INSIDER QUARTERLY | The Inclusion Factor


The Inclusion Factor - Insider Quarterly (Insurance)Having spent many years working with the insurance profession, driving conversations from the original “ABC of diversity” and “We have to do this!” through to deeper inclusion discussions, it is encouraging that I am now encountering increasing numbers of senior teams who truly see creating an inclusive environment as a key lever in achieving their strategic goals.

Initially, the link was understood purely in the sense of matching customers – if we don’t do this we won’t be able to sell to “them”. Thankfully, today we are seeing such a different approach. But have we all missed a crucially important piece?

Management committees and executive teams are now making the critical link between creating an inclusive environment and the success of specific products, distribution approaches and geographies.

Ensuring, ahead of the need to do so, that the internal culture really does welcome difference and is geared towards ensuring that difference can flourish over the longer term makes sense at every level.

As competition to enter new markets continues to increase, the awareness of combining all manner of talented people and ensuring we get the best from all of them becomes business-critical.

More recently we have been exploring that very bedrock of insurance – risk – and seeing parallels and lessons from other sectors that the profession might learn from; not only in terms of their clients, but their corporate and individual approach.

To understand the importance, we first need to appreciate that an inclusive environment cannot be made to happen because of an edict from above. Senior team buy-in is essential, however, an organisational understanding about one of the key levers is even more vital; insurance organisations attempting to create environments ready to welcome the next artificial intelligence or deep learning rock stars must first recognise the impact of bias within everyone.

Flawed decisions
Recent global projects have taken us into the realms of health and safety and I believe there is much that the risk profession can learn from this work.

QBE’s Issues Forum paper, “Behavioural Safety in Construction” (August 2015), cites disasters such as the West Fertilizer Company explosion (2013), The King’s Cross fire and the Herald of Free Enterprise capsizing (1987), the Space Shuttle Challenger explosion (1986), the Piper Alpha fire (1988) and the Chernobyl nuclear accident (1986) all as being attributable, at least in part, to flawed decisions, driven by individual perceptions.

The report comments: “When considered within the wider context of a particular culture, it becomes apparent that individuals’ behaviours, and the perceptions that drive those behaviours, are key to determining the safety performance of an organisation.”

Joshua Howgego, who reported on BP’s 2010 Deepwater Horizon disaster in New Scientist, says that rig staff had tested the concrete seal on the excavated well before removing the drilling column. The results indicated that the seal was not secure and that removing the column might result in a catastrophic blowout. So why were the signs ignored?

Disaster analyst Andrew Hopkins of the Australian National University in Canberra says that workers viewed the test as a means of confirming that the well was sealed, rather than approaching it with a view to finding out whether it was sealed or not.

So the same part of our brain that can count someone out of running for a job because they trigger some unconscious negative associations can also prevent us from properly assessing risk – leading to some very tragic outcomes.

In short, not only do our preconceptions appear to us as truths, we are also scuppered when a shot of dopamine acting as a reward signal in our thinking brain makes us ignore certain truths.

Macho mistakes
QBE’s “Issues Forum” recognises that underpinning behavioural safety is a belief cycle linking beliefs, feelings, behaviours and results in a self-affirming loop. If we believe that something is lower-risk than is really the case, our confidence and bravado will drive positive behaviours that may (with a measure of good fortune) carry us through. Our perception is then reinforced and confidence increased.

But how does this play out in a group situation where differing opinions and assumptions should make us look more deeply and assess risk more honestly?The inclusion factor, Insider Quarterly article

Truly inclusive working cultures enable everyone in the organisation and drive the strategy, but if the culture is undermined by bias that restricts who or what we include it can severely affect safety and risk management.

Robin Ely, along with Debra Meyerson, highlighted the impact of inclusion on safety in their 15-year study of oil rigs (“Unmasking Manly Men”, July-August 2008 issue, Harvard Business Review). She identified how macho cultures exacerbated poor, often unconscious, decision-making contributing to safety issues.

Ely found that: “Men who work in dangerous places often act invulnerable to prove their merit as workers and as men – objectives that can lead to decreased safety and efficiency. In dangerous, male-dominated work settings, men’s tendency to gain respect by demonstrating and defending their masculinity is costly.”

The research revealed that macho cultures place high value on the need to prove oneself and a perception that revealing one’s weaknesses exposes incapability. The “macho” culture engendered an atmosphere that stifled speaking out, the ability to question or point out flawed decision-making and, worse still, the capacity to highlight hazards or accident risks.

Consider what this means in the insurance profession today. We have to ensure that the cultures we create differ from the “macho”-dominated ones of the past to ensure we hear from everyone. The very business of risk needs now, more than ever, to have input from not just the usual suspects.

Michael Bartholomeusz, chief risk officer at flood insurance pool Flood Re, concludes: “A strong organisational risk culture requires more than easily apparent dimensions of diversity based on factors such as gender, colour, age and professional background.

“Essential is a strong and deliberate ‘tone from the top’ which welcomes constructive dialogue with all employees about how the organisation is keeping true to its purpose and, crucially, how it behaves in doing that.”

As we continue to partner with insurance organisations across the globe, our top-line strategy rarely changes. There needs to be a deep realisation that it will be the organisation which creates an inclusive environment, where all individuals at every level of the business can be appreciated, respected and, above all, heard in order to help their, and the company’s, growth and development.

That change can only start with individual recognition of our own behaviours and biases, and leaders who take responsibility for building their own and then others’ awareness – supporting them and enabling a safe psychological space in which to thrive.

Angela Peacock is the chair of global diversity and inclusion training specialist at The People Development Team.

2017-11-27T13:16:09+00:00April 10th, 2017|PDT in the News|Comments Off on INSIDER QUARTERLY | The Inclusion Factor