Risk Insider: Jack Hampton

Disruption Awaits Higher Education

By: | May 25, 2017 • 3 min read
John (Jack) Hampton is a Professor of Business at St. Peter’s University, a core faculty member at the International School of Management (Paris), and a Risk Insider at Risk and Insurance magazine where he was named a 2018 All Star. He was Executive Director of the Risk and Insurance Management Society (RIMS), dean of the schools of business at Seton Hall and Connecticut State universities, and provost of the College of Insurance and SUNY Maritime College in New York City.

It’s 11 p.m. in Manhattan and the theaters near Times Square are letting out. Many residents of the city don’t own cars or at least won’t pay $30 a day to park them nearby.

Thank goodness taxis are available to transport everyone. Or are they?

Not a problem. Click on your smart phone to request a convenient, inexpensive and safe service to take you home. Immediately coming to mind is the ubiquitous Uber, but it’s not your only choice. Lyft gives it a run for its money. Even taxicab companies finally adopted the model.

Higher education may be the taxicab companies of 10 years ago. The business of college and universities is being disrupted, but the threat has been masked by all the attention given to abuses by for-profit colleges. Their misbehavior is widely known, and it has poisoned the well.

We were slow to respond when Joshua Woods, a doctoral student at Michigan State University, dramatically exposed it in 2006. He fictitiously applied to six MBA programs as part of a research project. He used bad grammar and spelling while explaining he was a 31-year-old high school graduate with a grade-point average of 2.0.

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Michigan State promptly answered. “An applicant must have a bachelor’s degree to apply for an MBA program. More information is available on our website.” Not the answer from for-profits.

Within 30 days, he was being recruited by ITT Technical Institute, the University of Phoenix, Davenport University, the American Graduate School of Management, and Corinthian College. Thirty separate emails containing four sales themes:

  • Opportunity. “The starting salary for individuals holding the MBA degree is $55,000.”
  • Ease. “We give you all the help you need to get an MBA, including federal loan financing.”
  • Encouragement. “You can do it. You can improve your life.”
  • Shame. “Are you happy with your life? Embarrassed to tell others where you work?”

In recent years, many students responded to such admonishments. To pay tuition, they were often loaded up with government and other loans. The financial ramifications of more than one trillion dollars of student debt casts a shadow over higher education today.

Higher education may be the taxicab companies of 10 years ago. The business of college and universities is being disrupted, but the threat has been masked by all the attention given to abuses by for-profit colleges. Their misbehavior is widely known and it poisoned the well.

The government is now dealing with the recruiting and financial abuses. At least we hope this is true. Are colleges doing the same?

Thus, we get to Purdue University. Is it about to engage in disruptive innovation?

In April 2017, the school acquired the for-profit Kaplan University with its 32,000 online and campus-based students on 14 campuses in seven states. The Washington Post reported the purchase was an effort to “extend Purdue’s reach into online and adult education.”

The effort by Purdue raises an interesting possibility. Colleges that disrupt the traditional model – use technology, create attractive new programs, respond to economic and other forces – may be the survivors in a world where higher education must overcome financial and other difficulties attacking the traditional education model.

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]