Risk managers cannot afford to be fooled by last year's healthy salary increases and need to take steps to assure their current positions as well as set the stage for future raises, promotions and moves to bigger, more challenging firms, the profession's leading placement executive suggests.
Bill Perry, president of New York-based Logic Associates, offered his list of "Survival Tips For Risk Managers In A Challenging Economy" during an interview with National Underwriter, the exclusive co-sponsor of his annual Risk Management Compensation Survey (see page 12).
His first piece of advice is for risk managers to never stop educating themselves and expanding their capabilities. "You have to keep learning new skills and keep broadening your knowledge and expertise," he said, urging all risk managers to go for their MBA, if they don't already have that degree.
Even if a risk manager decides to move on, or is forced to look elsewhere because their company goes under or cuts costs by outsourcing their function in a worsening economy, "the more you know and the more you can do, the better chance you'll have of landing another job--most likely a better-paying one," he said.
Mr. Perry also urged risk managers to stay aggressive--which can go against the grain for many in a profession usually marked by caution and risk aversion.
"You need to make yourself more visible in your corporate hierarchy and profession," he said. Whether it's doing a captive feasibility study or working with floor managers to cut down on workers' comp injuries, "you have to be front and center to be noticed. Don't just hide behind stacks of spreadsheets in your office. Be a high-profile part of the management team. Be a leader."
The key, Mr. Perry explained, is to be proactive, rather than simply reacting to losses and crises as they arise. "Be part of the solution, not just part of documenting the problem," he said.
Above all, he emphasized, remain positive at all times.
"Risk managers deal in a lot of worst-case scenarios, but that doesn't mean you need to be a negative person," he said. "No matter how gloomy a situation gets, always be the upbeat one who comes up with new ideas. Keep moving forward; don't just go into a defensive shell. You want to be the innovative problem-solver, not just the messenger of bad news."
Those risk managers in the best position to advance their careers are creative and cutting-edge, according to Mr. Perry. "Keep up with the latest solutions out there, and don't be afraid to be bold," he said.
"Whatever you do, with the softening market, don't fall back into the old habit of just being an insurance buyer again," he warned. "The more proactive you can get, and the less you depend on the whim of the market for your performance, the more secure your job will be, and the brighter future you'll have in this profession."
Risk managers also need to get the word out about challenges they've overcome and contributions they've made to the bottom line, according to Mr. Perry.
"Risk managers are not often known for their communication skills," he said. "It's an area they must work on to make sure they get their ideas across effectively, in terms senior management can understand, and so they get credit for the steps they take that save the company money."
To accomplish this, he added, risk managers "need to develop excellent presentation skills, whether it's a PowerPoint pitch to the board or a simple e-mail to the CFO. A risk manager has to be his or her own PR department so senior managers are made aware of what they're contributing to the bottom line. You have to quantify that impact and communicate it."
While Mr. Perry said "there is a difference between trumpeting and communicating," he insisted risk managers "have to let everyone know you have their backs covered on whatever exposures they're facing. That's even more important today, with globalization and new regulatory compliance demands adding new risks."
In the end, he said, "the CFO and the vice president of finance must be able to go to the risk manager and deal with someone who can deliver a report everyone on their board can understand."
He warned that "even among financial people, insurance is esoteric," especially if captives, catastrophe bonds or other complex programs are involved. "You have to make it clear what your plan will do in very practical terms," he said.
Meanwhile, as more firms depend on exports for growth, while others import a larger share of their products or components, risk managers must fully appreciate the implications of globalization in the supply chain to remain relevant, noted Mr. Perry.
Indeed, with the cheap dollar making American exports one of the country's few economic bright spots, Mr. Perry emphasized the importance of risk managers having the knowledge and skills to handle international exposures.
"With the way even smaller corporations are expanding globally, risk managers must be up to speed on the new exposures that await them," he said. "For some, that might mean on-the-job training, but that's where a positive, can-do attitude and an eagerness to learn will serve you well."
He noted that "having international experience improves your attractiveness enormously in this global market, adding that "it could make the difference in a hiring decision if the company you're targeting has a booming export or import business."
