Redesign of Product Development Process: Leading Health Plan

As part of its strategy to differentiate itself on product customization, a recently-merged health plan used the Fast-Track Change Process to dramatically reduce the average time required to bring its products to market.

The Challenge

This health plan faced intense competition in a rapidly consolidating regional marketplace, where it was no longer possible to compete on the basis of pricing, product uniqueness, or provider network. Major purchasers of health care benefits wanted increasingly complex products, and competitive bids were increasingly all-or-nothing. The health plan decided to differentiate itself on product customization, along with quality of care and customer service.

To implement its product customization strategy, the health plan needed, within five months, to drastically reduce its time-to-market with new products, without in any way diminishing the quality of products or service. With the exception of one product, the product development and delivery processes for the two pre-merger companies were still separate. Once a new product concept was approved, it was averaging 42 weeks to “go live” in a customer organization. The company needed one process with an average cycle-time of 20 weeks.

The Project

A change process was needed that would move quickly, incorporate a great deal of non-traditional thinking, and mobilize sustained leadership support across a number of functional boundaries. To accomplish this daunting task, the VP of Product Development and five other senior-level Sponsors turned to the Fast-Track Change Process. The Sponsors defined the objectives and “scope” of the change. Then a cross-functional Planning Team of eight people broke the highly complex process into five major components, identified teams to work on the redesign of each component, and clarified the objectives for each team. With our help, they planned a Redesign Meeting, where these teams would create a new product development and delivery process and then present their recommendations to the Sponsor Team.

Excellent. Extremely well coordinated and managed.

The Team Challenges and other documentation provided up-front was extremely clear and concise.

The Redesign Meeting was intense. About 60 people, many of whom had not been in the same room since the merger, worked closely together for four days. As the new process began to take shape, its critical path was tracked and fed back. Finally, on the last day a number of breakthroughs were made, taking the time down to 18 weeks! In the Decision-Making Session at the end of the meeting, the Sponsors approved 27 of 28 recommendations (and later approved the 28th). People were exhausted but overjoyed. The health plan’s CFO, one of the Sponsors, got up and told the group they had clearly saved the company millions of dollars.

The Redesign Meeting exceeded my expectations. When we started, it seemed inconceivable to me that the teams would be so cohesive or that we’d be able to meet the cycle-time objective.

This process was superior to other change methods I’ve been involved in because the cost-benefit analysis was an integral part of redesigning the process, and the teams did a superior job of taking into account the inputs and outputs and interdependencies between different parts of the process.

The facilitation was better than for any change effort I’ve been involved with in the past.

The Results

A Core Implementation Team coordinated the larger group of 60, who took responsibility for implementing the approved action items. Every 30 days, the Core Team met with the Sponsors to review progress. As with all Fast-Track projects, the Sponsors’ role was to hold people’s feet to the fire and remove any potential roadblocks. Using this approach, the company was able to implement the necessary parts of the new process in 90 days.

This redesign gets us beyond most of the confusion and fog the company has been in for over a year.

The process really helped unify the two sides of the organization that had still been separate two years after the merger.

Compared to other process-redesign efforts I’ve been involved in, this was much, much faster.

This is by far the most gratifying and results-oriented process I’ve been involved in over the past 12 years.

Excellent preparation, breakthrough thinking, focused results. Fast-Track should absolutely be used to address other issues in the company.

Nothing I have experienced before can compare to this!

The consultants were superb. We could not have done this without their level of expertise.

Other change projects I’ve been involved with have been 80% consultant input. I feel we really own this one!

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