Cigna Business Environmental Analysis Analysis

Running Head: BUSINESS ENVIRONMENTAL ANALYSIS21BUSINESS ENVIRONMENTAL ANALYSISBusiness Environmental AnalysisI. Market DomainA: Historical SignificanceThe choice of industry on this front will be the healthcare industry specifically the medical healthcare insurance plans. In seeking to evaluate an unmet need in the health insurance realm, it would be prudent to first offer a concise definition of health insurance. In basic terms, health insurance could be defined as a contract that requires a health insurer to pay some or all of [an insured persons] health care costs in exchange for a premium (HealthCare.gov, 2020). Towards this end, some of the things covered by health insurance include, but they are not limited to, some hospital as well as doctor visits, medical devices, prescription drugs, etc. It therefore follows that to a large extent, health insurance may not necessarily provide cover for medical technologies considered brand-new, drug use that is essentially off-label, complementary alternative medicine, cosmetic and elective surgery, etc. However, in my opinion, this is where most opportunities lie for players in the industry. This is more so the case given that failure to avail coverage in this case means that some key market needs remain unmet.Complementary and alternative medicine happens to be rather popular in the U.S. For instance, in a study seeking to assess the prevalence of herbal medicine utilization among adults in the country, more than a third of participants pointed out that they had regularly used herbal supplements (Rashrash, Schommer, and Brown 2017). In the words of the authors, older age and higher education were associated with a higher use of herbal supplements (Rashrash, Schommer, and Brown 2017, p. 109). Herbal medicines happen to be part and parcel of complementary alternative medicine (CAM). The findings of the authors in this case are collaborated by Ventola (2010) who points out that approximately 40% of U.S. adults have at some point utilized CAM. It is therefore clear that a significant proportion of the population already embraces CAM. CAM, according to Ventola (2010), could be perceived as a group of diverse medical and health care systems, practices, and products that are not presently considered to be part of conventional medicine. One of the areas that has seen widespread utilization of CAM is cancer treatment. According to Halter (2018), in as far as the treatment of cancer is concerned, some of the treatment approaches that have been indicated to have a high efficacy rate are radiation and chemotherapy. However, this has not kept most Americans from pursuing CAM in attempts to beat cancer. In the words of the author, nearly 40 percent of Americans believe alternative medicine alone can stop the disease in its tracks (Halter, 2018).To a large extent, most CAM are not covered by health insurers. This leaves a significant portion of CAM embraced by Americans without much health insurance coverage. According to Patricia and Coulter (2016), most CAM practitioners have legal backing as professionals. Indeed, as the authors point out, there are those that are permitted to avail primary care. However, Patricia and Coulter (2016) point out that the said practitioners are yet to be fully embraced by Medicare and private insurers. This is more so the case given that they are largely considered outsiders to the mainstream healthcare system. In the words of Patricia and Coulter (2016), CAM practitioners cannot seek reimbursement from insurers for many services they are trained to perform and so cannot practice to the full extent of their capabilities, which for chiropractors might include giving full physical examinations or writing prescriptions. It should be noted that today, some health insurance plans do not have a problem…

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…RunningHead:BUSINESSENVIRONMENTALANALYSIS21BUSINESSENVIRONMENTALANALYSISBusinessEnvironmentalAnalysisI.MarketDomainA:HistoricalSignificanceThechoiceofindustryonthisfrontwillbethehealthcareindustryspecificallythemedicalhealthcareinsuranceplans.Inseekingtoevaluateanunmetneedinthehealthinsurancerealm,itwouldbeprudenttofirstofferaconcisedefinitionofhealthinsurance.Inbasicterms,healthinsurancecouldbedefinedasacontractthatrequiresahealthinsurertopaysomeorallof[aninsuredpersons]healthcarecostsinexchangeforapremium(HealthCare.gov,2020).Towardsthisend,someofthethingscoveredbyhealthinsuranceinclude,buttheyarenotlimitedto,somehospitalaswellasdoctorvisits,medicaldevices,prescriptiondrugs,etc.Itthereforefollowsthattoalargeextent,healthinsurancemaynotnecessarilyprovidecoverformedicaltechnologiesconsideredbrand-new,drugusethatisessentiallyoff-label,complementaryalternativemedicine,cosmeticandelectivesurgery,etc.However,inmyopinion,thisiswheremostopportunitieslieforplayersintheindustry.Thisismoresothecasegiventhatfailuretoavailcoverageinthiscasemeansthatsomekeymarketneedsremainunmet.ComplementaryandalternativemedicinehappenstoberatherpopularintheU.S.Forinstance,inastudyseekingtoassesstheprevalenceofherbalmedicineutilizationamongadultsinthecountry,morethanathirdofparticipantspointedoutthattheyhadregularlyusedherbalsupplements(Rashrash,Schommer,andBrown2017).Inthewordsoftheauthors,olderageandhighereducationwereassociatedwithahigheruseofherbalsupplements(Rashrash,Schommer,andBrown2017,p.109).Herbalmedicineshappentobepartandparcelofcomplementaryalternativemedicine(CAM).ThefindingsoftheauthorsinthiscasearecollaboratedbyVentola(2010)whopointsoutthatapproximately40%ofU.S.adultshaveatsomepointutilizedCAM.ItisthereforeclearthatasignificantproportionofthepopulationalreadyembracesCAM.CAM,accordingtoVentola(2010),couldbeperceivedasagroupofdiversemedicalandhealthcaresystems,practices,andproductsthatarenotpresentlyconsideredtobepartofconventionalmedicine.OneoftheareasthathasseenwidespreadutilizationofCAMiscancertreatment.AccordingtoHalter(2018),inasfarasthetreatmentofcancerisconcerned,someofthetreatmentapproachesthathavebeenindicatedtohaveahighefficacyrateareradiationandchemotherapy.However,thishasnotkeptmostAmericansfrompursuingCAMinattemptstobeatcancer.Inthewordsoftheauthor,nearly40percentofAmericansbelievealternativemedicinealonecanstopthediseaseinitstracks(Halter,2018).Toalargeextent,mostCAMarenotcoveredbyhealthinsurers.ThisleavesasignificantportionofCAMembracedbyAmericanswithoutmuchhealthinsurancecoverage.AccordingtoPatriciaandCoulter(2016),mostCAMpractitionershavelegalbackingasprofessionals.Indeed,astheauthorspointout,therearethosethatarepermittedtoavailprimarycare.However,PatriciaandCoulter(2016)pointoutthatthesaidpractitionersareyettobefullyembracedbyMedicareandprivateinsurers.Thisismoresothecasegiventhattheyarelargelyconsideredoutsiderstothemainstreamhealthcaresystem.InthewordsofPatriciaandCoulter(2016),CAMpractitionerscannotseekreimbursementfrominsurersformanyservicestheyaretrainedtoperformandsocannotpracticetothefullextentoftheircapabilities,whichforchiropractorsmightincludegivingfullphysicalexaminationsorwritingprescriptions.Itshouldbenotedthattoday,somehealthinsuranceplansdonothaveaproblemcoveringsomeCAMservicesandproceduressuchaschiropracticandacupuncturecare.Thetwohavebeenroutinelyutilizedinthetreatmentofbackpainandmigraines,amongstotherconditions.Itshouldhoweverbenotedthatevenwiththesebeingpaidforbysomeplans,therearesomesignificantrestrictionsthatapply,i.e.withregardtothefrequencyofvisits.Aspertheabovediscussion,thereisaclearneedthatisyettobefullyaddressedbytheinsuranceindustry.Thereisneedforhealthinsuranceplanstocoverawiderrangeofalternativecareservices.Suggestionsonthisfrontinclude,buttheyarenotlimitedto,dietarysupplements,naturopathy,homeopathy,etc.ThisismoresothecasegiventhatvariousstudieshaveindicatedthatasignificantportionoftheadultpopulationintheUSactivelymakesuseofCAM.Inthiscase,insurancecompaniescouldcomeupwithclearguidelinestostreamlinemedicalcoverageonthisfront.Forinstance,coveragecouldbeextendedtomethodsand/orapproachesthathavesufficientbackinginasfarastheireffectivenessinthealleviationofsymptomsand/orillnessesisconcerned.Inthefinalanalysis,thereissoundbasisforalternativemedicinetobeconsideredalongsidetraditioalhealthcarewhenitcomestohealthcareinsurance.B:FactorsComplementaryoralternativemedicine(CAM)continuestobeembracedbymostpersonsacrosstheU.S.andindeedinmostpartsoftheworld.Indeed,accordingtoVentola(2010),asignificantpercentageofAmericanadultshaveinthepastadmittedtousingCAM.Itshould,however,benotedthatinsurancecoverageforalternativemedicinehappenstoberatherlimitedwithsomeinsurancecompaniesexpresslyrefusingcoverageandotherscoveringonlyaselectCAMprocedures/servicessuchasacupunctureandchiropracticcare.Itwould,thus,beprudenttoassesssomeofthefactorsthathavemadehealthinsurancecompaniesbewearyofthisparticularmarketdomain.Tobeginwith,itisimportanttonotethatintheyear2000,theWhiteHouseCommissiononComplementaryandAlternativeMedicinePolicy(WHCCAMP)wasestablishedwithanintentiontoassesssomeoftheconcernsbeleagueringnotonlythedelivery,butalsotheaccesstoCAMacrossthenation,amongstotherthings(NationalInstitutesofHealth,2020).VariousconsultativemeetingswereheldbyWHCCAMPwithvariousstakeholdersgivingtheirperspectivesonthestepsthatneededtobeundertakentoensurethatconsumersderivedmaximumbenefitsfromCAMtherapies.Inoneofitsfindings,thecommissionpointedoutthatoneofthekeyreasonsastowhymostinsurancecompaniesgaveCAMtherapiesawideberthwaslackofasufficientbasisastotheeffectivenessofthesaidtherapies(NationalInstitutesofHealth,2020).ThisistosaythatmostcompanieswereconcernedoverthelackofauthoritativeevidenceinsupportofthemedicaleffectivenessofCAM.Towardsthisend,playersinthehealthinsuranceindustry,asthereportpointsout,wereconcernedthattheirlimiteddollarsbespentoncarethathasbeenshowntobesafeandeffective(NationalInstitutesofHealth,2020).ItisalsoimportanttonotethatdespiteresearchontheeffectivenessofCAMhavinggatheredsteaminrecenttimes,oneotherproblemthatplayersinthisrealmhavehadtoconfrontissafetyofCAM.Insurancecompanieshaveshiedofffrombeingengagedinanundertakingdeemedtobeinherentlyhighriskinasfarasthehealthandwellbeingofpatientsisconcerned.Atpresent,unlikeisthecasewithconventionalmedicine,wedonothaveawell-foundedframeworkfortheassessmentandevaluationofthesafetyofCAMdrugsandtreatmentapproaches.Thisbringstotheforeotherconsiderations,i.e.theethicalaspectofproppingupapproachesthatcouldhaveanetnegativeoutcomeonthewellbeingofpatients.YetanotherfactorthathasmadehealthinsurancecompaniesignorethisparticularmarketdomainisthelackofcriteriatoassessthemedicalviabilityornecessityofCAMtherapies(SynovitzandLarson,2013).Thisismoresothecasegiventhatinconventionalmedicine,therearewell-developedmethodologiesofmakingadeterminationastotherelevanceofprocessesandproceduresafactorthatisofgreatrelevancetohealthinsuranceriskmanagement.Inconventionalmedicine,thereisanestablishedframeworkofnecessityassessmentcomprisingofprofessionalorganizations,medicalinstitutions,medicalschools,etc.However,asithasbeenpointedoutelsewhereinthistext,therearestillsomehealthinsurancecompaniesthatcoveralternativeandcomplimentarytherapies.Onesignificantenablingfactorispatientdemand.Indeed,inthewordsofHermanandCourter(2015),theAmericanHospitalAssociationsurveyofhospitalsfoundthat49percentofrespondentsindicatedthatpatientdemandwastheprimarymotivationforofferingCAMservices(74).Thiscouldhavesentsomecompaniesbacktothedrawingboard,withtheirstrategicteamsassessingthemostappropriatewaystoincorporateCAMtherapiesintoplans.Next,itshouldalsobenotedthatmosthealthcareinstitutionshaveembracedintegratedcare.Thisismoresothecasegiventhatalthoughthecountry,andprettymuchtherestoftheworld,haslargelybeendominatedbythebiomedicalconceptualframework,thereareindicationsthatallthiscouldbeslowlychanging.Asamatteroffact,HermanandCourter(2015)arecategoricalthatatpresent,thereisevidencethatothertherapeuticmodalities,withdifferentconceptualframeworks,arebeginningtocompetewiththisdominantmodel(102).Insurancecompaniesarecognizantofthefactthatgoingforward,CAMwillclaimabiggershareofwesternmedicine.C:ImpactofFactorsThefactorshighlightedabovehavehadamajorinfluenceonopportunitiesforbothinnovationandchangeintheCAMinsurancerealm.Tobeginwith,theyhavesloweddowntheintegrationofconventionalmedicinewithCAM.Thisismoresothecasegiventhatplayersinthehealthcareindustrydonothavesufficientmotivationandincentivestopursuethiscourseofaction.IfhealthinsuranceplansweretoactivelycoverCAM,thesaidplayerswouldbekeenonfindingwaysofintegratingconventionaltherapieswithCAMtherapies.Thehighlightedfactorscould,however,haveinadvertentlyspurredresearchontheeffectivenessofCAMtherapies.ThisismoresothecasegiventhatasHu,Li,Duan,andArao(2013)pointout,forpolicymakers,practitioners,patients,andhealthcaresystemmanagerstomakeinformeddecisionsabouttheuseofCAMtherapies,theymusthavebothaccesstoandameansofevaluatingtheresultsofresearchonthetopic.ItisoutofthisneedthatsystematicreviewsonthemedicalsignificanceCAMtherapiesareincreasinglybeingpursued.Forinstance,accordingtoHu,Li,Duan,andArao(2013),thereisincreasedactivityinresearcheffortsseekingtodeterminehoweffectiveCAMareamongsthypertensionpatients.Further,andperhapsratherobviously,itwouldalsobeprudenttonotethatthefactorshighlightedinthisdiscussionhavehadanimpactontheprevalenceofCAM.AlthoughCAMhappenstoberatherpopularashasbeenindicatedelsewhereinthistext,lackofconsensusonwhetherinsurancecompaniesshouldformulatehealthinsuranceplansinthisregardhaskeptasignificantproportionofthepopulationfromCAM.Forinstance,forthemostpart,CAMdoesnotfeatureingrouphealthinsurancepoliciesorhealthinsurancepoliciesprovidedbyemployers.Itthereforefollowsthatforthemillionsofemployeesinthecountrywithaccesstogrouphealthinsurancepolicies,CAMtherapiesaresimplynotanoption.II.CompetitiveReadinessA:SWOTAnalysisCignaCorporationisaglobalhealthservicescompanythatoffersinsuredandself-fundedprescriptiondrugbenefit,vision,behavioralhealth,dental,andmedicalbenefitplanstoindividualsinhealthcarebenefitprograms.Thecompanyalsoprovideslifeanddisabilityinsuranceplansinconnectionwithcertainexperience-ratedmedicalproducts.HeadquarteredinBloomfieldConnecticut,Cignaisoneoftheleadingcompaniesinthehealthcareinsuranceindustry.ThissectionpresentsaSWOTanalysisofCignaCorporationtoidentifythepotentialsourcesofcompetitiveadvantageforthecompanysfuturesustainability.1.SWOTAnalysisStrengthsa)ThesizeofitsnetworkTheCompanyhasoneofthestrongestnetworksthatincludesover700accountablecareprograms,over500hospitals,andover175,000mentalandbehavioralhealthcareprograms(Cigna,2020).Thecompanyserves17millionmedicalcustomersglobally,17milliondentalcustomers,22millionUScustomers,over67,000contractedpharmacies,MedicalAdvantagePlansin16statesandWashingtonDC,andMedicarePrescriptiondrugplansinall50states(Cigna,2002).b)ComprehensiveofferingsCignaoffersafullrangeofindividualandgrouphealthcareplans,whichmakesitaone-stopshopforinsuranceandhealthcareplansandgivesitanedgeovercompetitors(Vourmanetal.,2013).c)InternationalCoverageCignahas,inrecentyears,reportedasteadygrowthinitsinternationalcoverageandcurrentlyserves17millionglobalcustomers,withaglobalnetworkofover1.5millionhealthcareproviders(Vourmanetal.,2013).Thecompanyrealizesinternationalexpansionthroughjointventureswithestablishedsubsidiariesinpromisingmarkets(Vourmanetal.,2013).d)StrategicAcquisitionCignahasdrivengrowthbymakingimpressiveacquisitionsthathaveplayedahugeroleinimprovingoverallprofitabilityandmarketaccess.AmongthemostnotableacquisitionsisthatofHealthSpring,aMedicareAdvantageproviderbasedinNashville,whichenhancedCignascompetitivenessintheMedicaremarketbyaddingcoverageto11additionalstates(Vourmanetal.,2013).Weaknesses1.HighIndebtednessCignahasreportedahugeincreaseindebtinrecentyears,atanaveragegrowthrateof29percentascomparedto15percentgrowthforequitycapital(Vourmanetal.,2013).ThehighdebttoequityratioplacesthecompanyatadisadvantagerelativetocompetitorssuchasWellpointandAetna(Vourmanetal.,2013).Italsoaffectsitschancesofobtainingcredittofinancestrategicacquisitionsinfuture(Vourmanetal.,2013).1.LowMedicareExposureTheCompanyhasalowexposuretoMedicare(Vourmanetal.,2013).In2011,thecompanyannounceditsintentiontoexittheMedicareAdvantagemarket.Beforethe2012acquisitionofHealthSpring,thecompanysmembershipintheMedicareAdvantageprogramwasonly46,000(Vourmanetal.,2013).TheacquisitionofHealthSpringin2012wasgearedatenhancingthecompanyscoverageintheMedicaremaket,butitonlyincreasedthemanagedcaremarketcoverageby340,000people(representing3percentofthemanagedcaremarket)(Vourmanetal.,2013).1.EthicalConcernssurroundingprivateinsurancecompaniesCignahasbeenthesubjectoffraudinvestigationsthatposearisktoitsreputation.Inthemostrecentcase,thecompanysmanagementwasunderinvestigationforallegedlymisleadingshareholdersaboutitscompliancewithMedicareregulations.Althoughthecasewasdismissed,itportraysthecompanyinthenegativelightandthreatensitsreputation.1.DifficultyintegratingformswithdifferentorganizationalculturesAlthoughithasmadesomesuccessfulacquisitions,Cignahashaditsfairshareoffailureintegratingcompanieswithdifferentorganizationalcultures.Forinstance,thecompanywasunabletoeffectivelyintegratewiththeMemorialHermannHealthSystem,consequentlylosingoutongrowthopportunitiesthatwouldhaveyieldedsignificantbenefits.Opportunities1.InclusionoftheuninsuredpopulationEstimatesfromtheUSCensusBureauindicatethatthereareapproximately25.6millionuninsuredpeopleintheUSasat2018(Berchick,Barnett&Upton,2018).ThisuninsuredpopulationpresentsagrowthopportunityforCigna,particularlywiththeenactmentoftheAffordableCareAct,whichincreasesMedicaideligibilityandoffersincentivesforbusinessesthatofferhealthcarebenefits.1.TheMedicareManagedCareMarketThe2012acquisitionofHealthSpringwasafundamentalfirststeptowardsexpandingCignasMedicarepresence.TheagingpopulationoffersanadequateopportunityforgrowthinMedicare,particularlybecausethenumberofthoseagedover65isexpectedtoincreasebyapproximately80percentby2030(Vourmanetal.,2013).1.TheGrowthofAdministrativeServicesOnly(ASO)PlansThequestforlow-costinsuranceisdrivingmoreandmoreemployerstowardsASOplans,wheretheemployerisheldexclusivelyliablefortheiremployeesfinancialclaimstoacertainstoplosspoint,withthemanagedcareorganizationplayingmoreofanadministrativerole(Vourmanetal.,2013).ThegrowingpopularityofASOplansoffersapromisinggrowthopportunityforCigna.1.Increasingdemandforemployee-sponsoredinsuranceRisinghealthcarecostsandchangingdemographicsaredrivingemployersandemployeestosearchforproductsthatarebothflexibleandcost-effective.Employee-sponsoredprogramsaregrowinginpopularityandCignaisadequately-positionedtoofferintegratedinnovativesolutionsthatcanservetheneedsoftheseemployeesandemployersbycustomizingitswideproductbase(Vourmanetal.,2013).Threats1.EmergentformsofCompetitorsAlthoughitenjoysastrongpresence,Cignafacesintensecompetitionfromlargeinsurancecompanies,third-partyadministrators,PPOsandHMOs(Vourmanetal.,2013).Anewgroupofcompetitorsfocusedondeliveringservicesthroughinternet-basedtechnologiesisalsoemerging,posingathreattofutureprofitability.1.RisingMedicalCostsThecostofhealthcareisgrowingatasignificantrate,andsoarereimbursementratestophysiciansandhospitals.Hospitalmergersarebecomingmorepopular,whichimplieshigherbuyerbargainingpower,higherreimbursementrates,andreducedfutureprofitability.1.AffordableCareActprovisionsthatthreatensustainabilityOneoftheprovisionsoftheACAchangescommercialhealthplansmedicallossratiosto80percent,withcompaniesrequiredtoreturnportionsofpremiumstocustomersifthesamearenotspentonhealthcare.Suchprovisionsthreatenthecompanysperformanceandprofitability.1.NegativepublicperceptionaboutprivateinsurancecompaniesPrivateinsurancecompanieshavebeeninthenegativelightinrecentyearsfortakingadvantageofalready-strainedinsuredcitizens(Vourmanetal.,2013).ThesenegativeperceptionsplacecompaniessuchasCignaunderthescrutinyofgovernmentagenciesandforcecompaniestoincuradditionalcoststoensurecompliancewithnewconsumer-protectionregulations.Cignascostsareexpectedtogoup,reducingprofitability.2.PrioritizedListPrioritizedInternalStrengthsHowwellacompanythrivesinacompetitiveenvironmentdependsonhowwellitcanmaximizeonitsstrengthswhilemitigatingitsweaknesses.FromtheSWOTanalysis,thecompanycouldprioritizetwofundamentalinternalstrengths:1.Theexpansivenetworkgivesthecompanyacostadvantagethatsmallercompetitorsareunabletomatch.Thecostadvantagemakesitpossibleforthecompanytoofferlowerpremiumpricesthatmaybeunsustainablebysmallercompanies,butveryattractivefortheaginganduninsuredpopulations1.Comprehensiveofferingsmakethecompanyaone-stopshopforinsuranceplansandprograms.Thecompanyscomprehensiveofferingsplaceitinagoodpositiontomeetthediverseneedsofemployersandemployeesbycustomizingexistingplans.PrioritizedInternalWeaknesses1.Highindebtednessasevidencedbythedebt-equityratioimpactsfinancialsecurityandlimitsthecompanysborrowingability.Ifthecompanyisunabletoborrowinfuture,itmaybeunabletotakeadvantageoftheglaringopportunitiesitfacessuchasthelargeuninsuredpopulationandthegrowingpopularityofASOplans.Thereisaneedforthecompanytocorrectitsdebt-equityratiotoimproveitsabilitytoaccessdebttofinancefutureexpansion.1.LowMedicareexposurelimitsthecompanysabilitytotakeadvantageoftheopportunitiesofferedbythegrowingageingpopulation.ThereisaneedtoexpandthecompanysMedicarecoveragethroughmoreacquisitionsofMedicareAdvantageorganizations.MedicareAdvantageprogramsofferanopportunityforthecompanytoincreaseitsrevenuestreams,thuslimitingtheoverrelianceondebtcapital.3.ReadinessDespitetheidentifiedweaknesses,Cignaisreadytocompeteintheindustryenvironment.Thisreadinessisevidencedbyseveralfactors.First,thecompanycouldtakeadvantageofitsvastnetworkandscaleeconomiestoofferpremiumsatlowerpricesthansmallercompetitorscansustain.Withlow-pricedpremiums,thecompanyisbetter-placedtoappealtolow-incomeuninsuredpersonsandthegrowingageingpopulation(aged65andover),whosesizeisexpectedtogrowsignificantlyby2030.Successintheinsurancemarketdependsonhowwellacompanycandifferentiateitselfasonethatunderstandstheneedsofindividualcustomersandcandevelopthemostattractiveplansforthem.Cignaiswell-knownforitswideproductofferingwithregardtohealthcareplansthistranslatestoaheightenedabilitytocustomizeitscurrentplanstomeetthethediverseneedsofcustomers.Withitsexpansivenetworkofhospitalsandotherhealthcareorganizations,thecompanyhasgreatpotentialtooffercoverageforalternativemedicinesuchasdietarysupplements,homeopathy,neuropathy,andtraditionalhealthcareinabidtomaximizehealthoutcomes,particularlyfortheagingpopulation.B:PESTAnalysisTherelevanceofPESTanalysiscannotbeoverstatedwhenitcomestotheevaluationorassessmentofthevariousfactorsthathaveanimpactontheoperationsofanenterprise.PESThappenstobeanacronymofPolitical,Economic,aswellasSocialandTechnologicalfactors.AccordingtoPartridgeandSinclair-Hunt(2005),PESTanalysisenablescompaniestocometotermswiththevariousforcesinthemacro-environmentthatareaffectingthebusinessnowandarelikelytocontinuedoingsointhefuture(77).Inthequadrantbelow,someofthefactorsthataffectCignaCorporationsreadinesstocompetehavebeenhighlighted.1.PESTAnalysisPoliticala)PoliciesandregulationsCigna,likeisthecasewithanyotherbusinessenterprise,isboundbyvariousrulesandregulationsthatgovernitsoperations.Eachgovernmentcomeswithitsownpoliciesandregulationstailoredtohelpitdeliveronitsmandate.Forinstance,inseekingtoimpacthealthcoverage,thefederalgovernmentcouldformulatestandardsthatimpactnotonlyessentialhealthbenefits,butalsocostsharingbenefits.ThefactthatCignaoperatesinvariousjurisdictionsalsomeansithastoensurethatitadherestothelawsenforcedbythehostnationsomeofwhichcouldaffectthenatureandconductofitsbusinessoperations.b)PoliticalstabilityForcompaniesthatoperateinternationally,therelevanceofstabilityinthepoliticalrealmcannotbeoverstated.Thisismoresothecasegiventhatinstabilityonthepoliticalfrontimmenselyaffectsbusinessoperations.Forinstance,aggressivetakeoverofagovernmentorelectoralfraudinacountrythatCignaoperatesincouldtriggerviolenceandgeneralunrestthatendsupaffectingoperationsofthebusiness.Thisisparticularlythecasewhenitcomestothecollectionofpremiumsandtheinabilitybypolicyholderstodisbursepremiums.c)TaxationInessence,taxationaffectsthereturnsthatabusinessrakesinfromitsoperations.Thisessentiallymeansthatanincreaseintaxationinmostcaseshastheverysameeffectasanincreaseinthecostofdoingbusiness.Anunfriendlytaxationregimewould,thus,affectCignasbottom-line.Intheworstcasescenario,thecompanycouldbeforcedtoeitherscaledownitsoperationsorexitthemarketaltogether.d)ForeignpolicyAsithasbeenpointedoutelsewhereinthistext,Cignaoperatesinmultiplelocationsacrosstheworld.Inessence,thetraepolicyoftheUnitedStatescouldimpactthecompanysabilitytooperateacrossinternationalborders.Forinstance,iftheUnitedStatesandacountryinwhichCignaoperatesweretoengageinseveretradewarsorhavetheirdiplomaticrelationssignificantlysoured,thehostcountrycouldretaliatebymakingitdifficultforCigna(andotherU.S.corporations)tooperate.Thisisparticularlythecasegiventhatinmostcases,governmentsoftendraftbilateralagreementswitheachothersoastomakeiteasyforbusinessestodobusiness(i.e.viatheestablishmentofcommonmarketsorfreetradearea).Economic1.UnemploymentrateForentitiesoperatingintheinsuranceindustry,ahighunemploymentratehasadirectimpactontheabilityofpeopletopaytheirinsurancepremiums.Thisismoresothecasegiventhatahighunemploymentessentiallymeansthatmosthouseholdslackthelevelofincomenecessarytomeettheirneeds.ThelatestunemploymentdatafortheUSindicatesthattherewasaslightdeclineintheunemploymentrateinSeptember(7.9%)ascomparedtothepreviousmonthwhoseunemploymentratewascapturedas8.4%(Saphir,2020).WiththeUSbeingCignaslargestmarket,thisisafactorofgreatrelevancetothecompany.1.BusinesscyclestageInthewordsofSamuelson(2010),businesscycleisatermusedinreferencetoeconomy-widefluctuationsinproduction,trade,andgeneraleconomicactivity(79).Astheauthorfurtherpointsout,thereareanumberofdistinctbusinesscycles.Theseareinclusiveof:expansion,peak,contraction,andtrough.Duringanexpansion,Cignawouldmostlikelydowellastheeconomyatthispointwouldbebooming(i.e.withincreasedemploymentandGDP).However,duringacontraction,Cignawouldmostlikelyhaveitsoperationsimpactednegativelyasaconsequenceofthedownturnineconomicactivity(withemploymentratesdecliningandeconomicgrowthslowingdown).1.FinancialmarketsefficiencyInsurancecompaniesofteninvestasignificantportionoftheirholdingsinthefinancialmarkets,specificallycommonstocksandbonds.ThisisparticularlythecasegiventhatakeyactivityofentitiessuchasCignaisthecollectionofpremiumsandholdingofthesameuntilaclaimislodged.Thisresultsinthecreationofahugefloatwhichtheyinvesttocreateadditionalincome.Itisforthisreasonthatinsurancefirmsaresomeofthebiggestoperatorsinthefinancialmarkets.Inefficienciesinthisrealmwouldmostdefinitelyimpacttheirbottom-line.1.KindofeconomicsysteminplaceAccordingtoSamuelson(2010),someoftheeconomicsystemswehaveareinclusiveof;traditionaleconomies,commandeconomies,mixedeconomies,andmarketeconomies.ItisimportanttonotethatCignacouldbeaffectedbythekindofeconomicsysteminplaceinacertainjurisdictionowingtothefactthateacheconomicsystemhasitsownuniquecharacteristics.Forinstance,inacommandeconomicsystem,theoperationsofCignawouldmostlikelybesubjecttostrictergovernmentcontrolthanwouldbethecasein,say,amarketeconomicsystem.Sociala)Demographics(age)Therearemanydemographicalfactorsthatimpacttheinsurancebusinessmodel.ForacompanylikeCigna,itwouldbebetterplacedtotailoritsproductstomeettheneedsofpersonshavingcertaindemographiccharacteristics.ItisimportanttonotethataccordingtoCantiello,Fottler,Oetjen,andZhang(2015),availabledataclearlyindicatesthatagehappenstobeoneofthemajorfactorsinasfarastheuptakeofhealthinsuranceisconcerned.Forinstance,inasfarasageisconcerned,youngpersons(ofage18-24)aretheleastlikelyagegrouptoembracehealthinsurance(Cantiello,Fottler,Oetjen,andZhang,2015).Apartfromage,thereareanumberofotherfactorswhichcouldaffecttheuptakeofinsurancehenceaffectingtheabilityofCignatopenetratethemarket.Inthewordsoftheauthors,socioeconomicstatus,minoritystatus,perceivedhealth,perceivedneed,andperceivedvaluearesignificantpredictorsofprivatehealthinsurancecoverage(Cantiello,Fottler,Oetjen,andZhang,2015,p.77).b)PrevailingattitudesInbasicterms,attitudescouldbedescribedasthetendencyorpredispositionofapersontoreactinacertainwaytoasituation,person,oridea.Inthehealthinsurancebusinessrealm,therefore,attitudesrelatetotheperspectivespeopleharborabouthealthinsurance.Itisthesaidperspectivesthatwouldinfluencetheirchoiceofaction,i.e.inasfarasseekinginsurancecoverorpurchasinghealthinsuranceisconcerned.c)CultureOnthisfront,culturecouldbedefinedasthesocialbehaviorsaswellascustomsandidealsofpersonswithinagivensocialsetting.Variousresearchstudieshaveinthepastdemonstratedthattheculturedoesaffectinsuranceuptake.Religionispartofculture.AccordingtoEck(2011),thereappearstobeastrongcorrelationbetweenreligiousbeliefsandriskpreferences(42).Intheinsurancebusiness,thehighertheriskpreferences,thelowertheinsuranceuptake.d)EducationlevelsEducationlevelshaveanimpactonawiderangeoffactorsincluding,butnotlimitedto,incomelevelsandawarenessofvariousfactorsimpactinghealthandwellbeing.Thus,inadditiontobeingmorelikelytoearnmore,personspossessinghigherlevelsofeducationaremorelikelytobeawareofnotonlytherelevanceofhealthinsurance,butalsothevariouspoliciesavailableandhowtheycouldcomeinhandyinlesseningthefinancialburdenfollowinganillness.OwingtothefactthatCignaoperatesindiversejurisdictions,witheachjurisdictionhavingvaryinglevelsofeducation,thiscouldbedeemedanimportantmacro-environmentalfactorofrelevancetothecompany.Technological1.RecenttechnologicaladvancesAdvancesintechnologyaffecteveryindustry.Theinsuranceindustryisnoexception.Itishoweverimportanttonotethatadvancesintechnologycouldeitherenableorlimittheconductbusinessonthisfront.Thus,inthehealthcareinsurancerealm,advancesintechnologycouldeitherbeaboonorbaneforoperatorsintheindustry.Thisismoresothecasewhenitcomestothecostofdoingbusinessandimprovedefficiencyintheconductofbusiness.1.TechnologicaldiffusionrateInbasicterms,thiscouldbedescribedastheratebywhichtechnologyisembraced.Asithasbeenpointedoutelsewhereinthistext,thereisnodoubtatallthattechnologyhasrevolutionalizedthewayinwhichbusinessisconducted.Tosomeextent,theimpactthattechnologyhasdependsonhowfastitisadopted.Forinstance,asPal(2019)observes,healthinsurancecompaniesarefindingsocialmediaincreasinglyusefulwhenitcomestocustomerengagementandcustomereducation.However,theextenttowhichCignacanmakeuseofthismediadependsontheextentofsocialmediautilization.WhilethepercentageofinternetusersisforinstanceveryhighintheU.S.,somepartsoftheworldstillhaveaverylowpenetrationrate.2.PrioritizedListIneachofthefourquadrantsidentifiedabove,therearekeyissuesthatoughttobeaddressedfurtherwithregardtohowtheyaffectCignasreadinesstocompete.PoliticalInasfaraspoliciesandregulationsareconcerned,itisimportanttonotethatthecompanyissubjecttothevariouspoliciesasmaybeformulatedfromtimetotimebythegovernmentoftheday.Forinstance,onerecentlegislationthatthecompanyhashadtocontendwithistheExecutiveOrder13813ofOctober12,2017(PromotingHealthcareChoiceandCompetitionAcrosstheUnitedStates)whichPresidentDonaldTrumpsignedintolawonthe22ndofDec,2017(WhiteHouse,2017).Playersinthehealthinsuranceindustry,includingCignaCorporation,wereimpactedbythisparticularexecutiveorderinvariousways.Forinstance,theexecutiveordermeantthatcompaniessuchasCignahadtorestructuretheiroperationsintherealmsofAssociationHealthPlans(AHP),ShortTerm,LimitedDurationInsurance(STLDI),etc.Similarpoliciescouldimpactthewaythecompanydoesbusinessinthefuture.Next,whenitcomestotaxation,itshouldbenotedthatjustlikeanyotherenterpriseinoperation,CignaCorporationhasamandatetopaytaxes.Itthereforefollowsthatchangesinthetaxratecouldaffecttheoperationsofthecompany.Forinstance,onthe22ndofDec2017,anewtaxlawcameintoeffect.ChristenedtheTaxReconciliationAct,thisparticulartaxlawhadaneffectontheentirehealthinsuranceindustry.Inreferencetothelaw,Deloitte(2018)pointoutthatsignificantchangestothetaxationofproperty-casualty(P&C)andhealthinsurancecompaniesincludechangestolossreservediscountingandprorationofcertaintypesofinvestmentincome.EconomicTobeginwith,businesscyclestageisagreatdeterminantofhowwellbusinessentitiesdo.Forinstance,adownturnineconomicactivitycouldresultinlossofemploymentaswellaslowerincomesandwages.Thiseffectivelylimitspeoplesuptakeofhealthinsurance.Next,whenitcomestofinancialmarketsefficiency,itshouldbenotedthatinsurancecompanieshappentobesomeofthelargestoperatorsinthesaidmarkets.Thus,inefficienciescouldimpacttheirbottom-line,i.e.inasfarastheirinvestingactivitiesareconcerned.SocialThereareanumberoffactorsthatcouldaffectpeoplesdecisiontoenroll.Whentheprevailingattitudesarepredominantlynegative,uptakeofinsurancecouldbelimited.Asurveyconductedlastyearindicatesthatlagemajoritiesofinsuredadultsaresatisfiedwiththeircurrentcoverage(CollinsandGunja,2019).ThiscouldbeaboonforCignaCorporation.Ontheotherhand,demographicscouldalsoaffectCignasoperationsinthehealthinsurancerealm.Thisismoresothecasewhenitcomestoage.ForinstanceaccordingtoCantiello,Fottler,OetjenandZhang(2015),thechancesofbeinginsuredincreaseasapersongrowsolder(72).TechnologyWhenitcomestorecenttechnologicaladvances,thereareawiderangeofinnovativesolutionsthathavechangedhealthinsuranceforthebetter.Advancesintechnologyhavetheabilitytochangethewaythingsaredoneinanyindustry.Companiesleftbehindbytechnologicaladvancescouldfinditdifficulttoremainrelevantinthemarketplace.ThisisanassertionsupportedbyRichins(2015)whoobservesthattechnologyhasalwaysbeenaleaddisruptorofindustries(33).3.ReadinessAshasbeenhighlightedbelow,Cignaappearscapableandreadytothriveinthebusinessenvironmentonthebasisofthevariousfactorsidentified.PoliticalAtpresent,Cignaappearswellpositionedtosecureandadvanceitsinterestsviapoliticallobbying.Inits2015PoliticalContributionsandLobbyingActivityReport,thecompanypointsoutthatitregularlysupportsfederal,state,andlocalofficials,candidates,partiesandotherpoliticallyorientedgroupsandorganizationswheretheCompanybelievesitcanadvanceitsmission,businessobjectivesandgoals(Cigna,2015).ItshouldalsobenotedthatowingtothefactthatCignaisamultinationalcorporation,itisabletoachievesystematicdiversificationofpoliticalrisk.EconomicThereareanalystswhohaveinrecenttimesobservedthattheU.S.hasalreadyenteredintoarecessionaryperiod(Leonhardt,2020).CignaCorporation,justlikeisthecasewithmanyotherbusinessenterprises,maynothavebeenwellpreparedforadownturnineconomicactivity.Someoftheoptionsthatthecompanycouldexploretoremainafloatisthedownsizingofitsworkforce.Adownturnineconomicactivitycouldalsohaveanegativeimpactontheefficiencyoffinancialmarkets.Cignasinvestingactivitiescouldbehamperedbyinefficienciesinthesaidmarkets.SocialAvailabledataindicatesthatasignificantproportionoftheU.S.populationispredominantlyyoungwiththelargestagegroupinthiscasebeingadultsofbetweenage25and29(Statista,2020).However,asithasbeenpointedoutelsewhereinthistext,thechancesofbeinginsuredincreasewithage.Itisimportanttonotethatintherecentpast,Cignahasbeenexpandingitsofferingssoastoappealtomorepotentialpolicyholders.Forinstance,asthecompanypointsout,in2021,itwillbeofferingindividualandfamilyplansontheindividualexchangesin220countiesspanning10states:Arizona,Colorado,Florida,Illinois,Kansas,Missouri,NorthCarolina,Tennessee,UtahandVirginia(Cigna,2020).TechnologyCignahasbeenattheforefrontoftechnologicalinnovation.Towardsthisenditiswellpreparedtohandletechnologicaldisruptionandembraceemergingtechnologytoadvanceitsagenda.Forinstance,lastmonth,thecompanyincorporatedscreeningstoexpanditsvirtualcaresuite(Cigna,2020).III.OpportunitiesandTrendsA:IntrapreneurialOpportunitiesToalargeextent,Cignahappenstohaveanexpansivenetworkthatsmallercompetitorscannoteasilyreplicate.Thesaidnetworkoffersthecompanyanimpressivecostadvantage.Inadditiontothis,thecompanyhasbuiltacomprehensiveofferingscatalogueandhasmanagedtofashionitselfasaone-stopshopforawiderangeofinsuranceprogramsaswellasplans.Thesehappentobesomeofthekeystrengthsofthecompany.Thecompany,however,facesamajorthreatinasfarasitscontinuedsuccessisconcerned.Inthiscase,itisimportanttonotethatalthoughthepresencethatthecompanyenjoysinthemarketislargelyenviable,itisnotunassailableandasamatteroffact,CignafacesstiffcompetitionfromHMOs,PPOsaswellasthird-partyadministratorsandlargerplayers(Vourmanetal.,2013).Itthereforefollowsthatthecompanyoughttoinnovateifitistoremainrelevantgoingforward.Insodoing,thecompanywouldbewell-placedtotapintothestrengthsthathavebeenhighlightedabovei.e.inasfarasitsexperiencewithacomprehensivecatalogueofinsuranceplans/programsaswellasitsexpansivenetworkareconcerned.B:IntrapreneurialAssessmentAccordingtoPrindle(2018),manypatientswantalternativehealthcare,butgettinginsurancecoveragecanbetough.Asfurthernoted,complementaryandalternativemedicine(CAM)continuestobepopulareachpassingday.Inbasicterms,CAMcouldbedescribedasanykindofhealthcaretreatmentoptionorpracticethatisconsiderednon-conventional,andthatisnotpartoftheWesterntraditionalmedicine(Ruggie,2004).Towardsthisend,thereareawiderangeofCAMservicesthatareofferedacrossthecountry.Someofthemorecommononesinclude,buttheyarenotlimitedto;chiropracticcare,acupuncture,massagetherapy,naturopathy,homeopathy,etc.NotalloftheaboveCAMservicesfalloutsideofinsurancecoverage.AccordingtoPrindle(2018),therearequiteanumberofinsurancecompaniesthatcoverchiropracticcareandacupuncture.CignashouldpioneerthecoverageofadditionalCAMservices.ThismoresothecasegiventhatavailabledataclearlyindicatesthatmoreandmoreAmericasarebecominginterestedincomplimentaryalternativemedicine.Asamatteroffact,accordingtoasurveybyPEWResearch,abouthalfofAmericansreportedofhavingtriedsomeformofalternativemedicine,suchasherbalremedies,acupuncture,chiropractictreatmentorenergytherapies,atsomepointduringtheirlifetime(PEWResearch,2017).ThisisahugemarketthatCignashouldfindwaysofexploiting.1.RelevanceofExpansiveNetworkAlreadythecompanyhasanexpansivenetworkthatisinclusiveofover700accountablecareprograms,over500hospitals,andover175,000mentalandbehavioralhealthcareprograms(Cigna,2020).IfthecompanyweretorolloutcoverageforCAM,itwouldbeabletoreachouttomillionsofcustomersspreadacrossthenation.Thecustomerbaseinthiscasewouldbeinstrumentalinriskpoolingespeciallygiventhatthisisessentiallyanewfrontierthatthecompanyiskeenonconquering.Itisimportanttonotethatriskpoolinghappenstobeoneofthemostimportantinsuranceconcepts.Fromaconventionalperspective,this,asRuggie(2004)pointsout,ismoresothecasegiventhatpoolingriskstogetherallowsthehighercostsofthelesshealthytobeoffsetbytherelativelylowercostsofthehealthy,eitherinaplanoverallorwithinapremiumratingcategory(79).Inthiscase,millionsofcustomerswouldbecontributingtoacommonpoolwhichwouldbeinstrumentalintheevenspreadingofrisks(specificallyfromexpensiveCAMclaims)amongthesaidcontributors.2.RelevanceofComprehensiveOfferingsAdditionally,itshouldalsobenotedthatalready,thecompanyhasahugecatalogueofofferings.Itthereforefollowsthatthatcompanyisskilledintheartofmanagingdiverseprogramsandpolicies.Toalargeextent,thediverseplansmakeCignaaone-stopshopofsortsforinsuranceaswellashealthcareplans.Thisisacapabilitythatthecompanyshouldtapintoinseekingtoexploittheopportunityhighlightedinthiscase.PotentialBenefits1.ViabilityAsnotedearlier,halfofallAmericanshavetriedsometypeofCAM.Further,asasurveybyPEWResearchindicates,aboutafifthofAmericanssaytheyhavetriedalternativemedicineinsteadofconventionalmedicine;and,roughlythree-in-tenadultshavetriedalternativemedicineinconjunctionwithconventionalmedicaltreatment(PEWResearch,2017).Thus,theviabilityoftheideaproposedisnotinquestion.1.CompetitivenessThereisclearlyamarketthathasbeenneglectedandanopportunityignoredbythecompetition.Cignaoughttobethefirstmoveronthisfront.Inthiscase,thecompanywillbeabletorefineandperfectitscapabilitiesinthisparticularlineofservice.Asafirstmoverinthiscategory,Cignawill,thus,beabletogainacompetitiveadvantagethatwillenableittooutpacethecompetitiongoingforward.1.ReputationasaCulturallySensitiveEnterpriseTheworldhasessentiallybecomeaglobalvillage.Today,weliveinasocietythatcouldlargelybedefinedascosmopolitan.Inthepracticeofmedicine,likeinmanyotheraspectsofourcontemporarysociety,thereisneedforculturalhumilityandtolerance.WithmostkindsofCAMbeingculture-based,Cignawilleffectivelybedivertingtheconversationtowardsculturalhumilityandtolerance.Insodoing,itwilllikelybenefitbyhavingareputationasaculturallysensitiveenterprise.LevelofEffort/RequiredResources1.InfrastructureCostsThisbeingtherolloutofanewundertaking,thecompanywillspendsignificantresourcesintermsof;additionalresearch,humancapital,productdevelopmentandmarketing,operationalsupport,etc.1.ApproachInseekingtoimplementanundertakingofthisnature,Cignacouldembraceacase-by-casemodel.Here,thecompanywouldbereviewingrequestsforcoveragebytakingintoconsiderationindividualcircumstances.Insodoing,thecompanywillneedtocloselycooperatewithkeystakeholdersinhealthcaretoestablishtheviabilityoftreatmentalternatives.C:EntrepreneuralOpportunities7.VenturingIntoOtherInsuranceProductsOtherthanHealthInsuranceCignashouldconsiderofferingotherinsuranceproductsotherthanhealthinsurance.Forinstance,thecompanycouldventureintopropertyinsurance,fireinsurance,orevenpropertyandpoliticalviolenceinsurance(PVT).Thisismoresothecasegiventhatthiswouldtosomeextentinsulatethecompanyagainstshocksthatspecificallycouldhaveanimpacttothehealthinsurancesector.Forinstance,ifadverseregulationsrelatingtohealthinsuranceweretobeenacted,thenCignawouldlikelyridethewavewithoutnecessarilyhavingitsbottom-linesignificantlyaffected.1.DiversifybyAcquiringMajorityStakeinOtherNon-InsuranceBusinessesCignashouldalsoconsiderdiversifyingintoothermarketsoutsideoftheinsuranceindustry-withoutnecessarilyexitingtheinsurancebusiness.Forinstance,thecompanycouldseektoacquiremajoritystakeincompaniesorenterprisesofferingservicessuchassecurityorinfooddistribution.TherationalebehindthisproposalisthatCignawouldavoidbeingtooreliantonrevenuestreamssourcedfromtheinsurancebusinessmodelwhich,asthePESTanalysisindicates,couldbeimpacteduponbyvariousfactorsontheeconomic,political,andevensocialrealms.BurrowandKleindl(2014)notethatdiversificationaimstomaximizereturnsbyinvestingindifferentareasthatwouldeachreactdifferentlytothesameevent(p.113).1.RolloutHealthInsuranceProductsthatWouldAppealtotheYoungerPopulationAshasbeenrevealedbythePESTanalysis,availabledatasuggeststhatinasfarastheuptakeofhealthinsuranceisconcerned,ageisacriticalfactor.ThisismoresothecasegiventhatasCantiello,Fottler,OetjenandZhang(2015)observe,theleastlikelyagegrouptotakehealthinsuranceisthe18-24yearsagecategory.Beingcognizantofthisfact,Cignacoulddevelopinsuranceproductsdesignedtobringthisparticularsegmentofthemarketonboard.Ideally,thiswouldbeaplanindependentofthehealthplansthattypicallyoffercoveragetodependents.Anexamplewouldbeaproductthattargetsnewlyemployedyoungpersons.Thus,theproposedproductwouldinthiscaseincorporateservicesthatarespecificallyrelevanttoyoungpersons.Thesewouldideallybeinclusiveof:fitness(i.e.weightlosshelpservices),smokingcessationservices,pregnancycare,cholesterolchecks,electivecosmeticsurgery,etc.D:EntrepreneurialAssessmentTheentrepreneurialopportunityselectedfromthelistassessedaboveisventureintootherinsuranceproductsotherthanhealthinsurance.Onthisfront,therearevariousoptionsthatCignacouldselectfrom.Theseareinclusiveof,buttheyarenotlimitedto;propertyinsurance,fireinsurance,politicalviolenceinsurance,marineinsurance,etc.Theopportunityhighlightedinthiscaseisviableforanumberofreasons.Tobeginwith,itisimportanttonotethatatpresent,Cignahasastrongnetworkspanning50states.Further,thecompanyalsohasavastglobalnetworkwithsalesofficesinmultiplelocationsacrosstheworldincluding;theMiddleEastandAsia,Europe,andNorthAmerica.Thisgivesthecompanyreadyaccesstothesaidmarketstorolloutotherinsuranceproducts.Thus,Cignawouldnotbefacingsignificantentrybarriersinsuchmarketswhichwouldeaseitsintroductionoftheotherinsuranceproductshighlighted.Secondly,inrollingoutadditionalproducts,outsideofthehealthinsuranceproductsthatthecompanyhasinitsproductportfolioatpresent,thecompanywouldbeeffectivelyinsulatingitselffromthevariousfactorsandoccasionalshocks(outsideitscontrol)thatimpacthealthinsurance.Forinstance,thegovernmentcouldintroducelegislationthatspecificallyimpactshealthinsurance,i.e.aswasthecasefollowingthepassageoftheAffordableCareAct.Amongstotherthings,thisparticularlegislationmadeitunlawfulforhealthinsurancecompaniestoimposebothlifetimeaswellasannualcoveragelimitsontheofferedinsurancecoverageamount.InthewordsofWilenskyandTeitelbaum(2019),withoutannualorlifetimelimits,insurerswererequiredtopayoutmoreinclaimsthantheywouldhaveotherwise(p.79).Thiswouldessentiallyhaveanegativeimpactonprofitability.Third,theopportunitysuggestedcouldalsobedeemedviablegiventhatthecompanyalsopossessesstrongbrandrecognition.BrandrecognitionhasbeendefinedbyKenton(2018)astheabilityofconsumerstoidentifyaspecificbrandbyitsattributesoveranotherone.ItisimportanttonotethatCignahasbeeninoperationforthelast37years,sinceitsestablishmentin1982.Itsdedicationtotheimprovementofthehealthaswellaswellbeingofthemillionsofcustomersithasservedoverthelastthreedecadesmeansthatthosethecompanyhasimpacted(aswellasthegeneralpublic)canidentifywiththeCignabrandviathevariousslogansaswellaslogosandothervisualcuesassociatedwiththecompany.Thedistinctivetreeimageandgreen-bluecolorcombinationinitslogocouldbeeasilyberecognizedonthisfront.Thiseffectivelymakesiteasyforthecompanytointroducethesuggestedproductstotheverysameclienteleitserves(orthegeneralpublic).Indeed,inthewordsofBurrowandKleindl(2014),whenyoualreadyhaveastrongbrandandloyalcustomers,itisofteneasierandlessexpensivetointroducenewproductsortestthemoutbeforeyoufurtherinvestinthem(p.214).E:TrendsTherearevarioustrendsaffectingthehealthinsuranceglobalbusinessenvironment.Threeofthesewillbetakenintoconsideration:technology,consolidation,andnewentrants.Trendsintechnologyhappentohaveahugeimpactonmostindustriesandsectors.Thehealthinsurancedomainisnodifferent.AccordingtoSafi(2020),thehealthinsuranceindustry,acrosstheworld,isgoingthroughawaveofdigitaltransition,representinganeweraofhealthcareconsumerism.Theauthoridentifiesanumberofdisruptivetechnologiesthathaveanimpactonhealthinsuranceserviceprovidersacrosstheworld.Twoofthelistedtechnologiesaremobilesolutions(embeddedonmobiledevices),andcloudcomputing.Regardingnewentrants,thereisnodoubtthathealthinsuranceisaprofitableventurewithplayersinthemarketreportinggrowingprofitability.Forinstance,Cignasprofitsoverthelastthreeyearshavebeenontheincrease.Fortheyears2017,2018,and2019,thecompanyregisteredannualrevenuesof$41.806billion,$48.65billion,and$153.566billionrespectively(Microtrends,2020).Thisrepresentsanincreaseinprofitabilityof4.9%,16.37%and215.65%respectivelyoverthethree-yearperiod.TheincreaseinprofitabilityisnotuniquetoCignaalone.Asamatteroffact,manyotherhealthinsurancecompanieswithglobalpresencehavereportedincreasedprofitabilityinrecenttimes.AsAbelson(2020)pointsout,someofthelargestcompanies,includingAnthem,Humana,andUnitedHealthGroup,arereportingsecond-quarterearningsthataredoublewhattheywereayearago.SomeofthosethathavethrowntheirhatintothehealthinsuranceringwithinthelasttwoyearsareOscarHealth(whichisanewstartupintherealmofhealthinsurancethatbenefitedfromthebackingofAlphabet).Next,whenitcomestoconsolidation,Dafny(2015)pointsoutthatbiginsurersaretakingabreakfromthenewfiguringouthowtopayforvalue,ratherthanvolume,ofcareandgoingforthetriedandtrue:gobblingupsmallerinsurers.Inbasicterms,consolidationhasgottodowiththecombinationofanumberofenterprisestoformabiggerentity.Thereareanumberofadvantagesthatplayersinthehealthinsurancerealmseektoreapbyembracingconsolidation.Onesuchbenefitisthereductionofoperationalcosts.Consolidationalsoenableshealthinsurancecompaniestogoaroundcertainchallenges,i.e.barrierstoentryincertaingeographicalmarkets.Witheverincreasingcompetitioninthisparticularmarketdomain,ashasbeenhighlightedabove,consolidationisatrendthatwillcontinueshapingthehealthinsurancemarketgoingforward.F:ImpactonOpportunitiesThetrendshighlightedabovearelikelytohavevariedimpactontheentrepreneurialaswellasintrapreneurialopportunitiesidentified.Forinstance,consolidationandnewentrantsarelikelytonegativelyaffecttheentrepreneurialopportunityselectedinthesensethattheywillessentiallyincreasethealreadystiffcompetitioninthehealthinsurancerealm.Inasfarasconsolidationisconcerned,Boubakri,Dionne,andTriki(2020)arecategoricalthatoverthelastdecade,theinsuranceindustryexperiencedalargenumberofmergersandacquisitions(M&A)transactions(56).Ontheotherhand,technologyislikelytoaidtheentrepreneurialandintrapreneurialopportunitiesidentified.Thisismoresothecasegiventhatifembracedandimplementedwell,technologywouldmostlikelypromoteefficiencyandgiveCignaacompetitiveadvantageasitseekstorolloutotherinsuranceproductsotherthanhealthinsurance(entrepreneurialopportunity)andpioneerthecoverageofadditionalcomplementaryandalternativemedicineservices(intrapreneurialopportunity).G:ImpactonSustainabilityOnthesustainabilityfront,thetrendsidentifiedabovewouldalsohaveavariedimpactonthecontinuedperformance,competitivenessorlongevityofCigna.Ifthecmpanyisfastintheadoptionoftherelevanttechnology,itwouldbeabletoofferbetterservicestoitsclientseffectivelyensuringthatitissuccessfulinthelong-term.ThisismoresothecasegiventhatastheOrganizationforEconomicCooperationandDevelopmentOECD(2017)pointsout,technologicaladvancesintheinsurancesectorhaveresultedinpossibilitiesofnewmethodsofserviceprovisionaswellasgreateropportunitiesfordatacollectionthatcanleadtobetterriskidentificationandmitigationmeasures(7).Ontheotherhand,newentrantsarelikelytocomplicatetheoperationsoftheenterprisebecausetheentryofnewplayerseatsintotheincumbentsmarketshare.However,thecompanycouldcombineforces(viaconsolidations)withotherplayersintheindustrysoastointegrateprocessesandsystemsamovethatwouldhelpthecompanyimproveitsbusinessfunctionsandhence,fendoffcompetition.ReferencesAbelson,R.(2020).MajorU.S.HealthInsurersReportBigProfits,BenefitingFromthePandemic.TheNewYorkTimes.https://www.nytimes.com/2020/08/05/health/covid-insurance-profits.htmlBoubakri,N.,Dionne,G.&Triki,T.(2020).ConsolidationandValueCreationintheInsuranceIndustry:TheRoleofGovernance.JournalofBankingandFinance,32,56-68.Burrow,J.L.&Kleindl,B.(2014).BusinessManagement(13thed.).CengageLearning.Berschick,E.R.,Barnett,J.C.,&Upton,R.D.(2018).HealthInsuranceCoverageintheUnitedStates.USCensusBureau,ReportNo.P60-267Cantiello,J.,Fottler,M.D.,Oetjen,D.&Zhang,N.J.(2015).Theimpactofdemographicandperceptualvariablesonayoungadultsdecisiontobecoveredbyprivatehealthinsurance.BMCHealthServicesResearch,15(195),74-81.Cigna(2020).CompanyProfile.CignaCorporation.Retrievedfromhttps://www.cigna.com/about-us/company-profile/Cigna(2020).CignaAddsWellnessScreeningstoExpandingSuiteofVirtualCare.https://www.cigna.com/about-us/newsroom/innovation/cigna-launches-virtual-wellness-screeningsCigna(2015).2015PoliticalContributionsandLobbyingActivityReport.https://www.cigna.com/assets/docs/corporate-governance/political-contribution.pdfCigna(2015).CignaExpandsOfferingsforIndividuals-IncreasingAccesstoQualityCareinMoreCommunitiesAcrosstheCountry.https://www.cigna.com/newsroom/news-releases/2020/cigna-expands-offerings-for-individuals-increasing-access-to-quality-care-in-more-communities-across-the-countryCollins,S.R.&Gunja,M.Z.(2019).FindingsfromtheCommonwealthFundHealthInsuranceinAmericaSurvey,MarchJune2019.CommonWealthFund.https://www.commonwealthfund.org/publications/issue-briefs/2019/sep/what-do-americans-think-health-coverage-2020-electionDafny,L.S.(2015).TheRisksofHealthInsuranceCompanyMergers.HBR.https://hbr.org/2015/09/the-risks-of-health-insurance-company-mergersDeloitte(2018).UStaxreformimpactoninsurancecompanies.https://www2.deloitte.com/content/dam/Deloitte/us/Documents/financial-services/us-fsi-tax-reform-impact-on-insurance-companies.pdfEck,J.R.(2011).TheImpactofCultureonthePurchaseofLifeInsuranceinLatinAmericaandtheCaribbean.InternationalBusinessandEconomics,5(1),39-45.HealthCare.gov(2020).HealthInsurance.Retrievedfromhttps://www.healthcare.gov/glossary/health-insurance/Halter,C.(2018).40PercentofAmericansBelieveAlternativeTherapiesCanCureCancer.Retrievedfromhttps://www.cancerhealth.com/article/40-percent-americans-believe-alternative-treatments-can-cure-cancerHerman,P.M.&Courter,I.D.(2015).ComplementaryandAlternativeMedicine,ProfessionsOrModalities?PolicyImplicationsforCoverage,Licensure,ScopeofPractice,InstitutionalPrivileges,andResearch.NewYork,NY:RandCorporation.Hu,H.,Li,G.,Duan,J.&Arao,T.(2013).Prevalence,Purposes,andPerceivedEffectivenessofComplementaryandAlternativeMedicineUseinaHypertensionPopulation:AQuestionnaireSurvey.Retrievedfromhttps://www.hindawi.com/journals/isrn/2013/137472/Kenton,W.(2018).BrandRecognition.Investopedia.https://www.investopedia.com/terms/b/brand-recognition.aspLeonhardt,M.(2020).TheU.S.is\'officially\'inarecessionbuteconomistssayit\'sfarfromatypicaldownturn.CNBC.https://www.cnbc.com/2020/06/09/us-officially-in-a-recession-but-its-different-than-2008.htmlMicrotrends(2020).CignaRevenue2006-2020:CI.https://www.macrotrends.net/stocks/charts/CI/cigna/revenueNationalInstitutesofHealth(2020).WhiteHouseCommissiononComplementaryandAlternativeMedicinePolicy.Retrievedfromhttps://ods.od.nih.gov/HealthInformation/white_house_cam_commission.aspxOrganizationforEconomicCooperationandDevelopmentOECD(2017).TechnologyandInnovationintheInsuranceSector.Retrievedfromhttps://www.oecd.org/pensions/Technology-and-innovation-in-the-insurance-sector.pdfPatriciaM.&Coulter,I.D.(2016).AdvancingComplementaryandAlternativeMedicineProfessions:PractitionersFaceManyPolicyHurdlestoFindingTheirPlaceinMainstreamMedicine.SantaMonica,CA:RANDCorporation.Partridge,L.&Sinclair-Hunt,M.(2005).StrategicManagement.SelectKnowledgeLimited.Pal,A.(2019).HowTechnologyIsRevolutionisingHealthInsurance.OutlookMoney.https://www.outlookindia.com/outlookmoney/insurance/how-technology-is-revolutionising-health-insurance-3892Prindle,L.(2018).YourGuidetoAlternativeMedicineandHealthInsurance.Retrievedfromhttps://quotewizard.com/health-insurance/complementary-and-alternative-medicine-and-hea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