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Paradigm Shift

On The Record with Andrea Anania, executive vice president and chief information officer, CIGNA...

On The Record with Andrea Anania, executive vice president and chief information officer, CIGNA.

As CIGNA (Philadelphia, $91.6 billion in consolidated assets) strives to transform itself into a customer-oriented enterprise, Andrea Anania is leading a reorganization of the carrier's systems from a line-of-business, "platform-driven" model to a "process-based" environment. This summer Anania, named CIGNA's CIO in 1998, presided over the launch of, the carrier's personalized health and retirement management Web portal offered free to all its plan participants.

I&T: What is the importance of being a customer-focused organization?

ANDREA ANANIA: Plan sponsors and participants "vote" each year as to whether they want to do business withus. Today, end consumers are in the driver's seat, and addressing their needs is the key to competing and winning.

Like most insurance companies, historically we've been internally focused. In IT we considered our business divisions to be our customer, without always appreciating the impact of our services to our external customers. Thus, we've had to turn our focus 180 degrees: from what works for us, to what works best for consumers. For example, we have back-end legacy systems that are 20-plus years old, that we now have to turn around to be customer-facing and consumer-friendly Web services.

It can be like turning a battleship around in a bathtub. It is not just a technology change, it's a wholesale change in philosophy, structure and business processes, involving a new mind-set, as well as new skill sets.

I&T: How did you address such challenges as you led CIGNA's transformation into a consumer-oriented employee benefits provider?

ANANIA: The key for us has been breaking down the traditional structural barriers and "platform-based" focus of CIGNA Systems CIGNA Corp.'s IT division. Up until recently IT reflected CIGNA's historic "multi-line" insurance structure. Our applications development groups and infrastructure were fragmented among seven discrete business divisions--and numerous product line and IT fiefdoms--many of which ended up "reinventing the wheel" many times over because each unit was focused on the predominant platform used by the individual business division.

To remedy this we've refocused the IT organization onto using common processes across applications, which has resulted in consistent service delivery across CIGNA's businesses and improved project outcomes. We've replaced our "platform-driven" structure with a "process-based" environment and also created five "practices" (see box below). These practices are function-driven and consultative in nature, designed to leverage skills and resources, minimize re-work, maximize re-use and take advantage of intellectual capital across business lines.

I&T: What is unique about your Web portal,, and what were some of the implementation challenges involved?

ANANIA: The unique aspects of include a level of scope, scale and personalization that is unprecedented. In terms of scope, we offer the breadth of CIGNA products services through myCIGNA combining medical, dental and pharmacy with pension plans, 401(k), non-qualified and online brokerage. No one that I know of is effectively combining "health and wealth" benefits, nor their ancillary services. Then there's unprecedented scale: We are offering access to virtually all our 16 million plan participants.

The degree of personalization is also unique. Our portal is more than a series of links. It serves up current and complete information about a person's individual healthcare and retirement accounts and presents this information in a way that allows for easier tracking and control. Moreover, users can receive health information and financial education tools tailored to their specific preferences and needs.

Last, but not least, we have an exclusive relationship with Yahoo!. Yahoo not only provided their portal builder tool and expertise in developing a user-friendly interface, but we also link with their My Yahoo home pages, so that CIGNA consumers can go to myCIGNA right from their My Yahoo page.

I&T: How does CIGNA make the most of the resources and skills across the enterprise?

ANANIA: By restructuring IT we've broken down many of the barriers that used to result in a serious amount of redundancy and rework. What did Yogi Berra say about making the same mistakes differently? That was a significant problem.

Even though CIGNA is a large and diverse business, we've structured the systems community to serve as a bridge for sharing cross-divisional learnings. I think the development of epitomizes what we hope to accomplish. We were able to design, build and launch myCIGNA in just six months by leveraging resources and intellectual capital across traditional business lines. Our new engagement model is all about making the right people available at the right time to maximize our ability to deliver the best solution as quickly as possible.

I&T: What steps should health insurance companies be taking to ensure their HIPAA compliance efforts are on-track?

ANANIA: In my view, how the industry handles the issues of security and privacy is a critical determinant of how far we can go to effectively serve our customers via the Web. HIPAA forces this issue. One of our five practices is dedicated solely to information protection. We spend about $30 million a year ensuring that our systems are secure. We also created a new position in 2001, director of e-privacy, to ensure that we anticipate and address plan participants' privacy and security concerns, and to establish and enforce e-commerce compliance standards.

It's been my observation that as an industry, insurers dedicate a lot of resources to information protection, and we have for a long time. Insurers have to be ready to deal with both the reality-as well as consumers' perceptions-in addressing these concerns. In doing so, I think we have a real opportunity to be on the "side of the angels" in the whole e-privacy debate as it takes shape in the months and years ahead.

I&T: Has the current economic environment affected CIGNA's approach to technology spending?

ANANIA: We've continued to invest aggressively throughout the current downturn, at roughly the same level as the previous few years. And in fact, we feel we're getting even better value for our technology spend today. We're not the type of organization that wants to be on the "bleeding" edge of technology. And as I said, our objectives to minimize re-work and maximize re-use help ensure we're spending prudently.

How we are managing this goes back to our process-based restructuring. In the past, when our IT units worked completely autonomously, you might find several units independently signing contracts with the same technology vendor--with different terms, conditions and pricing.

We apply enterprise architecture management, which serves as a disciplined, cross-divisional approach for ensuring that technology products are managed throughout their useful life cycle so that new, strategically important products are introduced at the right time and obsolete products are retired when feasible to do so.

An example of how we've streamlined our approach was the conversion of CIGNA's numerous accounts payable/employee expense reimbursement systems into a single online system. Today virtually all of CIGNA's employees use this single system for entering their invoices and expense transactions. Before we engage in this type of project, we develop a business case that states the costs and benefits. In this case, by introducing this system we've reduced the costs for managing invoices and expense transactions by over 40 percent, including more than $1.5 million in direct annual savings.


CIGNA's Five Practices

Andrea Anania has realigned CIGNA's IT organization away from platform orientation to a process-based environment centered on the five following practices:

-- Technology & Architecture Practice: Manages the architecture and technology for CIGNA and designs application solutions.

-- Application Management Practice: Supports mature applications, so that the business divisions can concentrate on new strategic development.

-- E-Commerce: Provides the expertise in a single group to support application development for divisional and cross-divisional e-commerce projects.

-- Information Protection Practice: Provides security and e-privacy direction and governance for CIGNA.

-- Program Management Office: Improves how projects are managed and delivered across CIGNA through a core set of resources and processes.

Anthony O'Donnell has covered technology in the insurance industry since 2000, when he joined the editorial staff of Insurance & Technology. As an editor and reporter for I&T and the InformationWeek Financial Services of TechWeb he has written on all areas of information ... View Full Bio

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