Final Business Model and Strategic Plan

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Final Business Model and Strategic Plan

BUS/475

TABLE OF CONTENTS

Title Page………………………………………………………………………………..…….1

Executive Summary………………………………………………………………………….3

Mission and Vision Statement……………………………………………………………….….4

Social Responsibility………………………………………………………………………..……4

Business Model and Strategic Plan Part I: Conceptualizing a New Product or Service Division of an Existing Business…………………………………………………………..…..4-8

Business Model and Strategic Plan Part II: SWOTT Analysis Paper8

Environmental Analysis8

External Factors………………………………………………………………..…….9-12

Internal Factors……………………………………………………………………..13-16

Economic, Legal and Regulatory Factors………………………………..………..16-17

Adapting to Change………………………………………………………….…………17

Supply Chain……………………………………………………………………………17

Opportunities based on SWOTT Analysis…………………………………………….17

Business Model Strategic Plan Part III: Balanced Scoreboard…………...…………..17-18

The Balanced Scorecard……………………………………………………………………….18

Balanced Scorecard — Learning and Growth Employee Perspectives……………..19

Balanced Scorecard — Customer Value Perspective……………………………..….19

Balanced Scorecard — Process or Internal Operations Perspective………….…….20

Balanced Scorecard — Learning and Growth Employee Perspectives……………..20

Shareholder Value or Financial Perspective………………………………………………….21

Customer Value Perspective……………………………………………………………..…….21

Process or Internal Operations Perspective……………………………………………….21-22

Learning and Growth (Employee) Perspective……………………………………………22-23

Communication Plan……………………………………………………………………………23

References…………………………………………………………………………………….…24

EXECUTIVE SUMMARY

Progressive’s No Hassel Car Repair is a company designed to provide low price insurance rates with the Name Your Price Tool. We are dedicated to being honest, adhere to ethical high standards, and provide accurate results in everything we do. Our vision is to reduce the human trauma and economic costs associated with automobile accidents. The mission statement is to meet our customer needs to the best of our ability and to recognizing our employees as assets. We are committed to train, motivate, and reward them to improve services and work processes to provide quality service. We value our customers and care about offering them good quality insurance and other amenities. Most people consider car insurance to be a rip off because of the high premiums they have to pay and then when they get in an accident they have to still pay a deductible. At Progressive we are committed to compensating our customers as much as we can. That is why we have incorporated the new division to save you much time as we can. We understand that your time is very valuable and that is why we try and provide the best service to show you that we care. Progressive’s No Hassel Car Repair will keep the community updated through advertising, social media, and events. When we gain the trust and love of the community, we can gain the amount of business required to sustain growth. We will continuously focus on innovation and making sure that we provide the most efficient and effective ways to offer our services. In this industry, commercials is the most important form of advertising because of the humor that is added which stick in consumers’ minds. The new division of Progressive is dedicated to being the company you can trust for all of your insurance needs. Utilizing this business model we will improve growth and profit opportunity for years to come. Through innovation and the help with the community, Progressive’s No Hassel Car Repair differentiate apart from other insurance companies and optimizing benefits for stakeholders.

MISSION AND VISION

Mission Statement: While Progressive is showing responsibility in the community with their newest division “No Hassel Car Repair” it will not only benefit our consumers. It will also benefit the community by creating more jobs while challenging other insurance companies to do so as well.

Vision Statement: We know that people take pride in their possessions and here at Progressive we are designed to help them get their lives back on track without the long wait times and going through numerous people to get their claims processed.

Social Responsibility

We are always looking for ways to better serve the community and our employees.

Business Model and Strategic Plan Part I: Conceptualizing a New Product or Service Division of an Existing Business

Progressive Insurance has been around for more than 70 years and was started by Joseph Lewis and Jack Green. They were both lawyers and thought that it would be a good investment to offer vehicle owners security and protection by offering them car insurance. Progressive was the first insurance company to have a drive-in claim office, introduced the first rates for low-risk drivers, and then changing the shopping experience by comparing rates online with other insurance carriers with the popular, “Name Your Price Tool.” The Progressive Insurance Companies has always lived up to its name by being one step ahead of the insurance industry and finding new affordable insurance solutions. (“Progressive”, 1995-2015).  They offer many products such as auto, homeowners, renters, motorcycle, boat, RV, classic car, commercial auto, business, and life insurance. The vision of the business was setup to develop products or services that would enrich people’s lives making it a little less stressful.

Progressive Insurance is dedicated to customers’ needs offering their help 24 hours 7 days a week online and by phone providing quotes, updating your policy, and answering any questions that you may have. The insurance industry is generally not recognized for being innovative. It’s a conservative industry and slow to change. For Progressive to remain one of the most leading insurance companies they must keep up with the evolving change to keep meeting demands of customers. By doing so they need to create innovative ideas that customers are willing to pay for. Since the global world is becoming more and more committed to putting customer needs first Progressive the third largest insurance provider is trying to be a leader in that area as well. That is why the new service division will be committed to doing just that by providing a No Hassel Car Repair Program. The program will give the customer the option to drop off their damaged vehicle and get a rental car at the facility that handles every detail until the repaired car is ready for pick up. It will also involve a car repair evaluation that test the damaged car to ensure great quality service before the car is released back to the customer. The No Hassel Car Repair Program is sort of like the Concierge Program that Progressive had initially started but has been redesigned with more innovative ideas. The new program has been put into action in 25 states and is enormously popular with customers. The Concierge program faced a dilemma when it was rolled out in California in attack from the Collision Repair Association, an auto repair trade company.

While Progressive is showing responsibility in the community and society as a whole, the new No Hassel Car Repair Program will create more jobs and challenge other companies to do the same. We are committed to succeeding. With dedicated people and well-considered strategies in hand, Progressive Insurance can confidently look ahead to meeting the challenges of the future and to sharing successfully partnerships with its clients. Progressive will continuously concentrate on areas that can be dominated due to knowledgeability. (“Progressive Insurance Bhd”, 2005-2015). Progressive’s vision is to reduce the human trauma and economic costs associated with automobile accidents. The vision that I will create with the new division is to ease the stress of customers having to go through so much while to get their car repaired. During various stages of the repair process, Progressive should always consider perspectives of the customer and maintain quality assurance that must be evaluated by top certified mechanics. The mechanics must be highly trained to provide excellent services to ensure that no car is returned for any reason.

Progressive is dedicated to governing their vision, mission, and values with key elements that works best in the real world. The vision that I have for the No Hassel Car Repair Program division is to provide customers with services designed to help get their lives back on track fast, reliable, and effectively. The mission statement is to meet the customer needs to the best of their ability, recognizing people as assets and committed to train, motivate, and reward them, diligently improve services and work processes to provide excellent quality service. Both the vision and mission are essential tools that lead up to an organizations core values. According to “Your Dictionary” (1996-2015), Core values are the fundamental beliefs or a person or an organization. They are also guiding principles that dictate behavior and action. The new service division’s strategic direction is aimed to provide funding for programs such as “No distraction Driving Program”, to cut back on the number of accidents caused by texting, surfing the web, or dialing a number. Once we implement this new program, hopefully we will continue to see the number of accidents decrease.

The guiding principles and values for Progressive No Hassel Car Repair Program will be in accordance with the company’s. We will provide our employees with opportunities and proper training skills to reach full potential, and show them they are appreciated for a job well done. This division will strive for excellence in the workplace, community, and society as a whole. In today’s world innovation of change is very crucial for survival so it is very important to anticipate future needs. Progressive is dedicated to making strides in energy conservation, going green, helping out in the community, and any other areas that protects the environment. They are also dedicated to being ethically, socially, and environmentally responsible with anyone they involved with the company to build foundation that it is operating in an ethical way. At Progressive they have guidelines used as a moral compass ensuring fairness and respect for everyone involved with the company.

The new division at Progressive “No Hassel Car Repair” will be a continuation of our commitment to show our customers that we care and value their time. Our mission is “We take the TIME so that you can relax and enjoy your TIME”. The goal here is to save our customers time by making the time from when their car is damaged to being repaired is less stressful from beginning to end. The new division will strive constantly to improve in order to meet and exceed highest expectations from our customers, agents, and shareholders. The No Hassel Car Repair Program division will have approximately 8 to 10 highly skilled employees including mechanics and claims adjusters trained to give you the best quotes on repair estimates. These employees will also go through an extensive program geared toward eco-friendliness, energy conservation, and money matters. The hours that these employees work will be flexible, suitable to all, including working after hours to get your car repaired in a timely manner. The strategic focus here is to put our customer needs as well as those in the community first to show them we are not only dedicated to our own personal well-being. The more that we can make people more aware that we care will give Progressive a good reputation.

Business Model and Strategic Plan Part II: SWOTT Analysis Paper

Strategic Plan Part 2:

SWOTT analysis is a tool that a company uses to find out where it stands in the marketplace and where it can improve. SWOTT analysis gives a full profile where a company stands today and where it can go in the future. Knowing the strengths, weaknesses, opportunities, threats, and trends could make a difference in staying ahead of its competitors. In this paper a SWOTT analysis has been conducted internally and externally to show the strengths, weaknesses, opportunities, threats, and trends that could impact the future or Progressive’s No Hassel Repair Program.

Environmental Analysis

There are many ways that could influence decision making for Progressive No Hassel Repair Program internally and externally. In order for the program to succeed they must determine proper strategies to maintain the business. Managing the strengths of your internal operations and recognizing potential opportunities and threats outside of your operations are keys to business success. (Kokemuller, 2015).  Knowing the external environmental analysis for the new division and what factors that could affect it such as laws and taxes could help with moving forward to reach goals. Internal environment is just as important because it involves the employees. Motivated employees generally produce better results.

External Factors

FactorsStrengthsWeaknessesOpportunitiesThreatsTrends
Legal and Regulatory Rules and regulations are implemented to improve strategic planningNot knowing the rules and regulations covered under the policy could cause problems when filing a claimBeing aware of rules and regulations will give you a peace of mind knowing what is covered The premiums you pay will reflect the liability exposure you select in your limitsTrends of consumers handling more of their insurance needs on their own is already evident in the early stages of the insurance-buying process
Global Car Insurance along with the ease of not having to worry about car repairs is important to all consumers Even with access of full coverage insurance not everyone has time to go through the process after filing a claimExpanding this type of program globally will create more jobs as well as building customer relationshipsThere are a lot of competitors in this industry and may be able to offer the same type of programHaving car insurance is very important to have and its factors to obtain it is growing globally
EconomicIncorporate a small amount of to implement the new division and provide good quality serviceA new concept of incorporating the No Hassel Repair Program combined with No Distraction Program. Difficulty of determining if distractions are the results of accidentsOpportunity to decrease number of accidentsEmerging Uber services could cause economic downfallRidesharing is becoming more popular for those with limited resources
TechnologicalDependable and reliable serviceNot everyone has capabilities of filing a claim over the phone or computerWith constant growth of technology UBI devices can be installed in cars to track driving Today’s technology allows third party to try and take over offering lower premiums Consumers are always searching for lower premiums
InnovationAnalyze key drivers in the market consisting of global social, technological environmental, economic, and political factorsDelays in premium receipt from claims department Understanding the problem and then come up with ideas on how to tackle the problem and lastly execute a solutionFinding ways to be competitive with industry disruptors are becoming more challengingCome up with ways to innovate culture and ways to reward consumers
SocialRising demand for more consumer’s to take advantage of “No Hassel Repair Program”Delayed response from claims rep. resulting in not being trust-worthy to consumersGet new business and Re-evaluate the future direction for insurers making their needs high priorityLack of regulatory framework and processes to constantly adapt to changeRegulations should include Principle based as opposed to rule based
EnvironmentalExcellent support from highly trained employeesLow geographical diversificationShow commitment to environmental friendly initiativesEnvironmental infractions could create media adversityConsumers place greater importance on environmental initiatives
Competitive AnalysisImmediate ResponseCompetitors comparing ratesDifferentiate from other insurance companiesCompanies in the insurance industry competing with the name your price tool in emerging marketsimproving accuracy in underwriting, and an emphasis on customer-center services and processes

Internal Factors

FactorsStrengthsWeaknessesOpportunitiesThreatsTrends
StrategyAggressive strategy provides rapid growthNot offering good driving discounts like other competitorsimplementing better savings for consumersPossibility of not being able to cater to all age groupsRemain competitive as possible
StructuresA design structure will increase the new division while emphasizing the old oneOne mistake could be a disaster for new division Proper structure allows monitoring overall progress of companyIf morale of employees are not maintained could allow them to ignore the proper structure which could then harm the companyConsumers tend to lean towards a company with a well-organized structure
Processes and systems provide annual training for employees comparison tool lack of customer serviceCreate user friendly website and appFailure to keep updated software could make competition easer for other competitors Updated process and systems tend to make job a lot easier
ResourcesProvide updated advertisementsLack of utilizing technology to provide outstanding customer serviceAutomate rapid processing of payment to speed up processNot maximizing resources to compete within the marketProduce tv commercials and other ads to relate to demographic population
GoalsDifferentiate services from competitors by reinventing the new service division Competitors finding ways to compare prices and offer lower premiums Encourage customer feedback about services received prevent new rivalries come in and dominate the marketThe trend is to be more convenient for customers
Strategic CapabilitiesDiversityRapid growth could cause new division to go overlooked if not implemented correctlyContinue to building presence in emerging marketsCustomer needs depend on demographical areasBreak away from traditional ways of underwriting policies
CultureMaintain Respect, support, and opportunity for employeesNot being very diversityProvide each and every employee with equal opportunities Culture may reject an aggressive strategyCustomers appreciate when companies show diversity
TechnologyOptimize processing of claims Must stay updated with latest technologyAutomation to cut down repair timeCompetitors may have the ability to technology quickerTechnology is changing rapidly
InnovationsBe more creative with ideas and influential Invasion of Disruptive Innovators Continue Building customer loyaltyNegative media coverage could spread on social mediaExpand globally
Intellectual PropertyOne stop services from start to finishNot providing detailed information about the new divisionMarket growth for the main division servicesMore intense competitionTo provide customers with outstanding customer service
Leadershipbuild and manage relationshipsPoor leadership customer service due inadequate training opportunity to take managing skills in new division to a new levelPoor management could result in not meeting goalsProvide great leadership skills to gain consumer interest

Economic and Legal and Regulatory Factors

In order for businesses to maintain and increase overall health in the future they must adhere to Economic and Legal and Regulatory factors. Economic factors are considerations regarding how a consumer’s disposable income and other financial resources tend to impact their buying activities. (“Business Dictionary.com”, 2015). The new division at Progressive is geared economically towards providing good quality service and working to decrease the number of accidents. The Legal and Regulatory factors includes government regulations need to operate a business such as financial reporting and tax regulations. Emerging markets in the insurance industry are able to get away with minimal regulatory changes to prices and coverage rates making the new division more ideas to implement their strategic planning and breaking out of the Red Ocean Strategy.

Adapting To Change

For any business adapting to change can be very challenging. There are many reasons for changes such as financial challenges forcing consumers to change their lifestyle to adapt to the current economy.  Consumers constantly find ways to adapt to change even if they have to drive less or either cancel insurance premiums all together.

Supply Chain

The supply chains for Progressive insurance includes human resources, marketing and sales, information and communication technology, and inbound logistics. Plans to develop and leverage core competencies and resources for the new division within the supply chain will enable data closer with stakeholders and vendors. This vision should continuously improve performance and supply chain cost reduction.

Opportunities Based on SWOTT Analysis

The greatest opportunities for Progressive No Hassel Repair Program according to the SWOTT analysis is being mindful of regulatory rules and laws and to decrease the number of accidents being reported each year. Primary competitors to Progressive Insurance includes Geico, All State, and State Farm, which all have establish a dominating presence in the insurance industry over the last several decades. Progressive insurance has the capability to deliver award winning competition with the help of their customer’s feedback.

Business Model Strategic Plan Part III: Balanced Scoreboard

This is a communication and balanced scorecard plan for Progressive Insurance and its new division they are starting up. The paper will go into detail on how the new division of Progressive Insurance Company implemented financial perspectives using a balanced scorecard as well as how the plan was communicated. It will also detail customer’s perspectives defined in balanced scorecard which are financial, customer, internal process, and learning and growth. The perspectives will define strategic objectives, measures of performance, targets, and initiatives.

The Balanced Scorecard

A method used to further analyze strategic goals of Progressive Insurance new division “No Hassel Car Repair Program” is called the balanced scoreboard. The balanced scorecard is a strategic planning and management system which takes into account non-financial aspects of corporate performance, such as customer satisfaction and business processes, to create a complete picture of how the company is likely to perform in the future. (Magloff, 2015).  It includes the four areas of financial, customer, process, and learning and growth perspectives. Everyone involved in the company from shareholders, customers, managers, and employees share their perspectives and to gain an understanding of how they are affected by strategic initiatives. Each person involved may be affected differently by the strategic initiatives depending on the relationship involved in the company. The balanced scorecard aims to organize strategic objectives based on relationships to the new division of Progressive Insurance.

    
    
    
Learning and Growth Metrics   
Learning Objective TypeTargetsMeasuresSupporting Initiatives
Employee Satisfactionfull participation from employeescustomer satisfaction is achievedemployee rewards incentive
Employee Retention or turnoverencourage innovation and creativityemployee turnover rate decreasesuse of motivational factors
Nature of organization climate or culturefocal point around vision and missionlearn from outcome and proceduresmonitoring to make sure claims are filed properly
    
    
    
Learning and Growth Metrics   
Customer Objective TypeTargetsMeasuresSupporting Initiatives
Customer retention or turnoverthe retention of customers should be increased20% of new customers over the next five yearscontinue offering lower rates
Customer satisfactionlower wait timesmaintain 100% customer satisfactionsurveys to see what they prefer
Customer valueprompt serviceincreased good reputationrewards program
    
    
    
Learning and Growth Metrics   
Internal Objective TypeTargets MeasuresSupporting Initiatives
Measure of process performancefaster servicesexpected 15% in claim process time over the next 5 yearsproductivity measurement scale
Productivity improvementallows customers to file claims faster with mobile app75% of services provided on mobile phonesthe preference of mobile capability with a survey
Impact of change on the organizationshortened cycle timescost efficienthighly trained representatives ready to quickly process claims
    
    
    
Learning and Growth Metrics   
Learning Objective TypeTargetsMeasuresSupporting Initiatives
Employee Satisfactionfull participation from employeescustomer satisfaction is achievedemployee rewards incentive
Employee Retention or turnoverencourage innovation and creativityemployee turnover rate decreasesuse of motivational factors
Nature of organization climate or culturefocal point around vision and missionlearn from outcome and proceduresmonitoring to make sure claims are filed properly

Shareholder Value or Financial Perspective

Longevity of a company is determined by the capability of how management maintains shareholder value. It is important for a company to consider income before taxation to generate shareholder value. The company is also responsible for seeking customer satisfaction, increasing net revenue, and finding ways to achieve and maintain an overall financial perspective. To evaluate financial stability of a company, one should consider factoring in is operating cost, market share, competitive position in the market, growth revenue, and profitability. The objectives of Progressive new division should be implemented as a daily routine to increase the performance of the company as a whole.

Customer Value Perspective

Progressive value customers because they are who keeps us in business and getting their perspectives are very important. Therefore getting feedback from them helps with increase in the market share and allows to provide updated services they love. The new division will implement new strategies to maintain customer retention without the need of raising rates. It will actually reward customers who goes a period of time without having an accident. In the event if an accident does happen the new division is designed to service customers’ needs from start to finish. After all creating value for customers helps sells products and services, while also creating value for shareholders. To generate awareness in the public the new division of Progressive must organize surveys to get an idea of services that benefits the customers the most.

Process or Internal Operations Perspective

Strategic planning is very effective to giving customers a sense of knowing that their needs are a priority and should be done in accordance to satisfy them. To improve the business efficiencies and overall market value one should have effective strategies along with processes that has been implement in the new division. The process perspectives also allows customers to file a claim and check the status from their mobile devices. The No Hassel Car Repair Program has been organized by highly trained employees who are dedicated to getting the job done effectively and efficiently. To define purpose and intention why the strategy will lead the new division towards its goals we also have incorporated “No Distraction Driving”. It is aimed to reward customers who have not had an accident caused by distractions for a period of time. The employees will also be rewarded for providing outstanding customer service and working diligently to make sure claims are processed in a timely manner using a productivity measurement scale. Both of the rewards will be monitored in the system as part of operations metrics to measure sustainability.  The impact of these changes have many benefits. The customers get faster service when filing a claim with less hassle and shortened cycle time reduces Progressive’s cost dramatically. The cost of storing a damaged vehicle or renting a replacement car for one day around $28 is roughly equal to the expected underwriting profit on a six-month policy. (Hammer, 2004)

Learning and Growth (Employee) Perspective

Learning and growth process is considered the most important aspect in the Balance Scorecard, because it focuses on growth and prosperity of the company as well as employee training and corporate cultural attitudes related to individuals and corporate self-improvement. Learning in observance with the Progressive’s new division means to learn about different attitudes of the internal employees and external customers. The growth perspective in observance to the new division will focus around the mission and vision statement. What innovation is needed to go above ratio and still provide customers with lower rates?

For Progressive’s No Hassel Car Repair, the strategic objective will bring valuable improvements in the company. These improvements will be implemented with annual training skills for employees, boosting employee morale, expanding advertising sources, and earning customer loyalty. The level of organization will meet the needs to develop strategies to maintain the combined ratio of expenses plus claims payouts divided by premiums to stay in good financial standing.

Communication Plan

Purpose: To provide customers with services designed to help get their lives back on track fast, reliable, and effectively.

Audience: All our dedicated customers and to employees to show that their hard work is appreciated.

The communication used would be face to face at first to give them a chance to ask any question that they may have about the plan. Then an email would follow the meeting with details that were discussed and a detail of the plan and date the plan is set to take place. Lastly, we would send newsletters out to our current customers and advertising.

References

Business Dictionary.com. (2015). Retrieved from http://www.businessdictionary.com/definition/economic-factor.html

Hammer, M. (2004). Harvard Business Review. Retrieved from https://hbr.org/2004/04/deep-change-how-operational-innovation-can-transform-your-company

Kokemuller, N. (2015). What Are Internal & External Environmental Factors That Affect Business?. Retrieved from http://smallbusiness.chron.com/internal-external-environmental-factors-affect-business-69474.html

Magloff, L. (2015). Chron. Retrieved from http://smallbusiness.chron.com/definition-balanced-scorecard-4838.html

Progressive. (1995-2015). Retrieved from http://www.progressive.com/experience/home-1/

Your Dictionary. (1996-2015). Retrieved from http://examples.yourdictionary.com/examples-of-core-values.html

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