STRATEGIC ANALYSIS AND SUSTAINABILITY OF INSURANCE COMPANIES IN RWANDA
Abstract
Purpose: This study examined the effect of strategic analysis on the sustainability of insurance companies in Rwanda, recognizing that sound strategic analysis is crucial for organizational survival and growth.
Statement of the Problem: This study examined the role of strategic analysis in enhancing the sustainability of Rwandan insurance companies amid challenges like client dissatisfaction, slow growth, and underperformance, with some firms failing while others rely on mergers and acquisitions to sustain operations.
Methods: The study employed a descriptive survey design and positivist philosophy, targeting 14 insurance companies and 252 managers through census sampling and structured questionnaires. Data validity and reliability were ensured through pilot testing, with analysis conducted using descriptive and inferential statistics in SPSS version 21.
Results: The findings revealed a statistically significant relationship between strategic analysis and sustainability of insurance companies in Rwanda (β = 1.495, p < 0.05). The study established that strategic analysis explained 89.3% of the variation in the sustainability of insurance firms, indicating its critical role in long-term business success. However, most insurance companies relied solely on management for strategic analysis, with limited involvement of employees, which may hinder effective strategy implementation.
Conclusion: The study concludes that strategic analysis significantly influences the sustainability of insurance companies in Rwanda, with tools such as SWOT, PESTEL, and Gap Analysis playing a crucial role in assessing both internal and external business environments. However, despite its significance, limited employee participation in strategic analysis remains a challenge that could impact long-term sustainability.
Recommendations: To enhance sustainability, the study recommends that insurance companies actively involve employees in the strategic analysis phase to foster ownership and commitment to the developed strategies. Additionally, firms should strengthen their strategic management frameworks by integrating comprehensive market analysis tools to navigate the dynamic business environment effectively.
Keywords: Strategic Analysis, Sustainability, Insurance Companies, Rwanda
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