When Lori Beer was named acting CIO of WellPoint in May 2008, she was uniquely prepared for a job that badly needed to be tackled. While the Indianapolis-based health insurer had benefited from outstanding technology leadership in the past, the company's IT organization faced challenges springing from the $16.4 billion megamerger of WellPoint and Anthem -- two companies with significant M&A activity in their recent pasts.
At the time of the merger, Beer, a 20-plus-year veteran of IT, had spent several years at Anthem -- the larger of the two merged companies -- in various senior roles. Her role as CTO of WellPoint, which she held before she officially became CIO in August 2008, was perhaps most significant for an organization facing consolidation and business alignment challenges.
"We had a centralized CIO organization, but underneath that were federated silos of teams that weren't thinking about the end-to-end solutions to deliver value to the business," Beer recollects. "So we took a hard look at our operating model and put a new one in place, between August and September 2008, to drive engagement with the business and also focus on building the disciplines of project management, software development, quality assurance and infrastructure services."
The magnitude of change required for the switch from the old IT operating model to the new necessitated a change in thinking, according to Beer, who proceeded toward the end of 2008 to remove 80 percent of the IT organization's leadership and replace it with talent from other organizations and industries. "Financial services are good at putting changes into production because they need to change things rapidly, so we brought some of that thinking in," Beer says. "We also brought some thinking in from a consumer retail perspective."
Beer's next step was to develop an IT strategy focused on rationalizing WellPoint's application portfolio and setting the course for the insurer's future strategic technology platform. "We had a lot of initiatives and projects, but we lacked an integrated information systems plan," she comments. "We developed what we call our 'North Star Strategy' to help us simplify our systems environment and improve how we enable the business through the use of technology."
Beer's goal in creating the new operating model, changing out the leadership and developing the North Star Strategy, she relates, was aimed not merely at better organizing WellPoint's IT organization but reorienting it to be a strategic partner with the business. "We had been more in the mode of taking orders, fighting fires and being focused on day-to-day challenges," Beer remarks. "Our goal today is being a strategic partner to the business and asking how we can create greater value for every dollar that is invested in technology -- it is clear that technology is going to play a key role in transforming this industry."
Having been CTO of WellPoint (more than $61 billion in annual revenue), Beer is in an excellent position as CIO to "connect the dots" of the insurer's various technology assets toward an integrated strategy, she affirms. As CIO, however, Beer's focus on the technology itself is tempered in favor of an even greater focus on the business component, she acknowledges. "In some respects I'm doing the same kind of work, but now the focus is making sure the strategies across the business are integrated into our technology solutions," Beer says. "We could build the best technology solution, but if we hadn't adequately integrated the business processes, WellPoint wouldn't get momentum out of our IT strategy."
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