Axa - Ppt Format

7/30/2019 Axa - Ppt Format

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INTRODUCTION

1816 - French based Company started by Jacques- Theodore leCarpentier and 17 other entrepreneurs.

Started as Mutuelle Contre de lAssurance Contre IIncendie(MCI).

1847 - MCI decided to diversify its activies. So they created two

companies Mutualite Immobiliere & Mutalite Mobiliere. 1881 Both companies merged to form Ancienne Mutuelle

(AM).

1922 AM offered automobile insurance under then name of

AM Accidents. 1946 Companys 1st merger AM du Calvados.

1972 & 1974 Death of Andre Sahut dlzam & strike hit AM.


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1978 Remnamed the company to Mutueles Unies (MU). At thesame time accquired Compagnie Parisienne de Garan tie.

1982 MU took over Drouot Group and Bebear was appointedas Chairman and CEO of merged entity named Mutuelles UiesDrouot (MUD). Became the largest non state owned insurer inFrance.

1985 MUD changed its to AXA.

1986 AXA acquired Le Providence & Le Sccours.

1988 AXA & Compagnie du Midi merged their insurancebusiness. They got listed in Paris Stock Exchange.

1989 AXA acquired controlling equity stake in Compagnie duMidi and became 2nd largest player in French Insurance market.

Companys revenue grew from 1.4 billion Euros to 7.3 billionEuros. They had 42 subsidiaries across the world.


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1991 They formulated a vision of becoming a global company.

Revenue was 8.1 billion Euros with France accounting 60% and

Rest of Europe with 30%.

They acquired majority stake in US based Equitable Assurance(EA was the 3rd largest insurer in US).

AXA invested USD 1 billion in the acquisition as they also

acquired the subsidiaries Donaldson, Lufkin and Jenrette.

1994 AXA acquired Boreal Assurances for USD 120 million. Itbecame the 4th largest insurer in Canada.

1994 They acquired Victoire Belgium. AXA Management

services was incorporated in Europe.


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1995 AXA acquired 40% stake in National Mutual Life

Association of Australia for USD 840 million (2nd largest inAustralia), New Zealand and Hong Kong).

1996 Listed in New York Stock Exchange (NYSE).

They announced a merger with UAP. It made AXA, 2nd largest

insurer in the world. UAP was taken over by AXA for USD 9 billion stock swap.

1999 AXA acquired Guardian Royal Exchange group for 1.5billion Euros. With this, AXA became 3rd in UK non-lifeinsurance market.

AXAs US Business was renamed as AXA Financial Inc.

They also formed an alliance with Nippon Dantai, 13th largestdomestic life insurer in Japan.


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2000 Bebear became the Chairman of ACA Group

Supervisory Board and Henri de Castries became the Chairman

of AXA Group Management Board. Constantly evaluated the business portfolio to divest from loss

making businesses and those did not fit in the objectives.

2000 AXA sold the majority owned investment-banking

subsidiary, Donaldson, Lufkin & Jenrette Inc. for USD 8 million. 2002 AXAs total revenues were at 74.7 billion Euros and net

income 949 million Euros.

They involved in several line of business ranging from Motor

insurance to property & casualty insurance. 2002 Life & savings segment accounted for 65% of total

premium. Property & Casualty segment for 21%. International

Insurance segment for 8%.


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AXA Board

To achieve the objective of becoming a global company, therewere several management issues like cultural, communication,legal, capital allocation and integrating people and processes.

They had to take care of statutory, regulatory, legal andaccounting & tax systems as they varied from country to country.

In order to reduce to complexity, they introduced a singlebusiness model of financial protection.

AXAs services included asset protection, life protection,investment savings, asset accumulation, retirement annuities and

estate planning. They focused on organic growth by retainingexisting customers and acquiring new ones.

2003 They planned to maintain a balance betweencentralization and decentralization to reduce complexity.


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Cylinders of Growth Priorities to

Achieve Operational Excellence

A differentiation factor which offered value

addition.Product Innovation

Offer best service at best price.Core Business

Expertise

Lessen administrative load and enhance sales

performance.

Distribution

Management

AXA Employees Champions of Operational

Excellence.

Quality of Service

Reduce operating cost & improve quality every year.Productivity


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Supervisory Board

Responsible for the management of AXA Board & accountable to

the shareholders.

Appointed by the Chairman & members of the management board.

Stock repurchase, acquisitions of companies worth over 500 million

Euros, strategic partnership, dividend payment etc Required consent

of the board.

Met at least five times a year and discussed issues pertaining the

groups operation, stock report, strategies etc.

Company shares were provided to the board which was equal to the

annual fees of the directors.Four special purpose committees were formed and members were

elected to handle these committees. Committees Audit, Finance,

Compensation & Selection and Governance.


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Management Board

Decision making body with its members dedicating their time to managing

the company.

Meetings were held weekly to discuss strategy and operations of the group.

Appointed by the supervisory board and they were to handle specific

functions.

10 Business units were created which was headed by a CEO. Executive

committee was created to review and execute AXAs strategy.

Business reviews were conducted by the Executive committee which

consisted of two parts Meetings between the management board and the

business unit members and meetings between the business unit members

and the supervisory board members.Business Support Development (BSD ) teams were created. They reported

to the management board on key projects being considered at the Business

Units.


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At HQ, functions which were centralized were the corporate

strategy, brand management, some key processes and standard

Key Performance Indicators (KPIs).

Capital allocation were centralized to minimize cost of capital

and ensure financial strength.

Risk management was also centralized.


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Key Performance Indicators

Customers

Market Share Net Cash Flows

Client Satisfaction

Employers

Scope resultemployees

Scope result agents

Shareholders

Combined ratio Present value of

future profits in life Life and savings

costs/income ratio

Stakeholders

Implementation ofAXA Way


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AXA Asia Centrally Managed

Functions

CorporateOffice

Financial Reporting

Corporate Planning& Development

Internal Audit

Business &Distribution

Retail Business

Health Business

Commercial

Business

Distribution &Marketing

RegionalManagement

ServiceActuarial

Claims

Finance

Human Resources

Process & IT

Reinsurance

Project Management

Communications


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Objectives of Procurement

Lower Costs The procurement team must contribute to cost reduction.

Support the Business

Procurement team has to negotiate for best prices and services.

Secure Delivery

The business must get what is has requested for : Procurement is alsoresponsible for implementation of the contract.

Develop sustainable and ethical relations with suppliers Maintain excellent relationship with the suppliers by adhering to a set of

clearly defined procurement guidelines and promoting ongoing dialogue.


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2004 Due to centralization of procurement, they were able to

save 100 million Euros.

2005 They had 115 regional and global contracts.

Savings due to centralized contracts Telecommunications25%

Office Supplies 15%

Professional Services 15%

Desktop systems 15%

Travel10%

Infrastructure on demand 10%

Software 5%


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Leverage AXAs global scale to reduce groups annual IT operations spending.Improve operational effectiveness.

Deliver consistent high quality service

Become business enabler.

AXA tech managed over 600 million Euros in IT budgets of the

group.

Since 2001, They were able to achieve annualized 160 millionEuros.

By 2007, they planned to expand scope of AXA tech to cover all

companies.


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AXA Efforts to Decentralize AXA implemented good corporate governance across the group.

All subsidiaries were governed by a board, which included non-executive directors. Audit committee oversaw the functioning.

All subsidiaries prepare 3 year forecasts. They have critical reviewto make the forecasts better.

Company believed that the employees are the most valuableassets and to achieve global standards, it has to motivate theemployees.

They encourage best practices to employees in professionalism,innovation, pragmatism, team spirit and integrity.

They provided equal opportunities in hiring, pay and promotionto all employees.

Subsidiaries have their own local strategies. These were necessarybecause local laws, practices and distribution models guidedinsurance companies.


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AXAs subsidiaries launched products that were in demand intheir local markets.

Products were designed to keep customers need in mind.

All subsidiaries were free to have their own distribution practices.

2003 AXA had a central risk management department with 50employees and local risk management departments with 200

employees. Focus of risk management department asset liability

management, profitability of the product, reserving policy &reinsurance strategy, information system & modernization andmanaging operational risks.

Risk management department submitted an annual report to thesupervisory board, management board and to the auditcommittee.


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AXA Strategic PlanStrategic Imperatives

Profitable new businessgrowth

Negative spreadmanagement

Increase customerretention

Manage our costs

Asset allocationmanagement

Improve our service levels

Be an employer of choice

Strategic Programs

Distribution

Products

Technical & InvestmentMargins

Customers service &Operational Efficiency

HR

InfrastructureEnhancements

Regulatory compliance &others

Key Performance

Indicators (KPIs)

New Business

Negative Spread Policies

Profitable Policy S&L rate

Economic Expenses Return on Investment

Customer Satisfaction

Employees Satisfaction


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They reaped several benefits by striking balance betweencentralization and decentralization.

They had firm control over some of the most importantactivities and were able to steer the subsidiaries towardsgrowth.

At the same time, the subsidiaries were free to carry outtheir day-to-day operations.

2004 Acquired Mutual of New York (MONY) for USD1.5 billion.

2005 They launched Ambition 2012, with the objectivefor becoming the most preferred company in the insuranceindustry.


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Axa - Ppt Format

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