In this throwback episode of The Power Producers Podcast, David Carothers and co-host Kyle Houck continue to discuss the total cost of risk. They talk about how companies utilize the total cost of risk and how they can relay it to their clients and prospects.
Episode Highlights:
- David shares his experience when he went to the National Alliance and received his CRM designation. (7:13)
- What’s the certification process look like? (7:33)
- David shares that one of the benefits of using the total cost of risk is that it helps people make informed risk management decisions. (7:58)
- David mentions that making informed risk management decisions doesn’t always mean that they are going to be good. (9:19)
- David shares a story about the Ford Pinto, where it became a massive hazard because of its design. (9:30)
- David mentions that if you know your total cost of risk, you can use it to benchmark your process and have something unquantifiable. (11:42)
- David shares that if you know your total cost of risk, you can help in promoting safety and risk management initiatives. (11:54)
- David mentions the book entitled Whale Done!, by Ken Blanchard. (15:43)
- Kyle thinks that people would respond to rewarding behavior, better than the negative reinforcement of it. (17:29)
- David mentions that everybody that is in manufacturing or some kind of a measurable service occupation has a metric for quality. (19:04)
- David shares that when you talk to operationally inclined people, they’re going to be able to point out not only how they measure quality, but also how they measure productivity. (19:39)
- Kyle mentions that the common answer to measuring safety is the number of injuries or frequency of injuries or claims. (20:11)
- David mentions that when he calculates the total cost of risk, he shows them how many days they have to operate in an assumed sales volume, and an assumed profit margin to cover that total cost of risk. (21:09)
Tweetable Quotes:
- “I’m a big fan of behavioral-based safety incentive plans. I want people to know that we’re going to reward them for doing the right things, and it’s not expensive, it’s far less expensive to put an incentive program in place when you reward the behaviors you want to see so that people replicate them.” – David Carothers
- “You give people attention, and you reward them for the behaviors that you want to see so they will replicate those. But don’t make a big deal about when they’re not giving you the right behavior and they’re doing the wrong thing, you just simply positively redirect them the way that you want them to go. Because subconsciously, your mind has to replicate those behaviors that get your attention.” – David Carothers
- “I think what that shows too is it’s not the overly technical stuff. We’re not getting deep in the weeds of insurance stuff. I mean, nothing really, that we’ve talked about has been even insurance-related other than we talked about the premiums, briefly because it’s a portion of the total cost of risk.” – Kyle Houck
- “You can tweak it and make it fit whoever you’re sitting there in front of. But I think this should help people with that conversation in breaking down what components are actually a part of the total cost of risk and how they’re going to impact that individual prospect.” – Kyle Houck
Resources Mentioned: