Business Environments Considered In Strategy Formulation Commerce Essay


The principal endeavor of a business strategy is to provide superior value, differentiation, and core competencies for an organization. A business strategy is the pathway to achieve the mission, goals, and objectives of the organization. Strategy is the long term direction and defines the span of an organization and it helps the organization in its development through various arrangements and efficient aligning of resources in a challenging environment, to meet the requirements of markets and to complete stakeholder expectations. Strategy is plans for the allocation of a firms search resources, overtime to reach identified goals, environment, competition, customers. Business strategy identifies and priorities the steps to counter the challenges of the current global financial crisis and position the company for future growth.

Business Environment

The pace of global, economic, and technological development has compelled the organizations to take serious measures to remain competitive. This rapidly and constantly changing environment demands the organizations to generate equally fast responses in order to survive and prosper. High amount of uncertainty made it much more difficult to plan, as often unforeseen events change their outcomes. With small incremental changes bigger ones are also needed to produce dramatic results.

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There are evidences financial institutions that make the investment decisions for billions of Euro, like insurers, banks, asset management companies, and pension funds, are increasingly realizing that there is a considerable link between our rapidly changing environment, climate, and investment policies. Companies in the financial sector can only manage risks and contribute actively to the protection of their interests subsequently through their risk awareness and following investment policies and decisions.

In order to be capable of adapting to unpredictable environmental conditions, organizations need higher management commitment and strategic flexibility. After foreseeing and contemplating real options, they need to be accompanied with some innovative ideas and full participation of all to ensure proper execution.

Reason to change

The motive behind formulation of a business is to be more profitable and competitive. Following are the factors which compel the top management to take the decision of adapting an appropriate business strategy.

Low investment yields

Government imposed price controls

Regulatory reforms and investigative pressures

Crises in financial sector

Organization of the study

The organization of the study is Aegon. Aegon is a provider of life insurance and pensions and offers a wide range of long-term savings and investment products. Aegon is the holding company of one of the world's largest life insurance and pension companies, and a strong provider of investment products. It was formed as a result of a merger between two insurance companies AGO and Ennia in 1983. It operates in three main markets: the United States, the Netherlands and the United Kingdom. It also has expanding operations in Central & Eastern Europe, Asia and the Americas. Aegon is organized by country unit. Aegon companies employ approximately 29,000 people. Aegon's businesses serve millions of customers in over twenty markets throughout the Americas, Europe, and Asia, with major operations in the United States, the Netherlands and the United Kingdom. The Group works through brokers, agents, banks, direct marketing and online to ensure customers are able to access products and services in a way that suits them best.

1.2 Objectives of Business Strategy

The following objectives are considered by Aegon management before implementing a business strategy. It has the following short term and long term business goals which it aims to achieve through its business strategy.

Financial Perspective

The company aims to be financially strong and profitable. This could be achieved through remarkable growth in premiums, Underwriting Profitability, attracting new investors, Capital and cost efficiency, Radical investment decisions and getting good Investment Returns.

The organization aims to reallocate capital toward businesses with higher growth and return prospects, to preserve capital and accelerate the capital release program.

To improve growth and returns from existing businesses;

To manage Aegon as an international company.

Develop contingency plans for possible deterioration in financial markets.

Customer Perspective

Customer satisfaction to be increased through setting low prices than the market, differentiating the company by offering innovative products, creating relaxation and ease in terms and conditions and improving the quality of relationships between the company and the customers.

Internal Perspective

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It is concerned with the improvement of the systems and behaviors within the company. It accommodates civilizing the processes of client relationship management, enhancing underwriting process, innovation capability, and other business processes.

Learning and Growth Perspective

Learning and growth perspective talks about efficiently utilizing human resources of the company. It can be achieved through trainings, seminars, meetings, etc to improve workforce skills and knowledge in different fields. It consists of underwriting skills, marketing skills, financial skills, claims management skills, and others.

1.3 Industry Specific factors

A decade ago and in financial sector even a few years ago the impact and power of the ethics, norms, and underlying values and behaviors was not given a significant importance. They were considered intangible having no trivial part in growth and profitability of the organization. Changing norms is hard, but not impossible. Now dynamic organizations are realizing that just changing the norms can reduce the crises and tension in the sector, by re-aligning the motives of agents in the financial sector and the society.

The financial services industry needs to adapt its internal processes and policies and its products and services to meet the challenges its clients face as well as to safeguard its own viability. The emphasis needs to be given to the things that offer certainty in investment decisions and provides business opportunities for clients. In order to adapt their own operations to the new challenge, financial services companies need to include adequate planning in their internal governance procedures, in line with the existing financial corporate risk identification, controlling and reporting structures and best practice in reporting requirements. The organization need to be aware that to what extent the changes in environment will impact or enhance the value of investments and shareholder value.

For the companies dealing in asset management it is more important for their fund managers and financial analysts to develop tools to assess risks and opportunities remain limited. They need to consistently evaluate their client portfolios for environment and climate change risks and opportunities in order to be able to respond to changes in policy and legislation. Then adapting the measures to minimize risks or maximize opportunities from it. Also the clients need to be educated about the benefits and processes being used to incorporate extra financial issues in the management of their assets.

To a lesser extent, the negative outlook also reflects heightened credit risk due to positions in credit derivatives and the potential for increased earnings volatility related to financial market developments.

1.4 Strategic Analysis

The organization use strategic analysis techniques to review its strategic capabilities and uses this review information to develop its products and markets. Strategic analysis plays a critical part in evaluating the market position of the organization. It must monitor its environment persistently to achieve it long term objectives. These mostly include the following.

Build the business and constantly improve it.

To develop the strategic competencies within an organization to be able to offset threats, manage to make the most of its opportunities and move the organization forward.

Improve the ways in which it creates products and develops new and existing markets with a view to offering its customers better service.

Significance of Stakeholders Analysis


Stake holders are able to significantly influence the policy objective or success of any of the phases of the measure. Stakeholder management in industry of financial services has rapidly gained substance due to seismic changes to the sector's business environment. Effective stakeholder management can enhance corporate value drivers. Stakeholder management and the corporate strategy should be fully aligned.

These may include government agencies, employees, customers, advisors, community and other interest groups. The company shard basic information with all the concerned parties involved but the main emphasis was given to employees, policy holders, and investors. The stakeholders of Aegon are:

Government officials

Policy holders (Direct customers)

Investors (At individual and corporate levels)


Brokers (Middle parties)

Rating agencies

Alliance partners

Supervisory Authorities.

Conduct an environmental and organizational audit of a given organization

External Audit

External audit highlight the significant changes in the business environment, and the impact of those changes on the company's competitive position within the industry. The external audit of Aegon highlighted the weak spots like ambiguity in public about the company products and operations, complicated financial services, fragile presence within the marketplace, and the need to respond to the customer needs, creating consumer loyalty and identifying ways to meet future or emerging needs. It facilitated the company to take global expansions and local expertise both under consideration.

Internal Audit

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Internal assessment pointed towards the lack of strategic direction, missing competences, poor research and development. It fostered management towards improvement of values and behaviors. It helped to manage people in tune with the learning Culture. It seemed to have drawn their attention to issues like developing trust, collaboration, teamwork, quality orientation etc. It created more role clarity and gave direction to the employees in terms of their work and to align themselves with the vision of organization.

1.5.1 Strengths and weaknesses of Organization

The audits are conducted in the organization to highlight the gap between the current organizational state and desired organizational state. This gives a real picture of the scenario and helps the organizations to streamline the things accordingly.

Similarly the audit of Aegon was conducted which covered both aspects internal and external. It revealed the following strengths and weaknesses of the organization.


Aegon has a rich history of success and profitability. Aegon was considered a strong brand with in United Kingdom and locally was a known company in financial services. It was comparatively established having 27,000 employees and over 25 million customers.

It is well recognized for its outstanding and distinct retirement and pension plans.

The staff of the organization is quite proficient and creative, who could efficiently communicate the product benefits to the customers.

Aegon is the holding company of one of the world's largest life insurance groups. Its operating entities enjoy very strong, well-diversified competitive positions; strong capital adequacy and capital quality; financial flexibility; and strong risk controls for most risks. But these positive factors are partially offset by a difficult industry wide operating environment in Aegon's core markets, and its exposure to investment markets.


There is lack of strategic flexibility. The organization has failed to renew its strategies to cope up with unpredictable changes in their environment. There exists a lot of ambiguity and uncertainty in the systems and procedures.

The organization lacks the process of incremental development. There are no proper systems in place to assure that organization is learning through its past experience and strive towards excellence.

There is low level of awareness about the company profile, its operations and products among the target customers. Even if they are aware, they can not differentiate certain products of the organization.

The financial products of the company are not well recognized in areas other than pensions. The company has certain other good and above average products, but proper steps are not being taken to make the customers aware of their significance.

Aegon has been unable to properly reposition the brand within the financial industry according to the rapidly changing environment. The company is experiencing increasing levels of competition in the United States, the Netherlands, the United Kingdom and emerging markets.

There is rigidity in market strategies and actions. There is lack of proper and fruitful marketing research. The one already in place is inadequate or incorrect, which results in failure to understand the customer needs and demands for new and innovative products.

There is lack of vision on the relationships between organizational structures, Environment changes, processes, technology, and customer services. People within the organization did not seem to share a common vision.

There exists no formal system which could ensure radical decisions are taken. There is no prescribed system for identifying various alternatives for tackling a particular situation, weighing those alternatives on basis of their outcomes, and than choosing the best among them. Also a few heads use to take decisions, with no involvement or feedback of others. It is a reactive organization rather than being proactive.

The organization is unable to reflect both local knowledge and global power to its target customers. There is no clear Band Icon people can associate them with. Proper measures are not being taken to improve the good will of the company.

In spite of being well established and successful since years, the company is unable to remain as profitable as was before because of its inability to respond to the changes in the market. It is experiencing reduction in the group's flexibility to meet capital, leverage, and debt servicing ratio expectations.

It is found that its employees react too defensively where complaints are concerned, preferring to minimize their importance, or to seek to justify and excuse them.

Link between Audit and Business Strategy

Business strategy of a company guides the overall direction of the organization and specifies resource allocation and plans to achieve its goals. It involves situational analysis, formulation and implementation. Major strategic decisions are taken on behalf of data collected through different internal and external assessments.

Audit serves as base for the strategy as it not only give internal and external assessment of resources, capabilities but also point out weaker areas. Audit clearly gives a top down analysis hat from where organization need to change and how this change will result in .It produces the data needed to determine whether a change in strategy is necessary and exactly what changes should be made. It significantly identified the key factors that organization must focus on to be successful.

2. Strategy Planning of Aegon

The organization needs three different types of strategies.

2.1 Corporate Level Strategy

It is a comprehensive strategy to guide the major actions that will accomplish the organization's long term goals. The organization need to adopt concentration strategy with slight combination of growth strategy. It will help the organization to increase its market share and profitability. The organization should focus on the following things.

It is well known in the US market for it retirement and pension plans. The organization should focus on targeting new markets for these plans. A market development strategy should be pursued or these products.

The organization need to develop new and innovative products for its customers. It should focus on bringing in plans with more benefits and less premium rates. Emphasis should be given to education plans, children marriage plans, group life insurance plans, and medical plans. It can offer more variety and plan term variation in plans. The product offerings need to be more flexible, so that the customers can opt or cancel various features depending on their circumstances.

More experienced and trust worthy fund managers should be hired for major investment decisions particularly in fixed income investment portfolios.

Also the benefits and protections offered in personal life insurance products need to be carefully articulated to avoid the frequency and severity of insured loss events.

The organization can look for joint ventures and alliances of some particular products particularly in international markets. It will help the organization to overcome its weaknesses by learning from its partners and by deepening its reach into products and markets within the new scope.

After a year or so the organization can move towards the growth strategy.

2.2 Portfolio Strategy

This strategy helps the organization to compare the positions of different business units to adequately allocate the available resources. The generic competitive strategies form a business tool which helps strategists understand how the position of a company within its industry can be directly related to the strategy it employs. The strategy employed can then be analyzed to understand where a company's competitive advantage lies. The Aegon business portfolio strategy is evaluated through the use of BCG (Boston Growth Consulting Group) growth share matrix the stars and cash cows are identified.

Main types of competitive advantage strategies are cost advantage and differentiation. Since Aegon belongs to financial management and insurance industry, the strategies of cost are mainly determined by the regulatory and development authorities. So the price of the product does not play as important role as the marketing strategy and unique product features that the organizations adopts.

i. Differentiation

The generic strategy of differentiation is not applicable to the insurance industry since it's a regulated industry and the prices of each policy across the industry are more or less the same. Hence differentiating the products based on charging a higher price for the brand does not exists in the insurance industry.

ii. Cost Leadership

This is a strategy where a company aims to out-price its competitors by reducing costs. It requires a focus on the efficiency of production lines and economies of scale. Aegon will use this strategy in the form of corporate employee insurance and investment programmes. To achieve this organization will target people working with in corporate sector to offer them a lower premium than that charged in retail. Aegon will not have to encounter any additional cost as the leads will be created by the sales agents. This way the organization will be able to tap the customers who cannot afford a high premium. Hence it reduces the distribution cost as there is bulk selling.

iii. Focus

This strategy is aimed at a specific target consumer group, for example cultural, economic, political, geographical or age-related groups. The organization will be using the combination of cost and differentiation focus within its target audience. For this, Aegon will first divide the consumers on the basis of economic and social class and will than come up with the solution that attracts them along with the prices to match the segment.

For instance, it will target those consumers for whom paying a high premium is difficult but at the same time they want to secure their families. Products can than be offered on the basis on the needs of the consumer whether they want family protection or want to secure their child's future they want their funds to grow or want a steady income after retirement. Hence on these needs each product is offered making it a focus strategy.

In this perspective age coverings of the plans would be revised covering a broad range. A more obvious fund accumulation plan will be introduced with some products, so when a person is in need of money instead of taking a loan can withdraw the sum from this keeping an amount that is equal to a single premium. More specific term plans will be introduced through the person whose life is insured will get a certain amount after the term and protection.

2.3 Business level Strategy

The organization should opt the analyzer strategy adaptation model. This strategy combines the elements of the defender and prospector strategies. Using this strategy, the organization, the organization will be able to maintain a firm base of traditional products and customers while simultaneously watching its competitors and searching for new products and markets that appear to be workable. This way the organization will not only be able to earn profits but could also be flexible to respond to the changes in the external environment.

Aegon should differentiate itself by offering new and innovative products to its customers. For example the per capita income of people in Asian countries is low. The organization can offer the products with low premiums and offering the benefits more than the competitors. It can differentiate its products on the basis of product offerings, customer service, easy claim settlement procedures, low cost, variety in plan terms and other factors that could be meaningful for the customers.

2.4 Functional Level Strategy

This is the most important strategy and also most neglected in the organizations. It aims to support the execution of business level strategies. It provides the necessary coordination and integration for the business level strategy. The organization should proceed from the functional level strategy. If the people of the organization are well equipped and motivated the goals can be achieved very easily. So first of all the strategy focus needs to be internal.

3.0 Strategy Implementation

In proper implementation of the strategy the key players are consulting managers and middle managers. Proper implementation of business strategy is very critical in organizational effectiveness. A sound idea can fail if the organization does not pay careful attention to identifying desired outcomes, developing appropriate activities, and giving employees the appropriate skills to do the work.

Strategic Planning Implementation Success

The organization will be able to successfully implement its business strategy by focusing on the following factors.

Full and active executive support,

Effective communication,

Employee involvement,

Thorough constant organizational planning and competitive analysis, and

Widespread perceived need for the strategic planning.

The organization will appoint an executive champion or leader who "owns" the strategic planning implementation process and makes certain other senior managers, as well as other appropriate people in the organization, are involved.

3.1 Implementation Requirements

Before the actual execution of the said plan the following things need to be deployed.

Overcoming Resistance

Anxiety and resistance will be dealt by using psychological perspectives. Plans will be implemented through detailed action plans and supporting governance. Change will be initiated from the lowest level. This will be done first by involving the employees and other key stake holders. Culture of organization will be newly shaped by promoting internal integration and external adaptation.

The strategies will be practiced consistently to make them a part of the organization. Feed back will consistently be taken for improvement and focus will be given to the neglected or weaker ones. This way the whole process will be keep on repeating and the result is a constantly improving organization.

Resource Requirements

The necessary resources required for the execution of the strategy will be deployed. Mainly it will include availability of training material, broachers, meeting setups, Stationary and digitalized resources for report generation and motivational material development. Intense capital investment will be needed to increase profitability of its portfolios.

Financial Setting

The key long-term financial goal of the organization is to achieve a targeted profitability and a net asset level.  The activities in support of the strategic goals will be prioritized with respect to the resources that are required versus those that are available.  The prioritization will occur in the following levels.

The Executive Director and staff leadership team will prepare the budget for the coming year.  In that process they will decide which staff will be assigned to various activities, what funds will be budgeted and what goals will be established for the staff.

The units of the organization will prepare their requests for funding of initiatives that require additional resources for financial or staff time.  These requests will be reviewed by the Finance Committee as part of the annual budget process.  They will be ranked by the criteria of their contribution to advancing the strategic goals. 

Each unit and further department will prepare an annual plan of activities.  These plans will include activities that do not require additional financial or staff resources, as well as those requiring funding.  Each entity will prioritize the activities according to the enthusiasm and interest of the volunteers within the entity.  Their plans will be reviewed annually at the fall meeting of the Board and Operating Councils.  Feedback and suggestions will be provided to the entities.

 This will ensure that the organization maintains a balanced budget and allocates its scarce resources to the most important goals.  The relative rate of progress toward achievement of each strategic goal will be determined by the prioritization of activities at each of the level.  The leaders of the Institute will effectively "vote with their decisions on prioritization" as to which goals are most important to advance in a given year. 

3.2 Strategic Plan

Initialization and Involvement

First of all before implementation of business strategy its importance should be clearly communicated to its stakeholders. Than the positions including values and expectations of key stakeholders must be analysed.

Systems involved

After introducing the business strategy, workable approaches need to be formulated for engaging stakeholders. It helps in clarifying the intent and logic of consultation with key stakeholders. This approach will be practiced while keeping in mind three main objectives:

Avoid Conflict: The main purpose of involving stakeholders in the initial phase of strategy implementation is to avoid different sort of conflicts at a later stage. This will help them to understand the change perspective. Stakeholders will be engaged in the process of resolving conflicts among them through negotiation, mediation, and collaborative learning.

Develop a "Shared Vision": The goal of the organizational strategy that is "To be the best long-term savings and protection business in the UK" needs to be understood by every employee. This way the direction would be clear and stakeholders will be in better position to suggest ways to achieve. When they started thinking in this respect the need for proper implementation and execution of the strategy will become clearer and appreciate able. Various collaborative meeting sessions should be conducted to encourage stakeholders to come up with a vision or direction that they can agree to and buy into.

Formulate Creative Solutions: This way various paths all collaborative efforts hope to use dialogue and group processes to develop creative solutions that may not have emerged from traditional planning exercises.

3.3 Stages of Implementation

The overall business strategy has been divided into different stages of the project, with a project schedule and clearly marked milestones. The overall strategic plan has been split into smaller action plans. In implementation section the plan's implementation roles and responsibilities are clarified. Extra sensitivity has to be shown in first 90 days of the implementation of the plan.

The organization has to take will implement its business strategy in two aspects. Initially it will focus more on improvement of its internal systems and processes and than on external endeavors. But along with internal focus, there are few steps which it will pursue regarding its external ventures. According to my opinion the organization should start from emphasizing on its functional strategy. For that the following steps should betaken in various phases.

Phase-I: Internal processes

Steps will be taken to ensure that carefully crafted strategy is not ignored, resisted, or misinterpreted. It will allocate required resources to strategy-critical activities in a systematic way.

Customer focus

Having satisfied and loyal customers is the main aspiration of every organization. The organization should start implementation through promoting a common set of values. A culture of thinking first for the customers will be institutionalized, to foster employees to be more creative and caring towards their employees. Employees should be taught that their ultimate focus should be customer satisfaction in best possible way. This will help in thoroughly understanding customer needs and wants and coming up with the best possible financial products.

How it will be done: For this purpose, the organization will formulate a customer service charter, extending above mission statement and services offered, so as to inform staff and customers about the standards of the organization. These standards will cover quite detailed aspects of service; such as:

How many times the telephone will be permitted to ring until the caller gets an answer.

How many days between receipt and response for written correspondence.

Complaints procedure and timescales for each stage.

Claim settlement period

Policy or investment revising procedures

This charter will set customer expectations, which employees are supposed to meet. Customers get disappointed particularly when their expectations are not met. The employees will be taught to inform customers and keep them updated when problems arise. Not being told in advance, not receiving any apology, not getting any explanation why, and not hearing what's going to be done to put things right, are key areas of customer dissatisfaction. Therefore Aegon will focus its efforts on them to achieve and communicate improvements.

Plan Awareness

Awareness will be created among the employees that why this strategy is adopted and why there is a need to change. Its benefits and myths will also be addressed to avoid any resistance or misconception about the ongoing strategic implementation. Things will not be imposed on the employees so that they could positively embraced strategic change.

How it will be done: The deviation and gap between desired and actual organizational systems will be clarified. Effective communication about change implementation and likely results will automatically reduce speculation among employees. Employees will be able to recognize their role in the strategic process and its success.

Employees will be educated on financial aspects of the business, including the value of their service to customers. They will be offered financial and educational incentives for doing their jobs well. Integrity is the core quality of a successful and empowered workforce. Integrity will be encouraged at all levels. It will foster employees to honestly and consistently follow a certain set of core values and strive to excellent work on every occasion.

Encourage Excellence

Importance of encouraging excellence cannot be denied as, the awards and fellowships can significantly affect the lives and work behaviors of the employees. The company can get more excellence by rewarding more excellence.

How it will be done: It is decided that extra ordinarily performing employees' will be acknowledged. The company will offer them some performance certificates and good feed back from the seniors other than monetary rewards. Employee of the month scheme will be initiated in every department and branch to encourage out performers and boost healthy competition within organization. This will result in dramatic change in attitude and commitment of employees towards their jobs.

Decision Making

Making right decisions and sticking with them while implementing is a critical issue in the effectiveness of any organization. It enables employees to take good decisions by practical tools to respond to inappropriate or illegal behaviour. Employees should be empowered and should be given a certain amount of liberty in their work. This way the relatedness of employees towards the company goals will increase because of timely decisions.

How it will be done: The structures and policies for decision making will be aligned with the values of the organization. Middle managers are now instructed to involve employees in the decision making process and frequently get feedback from them. The trusting relationship between management, employees and constituents will present the organization a strong foundation for making and acting upon good decisions.

Positive Work Environment

A final area central to business success is good relations between management and employees. Individual accomplishment is no alternate for team effort. Strategic implementation details will be communicated regularly with the employees. The strategy emphasize that team culture will be promoted with in the organization.

How it will be done: A sound employee retention program will be introduced to motivate, educate, and train the employees. Steps will be taken to reduce stress and jealousy, hence maintaining a good working relation in the organization. It will help in achievement of goals with more dedication and commitment. The spirit of working together will enhance employees' morals to perform extra ordinarily to achieve common objectives.

Training Sessions

A culture of learning will be cultivated in the organization through training sessions. This will enable employees to look beyond problem solving towards innovation and continuous learning. This will positively increase the capacity of the organization to change. Purpose of the training will be to make employees aware of the aims of the business, its mission statement and sales propositions. It will clarify their responsibilities and performance measures.

How it will be done: the organization will conduct training seminars for the employees. Leadership development programs and modules will be provided that focus on current strategies and each person's role in implementing them. It will assist in enhancing strategic thinking throughout the organization. A consultancy firm will be contacted to train its few mangers who will further pass on the knowledge to others.

Through extensive trainings and laboratory situations, the employees will be able to take initiative to identify and anticipate problem areas in customer service. For this purpose suitable mechanisms will be established to enhance trouble-shooting capability of the organization. Employees will than be able to take responsibility to pick up problems and deal with them.

Culture Change

The main factor of success of business strategy is the culture encompassing core values and norms of the organization. It is often hard to recognize and understand the impact of culture as it entrenched in every facet of an organization. To change organizational culture, board and staff members will be made recognize the current culture, the consistency between the organization's values and its culture, and then steps will be taken to change the culture.

How it will be done: the culture will be changed by promoting the desired set o values with in organization. For this first the desired behaviors like integrity, empathy, enthusiasm, responsibility, appreciation, self discipline, business knowledge, trust, optimism, etc will be identified. Than stepwise each desired value will be opted. This value will be made visible by reading materials in offices, notice boards and meetings. Employees will be asked to mainly focus on this value. Mangers will have to exhibit those behaviors. For example to encourage others to act enthusiastically towards their work, the managers will have first have to do so.

Once the cycle of giving a week to every desired value, the cycle will be repeated the same way. It will be repeated 4-5 times till they become a part of the behaviors of the organization. This phase will act as a catalyst o the strategy implementation process.

Customer complaints

Customer complaints handling is a key element in businesses. Measuring customer complaints is crucial because individual complaints are crucial areas to resolve. They serve as indicator for the quality and performance of the business. Complaints are the opportunities to turn ordinary service into unbeatable service. It is crucial that to capture all complaints in order to:

How it will be done: The organization will launch a campaign "Feel Free to Share" to encourage customers to complain, to open the channels as wide as possible. Also a standard feedback form will be devised. It can double as a promotional tool as well if it's made available on a wider scale. The form will carry details of your mission statement, service offer and your customer service charter.

Performance Standards

To asses finance and business performance standards need to be very clear. First key performance indicators will be identified. The organization will establish systems to measure customer service and staff performance. These standards will be established for to make things more visible and measurable. The results of the performance will be published internally and externally. Strategic plan's actions will be translated into job descriptions and personnel performance reviews.

Phase-II: External changes

To ensure the achievement of long term goals of business strategy the organization first aims to focus its expansion and business strategy in US region. As its performance record here will automatically enhance its other core operating subsidiaries in The Netherlands and the U.K. the most important thing will be the right selection for portfolio investments. The organization will hire more experienced and dynamic fund mangos to take the right decisions.

Marketing Emphasis

The organization will be carrying out customer satisfaction and perceptions survey time to time. Valuable feedback is always obtained from customer survey exercises. Aegon will follow market penetration strategy by offering competitive products. To expand its distribution channels, it will focus on franchisee model, rural business, direct sales force involving group insurance and telemarketing opportunities, banc assurance and corporate alliances.

The image of the organization will be improved by marketing materials; advertising; trade shows; direct mail; market research, and public relations.

Claim Settlement Period

The existing procedures for claim settlement are very lengthy and cumbersome. The organization will simplify the process of approval and verification of claims. Documentation and unnecessary details will be reduced. Currently the settlement takes about 10-12 days. Aegon aims to reduce it to 5-7 days. The ratio of unsettled claims will be reduced by making things more evident. This way customer satisfaction and trust on the organization will increase.

Conventional Products

During the recent downturn of the economy, the organization aims to focus more on the traditional based products because the customers have become more cautious these days and have lost faith in the share market. The organization will come up with products which offer less fluctuation and could freeze the stock value when it is high so that it ensures a positive return for its customers.

Scheduling of Meetings

To ensure successful implementation of the plans and not to loose momentum the organization will focus a lot on the feed back and meetings. Documented form of phases of strategy implementation will be provided to all units. It will help staff in establishing a yearly operating plan which details what strategies will be implemented over the next year and answers questions like who will do it, how it will be done, who will support it and till what time it must be done.

Expanding Geographic Network

The organization will tend to explore opportunities for strategic alliances to accelerate its growth. Aegon has businesses and joint ventures in China, India and Japan as well as in Taiwan. It is keen to extend its reach in Asia as strong economic growth drives demand in the region for life insurance, pensions and other long-term savings and investment products. Asia's growth potential is enormous. The organization will mold its products according to the local needs.

4.0 Appropriate future strategy

There are three different types of strategies for Aegon discussed above. The purpose and the ultimate goal and outcomes of all business strategies are same. Various things need to be addressed to achieve the desired targets. But in my opinion the most important strategy is functional one. Of course the grand strategy and portfolio strategies provide the direction for the organization. But it's the functional strategy that will ensure proper execution of the other strategies. Moreover things goals seem easier and acceptable if we start from the small ones and precede step wise to the complicated ones. So in my point of view the strategic plan implementation should start from the internal levels of the organization.

4.1 Strategic Control and Evaluation

Monitoring and evaluation is to ensure that the organization is following the direction established during strategic planning.

Responsibilities for Monitoring and Evaluation

The strategic plan document has clearly specified who is responsible for the overall implementation of the plan and accomplishment of each small phase and objective. This will make easier for the organization to hold the concerned personnel and departments accountable for systems under their supervision.

This will be done by articulation of the said strategic plan initiatives with actual decisions. The middle mangers will be instructed to regularly report to the full board about the status of implementation, including progress toward each of the overall strategic goals. Consequently the middle managers will be getting regular status reports from their staff about the status toward their achieving the goals and objectives assigned to them.

Celebrating small steps

The organization will not only compel its employees to strictly follow the strategic plans but will also celebrate the achievement of minor milestones to acknowledge, reward and communicate the progress. It will give a sense of closure and fulfillment from a job well done and the next phase will become easier.

Adjusting Timelines

Constant feedback will be taken from the employees and customers. The plan is flexible enough to mold according to the circumstances. If at any stage it be felt that personnel do not have adequate resources i.e. money, equipment, facilities, training, etc) to achieve the goals or the external setup has changed so rapidly that the goals need to be revised, Aegon will do so. Timelines and project priorities could than be changed to put more focus on achieving the goals.

Learning venture

Procedures are devised to ensure learning from monitoring and evaluation process in order to improve future planning activities and also to improve future monitoring and evaluation efforts.

Frequency of Monitoring and Evaluation

The frequency of reviews depends on the nature of the organization and the environment in which it's operating. Accordingly subsidiary and branch managers and Chief executives will have to monitor implementation of the plan at least on a monthly basis. Boards of directors will notice status of implementation at least on a quarterly basis.

Reporting Results of Monitoring and Evaluation

Mangers will be bound to periodically write reports regarding implementation phase.

Status reports will be generated to describe key issues regarding monitoring and implementation. Trend regarding the progress or lack thereof toward goals will be discussed in summarized form in these reports. Also recommended actions needed by management will be mentioned.