure services and communications are delivered in a relevant and timely way.

• Data security and data privacy are important terms that remind us to responsibly look after the information with which we have been entrusted. We do not allow third parties to contact those on our database directly, we respect people’s wishes about what information they want to receive from us, and we endeavour to keep their information secure from disclosure. Every communication from the AA to those on the database must meet our brand requirements.

Our District Network enables face-to-face interaction between our ‘Members’ and ‘their Association’

• The current district structure reflects the origins of the AA in New Zealand and, in particular, the former Automobile Associations that existed prior to their merger in 1991. Today, it provides the foundation for representing the views of the Membership and is closely associated with the 38 AA Centres across the country.

• We must maximise the contributions of the 17 District Councils, particularly in terms of their views on motoring policy. Their participation in the policy development process ensures the AA’s advocacy is representative of the Membership and takes into account regional perspectives.

• In many communities the AA Centres are the face of the AA, especially when they provide services to the local Members. Our strategy is to maximise the potential of this communication and service channel. Rationalisation may be required from time to time as Membership demographics change and as services vary. However, we should preserve the regional engagement opportunities provided by the AA Centres.

• The cost efficiencies of technology will always challenge bricks and mortar channels. The AA should not undervalue the importance of preserving the traditional face-to-face contact between Members and the AA provided through the District Network.

BrandReputation Database District

Network

17 18

Diminish the dependency on Roadservice as the primary reason

for Membershipn Motoring clubs around the world aspire to find

other services besides Roadservice to attract membership. Dependency on one key service is a risk, especially if an alternative provider enters the market or the demand for that service drops.

n The AA is fortunate to already have a number of services and benefits that, when combined with Roadservice, provide a solid reason for membership. Recently we launched two such benefits – the AA Smartfuel fuel discount programme and the free Specsavers eye examination.

n However, Roadservice is still cited by the majority of Members as the key reason for membership. Technology advances, an increasingly competitive market, and the reliability of modern vehicles threaten the long-term need for Roadservice. Being Number One in Roadservice will no longer be enough.

n Our challenge is to continue to reduce the AA’s dependency on Roadservice by adding new services and benefits to membership. It is critical that the AA brand means much more than just Roadservice.

AA Membership is seen as irrelevant by many young motorists – it is perceived as something for their parents and grandparents

n The average age of our Members is 52. Many Members joined in an era of less reliable vehicles and no mobile phones. Roadside assistance was an essential service and the AA was the only major provider.

n Today’s young drivers typically carry smart phones giving them immediate access to a wide network of friends and tow providers if their car breaks down. They see the AA as one of a number of providers of roadside assistance with often no experience or appreciation of our service unless their parents have been Members.

n With an ageing Membership we need to develop our brand and Membership proposition to appeal to a new generation of motorists, while continuing to provide those traditional services our existing Members value.

n To do this we need to develop a range of services and Membership benefits that appeal to today’s generation of new drivers. We need to engage with the new generation via their channels, such as the internet and social media communities, and we need to demonstrate that the AA is of value to them.

n Attracting a younger affiliation relies on providing new levels of relevance from some traditional services, such as Roadservice, AA Tourism and Motoring Services, and new offerings, such as AA Smartfuel and free novice driving lessons. We must also provide helpful online services which present ideal platforms to build a connection with younger motorists from an early age.

Our ChallengesMore

than justRoadservice

An ageingMembership

Our people are our greatest strength and display the ideals of service,

trust and expertise• The service commitment of those who work for the AA is one

of our most important foundations. Looking in, Members see a not-for-profit organisation that is focused on the values of service, trust and expertise. The AA employee’s perspective, looking out, supports these values but recognises the AA operates in a highly competitive commercial environment where the service to Members and customers provides essential income.

• The challenge is to ensure we build on both the inward and the outward perspectives – we call this the two-way mirror test. The strength of our people is their consistent ability to balance service needs and values against commercial business realities.

• The culture our people create makes them an asset to the AA. Their skill and professionalism are often sought by competitors. Fortunately, many remain as loyal and valued employees. However, that loyalty does not happen by chance – we invest in a working environment that recognises and rewards the performance and contribution of its people. We also develop their competencies for current and future needs.

• Maintaining this culture requires effective leadership and human resource strategies, which are aligned to our values, pass the two-way mirror test and keep abreast of change.

People

19 20

One of the fastest growing challenges to the traditional way of doing business is the march

of technologyn Irrespective of how we have done things in the

past, changing technology means we will have to do things differently in the future. By adapting to and using new technologies, the AA will improve its Member and customer experiences.

n Technology should not be seen as a threat, rather it is an opportunity for us to provide new services and benefits, and in many situations to do so in a cost effective manner.

n We will initially focus on internet and mobile applications, and on alternatives to our traditional delivery methods. We will monitor new and evolving technologies to ensure we are best placed to harness their potential in the future.

n Our challenge will be the pace of technology change, and the consequences of that change to services and resources.

Our governance model must keep pace with the growing dynamics

of the organisation, while retaining the values of our incorporated

society heritagen As an organisation representing half of all New

Zealand motorists, we should endeavour to have the widest possible mix of Members on the District Councils.

n The District Councils’ primary focus is motoring advocacy, and Members wishing to be elected should have a genuine enthusiasm for motoring and focus on what is in the best interests of a membership-based service organisation.

n For the purposes of governance we need to ensure there are individuals on District Councils with the appropriate skills and backgrounds to contribute to the National Council and Board. As we grow in complexity and commercial success, it is essential that those contributing to governance have the professional skills necessary to oversee the AA’s future development and growth.

n Our challenge is to ensure those involved in our governance recognise the unique nature of the AA as a not-for-profit, incorporated society, and value the strength derived from our foundations and service heritage.

One of the strengths of the organisation is its stable senior

management teamn We are fortunate to have a stable leadership

team. Many senior managers have extensive experience and have established their careers with the AA.

n We must ensure that the retirement of any senior manager does not put the AA at risk. Changes within the senior management team should not disrupt the planned growth and development of the organisation.

n While plans are already in place to minimise that risk, as senior managers approach retirement, succession planning and management continuity plans will increasingly become a higher priority.

n Our senior management team is committed to identifying potential talent within the AA and to passing on their enthusiasm and expertise. This will ensure our intellectual property is retained and that knowledge is successfully transferred within teams and across the organisation.

n Our challenge is to balance organisational knowledge and experience with the introduction of new skills and individuals on the senior management team.

Technology GovernanceSuccessionPlanning

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SUCCESS EACH YEAR IS NOT MEASURED IN TERMS OF PROFITS, BUT OUR GROWTH IN SERVICE RELEVANCE AND A GROWING

AA MEMBERSHIP

strategic priorities - aa new zealand€¦ · building customer loyalty to the aa brand. our...

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