Keith Gulledge & Ben Cook Consultants—Acumen Learning, LLC Manager Overview of Building Business Acumen Workshop

Day 1 welcomes you to Building Business Acumen “Seeing the Big Picture” July 23, 2013 FACILITATED BY: Keith Gulledge Acumen Learning, LLC Orem, Utah

3 Measuring Performance: 5 Key Business Drivers Statement of Cash Flows & Balance Sheet Income Statement (P&L) Balance Sheet 5 Key Business Drivers

Can a company have too much Cash ? $ $ $ $ $

PROFIT 10 PROFIT

6 What This Class is NOT Primarily About… 1.Skill training. 2.Accounting. 3.Finance. 4.Management techniques.

What This Class IS About at Cigna… 1.Seeing the Big Picture. 2.Leadership initiative. 3.Better decision-making. 4.Using 5-Driver knowledge for greater influence and results.

8 1.Know the measures important to senior executives, why they are important, and how you impact them 2.Understand 5 Key Drivers that all businesses focus on to succeed; how measured at Cigna & your influence on them 3.Better understand Cigna’s financial statements, how you impact them, and how you impact Cigna’s stock price 4.Enhance potential for increased credibility and influence by improving decision skills with tools & processes 5.Know how Cigna compares to your competitors—ID best practices, threats, weaknesses, opportunities 6.Understand basic business terms to better articulate company performance and teach others 7.Create an Action Plan to more positively impact Cigna’s desired results Program Objectives: To BETTER…

9 Business Acumen Topics 1.5 Key Business Drivers & How to Measure and Impact 2.Cigna Revenue Sources & Cost Centers—Profitability 3.Participant Functional Dynamics—How Cigna Internal Customers Can Work More Effectively Together 4.Cigna Annual & Quarterly Reports—Executive Messaging 5.Cigna’s Financial Statements: P&L, Balance Sheet, Statement of Cash Flows—Analysis & How to Impact 6.Decision Process and Basic ROI Analysis for More Effective Decisions to Impact 5 Drivers 7.Competitor and Industry Review, Analysis, Key Learnings 8.External Factors & Stock Market Dynamics 9.Learning Dynamics Activities—Teach to Learn, etc. Business Acumen Topics

10 MEASURING PERFORMANCE 21

11 Three Primary Financial Statements Statement of Income (P&L) Balance Sheet Statement of Cash Flows 1.Basic purpose & relationship to 5 Drivers 2.Governing equation 3.Key numbers, ratios and trends 4.Actions to impact results For each statement… Measuring 5-Driver Performance

B 2.35 B B 2.48 B B

Vote 13 What is the business term that refers to how well a company employs its Assets to make money? 13 1.Profit Margin 2.Asset Utilization 3.Cash Flow 4.Financial Leverage 5.Asset Strength

14 DECISION PROCESS

15 Decision Process 1 ID Desired Results  Stakeholder needs  Problem & root cause  Prioritize gaps & results—set targets Analyze ROI & Options  ST & LT impact  Qualitative aspects  Alternative solutions 3 Implement & Measure  Process owner  Involve key resources  Measurement, metrics 5 Make Decision  Who, how, when  Responsibility  Accountability 4 Use Data  Gather & distribute  Accurate, relevant  Timely, user friendly 2

16 Decision Mini-Case Analysis  Assignments for Case Analysis  In your Small Groups, use the Decision Process to analyze the entire case, focusing you your assigned Stage in the Decision Process Model  After 15 min., report your analysis to the larger group Use the Decision Process Analysis Worksheet p. 76 or 78

What Driver does Cigna’s Differentiated Value Proposition focus on? Customer-centricity

External Factors: COMPETITORS 39

19 Benchmarking Cigna’s Competitors  United Health  WellPoint  Aetna  Humana “Keep your friends close, and your enemies closer.” — Sun Tzu

Stock Price vs. Competitors—1 yr.

21 Profit  Discuss in your group how you personally can enhance REVENUE, reduce EXPENSES, and increase PROFIT  Write down one or more specific actions you could take to impact PROFIT (improve Revenue, reduce Expense) General areas to consider: Expenses you can influence Product value you can add Employee satisfaction & reten. Customer service & loyalty Action Journal Discussion & Notes11

22 Action Planning Form Complete an Action Planning Form for at least ONE initiative you’ve developed during this program.

days:Teach the principals you’ve learned to someone you work with. Teach to influence days: Discuss your Action Items with your manager. Follow through on your Action Items days:Review your Notes and Participant Guide days:Read “Seeing the Big Picture” if not completed. 5.Quarterly:2- 4 hours. Continue to use the resources available to build your business acumen. Review Cigna and competitor financials; use websites. 6.Ongoing: Teach others. Use Business Acumen in using the Decision Process. “What’s the impact on CASH, PROFIT, ASSETS, GROWTH and PEOPLE?” Post-Course Action Steps

24 2.Participants will be asked to schedule a meeting with you:  Share their key learnings from the workshop  Action Plan priorities and actions to be followed up  Teaching their team key concepts learned Your Questions & Comments 3.Your important guidance and support:  Feedback, suggestions on their Action Plan items—priorities  Support, direction and guidance, especially with cross- functional process and systems issues  Assistance with resources required  Help to free up their time for Action Plan items  Continued communication, feedback, support from you Your Needed Support as Manager 1.Prepare Participants for the class: Read the Book, more.