Rapid acquisitions have made Molina Healtchcare one of the nation's top 15 healthcare companies and one of the nation's 100 fastest-growing targeting inner cities.
The acquisitions that account for 85% of Molina's growth also drove Molina's business strategy into conflict with its growing telecommunications infrastructure, however.
Each new acquisition brought with it a new PBX system that had to be integrated into the firm's call center operations -- a goal never fully realized, due to technical differences between the systems.
That left Molina, a $1.6 billion managed-care company with facilities in eight states, serving 900,000 members, with eight independent telephony systems, many of which couldn't even switch a call to another system, or another Molina facility.
"The business perspective should lead the technical perspective," said Rick Click, Molina's CIO. "Yet with each new acquisition, our telephony platform further diverged from our business strategy -- which is to work in a centralized environment across eight states. We were buying companies and inheriting all manner of telephony systems, and each one further decentralized operations. We were having a great deal of trouble managing across multiple contracts."
Each system came with different applications, different voice mail systems and different customer interfaces. There was no uniform way for customers traveling state to state to access Molina for services. Employees at one location couldn't forward calls or voice mails to people at another Molina site.
And incoming calls were handled irregularly, depending upon which facility customers happened upon. Voice mail systems didn't offer the same menu options or branching structures, making the customer experience inconsistent and fragmenting Molina's branding. Worse, it was becoming difficult, in some cases, for customers to quickly access the services they required.
Just keeping the systems running was an expensive strain on Molina's IT department. The company had to employ skilled administrators at locations across eight states; sustain eight employee training programs; pay eight maintenance contracts; and foot the bill for running telephone lines, local calls and long distance service.
"It was just a costly model to support, and with their rapid growth, that cost was going to spiral," said Kristen Jacobsen, director of marketing for Spanlink, a contact center solution provider that helped Molina with its PBX conversion project, in Minneapolis, Minn. "They simply had to make a change."
Intense pain, radical solution
Molina's managers recognized they needed to standardize and centralize the company's telephony platforms onto a single voice over Internet Protocol (VoIP) system. The decision itself wasn't difficult or particularly unusual in technical terms
What was radical, and risky, was the aggressive, six-month deadline the company set itself to to VoIP -- a project that, company officials admit, should have been budgeted for 12 to 18 months.
Despite their best efforts -- partnering with a leading solution provider, choosing best-of-breed hardware and software platforms, extensive up-front planning and adherence to documented best-practices for the rollout -- the deployment proved painful.
"One of the really big issues we were concerned with was how quickly we could get this solution implemented," Click said. "We forced it in within six months -- and I'm not sure that's the direction I'd take if I were to undergo this project again, but nonetheless, that's the way we went."
Job one: Map the organization's telephony lifecycle, to ensure the future telephone network would be properly aligned to support the business workflow. Click's IT team dispatched analysts to every Molina site in every state -- 29 major facilities, plus myriad nurse practitioners with small or home offices -- and recorded how each conducted business.
The result was a list of dozens of maps created to identify the most efficient routing to match calls to the Molina resources the callers were seeking. The company then consolidated those into a single design and lifecycle plan, and launched a gap analysis to determine how effective the plan was, and type of technology solution would be required to provide the functionality and core telephony resources Molina needed.
Once the actual system requirements were qualified, the team hammered out an estimate on the cost of the proposed solution. To cut costs and speed ROI, the sale of the existing PBX systems was factored in. The team also covered their bases by benchmarking the projected design against systems used by other companies with similar business requirements and running a risk analysis.
Lastly, the IT team evaluated the skill sets available in-house, and compared them to the skill sets needed to implement and maintain the new network. Only after all of those processes were completed, and the attributes in place, did Molina conduct an RFP.
Vendor, user, VAR: three teams, one goal
Molina ultimately selected Spanlink to design and deploy the system. But it also planned to have Spanlink train its internal IT organization so that when the VoIP network was in place, Molina's own staff would assume day-to-day operational responsibilities.
For the hardware and system software, Cisco Systems Inc., was a logical choice partly because Molina was already a Cisco shop, and Spanlink's solutions were built on the Cisco platform.
"Implementing voice over IP requires a different set of skills," Click says. "We didn't have the skills in-house. We were relying heavily on third-party consultancies, and nobody likes to be in that situation. So in addition to rolling out the project and working through any problems, we planned intense training of our internal folks to happen concurrently with the project roll out. With our tight timeline, that only added to the pressure."
Given the high-stakes schedule, the players developed a specialized deployment approach. It involved three full-time teams from Cisco, Spanlink and Molina, all operating under the umbrella of a single PMO (program management office).
Molina's team decided the most time-efficient approach would be to "force the system in using an 80/20 rule, and go back and work out the problems as the system is running, after it's been rolled out," Click said. "Our objective was to get it in. We knew there would be fallout. We knew there would be issues that we had to manage."
To accelerate the process even further, Click's group established a "shark tank" in which each piece of the overall solution would be assembled, configured, tested and debugged. Once a solution component was ready, it would be shipped off to a location for installation and switched on. Then the shakedown would begin.
This, Click explained, kept all the configuration problems in one location, and allowed the teams to work off the same project plan, error sheets and troubleshooting sheets. Issues were prioritized from 1 through 4, and communicated through a tightly managed communication channel.
In fact, the team assigned two people full-time to do nothing more than communicate. These technicians generated documentation to the organization, letting them know what was happening; when it was happening; what they could expect; what were the avenues to results; short-, mid-, and long-term problems; and so on.
Jumping the shark
"The shark tank was crucial if this project was to succeed," Click said. "We took on the process of buying the appropriate hardware, conducting the appropriate training, actually breaking it out and rolling it out, conducting the training on-site, and mapping out the problems as they occurred," Click said.
Despite their best-laid plans, however, facilities in the first state to be rolled out -- Washington -- did not fare well. "It was quite difficult, to say the least," Click said. "We had a lot of problems with latency. We had a lot of problems with noise. And we had a huge problem with the headsets not functioning. We were told to expect a failure rate of about 3%. The hardware error was more like 13.5%. It was exceptionally difficult."
The teams also discovered its routing plans had to be revisited -- to reduce latency and congestion -- a big surprise that had to be fixed before any of the rest of the network was rolled out. But perhaps the biggest challenge had nothing to do with the technology and everything to do with human nature. As people were trained on the new system, resistance to change emerged.
"It's difficult to teach a company how to leverage a new system, because you're asking them to change the way they do the day-to-day work of setting up conference calls, getting voice mail, transferring calls, things of this nature," Click said. "We actually had to go in and cut off the other ways people were doing conference calls, because we weren't getting ROI in this area and, after due diligence, we determined people were still using the old system. So we had to get rid of it."
Yet despite what Click called a "real tough scenario," the teams quickly recognized the divide-and-conquer methodology they opted for at the outset was the right call. "As we were troubleshooting [Washington], there were a lot of engineers that couldn't add value, so we stuck with the six-month project plan, and had them go immediately to the next site and start their process," Click said.
In the end, the pain was worth it. The teams hit the six-month timeline. Molina consolidated its telecommunication operations and billing, and is now reaping "double-digit savings," Click said.
The company totally eliminated inter-company long distance charges across eight states. And it was able to refocus its staff of PBX admins on more productive work.
Most important, Molina built a consolidated, common call flow, providing a uniform customer service experience across the organization, regardless of where the calls originate. "We're in a position now where we have this rolled out across all eight states, and have 99-plus-percent of the kinks worked out," Click said. "Now we're going to be taking it to the next level."
Now on the radar: monitoring systems, disaster recovery, a hardware maintenance module, hand-managed devices that can utilize the BlackBerry, video conferencing -- all of these and more are under consideration for deployment in 2007.
"We wanted a system that was going to complement our acquisition strategy, and allow for us to grow moving forward," Click said. "And that's exactly what we got."