You may think a Risk Management Information System (RMIS) will solve all of your broken risk management processes. But I’m going to let you in on a little secret…it won’t.  The only way to truly fix your broken risk management processes is to understand your processes from start to finish. By doing so, you will uncover hidden process “waste” within them and identify inefficiencies in your current workflows. A RMIS will help make you faster, more efficient and effective but a RMIS is only as good as the processes it supports. As Bill Gates has said, “The first rule of technology used in a business is that automation applied to an efficient operation will magnify the efficiency. The second is that automation applied to an inefficient operation will magnify the inefficiency.” From my 15+ years working as a Risk Manager and serving Risk Managers when working in big three consulting, I’ve helped numerous organizations fix their broken processes. Here are the 4 steps I recommend to supercharge your risk management processes so you can maximize your results.

1. Perform a workflow assessment. Start by clearly documenting your current risk management processes including a detailed mapping of individual workflows from start to finish. Risk management workflows to consider include renewal data collection and submission, claims administration, incident management and premium allocations. This can be done manually or with a software application (PowerPoint, Visio, etc.). When detailing the workflows, include key employees and stakeholders across the organization to ensure everything is captured. Look closely at the overall flow and review each step in the workflow and evaluate if each step is a value or non-value added task. Identify waste in the process by looking for key types of Lean waste (see below) within your current risk management processes. Here are some examples of various types of Lean office workflow inefficiencies or waste that may be identified in your process:

  • Transportation: Moving an item/product/information from one place to another. Example: walking paperwork to another department or collecting hand-written incident reports from various departments within your organization.
  • Inventory: Item/product waiting to be processed. Example: allowing claims to accumulate while waiting to be processed or allowing transactions to queue up.
  • Waiting: Delays caused by shortages, approvals or downtime. Example: idle time in any process waiting for action or property values waiting for supervisor approval.
  • Over-processing: Adding more work than the customer is willing to pay for. Example: doing more work than is necessary when the customer (or internal stakeholder) does not want the service.
  • Over-production: Making or processing more than is needed. Example: printing extra copies of a contract, policy, or Certificate of Insurance.
  • Defects / Rework: Correcting mistakes. Example: correcting an omission from a claim or inaccurate loss exposure.

2. Define technology and process challenges. Thoroughly analyze the risk management processes you documented. Discuss why existing process steps are performed the way they are, and then identify bottleneck areas and the root causes. Do bottlenecks occur because of factors such as employee turnover, lack of visibility into the end-to-end process or process metrics, or do they occur because of more deep rooted issues such as legacy systems and disparate technologies? Make sure to pay close attention to electronic versus paper based processes, as paper based processes are usually an easy target for improving productivity. Discuss how technology can optimize your workflow in these areas and prioritize your issues so the ideal future state can be developed.

3. Design future state workflows. Create maps that depict how the improved process will work. Focus on elimination of waste, bottlenecks and non-value add activities. The goal should be to deliver the most value to your internal and external customers while reducing process time and increasing satisfaction. For processes that can be improved through technology, it is beneficial to create a solutions matrix that aligns the available technology with end-user requirements and identifies any potential gaps.

4. Develop a plan of action that your organization can execute for success. Develop the action plan based on your goals and the problems identified. Document each improvement goal, the purpose of the improvement, the actions needed to achieve it, who is responsible for each action, and what benefits should be realized. You should estimate the time required to complete each action and then prioritize which improvements to tackle first. Clearly communicate the goals and timeline with the key stakeholders so the initiative is supported and change is embraced. Involving all key stakeholders will enhance organizational support and adoption of best practices.

Improving your risk management processes can seem overwhelming, but the time and effort is well worth the investment.  Employee productivity and capacity will improve through elimination of burdensome tasks and maximizing use of your RMIS, allowing employees to focus their efforts on more strategic activities. Good luck on improving processes at your organization! Please keep me posted on your progress and reach out if you have any questions: Anthony.Veasey@marshclearsight.com.

Anthony Veasey is Vice President of Consulting at Marsh ClearSight. Anthony has over 15 years of experience helping organizations with large-scale process analysis and improvements, Lean Six Sigma implementation, and change management. Anthony also has extensive experience in strategic planning, current and future state process development and design of supporting metrics.

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