Aetna Essay

4668 Words 19 Pages
Organizational Strategy Mid-Term

1. What is Strategy? Strategy simply put is long term goal of an organization that you base all business functions around. Your strategy what gives you a form of differentiation between you and your competitors? A strategy is the one thing that needs to stay consistent throughout all business decisions. The business world is always changing, so strategies that focus on positioning could quickly become irrelevant once the industry has shifted. It’s the underlying concept behind a position that should be utilized as your strategy. While all companies strive to increase profits, and shareholder value, that is not a strategy, it is a “constraint”. Those are requirements for a business. A strategy
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This is where operational efficiency is a key tool to differentiate Aetna from their competitors. According to Michael Porter, Operational efficiently “means performing similar activities better than rivals perform them.” What has continually put Aetna above other insurance companies is Aetna’s strategy has always focused on building and maintaining great relationships with the providers and patients of the health care industry. They quote quite often “we put the people we serve at the center of everything we do”. They realize that the success of their company completely relies on those relationships. According to a Wall Street Journal article, Aetna was “ranked first among more than 130 big health insurers in how quickly and accurately they reimburse doctors, based on factors such as how long carriers take to pay bills, the percentage of claims they resolve after one submission and their claim-denial rates.” An Aetna employee said the company has ”improved efficiency, in part, through technology and by clarifying its policies with doctors” Aetna was one of the first companies in the industry to utilize technological advances in order to increase efficiently. CEO Ron Williams created Care Engine, which is a computer system that contains all members’ health information. These systems

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