It is important to emphasize that Allstate does not just award supply contracts

It is important to emphasize that allstate does not

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provide more value to Allstate and its customers. It is important to emphasize that Allstate does not just award supply contracts to business owned by those identified in the supplier diversity program. While 100 participants took part in this program in 2008, just over half diverse suppliers were eventually awarded contracts (Allstate, 2008). Thus, it may be claimed that supporting supplier diversity is really a differentiating characteristic of the Allstate Corporation. The only reason this practice would be considered a weakness is if the program awards contracts to diverse suppliers and exclude suppliers that have the potential to add value to Allstate and its customers. Dependence on the Auto Insurance Sector. As previously stated, the Allstate Corporation was established at first as an auto insurer. During its long history, the company had been launching new products to expand into new markets. To date, the auto insurance product line provides the most revenue for Allstate. For example, if we make a look at the table of top 10 insurances companies in the U.S. life insurance sector, Allstate will be not listed there. At the same time, some other companies like the American International Group simultaneously successfully operate in the fields of property & casualty insurance and life insurance (Insurance Information Institute, 2014). Thus, it may be claimed that company’s dependence on the auto
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ALLSTATE INSURANCE CORPORATION CASE ANALYSIS 47 insurance sector may be positioned as a weakness because it makes the company vulnerable to systematic risks. Risks previously established such as dropping oil & gas prices have negatively influenced Allstate’s revenues through an increase in the number of car accidents in the third quarter of 2015. Although company’s diversification efforts have recently expanded the range of products, Allstate still remains to be primarily known as an insurer in property/casualty sector, especially in the auto insurance sector. Recommendations SWOT-analysis of the Allstate Insurance Corporation indicates that the company is now going through a complicated stage of its growth. Stagnation of financials is accompanied by an absence of innovative managerial ideas. Besides, outdated technologies and downward brand value threaten to result in the fall of revenues in the nearest future. It is well-known that the company has already lost its position as the second largest auto insurer in the United States to GEICO Corporation. In the case of Allstate Insurance Corporation, it is obvious that leadership engagement in planning, implementing and executing necessary change efforts to promote growth. First of all, it is required to address the problem of company’s image and reputation. The brand value, which is traditionally considered as a significant strength of the corporation, is gradually decreasing. In order to reclaim Allstate’s brand value, it is not enough to use celebrities’ endorsements in standard advertising. I would suggest that it would be effective to allocate additional funding or focus to the sponsorship of sports, charitable programs and other social projects organized by the government or non-governmental organizations.
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  • Fall '18
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