Risk Insider: Grace Crickette

It’s Not Risk Management, it’s Change Management

By: | June 4, 2014 • 3 min read
Grace Crickette, a leader in enterprise risk management, is special administrator, Finance and Administration for San Francisco State University. She can be reached at [email protected]
Topics: Claims | ERM | Risk Insider

I might practice Risk Management, but I live Change Management.  Whether it is implementing a new loss control program, facilitating a session on risk appetite, or working on the annual budgeting process; I’m either dealing with change that is happening to me, or I’m trying to introduce change to someone else.

I’m always looking for a way to create a win for everyone involved, not offend others or be offended, and navigating my way to the path of least resistance.  The “way” usually involves listening and gaining understanding about what is important to the other person, a good dose of compromise and then adapting my language to the audience.

Not everyone has the same appreciation for risk or the same sense of urgency that I do.

John P. Kotter in his book, “Leading by Change” identifies the first step in creating lasting change as establishing a sense of urgency.  This requires examining  market and competitive realities and identifying and discussing crisis, potential crisis or major opportunities.

You always have to be mindful to create a sense of urgency without creating a culture of fear.

As risk managers, we don’t want to be known as “the boy who cried wolf,” or the bearer of bad news. Starting your conversation with, “don’t kill the messenger” is not a good risk mitigation tool.

I have had numerous situations where I knew that change was urgently needed, but was challenged with how to deliver the message without alienating my audience.  You always have to be mindful to create a sense of urgency without creating a culture of fear.

In one particular situation there was a significant financial deficit that in order to turn around would require significant change in how employees did their jobs. I gathered the group together and provided a theme based on the old Mission Impossible show, but with a twist…

Mission Possible

I leveraged our actuaries at the meeting to demonstrate the “market analysis and competitive realities,” clearly demonstrating that if we continued with business as usual the deficit was going to continue to grow.

One key component to the Mission was that we needed to get claims closed.  One individual stood up and asked, “ … but if we close the claims, what will I do?”

I responded that if we changed our claims management strategy there would be a reduced need for time to be spent on claims (I was honest), but that it would free employees to focus on loss prevention.  I then went on to introduce a new safety program in which all the employees would be engaged in the opportunity piece of the equation.  The individual who expressed their fear of change went on to be a huge success in their organization, reducing employee injuries, reducing the financial deficit and in turn was promoted.

Key Takeaway:  Create a sense of urgency

Mission Possible: Provide data analysis, anticipate the fear, and be ready with a solution to address that fear.

Remember – It’s not Risk Management, its Change Management!

Read all of Grace Crickette’s Risk Insider contributions.

2018 Risk All Stars

Stop Mitigating Risk. Start Conquering It Like These 2018 Risk All Stars

The concept of risk mastery and ownership, as displayed by the 2018 Risk All Stars, includes not simply seeking to control outcomes but taking full responsibility for them.
By: | September 14, 2018 • 3 min read

People talk a lot about how risk managers can get a seat at the table. The discussion implies that the risk manager is an outsider, striving to get the ear or the attention of an insider, the CEO or CFO.

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But there are risk managers who go about things in a different way. And the 2018 Risk All Stars are prime examples of that.

These risk managers put in gear their passion, creativity and perseverance to become masters of a situation, pushing aside any notion that they are anything other than key players.

Goodyear’s Craig Melnick had only been with the global tire maker a few months when Hurricane Harvey dumped a record amount of rainfall on Houston.

Brilliant communication between Melnick and his new teammates gave him timely and valuable updates on the condition of manufacturing locations. Melnick remained in Akron, mastering the situation by moving inventory out of the storm’s path and making sure remediation crews were lined up ahead of time to give Goodyear its best leg up once the storm passed and the flood waters receded.

Goodyear’s resiliency in the face of the storm gave it credibility when it went to the insurance markets later that year for renewals. And here is where we hear a key phrase, produced by Kevin Garvey, one of Goodyear’s brokers at Aon.

“The markets always appreciate a risk manager who demonstrates ownership,” Garvey said, in what may be something of an understatement.

These risk managers put in gear their passion, creativity and perseverance to become masters of a situation, pushing aside any notion that they are anything other than key players.

Dianne Howard, a 2018 Risk All Star and the director of benefits and risk management for the Palm Beach County School District, achieved ownership of $50 million in property storm exposures for the district.

With FEMA saying it wouldn’t pay again for district storm losses it had already paid for, Howard went to the London markets and was successful in getting coverage. She also hammered out a deal in London that would partially reimburse the district if it suffered a mass shooting and needed to demolish a building, like what happened at Sandy Hook in Connecticut.

2018 Risk All Star Jim Cunningham was well-versed enough to know what traditional risk management theories would say when hospitality workers were suffering too many kitchen cuts. “Put a cut-prevention plan in place,” is the traditional wisdom.

But Cunningham, the vice president of risk management for the gaming company Pinnacle Entertainment, wasn’t satisfied with what looked to him like a Band-Aid approach.

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Instead, he used predictive analytics, depending on his own team to assemble company-specific data, to determine which safety measures should be used company wide. The result? Claims frequency at the company dropped 60 percent in the first year of his program.

Alumine Bellone, a 2018 Risk All Star and the vice president of risk management for Ardent Health Services, faced an overwhelming task: Create a uniform risk management program when her hospital group grew from 14 hospitals in three states to 31 hospitals in seven.

Bellone owned the situation by visiting each facility right before the acquisition and again right after, to make sure each caregiving population was ready to integrate into a standardized risk management system.

After consolidating insurance policies, Bellone achieved $893,000 in synergies.

In each of these cases, and in more on the following pages, we see examples of risk managers who weren’t just knocking on the door; they were owning the room. &

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Risk All Stars stand out from their peers by overcoming challenges through exceptional problem solving, creativity, clarity of vision and passion.

See the complete list of 2018 Risk All Stars.

Dan Reynolds is editor-in-chief of Risk & Insurance. He can be reached at [email protected]