Administrative Services: Operational Re-engineering

Client Project

  • PPI worked within Administrative Services ("AS") to document and understand the current state Case Implementation process for Mid/Large Market and National Accounts. This was followed by future state discussions and workshops facilitated by PPI and development of an Implementation Plan to install business improvements uncovered during the work.
Business Challenges
  • The existing implementation process was segmented between several functional areas (account management, contracts, plan master), which resulted in rework, timing delays and communication/accountability issues, as well as extremely long cycle times.

  • Account managers (~300) were expected to act as implementation generalists, but most actually performed only a few implementations a year, so they lacked the necessary system & process expertise. Consequently they took longer to perform implementation tasks and made many mistakes and omissions that required rework.

  • The group responsible for performing technical setup was only involved at a late stage of the process, when they typically discovered many errors that needed to be corrected before system installation could be completed.

  • Implementation was intended to be a linear process, with tasks passing from account managers to contracts (to produce policies and certificates) to plan master (for system installation), but in practice, the need to deal with issues as they were discovered and to perform rework meant there were many loop-backs and delays.
Specific Recommendations and Outcomes
  • The AS Group restructured some core processes in conjunction with establishing implementation specialists ("Client Acquisition Consultants" or "CACs"). The CACs would work with Account Management, Contracts and Plan Master from the start of implementation to ensure that issues are identified and resolved at an early stage and that implementations are performed in an efficient and consistent manner.

  • Integral case implementation process steps were reordered to involve key resources earlier in the process to identify and address any unusual items that may have previously required rework.

  • A group of Client Acquisition Consultants have been established to function as implementation specialists for all new implementations.

  • Case implementation is now performed as a team activity, not a segmented sequence.

  • Results also include a significant reduction in rework and much faster case implementation cycle times:

    • Plan Master Cycle time has been reduced by >80%.
    • Plan changes have been reduced by >85%, reflecting significant improvement in the quality of initial plan implementation and a substantial cost reduction.

  • Reliance on generalists with insufficient expertise has been replaced by the use of specialists who perform all setups and ensure the right people get involved at the right time.

    • The success of the new process has been built on specialization and proper resource alignment & knowledge.
    • Account Managers can focus on providing higher levels of customer service.
    • CACs, as implementation specialists, can develop a higher level of expertise in the processes and systems required for effective implementation, leading to substantial reduction of effort, error and costs associated with infrequent performance.

  • Additional opportunities exist to expand the approach for future savings, e.g. by deeper specialization of CACs (product expertise, small/large case expertise, project management, etc.), or by merging their function with the responsibilities for contract production and system setup currently performed by the contracts and plan master groups and eliminating the need for handoffs between separate work units.

  • Management testimony - "CACs have really stepped up to the new model and realize that they are responsible to make the implementation go right - whatever that may require. Before they would throw it over the wall to somebody else, now they make certain it gets done."

  • Other benefits included:

    • Simplification of the CS business (reduce complexity).
    • Complexity reduction - simplification of business operations.
    • Cost savings.
    • Greater speed to market.
    • Increased IT leverage.
    • Smart sourcing advantages - right people at the right time.
    • Reduced cycle times.