Abstract
Business firms are faced with different legal, social and economic issues in industries they operate in. These issues influence the way a business firm performs in a particular industry. Every business firm needs to put in place effective business strategies to ensure its operations run smoothly without any disruptions.
A business firm also needs to take note of internal human resource factors that have a direct effect on overall performance. There are external factors which also influence the manner in which a business firm operates. A business firm needs to put in place risk management measures to help it deal with factors that are likely to impact on its operations negatively.
Elite Insurers is a firm that provides different insurance services to its clients in the country. The firm serves both individual and corporate clients who have subscribed to different policies offered by the firm.
I have worked in the firm for the last four years which has contributed positively to my career growth. Crown Insurance Company also operates in the same industry and has managed to create a positive impact on its customers. This paper will compare and contrast these two firms by analysing different factors that directly affect their operations.
Elite Insurers has been in existence for the last 15 years. The firm has managed to stand out in the industry because it has diversified its products. The firm targets a wide variety of customers in different markets which has contributed positively to its revenues. The management encourages collaborations between senior employees and their subordinates.
As a result, the firm’s internal work processes are more efficient because all stakeholders are willing to contribute their ideas to solve different problems. The firm’s employees have regular meetings where they brainstorm and come up with common solutions to different problems which the firm faces (Griffin & Moorehead, 2011, p. 67).
Crown insurance has a different working system. Human resource practices observed in the company give workers more autonomy to make decisions that impact on the way they perform their duties. As a result, the firm has efficient working systems that delegate authority to workers to make them more responsible in their duties. This approach serves the firm’s needs more effectively because it encourages workers to be more creative in their workstations.
Crown Insurance has benefited from its lean management team which consists of highly qualified individuals who have multiple professional skills. This firm’s management is visionary and more responsive to different changes in the industry (Griffin & Moorehead, 2011, p. 76). This has increased the brand appeal of its products in different markets.
Elite Insurers’ business strategies have focused mainly on strengthening the value of its products in different target markets. The firm conducts performance appraisals and reviews on its employees after every three months to determine their commitment and diligence. These reviews are used to evaluate each individual’s suitability in the role he or she has been assigned in the firm to ensure all workers perform their tasks effectively.
Employees who excel in their duties are rewarded with promotions to motivate them to achieve better results in future. The firm has also put in place effective systems that nurture and develop talents in different employees to prepare them for future leadership roles (Kolb, 2008, p. 89). As a result, the firm’s HR policies encourage employees to acquire multidisciplinary skills to make them more suitable for different responsibilities.
Crown Insurance companies focuses on building strong networks with its clients and other firms in the industry. This approach has allowed the firm to improve its internal systems to help it cope with different trends which are taking part in the industry. The firm uses customer feedback to rate its employees to find out if they are able to satisfy its clients’ needs in the market. Employees who get positive reviews from customers are given advancement opportunities in the firm to motivate them.
The firm also hires external HR experts who are not biased to assess the performance of its junior and middle management staff. All employees in the firm are encouraged to accept different changes made to their working systems and this has increased the firm’s strength in the industry (Rue & Byars, 2003, p. 78). All employees are made aware about proposed changes and their likely benefit to the firm before they are implemented.
Even though Elite Insurers encourages collaborations between workers and their superiors, the firm’s management style is rigid. The firm has several branches in different cities across the country. The firm lacks a clear communication policy that outlines how different functions are to be performed by its employees. Therefore, this slows down crucial work processes, a factor that has dented consumers’ confidence.
The firm relies on advanced internet-based communication tools to engage with its clients and business associates. However, the firm has failed to put in place high quality communication systems to enable employees in different branches to interact freely. As a result the firm’s senior managers are not able to monitor different functions that are performed in its branches (Rue & Byars, 2003, p. 86). The firm needs to restructure its operations to help it take advantage of new opportunities in the industry.
Figure 1: Elite Insurance SWOT analysis
Crown Insurance has a lean management structure located in the city. The firm’s communication policies encourage workers to communicate with each other more openly even though they are given more autonomy to perform their responsibilities.
The firm’s customer service department is not well staffed because many consumers have to wait for a long period of time before their queries are answered. The firm’s managers are also rarely in contact with their subordinates and this makes it difficult for junior employees to understand the firm’s vision in the industry and their roles.
Managers in the firm communicate with their subordinates through memos and notices, which makes it difficult for workers to interact with them (Jones & George, 2006, p. 89). The firm’s business strategy mainly focuses on attracting corporate clients in different sectors of the economy. This has allowed it to come up with products that satisfy clients’ needs in its main client segments.
Figure 2: Crown Insurance SWOT analysis
There are changes in external conditions which are impacting negatively on the performance of both firms in the industry. Elite Insurers has been affected by the entry into the market of foreign firms which has reduced its market share in the industry. The firm has also had to contend with a reduction in consumer spending power in the country which has made many of them to opt for low cost insurance plans. As a result, the firm has registered low sales volumes which have reduced its profit revenues.
The introduction of new taxes by the government has increased the cost of doing business in the country (DuBrin, 2003, p.123). As a result this has reduced the firm’s future profit projections. Government authorities have also put in place stringent rules to govern the financial services sector. These rules have made the firm to readjust its services; a decision that has elicited negative reactions from its loyal customers.
Crown insurance has also been affected by the introduction of new government regulations which have affected its operations in the market. The firm has also been negatively affected by new taxation laws which have reduced the amount of profits it gets in the market. As a result, the firm has been forced to shelve plans to expand its operations into new consumer market segments.
The firm has also been negatively affected by foreign currency instabilities which have weakened its financial position. There is a shift in consumption habits which have made more corporate firms to prefer flexible insurance plans (Butler, 2012, p.45). This has affected the firm’s future profit projections in the industry. As a result, the firm has not been able to improve its internal systems to take advantage of new opportunities in the market.
References
Butler, D. (2012). Business planning: A guide to business start-up. New York, NY: Routledge
DuBrin, A.J. (2003). Essentials of management. New York, NY: Thomson.
Griffin, R.W., & Moorehead, G. (2011). Organizational behavior: Managing people and organizations. Mason, OH: Cengage Learning, 2011. Print.
Jones, G.R., & George, J.M. (2006). Contemporary management. New York, NY: McGraw-Hill.
Kolb, B. (2008).Marketing Research: A Practical Approach. London, UK: Sage Publications.
Rue, L.W., & Byars, L.L. (2003). Management: Skills and applications. New York, NY: McGraw-Hill.