Name: Kan Wu Date: 4/16/2012 Course: IT 203 CIGNA Property and Casualty Reengineering In 1988, CIGNA began their

reengineering in projects in all nine divisions in order to cut cost, increase productivity and reduce headcount. Tom Valerio, the Senior Vice President for Reengineering soon discovered a problem that most of CIGNA IT budget was allocated to legacy systems maintenance and enhancement. Up to this point, with the help of Gemini and Renaissance, The group decided to make significant structural changes and brought a new executive team to CIGNA, However, they were also challenged by constraining factors: a nine-month time frame for concept to production and the necessity to use the existing infrastructure. Finally they use the two-tiers systems, the balanced scorecard and desktops information technology support to complete the structural changes and save the company.

Haapaniemi(1996) use the idea of utilizing latest capabilities of IT to achieve entirely new objectives by giving the example of Alcoa, Inc. Alcoa announced the largest IT project in its history, an overhaul of its basic computer infrastructure. The $150 million effort spanned 26 countries and took several years to complete. The effort is ambitious and complicated,

but the goal is elegantly simple and clear, Let employees around the communicate quickly and easily. Alcoas initiative reflects a basic fact life in the use of strategic IT. It is similar to the case of CIGNA, the new tools like two-ties and balance scorecard are focused increasingly on creating connections between employees, across functions, with and between data and decision-makers. A good system also needed communication between workers and information, at this aspect, CIGNA did better as they worked closely with the internal team by insourcing because they believed that it helped to expedite the process and it was threatening than outsourcing. Whatever, strategic IT plays an important role in Reengineering of both companies. Supermarkets like Wall-Mart have used IT to drive their business. The scanners that are used to check out commodities provide a huge benefit making it possible to track sales in real time. A strong IT solution was developed and then problem that it will solve was found. The use of IT reduced the customer check out times and reduced the cashier labor in addition to tracking sales. Compared to the Wall-Mart, CIGNAs desktops information system linked the producer, underwriting, claims together to improve the effectiveness and decision-making process. Although they different systems, with the client architecture, the value delivered by information technology to knowledge workers could in turn be to customers as more efficient service.

References 1. Gunasekaran, A. A., & Nath, B. B. (1997). The role of information technology in business process reengineering. International Journal Of Production Economics, 50(2/3), 91. 2. Kunsoo, H., Young Bong, C., & Jungpil, H. (2011). Information Technology Spillover and Productivity: The Role of Information Technology Intensity and Competition. Journal Of Management Information Systems, 28(1), 115-145.

3. Nolan, R. L., Stoddard, D. B., Martin, E., & Francalanci, C. (1995). CIGNA Property and Casualty Reengineering (A). Harvard Business School Cases, 1.