Monthly Archives: January 2012

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Wyoming: Work at Your Own Risk

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Wyoming’s decades-long oil and gas boom has drawn thousands of people to the state for high-paying — but dangerous — jobs.

It was the alarmingly high rate of fatal on-the-job accidents that prompted former Governor Dave Freudenthal to put together the Workplace Safety Task Force consisting of members from the major industries in Wyoming as well as several state agencies. The task force hired Dr. Timothy Ryan, an occupation epidemiologist, to look into the problem and provide possible solutions.

In analyzing 17 years of occupation fatality data (1992-2008), Dr. Ryan found that:

The common theme throughout is the lack of a “culture of safety” in Wyoming. The following is a summation of what the employees described as their typical work environment:

  • There is a breakdown in communication between the upper management, supervisors, and employees regarding safety.
  • “Often the safety training that we receive is not enforced on the work site.
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    ”

  • Employees are told to “get the job done” and safety protocol and rules are not enforced, resulting in injuries and fatalities.
  • On any one job site, there can be a wide range in the safety standards.

In what can only be termed “shocking,” the report claims that based on the total number of fatalities, Wyoming averaged a fatality “every 10 days of the last 10 years.”

As the statistics indicate, the state of Wyoming is in dire need of solution to this problem. Dr. Ryan suggested the following:

  1. Organize and develop continuity of ongoing efforts.
  2. Develop data monitoring system for the collection and timely analysis of occupational data.
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  3. Promote OSHA courtesy inspections.
  4. Support efforts by industry to develop, monitor and enforce safety standards and practices.

The implementation of these suggestions will hopefully take Wyoming off the list of “most dangerous states to work.”

Foxconn Workers Threaten Suicide

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Foxconn, China’s mega-manufacturing plant that supplies parts for Apple iPhones and Microsoft xboxes, is receiving more bad press for the alleged suicide pact that several of its employees were a part of this week.

Last year I wrote about a rise in workplace suicide at Foxconn, where 920,000 people live and work. In 2010, 11 employees had chosen death over working at electronics parts manufacturer, most of them jumping from the top of the highrise dormitories that house the workers. As the story goes:

This is not the first time the company’s worker conditions have come under scrutiny. In June 2006, the London Daily Mail published a story detailing the harsh conditions for the 30,000 employees at Foxconn’s Longhua iPod factory. Seeing a possible major reputation disaster looming, Apple dispatched several executives to investigate conditions at the plant. They issued a report detailing numerous violations of Apple’s supplier code of conduct.

Apple came under fire after these reports and reportedly made changes regarding the labor rules for the departments of Foxconn responsible for manufacturing Apple products. And now conditions at Foxconn are putting one of Apple’s biggest competitors in the spotlight.

Yesterday, dozens of Microsoft Xbox workers climed to the roof of one of the many dormitories on the Foxconn “campus” where they threatened to jump in a dispute over job transfers.

The dispute was set off after contract manufacturer Foxconn Technology Group announced it would close the assembly line for Microsoft Corp.’s Xbox 360 models at its plant in the central city of Wuhan and transfer the workers to other jobs, workers and Foxconn said Thursday.

Workers reached by telephone said Foxconn initially offered severance pay for those who wanted to leave rather than be transferred, but then reneged, angering the workers; Foxconn, in a statement, disputed that account, saying only transfers were offered, not severance.

Though Foxconn has apparently resolved the issues peacefully, 45 employees have resigned.

This is just another one for the infamous Foxconn record, a place that, for years, has received negative press for its harsh working conditions and low pay for employees. But as anyone in business knows, that negative press trickles down to its clients: Apple, Microsoft and Hewlett Packard. For these tech giants, its a reputational nightmare that will continue to make headlines unless more is done — and soon.

5 Property/Casualty Insurer Goals for 2012

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Ernst & Young offers its advice to insurers that want to succeed in the year ahead.

Execute flexible approaches to manage uncertain conditions. To implement fluid strategies in an environment of multiple uncertainties, an insurer’s operational capabilities, infrastructure and corporate culture must support flexible, rapid and well-governed decision-making, thereby assuring agile performance with accountability. Diligent monitoring of changes in loss exposures and loss development drivers will guide flexible adjustments to risk management and risk pricing.

Anticipate, understand and address the impact of prospective regulations. Insurers must assess the impact of new regulations and accounting changes prior to implementation. They should consider enhancing the sophistication, articulation and deployment of their risk management standards and related systems, as compared to their current regulatory and reporting environments.  E&Y states that those insurers who fail to understand the full impact of regulations and new accounting standards may lose competitive advantage.

Comprehend and act upon changing insurance buying behaviors. Gaining a clear understanding of the customer will improve the chances of marketing success, notes E&Y. The buying behaviors and risk profiles of tomorrow’s customers will likely bear little resemblance to those today. Identifying, assessing and capitalizing on the characteristics of tomorrow’s customers underscores the need to tailor products, services and distribution channels to their specialized needs, notes the report.

Increase investments in core systems to bolster growth and profitability.  Insurers face mounting pressures to modernize core insurance systems such as claims, policy administration, underwriting and billing. Competitors have set the stage for this need for improvement, along with heightened customer expectations and, above all, increasing costs to maintain and upgrade systems. “Faced with limited investment alternatives yielding an attractive return, insurers are investing in themselves to position their operations for growth and improved profitability,” notes the firm.

Apply business analytics to address difficult top-line growth conditions. E&Y states that an uncertain economic environment will force insurers to apply business analytics across the value chain can glean deeper information on customer markets, underwriting segment profitability and claims management. Insights gained from analytics can then guide both strategy development and improved decision making, notes the firm.