Strategic Analysis of NIB: Porter's Five Forces & Strategies

This report provides a strategic analysis of NIB Australia, examining its position in the market and the strategies it employs. The analysis begins with an introduction to NIB and its growth, followed by a Porter's Five Forces analysis to understand the competitive landscape. The report then delves into the company's functional, business, and corporate level strategies, highlighting how NIB builds competitive advantages through promotions, HR processes, cost leadership, differentiation, and expansion. The Mintzberg's 5 Ps of strategy are also discussed, examining NIB's plan, pattern, position, ploy, and perspective. Finally, the report concludes with recommendations for NIB to maintain and enhance its strategic capabilities, including global expansion, sector-wise performance evaluation, restructuring, and building superior value. References to academic sources support the analysis.

Strategic management
NIB

Introduction
• Strategies support an organization in continuing with the capabilities of the same
while operating in different global markets (Foss & Hallberg, 2014)
• The evaluation of the market competition and the offerings that are made by the
organizations support in identifying the loopholes and thereby design strategies for
improvements in the line of offerings
• One of the major examples of this is growth of NIB in the Australian region, which is
one of the fastest growing health funds in the country and one of the top 200
largest stocks in the Australian security exchange
• NIB is following an effective bunch of corporate and business level strategies that
are helping in staying ahead in the competition (Lokuwaduge & Heenetigala, 2017)

Porter five forces analysis
Threat of new entrants
• Larger investments are not affordable by the start up firms, which has
constrained the growth of the startup firms in the Australian economy
• The presence of large insurance companies hold little scope for the growth
of new entrants in the markets (Bruton et al., 2015)
Bargaining power of the buyers
• Brokers and distributors of the concerned organization have more power
over the service and product offerings of NIB
• End users have little or no influence on the organizational operations which
supported the venture in continuing with the effectiveness of the operations

Porter five forces analysis
Bargaining power of the suppliers
• The suppliers like the reinsurers and the financial organizations have a better
control over the costs that might be incurred by the concerned venture
Threat of substitutes
• Few substitutes of the concerned venture’s offerings are present in the market
Rivalry among the existing companies
• There is a high competition in the market through the existence of a fair
number of insurance companies
• The competitors of the concerned venture provide similar amenities and
financial services to the clients

Building competitive advantages
through functional level strategy
Promotions
• The concerned venture has taken steps to develop a range of promotional strategies through the utilization of
different social media platforms (Nib.com.au., 2019)
• The delineation of the policies and new offerings through the social media platforms like Facebook and Twitter
supported the venture in maximizing the rate of awareness among the existing clients while drawing the
attention of the new customers towards the propositions made by the venture
HR processes
• The concerned venture has taken steps to develop positive working environment, which supported the same in
inducing the collaborative culture among the workforce
• The transparency of the operations in the organization supported the same in retaining employee satisfaction
• The transparency of the operations in the venture supported the same in continuing with the operations in
observance to the requirements of the business in gaining a competitive edge
Clarity of the organizational processes
• Transparency in the process designs supported the employees in facilitating the uninterrupted flow of activities
with the aim of achieving the competitive edge for the venture

Building competitive advantages
through business level strategy
Cost leadership
• The concerned organization aimed at continuing with a cost leadership structure with
the aim of continuing with the effectiveness of the unique propositions
• The cost leadership based structure of the organization supported the venture in
continuing with the propositions in continuing with the effectiveness of the operations
in observance to the demand of the customers (Bergh et al., 2014)
Differentiation strategy
• Currently, the concerned venture is taking steps to develop the differentiation strategy
with the aim of sticking on to the uniqueness of the products and services
• The unique range of products and services has supported the concerned organization
in gaining a competitive benefit in a market was the competitors provided similar
propositions of the clients

Building competitive advantages
through corporate level strategy
Growth and expansion
• The concerned organization has taken steps to expand the venture in the
different regions of Australia
• The growth and expansion of the organization supported the same in
enhancing the rate of profitability
Renewal and stability
• The renewal and stability of the organization is based on the feedbacks
that are gathered by the same from the community stakeholders
• The feedbacks supported the venture in sticking on to the effectiveness of
the operations in observance to the demand of the customers

Mintzberg 5 Ps of strategy

Mintzberg 5 Ps of strategy
Plan
• NIB perceives strategies as a plan and also believes that most of the published strategy documents by the insurance company are deemed as plans
• The insurance company has stated plan for its future years that will ensure constant profitability as a universal financial service provider by avoiding
being broken up
Pattern
• Pattern in NIB Australia acts as the post hoc realization which is often explained by strategy analysts of the instance organization
• NIB considers purchasing start-ups that might have initiated as the semi-random acquisitions to attain useful patents
Position
• NIB makes strategic attempts to position itself in the insurance sector
• Over the year NIB Australia has attained better understanding of the needs of a broad range of businesses from the sole traders to the large
privately owned companies that facilitates in dealing with fierce competition in the sector
Ploy
• This strategy implementation technique facilitates in dealing with complex business aspects faced by NIB
• For instance, the insurance company claims that through decreasing its tax liability within a specific nation it can employ more people and
considering same the government also seeks to close the loopholes related with tax
Perspectives
• In following the perspective view, NIB Australia views that a strategy can be a manner in which it can view the world. Service along with this certain
other factors can shape the ways in which strategies are developed and implemented in NIB Australia

Strategies for continuing with new
capabilities
• NIB must develop its strategic capability of rapid global expansion strategy
• NIB is also recommended to carry out sector-wise performance evaluation
• NIB must consider continuing with its new strategic capability of
restructuring in which it can consider suspension of its new business sales
of all its direct instance products but it will continue to service and renew
it’s in force insurance policies
• The financial institution must to build a capability of continuing with
superior value in the market through creating a source of advantage in its
financial abilities that can enhance its peer performance

References
Bergh, D. D., Connelly, B. L., Ketchen Jr, D. J., & Shannon, L. M. (2014). Signalling theory and
equilibrium in strategic management research: An assessment and a research agenda. Journal of
Management Studies, 51(8), 1334-1360.
Bruton, G., Khavul, S., Siegel, D., & Wright, M. (2015). New financial alternatives in seeding
entrepreneurship: Microfinance, crowdfunding, and peer to peer innovations. ‐ ‐ Entrepreneurship
Theory and Practice, 39(1), 9-26.
Foss, N. J., & Hallberg, N. L. (2014). How symmetrical assumptions advance strategic management
research. Strategic Management Journal, 35(6), 903-913.
Lokuwaduge, C. S. D. S., & Heenetigala, K. (2017). Integrating environmental, social and governance
(ESG) disclosure for a sustainable development: An Australian study. Business Strategy and the
Environment, 26(4), 438-450.
Nib.com.au. (2019). Health Insurance & Private Health Cover Australia | nib. Retrieved from
https://www.nib.com.au/