Risk Management

The Profession

"Every experience — good, bad or indifferent — led me here and has put me in a position to make a real difference in our organization both personally and professionally."
By: | March 3, 2017 • 4 min read

 
R&I What was your first job?

I had a two-week stint at McDonald’s my freshman year of high school; so that probably doesn’t count. After that I worked as a server at a local restaurant.

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

I began as a multiline claims adjuster right out of college for three years. I then branched out and worked for a broker as a claims analyst and account executive for six and a half years before moving over to the employer side, first as the insurance and claims manager of a third party logistics’ risk management department and now as the risk manager of Staples.

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

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We are finally recognizing the value in going back to basics in the training and management of claims; as well as the importance of educating a corporation, from the executive level to the associate level, that risk management is more than just the department that secures insurance and manages workers’ compensation. We are now seen as the department that can actually improve the profitability of the organization.

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

Risk managers have to think outside the box to determine how we can pay for the programs and tools necessary to effectively manage the organization’s total cost of risk. We need to take the time to figure out what tools or programs truly make sense and will mesh into our company’s culture. Throughout my career I have seen many programs and initiatives quickly crash and burn because they were not properly vetted. When deciding what tool, program or initiative we want to pursue, we have to realize we have one shot to sell the message to make it a reality.

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

The focus on big data and data analytics. It was a long time coming and I am glad it is here, but we do have to ensure the data we are relying upon is accurate, which I believe is the next evolution in data analytics. I think we are all seeing there are many inaccuracies, various perspectives and gaps in the data we are relying upon.

R&I What emerging commercial risk most concerns you?

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I think the evolution of cyber risk will always concern me. I always say, “if only they would use their powers for good, they could cure cancer!”

However, with the fast-paced nature of change, [the challenge of staying] relevant is right up there with cyber. Our brand is so important. At the end of the day, it is the reputation of our company at stake. We have to ensure that each associate, no matter what position they hold in our organization, understands their importance. Every one of our actions and decisions individually and collectively impact our brand every day in some way.

R&I Are you optimistic about the U.S. economy or pessimistic and why?

I look at the direction Staples is headed and I cannot help but be excited and optimistic. Other companies are in our position and their associates are just as dedicated to the success of their respective organizations as we are.

R&I Who is your mentor and why?

My father is my mentor. He worked hard all his life and learned to make a way out of no way. I feel blessed and take pride in everything I do because of the lessons he taught me and continues to teach me every day.

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

I would say the evolution of my career to bring me where I am today. Every experience — good, bad or indifferent — led me here and has put me in a position to make a real difference in our organization both personally and professionally.

R&I How many emails do you get in a day?

Is this a trick question? In this day and age, I think all we can do is prioritize and manage email. My team is in the process of utilizing RMIS to automate a lot of processes in our department to cut down on the email traffic.

R&I What is your favorite book or movie?

“The Godfather,” hands down, is my favorite movie. If it is on, I have to watch it.

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

Rabot 1745 in London. All meals have a cocoa-based theme … yum!

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

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I love the Caribbean and love St. Martin (Dutch), Curacao and Puerto Rico. The landscapes and cultures throughout the Caribbean are very interesting to me.

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

Driving down to a local beach in Mexico at the age of 18 with two friends, and not turning back when we came upon Mexican military [stopping visitors at the entrance] to the beach. We then proceeded to camp out on the beach with strangers. I look back and realize how incredibly lucky we were that nothing happened to us!

R&I What about this work do you find the most fulfilling or rewarding?

I can make a positive difference to Staples and to our individual associates.

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

A majority of my friends and family know my job has something to do with insurance and claims but they don’t firmly grasp all that I am responsible for as a risk manager.




Katie Siegel is a staff writer at Risk & Insurance®. She can be reached at [email protected]

More from Risk & Insurance

More from Risk & Insurance

Robotics Risk

Rise of the Cobots

Collaborative robots, known as cobots, are rapidly expanding in the workforce due to their versatility. But they bring with them liability concerns.
By: | May 2, 2017 • 5 min read

When the Stanford Shopping Center in Palo Alto hired mobile collaborative robots to bolster security patrols, the goal was to improve costs and safety.

Once the autonomous robotic guards took up their beats — bedecked with alarms, motion sensors, live video streaming and forensics capabilities — no one imagined what would happen next.

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For some reason,  a cobots’ sensors didn’t pick up the movement of a toddler on the sidewalk who was trying to play with the 5-foot-tall, egg-shaped figure.

The 300-pound robot was programmed to stop for shoppers, but it knocked down the child and then ran over his feet while his parents helplessly watched.

Engaged to help, this cobot instead did harm, yet the use of cobots is growing rapidly.

Cobots are the fastest growing segment of the robotics industry, which is projected to hit $135.4 billion in 2019, according to tech research firm IDC.

“Robots are embedding themselves more and more into our lives every day,” said Morgan Kyte, a senior vice president at Marsh.

“Collaborative robots have taken the robotics industry by storm over the past several years,” said Bob Doyle, director of communications at the Robotic Industries Association (RIA).

When traditional robots joined the U.S. workforce in the 1960s, they were often assigned one specific task and put to work safely away from humans in a fenced area.

Today, they are rapidly being deployed in the automotive, plastics, electronics assembly, machine tooling and health care industries due to their ability to function in tandem with human co-workers.

More than 24,000 robots valued at $1.3 billion were ordered from North American companies last year, according to the RIA.

Cobots Rapidly Gain Popularity

Cobots are cheaper, more versatile and lighter, and often have a faster return on investment compared to traditional robots. Some cobots even employ artificial intelligence (AI) so they can adapt to their environment, learn new tasks and improve on their skills.

Bob Doyle, director of communications, Robotic Industry Association

Their software is simple to program, so companies don’t need a computer programmer, called a robotic integrator, to come on site to tweak duties. Most employees can learn how to program them.

While the introduction of cobots into the workplace can bring great productivity gains, it also introduces risk mitigation challenges.

“Where does the problem lie when accidents happen and which insurance covers it?” asked attorney Garry Mathiason, co-chair of the robotics, AI and automation industry group at the law firm Littler Mendelson PC in San Francisco.

“Cobots are still machines and things can go awry in many ways,” Marsh’s Kyte said.

“The robot can fail. A subcomponent can fail. It can draw the wrong conclusions.”

If something goes amiss, exposure may fall to many different parties:  the manufacturer of the cobot, the software developer and/or the purchaser of the cobot, to name a few.

Is it a product defect? Was it an issue in the base code or in the design? Was something done in the cobot’s training? Was it user error?

“Cobots are still machines and things can go awry in many ways.” — Morgan Kyte, senior vice president, Marsh

Is it a workers’ compensation case or a liability issue?

“If you get injured in the workplace, there’s no debate as to liability,” Mathiason said.

But if the employee attributes the injury to a poorly designed or programmed machine and sues the manufacturer of the equipment, that’s not limited by workers’ comp, he added.

Garry Mathiason, co-chair, robotics, AI and automation industry group, Littler Mendelson PC

In the case of a worker killed by a cobot in Grand Rapids, Mich., in 2015, the worker’s spouse filed suit against five of the companies responsible for manufacturing the machine.

“It’s going to be unique each time,” Kyte said.

“The issue that keeps me awake at night is that people are so impressed with what a cobot can do, and so they ask it to do a task that it wasn’t meant to perform,” Mathiason said.

Privacy is another consideration.

If the cobot records what is happening around it, takes pictures of its environment and the people in it, an employee or customer might claim a privacy violation.

A public sign disclosing the cobot’s ability to record video or take pictures may be a simple solution. And yet, it is often overlooked, Mathiason said.

Growing Pains in the Industry

There are going to be growing pains as the industry blossoms in advance of any legal and regulatory systems, Mathiason said.

He suggests companies take several mitigation steps before introducing cobots to the workplace.

First, conduct a safety audit that specifically covers robotics. Make sure to properly investigate the use of the technology and consider all options. Run a pilot program to test it out.

Most importantly, he said, assign someone in the organization to get up to speed on the technology and then continuously follow it for updates and new uses.

The Robotics Industry Association has been working with the government to set up safety standards. One employee can join a cobot member association to receive the latest information on regulations.

“I think there’s a lot of confusion about this technology and people see so many things that could go wrong,” Mathiason said.

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“But if you handle it properly with the safety audit, the robotics audit, and pay attention to what the standards are, it’s going to be the opposite; there will be fewer problems.

“And you might even see in your experience rating that you are going to [get] a better price to the policy,” he added.

Without forethought, coverage may slip through the cracks. General liability, E&O, business interruption, personal injury, cyber and privacy claims can all be involved.

AIG’s Lexington Insurance introduced an insurance product in 2015 to address the gray areas cobots and robots create. The coverage brings together general and products liability, robotics errors and omissions, and risk management services, all three of which are tailored for the robotics industry. Minimum premium is $25,000.

Insurers are using lessons learned from the creation of cyber liability policies and are applying it to robotics coverage, Kyte said.

“The robotics industry has been very safe for the last 30 years,” RIA’s Doyle said. “It really does have a good track record and we want that to continue.” &

Juliann Walsh is a staff writer at Risk & Insurance. She can be reached at [email protected]