Aetna is one of the leading providers of health care, dental, pharmacy, group life, disability and long-term care benefits. But what many of us don’t realize is the dramatic turnaround that Aetna made over the past few years. Aetna’s metamorphosis began with a new CEO, a new vision and a new business strategy that would give the senior leaders accountability for the profit and loss of their units – a dramatic change in responsibilities from the previous regime. The task that lay ahead of Aetna’s executive development staff was vital: retool the 500-plus senior leaders with the turnaround and back to basics skills necessary to succeed.
How would they measure the success of their learning initiatives? The same way the CEO measures success – with Wall Street numbers: revenue, income, assets and membership growth. “We chose these measures because we knew their importance, and we knew our target audience could apply what they learned to influence the numbers,” said Joyce Petrella, learning head of executive development at Aetna. Petrella and her team watched the movement of these measures closely in parallel with the executives. They were able to work with the leaders to build curriculum maps by identifying the skills necessary to execute the strategy and pinpoint those metrics from financial statements that leaders could track.
Aetna Executive Development delivered the necessary programs using a blend of live workshops and self-study resources. Aetna partnered with a Harvard Business School professional to deliver the live workshop segments, an investment that paid off well in the quality of delivery and knowledge of the subjects. Participants were instructed to apply the learned concepts using real Aetna scenarios in the field rather than theoretical examples from the classroom. This approach allowed the executives to remain in their element and solve real problems as part of the learning experience. In conjunction with watching the business measures, Aetna Executive Development captured other key measures throughout the programs, including the number of student days, cost of the programs and Kirkpatrick Level 1 reaction surveys. The surveys quickly identified whether the executives felt the programs were worthwhile. Positive survey results were an early indicator of good things to come.
One example of how Aetna used business measures as an indicator for executive learning was with their marketing skills program. By working with the executives responsible for profit and loss, Aetna selected income statement figures that had challenging growth objectives, and then focused on teaching strategic marketing skills that could be applied to products and services that contributed to growth. Aetna tracked growth in membership and premiums, improvements in medical cost, retention rates and, most importantly, operating margins. The findings surprised both the learning organization and the business leaders: All of the metrics were positively impacted. Membership grew, retention improved, and profit was enhanced.
In the past, Aetna looked at various ROI methodologies and discovered that ROI could be demonstrated by asking the right questions and putting lots of process in place to calculate it. The company ended up with an impressive return of $15.50 in after-tax net revenue for every training dollar spent, but this number didn’t provide any new insights. It didn’t tell the company whether the education truly impacted the achievement of results or simply assisted in avoiding costs. Furthermore, the models didn’t reveal if the same results could be achieved with less investment. A prospective tool was needed to consider education investments prior to launching the initiatives.
Today, Petrella and her team are beginning to use the financial analysis payback method to determine just how much education to provide the executive staff and whether all the right critical success factors, such as timing and alignment with incentives, are in place. “The tool provides us with one more step of rigor before we make a ‘go/no-go’ decision. We don’t want to make the investment unless all the right factors are in place, and we are confident the impact can be seen within a reasonable timeframe,” Petrella said. “The payback method gives us the break-even point for many of our learning initiatives. If we are not happy with the estimated ROI or payback period, we shouldn’t proceed.”
Nearly four years later, the turnaround phase for Aetna is officially complete. With the rebuilding in the past, Executive Development is now refitting the curriculum to focus on industry leadership. With a watchful eye on the key measures, Aetna is poised to assist the leadership in executing strategy and break new ground in cultivating tomorrow’s leaders.
Chris Moore is president of Zeroed-In Technologies and the creator of CLO Dashboard and other innovative solutions for visualizing and measuring learning strategies. He can be reached at email@example.com.Filed under: Measurement