UnitedHealth Group has created a chief administrative officer position and appointed Jodee Kozlak to it, consolidating four corporate functions under a single executive at a company that employs several hundred thousand people.
The role took effect in late September and covers people, real estate, procurement and corporate security. Each of those has historically reported separately at large American health insurers, and bringing them together under one officer is a structural change rather than a personnel one.
Kozlak spent most of her career at Target Corporation, where she was executive vice president and chief human resources officer, a role that covered a workforce comparable in scale to UnitedHealth's and spanning stores, distribution and corporate functions. She subsequently served as global senior vice president of people at Alibaba Group. She is also a lawyer by training and has sat on the board of the logistics company C.H. Robinson since 2013.
Why the role exists
Creating a chief administrative officer is usually a response to one of two problems. The first is span of control at the chief executive level, where a growing number of corporate function heads reporting directly becomes unmanageable. The second is a judgement that the functions themselves are poorly coordinated and that decisions about workforce, physical footprint and purchasing are being made in isolation from one another.
The combination chosen here points to the second. People, real estate and procurement are the three largest controllable cost lines in a services business after the cost of the service itself, and they interact directly: where people work determines what property is needed, and both determine a large part of what is bought. Putting them under one executive is a cost-discipline structure.
The inclusion of corporate security alongside them is the detail that distinguishes this appointment from a conventional administrative consolidation, and it reflects a changed operating environment for American health insurers.
Context at the company
UnitedHealth has spent recent periods under exceptional external pressure, including regulatory attention to its practices, litigation and intense public argument about claim denials and the economics of managed care. Companies in that position typically strengthen the corporate centre, because the functions that manage workforce, facilities and supplier relationships are the ones that absorb the operational consequences of external scrutiny.
Hiring from outside health insurance is consistent with that reading. Kozlak's experience is in large-scale retail and technology workforces rather than in managed care, which suggests the board and chief executive wanted general administrative capability at scale rather than sector knowledge.
Scope
The company described the position as newly created and did not indicate that any existing executive had been displaced by it. Function heads in the four areas now report through the new role rather than directly to the chief executive.
