Column: Risk Management

A Recipe for Rebellion Risk

By: | August 1, 2013 • 3 min read

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

When control is thought to have been taken away from the populace and decisions made autocratically, the risk of rebellion increases. Sudden changes in the political sphere can disrupt our families and our dreams. Are we prepared for this? Should risk managers worry about the impact of a severe political unrest, be it business interruption from public protest, property damage, or worse?


Even the best risk mitigation strategies would be challenged when a passionate response to governmental action is a looming possibility.

Let’s consider Detroit, for example. Under tremendous financial strain, the city decided to stop making debt repayments this summer. It is offering to compensate lenders at 10 cents on the dollar. Imagine experiencing a 90-percent financial haircut.

The city also advised government pensioners to prepare for income and benefit reductions. The city can’t meet the obligations that previous administrations made. Those elected officials made unwise deals with public sector unions and then kicked the can as far down the road as possible.

Detroit is the new southern European nation and many other United States cities could be following in its footsteps.

The current Detroit city leadership making these decisions was appointed by the state governor, with a mandate to do anything that is necessary to get things back into financial order.

No matter that they were given an impossible situation to manage, these appointees were not elected.  The electorate did not choose this strategy. It was not a community decision to reduce pension payments or to default on debt, even though the buck had to stop somewhere with someone.

The average taxpayer or pensioner won’t be able to recall the myriad poor decisions, including the deals with public sector unions, that led to this harsh day. All they will know is that their pension check is getting cut, or their museum is being sold off.

With so many local and state governments in debt, it appears that substantial changes like those being faced in Detroit are going to be more widespread.

The public pain is going to be severe and there is going to be some degree of social unrest as a result.

Ten years ago, most U.S. risk managers would find it difficult to imagine needing a mitigation plan that considers domestic social unrest.

It all sounds unreal; I agree. But yet the reality of it can’t be ignored.

I look at the images of Turkey and Brazil, and realize we might be only a small spark away from such major unrest at home.


Will the people of Detroit continue to trust the establishment? Or will the economic situation in Detroit reignite simmering social unrest like that last seen during the Occupy Wall Street civil rebellion of two summers ago?

That was a relatively peaceful protest, but it spread throughout North America and around the world. The Occupy Wall Street protests and others like them highlighted some of the slow-boiling unhappiness that many are living with. Imagine how quickly that unrest could be reignited.

How should the private sector mitigate the risk of chaos and rebellion that is stemming from public sector mismanagement?

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.


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.


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]