Case Study on "Case Allstate Insurance Company"

Case Study 5 pages (1706 words) Sources: 6

[EXCERPT] . . . .

Insurance Company

When most people hear the word All State Insurance, they will often think of their famous slogan, "Your in good hand with All State." This is significant, because it shows how most people recognize the company for the different types of insurance that they are offering. However, when it comes to working at the company, the policies and procedure that they have in place are a separate matter. Where, the company will underwrite their different polices through 13,600 agencies. (Standard and Poor's, 2009) This is important, because the sales force and support staff are: the backbone of the company, in ensuring that the public image of trust is maintained at all times. To achieve this objective requires: examining the company's model for goal setting, competitive advantages, recommend a high performance reward system and discuss if employees are motivated by the Diversity Index / QLMS system. Together, these different elements will provide the greatest insights, as to how All State motivates and addresses the different needs of employees.

Discuss the model for goal setting, evaluate Allstate's goal setting process to determine whether or not Allstate has an effective goal-setting program.

The model that is used by All State is one that combines the elements of: communication, goal setting and collaboration. Under this model, the company will use the human resources department (HR) to help recruit and retain talented employees. Where, they will seek out the most talented employees in the industry and will begin discussing with them their goals / objectives, to determine if they would be a good fit for the organization. Once someone is hired, this role will become more complicated, as the HR department will monitor the employee and provide them with a variety of tools to be as successful as possible. At which point, there is regular communication between managers and employees on a regular basis. This is significant, because it shows how in the goal setting model, All State, relies heavily on their HR department to recruit and maintain a strong relationship with the individual. Where, they work with the individual and manager, to ensure that everyone has the tools they need for success. For an insurance agency / agent, this is important because it provides them with timely information, in obtaining competitive quotes with other major carriers. In the field of insurance, this is one of the keys to being able to achieving the various goals of: increasing policies in force and the overall bottom line. (Schiemann, 2009, pp. 114 -- 123)

Discuss the competitive advantage Allstate has from the development of the Diversity Index.

The Diversity Index allows All State to be able to effectively evaluate the best possible talent. This is accomplished by looking at a number of different principals the most notable would include: succession programming, development, measurement and accountability. Succession programming is when a large pool of candidates are recruited and developed, to fill a variety of different positions. Where, they can monitor various factors that could affect the careers of the company's 36,000 employees, through the management system that they are using. Development is when the employee will learn their position and then will have a plan, for achieving successes in their career. This would encompass the elements of: coaching, classroom training, mentoring and continuing education. Measurement is when you are analyzing the different employees twice a year. This is commonly called the Diversity Index, because it allows them to see the effect that various thoughts or views can have on diversity. Where, managers can understand what possible issues could affect the atmosphere of the organization. Accountability is when: 25% of the managers pay will depend, upon how they do in the Diversity Index. This gives All State an advantage, by being able to identify key talent and it places them in important positions, where they will perform well. At the same time, this prevents various prejudices and cultural attitudes, from alienating a particular group, by holding managers accountable. This increases diversity, by preventing comments that could be considered to be insensitive and by ensuring that managers will deal with situation immediately. Over the course of time, this prevents surprise issues that could come up, about how an employer was insensitive to employees, by tying the pay of managers directly to the Diversity Index. When their pay is tied to these issues, they more than likely will prevent them from becoming out of control, which helps to maintain diversity at the company. (Hillriegel, 2007, pp. 172 -- 173)

Recommend the type of high-performance reward system Allstate should use to motivate its employees to reach its diversity goals.

There are a total of four different high performance reward systems that could be used. The most notable would include: gain sharing programs, profit sharing programs, skill-based pay and flexible benefits. A gain sharing program is when you rewarding employees for reaching specific production levels, while controlling costs. Profit sharing programs are when you are rewarding the entire organization and shareholders, for the better than expected performance of the company. Skill-based pay is when you are rewarding an employee, by obtaining additional skills such as: higher education degrees and specialized certificates. Flexible benefits are designed to fit the needs of each individual. The best system to use would be flexible benefits. This is because they give you more choices in customizing a performance package, towards the needs of each individual. Over the course of time, the use of this kind of system would work effectively, at helping each employee to work according to their strengths. This is accomplished, by addressing those issues that are most important to them, in way that will improve motivation. As a result, the use of this rewards model; will cause the productivity and profitability of the company to increase dramatically, as each employee is working to the best of their ability. (Hillriegel, 2007, pp. 164 -- 167)

If you were an Allstate employee, discuss whether or not you would be motivated by the Diversity Index and QLMS. Provide a detailed explanation.

As an All State employee the Diversity Index and QLMS would serve as an effective way of being able to provide motivation. This is because of the way the system is structured, provides an effective way of surveying employees about: how the company is doing at maintaining diversity within the organization. Where, they will look at a number of different principals the most notable would include: determining that the customer is always treated fairly, examining issue of respect / dignity in the workplace, asking how often insensitive behavior occurs and if employees are free to offer different opinions. These elements are important, because they show how diversity is always being monitored in the workplace and how various employees are treated. In many ways, one could effectively argue that this constant monitoring of diversity is: preventing existing attitudes and prejudices from continually being expressed. Over the course of time, this will create a change in the organization itself, as these different attitudes are constantly embraced by the organization.

Another aspect of the Diversity Index / QLMS system is that it increases motivation, through the pay-based reward system. Under this system, the way a managers scores on the index will determine how much money they will make. This prevents managers, from saying they are for diversity, yet when such instances arise, they look the other way. The system that is being used is: way of punishing them for failing to act, towards those individuals who lack diversity, as they will feel the effects in their wallets. Once a manager can be affected financially, is when they take in interest in enforcing issues that will promote diversity. Once this takes place, it creates an effective mechanism for monitoring and enforcing diversity in the organization. This makes the culture within the organization, more open to new ideas and people. As a result, this program has way of consistently motivating employees, as they see and feel that they are being treated fairly. (Hillriegel, 2007, pp. 172 -- 173)

Clearly, All State is at the cutting edge of addressing the issue of diversity, within their organization. This is because the company takes a total approach in improving the chances that an individual will be successful, within the organization. During the hiring phase, this process begins by recruiting a large diverse group of individuals, who can fit well within in specific departments and roles at the company. Then, once an individual is working with the company, the HR department will work closely with them, by helping to promote regular communication and respect for the ideas of all employees / customers. This creates a basic foundation of promoting diversity and respecting its principals, within the company. At which point, All state will use the Diversity Index / QLMS system to maintain diversity and see if there are any possible issues that could become a problem. This is because, the Diversity Index asks employees a series of questions as to: if the… READ MORE

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