Blue Cross and Blue Shield of Florida implements a system for measuring and reporting alliance performance

Abstract

Purpose

Like many other organizations undertaking strategic alliances, Blue Cross and Blue Shield of Florida, Inc. (BCBSF) needed to effectively monitor alliance activities, or track their return on investment in those activities.

Design/methodology/approach

This case shows in detail how BCBSF developed a metrics framework, a standard set of value measures, and introduced a new alliance management software platform. By setting up this process, the company's Alliance Management Group helped the organization manage the value generated through its alliance relationships.

Findings

Key lessons learned about alliance software: Start simple and be flexible. Try to capture useful data and look for simple ways to aggregate it. Ensure that metrics are used to guide positive change, not to grade performance. Emphasize benefits of the metrics program to alliance managers. Be realistic about frequency of reporting cycles. Make subjective metrics more rigorous by having multiple points of review and require data to support metric conclusions.

Research limitations/implications

This is a case study produced by corporate managers of the firm. It has been peer reviewed but has not been subjected to independent audit.

Practical implications

Armed with the new analysis techniques and tools, alliance managers and enterprise alliance groups can gauge critical factors in the relationship that might seem too complex or subjective to measure. In the process, they can generate tremendous benefits and enhance corporate value in terms of operations, strategy and financial performance for both their companies and their partners.

Originality/value

By setting up an alliance monitoring system with sophisticated metrics, top management can routinely track: How alliances contribute to incremental revenues, enhanced profits, expanded customer base, and increased market penetration. How an alliance relationship is delivering not only financial, but also strategic value. Whether relationships with alliance counterparts are sound and based on a foundation of trust that will enable them to achieve their business objectives.

Citation

Booth, B., Finley, R. and McCredie, M. (2005), "Blue Cross and Blue Shield of Florida implements a system for measuring and reporting alliance performance", Strategy & Leadership, Vol. 33 No. 5, pp. 39-45. https://doi.org/10.1108/10878570510616870