Bridgestone Corporation has outlined details of its Mid-Term Management Plan for 2012 (MTP2012), covering the five-year period from 2013 to 2017. MTP2012 reflects changes in the operating environment since the formulation of MTP2011, and revises and adds additional strategies and measures as deemed necessary.
The company notes its ultimate goal is to become the “undisputed world number one tyre and rubber company in both name and reality.” The executive management team continues to view mid-term management plans as fundamental and key to management, therefore MTP2012 incorporates the articulated vision of the team to accelerate management reforms.
Bridgestone asserts it is making strong progress toward accomplishing its immediate management goal of achieving return on assets (ROA) of 6% in 2012, but acknowledges that the operating environment it faces is growing increasingly unstable and uncertain. In the course of developing MTP2012, the group therefore identified the current operating environment as a critical time to advance further management reforms.
Following the initial reforms to the group’s governance and operations which were begun in 2006, management reforms to be implemented going forward are defined as “second phase” transformational reforms. In order to effectively address the challenges of the current environment, and the challenges that will be faced in the future, the group will implement reforms centred on the principles of flexibly responding to economic fluctuations and creating new value for customers. Through these efforts, the company’s goal is to become the absolute and clear leader -in Japanese, ‘Dan-Totsu’ – in all its industries. One particular area of focus will be leveraging the benefits to be realised through vertical and horizontal expansion. It will add further depth to initiatives implemented last year and accelerate its progress in these areas through a commitment to technology and business model innovation.
Technology innovation will focus on raw materials – diversification of natural rubber production and shift from fossil resources to renewable resources; products – enhancement and expansion of strategic products that demonstrate technological superiority, 100% sustainable material concept tyre and air free concept tyre; and services – tyre technology which provides drivers with real-time information regarding road surface conditions and tyre printing technology.
Business model innovation will focus on fleet solution – solutions package proposals combining new tyres, retread tyres, and maintenance services; and mining solution – new customer value created by combining Bridgestone products and services.
MTP2012 performance targets are as follows: ROA of more than 6%, “improve further” as target; net revenue – yearly average over 5% increase; operating income ratio – achieve 10% as early as possible, “improve further” as target; and capital expenditure – yearly average ¥250.0bn (US$3.15bn), approximately 50% for tyre strategic projects.
