The Consultants Are Here to See You...

Don't resist. You can't. But you can frame their work in ways that will help you shape the outcome of their analysis.

If you are running an insurance claims operation, and your boss or the board brings in outside consulting experts to evaluate it, chances are you have a problem. Not just the problem the consultants are being called in to examine but a pricklier, more personal problem--a perception problem. Someone with some clout in your organization apparently doesn't believe you are capable of doing whatever it is the consultants are going to be doing. That puts you in a tricky situation, one that demands thoughtful action. First off, don't try to convince your boss or the board that you are an expert and that you don't need outside assistance. Don't waste time arguing that your training and years of experience managing claims qualify you for the challenge. Do understand that the decision has already gone the other way, and any attempt you make to reverse it looks like resistance, concealment, perhaps even cluelessness. Think about it. If you argue that there is no problem, or the problem is outside of claims, or that every claims operation has the same problem, you risk being classified as stubborn and averse to change. Don't protest that you have already diagnosed the problem and designed a solution; others don't see things that way. They want another opinion, another perspective. Maybe they don't like your plan, or perhaps it conflicts with some other course of action they want to pursue. It could be they don't quite know what the problem is, but there's something troublesome in the loss numbers, and they want to understand why it is happening and what to do about it. Or, worst case for you, they might just be looking for evidence and justification for overhauling your organization and escorting you out the door. The reason really doesn't matter, but your response does. As activist and author Jerry Rubin once said: "The power to define the situation is the ultimate power." You have the power to assist in framing the inquiry and shaping the outcome by being visible and playing an active, cooperative role with the experts during the engagement. Take advantage of that power. First, welcome the consultants and make arrangements to provide them with whatever help and information they need. Brief them fully on your organization, your strategy and your operating procedures. Impress them with the dashboards and controls you use to manage risks and results. Talk to them about process efficiency, effectiveness and loss-cost management techniques. Show them how you establish and monitor key performance indicators and how you interact and communicate with your stakeholders. Demonstrate how you identify and incorporate best practices in your claims handling processes. If some of the consultants lack industry knowledge and have no background in claims--don't be dismayed. Instead, patiently take the time to make sure they fully grasp how your company functions and how your operation contributes to results. In other words, do whatever you can to provide the experts with plenty of evidence supporting the proposition that when it comes to running an insurance claims operation: 1) you know what to do, 2) you know how to do it and 3) you are doing it, quite well. The consultants' job is to identify performance gaps and root causes and propose actions to close those gaps. Your objective should be to provide them with the information, the insights and the support they need to do that job well. People who hire consultants usually believe the consultants will bring very high levels of knowledge, objectivity, credibility and perceptiveness to the engagement. While that belief might not always be accurate, the reality is that consultants' findings are accepted as authoritative in most cases. That means their recommendations will affect you and your organization, so it makes sense for you to invest your time and effort into framing the inquiry and shaping the outcome. Give it your best shot--you might even learn something in the process. The downside is that in tricky, prickly situations like this there is no guarantee things will turn out well even if you do everything right. Sometimes there are hidden operating agendas, foregone conclusions and predetermined outcomes underlying the consulting engagement, and unless you know about those factors going in, there's not much you can do to manage their impact.

Dean Harring

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Dean Harring

Dean K. Harring retired in February 2013 as the executive vice president and chief claims officer at QBE North America in New York. He has more than 40 years experience as a claims senior executive with companies such as Liberty Mutual, Commercial Union, Providence Washington, Zurich North America, GAB Robins and CNA.


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