Over the last few years, research has shown that an increasing number of employees want to understand the “why”—or otherwise have purpose—behind what they do to be committed until the end.
Executive Summary
Why is strategy important? Why is ERM important?Carol Williams, a risk management and strategy consultant for P/C insurers, provides some answers—and also answers a different "why" question: Why is it important to have an ERM framework that is rooted in strategic objectives?
Short answer: P/C insurance carriers need the ability to adapt to the constantly moving target of pursuing strategic goals in a volatile, uncertain, complex and ambiguous world.
As busy executives, the answer to “why” is even more imperative. You are not going to be thrilled or motivated to spend your scarcest resource of all—time—on something for which you can’t readily answer this timeless question.
In the context of an insurance company’s operations, the answer to this question is easy in most cases. As an insurance carrier executive, you know why your company purchases reinsurance or has a meticulous underwriting process. Their purpose is clear and pretty uniform from one company to the next.
Unfortunately, the answer is not so clear cut for other areas, with two of the most significant being strategic planning and enterprise risk management.
