The impact of financial tsunami on operations performance comparison company between prudential financial and American international group

• Main Authors: Ming-Li Wang, 王明禮
• Other Authors: Shih-Kuo Yeh
• Format: Others
• Language: zh-TW
• Published: 2009
• Online Access: http://ndltd.ncl.edu.tw/handle/00233794816935864442

碩士 === 國立中興大學 === 高階經理人碩士在職專班 === 97 === ABSTRACT The global economic had been strongly influenced by the financial Tsunami, which starts the financial crisis in August 9, 2007. Since the subprime mortgage erupts and causes a succession of economic storm, the investors lose the confidence to the mortgage backed security. This event becomes the liquidity crisis, even if the central bank of many countries infuses the large amount fund to the financial market many times, the financial crisis still happened. Until 2008, the financial crisis starts out of control: the global stock market falls suddenly; many large-scale financial organs go out of business or are taken over control by the government. The Iceland even therefore goes bankrupt. After these events, many international investment banks goes out of business, the insurance company appears significant difficulty on management. The business model and the role localization should be pondered by the insurance company. In this financial Tsunami, American International Group (AIG) suffered the heavy losses. The AIG will go out of business if the government didn’t offer support. Except AIG, there are some large-scale insurance companies suffered the heavy losses in Europe and England. But there still some insurance companies with the same scale hadn’t come under the serious influence, for instance, the Prudential Financial (PRU). In this study, the reason forms the finance Tsunami will be discussed. The influences to the overall insurance business will also be made a comprehensive discussion in this study. This study is using the AIG and PRU as examples to discuss the reasons which enable two companies having such difference in this big Tsunami. The management idea, the management strategy and the financial report will be compared with AIG and PRU item by item. And try to finding the connection between the difference and management achievements, and also understanding the influences in company long-term development, management model and trade development by management idea and management strategy. AIG Corporation doesn’t narrate their management idea especially, so the company development has been following the opportunity. Because of no management idea, the management development is depended on the management strategy which is growing primarily, that is the service multiplication can enhance the overall company achievement stability. Therefore, AIG strengthens the life insurance service on the one hand; on the other hand, AIG speeds up entering the foreign insurance market and infiltrates 130 countries successfully. AIG Corporation has formed a defined expansion mentality gradually, which expanses to the domain of using the AAA rating, the abundant capital, the risk management skill and the intelligence capital. Under this expansion management strategy, the AIG Corporation decides to establish the American International Group Financial Products (AIGFP), enters the emerging derivative finance commodity market. Plants defeat’s seed. PRU thought that the enterprise management is a marathon, not a dash. In a marathon match, the personality and the moral character are more important than the technology. The moral character is more important especially in the unusual time; it is the key that makes the enterprise managing for a long time. Regarding PRU, “the talented person” who has the “engaged in the mind service” ability, who must have likewise the heart to the customer, who understands the customer’s demands, who always put the customer benefit first, and who makes the correct decision. Such personality, will not walk the shortcut because of the environment change in the unusual period, in addition the specialized technology, that’s why the service having “the quality.” The PRU management strategy makes its development way not expands outward, but increases the depth, starting from the staff’s moral specialty and the quality promotion. Which provides the customer to be more intimate, conforms to the demand product and the service, hoped that maintains longer-term relations with the customer. The different idea and the strategy make the corporate culture, the organizational structure, the development direction different. Business achievement has the enormous difference, so the company should have the explicit management idea establishment the main axle consensus building to be able the long-term stability development.