Roads to Resilience

4.  Desire to Improve: the case study organisations undertake various activities to learn from adverse events and circumstances. Once lessons have been drawn from incidents and near-misses, resilient organisations make changes to their strategy, tactics and operations . They have a desire to constantly improve performance and make changes to organisational structures, if appropriate. The case study organisations have procedures in place to ensure that the lessons learned from adverse developments are incorporated into future plans. The lessons learned from an incident are often an agenda item at board meetings. To address the challenges faced in the industry, Zurich has found that structure and processes such as risk identification and development of contingency plans are not enough: “ As a global organisation it is also about how you actually disseminate governance structures, performance management structures, risk management structures that permeate the entire organisation with consistency. So I think another facet of resilience is an industrialised and standardised set of processes, that operate consistently, but you can have all the best processes in the world but if you haven’t got the right capability in terms of people then again you will be blindsided by issues that you’ve not foreseen or perceived ” (CEO UK General Insurance). The emphasis is on people taking responsibility and being accountable, but not being punished for making mistakes, provided they are open and honest and learn from them: “ The culture we are trying to instil in the company is that it is okay to make mistakes if they happen within the framework that the company has set. Then it is all about how you deal with them ” (CFO General Insurance). The push for openness is so strong that “ good news travels fast but bad news travels faster, but whereas some companies have a culture of punishing bad news – we almost encourage it ” (CEO Global Life). The company culture is based on a set of values called ‘Zurich Basics’, covering integrity, teamwork, striving for excellence, being focused on the customer and sustainability, which they believe drives sustainable Case study: Zurich Insurance – make better risk decisions

The boxed extract below from the Zurich Insurance case study demonstrates that the organisation proactively seeks to ensure that the review and adapt principle is fully implemented. The Zurich way of learning from mistakes is transparent and supportive for staff. A learning culture 2 has been established and this improves the level of resilience. When the review and adapt principle is embedded, the culture of an organisation is enhanced and greater resilience is achieved. The most important intended outcome is that the organisation makes better risk decisions in the future.

performance and also should underpin behaviours. For example: “ Making money would not be an excuse for poor business practice: it is one test of the moral and commercial ethics of this business ” (Chief Actuary General Insurance). The support for these values is strong and consistent and “ if people don’t believe in the basics, then they need to find somewhere else not to believe in them! ” (CEO Global Life). A key part of the culture is also the focus on customers. Zurich provides tools, such as ‘Zurich Risk Room’, which can be downloaded onto an iPad, to help customers understand and consider certain types of risk. This means that “ our resilience is not only because we have a broad portfolio of risk but also because we help our customers become more resilient ” (Head of Sales, Distribution and Marketing Global Corporate, General Insurance). Zurich considers itself a ‘thought leader’ in risk management and this is a differentiator with some customers. “ We consider what sort of knowledge do we have that we can share with our customers from an enterprise risk perspective that can make them a better risk and that makes them less likely to suffer loss or if they do suffer loss to recover much easier … that allows customers to make better risk decisions ” (Head of Sales, Distribution and Marketing Global Corporate, General Insurance). “ Because we sell trust, we usually get a better response and more loyalty from people, who have had a claims experience – it is actually the best advertisement, but it is expensive! ” (CFO General Insurance). For more insights into resilience at Zurich Insurance, refer to the full case study in Appendix A

2 In many ways the ubiquitous terms learning culture, and learning organisation do not do justice to the approaches of the case study organisations. In both their no-blame and learning organisational culture, the case study organisations go further than what is commonly understood.

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Roads to Resilience: Building dynamic approaches to risk to achieve future success