CHAPTER 1 INTRODUCTION A student of management gets an opportunity to apply and test the theoretical knowledge which he attains through his academic study, only when he gets acquainted with the functioning of an organization ; either as an employee or as an apprentice/ trainee. This is because novice is able to correlate the theoretical principals with the actual working environment only in such a situation. With the aforesaid fact in mind, an attempt has been made, observe the working of a manufacturing organization very closely and assess the performance of its different departments / divisions and various systems and procedure installed there in. so a manufacturing concern (ltd company) which is one of the market leaders in its field of operation has been selected for the study. Market potential is the limit approached by market demand on industry marketing expenditure 1
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CHAPTER 1
INTRODUCTION
A student of management gets an opportunity to apply and test the theoretical
knowledge which he attains through his academic study, only when he gets
acquainted with the functioning of an organization ; either as an employee or as an
apprentice/ trainee. This is because novice is able to correlate the theoretical
principals with the actual working environment only in such a situation.
With the aforesaid fact in mind, an attempt has been made, observe the working
of a manufacturing organization very closely and assess the performance of its
different departments / divisions and various systems and procedure installed there in.
so a manufacturing concern (ltd company) which is one of the market leaders in its
field of operation has been selected for the study.
Market potential is the limit approached by market demand on industry
marketing expenditure approach infinity for a given marketing environment. A market
is a set of all actual and potential buyers for might exist for a particular market offer.
The market is the set of consumers who profess a sufficient level of interest in a
market.
The issue of market potential seems to be the key in assessing the sustainability
challenge of a product/service. This element forms the linchpin to constructing the
Eco-space Audit that incorporates the notion of sustainable consumption or end use
levels.
1
It is important to distinguish between products that have full market potential
and products/services that are still increasing their market share. A factor 10
improvement of a product that is fully penetrated into the market at a global level (so
for 6 billion consumers) indeed leads to a factor 10 reductions in final consumption of
resources in an absolute sense. If a product has a low market penetration this is not the
case. For the example, think of computers with a penetration level of somewhere
around 20-30% in industrialized countries. At the global market level this is probably
only 5%.Here it is clear that a factor 10 improvement in this technology will not be
sufficient if we accept that in the long term we will be living in a world with 10
billion consumers with (on average !) relatively high levels of free disposable income.
1.1 INDUSTRY PROFILE
Variety is the spice of life, unless you're in the insurance business.
Traditionally, the most successful insurance firms generally take on the least risk.
However, factors such as deregulation, globalization, the Internet, and the events of
September 11 are shaking up the industry.
The life insurance industry (about 60% of worldwide premiums) has changed
the most profoundly in the products it sells. Over the last quarter of a century, life
insurers such as AXA, ING Group, Nippon Life, and Assicurazioni General, have
seen their business shift from life insurance coverage to annuity products. This
fundamentally changes the way life insurance firms do business, as they concentrate
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on managing investment risk, rather than the mortality risk of an individual. As a
result, insurance firms now compete more directly with financial services firms.
The Gramm-Leach-Bliley Act in the US and "Big Bang" financial
deregulation in Japan opened the door for banks and insurance firms to combine their
businesses. In Europe, global financial services titans already exist, notably German
insurance company Allianz (with stakes in Deutsche Bank, HVB Group, and
Dresdner Bank), and Swiss bank Credit Suisse , Foreign firms seeking inroads to the
US and Japan finds themselves freed from regulatory shackles, too.
As regulatory barriers fall, consolidation among insurance groups,
particularly nonlife insurers, is on the rise. The top 10 property/casualty companies
(including State Farm, Aviva, American International Group, and Zurich Financial
Services) already account for almost half of all premiums written. A dwindling
number of local firms are left to fight for the remaining scraps of market share.
The Internet has changed the way insurers are doing business. Companies
are continuing to offer more products via the virtual highway, thus increasing the
competitive marketplace. With the insurance markets in the US and Japan becoming
saturated, growth in other markets (particularly South America) is imperative for a
company's success, as well.
The attacks on the World Trade Center have changed the face of the
insurance industry; issues such as asbestos claims and liability suits have taken a
backseat to the mad scramble of how to cover terrorism. As a result of September 11,
and to a lesser degree the Enron scandal, premiums are rising and underwriting
standards are tightening. A slew of new ventures have started up (primarily Iq-
Bermuda), as insurers see the possibility of lucrative business.
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In 2004 the insurance industry came under scrutiny when New York
Attorney General Eliot Spitzer sued Marsh & McLennan, the world's largest
insurance brokerage, for price fixing and for accepting kickbacks. As a result, Jeffrey
Greenberg was forced to resign as CEO of Marsh & McLennan, along with five other
executives who admitted to rigging bids. The probes continue as Spitzer and other
officials look to clean up the industry.
1.2 About Life Insurance
There are three parties in a life insurance transaction: the insurer, the insured,
and the owner of the policy (policyholder), although the owner and the insured are
often the same person.
Another important person involved in a life insurance policy is the beneficiary.
The beneficiary is the person or persons who will receive the policy proceed upon the
death of the insured.
Life insurance may be divided into two basic classes.
They are
I. Term
II. permanent
• Term life insurance provides for life insurance coverage for a specified term of
years for a specified premium. The policy does not accumulate cash value.
• Permanent life insurance is life insurance that remains in force until the policy
matures, unless the owner fails to pay the premium when due.
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• Whole life insurance provides for a level premium, and a cash value table
included in the policy guaranteed by the company. The primary advantages of
whole life are guaranteed death benefits, guaranteed cash values, fixed and
known annual premiums, and mortality and expense charges will not reduce
the cash value shown in the policy.
• Universal life insurance (UL) is a relatively new insurance product intended to
provide permanent insurance coverage with greater flexibility in premium
payment and the potential for a higher internal rate of return. A universal life
policy includes a cash account. Premiums increase the cash account
COMPANY PROFILE
Bajaj Allianz Life Insurance Co. Ltd is a joint venture between two leading
conglomerates – Allianz AG, one of the world’s largest insurance companies and
Bajaj Auto, one of the biggest 2 and 3 wheeler manufactures in the world. We at
Allianz Bajaj realize that you seek an insurer who can trust your hard earned money
with Allianz AG with over 110 years of financial experience in over 70 countries and
Bajaj Auto trusted for over 55 years in the Indian Market, together are committed to
offer you financial solutions that provide all the security you need for your family and
yourself.
ALLIANZ GROUP
Allianz Group is one of the world’s leading insurers and financial services
providers. Founded in 1890 in Beslin, Allianz is now present in over 70 countries with
almost 174000 employees. At the top of the international group is the holding
company Allianz AG, with its head office in Munich.
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Allianz Group provides its more than 60 million customers world wide with a
comprehensive range of services in the areas of property and Casualty Insurance, Life
and Health Insurance, Asset Management and Banking.
ALLIANZ AG – A GLOBAL FINANCIAL POWER HOUSE
World wide 2nd by gross written premiums Rs. 4,46,654 cr.
12th largest corporation in the world
49.8% of global business from Life Insurance
Established in 1890, 110 years of Insurance expertise
To countries, 173,750 employees world wide
BAJAJ GROUP
Bajaj Auto Ltd the flagship company of the Rs.8000 crore Bajaj group is the
largest manufacturer of two – wheelers and three – wheelers in India and one of the
largest in the world.
A STRONG INDIAN BRAND – HAMARA BAJAJ
One of the largest 2 & 3 wheeler manufacturers in the world
21 million + vehicles on the road across the globe
managing funds of over Rs. 4000 cr.
Rs. 4,744 cr. Turnover & profits of 538 cr in 2002 – 03
It has joined hands with Allianz to provide the Indian consumers with a distinct
option in terms of Life Insurance products.
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BAJAJ ALLIANZ LIFE INSURANCE
Is the fastest growing private life insurance company in India
Currently has over 400000 satisfied customers
One of Indian’s leading private life insurance companies
We have customer care centers in 155 cities with 30000 Insurance Consultant
providing the finest customer service
SHARED VISION
A house hold name in India, teams up with a global conglomerate of Bajaj
Auto Ltd, the flagship company of the Rs.8000 crore Bajaj group is the largest
manufacturer of two – wheelers and three wheelers in India and one of the largest in
the world. A household name in India, Bajaj Auto has a strong brand image and brand
loyalty synonymous with quality and customer focus. With over 15000 employees the
company is a Rs.4000 crore auto gaint, is the largest 2/3 wheeler manufacturer in
India. It is the 4th largest in the world. AAA rated by Crisit, Bajaj Auto has been in
operation for over 55 years.
As a promoter of Bajaj Alliance Life Insurance Co. Ltd, Bajaj Auto has the
following to offer.
A strong brand equity
A good market reputation as a world class organization
A 10 million strong base of retail consumers using Bajaj products
An extensive distribution system
INDIAN OPERATIONS
Growing at a break neck pace with a strong pan Indian presence Bajaj Allianz has
emerged as a strong player in India.
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Bajaj Allianz Life Insurance Company Limited is a joint venture between two
leading conglomerates Allianz AG and Bajaj Auto Limited characterized by global
presence with a focus and driven by customer, orientation to establish high earnings
potential and financial strength, Bajaj Allianz Life Insurance Company Limited was
incorporated on 14th March 2001. the company received the (IRDA) Insurance
Regulatory and Development Authority Certificate of Registration (r3) NO 116 on 3rd
August 2001 to conduct life Insurance business in India.
TIE UP WITH BANKS
Pioneers of Bancassurance in India:- Having pioneered the phenomenon, Banc
assurance is one of our core business strategies. Two of the strong Banc assurance tie
ups are :-
Standard chartered Bank
Syndicate Bank
PRODUCT PROFILE
Uncertainty is the only certainty in life. If the breadwinner of a family dies, the
income to the family ceases. If the breadwinner does not die, but retires from service,
even then the regular income to the family ceases. Thus life insurance has to cover
both the contingencies of death or survival. They vary according to contingency
provided for according to age, according to family size etc. Each plan of insurance
provides for a kind of need.
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Family :- Protection of the interests of the family against loss of income due to
death of the bread winners.
Children:- Provision for education, marriages and start – in – life
Old Age:- Post – retirement income for self and family / dependents
Special needs:- Disability, accidents, expenses for treatment of diseases, loss of
income due to sickness etc.
These are some basic elements in a life insurance products.
Risk cover : Benefit payable in the event of death
Saving : Benefit payable in the event of survival
PRODUCT OF BAJAJ ALLIANZ
a) ALLIANZ BAJAJ INVEST GAIN
This is a participating endowment plan (with regular and limited premium payment
term options) with minimum guaranteed benefits at maturity or death or maturity
benefit will be the “sum assured”. Besides the policy holder can opt for riders like
family income benefit, Comprehensive Accident Protection (comprising Accident
Death Benefit, Accidental Permanent partial and Total disbility Benefit, waives of
premium Benefit) critical illness Benefits and Hospital cash Benefit with the regular
terms.
Eligibility Conditions and Limits
CONDITIONS INVEST GAIN INVEST GAIN
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ECONOMY
GOLD/DIAMOND/PLATINUM
Minimum Age at Entry 0 (risk
commences at
age 7)
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Minimum Age at Entry 65 50
Minimum Age at Maturity 70 70
Minimum Term 5
Maximum Term 40
Minimum Sum Assured 50000
Maximum Sum Assured No limit
Minimum Premium
Limits
Rest 5000 for Annual mode, Rs. 25000 for H yearly, Rs.
2000 for quarterly, Rs. 700 for monthly.
Premium payment Term Equal to policy term or limited as per table
These are total of 4 product packages available in INVEST GAIN
PACKAGE IN – BUILT BENEFITS
Invest Gain Economy Base Package
Invest Gain Gold Base Package = In built Term cover
(Additional Death Benefits)
Invest Gain Diamond Base Package + In built DoubleTerm
cover (Additional Death Benefits)
Invest Gain Platinum Base Package + In built TripleTerm cover
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The customer may select any 1, 2, 3 or 4 or any combination or all of the following
additional benefits with any of the packages.
1. Family Income Benefits
2. Comprehensive Accident Protection
3. Critical Illness Benefits
4. Hospital Cash Benefits
Of the above 4 benefits only Family income benefit will be available for limited
premium payment terms.
7 at the time of death, then the premiums paid are refunded.
b) ALLIANZ BAJAJ CASH GAIN
This regular premium payment participating money backs plan with minimum
guaranteed benefits at survival (through regular cash benefit during the policy term
including maturity.). The guaranteed minimum death benefits will be the “Sum
Assured” which will be the irrespective of the cash benefits already paid.
Eligibility Conditions and Limits
Minimum and maximum age at entry for all the additional benefits viz. Family
Income Benefit (FIB), Comprehensive Accident Protection (CAP), Critical
illness and Hospital cash is 18 years and 50 years.
Comprehensive Accident Protection, Critical illness and hospital cash
coverage expires at attained age 65 or at maturity whichever is earlier
Issue ages 12 to 55 attained at entry, depending on the package
There are a total of 4-product package available in cash gain.
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Package In – built Benefits
Cash Gain Economy Base Package
Cash Gain Gold Base Package = In built Term cover
Cash Gain Diamond Base Package + In built DoubleTerm
cover
Cash Gain Platinum Base Package + In built Triple Term
cover
Death BenefitIn case of death of maturity after 15 full policy years, the company may pay terminal
bonus for in force policies.
Survival / Maturity BenefitIn case of survival on to maturity all declared reversionary bonuses plus interim
bonus plus a possible terminal bonus is paid on Maturity in addition to 50% of the
sum assumed.
Premium DiscountPremium Discount will be offered for all policies where the sum assured exceeds the
minimum sum assured by at least 10000. Then discount is Rs. 96 for each full Rs.
10000 by which the sum assured exceeds the minimum sum assured Rs. 50000.
c) ALLIANZ BAJAJ CHILD GAIN
This is a participating endowment plan with minimum guaranteed benefits payable on
the child attaining specific ages after the premium payment term but during the policy
term that ends with the final payouts. The main life assured (LA) is the child with the
policy holder (parent / legal guardian) being the counter life assured (CLA).
Eligibility condition and limits.
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The premium payment term is to be ascertained as the period from the date of
commencement till the policy anniversary following the birthday when the child
attain 18 years old age.
The policy term will be between 11 to 24 years for the age of child = 24 at maturity
and 8 to 21 for age of child = 21 at maturity.
The policy term is to be ascertained the period from the date of the commencement
till the due date of the last guaranteed payout as opted.
The policy term age of policyholder (CLA) should not exceed 70 for this plan.
There are total of 4 product packages available in child gain.
Allianz Bajaj child gain 21 Base package + premium benefit + family income
benefit.
Allianz Bajaj child gain 24 Base package + premium wavier benefit + family
income benefit.
Allianz Bajaj child gain 21
Plus
Base package + premium wavier benefit + family
income benefit+ start of Life Benefit.
Allianz Bajaj child gain 24
Plus
Base package + premium wavier benefit + family
income benefit+ start of Life Benefit
Start of life benefit
For a nominal amount an additional sum assured subject to a maximum limit
of Rs.10 lacs per policy will become payable to enable the child start. His/her
professional life smoothly, in case of an unfortunate death or accidental permanent
total disability of the policy holder (CLA) during the term of the policy.
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Death Policy
On death of the Counter Life Assured (CLA)
All future premiums shall be waived
Family Income Benefit shall commence @ 1% of sum assured per month.
Guarnteed payout shall continue as per schedule.
d) ALLIANZ BAJAJ SWARNA VISHRANTI
This is a participating retirement capital building plan with life cover, to help people
to save and plan for their retirement. This is specially useful for self-employed people,
businessman and employees who do not have any pension cover to provide them with
a regular income post retirement. This plan also acts as an important supplement to
the retirement income for salaried people. The product is also attractive as it offers tax
relief under section 80 CCC(1) up to a ceiling of Rs.10,000/- per annum.
It is a regular premium paying fixed different period plan, which will provide
annually on reaching a predetermined age (age at vesting) at the end of the deferment
period.
Eligibility conditions and Limits
Issue age 18 up to 50 for all the additional benefits via Term Cover Benefit,
Family Income Benefit FIB), Comprehensive accident protection, critical
illness and hospital cash.
Comprehensive accident protection, critical illness and hospital cash coverage
exoires at vesting age or attained age 65 which ever is earlier.
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Eligibility Limits
1 Minimum Sum Assured Rs.50,000/- for Regular Premium
2 Maximum Sum Assured No Limit
3 Minimum age at entry 18
4 Maximum age at entry 65
5 Minimum Deferment Period 5
6 Maximum Deferment period 40
7 Minimum age at vesting 45
8 Maximum age at vesting 70
9 Minimum Premium Rs.5000/- for the Annual Mode
Rs.2500/- for half years
Rs.2000/- for quarterly and
Rs.700/- for monthly mode.
Death Benefit
In case of death during the deferment period, the spouse will have the following
options:
(a) Receive immediately the sum assured and accrued bonuses in one lump sum
or
(b) Purchase an immediate annuity policy from Allianz Bajaj or any other
company for the full amount or a part of sum assured and Assured Bonuses.
e) ALLIANZ BAJAJ RISK CARE
This is non-profit level premium and single premium term Insurance plan
providing basically death cover equal to the sum assured. There are no survivator
maturity benefits. Besides the policies other than the single premium paln, the policy
holder can opt for additional benefits like- critical illness benefits and hospital cash
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benefit and accidental death benefits, accidental permanent total/ partial disability
benefit.
Eligibility conditions and limits.
Policy term can be selected for all terms between 5 to 40 years.
Ages 18 to 50 attained at entry for all packages.
There are two premium payment options available: Regular premium and
single premium. For regular premium payment option, the premium payment
term is equal to the policy term.
Coverage provided till maturity for all additional benefits.
Eligibility Conditions
Minimum age at entry 18
Maximum age at entry 50
Maximum age at Maturity 65
Minimum term 5
Maximum term 40
Minimum sum assured (Rs) Rs.100,000/-
Maximum sum assured (Rs) Rs.10,00,000/-
Minimum Premium (Rs) 800/- for yearly and 600/- for ½
yearly.
Minimum single premium
Rs.1600/-
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Death Benefit
The death benefit will be the sum assured. The policy terminates on death of the
policy holder.
Survival/ Maturity benefit
This is pure term insurance plan. There are no survival/maturity benefits payable
under this plan.
Surrender value
Not available under Allianz Bajaj risk care
Loans
No loans are available in Allianz Bajaj risk care.
Premium discount
Premium discount will be offered for all policies where the sum assured exceeds the
minimum sum assured of Rs.100,000/- by at least Rs.10,000/-
Flexibility In Coverage
At each policy anniversary the policy holder has the option to adjust his coverage
level of the additional benefit combinations. Additional benefit combination 2
(Critical illness Benefit and Hospital cash Benefit) can be taken at issue only. These
benefits can not be included subsequently at any policy anniversary.
Compensation Structure of Sales Manage for FY 2006-07
Keeping the contrasting views received on salary increases and decreases of
Sales Managers in mind, it has been decided to rationalize the salary structure and re-
designate the STMs. This does away with the disparity in earnings at Satellite and
Hub and brings in uniformity across the country.
Now there will be flexibility given in both Hubs and Satellites to appoint Sales
Manager at Grade 1,2 or 3 which will be totally at the discretion of the Branch
Managers and Chief Managers and keeping in view their past experience and last
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CTC drawn. However, in Metros i.e. Mumbai, Delhi, Kolkata, Chennai, Hyderabad,
Banglore, Pune and Ahmedabad, Sales Managers can be appointed at Grade 4 also
with Rs. 22000 monthly CTC. Any STM whose level is intervening in the current
grade, fitment for those STMs will be done in the next level and the remaining STMs
will only be re-designated as per the table given below.
All the Sr. STMs with Rs. 22000 monthly CTC will be placed in the Executive
Sales Manager cadre with Rs. 24000 monthly CTC with effect from 1st April 2006.
There will be uniform 6 Grades of Sales Managers in both Hubs and Satellites, their
grades, salaries and targets will be as per the below given table. This Compensation
and targets will be applicable from 1st April 2006.
The movement of Sales Manager from one grade to next higher grade is
subject to his achievement of the norms within 6 months. If he doesn’t achieve norms
in 6 months, then he would have to achieve the norms for 1 year to be eligible for
promotion to next higher grade. However, if he doesn’t qualify the norms for 1 year,
then he will have to achieve the next cycle of 6 months norms, to be promoted to next
higher grade.
If any Sales manager achieves the norms in less than 6 months, he doesn’t
have to wait for 6 months to be promoted to next grade, instead he will be promoted
in next higher grade from the 1st of the following month in which he attains the norms.
Therefore, there will not be any double promotion.
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New Sales Manager Levels and their Respective Targets
Current
Designation
Revised
Designati
on
Grades
CTC monthly
(Including
Reimbursement
s) (Rs.)
Qualifie
d No of
Ics
Unit
Size
Promotion
norms for
1st
6months,
Then
Minimum
Rated FYP
is
(Rs.)
Promotion
Norms if
Target is
achieved
After
6months
but not
more than
1year, then
Minimum
Rated FYP
is (Rs.)
Junior
Trainee STM
Junior
Sales
Manager
Grade 112000
=10000+20006 12 4,00,000 7,50,000
Grade2
Satellite STM
Assistant
Sales
Manager
Grade 215000
=12000+30009 18 5,00,000 10,00,000
Grade1
Satellite STM
Probationary
STM
Sales
ManagerGrade 3
19000
=15000+400011 22 6,50,000 12,50,000
Senior STM Senior
Sales
Grade 4 22000 12 24 8,50,000 16,00,000
19
Manager =18000+4000
Executive
Sales
Manager
Grade 524000
=20000+400012 26 10,00,000 19,00,000
Mentor
Sales
Manager
Grade 628000
=24000+4000
To get further promotion, he will have to
qualify as per the Deputy Area Managers
Norms
There is no change in the incentive structure of the Sales Manager and the
same will continue to apply for the FY 2006-07.
Reimbursement for Sales Manager will be against Mobile and Conveyance
bills (local Conveyance) which should be claimed together. (Separate Circular
Follows).
The concept of CCA is done away with.
In case of any ambiguity in interpretation, the interpretation of HOS will be
final and binding.
The salary, grades and target structure of sales manager is subject to change at
any time at the discretion of management.
Commission to IC
1) FOR CHILD GAIN / RISK CARE / TERM CARE - 40% total (15years
and above)
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Premium
payment termYear 1 Year 2 Year 3 Year 4+
15 years or more 25% 7.5% 7.5% 5%
10 to 14 years 20% 7.5% 7.5% 5%
5 to 9 years 10% 5% 5% 5%
In addition an additional first year commission of up to 60% of the first
commission will be payable to the agents
The commission rate for single premium is 2%.
2) CASH GAIN - 40% total
Premium
Payment Term
% of First Year
Premium
% of 2nd and 3rd
year premium
% of Subsequent
years premium
15,20,25,30 25 7.5 5
In addition an additional first year commission of up to 60% of the first year
commission will be payable to the agents.
3) LIFTIME CARE - 40% TOTAL (15years and above)
Premium
payment termYear 1 Year 2 Year 3 Year 4+
15 years or more 25% 7.5% 7.5% 5%
10 to 14 years 20% 7.5% 7.5% 5%
In addition an additional first year commission of up to 60% of the first year
commission will be payable to the agents.
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1.5 SCOPE OF STUDY
To acquire an overall idea of the organization and to know how theoretical
aspects of management are applied in real functioning of organization. It also includes
a detailed study on the analysis of the past performance and future trends of the
company.
This study will give an insight into understanding the perception of Insurance
Agents about the product & Services of Bajaj allianz Standard Life Insurance Also it
helps to acquire knowledge about the organization structure and its activities.
The study will also help the company to understand about the situation on the
following areas.
The competitors of Bajaj allianz Standard Life Insurance in kollam
Whether Bajaj allianz Standard Life Insurance Products are successful or not.
1.6 MARKET POTTENTIALITY- AN OVERVIEW
MARKET POTTENTIALITY
Market potential is the limit approached by market demand on industry
marketing expenditure approach infinity for a given marketing environment. A market
is a set of all actual and potential buyers for might exist for a particular market offer.
The market is the set of consumers who profess a sufficient level of interest in a
market. The issue of market potential seems to be the key in assessing the
sustainability challenge of a product/service. This element forms the linchpin to
constructing the Eco-space Audit that incorporates the notion of sustainable
consumption or end use levels.
22
Customer needs today are increasingly complex, even as product life cycles
get Increasingly shorter. In the resulting pressure to accelerate type to market, it's
critical, however, that companies not lose sight of the basics-develop products that
customers want when they want them. This way, success in the market place increases
as product s enjoy higher-than-average market acceptance.
Many companies in fact have started to focus on more research to analyse the
market". They have found that they have to reduce the cost of product and services to
penetrate into the market. The need to gain market acceptance is very important in the
current scenario. Yet, most of the time companies are not doing this. The answer
starts with recognizing that no matter how good your research is, a new product will
always have a gap in potential. This is the gap between your knowledge and what the
customer wants after launch. What is the best way to get from "almost there'" to "right
on target'' for market acceptance? One such tool is the PDCA, cycle. W.Edwards
Doming developed this management tool in the 1940s and 1950s as a strategy to gain
more advantage in the market. You can use it to get to market acceptance more
quickly. This helps to overcome the competition also.
The strategy is
1. Plan to do something
2. Do it
3. Check the results
4. Adapt
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The PDCA cycle has two major advantages
(1). The Process never ends, and therefore,
(2) small but quick improvements are perfectly acceptable.
HOW WE CAN PENETRATE INTO THE MARKET
Company’s characteristically develop their own strategies for reducing
perceived risk. These risk-reduction strategies enable them to act with increased
confidence when introducing new product and services, even though the
consequences of such decisions remain somewhat uncertain. This is mainly with the
part related with customer’s.
While introducing the new product and services the company will deals with the
following factors. They are
Information about the products and services.
Creating Brand Loyalty.
Creating Brand Image.
How they are different from others.
Information about product Quality.
Security and belief about the service / product.
Customer Satisfaction.
Market Acceptance.
CORPORATE IDENTITY, BRAND IDENTIYT AND BRAND IMAGE
It is important to distinguish between corporate identity, brand identity
and brand image. Corporate identity is concerned with the visual aspects of a
company's presence. When companies undertake corporate identity exercises, thy are
usually modernizing their visual image in terms logo, design, and collaterals. Such
efforts do not normally entail a change in brand values so that the heart of the brand
24
remains the same -what it stands for, or its personality. Unfortunately, many
companies do not realize this fallacy, as they are sometimes led to believe by agencies
and consultancy "companies that the visual changes will change the brand image. But
changes to logos, sign age and even outlet design do not always change consumer
perceptions of quality, service, and the intangible associations that come to the fore
when the brand name is seen or head.
The best that such changes can do is to reassure consumers that the
company is concerned about how it looks. Brands do have to maintain a modern look,
and the visual identity needs to change over time. But the key to successfully
affecting a new look is evolution, not revolution. Totally changing the brand visuals
can give rise to consumer concerns about changes of ownership, or possible changes
in brand values, or even unjustified extravagance. If there is a strong brand
personality to which consumers are attracted, then substantial changes may destroy
emotional attachments to the brand. People do not expected or like wild swings in the
personality behavior of other people, and thy are just as concerned when the brands to
which they have grown used exhibit similar "schizophrenic" changes
On the other hand, if the intention is to substantially improve the
standing of the brand, then corporate identity changes can be accompanied by
widespread changes to organizational culture, quality and service standards. If done
well, and if consumers experience a great new or improved experience, then the
changes will, over the longer term, have a corresponding positive effect oil brand
image. If you are spending a vast amount of money on corporate identity, it is as well
to remember this.
Brand identity is the total preposition that a company makes to
consumers-the promise it makes. It may consist of features and attributes, benefits,
performance, quality, service support, and the values that the brand possesses. The
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brand can be viewed as a product, a personality, a set of values, and a position it
occupies in people's minds. Brand identity is everything the company wants the brand
to be seen as. Brand image, on the other hand, is the totality of consumer perceptions
about the brand, or how they see it, which may not coincide with the brand identity
Companies have to work hard on the consumer experience to make sure that what
customers see and think is what they want them to.
Now leading-edge companies are becoming extremely sophisticated at
measuring what customer's value, and correlating these data with their behavior and
their projected future intentions. The results ate pinpointed marketing strategies that
win, and win big. Recent empirical research shows that a business's customer value
position, relative to competitors, has a dramatic impact on its market-share gain and
profitability. Businesses that achieve a superior customer value position average profit
margins on sales three times greater than businesses that are pushed into an inferior
customer value position.
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CHAPTER II
RESEARCH METHODOLOGY
INTRODUCTION
An organized, systematic, data-based, critical, objective, scientific inquiry
or investigations into a specific problems undertaken with the purpose of finding
answers or solutions to it. In essence, research provides the needed informations that
guide to make inform the decisions to successfully deal with the problems. It
comprises of defining and redefining of problems, formulating hypothesis or
suggested solutions, collecting, organizing and evaluating data making alterations and
reaching conclusion.
2.1 OBJECTIVES OF STUDY
Primary Objective
The primary objective of the study is to determine the market potential of
the Bajaj allianz Standard Life Insurance among
Secondary Objectives
The secondary objectives of the study are
a) To study the comparative analysis with the competitors.
b) To find out how far the Bajaj allianz Standard Life Insurance Products and
Services
has achieved its objective of capturing attention and creating corporate image.
c) To know the effectiveness of sales promotional activities.
d) To determine the suitable Marketing channel.
e) To know the perception of Agents about the Insurance Products.
f) To suggest necessary measures to improve the services
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2.2 METHODOLOGY
RESEARCH DESIGN
The research was carried out to find out the “Market Pottential of Bajaj
allianz Standard Life Insurance”.
Descriptive type of research was adopted to describe the state of affairs, as
it exists at present. It helps to portray accurately the characteristics of a particular
group of individuals.
SIGNIFICANTS OF PROJECT
Bajaj allianz wanted to know the market potential of Life Insurance.
Thus it required a detailed analysis of the market regarding the agent’s
expectation, customer perception, customer awareness of the product, customer
preferences, customer satisfaction etc. The project was carried out as a live project by
giving at most importance to the feasibility. The market analysis was conducted at
kollam, a big business city of Kerala, which thus could give a near perfect view of the
market. The project analyzed different aspects of market research, agent’s
expectation, customer satisfaction, consumer awareness of the product and its
features, etc. The project resulted in much benefit for Bajaj allianz such as
To Know about the Competitors.
Consumer’s perception about the product and services.
Consumer awareness of the product and its features were studied,
Satisfaction level of customers and agent’s were studied.
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PROBLEM IDENTIFICATION
The company wanted to analyse the market for life insurance, Competitors
details, and customer satisfaction about Bajaj allianz.
PROBLEM DEFINITION
To analyse the market of Bajaj allianz product and services, one has to
analyse the perception of the agent’s and customers about the product, awareness of
the product and its features, the satisfaction level of the existing etc. It should also
analyse the factors that influence the buying behaviour of the customer.
THE MARKETING RESEARCH PROCESS
Marketing research may be defined as a systematic design, collection, analysis
and reporting of data and findings relevant to a specific marketing situation facing the
company. Effective marketing research involves the five steps shown below:
Step 1: Define the Problem and Research Objectives
Management must not define a problem too broadly or too narrowly.
Step 2: Develop the Research Plan
The second stage of marketing research calls for developing the most efficient
plan for gathering the needed information. Designing a research plan calls for
decisions of data sources, research approaches, research instruments, sampling plan
and contact methods.
Step 3: Collect the Information:
The data collection phase of marketing research is generally the most
expensive and the most prone to error. In the case of surveys, four major problems
arise. Some respondents will not be at home and must be recontacted or replaced.
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Other respondents will refuse to cooperate. Still others will give biased or dishonest
answers. Finally, some interviewers will be biased or dishonest.
Step 4 : Analyze the Information:
The next-to-last step in the marketing research process is to extract findings
from the collected data. The researcher tabulated the data and develops frequency
distributions. Averages and measures of dispersion are computed for the major
variables. The researcher will also apply some advanced statistical techniques and
decision models in the hope of discovering additional findings. One of the tools for
analyzing the collected data is through hypothesis testing.
Step 5: Present the findings
As the last step the researcher presents the findings to the relevant parties.
The researcher should present major findings data relevant lo major marketing
decisions facing management.
2.3 SOURCES OF DATA
The researcher can gather secondary data, primary data of both. Secondary
data are that were collected for another purpose and already exist somewhere. Primary
data are data gathered for specific purpose or for a specific research project. A
customer or prospect database is organized collection of comprehensive data about
individual customer, prospects of suspects that is current, accessible and actionable
for marketing purpose such as lead generation, lead qualification, sale of product or
service, or maintenance of customer relationship.
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COLLECTION OF DATA
The researcher has taken efforts to study the market through data collection.
Data has been collected through both primary and secondary sources.
Primary Sources
The researcher has prepared questionnaires to collect market views about the
product. Response was encouraging as most people were willing to supply
information through questionnaires. The questions were willing to supply information
through questionnaires. The questions were adapted to the status and education level
of persons thus avoiding inconvenience and misinterpretation. The questionnaires
were used to collect information from Kollam city. It took quite a considerable
amount of time to collect information through these sources.
Questionnaires
A questionnaire consists of a set of question presented to respondents for their
answers. Because of its flexibility, the questionnaire is by far the most common
instrument used to collect primary data: Questionnaire need to be carefully
developed, tested, and debugged before they are administered on a large scale. In
preparing a questionnaire, the professional marketing researcher carefully chooses the
questions and their from, wording and sequence. The form of the question asked can
influence the response, Marketing researchers distinguish between closed-end and
open-end questions. Closed-end questions specify all the possible answers. Open-end
questions allow respondents to answer in their own words. Closed-end questions
provide answers that are easier to interpret and tabulate. Open-end questions often
reveal more because they do not constrain respondent's answers.
One of the tools used for testing hypothesis is Chi-Square test, which is as follows.
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Secondary Data
Secondary sources have been depended upon to collect information, which the
researcher finds practicable to collect as first hand information. Past data collected by
others, website of the company, brochures, Internet etc were the sources has been very
useful in data analysis.
The data collected from both primary and secondary sources have been used
productively by the researcher for data analysis, which in turn helped in bringing out
excellent results. Primary data are collected in five ways: observation, focus
groups, surveys, behavioral data and experiments.
Observational Research
Fresh can be gathered by observing relevant actors and settings
Focus Group Researcher
A focus group is gathering of 6 to 10 people who are invited to spend a few
hours with a skill moderator to discuss a product, service, organization or other
marketing entity. The moderator needs to objective, knowledgeable on the issue and
skilled in group dynamics.
Survey Research
Surveys .are best suited for descriptive research. ! Companies undertake
surveys to learn about people's knowledge, believes, preferences and satisfaction and
to measure these magnitudes in the general population.
Behavioral Data
Customer leave traces of their purchasing behavior in store scanning data,
catalog, purchase records, and customer database. Much can be learned by analyzing
this data. Customer's actual purchases reflect revealed preferences and often are more
reliable than statements they offer to market researchers.
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Experimental Research
The most scientifically valid research is experimental research. The purpose of
experimental research is to capture cause and affect relationship by eliminating
competing explanations of observed findings.
Type of study
Descriptive study has been adopted to collect the data from the Insurance
Agents to know their opinion about Bajaj allianz Standard Life Insurance. The study
was focused on understanding the market potential of Bajaj allianz Standard Life
Insurance Products and Services among Insurance Agents In Kollam City.
The sample size was hundred and the target of the population was Insurance Agents in
Kollam.
Research Approach
Survey was done in and around of Kollam city. The main places includes