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IAI Actuarial Core Principles · Business Management · Communicating strategy; culture and structure in decision making; strategy case studies

A large Indian general insurer's board approves a strategy to move from agent-led sales to digital direct sales. Senior management announces it in a single email and holds no briefings. Six months later, branch staff and agents are confused and sales fall. Which is the most appropriate conclusion about the failure?

The failure is best attributed to ineffective communication of the strategy. A single email with no briefings left staff and agents confused and unsupportive. Nothing in the facts shows the digital strategy itself was unsound, so the conclusion should focus on implementation and engagement of stakeholders.

  1. AThe strategy was wrong because digital sales cannot succeed in India
  2. BThe failure shows that competitive forces were ignored in the analysis
  3. CThe strategy was not communicated effectively, so stakeholders could not understand or support itCorrect
  4. DThe firm's mission statement should have been abandoned
  5. The firm should have avoided any change in its distribution structure

Explanation

The facts point to poor communication: a one-way email, no briefings and resulting confusion. This does not show the strategy itself was unsound or that digital sales are unworkable. Effective communication to staff and agents, with two-way engagement, is needed for implementation.

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