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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Introduction Contd...

According to analysts, one of the main reasons for Cigna's poor customer service and the resultant reduction in membership was the failure of the restructuring of its information technology (IT) and CRM3 systems, at its HealthCare division.

This US$ 1 billion project was aimed at moving 3.5 million customers of Cigna from the twenty year old computer systems to new AS400 systems that supported claims processing platforms - PowerMHS software and ProClaim software.

The project was monitored by the Chief Information Officer (CIO), Andrea Anania (Anania).

Despite Anania's confidence in it, the changeover did not go smoothly, encountering several glitches.

As a result, customer service went haywire resulting in millions of dissatisfied customers. The company lost six percent of its healthcare members in 2002 alone.

The management of Cigna, during the shareholders' meeting in October 2002, accepted that they had been unsuccessful in executing the project. Cigna's top management analyzed the reasons for the debacle.

The reasons cited were: greater than expected cost of implementing the project, and misconceptions about the timing of the economic benefits from the project...

Excerpts >>

3] CRM is the method of using integrated information networks to establish and maintain a long-term relationship with customers through personalized customer contacts. CRM records information about customers like transactions, preferences, and even personal information. It then uses software to manage the information to serve specific business purposes and determine future needs of customers.

 

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