Integration Management - Cigna's Self-Inflicted Wounds
Wall Street analysts who cover Cigna are troubled by its missteps, but most remain bullish on its prospects for recovery. "This kind of thing is cyclical," says Todd Richter, managing director with Banc of America Securities in New York City. "Over the past five or six years, Cigna stock has outperformed Aetna’s. Aetna is now on a comeback, and they are forecasting huge earnings growth, and Cigna is forecasting down earnings for next year."
Standard & Poor’s Stoddard agrees: "Cigna mismanaged their pricing, mismanaged the risks they were holding in their reinsurance operation, and mismanaged their IT transformation. But these problems can be fixed. Aetna lost millions of members with bad pricing, and they turned it around."
Cigna is working hard to do the same, and Anania remains part of that turnaround team. But even now, the CIO seems reluctant to claim ownership of Cigna’s IT future. When asked if the buck stops here for IT’s performance, she sits back in silence and looks vaguely troubled. It’s left to her PR handler to jump in and say, "Yes, the buck will stop here going forward."
