A culture of engagement and inclusion

Responsible for human resources practices, recruitment and retention, organization development, professional development and associate information services, Humana’s Senior Vice President and Chief Human Resources Officer Bonnie C. Hathcock balances her busy workload by staying focused on the human resources priorities, which drive business growth. “My executive team and I have introduced an HR organizational model with a governance structure that allows us to systematically identify and evaluate opportunities where HR can contribute strategically to the business,” she says.

One of her goals is to provide focus on what is important rather than urgent. “Second,” she adds, “I have a very talented executive team. Together, we agree on the strategic direction and then they are given the freedom to accomplish their objectives in the way they see best as leaders. I keep track of major initiatives through weekly staff meetings and bi-weekly one-on-ones.”

Looking back

Several years ago, Humana was facing the same challenges as other companies across the country with health care costs rising exponentially every year. Mike McCallister, Humana’s CEO, challenged Hathcock to come up with a completely new approach to the company’s benefits design, one that would work for associates and customers. This lead to MOCHA (More Options and Choices for Humana Associates), Humana’s internal benefits brand.

“I put together a cross-functional team which came up with a new design that provided an array of options, many of which really broke the mold at that time. We migrated the enrollment process on-line and engaged our associates in an innovative way to choose, finance and use their benefits. The result was a cost trend under five percent rather than the predicted 19 percent.”

When Humana introduced MOCHA, the company took a ‘laboratory-to-showcase’ approach. “Our objective was to create a bold new benefits plan, test it with our associates in the form of a laboratory, and share the knowledge we gained with our customers during the showcase phase. MOCHA became the basis for a series of consumer-focused health plans marketed to Humana customers as ‘Smart’ products. It has been very successful. Customers using these products have significantly reduced their cost trends.”

A cultural transformation

Through projects like MOCHA, Hathcock has achieved a wide-ranging cultural transformation at Humana since she began nearly nine years ago. Humana has always had talented HR people, she points out. “However, when I arrived, the function was in a bit of disarray. What epitomized this for me was the state of the employee file room where there were boxes piled high to the ceiling overflowing with employee data. We went to work bringing order and discipline to the function.”

Hathcock engaged the team in creating a vision about what the future could be, the value that strong HR leadership could bring to the company, and the power of a robust human capital platform. “We reorganized the function, establishing HR ‘business consultancies’. We drove the development of a human capital agenda which aligned with the goals of the business. Over the years, we’ve seen a change in the company with our key leaders embracing the role that human capital plays in advancing their business goals and transmitting these values to their leaders.”

Humana has achieved business success because the company has focused on its people, Hathcock emphasizes. Several years ago, she introduced an associate value proposition within Humana: that associate value drives customer value, which drives shareholder value. “It’s reflective of my strong belief that when an organization truly values and respects its associates, its business will realize significant value in the marketplace. The associate value proposition is the underlying principle behind our HR strategy.”

Consumerism

There are a number of initiatives Hathcock has introduced at Humana, but which ones does she feel particularly proud of? “The creation of the Humana Leadership Institute is one,” she answers. “Several years ago, our CEO put forward a bold new strategic vision, now known as consumerism. Consumerism was new for the company and the industry at that time. The leadership team recognized that this change required a new set of leadership competencies to execute on this strategy. We launched the Leadership Institute with the goal of developing those competencies and creating a learning organization.”

The Leadership Institute has had significant business impact, directly leading to initiatives which have incubated ideas, including a Perfect Service initiative which has been launched across the enterprise. “Another success story is our work in associate engagemen,” Hathcock adds. “We began engaging associates in our benefits redesign when I first joined Humana. Over the years, engagement has spanned numerous fronts. We have since formalized our approach, working closely with business unit leaders to measure and improve engagement throughout the organization. We have had great success, increasing engagement with improvement results twice that of the average participating company over a one-year period.

“The groundwork we laid with engagement contributed directly to our ability to capture the second-largest national market share among health benefits companies competing for new Medicare business. I am also excited about the work we are doing to integrate Engagement with our Diversity and Inclusion strategy,” she says.

Support from the top

The support of CEO Mike McCallister has been critical for Hathcock. “When Mike and I first started working together, I would talk with him about my vision for human capital and plans for the HR function. Mike has an accomplished operational and business unit background and, at first, he thought what he was hearing was a little ‘squishy’. But he trusted me and gave me the green light to go with it. We have a terrific partnership and he is a big champion of the work we do. Achieving change on an enterprise-wide scale requires that type of partnership and support.”

With Humana’s Medicare business doubling in size and revenues over the past two years, the company has experienced rapid growth. Humana has been hiring up to 5000 new employees annually. This has also posed challenges. “Our challenge is to acquire talent in time to meet the business needs and to assimilate that talent in a way which maintains and strengthens the culture we have worked so hard to cultivate. At Humana, assimilation begins right away – each associate is required to participate in an onboarding session designed to educate them about our company’s history, strategy and values.”

Culture is crucial at Humana. It defines what is important, what is acceptable and what is expected. Hathcock describes it as a two-way street between leaders and associates. “Our leaders are expected to create an environment in which an associate will be inspired to bring their ‘A’ game to work each day. We communicate our culture to all associates beginning with the onboarding process, and continuously reinforce these expectations through our leadership development programs and associate communications.”

In addition to educating associates about Humana’s strategy and business philosophy, the company aims to create a culture of engagement and inclusion. “We have also taken an innovative approach to driving culture through the design of our workplaces. One important part of my responsibility is to manage our real estate portfolio. Looking through a human resources lens, we approach workplace design with the goal of encouraging collaboration and innovative thinking.”

About Bonnie Hathcock

Bonnie Hathcock, Humana’s SVP and Chief Human Resources Officer, joined the company in 1999. Working to instill a culture of engagement throughout the company, she has been instrumental in creating a powerful integrated people system that stands as a competitive advantage, distinguishing Humana from its competition.