Jerry Kysela has approximately 25 years of experience as a risk management department director and relationship manager. He currently serves as resident managing director of Aon’s North-Central Ohio region, which includes offices in Cleveland, Akron, Youngstown and Columbus. Kysela oversees the region’s client services, business development and overall operations.
Q. How can a business determine its risks?
Businesses need to work across all operations and internal departments in identifying, analyzing, understanding and mitigating risks. This should include all corporate operations/divisions/subsidiaries both domestic and foreign as well as various staff functions, including finance, legal, health/safety and human resources and possibly more dependent upon corporate structure, size and industry. This will assure a broad spectrum of input and an enterprisewide view. Some of our larger, more complex clients have established either formal or informal risk management committees or enterprise risk management committees, including representatives from the various functions previously noted to assure this process is led and managed on an ongoing basis.
Q. Are companies facing different risks with today’s economy?
The vast majority of risks are the same, but many new exposures or increased severity of existing exposures is certainly a concern. For example, a heightened concern around credit risk is of obvious concern. Additionally, a potential for an increase in workers’ compensation claims as a result of both lower safety and loss controls budgets as well as the moral hazard of workers concerned with the company’s ability to employ them over the long term. Additionally, understanding your supply-chain risk and the financial viability of the organizations involved in your supply chain is of greater importance. Consider a key supplier, or even noncritical supplier, whose product is required to complete your work in process. If they go out of business, what is the impact to your process and do you have a backup? Additionally, today, several insurers and reinsurers have their own financial challenges. What is your counterparty risk associated with the insurance marketplace? What is your insurance representative doing to help you understand this exposure? Dependent upon the client’s industry, many more concerns related to the current economy exist.
Cleveland
Special Report