summarizing

  Prepare a maximum 200-word synopsis summarizing what the team has learned from the review and discussion. Please make sure to include specific recommendations for each of the submitted papers. 

Propose detailed feedback and critical analysis team members can incorporate into their drafts.

 

8

First Citizens Community Bank: Proposal of New Division

First Citizens Community Bank: Proposal of New Division

First Citizens Community Bank is located in Mansfield, Pa and has 28 branches all over northeastern pa (https://www.firstcitizensbank.com/). They offer services that include checking and savings accounts, mortgages, personal, agricultural and car loans, business services, and investments. First Citizens Community Bank is committed to improving the lives of their customers, which is evident in their mission and vision statement. One issue that First Citizens is currently having is that their money going out through loans is exceeding their money coming in through new accounts and deposits. One way to add cash flow is to add an insurance division. This serves many purposes, including adding much needed cash flow, and adding yet another service to their customers, all while following the mission, vision, and values First Citizens holds dearly. When customers take out a loan or mortgage, often insurance is required by the bank. By offering insurance First Citizens is catering to their customers, while developing a competitive advantage in both banking, and insurance. In addition, the insurance division has a mission and vision statement that will guide the new division and their strategic planning. These statements align with the company’s statements which will provide unity between the two divisions. Insurance is a billion-dollar industry with monthly cashflows that will help First Citizens continue to grow and serve their customers in the future.

New Division

The proposed new division for First Citizens is an insurance division. This division will offer home insurance, vehicle insurance, and flood insurance. These three products are complimentary to auto loans, and mortgages. In addition, First Citizens requires customers to carry insurance on cars and homes when they take out a loan. This relationship is important for the new insurance division and offers customers quick and convenient access to insurance. The insurance divisions mission statement is “Reliable, quality insurance conveniently located in every First Citizens Bank, with competitive rates, and knowledgeable agents.” This mission statement will let customer know what the new division does, which is an important component of a mission statement (David, & David, 2017). The insurance can either be paid in conjunction with the loan or separately. Fist Citizens will also offer customers loans and insurance in a bundle to make it easy for them to get their loan and insurance. This differentiates First Citizens from other banks because it offers customers the convenience of one stop shopping. The new insurance division is differentiated from other insurance companies, because they have access to new customers immediately. This also gives the new insurance division a competitive advantage by eliminating the need for customers to “search” for insurance. The new insurance division actually serves the customers in the same way, by offering the convenience of insurance at the point of sale for the loan. Finally, the new insurance division will allow First Citizens to offer bundle discounts to customers on their loan rates, and insurance premiums. This will also give Fist Citizens insurance division a competitive advantage because it will be able to offer customers the best combination of rates and premiums. These points are furthered in the insurance divisions vision statement.

Vision and Business Model

First Citizens insurance division will follow a business model like most insurance companies. It will offer insurance for a monthly premium, provide service and support via agents, and offer an array of deductibles to meet customers’ needs and preferences. When a claim is made an agent will assess the damage and do the necessary paperwork to fulfill the insurance policy. The key difference is that First Citizens will use the monthly insurance premiums as a cash flow that will help supplement their loan operations. Since First Citizens has a reserve mandated by the FED, they will always have enough cash on hand to fulfill an insurance claim, but the added cash flow will allow the banking division to generate profit for the entire organization. The basis for success of the insurance division is that they will have the first shot at providing insurance to new customers. When a loan is approved in the banking division, the insurance agent will then layout the plans and coverages for the customers. This will be convenient and relieve the burden on the customer to secure insurance elsewhere and forward the necessary documents to the bank to complete the loan. The insurance divisions vision statement is “First Citizens insurance divisions vision is to provide quality, and reliable insurance to customers conveniently located in every First Citizens Bank to ensure the success of our customers and shareholders alike”. A vision statement is meant to show the direction of the division going forward (David, & David, 2017). First Citizens will authorize one of its bank employees at each location to quote insurance rates, however, final approval will come from the corporate office. There will be a VP of the insurance division that will oversee it and answer directly to the CEO of First Citizens.

Two Divisions United

First Citizens Bank is very customer oriented and emphasizes personal relationships. Their mission statement is “Your Success is Our Mission” (https://www.firstcitizensbank.com/). This is a broad mission statement, but really shows how their products and services are targeted toward the best interest of their customers. This aligns with the new insurance divisions mission statement because as part of overall success, customers will need to insure the items (house or car) that they are taking out a loan on. By offering insurance in conjunction with the loan it allows customers easy access to insurance in every branch. Similarly, the vision statement of the insurance division aligns with First Citizens vision statement, which is “To ensure our long-term survival as a highly successful independent community bank by consistently exceeding customer expectations, cultivating effective employees, delivering superior shareholder value and exhibiting social responsibility and good citizenship. (https://www.firstcitizensbank.com/)” The key is that the insurance is located in every branch, which adds to the community feel of the bank. Also, few banks offer insurance so this new division will help First Citizens to continue to exceed customer expectations. Finally, the added cash flows will help First Citizens to continue to be profitable which adds to shareholder value. In addition to aligning with First Citizens banking division, the vision, mission, and values will also be valuable for the strategic direction of the new insurance division.

Strategic Direction

The vision, mission and values of First Citizens insurance division guide the strategic plan of the new division in many ways. The mission statement includes reliable and quality, two things that are very important for the new division, as it will have to earn the trust of its customers. Often insurance is purchased based on reputation or history. Since First Citizens does not have a reputation in the insurance business and no historic customers, it will be imperative to exude quality and reliability. Similarly, competitive rates, and knowledgeable agents are listed. As part of the strategic plan First Citizens will have to train or hire employees with knowledge of insurance. This point is furthered through the visions statement, which calls for an insurance representative in each branch. With the large number of branches, it may not be feasible to hire that many new people, so part of First Citizens strategic plan will be to delegate insurance responsibilities to an employee in each branch. Once these employees are trained or insurance minded employees are hired, First Citizens insurance will utilize HARD goal setting. HARD stands for heartfelt, animated, required, and difficult (Bird, Smith, 2016). The HARD goal setting model surveys employees to determine which goals are most likely to drive great accomplishment (Bird, Smith, 2016). A heartfelt goal represents values that employees are passionate about. An animated goal is vividly painted and depicts how success should look and feel. A required goal is critical to the success of the division. Finally, a difficult goal challenges employees to leave their comfort zone, increase skill and knowledge, and elevate performance (Bird, Smith, 2016). The HARD survey will yield the goals that are important for employees and will be used to derive the strategic plan. This is a way of including as many employees as possible so they get behind the strategic plan. Also, there is an implied convenience in both the mission and vision statement, so the designated insurance representative should be present when customers are applying for loans. One last note on First Citizens insurance strategic plan is that loan rates and insurance premiums will be able to be manipulated to ensure the customer is in the best position for success. In addition, this will make First Citizens insurance more attractive to customers, which will lead to the overall success of First Citizens and its stakeholders. However, this could cause some ethical issues, so the insurance divisions guiding principles and values will be important.

Guiding Principles

The insurance division will face some important culture, social responsibility, and ethical issues, so guiding principles, and values will be important to maneuver these issues. One of the biggest issues the new division will face is an ethical issue. There will be times that the agents will think about adjusting the premiums or loan rates to secure a customer. In these instances, the agent should refer to the vision statement, and only make deals that are in the best interest of the customer and the stakeholder. Similarly, in this situation agents should exude social responsibility. Suspicious business practices to make a sale will reflect poorly on the entire organization. Another issue that First Citizens insurance division will face is a cultural issue because they have branches located in a prominent Amish area. The loans that come from this area can be for anything from livestock, to a community church. The agents at First Citizens will need to respect the culture of these different demographics and respect their right to choose their own insurance. To assist agents in dealing with the issues discussed above, a set of guiding principles and values will be in place for reference. The values of First Citizens insurance are that agents should always act in the best interest of both the customer and the stakeholders. Their decisions should reflect the mission and vision statements set forth by First Citizens insurance division, and the insurance division as well as the banking division are both equal opportunity for both employees and customers. These guiding principles should be used to navigate any questionable situation for the insurance division.

Conclusion

First Citizens insurance division will take on many of the same values of the banking division. Customer success is important, and through quality and reliability the agents will provide insurance in conjunction with loans and mortgages. The convenience of the one-stop business model will give First Citizens a competitive advantage in both divisions. Implementing the mission and vision into the strategic plan will also be important and will help to deal with ethical, cultural, and socially responsible situations. Moving forward, the insurance division will have to continually make sure its mission vision and values align with the bank division. This will ensure the long-lasting success of both division and First Citizens as a whole.

References

Bird, S., & Smith, E. (2016). Strategic Planning is HARD. Texas Library Journal,92(1), 10-11. Retrieved January 29, 2018, from https://search-proquest-com.contentproxy.phoenix.edu/docview/1788990537/fulltext/BB1D4CC796774E25PQ/1?accountid=35812.

David, Fred R. & David, Forest R. (2017). Strategic Management: A Competitive Advantage Approach, Concepts and Cases (16th ed.). Upper Saddle River, NJ: Pearson Education, Inc

First Citizens Community Bank. (2017). Retrieved January 29, 2018 from https://www.firstcitizensbank.com/

Strategic Plan Part I: Proposal of a New Division

Strategic Plan Part I: Proposal of a New Division

The economy today is fast paced and constantly growing. In order to keep up with the fast-paced economy, businesses must come up with strategic plans to be able to maximize all opportunities. 24 Hour Fitness is a fitness center chain that allows members to visit the gym at any hour of the day. The organization is looking to expand and open a new division to offer more perks and options in the membership. This paper will discuss the mission and vision statements for 24 Hour Fitness’ new division and how it addresses customer needs and achieves competitive advantage. This paper will also discuss how the new division’s mission and vision aligns with the company’s current mission and vision as well as summarize how it will guide the division’s strategic direction. Finally, it will define the guiding principles and values for the division in the context of culture, social responsibility, and ethics.

New Company Division

24 Hour Fitness is looking to expand and open a new division called Fitness 2 Go. Fitness 2 Go is an online service that will provide members access to online personal training modules that can be done virtually anywhere. The mission statement for Fitness 2 Go is “Helping everyone achieve a fit and healthy lifestyle anytime, anywhere, no excuses”. Fitness 2 Go is designed to cater to the individual who has little time to go to the gym. Our mission is to inspire members to live a healthy lifestyle even when there is little time to spare. It offers a variety of workouts that can be done at any time and each workout is tailored to the specific needs of the member. The program comes in the form of an application that can be downloaded at no charge. The application also provides workout and fitness tips, a virtual personal trainer, meal plans, health tips, and much more. The application also tracks your workouts, diets, calorie intake, and makes recommendations based on the members’ specific needs. The difference between 24 Hour Fitness and Fitness 2 Go is that Fitness 2 Go is tailored for the individual who does not have the time to make it to the gym every day. This serves as an option to still incorporate a healthy lifestyle in one’s daily routine. Fitness 2 Go addresses consumers needs by giving them an easier option for living a healthier lifestyle. The organization can achieve a competitive advantage because there are not many gyms that offer this service. While most gyms offer amenities and classes for their members, they do not offer an option for people who find it difficult to make it to the gym due to their busy lifestyle. Fitness 2 Go can help change many people’s lives with a simple click of a button. The vision for Fitness 2 Go is to inspire people to live a healthier and ‘no excuse’ lifestyle while on the go. The company wishes to create a motivational source for people who do not have time or means to go to the gym and will offer them everything they need to live a healthier lifestyle.

The Business Model

Business: 24 Hour Fitness, a fitness center chain that allows members to visit the gym at any hour of the day. 24 Hour Fitness is the perfect gym for people who want the best fitness classes, premium gym amenities and 24-hour access to the facility.

New Division Idea: Fitness 2 Go, an online service that will provide members access to online personal training modules that can be done virtually anywhere. Includes meal prepping and planning, activity and weight tracker, tailored personal trainer, hundreds of workouts that can be done anywhere at any time, a variety of health tips and recommendations, and much more.

Consumers: The target audience for this service would be anyone with limited time to go to the gym and is looking to achieve a healthier lifestyle. The workouts can be tailored to any age group and gender. Therefore, this service would be ideal for anyone.

Market: There are several services similar to Fitness 2 Go but none that cater to each individual need. Competitors have workouts that are generic and not specific for each person and their individual needs. Fitness 2 Go is tailored to meet the needs of each consumer. The workouts are personalized depending on your age, goals, time, and individual needs. This service is the first of its kind in the market.

Valuation: Fitness 2 Go ranges from $25 to $50 a month depending on the membership from 24 Hour Fitness. An individual with a membership for 24 Hour Fitness is given a discount for the service, however, a gym membership is not required to join Fitness 2 Go. Each member will receive a welcome kit with complete program information and gifts.

Financial Analysis: The service requires members to have a fitness tracker that will be provided with each membership. These trackers, along with software programs, are estimated to range from $500,000.00 or more in initial startup costs.

Marketing Plan: When conducting a market analysis, it is determined that the best way to promote the product would be through online advertisements and social media. The service will also be promoted in every 24-Hour Fitness gym location as well as mailouts with promotional discounts.

Competition: Fitness 2 Go is the first of its kind to custom make workouts, meal plans, and more specifically to the individuals needs. The competition offers a similar service but without the benefit of having unique information for each specific member. Also, Fitness 2 Go provides a universal fitness tracker at no additional cost where the competition simply offers a discount on the purchase on one of their own.

Risk: Like most organizations, Fitness 2 Go faces the risk of members cancelling their services or limited number of members joining. This division requires an initial investment that may be lost if not enough members join and member retention is lost.

Alignment of Mission, Vision, and Value

The mission and vision statements for 24 Hour Fitness can help guide employees and managers toward the path for success. The mission statement for 24 Hour Fitness is to provide an entertaining, educational, friendly and inviting, functional and innovative experience of uncompromising quality that meets the health and fitness needs of the entire family. Their vision is to make fitness a way of life by creating the ultimate in multi-sport fitness centers and making them affordable and accessible to people of all abilities and fitness levels (24 Hour Fitness, 2017). The mission, vision, and value of Fitness 2 Go aligns with the mission and vision of 24 Hour Fitness because it is infused to work hand in hand with what the gym itself wishes to achieve. The new division provides a convenient way to help members achieve their desired objectives. By taking into consideration what 24 Hour Fitness is looking to achieve, managers know what plans and actions they need to take to meet the company’s mission. Employees and managers may use the core values of the company to represent the company the way it is intended. Managers must align their actions to meet the needs of consumers and fulfill the mission statement.

Guiding Principles and Values

The guiding principles and values of Fitness 2 Go are what drives the company to achieve success. By aligning the mission and vision of the company, the division will provide convenience, flexibility, and affordable costs to the consumer. This can help drive the company where it wants to go and allow for easy business strategic planning. Morals and social obligations are essential for any business. Culture, social responsibility, and ethics play a major role in the success of a business. 24 Hour Fitness and Fitness 2 Go focuses on the well-being of every member and puts forth maximum effort to control unethical behavior. The company strives to succeed and holds it employees and guests at the highest level of integrity.

Conclusion

In conclusion, 24 Hour Fitness is looking to expand and open a new division to offer more perks and options in the membership. Fitness 2 Go will offer state of the art virtual fitness workouts that can be accessed from anywhere at any time. The divisions mission and vision statements provide a clear understanding of what the company is doing and where it wants to go in the future and the way it aligns with the current statements for 24 Hour Fitness. Knowing the mission and vision statements the company strives to achieve the new division will be able to succeed and help deliver the company’s purpose with ease.

References

David, Fred R., Forest David. Strategic Management: A Competitive Advantage Approach, Concepts and Cases, 16th Edition. Pearson Learning Solutions, 4/2016.
Business Model (2017). Retrieved from: https://www.investopedia.com/terms/d/distribution-channel.asp
Scott, R.E. (2015). Consumer Marketing: Strategies for Success. Retrieved from: https://www.epi.org/publication/consumer-marketing-strategies/67422
24 Hour Fitness (2017). Mission and Vision. Retrieved from: http://www.24hourfitness.com