Progressive+Case


 * Progressive Case**

__** Case Analysis Template **__
Reading: Innovation at Progressive (A): Pay-As-You-Go Insurance

Who: Robert McMillan, Progressive Corporation Executiv

Immediate Issue/Problem Being Faced: Should Progressive roll out the Autograph program nationally, pilot the program in a few other states, or not at all? Good.

Basic Issues -Progressive has been gaining market share and becoming a larger player in the industry due to their ability to utilize information to segment their prices. How will they continue to do this to become the market leader and surpass the three ahead of them? -State regulations. With what happened in California being a reality, they must be cognizant of it happening again in other states and resulting in major losses. They must also consider what each state will allow and not allow. -The cost of implementing this program nationally will be significant The case also says that it will take a lot of time.

Some in the company are concerned that Progressive is losing its focus.

Urgency/Importance: The industry is very fast moving and Autograph needs to be utilized before their first movers advantage is void Yes. So, is the issue urgent and/or important?

Decision Criteria: Time is an important critera. For the progressive, it is useful to finish steps in time. If they can not utilize information to segment prices in time, the information may be outdated so that they will lose control for the progressive. Good. The second one is the technology security. If the wirless can not connect information well and keep the privacy, there must be issues for Progressive. The third one is the cost. They need to control the cost to keep the innovation. They use the financial report to analyze, such as ROA and margin ratio.

Alternatives: 1.Roll out nationally 2.Roll out with smaller pilot projects prior to rolling out nationally. 3.Keep the program in Texas only.

Missing Information: There is no information about the weakness of the current system and no more information about the financial budget, and the map of pay as you go innovation. The information about market share of company and the competitors and the competitive of company is needed. This will help us to analyze the possible of alternatives.

Assessment of Alternatives - Roll out nationally Advantages: 1. Progressive will expand the market shares and open the global market. 2. It will increase the company's reputation in order to attract more customers. 3. It will attract more professional people to join the Progreesive and have more new ideas, so that the team for Progressive will be stronger. Disadvantages: 1. The cost is high for the national business. 2. It will hard to open the global market because different policy in different countries such as duty. 3. There is a risk for company that maybe the economy will refuse company to join.

- Roll out with smaller pilot projects prior to rolling out nationally. Advantages: 1. It will increase profit by the small changes and can invest global business in the future. 2. It will keep current customers and minimize the risks. 3. It will have more time to research and develop for the global innovation and find the approate place to expand the market. Disadvantages: 1. The similar small pilot projects will not encourage employees and teams to look for more new ideas. 2. It will cost long time to finish the innovation 3. It will take extra time for company to make familiar with new business. - .Keep the program in Texas only Advantages: 1.All business are familiar with company and employees. 2.It will save more time and money that will pay for other areas. 3.Company could have more time to focus on the Texas. Disadvantage: 1.The decrease of profit from other area. 2.Lost of customers come from other area. 3.There is a risk for company to put all in this one.

Selection of Preferred Alternative: 1+2.The magnitude of this project is massive if it were to be rolled out nationally.I believe that become a national product is very probably but Progressive must do so at a medium pace. Rolling out Autograph in key states would be my first move. I would choose large states that represent large democratic and republic populations. Getting their support first will allow you to enter into all of the other states with minimized barriers. After the pilot projects have launched and you have not only gained support on the political front, but acquired an even larger database for Autograph, you will be prepared to roll out nationally.

Assumptions: -Is there a FOIP issue with this type of information being used and possibly sold?

Action/Implementation Plan: Company should make a deep research about the market and the issues of company. Then they need make a plan with strategy about innovation.The CEO will set up the steering committee advisory to monitor the innovation and set up the plans. When the plans finished, they will design the pilot projects and improve the pay as you go system. When the pilot programs attract more customers and earn more profits, Progressive will invest into the global market to expand the shares.