Strengths and Weaknesses of CIC Organisation - Case Study Example

Introduction Human resource management department is very essential in every organisation. This is more so in relation to planning and implementing ideas. One of the major tasks of the human resource managers is to monitor both the internal and the external environments of their organisations. There are various tools that are used to audit an organisation and its environment. They include swot analysis, five forces analysis and pestle analysis. The following facts were accrued from CICs case study. (Kotler, 1996) SWOT analysis Strengths Strengths within an organisation always refer to positive aspects therein. This could be related to how an organisation is aligned to face challenges in the market. It may also refer to strategies that have been put in place in order to increase an organisation’s market share. (Kotler, 1996) An organisation could be well aligned in term of human resources therein, technology wise or even service delivery. A thorough analysis of the Chester Insurance Company shows that there are various strengths within the organisation. One of them is the fact that it is technically focused. In this case, it means that the organisation is well aligned in terms of updated technology. (Albrecht, 2000) The management in Chester Insurance Company has ensured that all employees are well trained on issues of information technology. Outdated operation software has been changed so that it can offer better services to its customers. The organisation has also invested in better equipment and machineries like laptops. This is a real strength therein. CIC is also an organisation that is process driven. This means that its processes have been tailored in such a way that they are effective and efficient. They are shorter processes that are simplified and therefore customers do not find them a problem. This connotes that the organisation’s processes are not complicated that customers and employees cannot handle or effectively deal with them. Having a large customer base is strength of the organisation. CIC has increased its customer base to approximately seven million customers. This means that the organisation has a big market share within the business environment. (Reilly and Tony 2006) When an organisation has a big market share, it means that it its risks have been widely and effectively spread. Chester Insurance Company therefore also boasts of the goodwill it enjoys in the market. In this case, customers simply prefer to get services from the organisation than its competitors. When customers hear the name of the organisation, success automatically rings in their minds. Goodwill is a strength quality within an organisation that the management needs to exploit because it is an aspect that it subject to changes. CIC has assets worth 32 billion dollars and this is great strength for the organisation. (Boudreau and Ranmstad 2007) Weaknesses Weaknesses within an organisation may refer to aspects that generally deter it from achieving its objectives. Many weaknesses within an organisation may crop up when the management fails to implement the set policies. It could also mean that policies enacted are not well aligned to overall achievement of success. Chester Insurance Company has weakness of retaining staffs. The reasons as to why an organisation may not be in a position to retain its staff may be so many. This includes having poor employee remuneration comparing to competitors. This results in employees always looking for the greener pastures. It could also mean that the working environment within the organisation is not conducive compared to that in other organisations. The fact that CIC cannot retain its customers means that it has these issues as well. (Marchington, 2005) When an organisation losses staffs, it is negatively affected because it had invested so much in them in terms of training. Getting new staffs is costly in terms of time and finances. This of course is hindering the organisation to exploit its maximum potential as far as success is concerned. These factors have made it hard for the organisation to attract new employees. (Garth and Jennifer 2000) Another weakness within CIC is having a hierarchical culture. This can also be referred to as a bureaucratic organisation. This is whereby there is a very big divergence between the top management and the rest of the employees. With such a culture in an organisation, there is time wastage and delays as employees have to follow strictly laid down rules and regulations. (Kotler, 1996) Bureaucracy also results in rigidity and ignores employees’ feelings and emotions. This in the long run negatively affects the overall performance of an organisation. The culture within CIC shows that it is male dominated. This means that the management have more confidence in male employees. It also means that promotion is on the basis of sex and not performance. This is quite demoralising and also has negative impacts on the success of the organisation. (Anthony, 2006) It was also noted that while it may be a strength that CIC has a big customer base, most of them are small income earners. This in the long run becomes a weakness. This is because the small income earners pose a great risk when their income deteriorates. This will mean that CIC may have an increased risk portfolio. (Kotler, 1996) Chester Insurance Company has a weakness related to its style of management. The management style therein can be termed as very poor. This is because there is bullying of junior employees by executive managers. This can actually be referred to as a traditional style of management that never produces good results. The managers in CIC also use coerciveness even before exploiting all the other available means of making employees carry out tasks. This has resulted in a situation whereby employees feel oppressed and not heard. (Mark, 2001) This weakness has in the long run affected the overall output of employees and the organisation at large. Dictatorship is also being used in the organisation because management even stipulates how employees refer or address each other. Failing to address a person by name leads to lack of identity and even customers won’t be able to know who is who! It is a weakness within CIC to be run by actuaries. Promotions should not be in relation to how long one has worked but also how one performs. Opportunities These refer to aspects within the external environment that an organisation needs to take advantage of in order to reap maximum profits. Marketing and human resource managers always need to look out for opportunities in the market that the organisation can actually exploit. (Mark, 2001) Chester Insurance Company has the opportunity of increasing its customer base of high income earners. In this case, the organisation can develop new products that can target high income earners. CIC can have offices or branches that are specifically high income earners where efficiency and effectiveness is upheld. This can make the rich people in the nation. The organisation has the opportunity of tailoring its services in order to appeal to the high income earners. As Chester Insurance Company increases its customer base of high income earners, it will be reducing its risk portfolio. There is an opportunity for CIC to enter into new markets or segments. (Lawler and Boudreau 2006) In this case, the organisation needs to carry out extensive marketing especially in places where the market has not been exploited by the organisation. This may call for re-packaging of its products in order to appeal to new markets. It means that marketers within the organisation have to show potential clients other uses or benefits of their products. This means that the marketing team has to be ready to tell potential clients more that what they already know. (Maundy, 2001) There is still the opportunity for CIC to hire skilled labour and also retain them. Potential employees in the market are looking out for positive attributes in an organisation in order to join it. It is also quite imperative for CIC managers to know that for it to succeed it needs to exploit the opportunity of skilled labour in the market. It needs to hire the cream of the society. (Mark, 2001) The market surrounding Chester Insurance Company has so many unmet needs. This organisation needs to strategise so as to ensure that those needs are being met. These needs relate offering better services. The market wants to deal with an organisation that is trustworthy. The management therefore needs to exploit this opportunity. This could mean that the organisation can expand its product line in order to meet the customer needs in the market. The organisation has also the opportunity of carrying out vertical integration. Threats These are aspects in the external environment that hinder an organisation from achieving its goals and objectives. Threats may range from competitors in the market, an organisation that has technologically updated products among others. Research on CIC organisation shows that it is also experiencing threats from the market. This includes having price wars with its competitors. (Marchington, 2005) The organisation is also facing very stiff competition from other organisations in relation to customer attraction. Due to this stiff competition, employees in CIC have never viewed it as an organisation to stay but as a bridge to better companies. This is a threat to the Company and proper measures to deal with it in the market. (Reilly and Tony 2006) The fact that CIC does not have a big customer base of people with high income means that these target market are getting services from other competitive organisations. This is a threat in the sense that the market has organisations with better products and services for high income earners. Competitors in the market also have better distribution channels as compared to CIC. It is important to note that an organisation’s threats can be changed to be opportunities. (Anthony, 2006) Key features introduced that can help CIC increase its customer base Modernisation program has been introduced to broaden customer base and reduce differences between CIC and retail bank. Key features that will help achieve this goal are as follows; Re-deployment of workers in call centres The management in CIC decided to carry out re-deployment of workers in call centres. This means that the organisation is planning to ensure that customers who are far away from their offices get their services. Having workers in decentralised places means that they will be in a position to market the organisation’s products to more people than what is currently being done. Having workers in the interior and decentralised places means that there will be few queue of workers who want to seek information about the organisation. This will in the long run help the organisation to increase its customer base of high income earners. This is because the potential clients will not shun away from asking questions because there are long queues. This is because this target market consists of very busy people who never want to waste even a single minute. (Sparrow and Hilltop 1994) Having outlets in areas where high income earners live will definitely increase the organisation’s customer base. This as shown in the case study will close more than 100district sales and claims offices. As the organisation’s customer base increases, there will definitely be increased profits leading to overall success. Empower employees The organisation has also planned to empower employees so that they can give better services. Customer service plays a very big role in any business. It is very clear that customer loyalty is highly influenced by the kind of customer service that they get. Many organizations that are successful have realized the importance of customer service. To help improve customer service, the organisation has plans to carry out extensive training of its employees. (Anthony, 2006) Training involves a behaviour modification which is normally carried out in a formal and systematic manner. It is as a result of planned experience, instruction and education. Training and development plays a big role in achievement of organizational goals. Most of these goals are normally long term in nature. (Adler and Allison 2007) Training is part of the strategic framework of organizations. It produces a comprehensive and coherent plan that helps in developing employees and other stakeholders in organizations. When a business incorporates training and development therein, it acquires a competitive advantage over the other businesses. This is because the intellectual capital in the business is greatly developed. In fact employees in an organization get an opportunity to improve their skills in their areas of specialization. All this when effectively carried out will lead to increased number of customers. (Thomson and Rampton 2003) Change in management team The organisation also has plans of implementing changes in the management team. This will also help in increasing the customer base therein. As earlier on illustrated, the management in CIC has a very traditional way of leading. As the organisation changes management team and becomes more open to views of new managers it will increase its customer base. (Kotler, 1996) This is because the management will learn to lead by example by carrying out their role effectively and efficiently. They will be more receptive to employees’ views and implement them. This will definitely affect service delivery within the organisation and potential customers will therefore gain confidence in CIC. Within a short while, the number of customers will increase gradually. (Collett, 2005) Collaboration between employees and executive team This is also one of the strategies that have been put in place in order to increase the customer base of CIC. This is whereby there will be unity of purpose within the company. This will definitely mean that there will be better services in the company leading to increased customer base. Delays in serving customers will be minimised completely. Ideas from junior employees will be taken seriously since they are the ones who deal directly with the customers. When there is appreciation of all stakeholders in the organisation in terms of achieving objectives, then this will definitely narrow down to highly motivated workforce hence increasing the number of customers. (McNamara, 2007) Proposals that will enable CIC achieve its goals Human resource policy is quite imperative in helping organisations to solve issues related to employees or the human resource. It helps managers to use professionalism in solving conflicts or making major decisions within the organisation. There are various policies in the human resource policy. (Maundy, 2001) They include policies on equal opportunity, management of benefits, training and development management, management of records and general management policies. If CIC bases its actions on these policies, it will definitely succeed. The following proposals will enable CIC to achieve its goals of broadening its customer base and reducing differences between CIC and retail bank. They are based on the Human resource policy. (Collett, 2005) One of the policies within the HR policy. In this policy, managers in an organisation are encouraged to carry out training and development of employees. On the basis of this HR policy, CIC organisation has to focus more on employees. This is in terms of training, their welfare and motivating them. It is very important for the management in CIC to handle its employees well and even improve their working environment. This will also help them to serve the organisations customers well hence increment in overall customer base. It has to focus more on customers in relation to service delivery and tailoring customer friendly products. If the services within the Company improve, its customers will be used as tools to market its products. Management should also tailor products for high income earners. Each and every organisation should have a policy that guides it to tailor or produce quality products to customers. As CIC incorporates this policy, it is bound to succeed. (Maundy, 2001) Management style should be changed from autocratic to a blend of all styles where it is appropriate. The management style in this organisation should be changed as it has played a very big role to its deterioration. Mangers therein should use democratic, autocratic and also free will styles where appropriate. A blend of all these styles where applicable produces the best results. This is backed by the general policies of human resource management. (Maundy, 2001) Equal opportunity policy highly stipulates that all employees should be given equal chances even in aspects of appraisals. This is what is lacking in CIC. Promotions in the organisation should be on the basis of performance and skills and not length of time one has worked in the time one has taken in the organisation. If promotions and appraisals are on the basis of performance, this will greatly motivate other employees to do their best at work. Customers will then increase and the differences between CIC and retail bank will definitely reduce. (Maundy, 2001) Compensation policy stipulates that workers or employees always have to be paid their dues in accordance to the work that they perform. It is very important that management in CIC carries out benchmarking of the market in accordance to this HR policy. It is very important for the management in CIC to review its remuneration policy as compared to that of its competitors. This will help to retain existing customers and also attract potential employees in the market. It will also help reduce overall staff turnover and will be a motivator to the employees. As it implements this, it will be adhering to the HR compensation policy. (Maundy, 2001) Conclusion In conclusion, CIC just like any other organisation it has its strengths, weaknesses, opportunities and threats. Its strengths include wide customer base and being technically focused. Its major weakness is its style of management. It has an opportunity of entering new markets or segments. It has a threat of its competitors in the market. The management put in places strategies to increase customer base like change in management, re-deployment of employees among others. This organisation should not lay off workers but should on the contrary change their working environment. It needs to focus more on employees and customers than the executive team. Promotions in CIC should be carried out on the basis of performance and not how long one has worked therein. All the factors recommended above will play a very big role in increasing its customer base and also reducing the gap between it and retail bank. Read More