Company profile (w/abstract and citation page) - Research Paper Example

Background information AIG can be traced to Cornelius Vander Starr, who established it in 1919 as an insurance agency operating in China. However, in 1949 because of communist regime, Starr moved to America and established his business in New York, where the company has expanded to over 130 countries making it the biggest company in the industry. The core business of the company is providing insurance polices, which include private vehicles, commercial vehicles and even motorcycles, it also provides travelers insurance (AIG Company).

American International Group Company (AIG) Mission statement Below is the mission statement of AIG Company. “As a global financial services organization, we have committed our resources to developing products and services that address the needs of our clients as well as promote a corporate culture that values integrity, diversity, innovation and excellence.” (AIG Company). American International Group Company (AIG) Vision statement To be the world's first-choice provider of insurance and financial services.

We will create unmatched value for our customers, colleagues, business partners and shareholders; as we contribute to the growth of sustainable, prosperous communities. (AIG Company). American International Group Company (AIG) Goals To meet its objective, AIG aims to focus on four main goals 1. Building AIG’s business value through improvement to its international property as well as strengthening its casualty and local life insurance operations 2. Repaying the government loans it received through divesting and selling suitable assets 3.

Lowering operating expenses by carrying out a comprehensive analysis of AIG’s expense structure 4. Reducing high risk by closing down AIG’s exposure to particular financial products as well as derivatives transactions (AIG Company). Strategy adopted by AIG Understanding the way external environment affects the industry will determine the level of competition as well as profitability of the industry. This offers the basis to identify opportunities brought by changing trends in the industry; companies need to formulate various business strategies to exploit these opportunities.

In view of the very unpredictable external environment of insurance industry and, AIG has adopted several strategies to remain aloft (The Wall Street Journal). One of these strategies is diversification. AIG has expanded into other businesses so as to increase it revenue from more competitive ventures. This strategy allows a company to have a distinctive leverage competence for it to improve it competitiveness. The objective of AIG’s diversification is to make to spread it risk and reduce it vulnerable to both economic and competitive threats.

In addition, diversification is meant to improve the fortunes of the company. The second strategy taken by AIG is international growth. America was the worst hit country by the financial crisis and there is high competition (AIG Company), thus, AIG has increased its international growth strategy by opening new branches in foreign countries to gain new customers, and reduce risks. Entering new markets by AIG enables it to dominate markets that are under-exploited such as African, Asia and Balkan countries.

There is a high chance for AIG to succeed if it’