Signature Assignment: Strategic Plan: Implementation Plan, Strategic Controls, and Contingency Plan Analysis

Strategic Objectives

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Background

The strategic objectives for the new division are based on the balanced scorecard format. The four quadrants of the balanced scorecard that have been taken into consideration during the formulation of the strategic objectives include the financial perspective, customer value perspective, internal operations perspective, and learning and growth perspective. Each of the four quadrants was key in formulating the twelve objectives, with each section enhancing the formulation of three key objectives of the new division. Additionally, each strategic objective is either based on the assumptions, trends, and risks associated with the click and motor business model and the finance industry about the opportunities and issues exhibited by the new division. Furthermore, the strategic objectives are based on the mission, value, and vision of the company and have a metric and target.

Financial Perspective

The first strategic objective for USAA’s new division will be to improve the profitability of the company by 10 percent annually through the use of technology. The new division will implement the click and motor business model, and one of the major trends associated with it is the capability of E-commerce in driving profitability. Through E-commerce, the new division should be able to grow its transaction and user base by helping it cut unprofitable product lines, rationalize capacity, and converting capital expenditure to operating expenditure, thereby, driving profitability. Income and revenue statement will be used to measure profitability for the annual operation for the next three years. A yearly increase of 10 percent is the target set.

Increasing the market share of the company through mitigating market risks is another strategic objective for the company. Market risks such as losses caused by movements in the market prices of the commodities, financial derivatives, and securities are common challenges in the financial industry. The new division would implement risk-based and innovative empowerment regulations to encourage the right risk culture that would assist in mitigating risks associated with the financial industry. Percentage increase in the market share by five percent over the next year would be used as the metrics. It is targeted that the market share should grow by five percent annually for the next three years.

Another strategy for the new division is to increase its revenue by 15 percent annually by capturing a larger market of the military personnel and its family. One of the assumptions associated with the financial sector and the click and the use of click and motor model is that the poor have the same needs as both the middle and lower classes. The click and motor business model of the new division will hope to capture the lower, middle, upper classes of the military personnel. The annual recurring bills are the metrics that would be used in measuring revenue growth of the new division. It is expected that the revenues would grow by 15 percent annually for the next three years.

Customer Value

One customer perspective strategic objective for the new division is retaining customers by meeting their technology needs. One of the trends associated with the click and motor business is making digital tools the mainstreams of the business’s operation while incorporating offline activities. The new division intends to meet the technology needs of its consumers through adapting online transactions and customer services. Customer Churn Rate (CCR) would be used to measure the percentage of customers that would have been lost annually for the next three years. The target of the new division is to ensure that no customers are lost for the next three years.

Another strategic objective is achieving customer satisfaction through applying customer intelligence to prevent operational risks when dealing with customers. Operational risks such as human and processing risks can lead to the loss of customer due to human errors and improper information processing. Understanding the values of the customers will be key to achieving customer satisfaction. The new division will apply technology to help it access customer data to specify what exactly they want and expect from the company. Churn would be used to measure the level of customer satisfaction annually, which will involve analyzing the canceled subscriptions. The target is to ensure that the number of canceled subscription by customers to reduce by 20 percent annually for the next three years.

Improving the service approach for new and existing consumers to indicate high levels of customer value is another strategic goal for the new division. Customers need to feel valued for them to keep coming back to purchase the products of a company. One assumption that underpins the new division’s business model and industry is that the current product portfolio will match all the needs. The new division will need to take into consideration both personal and technological needs of the consumers. The click and motor business model will play a critical part in ensuring that the objective is met. Product innovation will help the new division ensure that its products and services offered to meet the highest levels of expectation of the consumers. Cost of customer acquisition is the metrics that would be used to calculate the customers’ value to the new division for the next three years. The target set forth is to ensure there is an increase of two percent in the acquisition of products and services by the loyal customers for the next three years.

Internal Operation Perspective

Improving internal communication to encourage team-work and productivity improvement within the new division is one strategic process goal for the company. Insecurity concerns such as cyber fraud is a common trend in the financial industry. There would be a need to communicate to the staff regarding such trends and encourage teamwork when suspicious of such incidents. Today, cybercriminals are stealing customers’ information and using them for their benefits. Employees need to be informed about such tricks, which can be achieved through internal communication enhancement. Total workforce for the employees is the metrics that would be used in measuring the overall productivity of the new division annually. It is expected that the productivity of the new division to improve by 25 percent annually for the next three years of its operation.

Reduction of error rates through considering talent and areas of specialization of employees when allocating duties to increase employee performance is another process strategic objective. Efficiency would be key in ensuring that the reputation of the original company and the new division is maintained. One of the common risks associated with the financial industry and the brick and motor business model is reputation damages. Small operation errors and unethical practices are the primary reasons why industries damage their reputation in the financial industry. Reducing errors in operations will be key in ensuring that the new division maintains its reputation and that of the original company. The level of innovative thinking of the organization will be the metrics that would be used to measure the employee performance of the new division. Since the division aims at encouraging an innovative culture and reducing errors, innovation measures will be vital. The level of innovative thinking is expected to improve by five percent annually for the next three years.

Streamlining the core business processes to help change embracement in the new division is another strategic objective of the company. One assumption that applies to all markets in the business world is that change is inevitable. Streamlining the core processes of the new division will help the employees easily identify the procedures and regulations required to be followed in the workplace as they conduct their duties. Additionally, it would be easy for them to identify, understand, and embrace change easily in the organization when the need arises. Individual employee assessment would be carried out annually to measure the change process of the employees during the year. Employees need to show an improvement in embracing change for the next three years.

Learning and Growth Perspective

Improving technical and analytical skills through technology embracement to increase the level of organizational capability is a learning and growth strategic objective for the new division. Systematic risks are one of the major risks associated with the finance and the click and motor business model. Systematic risks refer to those risks that affect the entire industry as a result of the implementation of a particular business model. There would be a need to equip the employees with technical innovations present in the financial industry and computers to enhance the employees’ technical and analytical skills.

Improving employee satisfaction through training and offering an attractive compensation package for employees performing exceptionally is another strategic objective for the new division. The assumption underpinning the strategic objective outlined is assessing feasibility through the cost of service. To motivate employees to retain their high levels of productivity there would be a need to show them their value to the new division. The cost of service to the customer needs to be in line with the pay that the employees would be receiving. Being a customer-centric division, customer satisfaction is vital. Rewarding employees based on how well they perform their duties and handle customers will motivate others to embrace the same attitude.

Investing in innovative tools that improve the productivity of employees to encourage a technological innovation culture is another learning and growth strategy goal for the new division. A trend associated with the click and motor business model and the finance industry is advances in robotics and Artificial Intelligence (AI). An innovative culture can only be encouraged in the workplace by the new division investing in such tools to enhance an innovative culture in the company.

Communication Plan

The purpose of the new division’s strategic objectives is to provide a framework on what it hopes to achieve at the end of the first year of its operations. The objectives were formulated based on the mission, vision, and values of the company to provide a clear picture on the annual expectation for the company. The audiences of the strategic objectives outlined are the shareholders, employees, management, and consumers of the new division. Additionally, the USAA as the original company is another target audience since its support to ensure the success of the new division is needed. The strategic objectives give an overview of what they should expect from the new division and what the company expects from them. There would need to raise awareness about the strategic objectives for the new division and communication will be fundamental to ensuring that the message is received by the audience. The communication channels that will be used in communicating the strategic objectives include emails, newsletter, websites, and Social Media. The chosen channels seem effective in delivering the message to the specified audiences.

Balanced Scorecard

	Key Trends	Risks	Assumption	Strategic Plans
Financial Perspective	E-commerce and Profitability	Market Risks such as liquidity and financial derivatives.	The lower, middle, and upper classes have the same needs.	Improve profitability through e-commerce. Increasing market share by mitigating risks. Increase revenue by capturing a larger customer base.
Customer Value Perspective	Making digital tools as the mainstreams of the business operations.	Operational risks such as human and operating risks.	Product portfolio matches all the needs of the consumer.	Retaining customers through meeting their technology demands. Achieving customer satisfaction through using customer intelligence. Service approach improvement for both new and existing customers.
Internal Operation Perspective	Insecurity concerns such as cyber fraud.	Reputation damage due to factors such as common errors and moral hazards.	Change is inevitable due to technology changes, laws, and policies.	Internal communication improvement and team-work encouragement. Reduction of error rates. Core business processes streamlining.
Learning and Growth Perspective	Robotics and Artificial Intelligence.	Systematic risks such as market fluctuation and change in the exchange rate in currency.	Assessing feasibility cost through cost of service.	Improving the technical and analytical skills of employees. Employee improvement satisfaction. Investing in innovative tools to encourage an innovative culture.