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IAI Actuarial Core Principles · Business Management · Mission, business strategy, teamwork and time management

Sahyadri Life, a mid-sized Indian insurer, is drafting a new corporate plan. The board wants a short statement that explains why the company exists, whom it serves and what it does, which will stay stable for many years and guide all later strategy. Which element of the strategic planning hierarchy is the board describing?

The board is describing a mission statement. It states why the organisation exists, whom it serves and what it does, and it stays stable over many years, guiding later strategy, unlike budgets, action plans, targets or SWOT analysis which are shorter-term or analytical tools.

  1. AA mission statementCorrect
  2. BA quarterly budget
  3. CA tactical action plan
  4. DA SWOT matrix
  5. A departmental performance target

Explanation

A mission statement sets out an organisation's purpose, its customers and its broad activities, and it is long-lasting. Budgets, action plans and targets are shorter-term and operational. A SWOT matrix is an analysis tool used to inform strategy, not a statement of purpose.

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