photos by Scott Dobry
Mutual of Omaha needed a new long-term care product—but the team only had a short time to turn an abstract idea into a bottom-line success.
The MutualCare team From left: Kurt Vangreen, Mary McLaughlin, Ronda Allen, Monte Jung, Sherri Green, PMP, Clark HeitKamp, Dave Gregg, Kevin Nelson, Kelly Blaney and Mary Lee Vacca
by Samuel Greengard
Omaha, Nebraska, USA, is no stranger to project management. The nearly century-old company has used project management to oversee everything from IT initiatives to start-up business ventures. But rolling out a new insurance product, getting it approved in various U.S. states and making sure it's on the radar of consumers is an entirely different beast—especially when the company's executives consider it a high-priority project.
About two years ago, the Mutual of Omaha management team identified an opportunity for a new long-term care product. As with any project of this kind, there were internal workflow issues to manage, job responsibilities to assign, marketing and sales matters to oversee, and business partners to collaborate with.
The new product was dubbed MutualCare. But before it could launch, the team had to conduct an opportunity assessment and develop a business case—all while working with a third-party administrator. And to develop an offering that would truly meet market needs, the team also needed to collect input from a cross-section of departments and functions within Mutual of Omaha, including product development specialists.
“The introduction of MutualCare required a great deal of planning and coordination. Getting things right from the start was a huge priority,” explains Kathi Mellor, vice president of product and process management at Mutual of Omaha.
And the initiative is already paying off, helping the company fill a growing—and lucrative—niche in the marketplace.
“Along the way, we faced a number of challenges,” says Sherri Green, PMP, the project manager who oversaw the development of MutualCare. “But we didn't lose sight of our goal to create an important new product.”
Dissecting the Data
The idea for MutualCare took shape in early 2006. Although Mutual of Omaha already had other long-term care products on the market, executives wanted to introduce a less complicated offering. “We recognized that long-term care is getting a lot of press and as the current population ages and becomes more aware of this insurance, there's a greater need for a diversity of products and choices,” Ms. Green says.
The introduction of MutualCare required a great deal of planning and coordination. Getting things right from the start was a huge priority.
—Kathi Mellor, Mutual of Omaha, Omaha, Nebraska, USA
Along the way, we faced a number of challenges, but we didn't lose sight of our goal to create an important new product.
—Sherri Green, PMP, Mutual of Omaha
A long-term care policy helps pay for extended services at a home, nursing home, assisted-living facility or adult day-care center. The policies are aimed at individuals who are unable to perform basic activities of daily life, such as eating, dressing and bathing due to an accident, disability, prolonged illness or the simple process of aging.
The first step in creating MutualCare was to understand the resources required to transform the concept into an actual product. Senior management had handed over a list of project goals to Jill Andreasen, PMP, project director. She shared them with Ms. Green, who was tasked with examining different options and features, as well as the costs associated with them. “We looked for ways to achieve our objectives without making elaborate changes to existing systems and work processes,” Ms. Green says.
Using predesigned templates from the company's project management office, Ms. Green and a team of six began to develop a model using internal data, industry benchmarks and information from its third-party administrator, Long Term Care Group (LTCG), Eden Prairie, Minnesota, USA. The team also worked with a product development manager to ensure everyone had the right focus and information. During that time, the team examined the business value associated with different approaches, looked at overall sales and profit projections, and identified statutory requirements for the 50 U.S. states and territories.
Once the project team had completed the analysis process and generated an assessment of the opportunity, it presented a report to senior management. The product line director responsible for long-term care products also provided input.
Executives determined the project was ready to pass through the first stage gate, and the task of building a business case could begin in earnest. This next step would determine whether MutualCare would become a product and what form it would take in the marketplace.
On the Case
Mutual of Omaha has built a strong foundation based on project management. There are 146 project managers on staff and an established infrastructure designed to route information and resources across the enterprise.
When it comes time to make the case, project managers tap into expertise as needed. “We have a few dedicated business analysts in place but it is up to the project manager to find the subject matter expertise that's needed to generate reports and build business cases,” Ms. Andreasen says.
Typically, project managers recruit the employees who best fit their needs. Most work on a project part-time and handle their regular duties as well; some participate in multiple projects simultaneously. “We have a process that prioritizes initiatives from an enterprise perspective. It helps everyone understand how the organization should allocate resources,” Ms. Andreasen explains. In most cases, managers are able to work things out on their own. However, if a conflict arises, a cross-functional management group helps sort out assignments.
Throughout the process, project managers such as Ms. Green keep detailed notes on what works and what doesn't. They feed the data and documents into an electronic repository that serves as a knowledge management system. “We use the lessons learned to guide future decisions,” she says.
|Company||Mutual of Omaha Insurance Co., Omaha, Nebraska, USA|
|Business||Sells life insurance, long-term care, annuities, other health products, and related financial products and services throughout the United States|
|Sales||$2.14 billion (2006)|
|Project management approach||Has entry-, mid- and senior-level project managers in five areas: group benefit, individual finance, IT, human resources and customer service. Depends on project directors to oversee various initiatives. Relies on formal mentoring, coaching, training and interpersonal skills development to grow talent.|
Philosophy: “Success is all about having a comprehensive project management infrastructure in place and making sure talented people have the tools and resources to do their job well.” —Kathi Mellor
This sharing of data, information and knowledge helps ratchet up Mutual of Omaha's collective intelligence—and capabilities. Project managers can step into a new initiative armed with information.
When Ms. Green began working on the MutualCare business case in early 2006, she pulled relevant templates and documents from the repository. A team then began detailing how product development would take place, how the distribution process would unfold, what form marketing and advertising would take, and how Mutual of Omaha would approach statutory issues and approvals in different U.S. states. They collected and parsed reams of data, detailing almost every aspect of the project. This was also the point where the team started drafting policy language and determining pricing.
In May, the company's senior management approved the business case report and authorized a budget of more than $2 million for the development of MutualCare. The next step would be to create the actual product and release it by late 2006—but not before the team conquered a few more challenges.
It's one thing to develop a plan. It's another to actually execute it. The project management team at Mutual of Omaha knew it had to get the initiative right from the start. Miscues, missteps and miscalculations could lead to cost overruns and time delays. “Senior management had mandated that this was an important project, and we took their word very seriously,” Ms. Mellor explains.
Ms. Green and her project team used 11 work plans to track time, effort and overall progress. Altogether, she had more than 100 employees assembling all the pieces of the MutualCare product. She reported to a project board on a weekly basis. These sessions helped identify emerging challenges and problems, including change-control requests.
Senior management had mandated that this was an important project, and we took their word very seriously.
“Every so often a state writes back and tells you it's not going to approve the product as is, and they tell you what changes they require,” Ms. Green explains.
That meant project managers had to shuffle resources and tweak key processes along the way. The issue was magnified by the need to share specialists with other concurrent projects, and the fact that the company couldn't develop marketing materials until it received state approval.
Another complicating factor was that Mutual of Omaha was coordinating development efforts with LTCG. Ms. Green and her team worked closely with liaisons at LTCG to manage tasks and processes, and to ensure all the required forms and paperwork were in place.
“It was a very complex process that required constant coordination and prioritization,” Ms. Green says.
To collaborate effectively, the two companies had to find a way to exchange project management data residing in different systems and create a standard language and nomenclature to manage communication. They ultimately turned to Excel spreadsheets as the quickest and simplest way to get information back and forth.
On the Street
In late 2006, Mutual of Omaha began rolling out MutualCare to key strategic states.
“Fortunately, we had some very talented project managers involved,” Ms. Mellor says. “They had to understand the processes, the systems and the people. They had to possess leadership skills and negotiation skills. There were significant challenges related to working with a third-party administrator or any outside vendor. We have to work through a lot of different people—internal and external—to get the product on the street.”
Since then, the product has been launched in nearly all 50 states and now ranks as a highly profitable addition to the company's product portfolio.
“MutualCare is one of the most complex products we have ever introduced and we were able to implement it on time and on budget,” Ms. Green says. “It was a real accomplishment.” PM
Samuel Greengard is a West Linn, Oregon, USA-based journalist who covers business and technology.
PM NETWORK | DECEMBER 2007 | WWW.PMI.ORG
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