Time management and knowledge key to success for risk managers

The rapid pace of the modern economy means that risk managers need to be knowledgeable, flexible and agile to stay ahead of the game. Risk managers can no longer sit at their desks and rely on tried and tested systems and processes to help their organisations cope with whatever the market throws at them. Tight cost control is critical in such an environment. The Sirm members who took part in this year’s European Risk Frontiers survey agreed that this means today’s risk managers need to be extremely focused on the effective use of available resources to deliver what their organisations need. “For me multi-tasking and keeping track of how projects develop over time is critical,” commented Volker Trapp, risk manager for international logistics firm DHL. “The challenge is to complete a project, move on to the next one and not forget all about it. Then six months later the first project comes up again and you have to start all over again. Good time and project management for risk managers is essential in the modern economy,” he added. Sabrina Hartusch, risk manager for international lingerie firm Triumph and current president of Swiss risk management association Sirm, agreed with Mr Trapp. She added that reading and constant learning is also very important for risk managers. “I think it is still important to read a lot. We are always learning. It is not necessarily direct in the sense that you pick up a lot of useful information and ideas from general newspapers that you can relate to your job and world. As risk managers, we have to be so broad-thinking. We need a wide range of skills and knowledge that we can apply in many different ways,” she pointed out. Stefan Haemmerli, risk manager for the Canton of Zurich, agreed that knowledge and learning is key, but pointed out that time is limited for everyone and so has to be used wisely. “Time is everything. We do not seem to have enough time to do that all-important reading and thinking. I would like to know more about the law. I am a lawyer by training but I would like to know more about liability, insurance law and public law. We have 65 different offices and agencies and I would like to know more about how they operate. My background is in claims and I would like to know more about how insurers actually go about underwriting and finance,” he said. The Swiss risk managers agreed that it would be very useful for new risk managers to learn as much as possible about the underwriting process and take advantage of the recent rise in risk management specific education, not least Ferma’s rimap initiative. Mr Trapp said: “It would be very useful for young risk managers to know more about underwriting. We at Sirm have individual practice groups for certain topics including retail, logistics, captives and the like, but we have no underwriting group yet. It would depend on the level of interest. Currently we have two new interest groups planned for luxury goods and transportation. It is also worth pointing out that Swiss risk managers can take the Associate in Risk Management course (ARM) and of course Ferma’s new rimap certification.” Nancy Wellinger, insurance manager for SBB Railways, herself a former underwriter with Zurich, agreed it is very useful for risk managers to understand the underwriting process. But she stressed that it is not easy. “An understanding of the underwriting process is critical for a young risk manager, but it is not easy and cannot really be learned from a book. I come from a hard-core underwriting background. I was an underwriter for 20 years with Zurich and a broker in Germany. Unless you have done this job yourself I do not think you will ever really learn the feeling in your stomach that you need to underwrite a risk and really understand the process,” she said. Ms Wellinger added that it is essential for a risk manager to truly understand their business, which means getting out and talking to people across the group as much as possible. “One key thing that all young risk managers need is to understand their business. This is not always easy and is not in my case. Apart from the core railway business we built the Gottard tunnel, which was a huge project and we have a real estate business. There are so many different risks. There are also different cultures. Some people are office-based while others are on site. You have to go out and talk to people. If something happens then you need to go out and take a look and talk to the people involved. You need to be well networked in the business and talk to people at different levels in different ways to extract the information you need,” she explained. Knowledge of the law, and contract liability in particular, is a very useful skill in the modern economy, pointed out Mr Trapp. “Contract risks are very important too. We need to see all the contracts that are not standard. If the contract deviates from the norm then we need to see it. We have certain customers that can lead to big financial losses and high indemnities. These are risks that we do not want to bear. If we cannot agree on the correct balance of risk and liabilities then we do not enter the relationship. If the customer is effectively shifting liability onto us then it has to be properly assessed and priced, because they will be saving on their own cost of risk and insurance. Then you identify the real cost of the contract and maybe find that it is not worth doing,” he explained. “This referral approval process goes through legal, real estate, procurement and risk management. The sales people inevitably might argue that we are stopping them doing business, but if it is bad business then it should not be done. One option within this process is to sell the insurance yourself to the customer to help get the deal agreed. This is a good solution in which all parties are clear and agree,” continued Mr Trapp.

Time management and knowledge key to success for risk managers

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