Company overview
Aflac Incorporated is a company that is based in the United States. Its operations are in the line of the insurance industry. The company is based in Columbus, Georgia. Aflac was founded in 1955 by three brothers: William Amos, Paul, and John. The name of the company was the American Family Life Insurance Company of Columbus before it changed the name in 1964 to become the American Family Life Assurance Company of Columbus.
The initials Aflac were adopted in 1990. Aflac signed over 6, 000 policy holders in its first year of operation. It was the first company to provide insurance cover for cancer in 1958. Aflac started to offer policies on payroll deduction in 1964. Over 98% of its policies in the US were on payroll deductions as at the year 2003. It is due to this achievement that Aflac became a leader in policy distribution through payroll deduction approach.
The American Family Corporation is a holding company for Aflac and it was established in 1974. It is important to note that Aflac operates both in the United States and Japan, but its headquarters is in the US. Among the types of insurance covers that it offers include: accident, cancer, life insurance, hospital intensive care, dental insurance, vision, short term disability, lump sum cancer, critical illnesses, and hospital confinement sickness indemnity (Time Inc., 2012).
How the Aflac uses its own products and services to enhance the total compensation for its employees
Companies should embrace the act of compensating their employees well to remain competitive. Compensation and rewards have become very significant factors in the competitiveness of companies. It is the responsibility of the HR managers to keep their companies in the competition through attractive compensation packages (McGregor, 2008). Aflac has developed a way of using its products and services to enhance employees’ compensation.
For instance, the company provides 100% insurance cover for cancer to its employees as part of reward or compensation. This is a service that is usually sold as a product. The cover was integrated in the reward system for Aflac employees. Aflac also focuses on offering its services to employees at no cost. It is a motivator for employees and an act that can make them improve on their productivity.
In addition, Aflac supports its employees socially. The company shows the employees that their lifestyles are significant to the company. This social commitment that the company offers as a service to its employees led to the development of an on-site child facility that is regarded as the largest in the United States (Reed, 2009). Aflac enhances total compensation of its workers by providing insurance cover sold as a product and the social support being a service to its employees.
Internal strengths and weaknesses
The company has a number of internal strengths that have given it a competitive advantage over its competitors. For instance, there is effective communication within the organization because the management is able to communicate with its employees and consumers effectively.
There are good communication systems that the management has utilized efficiently to improve communication in the organization. There is also a strong management team. The top, middle, and lower level managers at Aflac are all well equipped with knowledge and skills that enable them to perform their duties comprehensively.
The company is able to attract talented managers who, in turn, bring a lot of input into the business as a result of its good compensation scheme. The company responds to this by rewarding the employees better for their performance, thereby motivating them to perform even better. The company also has customers who are loyal. Over the years, Aflac has been able to build a strong brand image and attract customers who are loyal. The customers buy its services and the company gets money to reward its employees (Reeves, 2010).
There are also some weaknesses that have pulled back Aflac’s operations. There is an inefficient work environment that has the ability to reduce the utilization of goods and services at Aflac. However, the company has been working to improve the inefficiencies and create a better environment for its employees.
The company is also said to have a debt burden. This might increase its risk of being bankrupt. Aflac has, however, been making all possible efforts to reduce the debts. Paying the debts will help the company reward its employees effectively (Hiebing, Cooper & Wehrenberg, 2012). Finally, Aflac has a higher cost structure compared to that of competitors, but it has positively responded to this challenge to maintain its competitive advantage.
External opportunities and threats
Aflac has a number of opportunities that can help it improve its performance in the future. For instance, the company can increase its premium rates. This will help it increase its profitability and financial position. Aflac will be able to reward its employees better. The demographic trends also represent an opportunity for Aflac. The demand for its services increases as the population increases. This will further strengthen Aflac financially and improve its rewarding ability (Time Inc., 2012).
Threats that Aflac faces are likely to affect its rewarding ability since they will have a negative effect on its performance. Insurance frauds are mounting and they are likely to affect Aflac negatively. The company’s employees will be on the receiving end once the company is affected by insurance frauds. The employees will have a bad image and fail to be rewarded accordingly. Natural catastrophes are also likely to affect the company. They will affect its performance and its rewarding ability.
Traditional and non-traditional rewards
Traditionally, companies used to reward their employees with money and allowances. Time off and retirement benefits are other forms of traditional rewards.
Aflac gives its employees these traditional rewards. However, it has coupled these with non-traditional rewards that include insurance for its employees, coaching and mentoring, counselling services, as well as financial planning services. These rewards motivate the employee. The employees, in turn, improve on their productivity, thereby giving the organization a competitive advantage (Addy, 2011).
Corporate values
Aflac believes that it can only succeed if it can treat people well and with respect. It, therefore, treats its employees with a lot of care, fairness, and dignity (Reed, 2009). These are the corporate values embraced by Aflac. The company improves on its employees’ treatment as it makes more profit. Consequently, it has been able to attract employees since they are assured of good treatment.
Recommendations
Aflac operates in a competitive industry. Human resources are the most valuable organizational assets, thus they have to be treated well if the company is to survive the competition. Aflac should, therefore, expand the benefits it offers to its employees. For instance, it should extend insurance cover to the spouse and children of employees. Aflac should also give special rewards for exceptional performance from employees to encourage better productivity.
References
Addy, M. E. (2011). Rewards: An autobiography. Kaneshie-Accra, Ghana: Amanza Ltd.
Hiebing, R. G., Cooper, S. W., & Wehrenberg, S. (2012). The successful marketing plan: How to create dynamic, results-oriented marketing. New York, NY: McGraw-Hill.
McGregor, J. (2008). The right perks. Business Week. Web.
Reed, S. M. (2009). Benefits and business at Aflac and L.L. Bean. Society for Human Resource Management. Web.
Reeves, L. (2010). Rewards at work inspiring productive employees across career stages. Web.
Time Inc. (2012). Aflac history. Aflac. Web.