National Institute Of Retail Management MARKS: 80 SUB: INTERNATIONAL BUSINESS N.B.

: 1) Attempt all Cases 2 All questions Carries equal marks. CASE 1 Creating world class quality standards Introduction Customers expect to be able to buy products that meet certain standards. Standards can be written down and published for use by manufacturers and service providers. They can be used as guidance. BSI stands for British Standards Institution. It was the worlds first Standards body, and is the National Standards Body for the UK. BSI works in three main fields: . Setting British and international standards . Product testing . Quality management systems (QMS) Standards are based on agreed best practice. Businesses are keen to use standards to show they have a place in global markets. There are thousands of standards covering all manner of goods and services. Quality A quality product or service does what the customer wants it to do. This may differ from market to market. For instance, a cheap football provides enough `quality for a village match. For a league match, a better ball would be needed. Many organizations try to build quality into everything they do. They do this by using a QMS. This provides a framework that helps the business to improve in all areas. BSI helps organizations to identify best practice and translates this into standards. BSI publishes almost 20,000 standards and each year adds 2,000 new or revised standards to this list. The importance of standards Standards exist at a number of levels. These include: * International Standards, (ISO). These need to be agreed between countries, so are the most complex * European Standards (EN) * British Standards (BS). BSI contributes to all three. . COURSE: MBA

Standards help protect consumers safety. They also promote research. They promote the sharing of knowledge. They help businesses to compete. In markets where it is hard to compete on price, businesses can use standards to help them compete on quality. The Kitemark BSI is independent. It works with both the private and public sector. It makes sure that safety and quality standards in the UK and around the world are built into products. BSI also owns the famous Kitemark symbol which you see on many products. It shows that a business has had a product tested to the relevant standard. Schemes cover various products and services. Examples include lighting, 13 amp plugs, motor cycle helmets and car repair garages. The Kitemark shows that the business sees safety and quality as vital. It shows the customer that the product or service has been tested and has reached the relevant Standard. Other symbols are required by law, for instance, CE marking. This shows that a product conforms to certain European Union regulations. Processes ISO 9001 is a key international standard. It shows that the business uses a QMS. It shows that quality is built into all aspects of operations. This must include all systems, whether inside or outside of the business. It therefore includes suppliers. There are eight quality measures that must be met to gain certification to ISO 9001. Conclusion Products include both goods and services. These can be made, operated and sold on a global basis. International standards for them are therefore vita. BSI helps to create these standards. Standards help businesses to build good reputations based on quality, safety and reliability. Issues for Discussion 1. What do you understand by the term `quality in relation to a product you buy? Answer: I understand the term it as attributes to suit the buyer to an extent which is either measurable or comparable of products bought. This attribute is known as quality. So when you buy a product, it has to satisfy your requirement by cent percentage or to a lesser degree. This scale of measurement is quality. Quality is a measure of excellence or state of being free from defects, deficiency & significant variations. It often focuses on world class standards, products & service design. Quality is measured by the degree of conformance to predetermined specifications and standards, and deviations from these standards can lead to poor quality and low reliability. To consumers, a high-quality product is one that well satisfies their preferences and expectations (A quality product or service does what the customer wants it to do). This consideration can include a number of characteristics, some of which contribute little or nothing to the functionality of the product but are significant in providing customer satisfaction. A third view relating to quality is to consider the product itself as a system and to incorporate those characteristics that pertain

directly to the operation and functionality of the product. TQM is a process that underlines three principles: customer satisfaction, employee involvement, and continuous improvement in quality. It often focuses on benchmarking world-class standards, product and service design and purchasing. TQM is a process of continuous improvement at every level of the organization- the centre of the entire process is customer satisfaction. 2. What is the BSI Kitemark? How might this help you to choose a product to purchase? Answer The BSI Kitemark is a registered certification mark owned and operated by BSI. Exclusive to BSI, Kitemark is a voluntary certification mark that shows a product or service meets the applicable and appropriate British, European, International other recognised standard for quality, safety, performance and trust. Combined with the independent backing of BSI and with UKAS accreditation benefits for manufacturers and businesses include risk reduction, increased customer satisfaction, access to new customers around the world and associated brand benefits of having a BSI Kitemark status. The BSI Kitemark provides an independent third party endorsement that a service consistently meets high quality standards. Having a BSI Kitemark associated with a product or service confirms that it conforms to a particular standard. Knowing that a product has BSI Kitemark will help me in choosing it because the Kitemark has for very many years been considered Great Britains premier symbol of product or service quality that brings real and tangible benefits. Kitemark stands for quality, safety and trust so if a product carries a Kitemark customers will know that it has been independently tested on a regular basis and that it will perform to that consistent quality every time. Each BSI Kitemark scheme involves an initial assessment of conformity to the relevant standard and an assessment of the quality management system operated by the supplier. Thus a BSI Kitemark product provides peace of mind, makes selection of products easier and provides reassurance of quality, safety and security

3. How might meeting the Standard ISO 9001 help a business to gain a competitive advantage over a rival? Answer As good business practices are needed to keep current customers and attract new customers, an ISO 9001 certification shows customers you care about the quality you deliver. It shows you have strong accountability and traceability procedures in place. There are vast internal improvements such as reducing cost, mistakes, re-work and it puts in place a management system to cope with an expanding business. Also, being

the most widely used and recognized quality management system it has become a powerful marketing tool. Benefits of meeting standards Businesses therefore benefit from working with BSI to meet standards, because: standards protect consumers' fundamental right to safety, the right to be informed and the right to choose. These rights relate to products, services, processes and materials. standardisation promotes effective research and development, and makes products easier to use. standardisation relies on all sections of society being involved in standards. This provides an opportunity for everyone to share knowledge and make their voice heard. Competitive advantage: A focus on quality also delivers competitive advantage. Many businesses cannot compete by lowering prices because their market, for example, clothes or food, is very competitive. Therefore, they compete on quality. This means they deliver quality products at the right time to fit their customers' needs. Companies that focus on quality can compete against rivals who have lower cost bases. Gain a competitive edge with ISO certification: Market Access - break into new markets Market Development Speed to Market Risk management Product differentiation Managed Compliance - BSI offer guidance throughout design & manufacturing process Competitive Edge Customer Confidence - with BSIs globally trusted independence & reputation Reputation and respect certification and assurance provided by a respected, independent, third-party, Notified Body that a product or service conforms to the requirements of the Directive.

4. Assume that you have developed a new manufacturing process how might the BSI help you to develop this process? Answer By becoming a BSI licensee, you are demonstrating your commitment to delivering consistent quality to your customers and your business. The renowned integrity and quality of the BSI means that the process rigorous.

In addition, each BSI Kitemark Licensee is subject to a programme of ongoing surveillance. This includes routine testing of the product or service, assessment of production quality controls and, where appropriate, mystery shopping. These result in developing products with:

Reduced risk - Kitemark demonstrates and supports due diligence and duty of care to your industry, employees, suppliers and customers Improved efficiency - through reducing costs and waste you should be able to realise a more healthy profit in your business Customer satisfaction - happy, confident customers will bring unrivalled benefits to your business through repeat business and recommendation Access to new business - with public and private sector procurement managers increasingly specifying Kitemark, you can secure your access to these tenders and projects Reputation - Kitemark is a Business Superbrand in its own right and has established the finest reputation in its field. It offers manufacturers significant emotional and/or tangible advantages over its competitors, which customers want and recognise.

Thus, with BSI certification, the products thus developed and marked have following advantages: Helps you stand out from your competitors Provides a vita commercial edge Shows your customers that you deliver quality, safe products or services Gives you access to tender for larger projects Provides specifiers and purchasing professionals with peace of mind that they have insisted on the best products for their projects You have been independently audited or tested to ensure that you consistently deliver such quality, safe, reliable products or services Your customers have reassurance in your product's performance or service quality Kitemark certification can be used as proof of due diligence Applying Kitemark standards can help you reduce risk Kitemark certification can help increase sales by generating new and repeat business Case 2 Sustainable business at Corus Introduction Corus is the UK's biggest steel manufacturer. Even so, it still has to compete. In 2004 it launched a programme to make itself more efficient. Part of the program, called 'Restoring Success', focuses on recycling steel. The world economy is growing. The demand for steel has increased as more nations such as India and China have grown.

Recycling as part of sustainable development has thus become vital. It has become a main concern for Corus. What is sustainable? Sustainable development is linked to resources. It means leaving at least as much for the future as we had to start with. This shows respect for the environment. It also shows thought the future. Everyone should try to aim for sustainability. This includes governments, businesses and people. Recycling Steel can be recycled over and over again with no loss of quality. This makes it stand out in terms of sustainability. It is easy to extract steel from waste because of its unique magnetic properties and recycle it from scrap. By recycling steel Corus helps to: * preserve natural resources * protect the environment * meet targets for reducing waste. Corus is working hard to make the public aware of what can and should be recycled. Steel can be recycled from drink and food cans, lids, paint cans and aerosols. Not everyone knows what can be recycled. For instance, 57% of consumers recycle drinks cans but only 7% recycle aerosols. Corus is working to develop a 'closed loop' for steel. The steel would go from consumers to recycling plants, then into production and back to consumers. Stakeholders Corus sees that there are two sides to recycling. There are gains, but there can also be extra costs. To keep all of its stakeholders happy, it must balance these. There are effects on the planet. Fewer resources are used but energy is needed to recycle * consumers. They have a smaller carbon footprint but more time is needed to recycle * employees. More are involved in recycling *communities. Less waste is stored in landfill but there may be noise from recycling plants. Gains include lower production costs, governments hitting recycling targets and all of us having a better planet to live on. Costs and benefits It is possible to weigh up costs and benefits. A monetary value can be put on them. Businesses want gains to outweigh costs. Corus gains from recycling. Socially Corus gains a good reputation. There is reduced impact on the environment, lower energy use and less waste. There are also costs. These include the cost of recycling and of collecting and sorting waste steel. Corus has created a number of targets to help measure its success. These are called Key Performance Indicators. They include Corus UK energy use being reduced to less than 1997 levels an increase in the steel recycling rate to 55%. Conclusion Corus works to recycle as much as it can. This helps towards greater sustainability. It shows concern for all its stakeholders. Consumers can also help by recycling as much as they can. Issues for Discussion

1. What is sustainability and whose responsibility is it? Answer The concept of sustainability centers on a balance of society, economy and environment for current and future health. Sustainability is the intersection of people, planet and profit, commonly referred to as the three-legged stool. Respect for environment, living beings and concern for future and present can be shown as:

Sustainability is everyones responsibility. In order to achieve sustainable development, environmental protection shall constitute an integral part of the development process and cannot be considered in isolation from it. Individuals must act in a sustainable way. We should aim to reduce our carbon footprint and support the environment, for example, by not wasting energy or making unnecessary journeys or wasting water or other resources. Governments must work together to set targets and limits on environmental pollution. States shall cooperate in a spirit of global partnership to conserve, protect and restore the health and integrity of the Earth's ecosystem. In view of the different contributions to global environmental degradation, States have common but differentiated responsibilities. The developed countries acknowledge the responsibility that they bear in the international pursuit of sustainable development in view of the pressures their societies place on the global environment and of the technologies and financial resources they command. Businesses such as Corus must behave in a sustainable way. For the business enterprise, sustainable development means adopting business strategies and activities that meet the needs of the enterprise and its stakeholders today while protecting,

sustaining and enhancing the human and natural resources that will be needed in the future. 2. Describe three actions that an individual can take to support sustainability and two actions that a business can take? Answer Individual can do many things for more sustainable development, for example; by reducing consumption of over-packaged products and plastics (particularly polythenes); by walking, bicycling or using public transit instead of your car/ by choosing a more energy-efficient automobile and by buying products that are certified fair-trade. Not only would this help create the conditions necessary to preserve the environment, they would contribute to social equity through a better distribution of wealth and by helping to reduce human exploitation Business can support sustainability by recycling the waste produced during and after production and maintaining a healthy carbon footprint by not releasing toxins and other pollutants in the atmosphere. As part of its corporate social responsibility, a business can enter in social or environmental causes and make the earth a healthier place. For example Corus has a recycling policy that helps all the stakeholders:

3. Steel lends itself to recycling. What actions could be taken to increase public awareness of steel recycling? Answer Steel can be recycled from drink and food cans, lids, paint cans and aerosols. Since not everyone knows what can be recycled, it would be worthwhile to initiate an awareness campaign at one hand about the items that could be recycled and start a closed loop recycling drive wherein the steel would go from consumers to recycling plants, then into production and back to consumers. Actions that could be taken to increase public awareness of steel recycling include: 1. Recycle Now Campaign or any such campaigns highlighting the importance of waste segregation and recycling 2. Awareness by highlighting some environmental benefits of Steel Recycling: Energy saved using recycled material versus virgin ore 74% for iron and steel scrap Recycling 1 Tonne of steel saves 1.2 tonnes of Iron Ore 0.7 tonnes of Coal 0.5 tonnes of Limestone Reduction in CO2 emissions by using scrap 58% for iron and steel scrap

3. Introduce kerbside collection schemes to make recycling easier. These have increased recycling rates. Kerbside collection of recyclable resources is aimed to recover purer waste streams with higher market value than by other collection methods. If the household incorrectly separates the recyclable elements, the load may have to be put to landfill if it is deemed to be contaminated. Kerbside collection and household recycling schemes are also being used as tools by local authorities to increase the public's awareness of their waste production. Kerbside collection is commonly considered to be completely environmentally friendly. 4. Introduce recycling as chapters in school curricula and have exhibitions on advantages of recycling o educate the masses 5. Recommend actions that individuals and businesses can take to enhance the closed loop 'steel to steel' recycling process. Answer Corus wants to make the public aware how steel packaging can be re-used through a closed loop steel to steel recycling process. Consumers play a key part in this continuous loop process. If they recycle the steel products they buy in the first part of the loop, these enter the production chain in the second part. So the steel travels from

the consumer, to the recycling box, then to the recycling facility. The steel is then transformed at the steel reprocessor and shipped back to manufacturers ready for reuse as new products. This creates a continual cycle of steel re-use which can happen many times. The cycle shows 4 main stakeholders as Consumers, Manufacturers of steel products, Supermarkets selling steel packaging to us and acting as recycling banks and Local authorities who provide local recycling facilities.

Individuals and businesses can enhance the closed loop steel to steel recycling process by being aware of what all could be recycled as shown below:

Once we know what can be recycled we could use following strategies: 1. Ask hypermarkets to have a Recycle bin acting as bank for recyclable steel products 2. Ask local authorities and municipalities to have a kerbside collection for recyclable steel products 3. Advocate and lobby for having a separate dumping yard for recyclable metal products 4. Ask steel manufacturers to get involved in wider industry and international steel groups such as the International Iron and Steel Institute (IISI). This group promotes sustainable steel manufacturing on a global scale and supports recycling initiatives. On the IISI website an interesting film clip, 'Steel and You' demonstrates the various ways in which steel plays a part in our lives, as well as the importance of recycling and responsible steel manufacture.

5. Government and supermarkets are working together to create the recycling facilities but we as consumers play a vital role in the steel cycle. The steel packaging we put in can banks or kerbside recycling boxes are recycled over and over again without any loss of quality. If we behave in a responsible way with this, we can make an important contribution to sustainability. 5. Recommend ways in which the benefits of steel recycling can be increased compared to the costs of recycling steel. Answer A benefit is anything that has a positive impact. It can be internal to the business or affect individuals and groups outside the business. A cost is anything that has a negative impact. It can be either internal or external. When examining benefits and costs, it is standard practice to try to measure them. The usual way to do this is to attach a monetary value to the costs and benefits. Businesses carry out decisions when the benefits outweigh the costs. By continually monitoring its performance, a Steel manufacturing company could reduce costs and deliver benefits to stakeholders and enjoy both social and financial benefits from recycling. A cost-benefit analysis has also shown that the benefits of recycling are much greater than the costs.

Benefits include the reasons cited below besides sustainable development: Recycling Is Less Expensive The EPA estimates that the steel industry recovered and recycled more than 14 million tons of shredded steel scrap just from autos. This is an auto recycling rate of 95 percent, according to the Steel Recycling Institute. Steel is crushed and formed into bales, then shipped to steel mills or foundries where it is melted in a furnace to be made into new steel. Recycling steel is much less costly than mining and processing virgin ore. Steel Can Be Recycled Many Times Steel produced in an electric arc furnace, or EAF process, consists of 100 percent recovered steel, according to the EPA. The alternative steel producing process, combining molten iron from blast furnaces with pure oxygen injections, known as BOF, uses 25 percent recovered steel.

Reduced Manufacturing Costs It is estimated that more than 90 percent of the food can market utilizes steel cans and containers. These containers are made of up to 30 percent recycled steel. Household appliances including refrigerators, washers and dryers consist of up to 65 percent steel, and contain a minimum of 25 percent recycled steel. Steel and iron components make up about 65 percent of the average vehicle, and at least 25 percent recycled steel is used, with a higher percentage found in engine blocks. Reduced Construction Costs Steel is a principal building material in commercial construction and has gained popularity for residential construction. The EPA estimates that 25 percent of homes have been totally or partially framed with steel. As a result, reduced production costs from recycled steel are passed on to businesses and consumers. Energy Savings and Reduction of Greenhouse Gas Emissions Recycling steel saves 75 percent of the energy that would be used to manufacture steel from raw materials, reducing greenhouse gas emissions given off during processing. Saves Natural Resources One ton of recycled steel saves 1,400 lbs. of coal, 2,500 lbs. of iron ore and 120 lbs. of limestone. Additionally, a decreased need to mine ore and coal conserves enough energy for 18 million homes for one year. Steel from six recycled cars is sufficient to frame a 2,000-square-foot house, while wood framing requires at least 40 trees. Decreased Land and Water Pollution Recycling steel saves landfill space; as a result, the potential is decreased for contamination from toxic substances which pollute the water table through runoff or absorption. Income Earned for Scrap Metal and Cans The food and beverage industry projects a need for 300 billion containers by 2013. Recycling scrap metal, whether cans collected by children, junk cars or appliances, generates income for business and consume

Case 3 International trade For centuries Britain has been a country that relies on international trade. We purchase goods and services from other countries and in return we sell them goods and services produced here. An import is a purchase by UK citizens from overseas. An export is a sale by UK citizens to a member of another country. Visible and invisible trade items For the purpose of classification we call the tangible goods that we trade visible items. We call the services that we trade invisible items. Exports bring currency into the UK whereas imports lead to an outflows of currency.

The UK has always done well on her invisible account. This is because we developed a world-wide reputation for commercial services. Some of our major invisible earnings come from the following: * Selling insurance policies through Lloyd's. * Bank services to foreigners, * Tourists spending money in the UK. On the news every month we hear that the UK has made a surplus on invisible trade showing that we have sold more invisible services than we have bought. The accounts for a particular month might show: * Invisible exports ?100 billion * Invisible imports ?80 billion * Invisible surplus f20 billion At the same time the UK frequently makes a loss on her visible trade. A typical current account showing the UK's trading with the rest of the world in a given period, may therefore look like the following: Visible exports 500 Invisible exports 400 Total exports 900 Visible imports 650 Invisible imports 200 Total imports 850 Visible balance -150 Invisible balance 200 Current balance 50 The current account of the UK balance of payments gives a good guide to current trading in visible and invisibles with the rest of the world. Issues for Discussion 1. Analyze the case at length Answer This case deals with balance of payments in UK. The Balance of Payments is part of the national accounts which records payments to, and receipts from the rest of the world. Exports bring currency into the UK whereas imports lead to an outflow of currency. In this case, the visible imports/exports which include trade in tangible goods and invisible imports/exports which include trade in services, investments and transfers often intangible are dealt with. If exports are greater than imports i.e. inflows of funds are greater than outflows of funds then there is a Balance of Payments surplus on current account. If imports are greater than exports i.e. outflows of funds are greater than inflows of funds then there is a Balance of Payments deficit on current account. In the accounts, outflows of foreign currency are denoted with a minus sign. The case discusses on how UK has done better on invisible trade and not fared as well in visible trade. However having a better trading in invisible exports has buffered the UK economy to a certain extent.

Case 4 Embracing and pursuing change Introduction AEGON UK is part of one of the world's largest pension and insurance groups. The AEGON Group has over 27,000 employees. It has over 25 million customers worldwide. In the UK it has grown its customer base. It has also bought other businesses. Its aim is to become 'the best long-term savings and protection business within the UK'. To achieve this, it is keen to change in order to improve. AEGON also needed to raise its profile in the UK. The companies which it bought, such as Scottish Equitable, tended to keep their own brand image. AEGON therefore needed to build on the global strength of the Group. External factors External factors are those outside the control of the business. It is vital for businesses to be aware of these changes. Changes that have affected AEGON include: * People are living longer so need better pensions * The insurance industry has had a poor reputation. In some cases the wrong products for people's needs were sold. This is called miss-selling. As a result, the Financial Services Authority (FSA) made regulation tighter. * Financial products can be hard for people to grasp * Investment returns have been less than predicted. Many people have therefore not ended up with the sums that they had hoped for * There is a lot of competition in the industry. Why change? Government imposed price controls reduced profitability. Also AEGON was not a wellknown brand. It needed to be better known before consumers would see it as a good place for long-term investment. AEGON went through a 'discovery' phase. This was to find out what it needed to do to reach its aim. It set out to find out: what the brand stood for in the UK what they wanted it to stand for how they were going to reach this. A brand audit was used. This looked at AEGON both from within and outside. This information could then be used to plan change. Creating a culture The culture of an organization refers to the way that it works. AEGON created a culture of change. AEGON needed to do well financially. This was linked to raising awareness of the brand and building on AEGON's global strength. This meant: * financial services in simpler forms that customers could grasp * a workforce improved through training and development. This would b , better able to manage change * a more distinct market presence. AEGON developed a framework to help all its staff support its brand values. Implementing change AEGON used a number of methods to achieve the * external promotional campaigns * the new Chief Executive (C1 O) talked to the media about the need for change

* new and innovative products were launched, AEGON's success can be seen through the record results, increased new business and growth in earnings. Conclusion AEGON recognized a need to give itself a greater market presence. The change has made the organization much more customer focused. As a result it is more effective. Issues for discussion 1. What are the external factors influencing the change. Discuss Answer In general, external factors consist of all the entities of the environment that interacts with the organization. The common external factors that influence the organization are discussed below. Competition: It comprises of the related industries with similar products or services, their geographic locations and markets. It is important to know all the competitors, their organizational size and skills pool, their competitive advantages, their marketing strategies, offshore development etc. Global context: Due to increasingly broad world economy, it is important to watch the competition across the oceans, competitive products launched from abroad, changing socio-political situations, and home grown entrepreneurs. Customers: They are the end-users of the product and services, the most critical aspect of the environment. Preference changes: Customers likes and dislikes changes rapidly, people live in a tight social system that create and encourage trends. It is important to anticipate changes in users product requirements, emerging technologies that can change how the products are used etc. Demographical changes: These include the social, economical and cultural changes like population age, ethnicity, education level and economic class. Such changes affect the customer preference and the mass market trends. Resources: An organization depends upon availability of certain external resources for its operations and productivity. Skilled Workers: The availability of adequately skilled employees at various levels in the organization can change dramatically over the period of time. Once the demand for certain skill drops, so does the supply, in a long run it adversely affect the organization since it becomes hard to obtain highly skilled new workers. Similarly, as the competition grows, they compete for the same skill set in the market creating a high temporary demand. Raw Materials: Every organization uses certain raw materials to manufacture its product or service, any disruption in its supply, changes in cost of materials etc can have an adverse effect. The raw material definition includes sub parts that are contracted to be manufactured by others, projects that are send overseas for production, the leased space the organization uses or the transportation of its goods. Finance: It provides operational support; it includes savings or available cash, credit lines to fund new ventures, venture capitals, the stock markets and investors. Technology: It includes the science and technology required for the production, the

technical tools that are used in the manufacturing or the technology of the product itself in case of high-tech industry. Laws and Regulations: All organizations have to abide by the legal system, new laws and regulations are constantly added due to the political or social changes. Compliance can result in additional cost, developing new technology, additional taxes or legal fees.

2. Identify the reasons for change Answer External factors influencing the changes in AEGON are as cited below: Demand for better pensions from the older generation due to longer longevity Poor reputation of the Insurance industry and tighter regulations from the Financial Services Authority (FSA) People find Financial products difficult to understand and decide on Uncertain return of investments Lack of brand awareness for AEGON amongst the public Competition in the industry Government imposed price controls reduced profitability. As AEGON traded under a number of brand names it was not always easy for financial advisers and consumers to recognise the breadth and depth of the company in the UK. AEGON was not a well-known brand. It needed to create a better brand awareness amongst consumers who would then see it as a good place for longterm investment. 3. Creating a new culture is a key part of the change process

Answer Culture refers to the personality and attitude of an organisation. It also includes the shared beliefs, values and behaviour of the employees. These determine the ways in which the organisation and its people make decisions and solve problems. It was important to create more clarity about who AEGON was. With limited awareness of AEGON in the UK, it was important to explain what it had to offer, how big the organisation was within the UK and how strong it was globally. At the heart of this strategy was the need to: a) Simplify financial services and provide more customer focus. It was important that consumers understood more precisely what they were buying, as well as the benefits and services they received b) Develop the workforce. The objective was to develop the skills needed within the business to help it change. AEGON also created opportunities for progression from one job to another in a way that provided individuals with a coherent career path. c) Create a more distinct presence within the marketplace. This involved refreshing the AEGON brand in a way that made it more distinctive from its competitors and more attractive to customers. AEGON developed a behaviour framework to support its brand values. This was designed to influence how people at all levels within the organisation could work and make decisions. These behaviours emphasise the values of the organisation. AEGON also introduced a Management Development Programme. The eight behaviours are: Think customer Embrace change Encourage excellence Act with integrity Decisive action Work together Learn and grow Relate and communicate. 4. Carry out the implementation of the above. Answer

AEGON undertook a brand audit. This audit looked at two aspects: the company internally how the organisation was positioned externally.

The purpose of the audit was to find out more information about the organisation. This helped AEGON to provide a more informed approach to the decisions that were needed to start the process of change. The audit showed that AEGON was solidly placed within the market. Their staffs were known for their considerable expertise, innovation and clarity of communication. The external audit also helped to discover where AEGON was positioned in relation to its competitors. People who were aware of AEGON saw it as being a refreshing and different organisation. However, there was evidence that people were confused about the breadth of what AEGON did because it traded under a number of different company brands. This led to creating a culture of change within the organization. The changes affected the organisation both internally and externally. Within the organisation, they influenced not only how people behaved but also how they communicated. The organisation has become more focused on the customer. The emphasis is on making information clearer for the customer to understand and the company easier to do business with. AEGON had to develop the brand and its reputation. It did this is a number of ways: External promotional campaigns emphasised the relationship between Scottish Equitable and AEGON. This helped to reinforce the local knowledge and the global power of AEGON in the UK. The CEO talked to the media about the need for change. The refreshing of the brand internally and externally resulted in strong positive feedback. AEGON has launched new and innovative products. For example, the 5 for Life annuity has helped to change the way in which consumers can look at their retirement income. It provides more certainty about levels of income for the consumer, with AEGON providing the levels of return promised and being responsible for any risks associated with doing so. External factors will always be there to influence business organisations. AEGON responded to these factors by simplifying, clarifying and strengthening its brand in the UK. As organisations change, their patterns of behaviour and business culture develop. For AEGON, this is a cycle in which the business uses its knowledge to learn from its experiences. This has helped AEGON as an organisation to move positively towards achieving its full potential and to remain competitive in an increasingly difficult market.