Sun Life Financial Services

I. Time of context/period
1865 Present
II. Summary
In 1865, when a group of businessmen met in Montreal to discuss the possibility of
starting a life insurance company. During 1871, the company was incorporated, and soon its
agents were working in seven regions, from Halifax, Nova Scotia to Woodstock, Ontario.
Sun Life expanded its operations to overseas markets, very early on. In 1892, it entered
Hong Kong, and in 1893 it started its operations in the United Kingdom (UK). In 1895, it
entered the United States (US) through Sun Life Assurance Company. The company
operated in 49 states (all except for the state of New York), the District of Columbia and
Puerto Rico. In the same year, it entered Philippines and West Indies. The company also
moved into other areas of insurance. In 1919, Sun Life became the first Canadian company
to issue group insurance, and by 1942, assets under its management touched the C$1
billion marks. Sun Life entered the health insurance business in 1956, and in the same year
it was converted from a shareholders ownership in a mutual company, owned by its
policyholders. In 1982, it acquired Massachusetts Financial Services Company (MFS) and
entered the mutual funds business in the US. The following year, it entered into the unit trust
business in the UK and expanded its operations. The growth of Sun Life as a financial
conglomerate was attributed to its acquisitions, which gave it significant market shares. In
1986, Sun Life entered the mutual fund business in Canada through Spectrum Mutual Fund
Services. By the early 1990s, the company reached the C$300 billion mark in life insurance,
and assets under its management was around C$107 billion. In 1995, it opened a
representative office in Beijing to explore the business opportunities in the world's most
populous country. The company's had a diversified product range, which included financial
services such as mutual funds, pension plans, annuities, and investment management
services. It offered its services through different affiliates such as Sun Life Assurance
Company of Canada, Sun Life Securities Inc. and Spectrum Investment Management
Limited. The case provides a detailed insight into the strategies adopted by Canadian
insurance major Sun Life Financial Services in various areas. It provides information about
the company's history, its evolution and examines its marketing, finance and human
 resources strategies. Details about the various mergers and acquisitions undertaken by the
company over the years are given. The case also provides an insight into the company's
global operations and examines its performance in various geographical segments. Sun
Life's merger with Clarica is explored in detail and the implications of the merger on the
Canadian insurance market are studied. Finally, the case provides a detailed note on the
global insurance market and on the Canadian insurance market.

Mission
To help customers achieve lifetime financial security
Vision
To be a world class provider of financial security to individual over their lifetimes.
II. Objective/s
To demonstrate to the public and stakeholders that Sun Life's ethics were sound;
To describe Sun Life Financial's values and standards of business conduct;
To guide employees on how to resolve potentially difficult situations and conflicts of
interest;
To promote principles of respect and fairness in the workplace and in dealings with the
public and stakeholders
III. Central problem
Changes taking place in the Canadian insurance market after passing of Bill C-8
which would allow more flexibility for the companies
IV. Areas of Consideration (SWOT Analysis)

Strength Weakness

1. Strong legacy since 1865 1. The company is highly dependent on

2. International operations in more than 15 the American market for generating its
countries profits
3. Sun Life ranks on the Forbes Global 2000 list 2. Weaker cost structure as compared to
and also Fortune 500 list competitors
4. Sun Life Financial has a strong presence in 3. Economic recession
investment management with strong assets 4. More fraudulent claims
under management operating in a number of
countries
5. It has expertise in life insurance, asset
management and pension
 Opportunities Threats

1. The ageing population in the American 1. There is an increase in strictness in the

market poses a huge opportunity for the
retirement market.
2. Expand business worldwide
3. Improve online marketing
4. Start programs of insurance
5. Effective customer relationship system
6. Special discounts and free gifts
regulatory compliance and complexity in
the US market leading to increase in
costs.
2. The subprime crisis has resulted in a
low policy interest rate environment.
3. Competition
4. High operating cost

V. Alternative courses of action

ACA Advantage Disadvantage

1. Improve its Increase in profit Additional cost

product mix Focus on the attention of market High risk of loss
share Competitors may also
Huge market opportunities are improve their products
available
Risk of failure
2. Diversification of Improve competency Increase in expenditure
their operations Absorb the deficiency of working
capital

3. Maintain status Familiarity with the old operations

Risk of non-development
quo in their Taking on the demands of the
operations
operations environment
Lack of improvement in
The company meets satisfactorily
the company

VI. Recommendation/Strategy formulation

I, therefore, conclude that the best solution to the problem is the
alternative course of action #2 which is the diversification of their operations through
horizontal integration, they should consider lines which are relevant to the financial
industry. They may take on activities which are expressly complementary of their current
strategy and consequent activities. They could offer other financial instruments in their
operations. These include credit and debit cards along with loans that would cater to the
common wage earner. Specifically, the expansion of the platform of the company should
 be considered so as to improve the current situation of Sun Life Financials operations
in Asia.

VII. Plan of Action

Activity Person Time Objective/s

Responsible frame
1. Gathers the data and Top Mgt. & other 3 weeks To achieve the program
information for the Depts. To ensure each
diversification of the department will perform
operations

2. Prepare the budget for Finance Dept. 2 weeks To allocate the expenses
research & marketing
department
To avoid wasting the
3. Hire expert w/ regards to
Human 2-3 weeks amount of money & time
how to improve the
Resources Dept.
diversify operations

To know if the client

4. Look after the result
Top Mgt. 2-3 weeks embraced it

VIII. Potential problem

1. What if the Sun life financial services diversification of the operations did not satisfy the
visitors?
2. What if the competition in the financial market is getting more intense every year?
3. What if the attractiveness of the markets indicates that more companies from different
strings of the financial industry shall seek entry into the market?
IX. Contingency plan
1. The Sun life financial services should continue to invest in its introducing and creating
another strategy for the clients that may satisfy them in the future.
2. The Sun life financial services would find some barriers in its development because it
means there is a relatively new entrant in the industry.
3. The Sun life financial services has already intense competition existing in the market and
is expecting to become more intense as more players means that companies will have to
compete deeply for their market share.