Making the most of JVC and KENWOOD technologies and know-how to become a partner who creates new value while delivering outstanding solutionsThis fiscal year marks the second year of JVCKENWOOD Group’s “Vision 2020” Mid- to Long-term Business Plan, which was launched in May 2015. Under Vision 2020, we have chosen ROE as our principal management indicator; we have also implemented performance evaluation and business portfolio management by making ROIC an internal management indicator. As the result of these changes, we are now in a position to shift our management focus to our strengths, and embark on the process that will see us evolve from a manufacturer/distributor into a company capable of creating customer value by providing solutions to issues confronting our customers.
To realize this vision, management of our business portfolio will be based on factors such as alignment with our long-term vision and capital profitability. We will divide our businesses into three categories: growth-leading businesses, profit-base businesses, and others, allocating management resources and conducting strategic M&A tailored to the characteristics of each business category. We intend to conduct growth investment in the growth-leading automotive sector, backed by stable income from the profit-base public service and media service sectors. As we transition our business structure to one that can achieve strong profit growth over the long-term, the public service and media service sectors will function as the foundation and the automotive sector will generate approximately one-half of our profits.
◆ Fiscal Year Performance
For the fiscal year ended March 31, 2016, our sales and operating profits fell short of our initial expectations – an outcome that was due to factors including the sharp drop in oil prices, which led to a decline in sales of professional radio devices to the US rail industry, as well as the higher than anticipated advanced R&D costs to accommodate large new orders in the automotive sector (dealer option). That said, the global structural reforms implemented through the end of last year have been bearing fruit. Specifically, the conversion of our business from analog consumer electronics to digital solutions, the development of next-generation businesses, and M&A have allowed us to achieve an annual net profit for two consecutive years while simultaneously laying the foundation for future growth.
◆ Achieving our vision for 2020
The JVCKENWOOD Group will be managed via a matrix of five regions and three business sectors in accordance with the new management structure approved by the 8th Ordinary General Meeting of Shareholders. To ensure that management is agile, each business sector as well as each of the five regions will be led by a chief operating officer (COO) responsible for operations in their respective areas. Under this new management structure, we will continue to strive to grow our existing businesses while applying our collective audio, video and communications technologies and know-how to promising and socially significant sectors such as automotive and health care. We will boldly advance our new growth strategy and proactively work to anticipate customers’ issues, playing the role of a valuable partner offering cutting-edge solutions.
◆ Earning social trust
We believe that a company seeking to achieve sustainable growth must first meet the expectations of its stakeholders and then, through unflagging efforts, earn the trust of society.
JVCKENWOOD Group endeavors to be a company that has earned the trust of its many stakeholder groups, including consumers and corporate clients. We will achieve this goal by working as a single, unified team and leveraging on our strengths to improve the quality of all corporate activities, products and services; raise our competitiveness; and contribute to society.
Simultaneous with these efforts, we will demonstrate our commitment to future generations by enhancing our community-based social contribution and environmental conservation activities.
Drawing on the experience of the Great East Japan Earthquake, we will further reinforce our crisis management system, as well as strengthen organization-wide initiatives for business continuity and measures to address significant risks to management.
We are confident that the complementary strengths of our respective technological assets and experiences will allow JVCKENWOOD to become a partner creating new value and expert solutions for our customers.
KENWOOD ELECTRONICS TECHNOLOGIES (M) SDN BHD
+60 7 237 1297
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