Environmental Analysis for Aetna - Paper Example

Currently, many healthcare organizations in the world have been established with the aim of providing insurance services to people. Aetna Inc. is one such healthcare company. The organizations insurance policy covers clients for their health, injury, life, and death risks. The company is a brand by itself given it also provides traditional health insurance products and services for the healthcare improvement of the public. For the last seven years, the company has enjoyed the title of a fortune 500 company with revenues of up to ninety billion and an average workforce of forty thousand. To understand the companys standards however, one needs to read the companys strengths and weaknesses. This should enable interested parties in coming up with a decision on whether to seek services from the company. This paper seeks to conduct an environmental analysis of the company using the SWOT analysis.

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Aetna moved from a fortune 100 company to a leading health insurance company through carefully executed amalgamation and segmentation strategies. Combined with a strong mission and vision, these strategies enabled the company to register increased and strong members. In its mission, the insurance company states that it is committed to helping its clients achieve health security by providing cost-effective and quality healthcare. The companys vision is to earn financial and reputable distinction for being a preferred benefits company in all business matters (Su & Chen, 2014, p. 37). To achieve the stated mission the company has embarked on a reformed strategy that involves creating innovative and quality services that meet the needs of its large clientele (Northwest, 2016, p. 7). The strategy also includes the development of an assorted supplier base to reflect the multicultural environment that forms the clientele. These goals have enabled Aetna to exhibit a variety of strengths both in its internal and external environment.

Strengths

The companys workforce is made of a strong management team, which is motivated and engaged by a workforce that understands the diverse communities in which the company conducts business. This feature enables the company to develop a strong culture that values employee engagement.

The company has a comprehensive product and service portfolio that covers its extensive network of a growing customer base. Hence, the company prides itself for being a one-stop provider of individual and group healthcare insurance plans. For example, the companys widespread national network has led to high-quality customer service for clients in every part of the country (Gelles, 2015, p. 2). This extensive service eliminates the cost of travelling for many people even in the rural areas.

The company products and services represent a quality brand given the company uses a consumer-focused approach.

The company has a strong economy of scale hence it is able to maintain its pricing power.

Aside from its core activities, the company has continued to invest greatly in health information technology. This is a significant investment strategy since information technology is capable of reducing cost and therefore enhancing the quality of healthcare provided.

However, the company still has some weaknesses to eliminate.

Weaknesses

The company has failed to maximize existing opportunities effectively. Hence, it needs to reform its operations in this department to keep competing with other companies (Nambiar, et.al. 2013, October, p. 20).

The company depends highly on the United States market. Hence, it tends to be vulnerable to market conditions within the country.

Opportunities

The company is focused on spreading its services and business operations beyond America so that its business can expand.

The company has been in the health market for a long time. Hence, it has embarked on introducing new products and services to meet the demands of new markets and to supply the old market in which they are operating.

Given the increased level of competition in new markets, the company seeks to expand its business by merging with similar companies and acquiring smaller companies. This should help the company to grow its business and hence counter the competition (Kliff, 2013, p. 31).

The introduction of new products and services has served as a way for the company to improve the transparency of its products and services as well as review its pricing.

The following threats are part of other issues the company needs to consider

Threats

More players are introducing their products in the market. Hence, Aetna needs to strategize to face the competition

The companys continued innovation of products and services risks creating problems for its clients

The government is constantly formulating new market regulations, which could limit the companys efficiency. For example, nationwide healthcare policies could affect the companys business. This could in turn reduce its earnings.

The risk of an economic crisis in a country could affect the companys budget. For example, the 2008 economic crises in the United States resulted in many Americans losing employment. Hence, individuals who were health insured could not afford the health services anymore.

Aetna is a promising company in the health market. However, it has inadequate global presence, which hinders it from making as much profit as it should be making. Nevertheless, the company is strong in various aspects such as management and service provision, which has enabled it to grow over the years. However, if the company can pay attention to its weaknesses and maximize it opportunities without contravening government regulations, it should continue to grow.

References

Gelles, D. (2015). At Aetna, a CEOs management by Mantra. New York Times.

Kliff, S. (2013). Aetna and Inova unveil joint venture for improved, cost-effective health care. The Washington Post. Cited, 31.

Nambiar, R., Bhardwaj, R., Sethi, A., & Vargheese, R. (2013, October). A look at challenges and opportunities of big data analytics in healthcare. In Big Data, 2013 IEEE International Conference on (pp. 17-22). IEEE.

Northwest, M. H. (2016). Aetna Inc.

Su, Y., & Chen, L. (2014). Management Philosophy at ING-Aetna Life Insurance Co. In Modern Oriental Corporate Culture (pp. 33-44). Springer Berlin Heidelberg.