Capital market and competition benchmarking for a financial institution
STARTING SITUATION – NO COMPANY CAN AFFORD TO FLY BLIND
The controlling of an international insurance company could not be structured efficiently because of a lack of clarity regarding the company’s own standing. A lack of knowledge about the competitive environment, capital market expectations and future developments in the industry made it difficult to set goals that were suitable to the market.
PROJECT APPROACH – UNDERSTANDING THE MARKET IN ORDER TO MAKE COMPARISONS
Using external databases and analyst reports, forward-looking KPIs were developed, which were supplemented with internal performance parameters. As well as economic relevance, the main criteria were availability and comparability of the fundamental data. With this aim, a peer benchmarking exercise was performed, and the results were used as a basis for determining the company’s medium-term target positioning. By standardizing the benchmarking and incorporating it onto an annual control process, the foundation was laid for a permanent, up-to-date, comprehensive view of the constantly changing market environment, and of the company’s own positioning.
FINDING – THE MARKET ENVIRONMENT PROVIDES INDISPENSABLE CONTROL INFORMATION
The efficient controlling of a company requires ongoing and differentiated analysis of its top competitors. When defining control parameters, nearly all industries have their “usual suspects,” i.e. typical key data with which management is generally familiar. However, being subjected to a brutally honest and systematic comparison with other market players results in a realistic external perspective, and enables companies to take a look at their own habitual mindset. Only those who dare to measure themselves against the best will enjoy long-term success in the market.
- Target market positioning determined on the basis of forward-looking KPIs.
- Forward-looking KPIs developed and supplemented with internal performance parameters.
- New target positioning established with reference to the industry leaders, in order to achieve the goal of being “best in class” in the medium term.