Emerging technologies, which allow risk managers to capture data in a meaningful way, are allowing managers to do so at lower cost and with less disruption than in the past.

Cloud computing, mobile computing and predictive analytics, offer a ticket to get beyond conventional claims and loss management, and into data collection techniques that are truly innovative.

In a November report titled “Worldwide Risk Technology Spending – 2011 Analysis and Forecasts,” IDC Financial Insights predicts that worldwide information technology spending pertaining to risk functions will reach more than $74 billion by 2015.

In addition, the research concludes that growth in technology spending on risk management will outpace the growth of overall technology spending in financial services.

“Although our macroeconomic assumptions continue to point to downward pressure on overall information technology spending in financial services, in our estimation, the risk technology market is large and still growing at a good clip,” said Michael Versace, global risk research director at IDC Financial Insights.

For some risk managers, investments in risk management information systems is money well spent.

Jo Harris, vice president, risk management for Dean Foods, the $12 billion Dallas-based global food and beverage provider, said her company can offer a prime example of how to use predictive analytics tied to workers’ compensation claims to lower costs with less disruption, allowing Dean Foods to capture data and put it to use in a meaningful way.

In this case, an analytics application was embedded within Dean Foods’ risk management information systems. Harris said the basic concept was to find a way to predict which claims would benefit most from early intervention, which is often a major objective for employers, especially those who are self-insured for workers’ comp risks.

Dean Foods partnered with Marsh’s CS STARS, a popular vendor of risk management information systems, and Oliver Wyman, a global management consulting firm also owned by Marsh, to take on the challenge.

“We were looking to drive down our cost structure but also help employees get healthy and back to work as quickly as possible,” Harris said. “I told them we had all this data, but we needed a better way to take advantage of it.”

In March 2010, Dean Foods began using predictive analytics modeling tools that were “baked into” STARS Professional, the CS STARS’ risk management platform Dean Foods currently uses. Instead of sifting through 100 percent of its comp claims, Dean Foods, the nation’s largest diary producer with 25,000 employees worldwide and 40 different brands, now needs to closely examine just 30 percent of the claims singled out by the CS STARS platform to get better results.

For Harris, there is little doubt that using predictive analytics as part of its risk management approach is having a positive effect.

“It has resulted in an amazing ability to connect the dots with these early intervention cases and has been critical to success,” Harris said. Dean Foods has experienced a 20 percent reduction in loss costs in workers’ compensation, she said.

Ron Carlson, risk management information systems and process improvement manager for The Church of Jesus Christ of Latter-day Saints, in Salt Lake City, said that his organization has enjoyed early success using its risk management information system, provided by Riskonnect, a supplier of cloudbased technology for the risk management industry.

“Right from the start, we designed a request for proposal for a risk management information system around our functional requirements, areas of risk, as well as the vendor’s commitment for product growth,” he said.

“The vendors were evaluated on how well their written answers and product demos matched our business functional requirements.”

Based on the request for proposals, Carlson knew which vendors could provide incident intake, claim management, business intelligence, efficient system administration, compliance reporting, and other functionality it wanted to have in the future— especially the ability to move quickly when the need presented itself.

“There are so many changes in risk management that require very quick process changes,” Carlson said.

For example, in an area like Medicare reporting, if you are self-insured you have to be able to comply with any new regulations, and do it fast. In this case, Carlson said his organization once received a reporting requirement on a Friday and needed to go live with it by the following Monday. “With our new technology platform, we were able to move that from test to production in two hours, something we could have never done before,” he said.

Angela Trygestad, director of insurance services at the Schwan Food Company, a privately held, multi-billion-dollar company that manufactures and markets frozen foods through home-delivery, retail grocery and food service channels, said that Schwan is in the process of completing implementation of its new risk management information system.

The primary challenge is Schwan’s risk management department needs more consistent information faster, with much more flexibility than it had in the past. “We are trying to do more with less, to manage the same information and other risk management issues with less people,” she said. “Technology is the way to get there and within the past few years, the tools have expanded.”

Trygestad added that in her 10 years of experience, the risk management industry tended to lag behind other comparable industries when it came to adopting new, innovative technologies. But today, she said, it seems to be moving much faster and showing even better results than other industries.

“Today, with these new technologies, you have a much better chance to really learn about your company and complete process improvements and changes quickly,” she said. “There is just more time to focus, and you can spend more time on the analytics as opposed to the data gathering.”

That, she said, has led to a more strategic approach especially with renewals, which are critical as the hard market approaches. For Trygestad, the ability to aggregate data has been where technology has been extremely effective.

“Working with Excel spreadsheets is not very helpful,” she said. “You need a piece of technology set up to organize and slice and dice the data. Timing is everything. The more informed you are, the better you can adjust and adapt.”

Bob Morrell, Riskonnect’s CEO, said that some organizations still don’t even have risk management information platforms in place.

“They have something in place,” he said. “For example, they have systems that can run reports. Some can depend on the data and some can’t. But some don’t have a risk management information systems platform at all.”

To Morrell, the risk management world right now is a “muddy, messy” one when it comes to technology. It’s a fragmented market and some companies’ data batches aren’t necessarily going to fit well with some predictive analytics tools. But things are starting to change, with the adoption of cloud-based computing, mobile applications and other emerging technologies.

“Most people are still at the starting line,” he said. “I know how far old school technology was able to get people, and new technologies are able to take people much farther.”

Dean Foods’ Harris said the true challenge facing risk managers today is, while there is great data in multiple systems across the enterprise, there has yet to be a software analytics tool where you can bolt it on to different databases and run it in a standardized manner without requiring heavy information technology resources.

“You can do the job using the data available, but we are constantly looking for ways to bolt together these critical data bases,” she said.  “We may have a piece of it in our RMIS, but there also is great data in financial reporting and other company systems. Right now, we can get to it easily. We are trying to find that analytic tool to drive meaningful understanding of all data within the company.”

The trick, she said, is bolting multiple data sources into a single analytics platform without building a whole new, expensive infrastructure.

“It will happen,” she said. “Right now, we are using one aspect of technology to drive results, and that works. But now we want to do that in a way that marries multiple sources.”

TOM STARNER is a freelance writer who specializes in technology. He can be reached at riskletters@lrp.com.

The risk technology market continues to thrive despite continued uncertainty in the global economy. Riskonnect staff grew 65% in 2011 and continues to grow at a rapid pace in 2012, with new offices in Chicago’s River North District (opened last week) and opening in London in late March, 2012.

Leading the company’s new Chicago office is Trudy Prahler, Director of Professonal Services. Trudy comes to Riskonnect with more than 30 years of experience in many facets of the insurance and risk management industry.  In addition to managing client implementations and managing a team of service professionals, Trudy will also head Riskonnect’s Chicago office.  As a seasoned professional with a broad background in the industry, Trudy is highly respected by clients for her business knowledge and level of commitment to quality and timeliness. Previously, Trudy was with Chartis as a Regional Manager where she focused on delivering Risk Management Information System products and reporting solutions. She has also held positions at Marsh, RSKCO, and Zurich.

Joining Trudy in Riskonnect’s Chicago office are David Newhouse, JoAnn Ebert and Debbie Yurik. David Newhouse, Senior Account Manager, has 20 years of experience in the insurance and risk management industry. Before joining Riskonnect, he worked at Crawford & Company’s Risk Sciences Group (RSG) as a Senior Account Manager.  He specializes in managing Fortune 1000 accounts for Risk Management Information Systems needs, including application development, data reporting, data quality assurance, user training and project management.  Prior to his work at RSG, David worked at Aon Risk Services as a Senior Client Specialist.

JoAnn Ebert joined Riskonnect in November 2011 as a Senior Business Analyst in Riskonnect’s Chicago office. She is an effective technical professional with more than 14 years RMIS experience with excellent relational database and problem solving skills.  She is an expert in authoring complex analytic reports, designing/re-engineering processes and analyzing and defining business requirements.  She has a proven ability to lead multiple projects to deliver high quality technical solutions to clients. Before joining Riskonnect, she worked at Aon eSolutions.

Debbie Yurik, also based in Riskonnect’s Chicago office, joined Riskonnect in January as a Data Engineer. She previously worked at RSG, where she was a Technical Consultant and responsible for training members of the data load team. She graduated from St. Xavier University in Chicago with a Bachelor of Arts in Management Information Systems.

Based at the Riskonnect Corporate Offices in Atlanta are the following six new team members: Kelly Frost joins Riskonnect as a Project Coordinator. She has a unique blend of engineering, training, and communication proficiencies. Kelly is a results-oriented leader experienced with problem solving, developing and implementing solutions, and translating complex technical specifications and concepts into easily understood and practical solutions. Her industry experience includes Aerospace and Defense, Industrial Products, and Adult Education.

Evan Volgas joined Riskonnect in December 2011, as a Senior Business Analyst providing advanced report development and support internally and externally for users of Riskonnect applications.  Evan previously worked at Capital One, where he provided analytical support for the deposit pricing team. His work required expertise in SAS, T-SQL, and JCL/MVS.

Andrew Barnhart is a recent graduate of the Terry College of Business and the Honors Program at the University of Georgia.  He joins Riskonnect as a System Consultant. He will be a part of a team providing direct support to Riskonnect client users.  Before graduating with a dual-degree in Risk Management and Finance, he participated in the Riskonnect intern program.

Also joining as a System Consultant is David Regenwor.  He is a recent graduate from the Terry College of Business at the University of Georgia with a Bachelors degree in Management Information Systems.

Lisa Cantrell comes to Riskonnect as a Sales Analyst. She provides support to the Vice President of Global Business Development.  Lisa graduated from Kennesaw State University with a Business Administration degree in Marketing.

Joining the Data Services team is Matang Patel as Data Engineer. Matang is experienced in database activities including data modeling, database design and development, implementation, performance tuning and monitoring.  Matang has his Masters Degree in Computer and Electrical Engineering.

About Riskonnect, Inc.

Riskonnect, Inc. is the provider of a premier, enterprise-class technology platform for the risk management industry. As an independent innovator in risk management software, Riskonnect develops and markets a growing suite of software solutions on a world-class cloud computing model, helping clients elevate their risk management programs, safety solutions and programs for management of risks across the enterprise. Through its strategic, operational and insurable risk software applications, Riskonnect provides the risk management industry with the specific, configurable solutions needed to reduce losses, control risk and affect shareholder value. For more information about Riskonnect, contact us at www.riskonnect.com, email to info@riskonnect.com or call 770-790-4700.

“Riskonnect ERM was Riskonnect’s first product, introduced shortly after the company’s inception in July 2007,” commented Bob Morrell, Co-founder and CEO of Riskonnect. “With increasing global demand for Enterprise Risk Management programs among key stakeholders, and the integration of all risk and safety systems, Russell will be instrumental in helping guide the continued development of the application. Russell understands the complexities of risk at the operational level as well as at the strategic level. His expertise and first hand success at managing risk within diverse, global organizations combined with the Riskonnect ERM application will be extremely valuable in helping clients gain increasing value from the maturation of their ERM processes and programs.”

“Riskonnect has proven itself over the last four years to be able to produce effective and innovative solutions to many risk issues, particularly the development of claims management systems,” commented McGuire. “The company has also proven that it has the expertise to organize extremely diverse risk data, primarily risk exposures and loss data, and this expertise will be critical to the ongoing development of Riskonnect ERM where the three states of risk need to be managed – What has happened (e.g. losses), What is happening (e.g. incidents), and What may happen (e.g. Risks). To be part of this continuing development is a once-in-a-lifetime opportunity, and I’m looking forward to working with existing and new clients of Riskonnect.”

ERM is gaining acceptance as a critical component in the strategy of successful organizations. While no two organizations are likely to be at the same level of ERM maturity, they need varying degrees of support for the ERM process. The use of the highly scalable Riskonnect ERM platform provides the essential support system. Each client’s unique configuration allows the client to manage risks at their maturity level and to extend the process as needed. Extending the system is simple and quick – for example, to add a new location can occur immediately, even if there may be different languages and currencies to be used. The inclusion of key risk indicators can be combined with key performance indicators to ensure the organization is managing its risks within its designated risk appetite.

Russell is a proven leader in the insurance and risk management field with more than 25 years experience. He is a member of the Technology Advisory Council and has been a member of the ERM Committee until the expiry of his three-year term at the end of 2011 at Risk and Insurance Management Society (RIMS). His certifications include ARM, ALCM, FANZIF, DipBS, and FIRM. Russell came to Riskonnect from Milliman, Inc. where he served as a Senior Consultant and Product Manager. There, he evaluated and designed Governance, Risk and Compliance (GRC) tools to support Enterprise Risk Management processes for global clients. Russell has worked on risk related projects in more than 25 countries including Great Britain, France, Germany, Italy, North America, and Asia/Pacific. He has also held positions at Alliance Data Systems where he served as Corporate Risk Officer; Risk Labs, a company also founded by Bob Morrell; and Tillinghast-Towers Perrin.

Client and User Growth
The company has increased its client count by 250%, and its user count by 40% year over year, from December 2010 to December 2011. Additionally, Riskonnect’s geographic footprint has increased significantly, with users across the European Union and North America, and more than 40 countries worldwide, including China, India, and Brazil. The company’s international growth has been fueled by Riskonnect’s unmatched ability to meet the needs of the global marketplace, in such diverse sectors as logistics, energy, global shipping and retail.

Commenting on the company’s growth and success within its client base, Roger Dunkin, Vice President of Professional Services, said, “An interesting metric we continue to see is that, within the first year of working with us, clients increase their user base by 75% on average. As we begin each new client implementation, users rapidly adopt the system and start evangelizing new ways to create efficiencies and improve their business processes. It is very common for clients to immediately begin adding users within the risk team and among other business partners throughout the organization.”

Company Growth
The risk management software market continues to thrive despite the stagnant global economy, fraught with uncertainty. Riskonnect staff has grown 65% in 2011 and continues to expand, with new offices opening in Chicago’s River North District and London in the first quarter of 2012.

Riskonnect’s London office marks an especially important milestone, with a commitment to serving the needs of the EMEA region. Riskonnect’s platform is uniquely positioned to provide solutions with fast performance, configurable workflow and real-time data integration. Riskonnect products have been enhanced to include global policy management, real-time exposure gathering, multi-currency and multi-lingual features that are demanded in EMEA and throughout the world.

In June 2011, Riskonnect completed the SSAE 16 Type I examination of its technology applications and related services, augmenting its platform security certifications and becoming the only cloud-computing risk technology provider with third-party certification for all parts of its operations. Riskonnect will complete the SSAE 16 Type II examination in very early 2012. These examinations confirm that Riskonnect’s security meets the latest industry standards.

Awards
In September 2011, Risk & Insurance magazine recognized Bob Morrell, CEO of Riskonnect, as a 2011 Risk Innovator. The Risk & Insurance® Risk Innovator Award recognizes innovators across different industries who have, in the past year, demonstrated creativity and excellent execution in risk management. These individuals see risk differently and have resolved risk-related problems in a unique or innovative way.

“I am honored to again receive this award from Risk & Insurance Magazine”, says Bob Morrell, CEO of Riskonnect. “But the true test of our organization is the advances in risk management we see within our clients. They are truly enabled to move their program forward in ways that were never possible before.”

About Riskonnect, Inc.
Riskonnect, Inc. is the provider of a premier, enterprise-class technology platform for the risk management industry. As an independent innovator in risk management software, Riskonnect develops and markets a growing suite of software solutions on a world-class cloud computing model, helping clients elevate their risk management programs, safety solutions and programs for management of risks across the enterprise. Through its strategic, operational and insurable risk software applications, Riskonnect provides the risk management industry with the specific, configurable solutions needed to reduce losses, control risk and affect shareholder value. For more information about Riskonnect, contact us at www.riskonnect.com, email to info@riskonnect.com or call 770-790-4700.

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Press Contact:
Kelly M. Barton
Vice President, Marketing
770-790-4710; Kelly.barton@riskonnect.com

Riskonnect Inc. has brought a solution for the “discoverability” issue to the world of risk management, but that’s only one part of how Chatter, a new, award-winning collaborative capability is helping Riskonnect and its clients succeed at the business of risk management.

This is all part of Riskonnect’s technology platform powering its RMIS, claims administration and other risk technology applications. Chatter enables risk professionals to work more efficiently and closely with colleagues by effectively communicating across a single application, according to Bob Morrell, CEO at Riskonnect, who won a Risk Innovator 2011 award from Risk & Insurance Magazine for his work with Chatter.

Tani Pack Downing, director of the State of Utah’s Division of Risk Management, a Riskonnect client, says that with the explosion of social media into personal and professional lives, it’s natural for business to be looking at ways it can utilize tools such as Chatter to maximize communication internally and externally.

“Chatter has been used by our office to communicate among project leaders and Riskonnect during the implementation of our new claims system,” Pack Downing said. “It allows the users to choose which elements of the project they want to follow and see all relevant communications as well as comment on any threads.”

She added that the next phase of Utah’s enterprise information system will require integration of other State information systems and Utah intends to use Chatter for communication with Riskonnect on those projects as well.

Morrell said Chatter brings a revolutionary shift in how people communicate at work, just as social networking applications have fundamentally changed communications with friends and family. Morrell noted that when you consider the accelerating adoption rate of new communication technologies (from land lines to cell phones), and the even more rapid ascent of social media for personal communications, Chatter is the logical business application.

For example, he said, a new member joins LinkedIn every second. In 2009 social users (now totaling around 1.1 billion) surpassed email users. Today’s generation uses social apps to communicate.

“The business world is poised for a similar game-changing paradigm shift,” Morrell said. “As Chatter spreads throughout organizations, you will see significant decreases in email, more efficient collaboration among co-workers and business partners, and better-informed decision making – as the silos of information throughout organizations are knocked down. Risk managers need this type of technology to enable collaboration across the enterprise.”

Interestingly, Morrell added, it is taking time for risk professionals to understand Chatter’s applications, and to overcome those who fear discoverability issues, which of course are mitigated by Chatter’s open, transparent nature.

Morrell explained that communication and collaboration using Chatter is private and secure, but a major upgrade from standard email. In fact, Chatter can replace most email within a risk management or claims department.

“Chatter offers something better than email,” Morrell said. “It provides the context for the discussion, and allows others who are involved or who should be involved to follow and contribute to the discussion.”

Morrell explained that in the world of risk management, the question of discoverability is always an issue, especially around email. Basically, email is “discoverable” as part of the claims process, and so is almost all information and documentation in risk technology systems.

“So we are left with best practices around communication,” he said. “But with email, the communication is done in a vacuum, if the right people are not copied. And that can lead to some very negative consequences.”

With Chatter, discussions can be viewed securely by others who are following a specific claim or issue, so cultural best practices, or peer pressure – the natural inclination to monitor yourself in front of others – keeps users in check with their messaging and collaboration. Additionally, the ultimate control remains with management, who also can choose to monitor discussions.

“Concerns about internal communication around claims dissolve as greater oversight becomes a part of the culture,” Morrell said.

Simply stated, Chatter is a part of the Riskonnect system, enabling the risk management team, and all others in their Riskonnect user network, to collaborate around risk-related information. The status of important projects, claims, incidents, legal matters and other topics is automatically pushed to them, in real-time. They can “chat” or “comment” on a claim, an incident, occurrence, or any other object in the system.

Users also can choose which information to follow and which conversations to be a part of. For example, they can follow a specific claim and Chatter will trigger automatic, real-time updates anytime new information or new comments are added on that claim record. They can also choose to follow a dashboard or document attached to Chatter.

“If that dashboard is refreshed, they are alerted. If a new version of that document is posted, they are alerted,” Morrell said, adding that system administrators also have controls over Chatter to limit certain people or groups. Additionally, users have controls to set up private groups among departments or teams.

Morrell says not only is Riskonnect using Chatter successfully internally, but clients also are using Chatter extensively as a part of the implementation process – documenting requirements, providing status updates on project tasks, and documenting decisions.

Goals Riskonnect clients describe for using Chatter as a part of their ongoing operations include:

• Improved collaboration around risk-, claim- and safety-related issues
• Better decisions, as risk and safety professionals share concerns and work together toward optimal solutions
• Faster communication between departments and business partners
• Movement of conversations from siloed email inboxes to a collaborative platform, where appropriate people or teams can contribute to important updates, discussions and solution of issues
• Conversations within context of the related claim, incident, legal matter, document, dashboard, report, and other risk-related information
• Improved status updates

Best of all, Riskonnect offers Chatter as an integral part of its total system, with no additional costs. As a result, users are seamlessly added, as they are with all other Riskonnect upgrades. Riskonnect system administrators simply have the choice to enable Chatter when an organization is ready to implement the platform.

“Chatter automatically pushes the status of important projects, claims, incidents, legal matters and other topics out to risk management staff in real-time,” Morrell concluded. “It’s an innovation that just makes risk managers, and risk management, more effective and efficient, and it also addresses critical discoverability issues within the claims process at the same time.”

Bob Morrell
CEO
Riskonnect Inc.

From the In-Box to the Chatter Box

Chatter’s most interesting feature is that it can replace all email within a risk management or claims department.

When Bob Morrell began talking to clients about an exciting new collaboration and communication platform his company would soon be offering, he considered using comparisons to some of the popular mainstream social networking apps.

Instead, said Morrell, CEO at Riskonnect, the risk management information system provider based in Marietta, Ga., his company chose “business collaboration” to describe its latest client innovation. Why? Because even though the new tool, known as Chatter, has a strong social networking aspect to it, that’s not what makes it so powerful.

Also, Morrell didn’t want clients to think the platform was just another pretty face, you might say.

So what gives Riskonnect’s Chatter, or enterprise business collaboration platform, its true punch, and what makes it innovative? Morrell believes the Chatter technology is much more than just a networking platform, as it delivers a solution for the very critical issue of discoverability to the world of risk management.

Morrell, whose original vision helped turn Chatter into reality, said it’s all about communication, collaboration and control. Chatter’s most interesting feature is that it literally can replace all email within a risk management or claims department.

In doing so, Chatter provides the “context” often missing from email discussions, and easily allows others who are involved, or who should be involved, to follow a discussion and contribute.

“For risk management, the question of discoverability (of a claim) is a critical issue, especially around email because email is discoverable,” Morrell said. “But with email, the communication is done in a vacuum and if the right people are not copied or are part of the discussion, problems can and often do arise.”

Morrell explains that with Chatter, discussions are an open book, and can be viewed by others who are following a specific claim or issue. As such, the natural inclination to self-monitor in front of others keeps users in check with their messaging. Things that should not be part of the record can quickly be changed, and senior management can follow along. “Concerns about internal communication around claims dissolve with Chatter, as greater visibility and transparency becomes a part of the culture,” he said.

To see all the innovators across all categories click here

Riskonnect Announces Completion of SSAE 16 Examination,
Augmenting It’s Current Third-Party Security Certifications

Marietta, GA August 17, 2011 – Independent risk management software company, Riskonnect, Inc. announced today that the company completed the SSAE 16 Type I Examination of its technology applications and related services, in June 2011. The examination was performed by an independent accounting and auditing firm. Completion of the SSAE 16 Type I Examination indicates that selected Riskonnect processes, procedures and controls have been formally evaluated and tested. The Company is currently undergoing the SSAE 16 Type II Examination and expects to announce completion of that portion of the examination by year end.

“This provides end-to-end third party attestation for our platform and everything we do for our clients, and is supplementary to the best-in-class assurance report available from our platform provider,” commented Bob Morrell, CEO of Riskonnect. “Riskonnect is now the only cloud-computing provider with third-party certification for ALL parts of its operations. Also, Riskonnect provides complete documentation of its related assurance reports providing full transparency to our prospects and clients.”

Riskonnect and its platform provider offer unmatched security and third-party certification. In addition to the latest technology, world-class security requires ongoing adherence to best-practices. To ensure this adherence, Riskonnect’s platform provider continually seeks relevant third-party certification, including ISO 27001 (an attestation covering the management of information security risks), the SysTrust audit (the recognized standard for system security), and SAS 70 Type II (an attestation for internal corporate controls). Through Riskonnect, not only does its platform provider offer the most secure risk management solutions but that same platform also provides solutions for top financial, health care and other industries who demand the highest levels of security with their data.

In addition to third-party platform certifications of its platform provider, Riskonnect provides third-party assurance of its risk technology applications and related services. The SSAE 16 Examination (which replaces SAS70 as of June 2011) attests that Riskonnect has established control objectives covering the following areas: physical and environmental security; computer operations, including backups and incident handling; information security; application change control; data communications; business intelligence; and receipt, input, output and processing of data.

“These examinations confirm that our security meets the latest industry standards,” added Antonio Dabraio, Riskonnect’s Vice President, Research & Development. “Riskonnect’s technical operations are truly best in class in the risk management market.”

About Riskonnect, Inc.
Riskonnect, Inc. is the provider of a premier, enterprise-class technology platform for the risk management industry. As an independent innovator in risk management software, Riskonnect develops and markets a growing suite of software solutions on a world-class cloud computing model, helping clients elevate their risk management programs, safety solutions and programs for management of risks across the enterprise. Through its strategic, operational and insurable risk software applications, Riskonnect provides the risk management industry with the specific, configurable solutions needed to reduce losses, control risk and affect shareholder value. For more information about Riskonnect, contact us at www.riskonnect.com, email to info@riskonnect.com or call 770-790-4700.

Read more: The Marietta Daily Journal – No change to DMDA millage rate

Companies are looking more closely at risk these days, and they are finding not only that is there more risk to manage but that managing it well can help them be more competitive.

They are making substantial investments in risk management, and their risk managers have become more highly regarded by their peers, with top risk officers more frequently taking seats at CEO tables. Companies are also increasingly appointing chief risk officers, who in many instances report directly to the chief executive officer.

We know all this because Accenture recently completed a global risk management study, for which we contacted nearly 400 risk professionals across 10 industries. The research findings reflected to a remarkable degree the challenges we find clients across industries struggling with worldwide in today’s business environment.

Major changes have occurred in risk and in risk management since Accenture conducted its previous study, in 2009. There has been a clear maturation of risk management capabilities across all industries, a rapid march up the business value chain and the development of governance and organizational structures that give risk a louder voice at the executive table.

Companies today are spending more time and effort advancing their risk management capabilities, and they are using them more aggressively, well beyond the realm of compliance. In 2009 the business community was still in a state of shock and struggling to recover from the global economic meltdown. Today, companies are looking to address the full range of business risks in a way that supports long-term growth.

Based on the research results and our own experience, we see five major changes in the ways companies now look at risk management:

1. Risk management today is central and strategic for all industries. The executives at more than 80% of the companies we surveyed, across all industries, consider risk management to be a key function in dealing with marketplace volatility and organizational complexity. Eighty-sixpercent identify risk management as a helping them deal effectively with the increasing volatility in the economic and financial environment, and 83% see it as driving better management of organizational complexity.

2. Executives see their risk management capabilities as important for future profitability and long-term growth. The vast majority consider risk management important or critical for growth and profitability. As the risk director for an Asia-Pacific financial services firm told us, “Our risk organization and functions were established to support and enable our organization to achieve strategic goals such as sustainable growth and profitability, competitive advantages, and capital management. Put simply, we recognize risk as a part of the strategic agenda.”

3. Companies are establishing comprehensive enterprise risk management programs. Businesses are taking risk management seriously from a structural and technological perspective and spending in smart ways to make it more effective. More than 80% of the survey respondents overall have an enterprise risk management (ERM) program in place, or plan to have one in the next two years.

4. Companies are establishing C-level oversight of the risk management function. Since 2009, there has been an increase in appointments of chief risk officers (CROs) or their equivalent, executives with the primary responsibility for risk management. Over two-thirds of all survey respondents have a CRO operating with that title. Another 20% have an executive fulfilling those responsibilities but without the title.

5. Executives expect their investments in risk management to increase over the next two years. Eighty-three percent of the respondents see risk management investments (which include salary and benefits for risk employees, professional services, technology costs, facilities, and travel) increasing in the next two years. Of those, 21% foresee an increase of more than 20%, and 62% foresee a smaller increase.

Although companies have increased their risk awareness along with their investments in risk management, significant shortfalls still exist. The types of risks to which companies are exposed, as well as their severity, are growing, and companies are increasingly concerned about the spectrum of risks—from supply chain to operations to regulation to reputation. Financial fraud and crime are also on the rise.

Companies must continue to improve their risk measurement capabilities. To support business growth, rather than just protect against adverse events, they need better ways to assess their risk-bearing capacity. Advanced analytics are becoming increasingly essential. With better structuring of data and more effective use of analytics, companies can become better prepared for risk and more nimble in their response to events.

For instance, one European bank that operates in several countries has implemented a credit risk management system that enables it to use analytics to improve the pricing of its credit products. By actively managing its credit portfolio using the analytics capabilities, the bank has improved its risk-return ratio, and it is better positioned to pursue growth opportunities and to understand the contingencies when capital is in short supply. The new streamlined capabilities allow it to integrate the results of more than 15 systems.

Risk management capabilities today are more critical, more connected, more strategic, and in general more valuable to enterprises as they execute their business plans. Companies’ ability to see around corners is still far from perfect, but our research indicates that risk management has become a primary focus for organizations as they allocate capital and seek sustainable ways to establish and maintain competitive advantage.

Steve Culp is the managing director of the risk management consulting service line at Accenture, the global management consulting, technology services and outsourcing company.

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By TOM STARNER, who writes about technology.

Meet Jeff Gehrke, one of a newly emerging breed of risk managers. He faces the challenge of ensuring the safety of children in about 1,000 schools across the United States.

As vice president for risk management at the Learning Care Group Inc., a for-profit learning company based in Novi, Mich., Gehrke also must help senior management reduce costs and make strategic decisions that can ensure successful long-term growth and sound planning.
Gehrke answers to the needs of two very different constituencies: a group of very young clients scattered across the country and senior managers with an eye on bottom-line efficiencies.

Prior to arriving at Learning Care Group, which operates schools for kids from six months to 13 years old, in 2009, there was no risk management information system in play at all.

Learning Care Group managed its risks without the software programs, which are today considered a critical component of managing corporate risk.

Gehrke quickly realized the company needed better technology to generate the best possible risk management outcomes. With a profit-centered company, he had to make a strong business case first.

“We had so many different data sources from which we were pulling information that it was very difficult to do any sort of meaningful reporting on a timely basis to underwriters or to company management,” Gehrke said. “Claims were coming from as many as nine different insurance carriers and third-party administrators (TPAs) data systems as well as state workers’ compensation funds.”

He’s not alone. More risk managers are trading in the persona of safety expert/insurance buyer and transforming themselves into a bona fide value-producing, strategic member of the management team. In a stagnant weak economy, they have to.

They are doing so by embracing emerging risk management technology that, when used effectively, can earn them a seat at the table within the top of their respective organizations.

What was sufficient four or five years ago from a risk manager isn’t enough anymore, said Bob Morrell, president and CEO of Riskonnect, a risk management software and platform provider in Marietta, Ga.

“There are still risk managers out there doing the basics, and that may be fine for their situations,” he said. “But there also is a large and growing chunk of the market that needs and wants to do more.”

“Increasingly, risk managers are asked to be part of new client accounts and strategies, and chief risk officers — a growing top management position — are sitting on boards,” said Neil Smith, emerging risks and research manager within the exposure management team at Lloyd’s. “That is a relatively new development.”

With newer, more innovative risk management information system options, Smith said, collecting and acting on data to focus on “upside risk” is given a more systematic, effective path, as the latest technology helps risk managers to get there more quickly.

“It’s changing as we speak,” he said. “From a RMIS technology standpoint, we have not reached the end point by any means.”

Gehrke needed to be able to consolidate data from all these sources in order to compare information between states, between years, between operational areas of the company. “We didn’t have the ability to do that very effectively with our existing system,” he said.

His answer was to use a system provided by Aon eSolutions. The product, sold under the brand RiskConsole but known internally as DataStar within Learning Care Group, converts data into information in a way that would tell a story all on its own, a story that would enable managers and employees to act.

When Gehrke went to his manager, Chief Financial Officer Robert VanHees, to discuss a risk management technology addition, the reaction was positive, but VanHees challenged Gehrke to pay for the cost of a system with savings the system could generate immediately, either through fewer claims, or through premium reductions, or both.

It came as no surprise that everyone in the company was interested in a new system. During the selection process there was a representative from each department with an interest in what the product could do for each of them. There was also a demonstration of how the technology could be built across the entire company, expanding the risk manager’s role in terms of overall strategy and impact.

“Everyone had a seat at the table and a vote in the final selection decision,” Gehrke said. No less then nine representatives from within the company had a stake in the new system.

Apart from reducing costs, Gehrke and his risk management team have been lengthening their view of value and return on investment. They are taking a “long view.” To that end, one of Gehrke’s goals is establishing a holistic approach, or “one version of the truth” related to the company’s risk and insurance information.

“This is a perfect example of taking the platform and making it configurable and delivering an expanded view of how to manage risk,” said Phillip Lucas, director of global product management for Aon eSolutions. “Within RiskConsole, Jeff has worked with solutions, and is getting ready to go on to business intelligence as well, which will further extend his ability to tell the story about what is driving risk within the organization.”

Gehrke might look at the cost of insuring each school at the per-school level, breaking it down by fire or by flood risk, or even by demographic risk, Lucas said.

It’s the kind of data that could be used to help Gehrke and his company push into new markets, and an example of how the risk management information system can develop “upside risk” options.

“We’re not doing it right now, but it’s certainly a strong possibility,” Gehrke said.

This new breed of effective, innovative risk managers, in fact, provides wide-ranging strategic influence in an organization. Often, they offer a strong voice in company growth objectives, while simultaneously leading enterprise risk management efforts.

Linsey Elliott, project manager for risk management at DHL Global Business Services in Westerville, Ohio, said her company has had risk management technology systems in place, but it recently began consolidating data into a single system where it can house all claims, exposures, policy information, and link all the data silos.

“Risk management here has greater visibility because we have much more data at our fingertips now,” Elliott said. “With the press of a button we get executive summary snapshots, which our senior management needs. We also are creating efficiencies within our entire organization.

“Our RMIS technology, which keeps getting easier to use and more powerful, is giving risk management a real foothold within the organization,” she said. “We have streamlined and migrated to the latest and greatest technology and gained visibility and respect of our business line partners. We are able to provide them with information and trends out there and help make strategic recommendations.”

In fact, Elliott said risk management is consulted on nearly every major contract and large-scale business transaction, whether it involves new business or renewals.

“Having the data at our fingertips can make for a quick, educated business decision,” she said. “The better we get, the more credibility we gain, and the more often they will come to you for advice when making a strategic business decision.”

The new solutions allow managers to take an enterprise risk management approach, and to look beyond the typical financial concerns of the past, said Bill Diaz, president and CEO of Chicago-based CS Stars LLC.

Morrell of Riskonnect calls it “hitting the critical issues dead on.”

As the definition of risk continues to broaden, and risk managers on the leading edge are going beyond claims management and looking more holistically at risk.

“We see many risk managers suffering because they are using technology for only five to ten percent of what they do,” Morrell said. “They want to do more and they can if given the chance.”

Gehrke got his chance and took advantage of his company’s new-found focus on risk management. He’s now much more than insurance buyer and safety expert, as a result.

“Our safety manager and I had an hour with our CEO, COO and CFO regarding a safety-related issue, and we used the data we have from DataStar to identify solutions, sort them and then build a strategy to fix an issue,” he said.

“Before DataStar, we could not have told that story. This time, we had little trouble getting their attention.

“Each new generation of RMIS software gives added’color’ to the story,” Gehrke said. “And that can translate into a significant opportunity to contribute to business strategy, which goes well beyond the typical risk management role.”

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