CRM Implementation Failure at Cigna Corporation|IT and Systems|Case Study|Case Studies

CRM Implementation Failure at Cigna Corporation

            
 
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Case Details:

Case Code : ITSY050
Case Length : 14 Pages
Period : 2000-2005
Pub Date : 2005
Teaching Note :Not Available
Organization : Cigna Corporation
Industry : Health Care Insurance
Countries : US

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This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.



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"Unfortunately, we have not executed well on transformation."1

- Patrick Welch, President, Cigna Healthcare, on the implementation of the CRM
Systems in 2003.

"They had no clue about what it would take to get all the docs, hospitals, fee schedules and everything loaded on the new systems."2

- Former employee of Cigna Healthcare, on the procedure adopted to migrate customer accounts to the new systems, in 2004.

Introduction

At a press conference in December 2002, the management of Cigna Corporation (Cigna), one of the largest health insurers in the US, announced that problems in their customer database systems had resulted in misquoting their number of customers by an extra 900,000. The beginning of 2002 saw Cigna face problems on many fronts including customer service and profitability. The company's membership fell due to poor customer service and by the end of 2002, the membership was 12.5 million, down from 13.3 million at the end of 2001. For the fiscal year 2002, Cigna reported revenues of US$ 19.34 billion and a net loss of US$ 398 million (Refer Exhibit I for Cigna's consolidated statements of income between 1999 and 2004).

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1] Alison Bass, "Cigna's Self Inflicted Wounds," www.cio.com, March 15, 2003.

2] Bonar Menninger, "Cigna's Turnaround," www.healthleaders.com, September 2004.


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