For those among us lucky enough that our days of taking examinations are little more now than a blissfully faded memory, the sight of so many young people receiving their academic results over the last two weeks has likely stirred sensations of sympathy and reprieve in near equal measure.
And results have been in the insurance world news a lot lately too, between the half-year updates on the trading results of insurance businesses and reports into the performance of the wider industry. But whether you’re talking about the series of letters that are the culmination of years in education, or the rows of numbers that represent the relative success of a chosen strategic direction, there’s a shared wind-down to all results – the dreaded post-mortem.
That fervent picking apart of what each figure means, where it came from and what its implications are for the future is a well-worn ritual, started in childhood and borne cheerlessly into adulthood. The problem with the autopsying of the way things are is the open invitation it offers to considering what might have been and what ought to have been – twin considerations that hold little water when dealing with absolutes.
There is, of course, value to be found in critiquing results but all too often it’s a time-consuming affair that yields fewer insights than might be expected for the time invested in its practice. And so, it was with an open mind to the suggestion of a substitute that I recently came across the suggestion of an alternative tradition – a managerial strategy known as a pre-mortem.
Seemingly coined by the research psychologist Gary Klein, a pre-mortem sees team members “assume that the project they are planning has just failed—as so many do—and then generate plausible reasons for its demise”. In doing so, those with misgivings are able to voice them at the outset of a project in a bid to future-proof its success.
I confess I was initially quite dubious about the wisdom of engaging in such an enterprise – it struck me not so much as putting the cart before the horse as resigning the horse to the pasture and the cart to firewood before you’ve actually looked at either. But the more you dig into the mechanics of the strategy, the more sense it makes, particularly with respect to the insurance profession.
By its very nature, insurance needs to be forward-looking. The ambition to future-proof businesses is embedded in the very DNA of risk management. In a recent interview, Marsh’s James Crask highlighted that without a focus on resilience measures, the ability to proactively mitigate effective business continuity measures is throttled.
Between Brexit, COVID, the cost-of-living crisis, rising energy bills and the ongoing conflict in Ukraine, there is no shortage of wolves at the door and it’s understandable that so many businesses are deploying the tried and tested recourse of worrying about tomorrow, tomorrow. But the reality is that most businesses have never faced such a maelstrom of combined economic, social and political factors hitting at the same time.
Tomorrow is being written by today, and today is looking increasingly uncertain. Insurance businesses are in the unenviable position of having to share that message and create the resilience structures that when put in place might mitigate its worst excesses. True resilience requires a Janus-esque approach to risk – where the eye fixed on the present and the eye fixed on the future are sharing what they’re seeing and finding those patterns that inextricably link that vision.
Right now is the best time for businesses to be evaluating the likely success of the strategies, measures and procedures they’re putting in place to weather the storms they’re facing. The insurance profession needs to communicate that far more important than the question of ‘where are we now?’ is asking ‘where we will be in 12 months?’
And no pre-mortem investigation is going to be perfect, or even necessarily accurate, given how rapidly our PESTLE environment is shifting. It’s a sad indictment of the times that we’re all living through but there really is no time like the present to worry about the future. But a retrospective examination will simply come too late – and ‘too late’ is not a fair or fitting epigraph for the businesses that make up our communities and economy.
