Allstate Insurance Company

Professor Wendy Johnson
October 30, 2011

Allstate’s Goal-Setting Process
Allstate Insurance was founded in 1931 as a part of the Sears Roebuck and Company and was spun off as a separate company in 1993 with 20 percent of the company being offered to the public. In 1995, the remaining 80 percent of the company was again offered to the public and has been its own separate entity since then. Allstate has been a leader in the industry as one of the America’s Most Admired Companies as told by Fortune Magazine in 2007 and 2009. Allstate has also been a leader in the fields of Work/Life Initiatives, Diversity Education, Accountability Measurements, Mentoring Programs, as well as Career Advancement and Development Leadership. While being a leader in these areas, Allstate has been able to retain some of the best managers and leaders at their company and excel in an industry that is very competitive and demanding on each and every person that they employ. One key aspect of Goal Setting, not only for Allstate, but for almost every sustainable business is giving employees the knowledge and ability to attain their goals and also to give those employees the tools that are necessary to carry that goal out. Through the company’s employee development process, all employees receive an assessment of their current job skills and a road map for developing the critical skill necessary for development. This gives all employee a way to set goals that are aligned with the expectations of Allstate and gives them the training that is needed to move up in the company and achieve their goals that are attainable that not impossible to obtain. One of the ways that Allstate provides its employees with the knowledge and tools to carry out their jobs is with the Diversity Index and QLMS (Quarterly Leadership Measurement System). Allstate realized that having diverse employees and a diverse work environment would allow them to take advantage of the differences in today’s work environment and allow employees and the company as a whole to achieve their goals. This survey gives the employees the ability to let top managers know that 1)To what extent does the company deliver quality service to customers regardless of their ethnic background, gender, age and so on, 2)To what extent is the employee treated with dignity and respect, 3) How often do you observe insensitive behavior at work, for example, jokes about ethnic background, gender and age and 4) To what extent do you work in an environment of trust where employees/agents are free to offer different opinions. To link compensation to the company’s diversity goals, 25 percent of each manager’s merit pay is based on the Diversity Index and QLMS. I believe that this is a very effective goal setting process for employees of Allstate because it gives the employees a way to have their voices heard about ways to improve the company through its diversity programs and gives managers the initiative to make an impact in their communities by not excluding people to do business with Allstate because of their background.
Competitive Advantage with development of Diversity Index
The Competitive Advantage that Allstate has is with the Diversity Index can be seen with the levels of minorities and women that continue to work for Allstate. Allstate has received the awards for “1998 Top Companies for Minority Managers”, “1999 Best Companies for Hispanics to Work”, and “1997 Best Companies for Working Mothers”. With the focus on QLMS and the Diversity Index, Allstate is the No. 1 life and automobile insurer among African Americans, and the No. 1 homeowner and life insurance firm among Hispanic Americans (Management Review). The advantage also gives Allstate the lead among other top insurers because the dynamic is to accept people for who they are and to put insurance agents in demographic areas that fit the needs of the people in those areas, focusing on cultural, age and racial backgrounds in that process of selection. Allstate’s ultimate goal is to obtain and to retain the best employees. Allstate has been a leader of diversity since the 1960’s, when it wasn’t necessarily the best route to go, by training and educating their employees about the advantages of diversity in the workplace and the personal developmental opportunities that it provides. Allstate reaches out to historically black colleges for recruitment and focuses also focuses on colleges and universities in Puerto Rico because they aspire to expand its Hispanic customer base. The competitive advantage is seen in the type of people that they employ and the fact that they are the No.2 insurer in the United States with Revenue of 31.4 billion and a Profit of 928 million for 2010.
Recommendations for high-performance reward systems to motivate employees
I believe that the Diversity Index and QLMS are very good ways to allow employees to achieve their goals, while at the same time treating people with dignity and respect, but intrinsic rewards are some of the best ways to motivate employees to go the extra mile. I would offer the employees incentives for obtaining skills that are not a direct obligation of their positions. Allowing some lower level employees the training and educational opportunities to become an agent would be a good way to retain top performers. I would offer the employees in a region that has the best growth profit sharing awards, and flexible benefits. This gives the employees even more incentive to perform better than the competition in their regions and would promote the Diversity Index and QLMS even more because employees and agents would do more to offer insurance and other services to people in their respective areas that they otherwise would probably not receive. I would give employees financial rewards and the ability to receive those rewards in a timely manner, and in a way that is equitable for everyone, not just managers as a result of doing well on the Diversity Index. Each region of the United States with the highest results of the surveys and the ones that does the best financially would have a big convention that would bring together everyone in that area to receive a plaque for their good services and give agents and others in their area the chance to be recognized by everyone throughout Allstate, and eventually this would give people the desire to strive more so that they could be recognized as a leader of the industry. By offering these other incentives, this would give employees the motivation to not disassociate or discriminate against people of different backgrounds because they are motivated by financial rewards and benefits that would make their Diversity Index go up .
Would I be motivated by the Diversity Index and QLMS
I believe that I would absolutely be motivated by the Diversity Index and QLMS, because I realize in today’s work environment and economy that everybody can have an impact on my life because of the different perspectives and situations that they may be in. I would take it very seriously to treat each of my co-workers and customers with the utmost respect and dignity because people from different cultures, backgrounds and religions are the driving force behind growth in the United States and beyond. There are many ideas that these people can give that could allow me to think outside the box and go into areas that are not necessarily the most prosperous in the U.S. There are people from other countries and environments that is changing the way that everybody is doing business and to discriminate against anyone in today’s society is not only bad for business, but is just plain wrong.

References:
(Hellriegel, D., & Slocum, J. W., Jr. Organizational Behavior: 2011 13th edition.)
(Wah, Louisa. (July/August 1999) Diversity at Allstate: A Competitive Weapon. Management Review)
(Allstate Insurance. Wikipedia. Retrieved Oct. 27,2011 from http://en.wikipedia.org/wiki/Allstate)
(Allstate Insurance. Allstate.com Retrieved Oct. 28, 2011 retrieved from http://www.allstate.com/careers/diversity.aspx)