December 21, 2011

When John Defeo arrived at Cigna in late 2010 as VP for infrastructure, engineering and support, he faced the daunting task of preparing a comprehensive proof-of-concept for private cloud for the Bloomfield, Conn.-based health insurer. Now on the other side of the year-long endeavor -- and of a promotion to VP, infrastructure and services -- Defeo offers an optimistic assessment: "We went into this proof of concept thinking that we were behind the industry, and midway through it we discovered that we were closer to the front of the pack."

Private cloud is one of four key initiatives within an infrastructure and services transformation that Defeo will drive during 2012. The work is aimed at building the infrastructure needed to support Cigna's "individual-centric" strategy and CEO David Cordani's call to "go global, go deep, go individual," suggests Defeo.

"That strategy translates to an 'always-on' mentality, which further translates to mission-critical infrastructure," Defeo comments.

 John Defeo
John Defeo

Defeo comes to the task after a series of senior technology roles at financial services companies, including his most recent role as senior VP and CIO of Fidelity Investments. Defeo was previously CIO at Motorola as well as senior VP at AIG. "I'm accustomed to the need for systems characterized by high availability and resiliency," he comments.

Cigna's infrastructure program will pursue four key objectives across its initiatives: consolidation, standardization, automation and virtualization, Defeo relates. "Consolidation is about reducing power consumption and floor space in data centers, which reduces utility and facilities costs," he explains.

The ideal of standardization will reduce the variability of technology and expertise required to maintain it; automation will introduce a manufacturing-like efficiency to infrastructure development, speeding the deployment of infrastructure assets; virtualization will help to maximize utilization of assets, Defeo elaborates.

Cigna will begin deploying applications on its private cloud during 2012, resulting in a variety of benefits, according to Defeo. "It's going to decrease our cycle time for the delivery of technology solutions, it will enable us to more rapidly scale to meet periodic demands, and it's going to help us to drive standards throughout the technology landscape," he says. "When we're finished with this journey, a process like provisioning a server will happen in a couple of days rather than months -- that's the magnitude of improvement." Defeo says that the dimension of standardization within Cigna's cloud capabilities will enable the insurer to grow its infrastructure rapidly while maintaining a much slower rate of staff growth. The consolidation factor will bring further efficiencies.

"What we're seeing so far is a 40 to 50 percent reduction in data center floor space, a 30 percent reduction in power consumption, and an over 40 percent improvement in cycle time for delivering solutions to our business partners," Defeo reports.

Defeo says that another key initiative within Cigna's infrastructure transformation is "bullet-proofing" infrastructure supporting all customer-facing applications, making it more resilient within a 24/7 paradigm.

"Just to give one example, we have more than 8,000 employees around the world in our highly distributed operations organization workforce that takes customer calls for things such as claims inquiries and benefits entitlement information," Defeo says. "We have to maintain systems at a very high level of availability and performance, especially considering about 6,000 of those employees work from home."

Cigna's third major initiative will be to reengineer core operational processes, with the aim of improving customer responsiveness and service quality, and empowering the portions of Cigna's organization closest to its customers.

"It's about giving people such as our customer service center and help desk professionals the tools, knowledge and empowerment to be more responsive to our internal and external customers," Defeo explains. "Cigna has a somewhat unique model where our IT help desk takes calls not only from internal customers but also from end customers who might need help logging on to our web portal, for example."

Defeo's organization will answer CEO David Cordani's entreaty to "go global" through a transformational initiative aimed at reengineering the insurer's global network, which Defeo says was not optimized to meet the ambitious objectives of Cigna's new business plan.

"Our international business has grown 60 percent in the past year," Defeo comments. "The infrastructure was built for a smaller operation. Through acquisitions and joint vendors we've opened up in a number of different countries and our membership in those countries has grown by tens of thousands."

The network initiative is drawing to the end of its planning and testing phase and will move into deployment mode during 2012, according to Defeo. "We've already migrated several international locations and our first domestic location onto our new network," he says.

Defeo co-manages Cigna's infrastructure with the VP of Network Services, Rahul Singh, both of whom report to Cigna's CIO Mark Boxer. Singh has been driving a total transformation of Cigna's network infrastructure. A portion of the domestic and all of the international sites have been refreshed. The network initiative completes in 2012, according to Defeo. "Rahul's team has already migrated all international locations and many of the domestic locations onto our new network," he says. "That is a critical linchpin in achieving the vision of a new IT infrastructure."

ABOUT THE AUTHOR
Anthony O'Donnell has covered technology in the insurance industry since 2000, when he joined the editorial staff of Insurance & Technology. As an editor and reporter for I&T and the InformationWeek ...