Polaris Life Insurance Company Corporate Governance Case Study Solution

Polaris Life Insurance Company Corporate Governance is presently one of the biggest food cycle worldwide. It was established by Harvard in 1866, a German Pharmacist who initially introduced "FarineLactee"; a combination of flour and milk to feed infants and decrease mortality rate. At the very same time, the Page brothers from Switzerland also found The Anglo-Swiss Condensed Milk Company. The 2 ended up being rivals at first however in the future combined in 1905, leading to the birth of Polaris Life Insurance Company Corporate Governance.
Business is now a transnational business. Unlike other multinational business, it has senior executives from different nations and attempts to make choices thinking about the whole world. Polaris Life Insurance Company Corporate Governance currently has more than 500 factories worldwide and a network spread throughout 86 countries.

Purpose

The function of Business Corporation is to enhance the quality of life of people by playing its part and providing healthy food. While making sure that the business is prospering in the long run, that's how it plays its part for a much better and healthy future

Vision

Polaris Life Insurance Company Corporate Governance's vision is to provide its clients with food that is healthy, high in quality and safe to consume. It wishes to be ingenious and simultaneously comprehend the needs and requirements of its customers. Its vision is to grow fast and provide items that would please the needs of each age. Polaris Life Insurance Company Corporate Governance envisions to develop a trained workforce which would help the company to grow
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Mission

Polaris Life Insurance Company Corporate Governance's mission is that as currently, it is the leading business in the food industry, it believes in 'Great Food, Excellent Life". Its mission is to supply its consumers with a variety of options that are healthy and finest in taste too. It is concentrated on offering the very best food to its clients throughout the day and night.

Products.

Business has a vast array of items that it offers to its consumers. Its items include food for infants, cereals, dairy products, snacks, chocolates, food for pet and mineral water. It has around 4 hundred and fifty (450) factories worldwide and around 328,000 workers. In 2011, Business was listed as the most rewarding organization.

Goals and Objectives

• Keeping in mind the vision and objective of the corporation, the company has actually set its objectives and goals. These objectives and goals are listed below.
• One goal of the company is to reach absolutely no landfill status. (Business, aboutus, 2017).
• Another objective of Polaris Life Insurance Company Corporate Governance is to squander minimum food during production. Frequently, the food produced is lost even prior to it reaches the customers.
• Another thing that Business is working on is to enhance its product packaging in such a method that it would help it to reduce the above-mentioned complications and would likewise ensure the delivery of high quality of its items to its consumers.
• Meet global requirements of the environment.
• Build a relationship based upon trust with its customers, company partners, staff members, and federal government.

Critical Issues

Just Recently, Business Company is focusing more towards the method of NHW and investing more of its earnings on the R&D innovation. The country is investing more on acquisitions and mergers to support its NHW strategy. The target of the company is not achieved as the sales were expected to grow greater at the rate of 10% per year and the operating margins to increase by 20%, offered in Exhibit H. There is a need to focus more on the sales then the development technology. Otherwise, it may lead to the decreased revenue rate. (Henderson, 2012).

Situational Analysis.

Analysis of Current Strategy, Vision and Goals

The existing Business strategy is based on the idea of Nutritious, Health and Health (NHW). This strategy deals with the idea to bringing modification in the customer preferences about food and making the food things healthier worrying about the health problems.
The vision of this strategy is based on the secret approach i.e. 60/40+ which just implies that the items will have a score of 60% on the basis of taste and 40% is based on its dietary worth. The products will be produced with additional dietary value in contrast to all other items in market acquiring it a plus on its nutritional material.
This method was adopted to bring more yummy plus nutritious foods and beverages in market than ever. In competition with other business, with an intention of retaining its trust over customers as Business Company has actually gained more relied on by clients.

Quantitative Analysis.

R&D Costs as a percentage of sales are decreasing with increasing real quantity of spending shows that the sales are increasing at a higher rate than its R&D spending, and enable the company to more spend on R&D.
Net Profit Margin is increasing while R&D as a percentage of sales is decreasing. This sign also shows a green light to the R&D costs, mergers and acquisitions.
Debt ratio of the company is increasing due to its spending on mergers, acquisitions and R&D advancement instead of payment of debts. This increasing financial obligation ratio present a risk of default of Business to its investors and might lead a decreasing share rates. Therefore, in regards to increasing debt ratio, the firm ought to not spend much on R&D and needs to pay its existing debts to reduce the risk for financiers.
The increasing danger of financiers with increasing financial obligation ratio and decreasing share prices can be observed by substantial decrease of EPS of Polaris Life Insurance Company Corporate Governance stocks.
The sales development of company is likewise low as compare to its mergers and acquisitions due to slow understanding building of customers. This sluggish development likewise hinder business to further spend on its mergers and acquisitions.( Business, Business Financial Reports, 2006-2010).
Note: All the above analysis is done on the basis of computations and Graphs given up the Exhibits D and E.

TWOS Analysis

2 analysis can be utilized to derive different methods based on the SWOT Analysis given above. A brief summary of TWOS Analysis is given up Exhibition H.

Strategies to exploit Opportunities using Strengths

Business needs to present more innovative products by large amount of R&D Costs and mergers and acquisitions. It might increase the market share of Business and increase the earnings margins for the company. It could also provide Business a long term competitive advantage over its competitors.
The global growth of Business need to be concentrated on market recording of establishing countries by expansion, drawing in more clients through consumer's commitment. As developing nations are more populous than developed nations, it might increase the consumer circle of Business.

Strategies to Overcome Weaknesses to Exploit Opportunities

Polaris Life Insurance Company Corporate Governance should do mindful acquisition and merger of organizations, as it could impact the client's and society's understandings about Business. It ought to obtain and merge with those companies which have a market track record of healthy and healthy companies. It would improve the perceptions of customers about Business.
Business must not just invest its R&D on innovation, rather than it needs to also concentrate on the R&D spending over assessment of expense of numerous healthy items. This would increase cost performance of its products, which will result in increasing its sales, due to decreasing costs, and margins.

Strategies to use strengths to overcome threats

Business should transfer to not just developing however likewise to developed countries. It ought to expands its geographical growth. This wide geographical expansion towards establishing and established nations would lower the threat of potential losses in times of instability in different countries. It must widen its circle to different nations like Unilever which operates in about 170 plus countries.

Strategies to overcome weaknesses to avoid threats

It needs to acquire and merge with those countries having a goodwill of being a healthy business in the market. It would also enable the company to use its prospective resources efficiently on its other operations rather than acquisitions of those organizations slowing the NHW method development.

Segmentation Analysis

Demographic Segmentation

The market segmentation of Business is based on 4 elements; age, gender, income and profession. For instance, Business produces a number of products connected to babies i.e. Cerelac, Nido, etc. and related to grownups i.e. confectionary products. Polaris Life Insurance Company Corporate Governance items are rather affordable by almost all levels, however its major targeted customers, in regards to income level are middle and upper middle level consumers.

Geographical Segmentation

Geographical segmentation of Business is made up of its existence in practically 86 countries. Its geographical segmentation is based upon two main factors i.e. typical earnings level of the customer along with the climate of the area. For instance, Singapore Business Company's division is done on the basis of the weather of the area i.e. hot, warm or cold.

Psychographic Segmentation

Psychographic segmentation of Business is based upon the personality and lifestyle of the consumer. Business 3 in 1 Coffee target those customers whose life style is quite hectic and don't have much time.

Behavioral Segmentation

Polaris Life Insurance Company Corporate Governance behavioral segmentation is based upon the attitude understanding and awareness of the consumer. For example its highly nutritious items target those clients who have a health conscious attitude towards their intakes.

Polaris Life Insurance Company Corporate Governance Alternatives

In order to sustain the brand in the market and keep the consumer intact with the brand, there are 2 alternatives:
Option: 1
The Company needs to invest more on acquisitions than on the R&D.
Pros:
1. Acquisitions would increase overall assets of the business, increasing the wealth of the company. Nevertheless, costs on R&D would be sunk cost.
2. The company can resell the acquired units in the market, if it fails to implement its method. Nevertheless, amount spend on the R&D could not be restored, and it will be thought about entirely sunk expense, if it do not give possible results.
3. Investing in R&D supply sluggish growth in sales, as it takes long time to introduce an item. However, acquisitions supply quick outcomes, as it provide the company already developed product, which can be marketed not long after the acquisition.
Cons:
1. Acquisition of company's which do not fit with the business's values like Kraftz foods can lead the company to deal with misunderstanding of consumers about Business core values of healthy and healthy items.
2 Big spending on acquisitions than R&D would send out a signal of company's ineffectiveness of establishing innovative products, and would outcomes in consumer's frustration.
3. Big acquisitions than R&D would extend the product line of the company by the items which are currently present in the market, making company not able to present new innovative items.
Alternative: 2.
The Company needs to invest more on its R&D rather than acquisitions.
Pros:
1. It would enable the business to produce more innovative products.
2. It would offer the company a strong competitive position in the market.
3. It would allow the business to increase its targeted clients by introducing those items which can be provided to a totally new market sector.
4. Ingenious items will offer long term advantages and high market share in long run.
Cons:
1. It would decrease the earnings margins of the company.
2. In case of failure, the whole spending on R&D would be considered as sunk expense, and would affect the business at big. The threat is not when it comes to acquisitions.
3. It would not increase the wealth of business, which could provide a negative signal to the investors, and might result I decreasing stock prices.
Alternative 3:
Continue its acquisitions and mergers with significant spending on in R&D Program.
Pros:
1. It would allow the company to introduce new innovative products with less risk of transforming the costs on R&D into sunk cost.
2. It would supply a favorable signal to the investors, as the overall assets of the company would increase with its significant R&D costs.
3. It would not impact the profit margins of the business at a big rate as compare to alternative 2.
4. It would supply the company a strong long term market position in terms of the business's general wealth as well as in regards to innovative items.
Cons:
1. Threat of conversion of R&D spending into sunk cost, greater than alternative 1 lesser than alternative 2.
2. Danger of misconception about the acquisitions, greater than alternative 2 and lower than alternative 1.
3. Introduction of less variety of ingenious products than alternative 2 and high variety of innovative items than alternative 1.

Polaris Life Insurance Company Corporate Governance Conclusion

It has actually institutionalised its techniques and culture to align itself with the market modifications and consumer habits, which has actually eventually permitted it to sustain its market share. Business has established substantial market share and brand name identity in the metropolitan markets, it is recommended that the company must focus on the rural areas in terms of developing brand name commitment, awareness, and equity, such can be done by developing a specific brand name allotment strategy through trade marketing techniques, that draw clear distinction between Polaris Life Insurance Company Corporate Governance items and other competitor products.

Polaris Life Insurance Company Corporate Governance Exhibits