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E Commerce Proposal
 

E Commerce Proposal

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E Commerce Proposal E Commerce Proposal Presentation Transcript

  • eCommerce Enablement at CareFirst Revised Approach and Proposal August 6, 1999
    • How can I grow both my top line and my bottom line with the internet and eCommerce?
    • How can we use it to enable my business strategy of growth and consumerism?
    • What are my competitors doing?
    • What happens if I don’t get a stake in the ground soon?
    • What investments will I have to make?
    • What will the political ramifications be?
    • Where do I start in order to get the highest value?
    Many eCommerce questions are core to CareFirst’s business strategy.
  • eCommerce Overview and Dynamics 11 Proposed Timeline and Team 50 Potential Benefits and Cost 57 Context and Project Objectives 29 Proposed Approach and Deliverables 33 Why Partner with Andersen Consulting? 60 Executive Summary 3
  • Conservatively estimated, CareFirst’s potential annual cost savings and revenue enhancements exceed $100MM. Enhance Revenue Reduce Costs Reduce Non-Care Related Costs Reduce Care Related Costs Potential eCommerce Benefits Attract/Retain More Members Expand Share of Each Customer eCommerce Economic Value Tree (9.1) Value Potential ($MM) (90.0) $ 22.0 $ 16.5 ($ 99.1) $ 38.5
  • CareFirst has significant work to do to move up the curve of eCommerce capabilities. Many health plans are ahead, yet few are personalized. Source: Andersen Consulting research, industry literature Healthcare eCommerce Service Spectrum Information Commerce Personalization Inquiry Transaction Oxford BS CA Aetna Cigna Kaiser Well point UHG Care First High Low High Low Degree of Buyer Focus In Customer Service eCommerce Interactivity Level ILLUSTRATIVE
  • This project is designed to begin rolling out eCommerce capabilities to constituents as quickly as possible in 1999.
    • Choose the highest-value eCapabilities
    • Design the high-level business, technical and security architectures
    • Lay out business case and implementation plan
    • Understand business, technical and political implications
    Project Objectives
  • Andersen Consulting has worked with CareFirst to design a two-phase approach which will deliver capabilities to the marketplace by 4Q99. Set eVision Quickly determine the highest-value opportunities considering impacts on business value, cost, technology, business strategy and constituent politics Phase 1 Approach = Scope of this proposal 3 Weeks Design eArchitecture Design short- and long-term development and run-time environments 6 Weeks Plan Rollout Develop business case and plan rollout timeline and approach 3 Weeks
    • Prioritized set of eCapabilities
    • Market assessment of potential consumer/ provider uptake of eCapabilities in CareFirst’s markets
    • Summary of competitors and potential alliance partners
    • eVision prototype demonstration
    • Conceptual design for eCommerce environment
    • IT strategy and IT Blueprint implications
    • eCommerce organization chart
    • Executive-level business case
    • Assumptions, technical risks and political risks documents
    Deliverables Phase 2 Launch Pilots Adjust Speed Scale Fast
  • The CEO’s role is critical to selecting the right eCapabilities and partnerships to pursue, addressing any board or constituent concerns, and setting the tone for cultural change.
    • Participate in steering committee meetings
    • Provide input on prioritization criteria and lead the selection of eCapabilities
    • Provide guidance on political considerations regarding CareFirst constituents (providers, members, legislators, brokers, purchasers) and work with these constituents as necessary to set direction
    • Choose and approve any recommended partnerships for either eCapabilities or content
    • Make resource decisions regarding CareFirst team member priorities
    • Set tone for CareFirst’s overall cultural change by becoming more informed about eCommerce and advocating its use where appropriate
    During the project, Bill Jews should play a critical role in several areas, dedicating a recommended one to two hours per week. Suggested areas for participation include:
  • Andersen Consulting is uniquely qualified to assist with this work. Our price for this work will be $700,000 plus out-of-pocket expenses.
    • Alignment
      • We understand your business strategy intimately from its genesis
      • We quantified the benefits CareFirst can achieve with eCommerce
    • Commitment
      • We worked with your team to scope and structure the work
      • We developed a vision prototype aligned to your strategy
    • Capability
      • We have invested significantly in developing our eCommerce assets
      • We are the largest eCommerce consultant in the business
      • We have worked with 8 out of 10 of the largest health plans
    Why Andersen Consulting?
  • Our eCommerce offerings cover a broad continuum. E-Commerce Strategy Formation Electronic Marketplaces Customer Insight Intentions Value Networks New Business Models Commerce Transformation Electronic Distribution Virtual Corporation Enterprise Process Virtualization New Product Introduction
    • Generate Demand
    • Selling Effectiveness
    • Internet Commerce
    • Fulfill Demand
    • eProcurement
    • Customer Self Service
    • Internet Ordering
    • Plan &
    • Manage
    • Virtual HR
    • Technical Architecture
    • Net Centric Architecture
    • Architecture Assessment
    Information Mgmt Program Management Solution Enablement eCommerce Infrastructure Development
    • Website Creation
    • Planning / Design
    • Construct/ Prototyping
    • Integration / Delivery
    REPRESENTATIVE We place a strong emphasis upon developing leveragable assets to support our clients with advanced thinking in several key areas…
  • eCommerce Overview and Dynamics 11 Proposed Timeline and Team 50 Potential Benefits and Cost 57 Context and Project Objectives 29 Proposed Approach and Deliverables 33 Why Partner with Andersen Consulting? 60 Executive Summary 3
  • Business models are expected to evolve from seller-driven to buyer-driven as the electronic marketplace matures. Nature of Demand Product Intentions Virtual Access and Delivery Method Physical Seller- Driven Model Customer- Centric Model Buyer-Driven Model
    • Buyer-Driven
      • Hybrid Product and Market dynamic, defined by buyer’s intention and measured by wallet share captured
      • Virtual delivery of a network of alliance-sponsored products and services represents a generally leading edge approach to market
    • Customer-Centric
      • Market focused segmentation and differentiation strategies generally characteristic of competitive, near commodity markets
      • Multiple touch points with a bundled product set generally represents today’s mainstream market strategy
    • Seller-Driven
      • Product-focused market strategies generally characteristic of unique, high margin offerings
      • Physical delivery of seller-controlled products and services represents a generally traditional approach to market
    Business Model Options
  • As a consequence, new strategic principles are emerging, changing the old economic assumptions that we have relied upon in the past. Old Assumption Strategic Principle 1. Create a business model with several business partners around a single value proposition eEconomy Assumption Fewer economic constraints on size, complexity and scope of enterprises and enterprise networks Consequence High interaction and collaboration costs drove high levels of vertical integration Low interaction and collaboration costs drive “best of breed” specialization and networked-based value delivery 3. Gain first leader advantage Early market share leadership, once achieved, can lead to dominance Fast followers could leverage learnings of leaders, since diminishing returns to scale limited optimal size of enterprise Increasing returns to scale enables unlimited size of enterprises focused on information components of offerings and channels 2. Generate greater returns on intellectual property and relationship assets Competition is heightened for capturing information and owning customer relationships Return and valuation were derived from bundles of physical assets, intellectual property and customer relationships, but primarily driven by physical assets Return and valuation are derived independently from asset components, with returns primarily driven by intellectual-property and customer relationship assets Strategic Principles in the eEconomy
  • As a consequence, new strategic principles are emerging, changing the old economic assumptions that we have relied upon in the past (cont’d). Old Assumption Strategic Principle 4. Don’t rely on returns based on information asymmetry eEconomy Assumption Margins based on imperfect markets will erode Consequence Returns by producers could be protected by high search and comparison costs incurred by customers Fewer opportunities by producers to capture returns based on price differences for similar goods and services 6. Expand rapidly into markets, in particular, through disintermediation New entrants and fast-moving competitors emerge quickly and capture market share without expanding to build distribution channels Cost and time of entry into markets required creation and coordination of physical assets, means of production and distribution points Virtual presentation of goods and virtual points of sale enable inexpensive and rapid entry into new global markets 5. Expand product diversity and broaden value propositions to buyers Companies, products and business models will cater profitably to smaller customer bases Variety was limited by a segment-level understanding of buyer preferences Declining information and communication costs enable more granular understanding of buyer preferences Strategic Principles in the eEconomy (cont’d)
  • New eCommerce roles are forming and competition to be a recognized player is intense. Large companies are also stepping out of their traditional roles to position themselves in new ways. Emerging eCommerce Roles Access e.g., Netscape Buyer Agency e.g., Amazon.com
    • Search and Evaluation
    • Needs Assessment and Product Matching
    • Product Information Dissemination
    • Purchase Influence
    • Aggregation
    Buyers Sellers Financial/Risk e.g., VISA Fulfillment e.g., FedEx Seller Agency e.g., Equifax Market Making e.g., eBay Access e.g., US Web
    • Integration of Producer and Consumer Needs
    • Market Management
    • Information About Customers
    • Customer Service
    • Aggregation
    • Quality Assurance
    • Product and Service Distribution
    • Customer Service
    • Payment Clearing and Settlement
    • Risk Management
    • Seller Process Support
    • Buyer Process Support
  • The current structure in the healthcare industry presents tremendous opportunity for value creation by moving to an eCommerce-based model.
    • Healthcare is fundamentally an information business
      • Account and member data
      • Network and benefit data
      • Encounter data and clinical history
      • Diagnostic information, treatment paths
      • Medical and pharmaceutical research
    • Information, money, and services must be exchanged across fragmented entities
      • Many diverse participants, including thousands of niche players
      • Dramatic variations in practice patterns and utilization among entities and regions
      • Fragmentation and specialization
      • Complex financial interdependencies
    1 Milliman & Robertson, 1998 data Large number of entities must exchange information, services and money... ...which has proven difficult to do well
    • Healthcare entities still exchange substantial information on paper
      • Reliant on closed, inflexible legacy systems
      • Few information exchange standards
      • Nearly half of health claims are still processed manually and a quarter are so delayed that the claims are filed again 1
    • Healthcare entities are confronted with overwhelming amounts of data and are struggling to glean insight
      • Limited ability to understand and segment consumer wants, needs and behaviors
      • Limited ability to compare providers meaningfully and develop care paths
      • Lack of flexible, evidence-based standards by which to aggregate clinical data and evaluate patient outcomes
  • A large number of new internet-focused companies are moving quickly to populate the healthcare eCommerce space. Abaton.com Access Health Avicenna Systems Axolotl Healtheon Daou Systems iTrust Health Desk Corp. Patient Infosystems Shared Medical Systems Status One Health System Web M.D. Manage Internal Operations Process Transactions Deliver Care Manage Care Manage Provider Network Manage Customer Relationships Manage Products & Risk Market and Acquire Customers Develop Products and Services Advanced Health Covation Claimsnet Kinetra Healtheon Melophis Quadra Med Proxymed MEDE America Araxsys Ariba Technology Concur Technologies Envive IndX Software Luminate Software @Outcome Caresoft Enact Health Mgmt. Systems KnowMed Systems See Appendix for detailed description of services and offerings for these companies. Cerner Network Alchemy Neoforma TIBCO Software Pointshare Officemed.com BroadVision Calico Technology ChannelPoint InsWeb Corporation Siebel Systems Xyber Net
  • These internet-based players are exploiting the eEconomy opportunities by providing eCommerce capabilities in many aspects of the healthcare value chain. Sample of Enablers’ Offerings* *A comprehensive list of new entrants can be found in the Appendix InsWeb Now offers extensive advice and comparison capability for life and auto policies and is expected to add healthcare Covation Facilitates exchange of healthcare information over the internet, e.g., patient enrollment, claims, and medical data Caresoft Offers web-based disease management solutions Shared Medical Systems Offers groupware to streamline workflow across health enterprises iTrust Offers web-based physician practice management solutions Abaton.com Employs web-based software to automate transactions across all classes of healthcare participants Manage Internal Operations Process Transactions Deliver Care Manage Care Manage Provider Network Manage Customer Relationships Manage Products & Risk Market and Acquire Customers Develop Products and Services
  • A number of healthcare online communities have surfaced to serve a spectrum of audiences, ranging from general information seekers to consumers with specific interests. Portals Full Service sites Physician Advice sites Physician-Targeted Sites Type of Online Community Companies
    • Healthfinder
    • HealthGate
    • Medical Networks
    • Medisite
    • Accent Health.com
    • A HN.com
    • iVillage
    • On Health.com
    • Americas Doctor Online
    • BestDoctors.com
    • Sapient Health Network
    • American Health Consultants
    • Medical Economics Company
    • Medical Networks Mediconnect
    • Intelihealth
    • Mediconsult.com
    • Mylifepath.com
    • Third Age
    • Do not contain content per se but instead function as targeted search engines for health information
    • Offer a variety of services including chat rooms, recent medical discoveries, health policy information, product offerings, personalized newsletters and health risk assessments
    • Physician-targeted sites: Contain information of interest to providers, including continuing education courses and journal articles
    • Designed to fulfill a specific informational need for a targeted audience
  • For example, i Village is an online community for women that provides healthcare information through betterhealth.com as one of its many product offerings.
    • Interact
      • Hosts health chat rooms and live health discussions
      • Allows members to send emails to health experts
      • Allows members with similar interests and health concerns to locate one another through a member directory
    • Publish
      • Healthcare library
      • Weekly newsletter
      • Access to MedLine
      • Information for women on many non-healthcare topics
    eCommerce Products
  • Medscape specializes in providing peer-reviewed clinical articles and is an example of an interactive website community for clinicians and consumers.
    • Transact
      • Online bookstore for medical, nursing, and health-science related textbooks
    • Interact
      • Journal scan
      • Email service
      • Medline searches
      • Career center
      • Continuing Medical Information
    • Publish
      • Clinical practice guidelines
    eCommerce Products
  • Health plans are starting to use these enablers, especially to reduce administrative costs. Current Health Plan eCommerce Activities - Admin. Cost Reduction Manage Internal Operations Process Transactions Deliver Care Manage Care Manage Provider Network Manage Customer Relationships Manage Products & Risk Market and Acquire Customers
    • Provide website self-service health plan rate calculation
    • Provide rate quotes for brokers and consultants
    • Enable electronic annual enrollment
    • Use sophisticated data mining/ analysis for pricing and product development
    • Set up recredentialing process on the Internet so paperwork can be submitted online
    • Set up network to disseminate administrative, financial and clinical patient data with providers
    • Post a searchable provider directory on website
    • Order ID cards, change address or PCP on the website
    • Enable member self-service with online access to account information
    • Provide online expert to help physicians resolve claim problems
    • Schedule appointments through the website
    • Communicate health info to physicians and members through the Internet
    • Enable real-time referrals mgmt.
    • Expand electronic claims submission
    • Provide an automated claims adjudication system
    • Enable provider self-service (e.g., referrals, eligibility, claims status)
    • Send payments electronically to providers
    • Enable online purchasing of insurance
    • Use automated antifraud solutions to reduce suspect claims and run fraud audits
    • Install a coherent enterprise management system
    • Post employment listings on the web
    • Publish internal policies and procedures on an intranet
    Develop Products and Services
  • In addition to administrative cost reduction, health plans are also leveraging eCommerce technology companies to reduce the cost of care. Current Health Plan eCommerce Activities - Care Cost Reduction
    • Profile providers
    • Use triage systems in conjunction with an EMR for demand management
    • List clinical guidelines online
    • Offer an online physician newsletter (e.g., info on disease management programs)
    • Use data mining to identify people who are susceptible to certain illnesses
    • Provide healthcare information to members
    • Provide risk assessments and wellness advice to members
    • Provide an online drug formulary
    Manage Internal Operations Process Transactions Deliver Care Manage Care Manage Provider Network Manage Customer Relationships Manage Products & Risk Market and Acquire Customers Develop Products and Services
  • Although revenue enhancement is the major play, there are only a few health plans currently implementing initiatives to achieve this objective. Current Health Plan eCommerce Activities - Revenue Enhancements
    • Offer marketing and enrollment information on websites
    • Engage in data mining to target appropriate customers
    • Provide tailored risk assessments and advice on website to maintain loyalty
    • Provide customized health related web pages for Members
    • Offer Internet solutions to sell and distribute health insurance online
    • Create cross industry destinations and portals (e.g., mylifepath.com)
    Manage Internal Operations Process Transactions Deliver Care Manage Care Manage Provider Network Manage Customer Relationships Manage Products & Risk Market and Acquire Customers Develop Products and Services
  • Blue Shield of California’s mylifepath.com offers consumers personalized health information.
    • Features
      • Personalized health and wellness information on fitness and nutrition, parenting, women’s health, pregnancy, and alternative health
      • Discounts on mylifepath alternative health and wellness services, such as nutrition counselors, massage, yoga classes, acupuncture, exercise classes, etc.
      • Reference materials and screened site links to health and wellness information
      • Savings on health and wellness products (baby supplies, books, etc.)
      • Interaction with Blue Shield of California
    • Blue Shield Role
      • Content provider — provide consumer-focused information and content organization
      • Integrator — partner with BabyCenter, Barnes & Noble, Fogdog Sports as well as numerous alternative and traditional healthcare practitioners to provide intentions-focused experience
  • United Healthcare is using eCommerce to streamline administrative processes and manage customer relationships.
    • Website
      • Offers customized lifestyle appraisals
      • Provides a searchable provider directory
      • Plans on expanding website capabilities by:
        • Creating customized web pages for members based on their specified interests
        • Enabling members/benefits managers self-service with online access to account information
    • ChannelPoint
      • Piloting a ChannelPoint product to automate process of selling health insurance
      • Will handle price quotes, underwriting, rating and other tasks with ChannelPoint solution
    • Back Office
      • Uses data mining to identify members susceptible to certain illness and to identify unusual healthcare utilization patterns
      • Will install computer workstations that enable customer services agents to quickly access membership information
      • Plans to offer an automated adjudication system
    eCommerce Activities
  • With few notable exceptions such as United and Aetna, no one has made a major entry into the eCommerce space; however, all are poised to do so. Approximate eCommerce Position of Health Plans* * Top nine by membership Conservative Aggressive
  • Nonetheless, most healthcare players have not formed a coherent eCommerce strategy.
    • Large plans and provider organizations are distracted by operating concerns and are experiencing unprecedented financial difficulties, due in part to acquisition integration challenges and difficulty sustaining earlier gains in controlling medical costs
      • Companies are focusing on “doing the basics right” to regain profitability and improve service performance
      • Health plans and providers are also increasingly absorbed with dissatisfied stakeholders, including more demanding members/patients, more sophisticated purchasers and more activist legislators
      • IT staffs are distracted by Y2K and overwhelmed by demands to absorb new technologies
    • Health plans are reacting to the opportunities and competitive pressure presented by the advent of eCommerce and have not taken the time to chart their course in the future market environment
  • eCommerce Overview and Dynamics 11 Proposed Timeline and Team 50 Potential Benefits and Cost 57 Context and Project Objectives 29 Proposed Approach and Deliverables 33 Why Partner with Andersen Consulting? 60 Executive Summary 3
  • Several business issues drive the need to accelerate eCommerce capabilities.
    • CareFirst has developed an eCommerce strategy overview and white paper which describe desired eCapabilities
    • This project is designed to take that work to the next level
    • There is a strong need for customers to perceive CareFirst’s innovation capabilities and differentiation through eCommerce
    • The newly-developed business strategy requires eCommerce capabilities to support geographic dominance, consumer-centric focus, and to more quickly integrate acquired businesses
    • There is a desire to “productize” technology capabilities and link them with marketing messages
    Project Context
  • This project is designed to begin rolling out eCommerce capabilities to constituents as quickly as possible.
    • To confirm and augment the concepts of the existing eCommerce strategy and to choose the highest-value eCapabilities
    • To design the high-level business, technical and security architectures required to support eCapabilities and scale them up as demand increases
    • To lay out a business case and game plan for quickly rolling out eCapabilities to each constituent (members, providers, brokers and purchasers)
    • Understand the business, technical and political implications of the strategy
    Detailed Project Objectives
  • The eCommerce strategy touches many components of the overall IT blueprint. Overall IT Strategy eCommerce Strategy Business Processes Information Applications IT Infrastructure IT Architecture Business Enables Drives Information Technology IT Alignment with Business IT Management & Delivery Leadership Sourcing Structure & Governance Processes
  • eCommerce Overview and Dynamics 11 Proposed Timeline and Team 50 Potential Benefits and Cost 57 Context and Project Objectives 29 Proposed Approach and Deliverables 33 Why Partner with Andersen Consulting? 60 Executive Summary 3
  • Winning requires a different strategy from traditional investments. 1999 2000 2001 2002 eCommerce Performance 2
    • Minimize risk of disruption to cost containment, merger integration and Y2K efforts
    • Demonstrate proof-of-concept
    • “ Reserve the right to play” where major uncertainty exists
    • Introduce simple, quick experiments
    Start Small
    • Scale quickly to protect existing customers
    • Leverage new enablers alongside current technology
    • Acquire customers through new value propositions, speed and excellence of execution
    • Exploit new technology mid-ware to connect legacy applications
    3
    • Determine implications of possible market outcomes
    • Identify actions to move market to preferred outcomes and to make the best of other outcomes
    • Develop a flexible roadmap
    1 Years Scale Fast Think Big
  • New management approaches are also needed to win in the eCommerce space.
    • Piecemeal efforts by marketing (website) and IT (EDI)
    • Director-level commitment
    • Cross-functional strategic initiatives
    • Aligned incentives
    • Executive team commitment
    • Months planning the “best” solution
    • Safe bets only
    • Funded from operating budgets for same-year payback
    • A portfolio of experiments
    • Mix of quick hits, capability builders and option plays
    • Shareholder value, return on investment
    • Focus on automating current business processes
    • Local market autonomy
    • Re-invention of administrative processes, care management processes and revenue generation
    • Corporate franchise development
    Typical Winning
    • Existing business units
    • Entrepreneurial ventures that can grow rapidly and be owned flexibly
  • We propose a two-phase approach which will deliver capabilities to the marketplace by 4Q99.
    • Pinpoint eCommerce implications from business strategy
    • Identify successful external eCapability examples to supplement existing eStrategy
    • Identify potential external content or eCapability alliance partners
    • Assess CareFirst’s market demographics and constituents’ potential use of the eCapabilities defined
    • Perform data and call volume analyses to gauge value priorities across providers, consumers, brokers and purchasers
    • Adjust existing eStrategy documents based on emerging ideas and business drivers
    • Enhance eVision prototype demonstration to showcase potential eCapabilities
    • Develop and use evaluation framework to prioritize eCapabilities based on business value, cost, technology implications, business strategy linkages and potential constituent political implications
    Design eArchitecture Design short- and long-term development and run-time environments Set eVision Quickly determine the highest-value opportunities considering impacts on business value, cost, technology, business strategy and constituent politics
    • Develop conceptual design of development, execution and operations environments in the context of existing infrastructure (short-term and long-term)
    • Identify scalability constraints in the execution environment
    • Design high-level security architecture for short- and long-term execution environment
    • Identify implications to overall IT strategy and IT Blueprint
    Phase 1 Approach = Scope of this document Plan Rollout Develop business case and plan rollout timeline and approach
    • Specify organization, skills and sourcing strategy required to launch and sustain both the eArchitecture and selected eCapabilities
    • Develop business case for investments (including high-level FTE and capital budget estimates for FY99 and FY00)
    • Develop implementation plan and timeline for eCapability rollout
    • Develop assumptions and technical risks documents
    3 Weeks 6 Weeks 3 Weeks Launch Pilots Begin delivering capabilities while laying critical infrastructure Adjust Speed Continuously evaluate progress and adjust speed of investments Scale Fast Assure that infrastructure can support unexpected growth Phase 2 Launch Pilots Adjust Speed Scale Fast
  • Deliverables include choosing priority initiatives, developing the conceptual design of the new architecture, and planning the rollout.
    • Prioritized set of eCapabilities, including business drivers, constituent input and key issues to be addressed
    • Market assessment of potential consumer/ provider uptake of eCapabilities in CareFirst’s markets by segment or product
    • Market scan summary of competitors and potential content or eCapability alliance partners
    • Enhanced eVision prototype demonstration
    Set eVision Quickly determine the highest-value opportunities considering impacts on business value, cost, technology, business strategy and constituent politics Design eArchitecture Design short- and long-term development and run-time environments
    • Conceptual design for development, execution and operations environments, including security architecture and scalability constraints
    • IT strategy, IT blueprint and business architecture change implications discussion document
    Phase 1 Summary Deliverables Plan Rollout Develop business case and plan rollout timeline and approach
    • eCommerce organization chart, list of key skills required, and sourcing strategy
    • Executive-level business case, including timeline, resource requirements and high-level costs and benefits
    • Assumptions, technical risks and political risks documents
    3 Weeks 6 Weeks 3 Weeks
  • Phase IA will identify the highest value opportunities.
    • Pinpoint eCommerce implications from business strategy
    • Identify successful external eCapability examples to supplement existing eStrategy
    • Identify potential external content or eCapability alliance partners
    • Assess CareFirst’s market demographics and constituents’ potential use of the eCapabilities defined
    • Perform data and call volume analyses to gauge value priorities across providers, consumers, brokers and purchasers
    • Adjust existing eStrategy documents based on emerging ideas and business drivers
    • Enhance eVision prototype demonstration to showcase potential eCapabilities
    • Develop and use evaluation framework to prioritize eCapabilities based on business value, cost, technology implications, business strategy linkages and potential constituent political implications
    Key Activities Key Deliverables
    • Prioritized set of eCapabilities and key functionality that will be delivered to the marketplace. These will be shown as capabilities linked to each constituent (providers, members, purchasers and brokers)
    • Market assessment of potential consumer/ provider uptake of eCapabilities in CareFirst’s markets by segment or product
    • Market scan summary of competitors and potential content or eCapability alliance partners
    • Enhanced demonstration to showcase eVision capabilities
    Set eVision Quickly determine the highest-value opportunities considering impacts on business value, cost, technology, business strategy and constituent politics
  • Phase 1B will create the conceptual design for CareFirst’s net-centric architecture. Design eArchitecture Design short- and long-term development and run-time environments
    • Develop conceptual design of development, execution and operations environments in the context of existing infrastructure (short-term and long-term)
    • Identify scalability constraints in the execution environment
    • Design high-level security architecture for short- and long-term execution environment
    • Identify implications to overall IT strategy and IT Blueprint
    Key Activities Key Deliverables
    • Conceptual design for development, execution and operations environments, including security architecture and scalability constraints
      • Architecture component analysis
      • Physical environment blueprint
      • Interface and connectivity diagram
      • Application component diagram
      • Component interaction diagram
      • Technical architecture requirements
    • IT strategy, IT blueprint and business architecture change implications discussion document
  • Phase 1C will prove the value and lay out the plan. Plan Rollout Develop business case and plan rollout timeline and approach
    • Specify organization, skills and sourcing strategy required to launch and sustain both the eArchitecture and selected eCapabilities
    • Develop business case for investments (including high-level FTE and capital budget estimates for FY99 and FY00)
    • Develop implementation plan and timeline for eCapability rollout
    Key Activities Key Deliverables
    • eCommerce organization chart, list of key skills required, and sourcing strategy
    • Executive-level business case, including timeline, resource requirements and high-level costs and benefits
    • Assumptions, technical risks and political risks documents
  • The scope and plan for Phase 2 will evolve as eCapabilities are identified; some potential components are shown below. Phase 2
    • Develop and launch initial eCapability projects with 60- to 90-day debuts
    • Experiment with some eCapabilities to test value or sustainable differentiation
    • Pilot the eCapabilities with select groups of members, purchasers, physician offices, and/or administrators
    • Begin laying critical infrastructure components to prepare for required eEnablement and scalability
    • Set specific timelines for project value assessments, as drug companies do in their research projects
    • Stop projects which haven’t proven out; speed up others that show promise
    • Continually innovate with new capabilities
    • Continue infrastructure investments to enable further automation and interactivity
    Launch Pilots Begin experimenting with capabilities while laying critical infrastructure Adjust Speed Continuously evaluate progress and adjust speed of investments
    • Continue infrastructure investments to enable further automation and interactivity
    • Over-size to stay ahead of market demand
    Scale Fast Assure that infrastructure can support unexpected growth Launch Pilots Adjust Speed Scale Fast
  • Opportunities will be identified and evaluated using proven frameworks. Identify Opportunities (“Stretch your imagination”) Employers/ Groups Members Providers Trading Partners Federal & State Government Brokers & Agents Evaluate Opportunities (“Balance the assessment”)
    • Alignment with Business Strategy
    • Quantitative criteria (e.g.,. revenue potential, ROI)
    • Qualitative criteria (e.g., competitive threat, customer need, sustainability)
    Classify Opportunities (“Make tough decisions”) Sustainable Differentiation Value to Constituent
    • Think in terms of communities rather than value chain activities
    • Assess today’s realities and try to envision future possibilities
    • Understand where others inside and outside the industry are heading
    • Strategic eCommerce Opportunities impact with:
      • Members, Providers and Partners
      • Administrative Staff
      • Consumers
      • Etc.
    Current Business Models Enhanced Business Models New Business Models eC Value Potential Investment Risk . . . Opportunity 1 Opportunity 2 Opportunity 4 Opportunity 3 I II III IV . . . Sample Deliverables
  • Our approach will deliver a strategy that is logically integrated with CareFirst’s business strategy which we are jointly developing, not just a set of initiatives. Low Low High High Long-Term Contribution to Strategic Direction Short-Term Business Case . Framework for Prioritizing eCommerce Initiatives . . . . . . . . . . . . . . . . . . More Aggressive Strategy More Conservative Strategy . Initiatives Sample Deliverables
  • A net-centric technical infrastructure is complex and requires significant new technology; this project will deliver the conceptual design for this architecture. Illustrative Net-Centric Architecture Communication Fabric Transport Services Massage Transport Transport Security Packet Forwarding/ Internetworking Circuit Switching Network Address Allocation Quality of Service Network Media Services Media Access Physical Media Communications Security Environment Runtime Services Language Interpreter Virtual Machine System Services System Security Profile Management Environment Verification Task & Memory Management Application Services Application Security Error Handling/ Logging State Management Active Help Other Common Services Component Framework Operating System Codes Table Services File Services App. Integration Interface Base Services Web Server Services Batch Services Workflow Services Push/Pull Services Report Services Presentation Window System Desktop Manager Form User Navigation Web Browser Report & Print Direct Manipulation Input Device Business Logic Interface Application Logic Data Abstraction Information Database Services Document Services Replication/Synchronization Versioning Access Security Indexing Storage Messaging Encryption email Core Specialized Virtual Resources Fax Terminal File Sharing Printing Paging Audio/Video Phone Authorization Authentication ORB CTI EDI Legacy Integration Directory Services Domain Name Communication Transaction Resource Management Transaction Management Transaction Partitioning TP Monitor File Transfer RPC Msg Oriented Streaming email Database Access Sample Deliverables
  • CareFirst’s security architecture will be developed in the context of Andersen Consulting’s Security in eCommerce™ implementation guide.
    • Applications
    • Components
    • Menu of Choices
    • Product Mapping
    Sample Deliverables
  • A conceptual technical architecture design identifies the architecture components and technologies required to support a given solution. Requirements / Assessment Architecture Assessment: Technical Architecture Relevant Systems NT Gateway Server 1. Windows NT 2. Falcon MQ Bridge 3. Falcon MQ Server 4. MSMQ 5. SNA Server Illustrative Technical Architecture Design LAN/ WAN/ Internet LAN/ WAN Unix Server 1. AIX 2. TransAccess 3. U to A 4. Entera 5. MQ Series 6. CORBA 7. Web Server 8. SNA Server 9. RDBMS IBM ES/9000 Mainframe 1. MVS 2. CICS 3. IMS 4. MQ Series 5. TransAccess 6. Database (DB2,VSAM, IMS) NT Server 1. Windows NT 2. TransAccess 3. NT to A 4. MSMQ 5. CORBA 6. Web Server 7. MQ Series 8. RDBMS UNISYS A-Series Mainframe 1. MCP 2. COMS 3. A to U 4. U to A 5. A to A 6. NT to A 7. Falcon MQ Client 8. Database (DMSII) Windows Workstation 1. Windows 95/NT 2. Entera 3. CORBA 4. MSMQ 5. Browser LAN/ WAN LAN/ WAN/ Internet Sample Deliverables
  • An interface and connectivity diagram presents underlying protocols and interface technologies employed. Requirements / Assessment Architecture Assessment: Interfaces & Connectivity NT to A MSMQ NT Server TransAccess CORBA Web Server A to U Falcon MQ Client U to A UNISYS A-Series Mainframe COMS RDBMS Interface Legend Available Under Construction Future MSMQ Windows Workstation Entera CORBA Browser Entera RPC MSMQ DCOM/ ActiveX IIOP HTTPS MSMQ DCOM/ ActiveX IIOP HTTPS BNA Terminal U to A Entera MQ Series Unix Server TransAccess CORBA Web Server RDBMS Entera RPC DCOM/ ActiveX IIOP HTTPS U to A RPC ODBC MQ Series TransAccess RPC A to A NT to A TransAccess MQ Series IBM ES9000 Mainframe CICS IMS DDCS (DB2) Cedar/LU6.2 MQ Series TransAccess RPC 3270/LU2 NT Server Falcon MQ Server SNA Server MSMQ Falcon MQ Bridge MS RPC ODBC MSMQ TransAccess RPC MS RPC ODBC U to A RPC Falcon MQ MQ Series MQ Series Illustrative Interface and Connectivity Diagram DMSII Database Database DB2 VSAM IMS Sample Deliverables
  • A physical environment blueprint communicates the physical topology including computers and network components. Gateway Server IBM ES/9000 Mainframe UNISYS A-Series Mainframe LAN Conceptual Design Infrastructure & Application Blueprints: Physical Environment Blueprint Application Data Center Server Relevant Systems Producers (External) Remote Sites Company A Fax Machine Illustrative Interface and Connectivity Diagram Workstation Scan Station Producer Desktop Unix Server NT Server User Workstation LAN/ WAN/ Intranet Integration Framework Server WAN Application Server (Master) WAN Firewall Internet LAN WAN LAN/ WAN Application Server (Slave) LAN/ WAN Sample Deliverables
  • A process and information flow diagram shows how data and processes supporting business operations flow through the solution architecture. Process & Information Flows: Release 1 Process Flow Requirements / Assessment New Producer Application Update Rate Tables Manual Processing Network Match Engine Scrub Group Structure Manual Group Entry H H H Same Process RFP Fax Enrollment Upload Producer Info Note: All flows from the Integration Framework have a corresponding confirmation feedback loop to Internet Arch. . These feedback loops are not depicted in the diagram. J J Illustrative Process and Information Flow Legacy Systems Broker Scan CP Employer Application & Member Enrollment L2 L1 Case Installation & Member Enrollment Group Installation Sales Reporting Scrub Medical Underwriting Install Case Producer Application Member Enrollment DB2 DMSII File/Report Database Process User Input Memory Cache L3 New Producer Processing Census DB2 Rating Engine L4 Interface Services Interface Engines Rating Engine Faxback Proposal Proposal Generator Process RFP Integration Framework Internet Framework Sample Deliverables
  • eCommerce Overview and Dynamics 11 Proposed Timeline and Team 50 Potential Benefits and Cost 57 Context and Project Objectives 29 Proposed Approach and Deliverables 33 Why Partner with Andersen Consulting? 60 Executive Summary 3
  • The project will take between 11 and 12 weeks to complete, based on level of detail of the architectures developed. High-Level Project Workplan 1 2 3 4 5 6 7 8 9 10 11 12 Week: Worksteps 2 3 4
    • Phase 1A
    • Pinpoint eCommerce implications from business strategy
    • Research external eCapabilities / partners
    • Assess CareFirst’s eMarket demographics
    • Perform data and call volume analyses
    • Enhance eVision prototype
    • Prioritize eCapabilities
    • Phase 1B
    • Design high-level architecture
    • Design high-level security architecture
    • Identify IT Blueprint implications
    • Phase 1C
    • Specify organization, skills and sourcing strategy
    • Develop business case & implications
    • Develop implementation plans & next steps
    = Progress Review 1
  • At each project checkpoint, there may be separate business and technical reviews with different audiences.
    • Set Business Context
      • Refine project scope, timeline and business resource commitments
      • Review eMarket demographics for CareFirst’s markets
      • Brainstorm prioritization criteria
    • Review Business Analysis/Partners
      • Review eMarket research and eCapability options identified to date
      • Review and set direction on potential eCapabilities and partners
      • Set preliminary business priorities
    • Confirm Priorities & Business Case
      • Confirm and set final priorities
      • Review business case
    • Set Technical Context
      • Refine project scope, timeline, deliverables and technical resource commitments
      • Identify potential target technical environments to address
    • Refine Technical Architecture
      • Review design options and determine straw model architecture to design further
      • Refine straw model architecture with input from broader IT team
    • Finalize Architectures
      • Perform technical review of chosen architectures, tools, etc.
      • Identify initial IT Blueprint implications
    2 3 4 1 Business Reviews Technical Reviews 2 3 1
    • Approve Implementation Plans and Next Steps
      • Review and adjust implementation timelines, costs and benefits
      • Approve overall strategy and set business and technical roll out plans in place
    Joint Review
  • The project would be a joint effort between CareFirst and Andersen Consulting. Project Organization Project Executives
    • TBD (CareFirst)
    • Michael Palmer (AC)
    Key Content Experts and Management
    • Key Architect (CareFirst)
    • Jay Phillips (AC)
    • Healthcare Manager TBD (AC)
    Design, Analysis and Business Case Team
    • Access to CareFirst’s customer service, information technology and other business executives
    • IT analyst (CareFirst)
    • Consultants (Andersen Consulting)
    Project Sponsors & Steering Committee
    • Bill Jews (CareFirst)
    • Dave Astar (CareFirst)
    • Tom Rekart (CareFirst)
    • Jim Hudak (AC)
    Expert Advisors
    • Kedrick Adkins (AC)
    • Joe Marabito (AC)
    • Brian Johnson (AC)
    • Bill Milleker (AC)
  • We would drive the results of the project through a small staff who would be responsible for all architecture development, research and business case development. Key Content Experts and Management Design, Analysis and Business Case Team Expert Advisors
    • Design future conceptual architecture
    • Conduct interviews
    • Ensure delivery of analysis
    • Provide direction and input
    • Manage issue identification and resolution
    • Develop detailed designs
    • Conduct interviews
    • Draft written reports
    • Formulate and conduct analysis
    • Research issues and hypotheses
    • Develop business case
    Role
    • Lend direction, experience
    • Provide in-depth point expertise
    • Challenge thinking, assumptions
    • Full time
    • 30 days
    • Full time
    • Full time
    • 2-3 days/week
    • Full time
    • Full time
    Time Commitment
    • Brainstorming sessions
    • Ad hoc, as needed
    • Jay Phillips (AC) - Architect, Lead Manager
    • 1 AC Application Expert, Manager
    • 1 CareFirst Key Architect
    • 1 CareFirst IT Applications Analyst
    • 1 CareFirst End-User Analyst
    • 1 AC Tech Consultant
    • 1 AC Business Analyst
    Staffing
    • As needed and available
    Project Staffing Project Executives
    • Provide overall project direction
    • Lead strategy development
    • Lead business case design
    • Four days/week
    • 2-3 days/week
    • Michael Palmer - Project Leader
    • 1 CareFirst Project Leader
    Project Sponsors
    • Make interim and final decisions on capabilities and direction
    • 1-2 hours/week
    • 3-8 hours/week
    • Bill Jews
    • Dave Astar, Tom Rekart, Jim Hudak
  • The CEO’s role is critical to selecting the right eCapabilities and partnerships to pursue, addressing any board or constituent concerns, and setting the tone for cultural change.
    • Participate in steering committee meetings
    • Provide input on prioritization criteria and lead the selection of eCapabilities
    • Provide guidance on political considerations regarding CareFirst constituents (providers, members, legislators, brokers, purchasers) and work with these constituents as necessary to set direction
    • Choose and approve any recommended partnerships for either eCapabilities or content
    • Make resource decisions regarding CareFirst team member priorities
    • Set tone for CareFirst’s overall cultural change by becoming more informed about eCommerce and advocating its use where appropriate
    During the project, Bill Jews should play a critical role in several areas, dedicating a recommended one to two hours per week. Suggested areas for participation include:
  • Andersen Consulting is prepared to deliver some of our most experienced and talented individuals to participate in the project*.
    • James B. Hudak
    Name Comments/Areas of Experience
    • Kedrick D. Adkins
    • Brian A. Johnson
    • Michael E. Palmer
    • Global Managing Partner for Andersen Consulting’s Health Services Practice
    • Directed engagements for clients to develop overall business strategies, consumer-focused strategies, eCommerce strategies, growth strategies and operational improvement strategies
    • Americas Managing Partner for Andersen Consulting’s Health Services Line of Business
    • Led several infrastructure consolidation and new age architecture projects
    • Expert in managed care systems and architectures
    • Partner in Andersen Consulting’s Financial Services practice
    • Led engagement to assist very large health plans develop eCommerce strategies and implementation plans
    • Associate Partner and East Coast Leader of Andersen Consulting’s Healthcare Strategic IT Effectiveness Line of Business
    • Led several engagements in developing eCommerce strategies and architectures for several major health plans and provider organizations
    • Expert in IT management and delivery in traditional and net-centric environments
    * Subject to availability
    • Jay Phillips
    • Manager in Andersen Consulting’s Financial Services Solution Center
    • Led several architecture development initiatives within healthcare, banking and insurance
    • Expert in net-centric architectures (CORBA, CJB, etc.) including integrating mainframe back-end systems
  • eCommerce Overview and Dynamics 11 Proposed Timeline and Team 50 Potential Benefits and Cost 57 Context and Project Objectives 29 Proposed Approach and Deliverables 33 Why Partner with Andersen Consulting? 60 Executive Summary 3
  • The right strategies can yield significant economic benefits along with service improvements.
    • 0.5-1.0% savings in medical costs through profiling and channeling
    • 1-2% reduction in drug spend through using online formulary
    • 0.5-1.5% savings in medical costs through use of proven pathways
    • 10-20% savings on high-dollar cases with early detection/ intervention
    • 10-15% improved outcomes with patient therapy compliance (on base of 17% of hospital costs)
    • 3-6% decrease in voluntary disenrollment through customized service
    • 1-3% increase in commissioned sales
    • $3-4 per member per month increase in revenues for 20-30% of membership
    Enhance Revenue Reduce Costs Reduce Non-Care Related Costs Reduce Care Related Costs Reduce G&A and Purchasing Costs Reduce Network Management Costs Potential eCommerce Benefits Attract/Retain More Members Channel Utilization Through “Best” Providers Provide Electronic Formulary, Pathways, etc. Perform Real-Time Disease/Case Management Improve Patient Compliance & Self-Care Expand Share of Each Customer Participate in Virtual Networks & Tailor Individual Offerings Improve Sales Success Rate Through Real-Time Quotes Enable Member Self-Service Enable Provider Self-Service (Eligibility, Claims, Referrals) Expand Range of Products & Services Expand Value Delivered to Each Stakeholder Lower Marketing, Selling & Distribution Costs Lower Enrollment Cost e Commerce Economic Value Tree
    • $?? Launch an eBusiness to exploit current assets (information, medical knowledge, etc.)
    • 12-35% reduction in cost of group processing
    • 3-6% reduction or elimination of commercial commissions
    • 10-15% fewer employer/member service phone calls
    • 30-40% increase in professional electronic claims; little investment
    • 50% reduction in referral processing cost; improved service
    • 30-40% fewer provider service phone calls
    • 3-15% savings in supply spending through eProcurement
    • 2-3% claims cost savings for using common claims infrastructure
    • 30-40% savings of recredentialing costs
    • 10-25% decrease in enrollment processing costs
    I LLUSTRATIVE
  • Conservatively estimated, CareFirst’s potential annual cost savings and revenue enhancements through investments in eCommerce could total over $100MM*. Our price for Phase 1 will be $700,000 plus out-of-pocket expenses. Potential Revenue Enhancement* = $38.5MM Potential Care Related Savings* = $90MM Potential Non-Care Related Savings* = $9.1MM Total Potential Value > $100MM * Detailed estimates and assumptions available upon request.
  • eCommerce Overview and Dynamics 11 Proposed Timeline and Team 50 Potential Benefits and Cost 57 Context and Project Objectives 29 Proposed Approach and Deliverables 33 Why Partner with Andersen Consulting? 60 Executive Summary 3
  • Andersen Consulting is uniquely qualified to assist with this work.
    • Alignment
      • We understand your business strategy intimately from its genesis
      • We quantified the benefits CareFirst can achieve with eCommerce
    • Commitment
      • We worked with your team to scope and structure the work
      • We developed a vision prototype aligned to your strategy
    • Capability
      • We have invested significantly in developing our eCommerce assets
      • We are the largest eCommerce consultant in the business
      • We have worked with 8 out of 10 of the largest health plans
    Why Andersen Consulting?
  • Andersen Consulting is currently ranked #1 among all world-class internet services firms. Source: International Data Corporation, December, 1998
  • The Analysts Agree....
    • “ Andersen Consulting is now the undisputed world leader in consulting on systems integration.” - Fortune Magazine
    • “ Andersen Consulting towers above the rest of the field and has distanced itself further from its rivals.” - Management Consultancy
    • Andersen Consulting’s emphasis on integrating strategy, technology, process and change management skills is helping clients overcome the chaos caused by shifting markets and rapidly changing technology” - Client Server Computing
    • “ [Andersen is] exemplary of the global, decentralized, knowledge-sharing organization. They are among the best I’ve run into.” - James Brian Quinn, Author of Intelligent Enterprise
    • “ [Andersen Consulting] can’t seem to do anything wrong...[it] experiences significant growth worldwide, retains its clients and always retools a step ahead without missing a beat.” - Datamation
    • “ Andersen Consulting remains lean and hungry and is not resting on any of the laurels it has won.” - INPUT
    • “ [Andersen Consulting is] one of the few firms that all other competitors in the market, large and small, aspire to beat for client engagements” - Gartner Group
  • Our eCommerce offerings cover a broad continuum. E-Commerce Strategy Formation Electronic Marketplaces Customer Insight Intentions Value Networks New Business Models Commerce Transformation Electronic Distribution Virtual Corporation Enterprise Process Virtualization New Product Introduction
    • Generate Demand
    • Selling Effectiveness
    • Internet Commerce
    • Fulfill Demand
    • eProcurement
    • Customer Self Service
    • Internet Ordering
    • Plan &
    • Manage
    • Virtual HR
    • Technical Architecture
    • Net Centric Architecture
    • Architecture Assessment
    Information Mgmt Program Management Solution Enablement eCommerce Infrastructure Development
    • Website Creation
    • Planning / Design
    • Construct/ Prototyping
    • Integration / Delivery
    REPRESENTATIVE We place a strong emphasis upon developing leveragable assets to support our clients with advanced thinking in several key areas…
  • We have a broad range of experience helping organizations shape and implement eCommerce Strategies.
    • We have worked with leading healthcare organizations including traditional health insurance and managed care organizations and new entrants
    • We have also worked with leaders in other industries including financial services, pharmaceuticals, automotive, high technology and consumer electronics
    • We are participating directly in the eEconomy through our investment in, and operation of our own eCommerce businesses
    • We continue to invest in our own capabilities to help our clients succeed in their eCommerce initiatives
    Our Experience
  • We have worked with leading healthcare organizations to improve efficiency, service and quality of care using eCommerce. For this regional managed care organization, we created a web-enabled referral process that links the health plan with its network of primary care physicians and specialists. Referral processing time was reduced from days to minutes, with corresponding improvements in efficiency and provider relationships Health Alliance Plan For a national managed care organization, we are implementing a web-based solution to assist marketing to individuals and small groups. The solution assists both brokers, employers and individuals in requesting quotes, delivering proposals and signing business quickly and more efficiently National Managed Care Organization For this provider of eCommerce infrastructure and services, we developed a web-enabled solution to support eligibility, enrollment, referrals, claims and payments. We also worked with Covation to implement technical and physical security and fault tolerance features for all of their IT utility based services Covation (PhyCor, NationsBank and AC Joint Venture) For this electronic insurance market maker, we developed a health insurance entry strategy. We examined and prioritized potential products for individual, small group and senior markets. We identified appropriate carriers to provide products, developed pricing strategies and created implementation plans Internet Marketplace For this state university system, we identified opportunities for the health and academic components to use internet and multi-media technology to support telemedicine, clinical research and health education. We defined new governance structures for the components to cooperatively invest in technology to support the University’s electronic campus initiative. University of Texas
  • We have also worked with leading organizations in other industries to develop eCommerce strategies and implement internet-enabled business capabilities. For Toyota, we developed the vision and internet presence strategy, focusing on sales and customer satisfaction. The site will allow customers to view nationwide inventory, conduct the vehicle purchase (using the dealer as needed), and manage ownership of the vehicle in a customized way. Benefits will be increased sales close rates and more efficient use of dealerships. Toyota This internet software provider chose us as a development partner to build their web-based software sales and distribution retailing storefront. The site allows customers to download and “test drive” software products and make purchases. Leading Internet Software Provider For First Union, we developed an internet solution to provide electronic banking services to customers. The solution provides real time access to legacy system data and supports customer service functions previously provided by telephone. First Union will use these capabilities to differentiate itself as a technology leader and to reduce service costs. First Union National Bank We developed the internet strategy for this pharmaceutical company, focusing on corporate identity, patient education, on-line product information, and corporate intranet applications. The benefits include marketing, training and information delivery costs, and improved communications with stakeholders. Large Pharmaceutical Company For Toshiba, we developed and implemented an internet strategy to reduce costs, increase sales and improve customer service. Benefits include reduced publishing and distribution costs by 70-80%, reduced phone support costs, and increased sales through reduced time to get product information to customers. Toshiba America Electronic Components
  • We have a significant number of eCommerce clients across multiple industries. Wallace Abbott Pepsi
  • We are participating directly in the eEconomy through our investment in, and operation of our own eCommerce businesses. Covation is a joint venture with Bank of America (formerly NationsBank) to provide an eCommerce infrastructure to support healthcare administrative transaction processing. Covation Qpass is an internet service enabler that provides a payment solution for web-based retailing, specifically to facilitate small ticket sales of digital content. We developed the business model and products and are a part owner of this venture Qpass ViaWorld is an internal service organization that provides internet access to Andersen Consulting travelers to book and modify airline reservations. ViaWorld includes direct web and voice access and has reduced our cost for agency commissions and computer reservation system usage. ViaWorld Services We are an investor and business partner for this provider of internet-based distribution solutions for healthcare insurance. As part of our partnership, we assist ChannelPoint clients with business process design, systems integration and implementation. ChannelPoint iFlourish.com is a pure play internet portal we are in the process of launching. This company will offer an intentions-based package of goods and services targeted at active consumers aged 45 and over. iFlourish.com
  • To ensure that we bring best practices and thought leadership, we invest in high-impact R&D. Selected eCommerce R&D Areas Facility where visitors can see and experience the most exciting new ideas in the financial services industry “ Think tank” and client working center focused on specific and contemporary business change issues Center that focuses on delivering Internet solutions including strategy, prototyping and development capabilities Center focused on identifying, evaluating, and integrating technologies to drive business opportunities Workshops to educate industry executives on the strategic applications of advanced technology State-of-the-art digital media production facility dedicated to rapid application prototyping and proof of implementation Development centre focused on creating Internet, multimedia, and component-based solutions Joint venture with BBN to provide Internet-related infrastructure services Financial Ideas Exchange… Institute for Strategic Change... Internet Centers of Excellence (ICE)… Center for Strategic Technology Research (CSTaR ® ) … DAVINCI Virtual Corporation… Emerging Technologies Lab… FinancialWorks… ServiceNet… (The following pages provide an overview of some of these areas)
    • The Ideas Exchange, which opened in autumn 1995 in New York, is a financial and health services industry research and development center
    • The Exchange provides a setting for exploring trends and solutions for tomorrow’s business environment and discussing how to transform their organizations supported by the most up-to-date research, presentation technology, and benchmarking information
    • At the Exchange, senior executives can explore new ideas and approaches to keep pace with the changing health and financial services marketplaces. A showcase of innovation in serving customers, the Exchange tangibly brings to life ‘what will soon be possible and what financial/health services and market leaders must currently plan for.’ Drawing on its worldwide base of knowledge capital, industry expertise and proven solutions, Andersen Consulting uses the Exchange to demonstrate how to successfully implement innovative responses to market opportunities
    • The main area of focus in recent years has been to provide innovative internet solutions drawing on the wealth of knowledge within the firm
    • Exchange workshops are led by Andersen Consulting specialists and industry experts, who draw on a worldwide base of knowledge capital, interactive exhibits, proven approaches, and best practices to guide visitors toward aligning their people, processes, and technology with strategy
    The Ideas Exchange gives our health care clients an interactive forum for plotting change, changing corporate paths, and inventing solutions. Ideas Exchange
  • The Institute for Strategic Change is a think tank that help clients focus on practical eCommerce issues.
    • The Andersen Consulting Institute for Strategic Change, under the direction of management thought leader Thomas Davenport, is an applied research group focused on issues of concern to senior management. It is both a “think tank” and a center of action; executives visit its Boston-area facility in order to be actively engaged in what the Institute’s latest findings may mean for their business. Current research falls into several major areas: electronic commerce, thinking and acting globally, transforming data into knowledge, and managing attention. The Institute draws on a broad network of business executives, educators, and observers, and publishes its findings for both internal and external audiences.
    • Original Research in Electronic Commerce: Specifically in the area of Electronic Commerce, the Institute is studying new business models and the shifting of marketplace power. Two current projects are described below.
      • The Emergence of “All in One” Markets: Electronic commerce is enabling a new form of electronic marketplace—the “all in one” market. All-in-one markets combine multiple ways of transacting business—such as auctioning, negotiated contracting, and catalog sales—in one place, so that buyers and sellers can easily and dynamically choose the most advantageous approach for a given transaction. Institute researchers predict a rapid proliferation of all-in-one markets—as opposed to the overwhelming “brokerage” or “integration” effects other eCommerce researchers have predicted.
      • Electronic Channels: Living in the Middle Kingdom: In the early days of electronic commerce, new opportunities to establish direct and cost-effective channels through the Internet led many to predict that soon goods and services would travel directly from suppliers to customers without intermediary involvement. Indeed, the way buyers and sellers interact has been transformed. However, electronic commerce has not abolished middlemen. Rather, it has redistributed intermediary activities. Rather than forming linear chains, supplier/customer relations are becoming networked systems. Rather than integrating vertically within an industry segment, participants are learning to integrate horizontally across industries.
    The Institute for Strategic Change
  • Our Internet Centers of Excellence (ICE) will assist in envisioning opportunities and supporting architectures.
    • ICE focuses on delivering solutions that range from helping clients envision their Internet presence through strategy workshops and rapid prototyping to complete implementation, testing and deployment of Internet infrastructures and applications
    • The centers located in Palo Alto, Seattle, Chicago and Boston are highly skilled in leading Web development languages and development tools such as HTML, Active Server Pages, Java, Javascript, VBScript, CGI, Perl, C/C++, DBI/DBD, LiveWire, VRML and Cookies. The centers also have Multimedia Designers skilled in leading edge graphics, animation, video and audio creation tools as well as usability and user testing
    • ICE specializes in designing and developing both Internet and Intranet architectures and creating dynamic and custom content
    • ICE knowledge capital includes reusable assets, tools and established processes that can be applied to common situations across different applications.
    • ICE partners with leading providers to reduce the complexity of implementing and deploying full-scale electronic commerce projects
    • ICE’s proven delivery capability is represented by the key roles played in the successful deployment of Internet projects for a long list of clients that includes Toshiba, Compaq, Crum & Forster, PJM Interconnection Retail Choice, New York Times, Autodesk, Robert Half International, Bay Networks, Sun Microsystems and Microsoft
    — Internet Centers of Excellence (ICE) Capabilities —
    • The emergence of eCommerce demands the virtualization of products and services to meet the needs of consumers, businesses, and knowledge workers. This challenge drives CSTaR projects in data mining, public access systems, virtual enterprise, human-centered design, and agents
    • CSTaR applies advanced engineering principles to software design and development, focusing on the tools and techniques for building business solutions. Technology projects include software reuse, agent-based computing, component- and knowledge-based software engineering, and computer-assisted collaboration in a distributed environment
    • CSTaR is currently developing eCommerce applications:
      • BargainFinder
      • LifestyleFinder
      • ContactFinder
      • PRAIRIE
      • Magic Medicine Cabinet
    The Center for Strategic Technology Research creates business opportunities from technology innovation.
    • Interactive World
    • Internet Music World
    • Backseat Browser
    • Avalanche
    — Center for Strategic Technology Research (CSTaR®) Capabilities —
  • The DAVINCI program showcases leadership in using technology to enable innovative business strategies for clients.
    • One of Andersen Consulting’s most ambitious technology adaptation efforts to date is the DAVINCI Virtual Corporation which attempts to depict a virtual corporation: a group of companies allied to pursue a strategic opportunity, using innovative business strategies enabled by state-of-the-art technology. DAVINCI gives executives a chance to see the technological state-of-the-possible by experiencing a virtual enterprise
    • Businesses that strive to understand the fundamental technology changes taking place and partner with the right organizations to complement their key skills, can transform themselves for survival and growth
    • More than 3,000 executives from global Fortune 2000 companies attended workshops in the U.S. and Europe