Tag Archives: risk management

Scholarship Season

scholarship_money

Spring break is upon us!  Over the next few days, Ferris State students will scatter to various warm climates for spring break next week.  When the RMI students return in mid-March, they will be facing several imminent scholarship deadlines.  The amount of scholarship assistance that is available to today’s RMI student is impressive, uplifting, and dare I say, overwhelming.  The ever-growing list of RMI scholarships certainly reflects the industry’s urgent need for young talent, and that should speak volumes to those students and parents still contemplating an academic and career direction.

Many of these scholarships have springtime application deadlines so that awards may be made during May for the upcoming 2017-18 academic year.  This time of year, I receive multiple scholarship opportunities each week that I pass along to my RMI students.  As I have blogged in the past, there are also several online resources (including our own partial list) that will help students to find RMI scholarships.  There is absolutely no reason that a diligent student cannot find at least some scholarship assistance for their RMI education.

All of this is good.  Or is it?  Let me return to my prior use of the word “overwhelming” as it relates to these scholarships.  There are so many scholarship opportunities from every type of RMI organization imaginable, that students seem to be “freezing up” when it comes to applying for these scholarships.  With so many opportunities, it becomes difficult for the individual student to discern which opportunities afford them the best chance of receiving an award, and with limited time to crank out scholarship applications, they can apply for only so many.  In fact, this is beginning to be noticed by the awarding organizations as I have begun to receive queries from some scholarship sponsors as to why their application numbers are lower than expected.  To be clear, I don’t think that’s a universal condition as many of the established and well-known scholarships continue to receive plenty of applicants and award their scholarships only to the most deserving students.  It seems to be the newer, lesser-known scholarships that are struggling to find applicants.

This is a real shame because these sponsoring organizations have funds to help students, and they really do want to bolster the young talent coming into the industry.  I hesitate to say that there may be an over-supply of RMI scholarships because that almost feels blasphemous.  How could there ever be an over-supply of such a fantastic thing as scholarship money when tuition and book costs continue to rise?

I have an idea.  What if some of these scholarship sponsoring organizations who are struggling to generate applicants diverted those scholarships funds for a few years?  Instead of begging for student applicants, put the funds into the hands of the collegiate RMI programs to use for program marketing and enrollment growth initiatives.  More RMI students enrolled at schools equals more future scholarship applicants.  Now, you might argue that the scholarships themselves should be a powerful recruiting tool for boosting RMI enrollment.  Absolutely true, but there is much more to the student decision to major in RMI and I believe that the individual RMI schools are in the best position to convey the overall value proposition (including abundant scholarship opportunities) to prospective students – but not many schools have budgeted funds specifically for marketing their RMI academic programs.

This could be an interesting short-term tactical shift for some scholarship sponsors that pays off with a long-term strategic success of awarding more scholarships to the most deserving students (however each awarding organization may define that) a few years down the road.

Flexible Career

career_in_insurance

Practical Education, Flexible Career, Rewarding Life.

Last week, I posted about the practical education element of the Ferris State RMI program’s tagline.  In the continuing spirit of Insurance Careers Month, I will discuss the flexible career aspect this week.  I’d like to begin by highlighting one example of insurance career flexibility: me.

I was one of the many “accidental” insurance professionals who stumbled into a commercial underwriting position fresh out of college.  A few years later, I moved into a risk management role with a large retailer.  Applying my interests and aptitudes for technology, I eventually started my own consulting practice where I worked on several Fortune 500 risk management information system projects.  An opportunity came along to develop a system and process for tracking certificates of insurance, and an entirely new business was born.  Over the course of ten years, I was able to grow and then sell that business, and then pursue the bucket list objective of earning a doctoral degree.  Shortly thereafter, Ferris State revived its RMI academic program and began searching for a lead faculty and program coordinator, and here I am today.

Over the years, I’ve talked to countless risk and insurance professionals, some who intentionally entered the industry and many who discovered it accidentally.  I am always intrigued by the unique stories of these career arcs.  They are always a fascinating story of career evolution that starts in one area of the industry and then twists and turns through a variety of different roles, opportunities, firms, and locations.  Many in the industry have had the chance to live in some wonderful places, including overseas.  Here in Michigan, insurance professionals can work in the metropolitan areas of Detroit and Grand Rapids, or near the exquisite shorelines of Grand Haven and Traverse City, or in the pristine wilderness (and sportsman’s paradise) of the Upper Peninsula.  The key takeaway from my and many other stories is that a risk and insurance career is not stagnant, but rather it allows for evolution through a number of interesting, challenging, and meaningful positions in a variety of locations.

A flexible career has another meaning besides career path mobility and opportunity.  Numerous articles describing the desire for workplace flexibility have appeared in recent years, particularly when discussing the Millennial generation.  However, I believe that this desire for flexibility is not unique to the Millennials.  In this age of instant, always-on communication, I think we all value the ability to work from anywhere we wish, and at the times that we wish.  Technology certainly supports our ability to be productive from our home office or even from the bleacher seats as we watch our children and grandchildren play sports.  The risk and insurance industry offers this type of flexibility.  Many professionals are now based out of home offices.  Field personnel who do loss control or claims work often schedule their own appointments.  I’ve spoken with many insurance agents over the years who treasure the ability to work in the office during the morning, have a client meeting over lunch, spend time on a family activity during the afternoon, and finish up their day with a little work in their home office.  The next day’s schedule may look entirely different – it’s up to them.

Let me be clear.  There is work to be done.  I don’t intend to paint a picture of insurance professionals spending all of their afternoons on the golf course,  During my consulting days, I traveled 50-75% of the time and I was away from my young family more than I cared to be at times.  Nevertheless, the work was always interesting, never boring, and I always had a degree of control over when I scheduled projects.  On the whole, I have enjoyed a tremendous amount of flexibility and variety in my risk and insurance career, and you can too.

 

Practical Education

theory_into_practice

February is “Insurance Careers Month” during which risk and insurance professionals make a concerted effort to highlight the industry’s career opportunities for young people facing a myriad of academic and professional choices.  A few years ago, when Ferris State University revived its storied risk management and insurance academic program, we re-engineered the curriculum and co-curricular opportunities for the 21st century.  As the new program took shape, I sat down with an advisory board sub-committee to craft a tagline for the program that would capture its essence and the potential that it offered students:

Ferris State University Risk Management and Insurance:  Practical Education.  Flexible Career.  Rewarding Life.

 In the context of insurance careers month, I decided to break this tagline down and discuss each of its component parts over the next few weeks.

“Practical Education” is not just lip service – it’s part of the Ferris State DNA.  The school was founded in 1884 by Woodbridge and Helen Ferris as Big Rapids Industrial School.  A review of the school’s history clearly demonstrates a focus on teaching practical skills that prepare students for gainful employment and successful careers in fields where workers are needed.  To this day, Ferris offers programs in such fields as Heavy Equipment Technology, Welding Engineering Technology, Plastics Engineering Technology, Pharmacy, Optometry, and yes, Risk Management and Insurance.  All of these are fields clamoring for young, educated talent.  The Ferris State mission and core values clearly emphasize the practical nature of a Ferris State education.

The new Ferris State RMI academic program has been designed from the ground-up to provide this practical education.  Our students learn the foundational concepts of the risk management process, insurance coverages, insurance law, and terminology.  But that’s not all.  The reality is that in many fields, a significant portion of the technical knowledge a person gains in school will be obsolete within ten years of graduation.  The truth is that the technical learning continues well beyond college graduation, and in fact, never really ends.  Insurance coverages will evolve with emerging risks such as cyber-risk, and who knows what comes next in the 2030s, 2040s, and beyond.

At the heart of our practical education is an emphasis on experiential learning, adaptable degree programs, and development of timeless skills.  Practical education means that our students will complete internships where they go to work in the “real world” of risk and insurance.  It means they attend industry conferences where they are exposed to emerging industry issues and begin building a professional network.  It means that they participate in co-curricular activities such as Gamma Iota Sigma.

Practical education means that students complete the foundational RMI courses and then have the opportunity to draw a variety of other courses from across the University to complete their degree and to suit their interests and career direction.  Interested in becoming a cyber-security/cyber-risk expert? Take a few of our information security courses.  Interested in predictive analytics for risk and insurance? Take data analytics and data mining courses.  Interested in the agency side of the business? Take our agency operations course along with a few small business management courses.  Examples of practical tailored education abound.

Practical education means that students learn and practice the skills that every employer seeks.  The RMIN 489 capstone course includes units, exercises, and activities in such areas as critical thinking skills, logic, problem-solving, and collaboration, to name a few.  Just next week, the RMIN 489 students will be addressed by an industry veteran who will be coaching them through several case studies drawn from genuine situations from the realms of underwriting, claims, sales, and risk management.  The cases we use in this course are not canned textbook cases – they are real-world (with names changed to protect the guilty/innocent) situations for which there is rarely “one correct solution.”  The intent is to exercise the students’ problem-solving and analytical skills as they evaluate each case against the foundational risk and insurance knowledge they have gained.

This is real-world stuff.  This is a practical education.

Back to School

college_bound

Next week marks the beginning of a new academic year at Ferris State University, and it is going to be a busy one.  The FSU Risk Management and Insurance program officially launches a re-engineered curriculum this fall.  One of the most important features of the updated curriculum is a 15-credit block wherein students will tailor their education (with academic and professional advice) to suit their interests and aptitudes.  Some students may decide to enhance their RMI degree with an area of emphasis in data analytics by completing coursework in data mining, statistics, and predictive analytics.  Other students may focus on risk management by adding coursework in advanced risk management, enterprise risk management, and risk management technologies.  These are but two examples of potential specializations which might also include other areas such as cyber-risk, entrepreneurship, agency operations, and more.  Fun stuff!

Earlier this year, the Ferris State RMI program launched a strategic planning process.  The bulk of the committee’s planning work is now complete.  Execution of the strategic plan is already underway, and will be an ongoing process over the next few years.  This will result in considerable activity both inside and outside of the academic classroom, adding to our students’ success and strengthening the program for future students.

On a personal note, I am beginning my fourth year in academia this fall.  After spending the first 25 years of my career working in and around the risk and insurance industry in a variety of roles, I can honestly say that the past three years have been the most intrinsically rewarding years of my career.  But what really excites me is what I see ahead.  Ferris State has established a fantastic foundation for the RMI program, the risk and insurance industry is eager to hire ambitious graduates, and now we just need to fill more of the seats.  It is going to be a busy and exhilarating year.  Let’s get started.

Present, but absent

officespace_presenteeism

Presenteeism, according to one recent research report, is ten times more costly to business than absenteeism.  Presenteeism is what happens when employees show up for work but put forth significantly less than a full effort.  This is not a new phenomenon.  I’ve witnessed it anecdotally in various work settings throughout my career. The cult-classic film “Office Space” provides an entertaining depiction of presenteeism.

In fact, to be totally honest, there have been days in my working life when I’ve been “present, but absent” on the job.  Not recently, but there have been those days.  As the Office Space character Peter Gibbons says, “It’s not that I’m lazy, it’s that I just don’t care.”  There were times in my professional past when the work wasn’t challenging, the bureaucracy and politics were oppressive, and the mission was unclear.  All of those conditions result from poor leadership in the enterprise.  When the work environment is such that the effort seems futile, presenteeism is the result.  The truly alarming fact is that no employee is immune, and presenteeism can become an insidious cancer within an organization.

There is more to the costs associated with presenteeism than just lost productivity.  Customer and supplier relationships can be damaged, co-workers can be “infected,” and employees can suffer long-term physical and mental harm.  It has long been known that distracted employees are more likely to be injured on the job, and long-term presenteeism can result in atrophy of a worker’s skills and abilities.  Presenteeism is more than just a productivity issue – it is also an employee wellness issue (for the benefits staff to consider) and a workers compensation issue (for the risk management staff to consider).

The natural inclination among managers with an industrial-era scientific management mindset (archaic in this knowledge-economy era, but still very much alive) is to “buckle down” to make sure that employees are working to their full potential at all times.  That’s a knee-jerk reaction that leads to micromanagement and paternalism.  Approaching presenteeism from that angle is anathema to employee engagement and knowledge worker productivity.  My own doctoral research examined this area quite closely.

The true answer to presenteeism is not to treat the symptoms but to cure the underlying disease.  Remove the conditions that cause employees to “check-out” and do just enough work to avoid getting fired.  That means providing challenging work, adequate authority, opportunities for personal development and mastery, and then get out of their way.  A great book that gets at the heart of motivation for modern-day knowledge workers is “Drive” by Daniel Pink, or check out his TED talk on the same material.

Employers, specifically leaders and managers, must come to grips with the magnitude of the presenteeism problem.  Perhaps more importantly, they need to recognize the difference between effective and counterproductive responses to the presenteeism problem.   Our economic health as well as the physical and mental health of our employees depends on it.

Space Shuttle Challenger

challenger

Thirty years ago today, the space shuttle Challenger exploded just 73 seconds into its flight, taking the lives of all seven astronauts, including school teacher Christa McAuliffe.  As with most tragic events that affect an entire nation, I remember where I was when I learned of the disaster.  I was just returning home from a morning class during my undergraduate days at Michigan State University.  My roommate and I watched the network news bulletins in utter disbelief.

The investigation following the disaster concluded that the cause of the explosion was a failure in an O-ring component of the solid fuel rocket boosters which allowed hot gas to escape and ignite the shuttle’s external fuel tank.  The O-rings had a design flaw which had long before been deemed to be acceptable and several previous successful shuttle launches seemed to support that conclusion.  However, the O-ring design flaw presented greater risk at colder temperatures.  On the morning of January 28, 1986, the Florida temperature was a mere 36 degrees Fahrenheit.  In the days following the disaster, we learned that there were engineers who had cautioned that the O-rings may not properly seal at temperatures below 53 degrees Fahrenheit, but such cautions were either ignored or were not effectively communicated.

Much has been written regarding this disaster and its obvious risk management failings over the last 30 years.  There have been alternative theories, talk of conspiracies and cover-ups, and frankly some pretty wacky stuff.  I can’t help but wonder if this disaster might have been averted had their been more of an enterprise-wide risk management process in place.  Don’t get me wrong… NASA and all of the contractors involved in the space program for the last 50+ years have always taken the significant risks of space travel very seriously, and have had many processes and checklists in place to ensure that no step was missed and no procedure left undocumented.  The ingenuity and dedication to astronaut safety was on full display in the case of Apollo 13.  That NASA mission also endured a catastrophic explosion, but with a much happier ending.

The fact is, bad things will happen.  The entire profession of risk management and the insurance industry that serves us exist only because there is risk in everything that we do.  We need to be prepared to identify and control these risks, and finance the economic impact of the risks that slip past us.  Enterprise risk management is a relatively recent approach and evolution from the traditional risk management approach where risk and risk control existed within organizational silos.  ERM addresses risk more holistically and bridges across those organizational silos.  I am no expert on the Challenger disaster and the investigation, but it seems to me that there is a fair amount of evidence that the launch decision on that cold Florida morning 30 years ago was made without the benefit of sufficient risk information from across the NASA enterprise.  And if that is true, what a shame that enterprise risk management couldn’t have evolved a few decades earlier.

Thanksgiving Risk Management

turkey_fryer_fire

I thoroughly enjoy the long Thanksgiving holiday weekend.  I prefer to avoid the hustle and bustle of the shopping crowds, and spend the weekend on three activities instead:  Family, feasting, and football.  Just before this holiday weekend began, I noticed a few articles on the dangers of turkey fryers, and it caused me to consider a few of the personal risks associated with this holiday.

Perhaps the most acute personal loss exposure is that of property damage from grease fires, mostly from the growing popularity of turkey fryers.  Business Insurance reported annual damages averaging $15 million from grease fires this time of year.  That’s quite a few charred birds and charred garages.  I must admit, fried turkeys are quite tasty, but they are definitely risky.  I am happy to report that my family’s fried turkey was delicious and cooked without incident this year.  We purchased an electric fryer last year, which seems to be significantly safer than the open flame propane fryers, but hot oil is always dangerous.  Even if you avoid burning your garage down, splashing and splattering 375-degree oil will cause serious burns.

If you survive the turkey fryer, there are additional risks associated with food poisoning.  Food safety practices are sometimes overlooked in the rush to get the feast on the dining room table.  No one wants to spend their holiday weekend in the bathroom or the hospital due to undercooked birds or leftovers not properly refrigerated.

And then there’s Black Friday shopping chaos…  Auto accidents increase as people rush to the shopping malls or drive long distances to grandma’s house.   In a sad commentary on the state of civility this holiday weekend, there are incidents of brawls and stampedes erupting over shopping deals that may not even be great deals to begin with.

It’s a wonder we survive the holiday…  Be careful out there by practicing good personal risk management.  When it comes to Black Friday, I’m all about risk avoidance:  I stay home and watch football from my sofa.