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Selected Case

published: 21 Mar 2008

  • Topic: Leadership & Organisations
  • Industry: Insurance
  • Region: Global

Abstract:
This two-part case study describes the initial merger and cultural transformation of Aviva's Norwich Union (NUI) operation in the UK. It examines the complexities of integration that arose following a series of mergers that created NUI from 1998 to 2000. Case A describes how, after CGU Plc and Norwich Union joined forces to become NUI, top management's priority was to restore profits. Behind the scenes, however, the need for a whole new corporate culture was becoming increasingly imperative. It shows the tension between the need for immediate gains in efficiencies vs. longer-term approaches to the business that required careful nurturing and attention. It ends as the executive team's announcement of the new corporate philosophy - "to be a service provider with insurance at our core and care at our heart" - is greeted with complete disbelief by employees. Case B describes the actions taken to overcome their skepticism and successfully implement the new philosophy - actions that required significant change to the organisational culture.

Pedagogical Objectives:
This case does two things. First, it shows how easy it is for strategy and culture to come apart. In a permanent quest for strategic advantage, top executives seek ways to improve the positioning of the firm in the marketplace, often making major and seemingly sudden decisions on how the firm will play the game against competitors. Once they identify a direction, they expect the change yesterday. If the company culture is important to realising these strategic ends but is not moving in the same direction or is being asked to move too often, misalignment can occur. The second objective - how to go about realigning the culture with the strategy - follows the steps taken by this large organisation in trying to ensure the people and systems support the strategy.

Keywords:
Organisational Behaviour, Culture Change, Corporate Transformation, Leadership, Insurance, Merger, Corporate Governance, Value Creation, Strategy and Implementation

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