DDBA 8582 Week 3 Flexibility Audit Example

How Much Flexibility the Insurer Already Owns: A Current State Audit Counting Cross-Qualified People, Scalable Contract Capacity and the Speed of Internal Moves for Work That Cannot Stop, Then Running the Three Scenarios Against the Counts

Student Name

Walden University

DDBA 8582: An HR Plan for Organizational Agility

Instructor Name

Month Day, Year

How Much Flexibility the Insurer Already Owns: A Current State Audit Counting Cross-Qualified People, Scalable Contract Capacity and the Speed of Internal Moves for Work That Cannot Stop, Then Running the Three Scenarios Against the Counts

Scope

The audit covers six activities at the composite Iowa health insurer that cannot pause for more than a few days without regulatory penalties, contract breaches or harm to members: claims adjudication, member services telephones, utilization review, enrollment processing, provider payments and the printing and mailing of member ID cards. Other work, such as marketing and internal reporting, can be delayed during a surge and is excluded. Lepak and Snell (1999) argued that the right employment arrangement depends on how valuable and how firm-specific the work is; the activities in scope here are both, which is why their flexibility deserves a separate count.

Absorption Table

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Counts come from the learning management system's qualification records, the two staffing agency agreements and the human resources system's transfer history for the past three years.

Table 1

Capacity to Absorb Change in Work That Cannot Stop

Strain Register

Present symptoms show where the arrangement is already thin. In utilization review, 9 of 61 reviewers worked more than 300 overtime hours last year, and three of them account for a fifth of all review overtime. In provider payments, two staff approve all payments above $50,000, and a vacation by either delays them. Claims adjudication carries a backlog of 6 days against a 4-day standard every January. Member services abandons 11 percent of calls during open enrollment.

Running the Scenarios

Scenario A, a large client in 150 days, needs 46 claims handlers and 18 member services staff. Agency capacity covers 20 and 30 respectively within a month, and internal transfers add 11 qualified people. Claims falls about 15 short, and agency temporary staff need the same 10 weeks of training as transfers, so the binding constraint is training capacity, not headcount.

Scenario B, certifying 39 reviewers in 270 days, strains utilization review, where no one outside the unit is qualified and contract capacity is 6. The unit cannot release 39 people to study without falling behind, and overtime is already concentrated in a few people.

Scenario C, shifting 40 people from Medicare supplement to group administration in 120 days, depends on internal transfer speed. Transfer history shows that the 10-week ramp for claims work, plus an average of five weeks to approve a transfer, consumes the whole window.

What the Audit Shows

The insurer owns substantial numerical flexibility in phones and enrollment through agency agreements, little functional flexibility outside member services and enrollment, and almost none in utilization review and provider payments. Kalleberg (2001) noted that firms often combine the two forms unevenly across their workforce; this insurer's unevenness falls exactly where its scenarios hurt. Even modest cross-training (Hopp & Van Oyen, 2004) can absorb much of the variability in staffing, which suggests the gaps in claims and provider payments could be narrowed cheaply.

What the Counts Do Not Show

The absorption table records how many people are qualified, not how willing they are to move or how their own units would cope without them. The 11 member services staff qualified for claims work are also the people member services relies on during its January peak, which coincides with the claims backlog. Their qualification is real but their availability in January is doubtful. The audit therefore treats them as available for Scenarios B and C, which strain other seasons, and only partly for Scenario A.

Readiness of the Qualified

A sample review of the 11 cross-qualified member services staff found that four had not handled a claim in over a year and would need refresher training before counting as available.

Limits

Qualification records may overstate readiness: a person trained two years ago may need refreshing. Agency lead times are contract terms, not tested performance.

References

Hopp, W. J., & Van Oyen, M. P. (2004). Agile workforce evaluation: A framework for cross-training and coordination. IIE Transactions, 36(10), 919-940. https://doi.org/10.1080/07408170490487759

Kalleberg, A. L. (2001). Organizing flexibility: The flexible firm in a new century. British Journal of Industrial Relations, 39(4), 479-504. https://doi.org/10.1111/1467-8543.00211

Lepak, D. P., & Snell, S. A. (1999). The human resource architecture: Toward a theory of human capital allocation and development. Academy of Management Review, 24(1), 31-48. https://doi.org/10.5465/amr.1999.1580439