Participating_in_the_Dynamic_Business_Environment

Participating in the Dynamic Business Environment Transamerica Ltd. Transamerica is a global organisation incorporated in the AEGON Corporation. Transamerica covers reinsurance market in USA, Asia and pacific, Europe and South America. Transamerica has seen a steady growth on its European markets and has been afloat in the US and South American markets. The prospect of growth looks promising in Hong Kong, Taiwan and newly opened office in South Korea. The operation in Dublin (Transamerica International Reinsurance Ireland Ltd) has been always effective and profitable. Even during 2008/2009 the office stayed profitable thanks to the low corporate tax and the direct business link to offices on bigger markets in France and Spain where the cooperation has always been close and profitable. What the operation in Ireland regards as the most important fro business point of view is to be able to read the dynamic business environment and act accordingly to understand the business specifics, manage its operation appropriately and expand its portfolio and interest to cover larger area of the reinsurance market. This assessment will present the analysis of the Transamerica operation in Ireland. It will also look at the business opportunities that the Irish environment offers and it will give recommendations for the business’s expansion and advancement. This is done through the PEST analysis. Political factors have a great affect on the economic activities of businesses in any country. Ireland enjoyed a steady increase in business development and capital growth thanks to the business orientated government. The political will in Ireland introduced in the 1980s social partnership, where state agencies, private businesses and local communities designed a plan and agreements on how to attract international businesses and also help domestic businesses to develop and expand. This has been a favourable time for Transamerica Ireland as thanks to the business supportive government the company was able to quickly establish itself and start generate income. Although the insurance business has already had long history here, the reinsurance product wasn’t very common. Thanks to this fact the Transamerica business started to flourish here and soon it managed to integrate itself into the global Transamerica family. The Irish story reflects a complex interaction of domestic and international factors. European integration has transformed Ireland’s relation to its international environment and social partnership has transformed its internal ability to mediate interests and adhere to coherent strategies. (O’Donnell 1998) Economical factors have been shaped and defined in Ireland towards the end of 1980s after the failure of Irish economy adapting to the European model of international business. The public private partnership had come up with sets of three three year plans for boosting up the economy, attracting foreign investments, while making the unions and employees going along with these changes under the agreement on preserving appropriate salary and prospect of getting more people employed with development in working relations and benefits. Thanks to the business orientated government crucial economical changes were introduced, as the low corporate tax, which helped to attract the right investors and foreign funding. Especially the low corporate tax gave a rise to Transamerica business in Ireland as number of business operations from across the Europe were channelled through the Dublin operation. The other reason for most of the European deals being channelled through the Dublin office was the fact that there was only one other office in Europe, in Paris. TIRI gives TARe a platform to assist in expanding its business activities in several key markets. In doing so, TIRI provides traditional life reinsurance support to Transamerica International Re (Bermuda), Ltd. and to Transamerica Life Insurance Co (Iowa). TIRI enjoys more favorable tax treatment than many of its competitors due to taxation policies in Ireland that were designed to promote domestic economic growth, and to enable domestic companies to compete effectively in international markets. Due to the favorable tax treatment for corporations in Ireland compared to other European countries, TIRI is an attractive company to reinsure the business written by the Spanish and French offices of TARe. Moreover, TIRI’s status as a reinsurer authorised by the Irish Financial Regulator means that there is no regulatory impediment to writing reinsurance business from any country in the European Union. Social factors in Ireland. Social spending in Ireland is the highest in OECD. Ireland has the second highest spending on sickness, health care and disability. Large number of demographic, economic and social factors can influence the level of social expenditure. The proportion of immigrants can also affect the level of social expenditure, although this depends very much on the social and employment rights of immigrants, as well as on their age profile. However, the most important influences on contemporary social expenditure patterns have been unemployment, economic growth and catch up from the prior expenditure levels. Economical factors have substantial effect on employment/unemployment support. Transamerica Ireland promotes a good employee support relations as it tries its best at meeting its employee’s expectations in healthcare, pension plans and educational support. Transamerica Ireland also strives to keeps its team as professional, knowledgeable and diversified as possible. The office member’s nationalities range from Italian, Spanish, Russian to Slovak and Chinese. Its corporate responsibilities tools include progressions, which is an internship for students coming from unprivileged backgrounds, charity donations on monthly basis and others. Technological factors as access to the internet, innovation and expansion of laboratories have been all present in recent years in Ireland. The largest sector in Ireland is the software development industry (54%). Good communication infrastructure. eGovernment activities, where government supports communication with its institutions via internet is a good ground for IT advancement as in most such cases the private sector follows such steps. Logically all these elements/factors affect Transamerica Ireland operation as well. The company is doing well in using available communications tools as it’s the Video Conferencing. This not only saves the money but also provides a unique chance for speeding up the process in dealing with counterparts in the other Transamerica offices around the globe. Video communication gives the users an opportunity to see a face behind the deals, therefore making the project more personal, which results in favourable handling and effective management of all parties involved. Resulting from the PEST analysis then the recommendation for Transamerica Ireland operation should be to continue to take advantage of the business favourable environment. Adjust to the newly regulated reinsurance industry and become a pioneer in setting a good standard and correct policy-making organization. Transamerica has a great knowledge base sourced from many other abroad businesses and can offer its Irish office excessive list of advices how to expand, advance and gain more market share. The experience and policy-making from other markets has been shared on intercompany level since the beginning of the operation in Ireland in 2001 and can be now widely introduced to standardise its operations and compliancy for the Irish Financial Regulator. The advantage of having low corporate tax will continue to be one of the most crucial advantages the Irish system can offer and Transamerica Ireland should therefore offer wider cooperation to its foreign offices to channel their businesses though the Dublin office. This step should be accompanied with suggestions to open up to new markets and expand on the existing one, which the Irish operation should communicate to the head office and its other Europe offices. This would also raise revenue for the Irish operation thanks to its bigger share of project development and new product placements. Subsequently the Irish office would have a great potential to manage the EU business operations and become a springboard for new EU businesses and operations. It could be the main hub for financial and project development and management operations. Turning the Dublin office in such a crucial operation it would have the potential to overlook the whole EU market and therefore an exceptional expansion potential. References Denis Hall. 2007. Identifying the factors that influence Irish high-tech enterprises to choose one regional location over other Irish regions. Virpi Timonen 2003, Irish social expenditure in a comparative international context Rory O’Donnell, 1998, Ireland economic transformation Industrial Policy, European Integration and Social Partnership Mark Anner, 2004, Paul G. Buchanan and Kate Nicholls, Labour Politics in Small Open Democracies: Australia, Chile, Ireland, New Zealand and Uruguay. John Bruton, 2010, "THE IRISH MIRACLE" CREATING THE CELTIC TIGER