Assicurazioni Generali S.p.A

Assicurazioni Generali S.p.A hereinafter referred as Generali is a global company that provides insurance and financial products (Bloomberg, 2010). The company offers life insurance products – individual and group pension schemes – as well as insurance products for automobile third party liability, personal injuries, industrial plants and family protection; in addition it also offers financial and asset management services (Bloomberg, 2010). It has a global presence and offer the aforementioned products in Italy, Germany, France, Spain, Austria, Switzerland, Europe, Israel, China and India (Generali Group, 2010). The following is a SWOT analysis of the said company.

Strengths

            First and foremost Generali is a global brand, its relative size is already a major source of strength because it can easily generate revenue from many income streams. The company emphasized that from the outset it has a strong international outlook and now has consolidated its position in significant markets in Europe as well as Israel and Argentina (Generali Group, 2010). As proof of its success it was named one of the top ten global insurance companies in 2009 (Hunkar, 2009). It is the biggest Life insurer in Continental Europe and thrives using the strategy of multi-brand and multi-local approach (Generali Group, 2010). One can argue that this company is inching towards the number one spot by expanding more into the international market and by offering more products and services to clients and potential clients.

In Fortune’s Global 500 list, the annual ranking of the world’s largest corporations, the company leapfrogged from a previous rank of #47 to #19 because it purchased insurance companies in Germany and Spain, inked an investment deal with a major Italian bank and set up an asset management company in Luxembourg and even expanded overseas by opening an office in Vietnam (CNNMoney.com, 2010). In a nutshell this is the strength of Generali.

Weakness

            Its strength can also be considered its weakness. Every company aspires to be the biggest in their respective industry but size carries with it inherent risks and problems such as the difficulty to achieve efficiency when it comes to managing large resources not to mention assets and human resources that are scattered all over the world. It is a clear lesson of history that leaders struggle to control a vast empire especially when the boundaries of that empire have been stretched far and wide.

            Another major weakness of Generali can be simply understood by looking at the core nature of the insurance industry. There are no real products to speak of. It is an industry seen to wobble in recent years due to global financial crisis and also because insurance companies are highly dependent on the success of other business organization, especially those they chose to invest the money of their customers into.

Opportunities

            As mentioned earlier the company was catapulted to the top twenty of the world biggest and most profitable company because of consolidation and by opening an office in Vietnam. This country is considered an emerging market and Generali can even increase its profitability, as well as global presence by continuing with this trend. Based on their vision and mission statement, Generali indeed will push forward with this initiative and one can expect more offices to open in Asia. It is also poised to make more money when it comes to life insurance sales according to a recent report, as recessionary pressures is seen to be easing and things are expected to become better not worse (Reuters, 2010).

Threats

            The after shocks of the global financial crisis are still being felt in all sectors of finance, especially in the insurance industry. Although there are positive signs that the recession will be over sooner than expected, Generali, just like others who rely on investment opportunities and gains from investment opportunities, the catastrophic failure of established banks and financial institutions can still bring fear to the hearts of even the most seasoned investor.

An example of this problem is the perceived weakness of Generali because of the Greek debt crisis and as a result its stock underperformed by as much as 15% in this fiscal year (CNNMoney.com, 2010). Greece has struggled with debt payments for the last ten years (Wearden, 2010). And now its financial problems are affecting Europe as well and therefore Generali.

Conclusion

            Overall the company is stable and even ready to increase its value in the coming years. Its size is its number one strength although it can also be seen as a weakness if the company is unable to deal with the challenges that comes with globalization and difficulty of managing diverse assets and human resources scattered all over the globe. But its opportunities are unlimited especially when it comes to emerging markets particularly those that are found in Asia and other parts of Europe. Nevertheless, the company has to continue to watch out for the after effects of the global financial crisis. It has to be vigilant and maintain sound accounting practices as well as the need to review their investment strategies. The great number of established and once mighty corporation and financial institutions that fell by the way side is a grim reminder that a global economy is not something to be trifled with.

Works Cited

Bloomberg. “Assicurazioni Generali.” Accessed 05 August 2010. Available from

            http://investing.businessweek.com/research/stocks/snapshot/snapshot_article.asp?ticker=

G:IM

CNNMoney.com. “Assicurazioni Generali.” Accessed 05 August 2010. Available from

            http://money.cnn.com/magazines/fortune/global500/2010/snapshots/7676.html

Generali Group. “Generali Group Worldwide.” Accessed 06 August 2010. Available from

            http://www.generali.com./Generali-Group/About-us/the-Group/

Hunkar, David. “Top Ten Global Insurance Companies.” Accessed 05 August 2010. Available

from http://seekingalpha.com/article/172078-top-ten-global-insurance-companies

Reuters. “Update 1-Generali H1 up, boosted by life, sees FY rise.” Accessed 05 August 2010.

Available from http://www.reuters.com/article/

idUKLDE67318J20100805?type=companyNews

Wearden, Graeme. “Greece Debt Crisis: Timeline.” Guardian UK. Accessed 05 August 2010.

Available from http://www.guardian.co.uk/business/2010/may/05/greece-debt-crisis-

timeline