Running head: BALANCED SCORECARD AND COMMUNICATION PLAN Strategic Plan Part III: Balanced Scorecard and Communication Plan Christine Wilson BUS/475 February 12, 2018 Ryan Simpson 1 BALANCED SCORECARD AND COMMUNICATION PLAN 2 Introduction The American Family Insurance Group commonly referred to as seeks to introduce a new division in its operations in order to target young motor vehicle drivers. With the number of young drivers rising over the past decade, it’s projected that the new division will improve the financial and national standing of the insurance. Through this balanced scorecard, the company will communicate and analyze the financial, customer, processes, and learning and growth in across the company to the different stakeholders. According to Pearce and Robinson (2013), strategic planning is the process through which businesses set their business priorities, focus their resources and energy in order to strengthen their operations. This strategic alignment according to Pramudita (2016) helps business to attain their mission, vision and specific goals set. By introducing the new operations division which is intended to target the young motor vehicle owners, America Family Insurance Group intends to increase its profits, serve their customers better, improve their operations, and to enhance business learning and growth. To achieve this, maximum participation of all stakeholders is essential. The balanced scorecard will help American Family Insurance Group to analyze and align its financial, customer, processes, and learning and growth with its overall strategy. New Division Balance Scorecard With increased competition in the insurance industry, American Family Insurance Group intends to introduce a new line of operation which will target young customers. By targeting this group of customers, the company intends to increase its market share over the years as it will be easier for the company to retain customers rather than acquire new ones. The balanced scorecard will detail the organization 3 years goal and will be found on how to best address shareholders BALANCED SCORECARD AND COMMUNICATION PLAN best interests. Specifically, the balanced scorecard will be based on the four aspects of the organization strategy which are financial, customer, internal processes, and the learning and growth perspective. American Family Insurance Group Strategy FINANCIAL PERSPECTIVE CUSTOMER PERSPECTIVE INTERNAL PROCESSES PERSPECTIVE LEARNING AND GROWTH PERSPECTIVE America Family Insurance Group Balanced Scorecard OBJECTIVES MEASURES 3 YEAR INITIATIVES TARGETS Overall Increased 5% increase in Provide lower increased profitability will total company insurance earning as new be used as a profit will be the premiums for customers will measure of the target the youths below 30 bring in new financial company will years will be the revenue perspectives. intend to achieve initiative within the next adopted in order five years. to bring in new customers. To benefit the To measure the Decrease motor Decrease customers, the customer new vehicle advertised company will perspective, the premiums by insurance provide low company will 10% in all premiums in insurance seek to have the categories for order to attract premiums. lowest customers below new customers premiums in the 30 years. and to retain the market for old. customers below 30 years The company The company The company To achieve this, will increase its internal internal the company marketing processes processes will rely on the initiatives to perspective will perspective will decrease attract new be measured on target to achieve insurance customers the number of a 13% increase premiums new customers in the number of per quarter year customers To gain a deeper This will be The company Adjust understanding of measured on the intend to recruit premiums the business, the number of new 4000 new payable based company will customers per customers per on market rates monitor the month month to maintain the number of new lowest rates customers 3 BALANCED SCORECARD AND COMMUNICATION PLAN 4 Potential Risks Like any other business, the American Family Insurance Group faces a number of potential risks in the implementation of its new product line. One of the potential risks the company faces is being questioned for fail business practices. With increased competition in the insurance industry, the American Family Insurance Group run the risk of being threatened with unfair business practices for adopting the lowest market prices as part of its strategy to counter competition. The company could be blamed for making it hard for new companies to enter the market since the lowest pricing strategy is a model commonly adopted by new entrants. Mitigation Plan and Stakeholder Analysis According to Narayanamma and Lalitha (2016), mitigation plans are measures put in place by a company to minimize the impact of potential risks the business is likely to face. In order for American Family Insurance Group to effectively address the new risks identified, the company must invest heavily in marketing and promotion activities. Despite the possible negative views towards the new company strategy of lowered costs, the increased marketing campaign will project the company in a positive manner to the customers and the market in general. Ethical Implications One of the ethical issues that could arise with the new pricing strategy of targeting individuals below 30 years will be price discrimination. According to Barney and Hesterly (2015), discrimination is the aspect of selling the same product or service at different prices to different customers. By adopting a pricing strategy which sells insurances to young drivers at low cost compared to the elderly, issues of price discrimination could be advanced towards the company. BALANCED SCORECARD AND COMMUNICATION PLAN 5 Despite price discrimination being socially acceptable in some cases, it could lead to the projection of the company in a negative way. Communication Plan According to Hoover (2010), a communication plan entails actions an organization undertake to fulfill its core objectives. At the American Family Insurance Group, the communication plan will entail how the objectives of the company will be communicated to all stakeholders. The communication plan will be key to informing all stakeholders of how the set objectives will be achieved and how information will be passed within the organization. Specifically, information within the American Family Insurance Group will be communicated through an electronic and manual communication channel. In specific, the company will encourage messages to be sent through departmental intranet channels as this will ensure everyone has access to the information at the right time. Conclusion The intention of introducing the new division by the American Family Insurance Group will go a long way in ensuring the company maintains its key objectives of increasing its customer base and profitability. This is because the firm will be able to raise extra income from the new line of service in the market. In specific, the new department will enable the company to acquire new young customers on its list of customers as it seeks to expand across the US. BALANCED SCORECARD AND COMMUNICATION PLAN References Hoover, C. (2010). The Strategic Communication Plan null [article]. FBI Law Enforcement Bulletin, (8), 16. Narayanamma, P. L., & Lalitha, K. (2016). Balanced Scorecard - The Learning & Growth Perspective. Aweshkar Research Journal, 21(2), 59-66. Pramudita, C. D. (2016). The Balanced Scorecard as Strategic Controlling Instrument. Introducing the Indicators-based BSC for Implementation of a Corporate Strategy from Four Different Perspectives. Hamburg: Anchor Academic Publishing. Barney, J. B., & Hesterly, W. S. (2015). Strategic Management and Competitive Advantage Concepts and Cases, Global Edition. Harlow, Essex: Pearson. Pearce, J. A., & Robinson, R. B. (2013). Strategic Management. Planning for Domestic and Global Competition (13th ed.). 6 Running head: AMERICAN FAMILY INSURANCE GROUP SWOT ANALYSIS AMERICAN FAMILY INSURANCE GROUP SWOT ANALYSIS Christine Wilson BUS/475 University of Phoenix 2/05/2018 Ryan Simpson 1 AMERICAN FAMILY INSURANCE GROUP SWOT ANALYSIS 2 Introduction Business entities in various industrious operate in different environments. The environment in which a firm operates in determines its success significantly. The environment in which a firm may provide various opportunities which a firm can utilize to gain some competitive edge over its rivals in the environment. This way, the business entity can grow significantly hence promote its performance in the industry. The management of a firm also plays a very critical role in determining the success of it in the industry. This way, the firm can outperform its rivals in the market. This paper seeks to explore the SWOT analysis of American Family Insurance Group new division operation. The internal a well as external forces in the environment affecting the operations of the firm in the industry will be analyzed in detail. Discussion American Family Insurance Group intention to introduce a new division of operation in the market seeks to promote its performance in the industry. The new line of service is aimed at improving the performance of the company in the industry (Noe, Hollenbeck, Gerhart & Wright, 2003). This is because the firm will be able to raise extra income from the new line of service in the market. The program will also promote carefulness of young drivers in the market. This way, the number of accidents will be reduced in the country. The affordable rate insurance program for young drivers in the country will also benefit the parents significantly since all the accidents caused by young people under the age of 18 years will be covered in the market. This way, the costs involved in paying for the damage caused when an accident occurs will be reduced. The new line of service targets the youths in the United States since it covers drivers under the age of AMERICAN FAMILY INSURANCE GROUP SWOT ANALYSIS 3 18 years. Introduction of this line of service is a strategy by American Family Insurance Group company in the market to gains some competitive advantage over its rivals in the market. Like any other business entity in the market, the environment in which American Family Insurance Group operates in will greatly determine its performance in the industry (Noe, Hollenbeck, Gerhart & Wright, 2003). The environment in which a firm operates in can be divided into two; internal and external environment. The internal environment entails the workers as well as management of a firm in the industry. The internal forces determine the weakness as well as the strengths of a firm in the industry. The external environment, on the other hand, provides opportunities as well as threats to the operations of a business entity. The American Family Insurance Group operations will, therefore, be affected significantly by both the internal and external environment in which it operates in. The analysis of the environment in which a firm operates in entails its SWOT analysis. SWOT Analysis SWOT is an abbreviated form of Strengths, Weakness, Opportunity, and Threats of a firm. Analysis of these aspects is very crucial in determining the success of a firm in the industry (Kajanus, Leskinen, Kurttila & Kangas, 2012). The analysis also helps a business entity identify the areas it needs to improve on as well as the areas it should keep improving or maintain them. An analysis of American Family Insurance Group new division will, therefore, help it improve its performance in the market hence lead to the achievement of its set goals and objectives. Internal Forces and Trends Consideration AMERICAN FAMILY INSURANCE GROUP SWOT ANALYSIS 4 The internal forces of American Family Insurance Group regarding the new division it has introduced in the market entails the strengths as well as the weakness it has. The identification of these aspects will greatly promote the performance of the company in the market. Strengths. It has very effective strategies that help the firm gain some competitive edge over its rivals in the market. American Family Insurance Group can study the market effective and design strategies that will help it gain some competitive edge over its rivals in the market (Malina, Morrissey, Hamel, Solomon, Epstein, Campion & Drazen, 2017). The company has easy to manage structures which enables the managers to run the operations of its efficacy. Since the firm is well established, it has vast resources which it can use to finance its new service plan in the market. This way, the firm will be successful in the market. American Family Insurance Group has adopted the use of the new technology in its operations, and this has resulted in improved performance in the market. Technology has advanced significantly in the industry hence any firm adopting its use gains some competitive edge over its rival in the market. The system of the company is also very which makes its operations to be smooth and efficient. This way, the firm can outperform its rivals in the market. The firm also has a well-established culture in the market which makes it reputable in the market. The company has effective leadership which oversees its operations in the market. The company also has well-set goals and objectives which guides its performance in the industry. These strengths will help the company implement its new plan effectively hence boost its performance in the market. Weakness. AMERICAN FAMILY INSURANCE GROUP SWOT ANALYSIS 5 Despite having so many strengths, the company has some weakness which lowers its performance significantly in the market. The major weaknesses of the company regarding implementation of the new plan include; lack of enough intellectual property. Since the new division the firm intends to introduce in the market, the company lacks intellectual property to enhance easy implementation of the plan in the market. The company also has poor strategic capabilities which lower its performance in the market. There are also low levels of innovations in the company which may greatly hinder the success of the new plan it intends to adopt in the market. External Forces and Trends Considerations Opportunities. The high number of young drivers in the society increases the market base for the company`s new service hence presenting an opportunity to the firm. The environment also offers new opportunities to the firm hence promoting its performance in the industry. Technological advancement also presents more opportunities for the company as it can use the new technology to boost its performance in the market. Use of innovation in the operations of the firm also provides new opportunities for the firm in the industry. This way, the firm can gain a competitive edge over its rivals in the market. Since the United States is economically developed, it offers various opportunities to the firms operating in the country to improve their performance in the market. As such, American Family Insurance Group can use these opportunities to grow their businesses in the market. Threats. AMERICAN FAMILY INSURANCE GROUP SWOT ANALYSIS 6 High competition in the market is one of the threat American Family Insurance Group faces in the market. Changes in the industry also pose a great threat to the operations of the company in the market. The company is very slow to changes in the environment hence changes in the industry affects the performance of the firm significantly in the market. The laws and regulations adopted by the country to regulate the industry also pose a threat to its performance in the industry (Zelizer, 2017). The global standards for insurance firms also pose a threat to the operations of the company. This is because the firm has to meet the set standards in the market to continue being operational in the market. In developing its strategic plans, the company will have to make various considerations. This way, the firm will be able to operate smoothly in the market. Developing the supply chain in the new division, for instance, will require the management of the firm to study the regulations as well as standards set in the industry to operate effectively. The various stakeholders in the firm will have to be involved to ensure the success of the new division. This way, the firm will be able to gain some competitive edge over its rivals in the market hence boost its performance in the market. SWOT ANALYSIS TABLE. Strengths. Weakness. • Effective strategy. • Inadequate management staff. • Easy to manage structure. • Sometimes the strategies adopted by • Very effective processing systems. • Availability of adequate resources. • Use of SMART goals by the firm. the firm are complicated. • Breakdown of systems AMERICAN FAMILY INSURANCE GROUP SWOT ANALYSIS • Ability to make strategic decisions by • 7 Inadequate resource to enhance the management. carrying out of all the business plans • Good organizational culture. of the firm. • Use of the new technology in the • Hard to understand culture. operations of the firm. • Contradicting goals and weakness. • High levels of innovation. • Poor implementation of strategic plans • Availability of intellectual property. • Use of outdated technology. • Effective management. • Low levels of implementation of innovation plans. • Opportunities. Inadequate intellectual property. Threats. • Favorable laws and regulations. • High levels of competition. • Availability of market in the society. • Inflexible laws and regulation. • Technological advancement • Advancement in technology presents presenting new opportunities. • new threats. Global market for the services offered • Choosy customers in the market. by the company. • Ever changing industry. • Favorable economic conditions. • High levels in the industry increasing • High levels of innovation creating new opportunities. competition. • Unfavorable economic conditions at some times. AMERICAN FAMILY INSURANCE GROUP SWOT ANALYSIS • Increased business opportunities for the firm to venture in in the environment. References. Kajanus, M., Leskinen, P., Kurttila, M., & Kangas, J. (2012). Making use of MCDS methods in SWOT analysis—Lessons learnt in strategic natural resources management. Forest Policy and Economics, 20, 1-9. Malina, D., Morrissey, S., Hamel, M. B., Solomon, C. G., Epstein, A. M., Campion, E. W., & Drazen, J. M. (2017). health, Wealth, and the Us Senate. Noe, R. A., Hollenbeck, J. R., Gerhart, B., & Wright, P. M. (2003). Gaining a competitive advantage. Irwin: McGraw-Hill. Zelizer, V. A. R. (2017). Morals and markets: The development of life insurance in the United States. Columbia University Press. 8 Strategic Plan Part I: Proposal of a New Division Strategic Plan Part I: Proposal of a New Division Christine Wilson BUS/475 January 29, 2018 Ryan Simpson 1 Strategic Plan Part I: Proposal of a New Division Conceptualizing a Business Business mission statement communicates the company’s core ideology and visionary goals. This statement consists of several components namely core values, core purpose and visionary goals. Mission statement is important in a business because it takes control of your business and accepts responsibility for their decisions they make. A business vision is basically a proactive approach towards business, and by formulating a vision for a successful business as well as relating it to the employees and the public. American Family Insurance Group is a Fort Lauderdale Based insurance industry company. The company is the benchmark of insurance economic growth. Ask anyone at the company the secret to the Company’s seven decades of success, and they will give two answers VALUE and CULTURE. It is a corporate philosophy that combines bravado with old-fashioned business sense. Strive to do better than the competitors, hire only those who can surpass you and be bold but sure you’re willing to deal with consequences. At American Family Insurance Group, if something seems easy, it’s probably wrong. “Every morning in Africa, a Gazelle awakes. It knows that it must run faster than the fastest Cheetah or it will be killed. Every morning in Africa, a Cheetah awakes, it knows it must run faster than the slowest Gazelle or it will starve to death. It doesn’t matter whether you are a Cheetah or a Gazelle: When the sun comes up, you had better be running.” This is one of the many American Family Insurance Group mission statements that clearly demonstrates on where and what the company will become in the future. American Family Insurance Group knows that lasting success does not come about merely as the result of fortuitous coincidence. It happens through the focused hard work of the people. The above and beyond performance of the employees makes the difference and drives 2 Strategic Plan Part I: Proposal of a New Division favorable result against an unprecedented headwind. The company is committed to making a difference in the insurance industry and the culture intrinsically tied to it were not created overnight. American Family Insurance Group’s emphasis on the development of its employees and values came with the realization of this simple fact. At the end of the day, almost all of the company’s assets go home. Unlike manufacturing operations, where the assets are fixed, American Family Insurance Group relies almost completely on its employees to create value. If the employees do not come back the next morning, the company has lost most of its assets. For this reason, the company is committed to enhancing its employees personally, professionally and financially. American Family Insurance Group, a division of Hull and Company Inc. is a wholesale insurance intermediary providing specialty products and unique solutions to the independent agency system. The company is guided by strong ethics, honesty and professionalism. Their goal is to deliver insurance products at competitive terms, with financially sound markets, on a timely basis. American Family Insurance Group strives to consistently exceed the expectations of their customers, employees, insurance markets and shareholders. The results of their efforts are to make a profit for all concerned. This mission statement helps the company formulate strategies that are ethical in all aspects and it is crucial that the company doesn’t put the culture ahead of ethical behavior. When a company’s culture spawns an ethically corrupt or amoral work climate, people will have a license to ignore what is right and engage in almost any behavior or employ almost any strategy that they think they can get away with. American Family Insurance Group has a social responsibility to doing what is right at all times. The company is a lean, decentralized, highly competitive, profit-oriented sales and service 3 Strategic Plan Part I: Proposal of a New Division organization comprised of people of the highest integrity and quality bound together by clearly defined goals and prideful relationships. Vision and mission statement are extremely important in providing a strong framework and guideline to the overall strategic plan at American Family Insurance Group. This ensures that the company’s employees and management have a clear vision of what’s to come and the objectives of the company. Everyone at the company recognizes that the only constant is change, and this is the hallmark of a healthy, growing company. Competition and beating your competition is what makes American Family Insurance stand out. The company motto “Behind is not a good place” is well documented within all departments. This is one of the reasons they seek people who are analytical, high energy, driven by a money-making gene and satisfied with being respected rather than loved. Executives aim to hire people who are better, smarter and more aggressive than they are, ensuring that each generation of employees exceeds the one before. Recruiting and enhancing outstanding employees is at the core of American Family Insurance Group’s corporate culture. In 2003, the company codified its culture and business standards into a rigorous internal training course called “American Family Insurance Group University”. The training school was designed to nurture employees and help them reach the upper levels of success. At American Family Insurance Group, they know that they must be as agile as the cheetah in order to thrive in the currently very competitive insurance environment. Their unique culture has enable them to quickly chase down new opportunities, adapt to new products and service to best market demands, and satisfy many varies clients. Social responsibility, as applied to American Family Insurance Group’s business behavior, balances strategic actions to benefit shareholders against the duty to be a good corporate citizen. The managers must display a social 4 Strategic Plan Part I: Proposal of a New Division conscience in operating the business and specifically take into account how management decisions and company actions affect the well-being of employees, local communities, and society at large. In conclusion, the drive to be the best has made American Family Insurance Group one of the largest and most respected independent insurance intermediaries in the nation, with over 5,400 employees, 69 years of continuous and annual sales approaching $1 billion. In order to survive, the Cheetah is always looking for its next meal. Like the Cheetah, American Family Insurance Group is always looking for way to grow and survive. . 5 Strategic Plan Part I: Proposal of a New Division References Bbinsurance.com Chapter Three: Corporate Social Responsibility and Business Ethics: Strategic Management. Formulation, Implementation, and Control 11th Edition www.business-ethics.com Chapter Seven: Strategy, Ethics, and Social Responsibility; Thompson-Gamble-Strickland Winning in the marketplace 2nd edition. 6 
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