Column: Risk Management

Becoming Great

By: | March 5, 2018 • 2 min read

Joanna Makomaski is a specialist in innovative enterprise risk management methods and implementation techniques. She can be reached at [email protected]

We’ve all heard the re-run of Ronald Reagan’s 1980 campaign slogan — “Let’s Make America Great Again.”

Some tend to examine the word “again” as implying a throwback era where America was “great.”

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One of my favorite business books comes to mind when I hear this catchphrase. “Good to Great” by Jim Collins has acted for many years as a best practice road map to superior risk management. In it, Collins asks: “Can a good company become a great company, and if so, how?”

What makes an organization great according to Collins? After analyzing more than 1,400 companies, he looked for those that have stood the test of time in performance and results. Great companies had 15-year cumulative stock returns at or below the general stock market; but in the subsequent 15 years, the same returns grew to three times that of the general market.

Collins’ study revealed key traits, like having humble leaders, driven to do only what is best for the organization and nothing else. Also finding the right, self-driven people for the job — no matter how long it takes. In Collins’ words: “Get the right people in the right seats on the bus.”

If America is on a journey to becoming “great” again, how are its risk management practices progressing? How good are we at facing brutal facts? Do we have the right people in the right seats on the proverbial government bus? How disciplined  are decisions and behaviors? Are people motivated and held accountable for their actions?

Two other characteristics identified by Collins speak loudly to my risk management experience. He said great companies confront the brutal facts head on and act on them. They also rigorously promote a culture of discipline — where disciplined people have disciplined thoughts and take disciplined actions.

This doesn’t mean dictatorship; it’s not about imposing behaviors or rules but “creating systems and processes that keep teams motivated yet accountable.”  Isn’t that great risk management?

Risk management is a disciplined, logical system that sets context, and analyzes, treats and communicates risks for any activity, function or process — all to help an organization navigate successfully toward its goals. If that is the case, becoming great requires risk management.

If America is on a journey to becoming “great” again, how are its risk management practices progressing? How good are we at facing brutal facts? Recognizing facts? Doing something in response to facts? Do we have the right people in the right seats on the proverbial government bus?

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How disciplined and orderly are decisions and behaviors? Are institutional systems and disciplined processes in place? Are people, within these systems, motivated and held accountable for their actions?

When I think of attempts by Congress to dismantle the Dodd-Frank Wall Street Reform and Consumer Protection Act, I wonder if we have genuine intention for effective risk management.

The Dodd-Frank act brought risk management reforms to the financial system following the 2008 credit crisis, born from high-risk financial products, conflicts of interest and the failures of institutions, such as regulators and credit rating agencies.

If risk management in America is at risk, can America ever be great again? &

More from Risk & Insurance

More from Risk & Insurance

4 Companies That Rocked It by Treating Injured Workers as Equals; Not Adversaries

The 2018 Teddy Award winners built their programs around people, not claims, and offer proof that a worker-centric approach is a smarter way to operate.
By: | October 30, 2018 • 3 min read

Across the workers’ compensation industry, the concept of a worker advocacy model has been around for a while, but has only seen notable adoption in recent years.

Even among those not adopting a formal advocacy approach, mindsets are shifting. Formerly claims-centric programs are becoming worker-centric and it’s a win all around: better outcomes; greater productivity; safer, healthier employees and a stronger bottom line.

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That’s what you’ll see in this month’s issue of Risk & Insurance® when you read the profiles of the four recipients of the 2018 Theodore Roosevelt Workers’ Compensation and Disability Management Award, sponsored by PMA Companies. These four programs put workers front and center in everything they do.

“We were focused on building up a program with an eye on our partner experience. Cost was at the bottom of the list. Doing a better job by our partners was at the top,” said Steve Legg, director of risk management for Starbucks.

Starbucks put claims reporting in the hands of its partners, an exemplary act of trust. The coffee company also put itself in workers’ shoes to identify and remove points of friction.

That led to a call center run by Starbucks’ TPA and a dedicated telephonic case management team so that partners can speak to a live person without the frustration of ‘phone tag’ and unanswered questions.

“We were focused on building up a program with an eye on our partner experience. Cost was at the bottom of the list. Doing a better job by our partners was at the top.” — Steve Legg, director of risk management, Starbucks

Starbucks also implemented direct deposit for lost-time pay, eliminating stressful wait times for injured partners, and allowing them to focus on healing.

For Starbucks, as for all of the 2018 Teddy Award winners, the approach is netting measurable results. With higher partner satisfaction, it has seen a 50 percent decrease in litigation.

Teddy winner Main Line Health (MLH) adopted worker advocacy in a way that goes far beyond claims.

Employees who identify and report safety hazards can take credit for their actions by sending out a formal “Employee Safety Message” to nearly 11,000 mailboxes across the organization.

“The recognition is pretty cool,” said Steve Besack, system director, claims management and workers’ compensation for the health system.

MLH also takes a non-adversarial approach to workers with repeat injuries, seeing them as a resource for identifying areas of improvement.

“When you look at ‘repeat offenders’ in an unconventional way, they’re a great asset to the program, not a liability,” said Mike Miller, manager, workers’ compensation and employee safety for MLH.

Teddy winner Monmouth County, N.J. utilizes high-tech motion capture technology to reduce the chance of placing new hires in jobs that are likely to hurt them.

Monmouth County also adopted numerous wellness initiatives that help workers manage their weight and improve their wellbeing overall.

“You should see the looks on their faces when their cholesterol is down, they’ve lost weight and their blood sugar is better. We’ve had people lose 30 and 40 pounds,” said William McGuane, the county’s manager of benefits and workers’ compensation.

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Do these sound like minor program elements? The math says otherwise: Claims severity has plunged from $5.5 million in 2009 to $1.3 million in 2017.

At the University of Pennsylvania, putting workers first means getting out from behind the desk and finding out what each one of them is tasked with, day in, day out — and looking for ways to make each of those tasks safer.

Regular observations across the sprawling campus have resulted in a phenomenal number of process and equipment changes that seem simple on their own, but in combination have created a substantially safer, healthier campus and improved employee morale.

UPenn’s workers’ comp costs, in the seven-digit figures in 2009, have been virtually cut in half.

Risk & Insurance® is proud to honor the work of these four organizations. We hope their stories inspire other organizations to be true partners with the employees they depend on. &

Michelle Kerr is associate editor of Risk & Insurance. She can be reached at [email protected]