Brian Proctor, Risk Manager, Capital Power Corporation
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Transcript of Brian Proctor, Risk Manager, Capital Power Corporation
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CONFERENCEPRESENTS
Property Loss ControlProperty Loss ControlCritical to Maintain Efficient OperationsCritical to Maintain Efficient Operations
ORORAdditional Work for Unforeseen GainAdditional Work for Unforeseen Gain
Brian Proctor, Risk Manager, Capital Power CorporationBrian Proctor, Risk Manager, Capital Power CorporationDavid Thompson, Operations Vice President, FM GlobalDavid Thompson, Operations Vice President, FM Global
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Setting the Stage: Business BasicsSetting the Stage: Business Basics
BusinessRaw products
Outside Services
FinishedProducts / Services
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Setting the Stage: Business BasicsSetting the Stage: Business Basics
CostsBuildings
EquipmentPeople
SuppliersSales / Customers
$ $
Value
$
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Risk Management :Risk Management :Protecting the Value of your BusinessProtecting the Value of your Business
BUSINESSPeople
BuildingsEquipment
Are all elements of the business equally Important to a well functioning Business?
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Risk Management :Risk Management :Protecting the Value of your BusinessProtecting the Value of your Business
People
BuildingsEquipment
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Looking at the Loss Prevention ComponentsLooking at the Loss Prevention Components
People EquipmentBuildings
Safety Programs
Emergency response
Training
Audits
Succession Planning
Efficiency Studies
Maintenance Programs
Emergency response
Training
Inspections
Capital requirements
Maintenance Programs
Contingency planning
Operator Training
Inspections
Life studies
Performance monitoring
When Times are tough where do we cut? What risks do we assume when we sacrifice programs and procedures?
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What is a Highly Protected Risk?What is a Highly Protected Risk?
A A highly protected riskhighly protected risk (HPR) is a (HPR) is a location at which all reasonable physical location at which all reasonable physical and human element loss prevention and human element loss prevention measures have been implemented to measures have been implemented to protect buildings, equipment and contents protect buildings, equipment and contents from all losses including those caused by from all losses including those caused by natural hazards and change is being natural hazards and change is being managed proactively to maintain this managed proactively to maintain this status.status.
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Where is your Business Today?Where is your Business Today?
Level I
Level II
Level III
Purchase InsuranceNo Formal Loss prevention programsInspection services report on conditionsGenerally Non -HPR
Corporate Risk Management Strategy -Formal Loss Prevention Programs
-Corporate evaluations to ensure compliance- External evaluators (FM or Broker)- Generally account is HPR
Company Wide Risk Management Strategy -Change management policy
-Site level self audits of Loss Prevention Programs- Loss prevention Inspectors consult rather than evaluate- Superior HPR
Highly Protected Risk (HPR) Management Levels
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What are the benefits of an HPR risk?What are the benefits of an HPR risk?
Operational Cash Flow Operational Cash Flow PlusPlus
Growth OpportunitiesGrowth OpportunitiesOffset byOffset by
Financial RiskFinancial Risk
SuppliersSales / Customers
$ $
Value
$
What is Value?What is Value?
Business
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Managing Financial RiskManaging Financial RiskThe Risk Quality Tie-inThe Risk Quality Tie-in
0
200
400
600
800
1000
1200
Loss Dollars inMillion USD
Q1 Q2 Q3 Q4Risk Mark Quartile
Loss Dollars VS Quality
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Managing Financial RiskManaging Financial RiskThe Risk Quality Tie-inThe Risk Quality Tie-in
02468
1012141618
Percentage
Q1 Q2 Q3 Q4Risk Mark Quartile
Cash Flow Volitility
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Managing Buildings?Managing Buildings?New Construction managedNew Construction managedContractor ManagementContractor ManagementMaintenance of Fire Protection EquipmentMaintenance of Fire Protection Equipment Inspect Fire Protection EquipmentInspect Fire Protection EquipmentManage ImpairmentsManage ImpairmentsHousekeeping Housekeeping Emergency responseEmergency responseTRAINING & EDUCATIONTRAINING & EDUCATION
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Managing Equipment?Managing Equipment?Understand your ProcessesUnderstand your ProcessesUnderstand your Critical ObjectsUnderstand your Critical ObjectsUnderstand InterdependenciesUnderstand InterdependenciesPreventative MaintenancePreventative MaintenanceOperator TrainingOperator TrainingContingency PlanningContingency PlanningLife StudiesLife Studies
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How do you figure out where you stand?How do you figure out where you stand?
Assessment of current conditionsAssessment of current conditions In House evaluations?In House evaluations? Outside evaluations?Outside evaluations?
Scope of AssessmentScope of Assessment Fire?Fire? Natural Catastrophe?Natural Catastrophe? Equipment Hazards?Equipment Hazards?
Breadth of assessmentBreadth of assessment All Facilities and processesAll Facilities and processes Strategic facilities and processesStrategic facilities and processes Inside onlyInside only Supply Chain exposuresSupply Chain exposures
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So you’ve done all that ….So you’ve done all that ….You know where you stand….You know where you stand….You are on the path to HPRYou are on the path to HPR
The Tough QuestionThe Tough QuestionWhere does this path End?Where does this path End?
Are you there?Are you there?
If you are Congratulations…If you are Congratulations…
If you are not you have a journey to makeIf you are not you have a journey to make
Because…Because… Assessment without Action is BureaucracyAssessment without Action is Bureaucracy
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What is HPR for you?What is HPR for you?What is your risk tolerance?What is your risk tolerance?What are the business consequences of a What are the business consequences of a
loss?loss?These questions should help define your These questions should help define your
focus and actions.focus and actions.
Not all Risks are Created Equally
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So you now knowSo you now know
1) where you are1) where you are2) where you want to Go2) where you want to Go
You need a vehicle….You need a vehicle….
How do you get there?How do you get there?
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Getting Corporate Support forGetting Corporate Support forProperty Risk managementProperty Risk management
StakeholdersStakeholders
Corporate ManagementCorporate ManagementSite ManagementSite ManagementEmployeesEmployeesRisk ManagementRisk Management
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Corporate ManagementCorporate ManagementOpportunitiesOpportunities
Understand decision making Understand decision making (Use the right Language for your Culture)(Use the right Language for your Culture)
ReliabilityReliabilityProfitabilityProfitabilityShare ValueShare ValueSafetySafety
Share industry news that supports your initiativesShare industry news that supports your initiativesBe InnovativeBe Innovative
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Corporate ManagementCorporate Management
ChallengesChallengesConvincing Management that Loss Control adds Convincing Management that Loss Control adds
ValueValueDeal whenever possible with proven solutionsDeal whenever possible with proven solutionsPre-planning of new constructionPre-planning of new construction
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Site ManagementSite ManagementOpportunitiesOpportunities
Understand Local decision making processUnderstand Local decision making process Plan and communicate inspection protocolsPlan and communicate inspection protocols
Make sure they understand expectationsMake sure they understand expectations Before, During and After inspectionsBefore, During and After inspections Have exit interviews so no one is surprised when report issuedHave exit interviews so no one is surprised when report issued Attend and facilitate inspections whenever possibleAttend and facilitate inspections whenever possible Prioritize issues Prioritize issues
Be a Resource for the SiteBe a Resource for the Site
You ARE Corporate and You ARE there to helpYou ARE Corporate and You ARE there to help
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Site ManagementSite Management
ChallengesChallengesConvince Management that Loss Control adds Convince Management that Loss Control adds
ValueValueRecognize they are busy people and have other Recognize they are busy people and have other
competing priorities – safety, environment, internal competing priorities – safety, environment, internal auditaudit
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EmployeesEmployees
OpportunitiesOpportunitiesEducation and Communication are keyEducation and Communication are key
They need to Understand the HazardsThey need to Understand the HazardsThey need to Understand their RoleThey need to Understand their RoleThey need to be supported and supportThey need to be supported and supportiveiveThey need to know their efforts are appreciatedThey need to know their efforts are appreciated
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EmployeesEmployees
ChallengesChallengesApathy can destroy the best laid corporate plansApathy can destroy the best laid corporate plansMomentum is difficult to create and harder to Momentum is difficult to create and harder to
maintainmaintainSuccess takes both management and employee Success takes both management and employee
buy-in and commitment.buy-in and commitment.
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Risk ManagementRisk ManagementOpportunitiesOpportunities
Know what your Objectives areKnow what your Objectives are Be realistic with your ObjectivesBe realistic with your Objectives Learn from the past – Do your homework!Learn from the past – Do your homework! Know your Peer Group outside your companyKnow your Peer Group outside your company
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Loss Control – A Risk Manager’s PerspectiveLoss Control – A Risk Manager’s Perspective
Establish Your CredibilityEstablish Your Credibility
Learn your business and the languageLearn your business and the language
Get to know the plants, equipment types and technologyGet to know the plants, equipment types and technology
Work closely with the plant managers throughout the yearWork closely with the plant managers throughout the year
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A Risk Manager’s PerspectiveA Risk Manager’s Perspective
Pre Site VisitsPre Site Visits
Ensure lots of advance notice, schedule of attendee’s, Ensure lots of advance notice, schedule of attendee’s, duration of visit and agenda sent ahead of timeduration of visit and agenda sent ahead of time
Try for consistency with loss control representatives from Try for consistency with loss control representatives from broker and insurers – results are fewer repetitive questions broker and insurers – results are fewer repetitive questions and picturesand pictures
Ensure the loss control representatives are trained in your Ensure the loss control representatives are trained in your business.business.
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A Risk Manager’s PerspectiveA Risk Manager’s Perspective
Site VisitsSite Visits
Make sure arrival of personnel is coordinated, on time and Make sure arrival of personnel is coordinated, on time and any security issues have been taken care of before you any security issues have been taken care of before you arrivearrive
Document ‘action’ items by all parties and ensure follow Document ‘action’ items by all parties and ensure follow up with an email upon return to office – no gaps.up with an email upon return to office – no gaps.
Ensure exit meetings are conducted with the appropriate Ensure exit meetings are conducted with the appropriate personnel in the roompersonnel in the room
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A Risk Manager’s PerspectiveA Risk Manager’s Perspective
Report Review and DistributionReport Review and Distribution Review reports and compare to exit meeting notes to Review reports and compare to exit meeting notes to
ensure accuracy of recommendations along with ensure accuracy of recommendations along with designated course of action designated course of action
Reports to plant manager, corporate management and Reports to plant manager, corporate management and your broker’s loss control engineer along with priority your broker’s loss control engineer along with priority rankings and comments – include any additional materialrankings and comments – include any additional material
Don’t lose the momentum of the visitDon’t lose the momentum of the visit – the longer you – the longer you wait to distribute the reports, the less chance in wait to distribute the reports, the less chance in succeeding with implementation of the recommendationsucceeding with implementation of the recommendation
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A Risk Manager’s PerspectiveA Risk Manager’s Perspective
Follow upsFollow ups Ensure periodic follow ups are made with plant Ensure periodic follow ups are made with plant
management. Works as a good reminder management. Works as a good reminder
Focus on the recommendations that all involved believe Focus on the recommendations that all involved believe in. Support plant management in the budget processin. Support plant management in the budget process
Let’s admit - Some recommendations are not feasible Let’s admit - Some recommendations are not feasible and are not cost effective (need to be able to and are not cost effective (need to be able to demonstrate a return for the monies spent). Work demonstrate a return for the monies spent). Work together for a reasonable alternativetogether for a reasonable alternative
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A Risk Manager’s PerspectiveA Risk Manager’s Perspective
Selling to Senior ManagementSelling to Senior Management Understand the concepts that drive decision making Understand the concepts that drive decision making
within your organization within your organization
Understand the budgeting and budgeting approval Understand the budgeting and budgeting approval processprocess
Must be able to convince Senior Management that loss Must be able to convince Senior Management that loss control adds value to the organizationcontrol adds value to the organization
Incorporate the human safety element in the conversation Incorporate the human safety element in the conversation – people are generally perceived as more important than – people are generally perceived as more important than propertyproperty
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A Risk Manager’s PerspectiveA Risk Manager’s Perspective
Selling to Senior Management (con’t)Selling to Senior Management (con’t) Be innovative – implement scorecard systemsBe innovative – implement scorecard systems
Be willing to present at plant manager meetingsBe willing to present at plant manager meetings
Become involved on advisory committeesBecome involved on advisory committees
Share industry loss information with managementShare industry loss information with management
Find a Champion and work with them – help them in Find a Champion and work with them – help them in selling concepts (such as strategic spares)selling concepts (such as strategic spares)
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A Risk Manager’s PerspectiveA Risk Manager’s Perspective
ConstructionConstruction Loss control really starts here! Establish standards in the Loss control really starts here! Establish standards in the
bid documents. Easier to implement FM standards at this bid documents. Easier to implement FM standards at this stagestage
Risk improvements more cost effective at this stage than Risk improvements more cost effective at this stage than trying to retro-fit an operating facility trying to retro-fit an operating facility
Project management goals will always be different than Project management goals will always be different than operational management. Know which battles you want operational management. Know which battles you want to win going into the project. Communication and $$’s will to win going into the project. Communication and $$’s will be key.be key.
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A Risk Manager’s PerspectiveA Risk Manager’s Perspective
Roadblocks in our BusinessRoadblocks in our Business Focus has been moved from reliability to profitability.Focus has been moved from reliability to profitability.
Examples include extending maintenance outages, Examples include extending maintenance outages, pushing machinery and equipment to their limits pushing machinery and equipment to their limits
Any cost benefit analysis on loss control initiatives must Any cost benefit analysis on loss control initiatives must demonstrate that the expenditure will have a positive demonstrate that the expenditure will have a positive impact on the bottom lineimpact on the bottom line
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Property Loss ControlProperty Loss Control
QUESTIONSQUESTIONS
David ThompsonDavid ThompsonVice President, OperationsVice President, OperationsFM GlobalFM GlobalEmail; Email; [email protected]
Brian ProctorBrian ProctorManager, Insurance Risk ManagementManager, Insurance Risk ManagementCapital Power CorporationCapital Power CorporationEmail; Email; [email protected]
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