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BRUSSELS, 20-21 October www.ferma.eu
FORUM 2015 Venice, Italy 4-7 October
Cultural Risk workshop
Attitudes to risk across cultures
Candida Snow – Snow Culture & Communication
Culture in risk and insurance Tim Astley – Zurich Insurance Company Limited
Global business, global culture?
John Ludlow – Director, Leading in Risk Limited
Moderator: Julia Graham
President of FERMA
2
BRUSSELS, 20-21 October www.ferma.eu
FORUM 2015 Venice, Italy 4-7 October
risk compliance a contract deadlines planning corruption trust leadership …
BRUSSELS, 20-21 October www.ferma.eu
FORUM 2015 Venice, Italy 4-7 October
Culture is the accepted values, customs, attitudes and behaviours of a group of people
Culture is the filter through which
we perceive, evaluate and judge
National
Corporate Professional/
department/team
BRUSSELS, 20-21 October www.ferma.eu
FORUM 2015 Venice, Italy 4-7 October
Symbols
Heroes, role models
Rituals, practices
Values
What is culture?
BRUSSELS, 20-21 October www.ferma.eu
FORUM 2015 Venice, Italy 4-7 October
Value differences can be explained by four
dimensions of national culture
Power distance « PDI »
Individualism / Collectivism « IDV »
Masculinity / Femininity « MAS »
Uncertainty avoidance « UAI »
Professor Geert Hofstede
BRUSSELS, 20-21 October www.ferma.eu
FORUM 2015 Venice, Italy 4-7 October
Power distance
Low power distance
(PDI-)
responsibility delegated
hierarchy for convenience
same rules for all
initiative
High power distance
(PDI+)
responsibility at top
hierarchy is existential
privileges
obedience
BRUSSELS, 20-21 October www.ferma.eu
FORUM 2015 Venice, Italy 4-7 October
0 – 20
21 - 40
41 - 60
61 - 80
81 - 100
> 100
Power distance
BRUSSELS, 20-21 October www.ferma.eu
FORUM 2015 Venice, Italy 4-7 October
Individualism
Collectivism
the group: “We”
group responsibility
value standards differ for
‘in-group’
loss of ‘face’, shame
relationship oriented
Individualism
the individual: “Self”
individual responsibility
value standards apply to
all
loss of self-respect, guilt
task oriented
BRUSSELS, 20-21 October www.ferma.eu
FORUM 2015 Venice, Italy 4-7 October
0 - 20
21 - 40
41 - 60
61 - 80
81 - 100
Individualism
BRUSSELS, 20-21 October www.ferma.eu
FORUM 2015 Venice, Italy 4-7 October
Masculinity
feminine (MAS -)
doing your best
levelling
consensus
failure allowed
sympathy for the underdog
masculine (MAS +)
being the best
status
competition
failure is a disaster
admiration for achievers
BRUSSELS, 20-21 October www.ferma.eu
FORUM 2015 Venice, Italy 4-7 October
0 - 20
21 - 40
41 - 60
61 - 80
81 - 100
Masculinity
BRUSSELS, 20-21 October www.ferma.eu
FORUM 2015 Venice, Italy 4-7 October
Uncertainty avoidance
Low uncertainty avoidance
(UAI -)
low need for structure and rules
comfortable with unfamiliar risks
what is different is interesting
relaxed
High uncertainty avoidance
(UAI +)
need for structure and rules
comfortable with familiar risks
what is different is dangerous
stressful
BRUSSELS, 20-21 October www.ferma.eu
FORUM 2015 Venice, Italy 4-7 October
0 - 20
21 - 40
41 - 60
61 - 80
81 - 100
> 100
Uncertainty avoidance
BRUSSELS, 20-21 October www.ferma.eu
FORUM 2015 Venice, Italy 4-7 October
Action and Implementation
Time
Action
German, Austrian
Dutch, Danish
American / UK
Belgian, French
BRUSSELS, 20-21 October www.ferma.eu
FORUM 2015 Venice, Italy 4-7 October
Distribution of scores within the EU
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Cultural aspects in a risk / insurance context
Tim Astley
Ferma conference, October 2015, Venice
BRUSSELS, 20-21 October www.ferma.eu
FORUM 2015 Venice, Italy 4-7 October
Inward
Regulatory drive
How to ensure good / effective risk
management
Search for consistency across all
levels of the business (decision
making)
Two lenses – inward and outward looking
Why is it important to an insurer?
26
Outward
Need for full understanding of risk and resilience (current approach – on-the-ground, grading)
What determines how a company will handle a loss?
Need metrics to determine what ‘good’ looks like
BRUSSELS, 20-21 October www.ferma.eu
FORUM 2015 Venice, Italy 4-7 October
Ability to gain insight is different
Inward
How to approach these two challenges?
27
Define ways to embed them
e.g.
• Commitments in personal objectives
• Behaviour of ‘key risk takers’
• Understand through employee surveys
• Clarify relationship between business
decisions and risk tolerance
• Analyse ‘incident’ responses – learning
curves
Identify what attributes are important
e.g
• Decision making
• Leadership
• Staff involvement
• Outcome orientation
• Meritocratic
• Market focus
• Innovation
Outward
• Relies more on experience, broad indicators and gut feel
BRUSSELS, 20-21 October www.ferma.eu
FORUM 2015 Venice, Italy 4-7 October
Examined claims with significant business interruption
(consequential loss) component
Identified key elements that influenced how well claim was
handled
We built a picture of what ‘good’ resilience looks like
Looking from the outside
28
BRUSSELS, 20-21 October www.ferma.eu
FORUM 2015 Venice, Italy 4-7 October
BI Claims lessons learned
29
Determining Resilience
Is there a clear understanding /
definition of the critical activities?
If something did go wrong, what
would the company do?
Has the company demonstrated the
credibility of alternatives?
What broader business issues might
influence decision making?
Impact assessment
Recovery strategies
Proven / tested
capability
Business culture ?
BRUSSELS, 20-21 October www.ferma.eu
FORUM 2015 Venice, Italy 4-7 October
Need to understand:
Market dynamics and business drivers
Consistency of objectives
Silos, decision making
Track record
Employee profile
What does ‘culture’ consist of?
30
BRUSSELS, 20-21 October www.ferma.eu
FORUM 2015 Venice, Italy 4-7 October
What does ‘good’ look like?
31
Positive Negative
How good is the information flow?
Are there any concentrations of knowledge?
What is the ‘residence time of key employees*?
(* might be the entire workforce or influential individuals)
How easy is it to make a decision?
Is there consistency of purpose across functions / businesses?
How homogeneous is the organisation?
How successful is the business? How dominant is the financial imperative?
How well do they understand their business?
To what extent does technical skill align with business skill?
How well have they done it before (responded to a crisis)?
How are external relationships managed?
How cooperative is management?
What evidence is there of good management controls?
Looking (from the outside) for indicators that might predict behaviours in ‘stress’ situations
BRUSSELS, 20-21 October www.ferma.eu
FORUM 2015 Venice, Italy 4-7 October
‘Hard’ aspects of risk management and planning are
important
Ensure the ‘soft’ side is not ignored
Requires an understanding of culture
Show how organisations can be adapted
Enhanced resilience
Conclusion
32
BRUSSELS, 20-21 October www.ferma.eu
FORUM 2015 Venice, Italy 4-7 October
Global business
Global culture?
John Ludlow
Director
Leading In Risk Limited
+44 (0)7808 094542
BRUSSELS, 20-21 October www.ferma.eu
FORUM 2015 Venice, Italy 4-7 October
Business yesterday
• Business structured around geographies
• Oversight limited
• Staffed with professional expat leaders
• Policies mainly local and often detached from PLC policies
• Business built in the local culture and environment
• Products and services delivered to regional needs
All my troubles seemed so far away
BRUSSELS, 20-21 October www.ferma.eu
FORUM 2015 Venice, Italy 4-7 October
What changed
• Greater trade between and within regions
• High levels of labour migration within and between countries
• Out-sourcing and off-shoring of production and support
• Supply-chains have become more international
• Shift in the balance of power towards Eastern economies
• Internet based systems and communication
• Globalisation of consumer expectations
• Intangible assets, like brands, have risen in value
Complex, Integrated, Fast, Consistent and Transparent
BRUSSELS, 20-21 October www.ferma.eu
FORUM 2015 Venice, Italy 4-7 October
Brands evolved with the economy
As the economy evolved, driven by competition and enabled by technology, so too have brands
• Branded experiences became the new growth area and global markets enabled global brands
Raw Materials
Goods
Services
Experiences
BRUSSELS, 20-21 October www.ferma.eu
FORUM 2015 Venice, Italy 4-7 October
Brands are more important & fragile than ever
Brands now represent Business Ecosystems
•Complex and opaque supply chains – but can I trust what I am buying?
•Web-based technology – but who has my data and what are they using it for?
•Brand franchising – but who am I trusting?
Trust is in decline for many
•Social media is enabling consumers to communicate
•Regulators are moving to protect consumers
•Reputation that took years to build can be destroyed in an instant
Strong global brands are trusted and valuable
BRUSSELS, 20-21 October www.ferma.eu
FORUM 2015 Venice, Italy 4-7 October
Strong and resilient global brands
Centrally driven to be relevant, distinctive, repeatable and consistent
• Leaders of their business ecosystems
• Mature Leadership
• Matrix Management
• Manage to outcome and effect rather than to task
Operate responsibly and sympathetically in local cultures
• Disciplined
• Stakeholder aware and consumer centric
• Proactively responsible
• Responsive to issues
BRUSSELS, 20-21 October www.ferma.eu
FORUM 2015 Venice, Italy 4-7 October
Strong global brands think globally
Strong Leadership
• Purpose, beliefs and values
• Vision; mission, ambition, strategy and behaviours
• Organisation of the business resources by market segments and regions
Attractive Brand Stories
• History and culture of the business – how things get done and why
• Brand position in the competitive landscape
• Clarity about customers – who they are and what they expect
• Product & service essentials and differentiators
BRUSSELS, 20-21 October www.ferma.eu
FORUM 2015 Venice, Italy 4-7 October
Strong global brands think globally
Common and proactive management systems
• Policies, procedures and controls within the business
• Technology and information systems
• People development and management systems
• Active communication
• Stakeholder groups
• Internal and External
• Broadcast and Listen
BRUSSELS, 20-21 October www.ferma.eu
FORUM 2015 Venice, Italy 4-7 October
Leadership at IHG - Vision
BRUSSELS, 20-21 October www.ferma.eu
FORUM 2015 Venice, Italy 4-7 October
Behaviours
Winning Ways
• Identified by staff members from around the world
• Behaviours that they felt made IHG successful
Mature Leadership
• Doing the right thing and showing we care for others
• Working together and treasuring diversity
• High performance culture
BRUSSELS, 20-21 October www.ferma.eu
FORUM 2015 Venice, Italy 4-7 October
Purpose
Guest centric mission
Emotional calling
Business ecosystem
Brand strategy
BRUSSELS, 20-21 October www.ferma.eu
FORUM 2015 Venice, Italy 4-7 October
Leadership at IHG - Ambition
BRUSSELS, 20-21 October www.ferma.eu
FORUM 2015 Venice, Italy 4-7 October
Leadership at IHG - Trust
IHG is a brand led business
We champion the trusted reputation of our brands to drive our performance
We consistently deliver on our brand promises
Trust & Love
Brands
People
Delivery
BRUSSELS, 20-21 October www.ferma.eu
FORUM 2015 Venice, Italy 4-7 October
Build Trust By Doing Business Responsibly
RESPONSIBLE
DELIVERY
RESPONSIBLE
BRANDS
RESPONSIBLE
PEOPLE
& risk
measure Compliance
Monitor program delivery &
emerging issues
deliver
consistent & repeatable
experiences
do no harm do good winning
live our
effort is ensure
valued
RESPONSIBLE
BUSINESS
maturity ways
BRUSSELS, 20-21 October www.ferma.eu
FORUM 2015 Venice, Italy 4-7 October
Responsible Business Programmes
Example:
Safe Hotel
BRUSSELS, 20-21 October www.ferma.eu
FORUM 2015 Venice, Italy 4-7 October
Protect Reputation By Managing Crises
PREVENT
•Risk assessments
•Responsible Business Programmes
•Crisis response and crisis
communications
•Risk and Crisis
Management capability
RESPONSE
•Media monitoring,
intelligence gathering
•Crisis training, scenario
planning
PREPARE
•Lessons learned, review or revise strategy
•Rebuilding stakeholder trust
RECOVER
Pre-Crisis
/ Incident
Post-Crisis
/ Incident
BRUSSELS, 20-21 October www.ferma.eu
FORUM 2015 Venice, Italy 4-7 October
Summary – it is all about trust and reputation
Acting locally to build and maintain personal relationships
West – we leave home, go to work and do a deal
Plus in America the law comes first
East – think relationships and marriage
Thinking globally to deliver consistently
Leadership and Vision
95% global discipline and brand stories
Common Systems
Active Communication
Thanks for your support !
John Ludlow
Director
Leading In Risk Limited
+44 (0)7808 094542
Tim Astley
European Regional Practice Leader
Zurich Insurance Company Limited
Candida Snow
Snow Culture & Communication
www.snowcc.info
T: +31 38 466 2478
M: +31 655 842 762