Integrated Talent Management at Aetna, Case Study Example

Aetna is a leader in the healthcare market, employing over 35,000 people. The company found that they were losing more than $1 million daily due to poor business management. In order to change the direction, a leader was hired to establish a three-phase plan that will focus on strategy, operational and financial performance. The next focus is the talent transformation, which will highlight the competencies needed for leadership. Mapping the skills of leadership competencies will provide a map for improving the necessary qualities in a leader. Lastly, the plan will include Foundation, Advanced, and Mastery Skills of leadership competencies. Aetna is a company that has captivated the market and by making the necessary changes can improve their overall performance and reduce the substantial financial loss it has been challenged with.

Strategy, Operational and Financial Performance

As a new leader at Aetna, the goal is to devise a multi-year, three-phase plan which covers three categories, strategy, operational, and financial performance. A vital part of the initiative is dependent upon HR support in promoting talent and building a commitment to the new plan throughout the organization. The changes are dependent upon minimal resources and continuing operation without delay.

Strategic performance

The goal of the strategic performance is broken down into three phases, first is to redefine the purpose of the organization, clarify personal involvement for reaching the organizational objectives, and validate the empirical verification. Defining the purpose of the organization is vital to any company’s success. “Every organization, whether private company or nonprofit organization (NPO), should set out to benefit one clearly defined group of beneficiaries, and a single, long-term, verifiable, target figure should be configured to reflect what it is trying to do for them. If it cannot set such a target, the organization should be reformed until this becomes possible” (Use Strategic, 2015, np). Creating strategic performance goals is only part of the equation, it is also important to involve the employees in the vision and ensure they have a clear idea of the changes the company is making. Training and on the job feedback are excellent tools which allow business to continue as normal while making important changes. Empirical verification provides a method to measure the strategic performance and verify it is where it needs to be.

Operational performance

The company’s plan for operational performance is broken down into three main phases, back to basics, perfect the basics and unique capabilities. The company and the employees have lost the vision of the company’s goals. Customer service and training is important to maintain the integrity and bottom-line of the company. “These new processes direct employee behavior and support a more rigorous approach to aligning training to the business strategy” (Levensaler, 2008, p.6). Perfecting the basics takes the basics to a new level, ensuring there is no question of the employee’s responsibility to the consumer, company, and shareholders equally. Unique capabilities will require management to have the right people at the right position, at the best time for the right costs. It will ensure that employee strengths will be utilized, and the company will benefit from their training and expertise.

Financial performance

The company will implement three main phases for their financial performance as well. These three steps will include stopping the loss, equalizing the expenditures, and shift to profitability. The company needs to stop the loss, which is substantial of almost a million a day. The strategic and operational performance plan will aid in the process of stopping the loss. The company will then focus on the equalizing expenditures. The company needs to continue with business as normal while making substantial changes to their processes and procedures. Lastly, the company needs to focus on increasing their profitability, which will provide clear and measurable goals. Increasing profitability will become easier when the company has their performance plans in position.

From a Human Resource perspective, it is important to identify the gaps in performance. The company has set specific goals and plans for implementation. “From a strategic perspective, competencies were built to support increasing levels of skill (from foundation to mastery levels) and to support customer satisfaction (based on the competency evaluation scale of “expect,” “exceed” or “differentiate”). The goal was to create thoughtful skills that would continue to be relevant throughout and beyond the turnaround. Overall, 120 competencies were identified” (Levensaler, 2008, p.7). The gaps in the performance which the company has failed to address will create employee opposition. When organizational changes occur, employees will exhibit a certain level of resistance. It is important for the leader to have a plan in place to address the resistance and ensure that the plan is implemented with as little issues as possible.

Talent Transformation

The talent transformation efforts initially placed their focus efforts on employees learning and development. The learning and development over time have developed into fully integrated strategic focus that links all of Aetna’s talent management processes. Leadership competencies are the primary focus for the talent transformation. The first leadership skill is social intelligence. Social intelligence is vital for effective leadership however it is often under-researched and poorly understood. The term can be quite broad however it is a method for understanding social situations and being able to address and adapt to these conditions. A leader should expose themselves to different people and social situations to develop and engage in different social situations. The second competency is interpersonal skills. “Interpersonal skills could be seen as a subset of social intelligence, but these are the most relationship-oriented aspects of social effectiveness. We often talk about the “soft skills” of the leader, and these are best represented by interpersonal skills” (Riggio, 2014, np). The competency provides an opportunity for the leader to become an active listener, and intern work better with others in the workplace.

A leader must also have the competency to have utilize emotional intelligence.  Emotional intelligence is the ability to understand emotions, emotional situations, and the ability to connect on an emotional level. It is sometimes referred to as leadership charisma. A leader should be competent to read nonverbal cues especially the cues of emotion. A leader should have the competency to be prudent. “Prudence is one of Aristotle’s cardinal virtues. A synonym is “wisdom,” but it comes from being able to see others’ perspectives and through being open to and considering others’ points of view” (Riggio, 2014, np). A leader can develop prudence by listening to others. To be open minded and to consider the opinion and positions of others to gain a common ground. A leader must also have the competency of being courageous. A leader should be able to do the right thing and to stand up for what they believe. It is important for a leader at Aetna to be able to stand up for the changes that are being implemented. Holding personal values for what one believes makes it easier to take a position that can prove to be challenging.

A sixth consideration is that a leader must have the competency to be able to handle conflict management. A leader must have the ability to resolve or avoid interpersonal conflicts. Leaders are often required to take a position to resolves issues among employees; they need to be able to address the conflict if it arises. Conflict management skills require training and courses to find the best methods for defusing a situation. Finding a win-win outcome is not easy; however, it can be accomplished if the leader has the necessary conflict management skills. A leader should also have the competency of decision making. Aetna is a large company so that decision making could be extremely difficult. A good leader should be able to make right decisions. It requires the ability to understand the bigger picture and to consult with peers and subordinates in the decision-making process. A leader must also know when they need to take a step back and allow others to make the decision. Decision-making skills requires studying situations when bad decisions have directly affected the company. Learning from mistakes is an important part of a successful leader.

A leader needs to have the ability to utilize political skills for a positive outcome. “An effective leader is a good political player, who knows how the game is played, but can also manage political behavior so that it does not lead to group or organizational dysfunction” (Riggio, 2014, np). Aetna has their politics that the company uses to optimize their priorities. People will try to gain support for their own agendas and bend the rules to obtain the support they need, therefore politics needs to be used for a positive outcome instead of a negative. A highly developed leader has the ability to address the political skills and the social dynamic which motivates individuals. A leader must have the competency to influence skills. A leader can influence others to support the cause they are working towards. Aetna needs leaders to be able to influence their peers to the changes the company is working towards making. Influencing employees cannot be trained; however, well-thought-out arguments can be learned. It is important for a leader to see things from others perspectives to influence employees. Lastly, a leader must have the competency for their area of expertise. It requires the leader to have working knowledge of the goals and the desired outcomes.

Map the Skills for a Leader

 Mapping the skills for a successful leader can vary from situation to situation. For Aetna the model provides the relationship between four main contributions for the leader’s success or failure. The map first considers the leader. It is the individual who is in charge of a group or department’s performance. The followers are the people who following the leader and their guidance within the organization. Another contribution is the context. It is the situation in which the work is performed which includes departments or specific goals. Context can also include the physical environment and any event which takes place within Aetna. Finally consider the outcome. It shows the effectiveness of the leaders and the results of the process. Outcome shows if a particular goal was met which includes implement strategic change and financial loss.

The map above shows the transfer of leaders and their direct influence over the outcome. “The model shows the way in which the leader, the followers, and the context combine to affect the outcomes. It also shows how outcomes feedback to affect the leader, the followers, and the context” (Manktelow, 2013, np). The map provides a guideline for the leader to see the outcome of their personal involvement.

Foundation, Advanced, and Mastery Skills of Leadership

The foundation of leadership competency is based on two main factors, the ability to lead and access to the adequate training. A leader has their personal skills that provide them an advantage for communicating and leading others in a specified direction. Training provides them with the skills to use the personal traits to lead others towards a common goal. The advanced skills of leadership require additional training and hands-on experience. In order for a leader to develop his competencies it requires them to move past the basics and focus on further development. It will need hands-on experience and feedback from upper management and peers equally. A leader can have the foundation to be good, but it is the advanced training and experience that can make them great. It is a continual learning process through classroom training, peer feedback, and supervisory directives. A mastery of the skills of leadership will be able to take six main challenges and implement them all at once. It includes the ability to anticipate, challenge, interpret, decide, align, and learn. A master skill of leadership requires the individual to be flexible, persistent, and reactive. “Strategic leaders are the focal point for organizational learning. They promote a culture of inquiry, and they search for the lessons in both successful and unsuccessful outcomes. They study failures—their own and their teams’—in an open, constructive way to find the hidden lessons” (Schoemaker, Krupp, & Howland, 2013, np). A master in skills of leadership requires that a leader learns how to implement multiple skills at a time and adapt to any situation that arises in the organization.

Aetna has created many changes in the structure of their organization in efforts to improve productivity and their financial position. The company is too large to stop business to facilitate the necessary modifications. The plan that has been implemented is heavily dependent upon the leader’s ability to motivate and control their peer’s involvement. The company needs to evaluate their recommended changes for their strategic, operational, and financial performance. It requires the company to set checkpoints to ensure they are reaching their desired outcome. Providing the company has provided the necessary resources for their leaders development is a vital part of their success. With the proposed changes, the company can change their position and be a more efficient business while increasing their bottom line.

References

Levensaler, Leighanne. (2008). Integrated talent management at Aetna. BERSIN & ASSOCIATES. (p.6-7)

Manktelow, James. (2013). Dunham and Pierce’s leadership process model.(np). Retrieved from www.mindtools.com/pages/article/leadership-process.htm

Riggio, Ronald E. PhD. (2014). The top 10 leadership competencies. (np). Retrieved from www.psychologytoday.com/blog/cutting-edge-leadership/201404/the-top-10-leadership-competencies

Schoemaker, Paul J.H.; Steve Krupp; & Samantha Howland. (2013). Strategic leadership: The essential skills. (np). Retrieved from hbr.org/2013/01/strategic-leadership-the-esssential-skills

Use Strategic Planning to renew your organization. (2015). (np). Retrieved from www.simply-strategic-planning.com/