Column: Risk Management

Know Your Weakest Links

By: | July 27, 2017 • 2 min read
Joanna Makomaski is a specialist in innovative enterprise risk management methods and implementation techniques. She can be reached at [email protected]

I worked in the oil and gas pipeline industry as a chief engineer. Prior to placing any pipeline system into the ground, we hydrostatically tested the pipe for 24 hours at increased pressures. We would fill the pipe system with water, hike up the pressure and watch for leaks or weaknesses in the pipe, joints or welds. This was an assurance test.


It warranted that the system, once operational, could take unexpected pressure. It highlighted in advance what weaknesses to expect so we could prepare to take appropriate action.

Fast forward to my days now in risk management. I again find myself conducting similar stress tests with financial institutions.

Instead of using water, we pressure up the organization using risk scenarios and test the effect on business processes and strategies and see if there exists adequate capital to support unexpected perils. We look to see where the organization springs leaks and we plug them.

For non-financial organizations, I think of airlines. Great benefits are derived from stress testing crew scheduling procedures for example.

What happens if you don’t get to stress test in time and your critical system functions and strategic controls come under severe or unexpected pressure?

We can simulate severe weather events and examine the effect on the potential cancellation or delay of thousands of flights.

Individual weather events don’t need to be overly extreme to cripple a crew-scheduling system. It’s good practice to model concurrent and multiple weather events to highlight more probable level of stress on, say, a staffing system.

Important questions to ask to start a stress test are:

  • What are our key business processes that support our strategy?
  • Do we have any new organizational norms or values?
  • What key strategy controls do we have in place?
  • How strong are these controls?

But what happens if you don’t get to stress test in time and your critical system functions and strategic controls come under severe or unexpected pressure?

As of late, one very large organization whose systems seem to be feeling such strategic pressures appears to be the U.S. government. The U.S. Constitution’s checks and balances act as democracy controls intended to tyrant-proof the whole operation.

But have these controls been stress tested knowing that the founding norms and beliefs are changing?


As such, are the Justice Department, law enforcement and regulatory systems still appropriate safeguards? Is the system abuse-proof? Is the system poised to spring a leak?

I am not a political scientist. I am a pipeline engineer who now does risk management. But the rules of good management and stress testing still apply.

Operating in an environment where systems and processes are under risky pressure can be perilous.  When the system starts sprouting leaks, is the plan to simply to put a finger in every hole? And what happens when we run out of fingers?

Risk lives in our weakest links and no matter what organization, it is best to be better prepared. &

More from Risk & Insurance

More from Risk & Insurance

Risk Management

The Profession

Janet Sheiner, VP of risk management and real estate at AMN Healthcare Services Inc., sees innovation as an answer to fast-evolving and emerging risks.
By: | March 5, 2018 • 4 min read

R&I: What was your first job?

As a kid, bagging groceries. My first job out of school, part-time temp secretary.

R&I: How did you come to work in risk management?

Risk management picks you; you don’t necessarily pick it. I came into it from a regulatory compliance angle. There’s a natural evolution because a lot of your compliance activities also have the effect of managing your risk.

R&I: What is the risk management community doing right?


There’s much benefit to grounding strategic planning in an ERM framework. That’s a great innovation in the industry, to have more emphasis on ERM. I also think that risk management thought leaders are casting themselves more as enablers of business, not deterrents, a move in the right direction.

R&I: What could the risk management community be doing a better job of?

Justified or not, risk management functions are often viewed as the “Department of No.” We’ve worked hard to cultivate a reputation as the “Department of Maybe,” so partners across the organization see us as business enablers. That reputation has meant entertaining some pretty crazy ideas, but our willingness to try and find a way to “yes” tempered with good risk management has made all the difference.

Janet Sheiner, VP, Risk Management & Real Estate, AMN Healthcare Services Inc.

R&I: What was the best location and year for the RIMS conference and why?

San Diego, of course!  America’s Finest City has the infrastructure, Convention Center, hotels, airport and public transportation — plus you can’t beat our great weather! The restaurant scene is great, not to mention those beautiful coastal views.

R&I: What’s been the biggest change in the risk management and insurance industry since you’ve been in it?

The emergence of risk management as a distinct profession, with four-year degree programs and specific academic curriculum. Now I have people on my team who say their goal is to be a risk manager. I said before that risk management picks you, but we’re getting to a point where people pick it.

R&I: What emerging commercial risk most concerns you?


The commercial insurance market’s ability to innovate to meet customer demand. Businesses need to innovate to stay relevant, and the commercial market needs to innovate with us.  Carriers have to be willing to take on more risk and potentially take a loss to meet the unique and evolving risks companies are facing.

R&I: Of which insurance carrier do you have the highest opinion?

Beazley. They have been an outstanding partner to AMN. They are responsive, flexible and reasonable.  They have evolved with us. They have an appreciation for risk management practices we’ve organically woven into our business, and by extension, this makes them more comfortable with taking on new risks with us.

R&I: Are you optimistic or pessimistic about the U.S. health care industry and why?

I am very optimistic about the health care industry. We have an aging population with burgeoning health care needs, coupled with a decreasing supply of health care providers — that means we have to get smarter about how we manage health care. There’s a lot of opportunity for thought leaders to fill that gap.

R&I: Who is your mentor and why?

Professionally, AMN Healthcare General Counsel, Denise Jackson, has enabled me to do the best work I’ve ever done, and better than I thought I could do.  Personally, my husband Andrew, a second-grade teacher, who has a way of putting things into a human perspective.

R&I: What have you accomplished that you are proudest of?

In my early 20s, I set a goal for the “corner office.” I achieved that when I became vice president.  I received a ‘Values in Practice’ award for trust at AMN. The nomination came from team members I work with every day, and I was incredibly humbled and honored.

R&I: What is your favorite book or movie?

The noir genre, so anything by Raymond Chandler in books. For movies,  “Double Indemnity,” the 1944 Billy Wilder classic, with insurance at the heart of it!

R&I: What is your favorite drink?


Clean water. Check out for how to help people enjoy clean, safe water.

R&I: What’s the best restaurant at which you’ve eaten?

Liqun Roast Duck Restaurant in Beijing.

R&I: What is the most unusual/interesting place you have ever visited?

China. See favorite restaurant above. This restaurant had been open for 100 years in that location. It didn’t exactly have an “A” rating, and it was probably not a place most risk managers would go to.

R&I: What is the riskiest activity you ever engaged in?

Eating that duck at Liqun!

R&I: If the world has a modern hero, who is it and why?

Dr. Seuss who, in response to a 1954 report in Life magazine, worked to reduce illiteracy among school children by making children’s books more interesting. His work continues to educate and entertain children worldwide.

R&I: What do your friends and family think you do?

They’re not really sure!

Katie Dwyer is an associate editor at Risk & Insurance®. She can be reached at [email protected]