Much success has been witnessed in the insurance industry ever since the formal implementation of enterprise risk management (ERM). ERM was first utilized as a risk management strategy to address future events in finance, operations, compliance risk, etc. Recently, it has included new target areas such as customer service, ethics and talent risk management.
Human capital risk management is becoming more prominent as executives are becoming increasingly aware of the existing talent gap. The talent pool has receded as Baby Boomers in the workforce are slowly giving way to Generation X, taking with them valuable knowledge as they leave their executive leadership positions.
If this issue is not taken into account by the risk management strategy, it will in turn reflect on the general business results. Senior executives may not rank as the single biggest risk within the industry, but their absence will surely have a domino effect on businesses if the acumen they have goes with them once they retire.
Bringing the Talent Tide Back
Employee engagement, mentorship of emerging talent, career development and training, and succession planning are key to mitigating the emerging talent risk. ERM coordinates all four strategies in a manner that holistically and effectively employs talent management.