Tag Archives: corporate culture

New Risks Coming From Innovation

The triggers that have induced the insurance industry to innovate have dramatically changed in this millennium. Up until the 21st century, little innovation occurred, because insurers were looking to create products for emerging risks or underinsured risks. Innovation occurred most often as a reaction to claims made by policyholders and their lawyers for losses that underwriters never intended to cover. For example, the early cyber policies, which insured against system failure/downtime or loss of data within automated systems, were created when claims were being made against business owners policies (BOPs) and property policies that had never contemplated these perils. Similarly, some exclusions and endorsements were appended to existing policies to delete or add coverage as a result of claims experience. Occasionally, customer demand led to something new. Rarely was innovation sought as a competency.

Fast forward to today, when insurers are aggressively trying to develop innovative products to increase revenue and market share and to stay relevant to customers of all types. Some examples include: supply chain, expanded cyber, transaction and even reputation coverages.

With sluggish economies, new entrants creating heightened competition, emerging socio-economic trends and technological advances, insurers must innovate more rapidly and profoundly than ever. The good news is that there is movement toward that end. Here is a sampling of the likely spheres in which creativity will show itself.


Insurers have already started to respond to the drone phenomenon with endorsements and policies to cover the property and liability issues that arise with their use. But this is only the tip of iceberg in comparison with the response that will be needed as space travel becomes more commonplace. Elon Musk, entrepreneur and founder of SpaceX, has announced his idea for colonization of Mars via his interplanetary transport system (ITS). “If all goes according to plan, the reusable ITS will help humanity establish a permanent, self-sustaining colony on the Red Planet within the next 50 to 100 years” according to an article this September by Mike Wall at Space.com.

See also: Innovation — or Just Innovative Thinking?  

Consider the new types of coverages that may be needed to make interplanetary space travel viable. All sorts of novel property perils and liability issues will need to be addressed.


Weather-related covers already exist, but with the likelihood of more extreme climate change there will be demand for many more weather-related products. Customers may need to protect against unprecedented levels of heat, drought, rain/flood and cold that affect the basic course of doing business.

The insurance industry has just taken new steps in involving itself in the flood arena, where until now it has only done so in terms of commercial accounts. Several reinsurers — Swiss Re, Transatlantic Re and Munich Re — have provided reinsurance for the National Flood Insurance Program (NFIP), for example. Insurance trade associations are studying and discussing why primary insurers should do more in terms flood insurance as a result of seeing that such small percentages of homeowners have taken advantage of NFIP’s insurance protection.

Sharing Economy

As a single definition for the sharing economy begins to take shape, suffice it to say that it exists when individual people offer each other products and services without the use of a middleman, save the internet. Whether the product being offered is a used handbag, a piece of art or a room in a private house or whether the service is website design, resume writing or a ride to and from someplace, there are a host of risk issues for both the buyer and seller that are not typically contemplated by the individual and not covered in most personal insurance policies. This is fertile ground for inventive insurers. How can they invent a coverage that is part personal and part commercial? Smart ones will figure out how to package certain protections based on the likely losses that individuals in the sharing economy are facing.

Driverless Cars

So much has already been written about the future of driverless cars, but so many of the answers are still outstanding. How will insurance function during the transition; who will be liable when a driverless car has an accident; who will the customer be; what should the industry be doing to set standards and regulations about these cars and driving of them; how will subrogation be handled; how expensive will repairs be; how will rates be set? A full list of unanswered questions would be pages long. The point for this article is – how innovative will insurers be in finding answers that not only respond to these basic questions but also provide value-added service that customers will be willing to pay for?

See also: Insurance Innovation: No Longer Oxymoron  

The value added is where real innovation comes into play. Something along the lines of Metromile’s offerings for today’s cars is needed, such as helping drivers to find parking or locate their parked cars. Such added value is what might stem the tide of the dramatic premium outflows that are being predicted for insurers once driverless cars are fully phased in.

Corporate Culture and Reputation

Recent events indicate that corporations need some risk transfer when it comes to the effects of major corporate scandals that become public knowledge. The impact from the size and scope of situations such as the Wells Fargo, Chrysler, Volkswagen and other such scandals is huge. Some of the cost involves internal process changes, public relations activities, lost management time, loss of revenue, fines and settlements. Reputation insurance is in its infancy and warrants further development. And though insurance typically does not cover loss from deliberate acts, especially those that are illegal, there is enough gray area in many scandals that some type of insurance product may be practical despite the moral hazard and without condoning illegal behavior.

And the Risk

All innovation poses risk. Risk is uncertainty, and innovation leads to uncertain outcomes. Just as insurers must create solutions, they must be willing to acknowledge risk, assess risk, mitigate risk and prepare for some level of risk to materialize. So, as insurers are now actively trying to innovate, they must make sure that their enterprise risk management practices are up to addressing the risks they are taking.

For each new product, some of these risk areas must be explored:

  • Is there a risk that projections for profitability will be wrong?
  • If wrong, by how much, and how will this shortfall affect strategic goals?
  • What is the risk appetite for this product initiative?
  • What is the risk the new product will not attract customers, making all development costs wasted expense?
  • What is the risk that price per exposure will be incorrectly estimated, hurting profitability?
  • What is the risk for catastrophic or shock losses relative to the product?
  • How will aggregation risk be handled?
  • What is the risk that litigation concerning the policy coverages will result in unintended exposures being covered?


Regardless of whether or not they have been dragged into innovation by disruptive forces, insurers are finally ready to do more than tweak products around the edges. The risk of not innovating appears to be greater than the risk associated with innovating.

Why Millennials Are the Best Workers

It has become fashionable to trash Millennials. They lack a strong work ethic, have no grit, aren’t respectful or patient and definitely don’t understand corporate culture. The trashing fits with how people romanticize the 1950s as the golden age of American culture, when everything was just somehow better.

I don’t know whether Gen X is just irritated that they’re getting older or whether people are forming their opinions solely based on Buzzfeed, but I think the stereotype is wrong - dead wrong. In fact, I will go out on a limb and state that Millennials may actually be the best generation of workers we’ve ever seen.

And I say this having hired hundreds of new college grads – and seasoned professionals – over the past 20 years. Here’s why:

1. They’re too big for their britches.

Today’s young job seekers have grown up with a startup mentality. The value of embracing failure has been etched into their psyche by entrepreneurs and tech titans like Steve Jobs and Elon Musk. So, unlike past generations, they are not necessarily looking for stability. They don’t dream of landing a job at GM or IBM. They approach positions with the understanding that they may have to put in 110% to succeed, even with the near certainty that their employer won’t be around five years from now.

Put that in contrast to the stigma of entitlement attached to Millennials. It’s true that many baby boomer parents have raised them with a perspective of possibility. They’ve been encouraged to follow their dreams and passions. And from watching Mark Zuckerberg or President Obama, they’ve learned first-hand that it’s not just dogma; anything really is possible.

So where some see entitlement, I see greater authenticity and audacity.

Millennials will shoot for the stars – and if they fall down, they’ll get right back up and try a different way.

2. They just don’t communicate the way you do.

If you’ve watched “Mad Men,” you’ve seen the fast-paced advertising world struggle to become more connected with innovations like… the speaker phone. Fast forward to today, where first-time job seekers not only understand and embrace collaborative technologies but don’t know anything different.

While many offices struggle to get their workforce to embrace services like Yammer or Basecamp, Millennials have been doing those things for years. They’ve been learning with social classroom tools and chatting on Facebook, Twitter and Instagram every waking hour. As a result, they actually conceive of communication in a one-to-many paradigm, which is a huge plus for companies that are spread out globally and interact primarily in a virtual environment.

3. They expect things to happen instantly.

I don’t know anyone over the age of 50 who doesn’t complain about how fast the world is moving these days. However, in the case of job performance, that’s a very very good thing. Think about it. Thirty years ago, everything took a lot more time. The data you needed to make critical business decisions was delivered weeks later by a mail truck. Someone had to physically be sitting in a predetermined location at the right time for you to call on the phone.

Our expectations for accomplishing tasks were, naturally, based on the resources and structures we had in place. Simply put, we moved much slower. And, God bless them, there are many professionals out there who still work the same way.

Not Millennial workers. With the pace of news, communication and responsiveness nearly instant, that’s how they approach work. They know nothing else. Plus, they have the necessary tools to support them. Give a Millennial employee a research assignment on your competitors, and you’ll get the project back in 24 hours. Twenty years ago, the same project might have taken a month. One piece of advice: Just make sure you attach a deadline to the assignment.

4. They expect too much.

Studies show that young job seekers today are passionate about how their jobs affect the world. In fact, they value job fulfillment over monetary reward. Many balk at the traditional model of doing charitable good only when you have reached a certain level of economic wealth or solely in your free time. They want to reach financial well-being and achieve social good simultaneously .

What does that mean for employers? I would hope it could open the doors to two things. First, we have the ability to retain skilled and valuable Millennial workers by creating environments where social impact is lauded. That will reduce employee turnover and save companies thousands of dollars each year in recruiting, hiring and lost productivity.

More important, Millennials are a driving force toward significant, scalable and lasting social change that will benefit everyone, whether it’s about the environment, socioeconomic diversity or just a healthier work-life balance. In case you’ve forgotten, the U.S. ranks the worst among all modern economies in vacation time and pay.

5. They think differently from you.

Millennials are the most diverse generation in U.S. history. Minorities, roughly a third of the U.S. population today, are expected to become the majority by 2042. So Millennials don’t just embrace diversity on the job; they expect it.

From race and religion to gender and sexuality, they’ve come of age with a greater comfort of multiplicity of all kinds. They’ve entered adulthood with an African-American president and been the catalyst for many states legalizing same-sex marriage. Female leaders like Hillary Clinton and Sheryl Sandberg have shaped their views on gender equality.

Imagine how that translates in the workplace. The payoffs touch every single area of a business by opening the doors to increased creativity, agility and productivity, new attitudes and language skills, a more global understanding, new solutions to difficult problems, stronger customer and community loyalty and improved employee recruitment and retention.

6. They are obsessed with technology.

Today even the industries that historically have been slow to innovate are finally adopting a web- and mobile-first philosophy. Century-old brick-and-mortar stores are fighting to keep Amazon at bay; healthcare finds itself transformed by the Affordable Care Act. Job seekers with coding and programming skills from Java to Ruby to SQL are desperately needed at all types of companies right now. Big data analytics, video game design, app development, software architecture – the list goes on and on for highly sought Millennial workers with tech expertise. But the issue isn’t just about the hard skills they bring.

If you’ve spent any time with a child lately, you’ve probably noticed that they can master an iPad within minutes. It’s mind-blowing – and a little frightening – to imagine how future generations of consumers will interact with technology.

Millennial workers are the bridge to that future, through social media, mobile, the cloud and other real-time technologies that haven’t even been invented yet. They are graduating with both academic skills and innate behavioral skills that companies will need to engage with customers in much more meaningful (and profitable) ways.

It’s the way Millennials think about technology, and their relationship with it, that is changing everything. So, having Millennial employees on staff to advise on your customer relations strategy or spearhead innovative new mobile and social media programs is invaluable for any business of any size, place or industry.

Fire Up Your Firm Through Storytelling

“Symbols, dramas, stories, vision and love–these are the stuff of effective leadership, much more so than formal processes or structures. When you involve people, they feel ownership and perform up to 1,000% better.”

Tom Peters, A Passion for Excellence

The speed of change in today’s world is so disorienting that people are struggling to maintain their equilibrium and sense of wellbeing. In times of chaos, and especially when basic needs are threatened, strong leadership is more important than ever. Because people are looking to the workplace now for all their needs — professional development, social activities, onsite health care and child care services — strong leadership is especially critical. Business leaders need to reassure employees that they will continue to receive the support they need, even as the organization continually adapts to the chaotic marketplace so that customers’ rapidly changing expectations can be met.

Communication is the key to accomplishing this goal, and the most effective approach is to develop an authentic story — and tell it effectively. A company needs to develop a story so bright and so right that its target audiences (employees, customers, stockholders, affiliates, suppliers, etc.) are drawn to the flame. This story needs to be told — and retold with new twists — at every opportunity. By reminding everyone affiliated with your organization of where you’re going and how you plan to get there — and most importantly, how each person can contribute — you will strengthen the culture and boost morale.

Stories have been the glue connecting people with their cultures and with one another throughout human history. In ancient cultures, and even relatively modern tribes, the oral tradition was the vehicle for passing tribal practices and history down through the generations. The designated tribal storyteller was responsible for ensuring that each member of the group understood the importance of his role in continuing the traditions upon which the very survival of the tribe depended. The storyteller also served as an entertainer, retelling familiar tales around the campfire and engaging the imaginations of all those in the circle.

Why have stories always been so central to human interactions? Because stories reach people at a deeper level than a litany of facts and figures, and stay with people longer. As the high-tech elements continually become more dominant, people hunger for high-touch interactions.

Stories in Corporate Cultures

Corporate cultures are no different from ethnic cultures or any other special-interest group in their need for, and dependence on, stories about themselves, which help to create a culture as well as keep it alive. While in our modern culture we often think of a story or myth as a fabrication, storytelling is, in fact, the primary tool we all use to communicate. “How’s your day going?” “What’s the status of your project?” “What’s the latest news on the company’s new product?” Each of these commonly posed questions is answered in story form, whether or not the speaker is aware of being a “storyteller.” Awareness, however, is essential to the process of identifying an organization’s core story.

“All you can do is relate the successful experiences you’ve had within the company. What else have we got besides stories? That’s what really hits home with people; it’s what brings meaning to the work we do…. A picture is worth a thousand words, and a story told appropriately is priceless. Telling one of our stories speaks volumes about our philosophy and our values.”

Jim Sinegal, co-founder and CEO, Costco Wholesale

From Around the Corporate Campfire: How Great Leaders Use Stories to Inspire Success, C&C Publishing, 2004

To reach key audiences, an organization’s story must be authentic; it must be based on corporate values and guiding principles. An authentic story reveals the true personality of the company. It reflects, in essence, the heart and soul of the organization. As such, the core story must be told by people in leadership roles in a consistent manner and on a regular basis to ensure that they control it. When a leader articulates the core story effectively and consistently, people at all levels of the organization are captivated by the vision and begin “singing from the same page.” This level of company-wide consistency and commitment enables an organization to cut through the clutter of the marketplace to reach its targeted audiences and draw them into the inner circle.

Team-Building Through Personal Stories

The storytelling approach also has proven to be a highly effective teambuilding system, which is especially fitting for a retreat. Work teams often choose to apply the process in telling their own personal stories before beginning the joint work of developing the organization’s story. In doing so, they experience two key aspects of working together:

  • Self-discovery is exciting.
  • Self-disclosure leads to trust.

Their excitement is contagious! As participants discover shared personal values, they begin building ties with co-workers with whom they formerly believed they had nothing in common.

“If I wanted to predict behavior, I could still predict it better with the stories told around the company than I could with any mission statement or five-year plan.”

Robert Shapiro, former chairman and CEO
Monsanto Corp. and Nutrasweet Group

In one memorable case some years ago, the storytelling process overcame what had seemed insurmountable barriers between an entrenched manager in a small municipal outpost and the new, sophisticated urban manager who had been brought in to replace him. The atmosphere, understandably, was tense as the first day of a two-day planning retreat began. Following a relaxing and playful creative exercise and the sharing of the team’s personal stories, however, the tension eased considerably. The two men warmed up to one another and continued their discussion over lunch. The rest of the retreat was extremely productive, with the outcomes far surpassing the expectations of everyone involved.

This experience demonstrates that the sharing of common values and a common mission helps people to

  • work together,
  • support one another and
  • serve the customer more effectively.

By incorporating storytelling as a part of your business practices and regularly including relevant stories on the agenda for meetings and retreats, you will propel your organization toward its goals. Red-hot stories will keep everyone fired up and eager to pass them along to everyone they encounter.

“Storytelling is the single most powerful tool in a leader’s toolkit.”

Howard Gardner, author and professor, Harvard University Graduate School of Education

Key Takeaways

  1. During times of rapid change and economic uncertainty, such as is present in the insurance industry, strong leadership is more important than ever. Business leaders need to reassure employees that they will have the support they need to navigate the shifting landscape, and the most effective way to do that is to communicate often.
  2. The most effective communication tool is storytelling. By reminding employees of the organization’s values and demonstrating through story how those values are best enacted, leaders can help employees understand how they can succeed, even in trying times.
  3. Stories have always been the glue that helps people stick together, whether they are part of a tribe, a family, a professional association, a circle of friends—or a corporate “tribe.”
  4. A rapidly growing number of leading companies have discovered the power of story as a communication tool. When stories are told consistently and systematically, everyone in the organization works together better, stays focused on the mission and remains productive, ensuring continued success in the midst of change.

Work/Life Balance … Your Tightrope to a Rewarding Career

Do you have proper balance between your personal and business lives?  Or are the demands of your work infringing upon the quantity and quality of time you have with family, friends, hobbies, and community?

The following work/life balance quiz will tell you the degree to which you should be concerned about work/life balance: 

Work/Life Balance Quiz 

  1. Do I work 60 or more hours per week?
  2. Do I have little personal down time?
  3. When I get home from work, am I exhausted?
  4. Does there seem to be precious little time to enhance personal relationships?
  5. Is “fun” no longer a word in my vocabulary?

If you answered “Yes” to 2 or more of the statements above, you owe it to yourself to learn more about work/life balance.

The term work/life balance first appeared in the 1970s.  The expression means having equilibrium among all the priorities in your life.  It is interesting to note that state of balance differs from person to person.  However, if there is little or no balance over an extended period of time, the vast majority of people experience stress and, eventually, burnout. 

Persistent stress results in fatigue, frequent illness, eating disorders, upset stomach, headaches, forgetfulness, sleep deprivation, aggravation, and irritability with colleagues, family, and friends.  Research indicates that the workplace has become the single greatest source of stress.  Let’s look at a handful of scenarios that create stress in the workplace.  Do any of these statements belong to you?

  • I have little impact or control over decision making
  • My expectations of work performance do not meet those of my superiors.
  • There seems to be little opportunity for growth, development, or promotion.
  • My workload is very heavy, requiring long hours and infrequent breaks.
  • My role is not clearly defined.
  • The level of communication within my firm does not meet my level of satisfaction.
  • I am involved in routine tasks that offer little or no professional stimulation.
  • My work environment is unpleasant.

Today’s intense, competitive business climate has created corporate cultures that demand more and more from agency principals, sales managers, producers, account managers, claim consultants, loss control specialists, and customer service representatives.  To get ahead, 60-to-70-hour work weeks appear to be the new standard.  Work overload has been exacerbated by computer technologies that were intended to make our lives easier.  Technology has allowed our clients to view the insurance and risk management profession as a 24/7 business, making the achievement of work/life balance very challenging.

In the early 1920’s, the average work week was 50 hours including a full Saturday work day.  Soon thereafter, pressures were put on businesses to cut Saturday to half a day or have the day off completely.  The ability to have two days of rest was unprecedented.  However, by 1927, half of all employers adopted this new practice. 

This new practice was short lived.  Beginning in the late 1920s, advertisers persuaded Americans that happiness would not come from leisure rather from the purchase of commodities – the mentality of “consumerism.”  Social scientists believe that this point in history radically changed the way Americans view life and work.  A shift from scarcity to consumption was adopted – a state of being that has grown stronger over the years. 

In the 1980’s, the computer revolution increased the demands of employee output.  It also brought new complaints of work/life balance-related stress.  The cases of stress and depression jumped dramatically during this timeframe.  As an example, the number of workers’ compensation claims from “mental stress” rose from 1,844 to 15,688 cases in the state of California alone from 1980 to 1999.  There was also a significant increase in workplace violence and absenteeism.

Burnout is the last act of the stress cycle.  Stress turns into burnout when one suffers a loss of physical and emotional resources too great to be replaced.  When our coping efforts fail to produce results, we are prone to crash and burnout.  Burnout triggers include overwhelming workload, lack of support and reward, loss of control, and interpersonal conflict.

Burnout develops from a condition of endless, chronic stress, in which emotional resources are stripped away until there is nothing left to counter the drain.  It is the gradual depletion of an individual’s pride, purpose, and passion.  The result is a three-way, mind-body shutdown as evidenced by:

  1. Emotional exhaustion
  2. Physical fatigue
  3. Cognitive weariness.

The financial services industry is a main culprit of burnout.  Pressure to perform in our industry requires significant time, energy, and commitment.  Conditions of burnout continue to rise at an alarming rate in the field of insurance and risk management. 

Strategies to Achieve Work/Life Balance
You must make room in your life to take care of your physical and mental well-being.  It is essential that you attempt to balance all priorities of your life.  The following represent 10 suggested strategies to achieve work/life balance:

  1. Self Awareness.  The first and most important step to achieving proper work/life balance is your understanding of the importance of mind, body, and spirit.  Being “aware” will allow you to monitor stress levels, see danger signs, and take personal responsibility for your physical and mental well-being.  As your self-awareness grows, you will gain a sense of confidence over work/life balance.
  2. Support from Family and Friends.  In our great quest for balance between work and life, there is perhaps no more important attribute than your relationships with family and friends.  Getting the family aspect of your life right will enormously help you achieve and maintain life-to-work balance.  Support and encouragement from friends is also essential.  As you embark upon strategies to improve work/life balance, begin by turning to family and friends.
  3. Nutrition and Exercise.  Physical stamina is not a luxury in today’s fast-paced business climate – it is a required element for high performance.  Your mind and body cannot operate at full potential if you have poor nutritional habits.
  4. Exercise is also an important strategy to work off stress.  Exercise is essential to being healthy.  Choose an activity you enjoy.  Possibly one of your hobbies can be combined with an exercise program.
  5. Hobbies.  You may be so busy with work that you no longer have time for hobbies.  Having a hobby is essential to work/life balance.  It lets you escape from the rigors of work to focus upon something you enjoy.  Time completely absorbed in an activity unrelated to your business will do wonders for your productivity.  It will also give your mind and body a well-deserved rest from work.
  6. Recovery Strategies.  Professional athletes plan recovery cycles into their intense training programs.  They understand that their mind and body need time to recuperate from strenuous activity.  Work is no different.  Your work/life balance plan should incorporate recovery breaks into your daily or weekly routine.  These can be anything from a 5-minute walk at lunch time to dinner and a movie with family and friends to a weekend golf game.
  7. Sleep.  Sleep deprivation is a major issue for people under stress.  If you make it a habit to skimp on sleep, you may not even remember how it feels to wake up fully rested.  Sleep is an essential ingredient to work/life balance.  Make sleep a priority for a week and see how it impacts your performance.
  8. Stuff.  For many people, it is the “stuff” in their lives that causes stress.  Stuff runs the spectrum from unfinished projects to personality clashes with co-workers to a messy office.  Too much stuff depletes energy and causes stress and anxiety.  Stop and recognize all the stuff in your life.  You will gain immediate confidence and clarity as you begin to remove the stuff from your life.
  9. Learn How to Say “No.”  High achievers get ahead by taking on projects and handling them efficiently and effectively.  Far too often, the same high achievers are the go-to people in the office.  It is logical.  If a high achiever is so good at projects, let him or her handle more and more problems and issues.  If you are a high achiever, you must learn to say “No.”  Do not let someone else’s problem or responsibility become yours.
  10. Time Management.  You have heard the term “time management” a thousand times.  You may not have a time management issue.  Rather, you have become so conditioned to multi-tasking that you have forgotten to do just one thing at a time.  Your ability to focus on one issue at a time will reduce anxiety and stress.
  11. Rearranging Priorities.  Work/life balance means having equilibrium with all priorities of your life.  Please consider a simple exercise.  List the priorities of your life from 1 to 5.  Your priorities may include personal interests, family time, hobbies, and exercise.  Now, analyze the percentage of time you currently spend on these priorities.  It is likely that you experience frustration from the fact that your priorities are out of order.  Rearranging your priorities and designing a plan to measure progress is an important component of your work/life balance plan. 

Work/life balance is essential for a rewarding career.  You owe it to yourself to make sure that the proper balance is in place.