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IAI Actuarial Core Principles · Business Management · Strategy, competitive advantage, strategic decision process and PEST analysis

Suraksha Life, an Indian insurer, has a board-approved plan to become the leading provider of retirement products in tier-2 cities over the next ten years. The CEO says the plan sets the long-term direction and the scope of the organisation's activities, and decides how resources will be matched to the changing market and stakeholder expectations. Which description best fits this plan?

The plan is a corporate-level strategy. Strategy concerns the long-term direction and scope of an organisation and how its resources are matched to the market and stakeholder expectations. Daily schedules, quarterly budgets, agent targets and compliance checklists are operational or tactical matters rather than overall strategic direction.

  1. AA corporate-level strategy that sets overall direction, scope and resource matching over the long termCorrect
  2. BAn operational plan that schedules daily tasks for the policy-servicing team
  3. CA tactical budget that allocates next quarter's expenses to branches
  4. DA short-term sales target for individual agents
  5. A compliance checklist for IRDAI filings

Explanation

Strategy is concerned with long-term direction, scope of activities and matching resources to the environment and stakeholder expectations. A plan covering the whole organisation's direction is corporate-level. The other options describe short-term or narrow activities, which are operational or tactical, not strategic.

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