Aviva 2007 Annual Report Download - page 17
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Aviva plc
Annual Report and
Accounts 2007
13
Business
review
– Developed a clear framework for capital
allocation, based on strict financial, strategic,
capital management and risk management
evaluation criteria
– Invested in selected high growth / high margin
opportunities (e.g. partnerships in Turkey,
China, Italy, Spain)
– Divested underperforming businesses
(e.g. Dutch healthcare)
– Maintained progressive dividend policy
– 2007 return on equity shareholders’ funds is
below our target of 12.5% as explained on
page 15
– Focus on realising the full potential of Aviva’s
existing businesses
– Maximise diversification benefits in the
Solvency II environment
– Continue progressive dividend policy
2007 Progress
What we achieved in 2007 against
these priorities
2007 Measurement/KPIs
How we measure progress against
each strategic priority
2008 Priorities
What we are focused on in 2008
Allocate capital rigorously:
– Improved on 2006 customer scores, exceeding
customer targets set to increase customer
reach by:
– Improving customer loyalty
– Encouraging customer advocacy
– Gained access to over 50 million potential new
customers through bancassurance deals
– Entered new markets via JVs in Malaysia and
Taiwan, and expanded in our existing markets,
for example, through new distribution in Italy,
Turkey and Russia
– Further developed the Aviva brand through
advertising campaigns across our regions
– Rapidly grow in high growth markets
– Continue to build access to customers through
bancassurance, partners, agencies, sales forces
and direct distribution
– Refresh brand positioning
– Implement a variety of customer initiatives,
including UK customer services improvement
programme (”One and Done”)
– Roll out TCF (Treating Customers Fairly)
internationally
2007 Progress
What we achieved in 2007 against
these priorities
2007 Measurement/KPIs
How we measure progress against
each strategic priority
2008 Priorities
What we are focused on in 2008
Increase customer reach:
– Met our targets on a number of major cost
saving initiatives across the group:
– £250 million annualised cost savings from
UK cost and efficiency review
– £130 million from RAC integration
– £23 million from US integration
– Announced a further set of cost saving
initiatives (see 2008 Priorities)
– Simplify technology landscape
– Increase use of shared services
– By end 2008 we will have achieved:
– £200 million UK GI cost savings
– By end 2009 we will have achieved:
– £100 million UK Life cost savings
– £50 million Aviva Europe cost savings
2007 Progress
What we achieved in 2007 against
these priorities
2007 Measurement/KPIs
How we measure progress against
each strategic priority
2008 Priorities
What we are focused on in 2008
Boost productivity:
Group target
0.0
4.0
2.0
8.0
10.0
12.0
14.0
6.0
2006 2007
%
Return on equity shareholders’ funds
13.1%
11.3%
12.5%
0
200
100
400
300
UK Cost &
Efficiency
RAC
Integration
US Integration
UK Life
UK GI
Europe
Tota l
800
700
600
500
Cost targets
£m
Cost initiatives underway
New cost targets by 2009
0
4
2
6
UK Europe Asia
Pacific
12
14
8
10
%
* North America excluded due to the early stages of this work
following AmerUs integration
** Asia Pacific shown against target as first year of introduction
Average extent to which 2007 local
customer measures improved on 2006*
14%
3% 4%**