Risk Management
12-30-2004, 11:17 AM
#1
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Risk Management
What is risk management?
As some of you may recall, some members of the AMA staff/leadership attended a seminar on risk management. Since that time, the term has emerged again and again. We now have people with a little knowledge trying to make risk management policy. Those people are relying on the opinions of others, including the Safety Committee, to determine risk. Ultimately, the Board of Directors (EC) determines risk management policy. I am not aware of as many as one person on the AMA staff or Board of Directors that could be classified as an expert in risk management. In other organizations, entire departments of paid professionals make such policy.
In the past, the AMA has transferred risk through the purchase of insurance. It appears that the rising cost of insurance has created concern, and other methods are being employed to reduce/mitigate risk. When one, or two people are trying to make the determination of unacceptable risk, the potential for personal prejudices comes into play. The question becomes: “what risk is unacceptable, and what risk should be transferred through insurance or other methods?”.
Is the cost of having a professional risk management department more, or less, than the cost of increased insurance? Should the responsibility for determination of risk be left in the hands of a few that are not well versed on the subject? Does the potential exist for errors in the process of defining and elimination of risk? What risks are acceptable/unacceptable and why?
Stanford University has a web page devoted to a short discussion of risk management. Since the AMA is also an educational organization, I thought it an interesting information source, although there are several orders of magnitude difference in the wealth of the organizations. Here is the link: http://www.stanford.edu/dept/Risk-Ma...deptinfo.shtml
”Risk management can be described as the culture, processes and organization that helps a business to evaluate risk, assess its potential impact and plan the appropriate action to take in order to avoid or control risk by the most economical means. It is not possible or desirable to eliminate all risks, the objective is to implement cost effective processes that reduce risks to an acceptable level, reject unacceptable risks, and transfer other risks through insurance and other means.” http://www.abbi.com.au/dira/abbi/abb...Mgt-Definition
In the past, the AMA has transferred risk through the purchase of insurance. It appears that the rising cost of insurance has created concern, and other methods are being employed to reduce/mitigate risk. When one, or two people are trying to make the determination of unacceptable risk, the potential for personal prejudices comes into play. The question becomes: “what risk is unacceptable, and what risk should be transferred through insurance or other methods?”.
Is the cost of having a professional risk management department more, or less, than the cost of increased insurance? Should the responsibility for determination of risk be left in the hands of a few that are not well versed on the subject? Does the potential exist for errors in the process of defining and elimination of risk? What risks are acceptable/unacceptable and why?
Stanford University has a web page devoted to a short discussion of risk management. Since the AMA is also an educational organization, I thought it an interesting information source, although there are several orders of magnitude difference in the wealth of the organizations. Here is the link: http://www.stanford.edu/dept/Risk-Ma...deptinfo.shtml
12-30-2004, 12:52 PM
#2
RE: Risk Management
In the past, the AMA has transferred risk through the purchase of insurance. It appears that the rising cost of insurance has created concern, and other methods are being employed to reduce/mitigate risk. When one, or two people are trying to make the determination of unacceptable risk, the potential for personal prejudices comes into play. The question becomes: “what risk is unacceptable, and what risk should be transferred through insurance or other methods?”.
1. Hiring a "name" Ex. Director and basically increasing the bureaucracy by another top-level paycheck and applicable benefits, since no change is made other than adding another warm body.
2. A declining membership as both clubs and individuals are tiring of the so called 'risk management' rules levied on what the vast majority consider a recreational activity for their enjoyment.
3. Publishing a commercial magazine that costs almost as much as the applicable liability insurance package and actually results in the loss of support from those other model aviation magazines that have to depend on free market economics for their survival.
4. Non-acceptances of model flying facilities in numerous areas of the constantly increasing population expansion or areas of potential for population increase.
5. Poorly organized AMA publicity of model aviation as an educational, technical, indoor hobby and outdoor sport and recreation.
There are definitely a number of other problems.
IMO, To H-ell with so called "Risk Management". What AMA offers as secondary liability insurance can be obtained. It is worth three times the current cost simply for the peace-of-mind by knowing that the numbskull next to you on the flightline can cover your expenses should he bust you up a bit.
It's far past time that the AMA EC forgot about pompous self illusion of being a *big business* and got down in the trenches with the reality of promotion of the hobby/sport of model aviation so Clubs can build flying sites and restore the membership to a solid increasing factor. Of course, the Clubs can initiate this by requiring all members to vote in AMA elections and to change out the current deadwood and self-illuminating individuals.
12-30-2004, 02:32 PM
#3
RE: Risk Management
Hoss,
I wonder if anyone has tried to get in touch with the new Executive Director yet? I've tried, but haven't received a response yet. I was told to give the guy a chance to get settled, but I really couldn't see what difference would it make one way or the other if I contacted him right away. I was hoping that he might be able to look out side of the box moreso than the previous E.D. But I won't hold my breath.
One gets the feeling that the powers that be at AMA headquarters really don't have any desire at to do things in a better way. It's as if they are quite satisfied with the status quo, being quite confident that our wonderful hobby/sport will survive and grow - essentially on it's own. As you have noted, we are much too quickly running out of time.
Take care,
CCR
http://www.kites.org/rc_instructors
I wonder if anyone has tried to get in touch with the new Executive Director yet? I've tried, but haven't received a response yet. I was told to give the guy a chance to get settled, but I really couldn't see what difference would it make one way or the other if I contacted him right away. I was hoping that he might be able to look out side of the box moreso than the previous E.D. But I won't hold my breath.
One gets the feeling that the powers that be at AMA headquarters really don't have any desire at to do things in a better way. It's as if they are quite satisfied with the status quo, being quite confident that our wonderful hobby/sport will survive and grow - essentially on it's own. As you have noted, we are much too quickly running out of time.
Take care,
CCR
http://www.kites.org/rc_instructors
12-30-2004, 04:27 PM
#4
RE: Risk Management
I worked in companies where it seems that the top managers will pay any amount of money to have an excuse to sit in a room, eat catered donutes and sandwiches, and not have to real work.
The AMA cheifs fit in that boat.
All "risk management" does if make some consultant rich and some manger feel all warm and fuzzy for a day of two.
Scott
The AMA cheifs fit in that boat.
All "risk management" does if make some consultant rich and some manger feel all warm and fuzzy for a day of two.
Scott
12-30-2004, 05:49 PM
#5
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RE: Risk Management
All "risk management" does if make some consultant rich and some manager feel all warm and fuzzy for a day of two.
12-31-2004, 06:12 PM
#6
RE: Risk Management
ORIGINAL: Hossfly
IMO, the application of the subject "Risk Management" is simply a camouflage within the AMA EC for the real problems the AMA faces. Examples are:
1. Hiring a "name" Ex. Director and basically increasing the bureaucracy by another top-level paycheck and applicable benefits, since no change is made other than adding another warm body.
2. A declining membership as both clubs and individuals are tiring of the so called 'risk management' rules levied on what the vast majority consider a recreational activity for their enjoyment.
3. Publishing a commercial magazine that costs almost as much as the applicable liability insurance package and actually results in the loss of support from those other model aviation magazines that have to depend on free market economics for their survival.
4. Non-acceptances of model flying facilities in numerous areas of the constantly increasing population expansion or areas of potential for population increase.
5. Poorly organized AMA publicity of model aviation as an educational, technical, indoor hobby and outdoor sport and recreation.
There are definitely a number of other problems.
IMO, To H-ell with so called "Risk Management". What AMA offers as secondary liability insurance can be obtained. It is worth three times the current cost simply for the peace-of-mind by knowing that the numbskull next to you on the flightline can cover your expenses should he bust you up a bit.
It's far past time that the AMA EC forgot about pompous self illusion of being a *big business* and got down in the trenches with the reality of promotion of the hobby/sport of model aviation so Clubs can build flying sites and restore the membership to a solid increasing factor. Of course, the Clubs can initiate this by requiring all members to vote in AMA elections and to change out the current deadwood and self-illuminating individuals.
In the past, the AMA has transferred risk through the purchase of insurance. It appears that the rising cost of insurance has created concern, and other methods are being employed to reduce/mitigate risk. When one, or two people are trying to make the determination of unacceptable risk, the potential for personal prejudices comes into play. The question becomes: “what risk is unacceptable, and what risk should be transferred through insurance or other methods?”.
1. Hiring a "name" Ex. Director and basically increasing the bureaucracy by another top-level paycheck and applicable benefits, since no change is made other than adding another warm body.
2. A declining membership as both clubs and individuals are tiring of the so called 'risk management' rules levied on what the vast majority consider a recreational activity for their enjoyment.
3. Publishing a commercial magazine that costs almost as much as the applicable liability insurance package and actually results in the loss of support from those other model aviation magazines that have to depend on free market economics for their survival.
4. Non-acceptances of model flying facilities in numerous areas of the constantly increasing population expansion or areas of potential for population increase.
5. Poorly organized AMA publicity of model aviation as an educational, technical, indoor hobby and outdoor sport and recreation.
There are definitely a number of other problems.
IMO, To H-ell with so called "Risk Management". What AMA offers as secondary liability insurance can be obtained. It is worth three times the current cost simply for the peace-of-mind by knowing that the numbskull next to you on the flightline can cover your expenses should he bust you up a bit.
It's far past time that the AMA EC forgot about pompous self illusion of being a *big business* and got down in the trenches with the reality of promotion of the hobby/sport of model aviation so Clubs can build flying sites and restore the membership to a solid increasing factor. Of course, the Clubs can initiate this by requiring all members to vote in AMA elections and to change out the current deadwood and self-illuminating individuals.
