Qantas 2009 Annual Report Download - page 14

It is a privilege to lead more than 35,000
Qantas Group employees. These are difficult times,
and yet our people have responded with skill,
imagination and goodwill to all that we’ve faced.
Restoring our Reputation
During the first half of the year we encountered a
confluence of events that affected our reputation
negatively. Two inflight incidents, QF30 in July
2008 and QF72 in October 2008, attracted
widespread attention. Preliminary findings from
independent authorities found no suggestion that
Qantas safety was a cause. Our customers also
experienced punctuality issues deriving from a
long-running engineering industrial dispute and
subsequent maintenance backlog, and this led to a
shift in perception that Qantas had reduced its
commitment to safety.
We worked hard over subsequent months to
assure our customers that safety is, and will always
be, our first priority. With 5,500 engineering
employees in Australia, Qantas spends $1.4 billion
each year on the safety and performance of our
aircraft, with between 80 and 90 per cent of all
Qantas aircraft heavy maintenance carried out in
Australia. Our decision to undertake heavy
maintenance work on our A330 fleet in Brisbane
secured more than 500 jobs.
We have brought our on-time performance
back to industry leading standards and
achieved significantly improved customer
satisfaction ratings.
We will never take our customers’ confidence
in us for granted, and continue to put safety at the
forefront of all we do.
Managing for the Long Term
During the second half of the year, the
Qantas Group experienced the adverse effects
of the downturn in the global economy.
While managing effectively through the short
term, we are equally focused on achieving our
long term objective of being the world’s best
premium and low fares airlines, delivering
sustainable returns for our shareholders.
We have emerged as one of the few airlines
worldwide to deliver a full year profit this year,
and we have more than 160 new aircraft on order
over the next 10 years.
Two Brand Strategy
The Group’s two flying brands give us unique
strength in terms of scale, network and customer
reach. As you can see in our case studies on
page 27, we derive significant benefit from our
capacity to match capital and resources to
changing customer demand.
Qantas remains Australia’s carrier of choice
for premium and corporate travellers. We continue
to invest to deliver an outstanding experience for
customers. On pages 34 and 35 you can see a
sample of improvements made to the customer
journey, from a better online experience, to airport
lounge refurbishments, upgraded fleet and
better network connectivity.
In December last year we opened our
$10 million Centre of Service Excellence to ensure
our people deliver consistently excellent service.
The introduction of the A380 during the
year was a clear success, achieving exceptional
customer satisfaction ratings.
Jetstar is the Qantas Group’s low fares brand
and has become the world’s largest low fares, long
haul carrier. In May 2009, Jetstar became the
second largest carrier of passengers to and from
Australia after Qantas.
It has achieved outstanding growth over five
years and cemented its lowest fare market
position. During the year, Jetstar grew strongly,
including by picking up capacity as Qantas
withdrew from underperforming routes, and
growing its Asian and intra-Asian operations. The
Group increased its ownership in Jetstar Asia and,
with a simplified ownership structure providing
greater strategic alignment, this will provide a
platform for future growth in the world’s highest
potential aviation market.
The Frequent Flyer business is Australia’s
number one loyalty program, achieving standout
returns during the year. With the successful launch
of the new Woolworths alliance, Qantas Frequent
Flyer has now passed six million members and
more than 400 partners. The Group has ruled out
an initial public offering of the business,
recognising the strategic value of the loyalty
program’s continued integration within the Group.
Transforming for Sustainable Success
Looking ahead, the leadership team is focused
on creating a lean and responsive organisation.
We have stripped back management layers to
speed up decision-making and to give our frontline
people more power. We are working internally,
and with suppliers, to lower our cost to serve, and
to streamline business processes. We are listening
to our customers, and engaging our people to
deliver consistently excellent service. In these
challenging times, we are seizing the opportunity
to transform for sustainable success.
I
n these challen
g
in
g
times,
w
e are seizin
g
the
opportunity to transform
f
or sustainable success.
Alan Jo
y
c
e
Chie
f
Executive O
ffi
cer
12 Qantas Annual Report 2009