With more than 300 locations in 48 states, Stanley Steemer is serious about cleaning—its services include everything from furniture cleaning to 24-hour emergency water restoration. CLM Fellow Eric Spalsbury explains how he and his department help keep its operations free from stains and sparkling like new.
Q. What does the career path that brought you to Stanley Steemer look like?
A. Before coming to Stanley Steemer, I spent some time as a contractor for the federal government; managed nuclear waste disposal and hazardous materials/waste transport; and supervised environmental, health, and safety in the chemical manufacturing and global distribution industries. It has been an interesting 30-plus-year journey.
Q. Do you employ enterprise risk management strategies at your company?
A. ERM concepts are at the heart of the support activities that we provide to ownership and operational management, but it is a subtle application. We have worked hard to establish a good working rapport with all of the internal functions with which we interact on daily basis. Managing operational and financial risks is a consideration that we have labored to instill into the foundational business acumen of the company. Likewise, we are constantly working toward improving our relationship with our external partnerships. Whether it is with an insurer, broker, TPA, medical management, or an investigational service, we communicate performance expectations and measure accordingly.
Quantifying change—either negative or positive—has been the key to closing the ERM circle for us. We convey our metrics to operations and external partners in terms of impact to profitability. While it may seem abstract or complex for some of the external partners, our risk management team has become adept at illustrating to our partners what effect their actions have on our business performance. Sometimes a partner does not “connect the dots” and a change has to be made. After all, it’s almost always our money on the table—if we don’t watch every cent, someone else will.
Q. What about risk transfer opportunities?
A. For us, operational connectivity is paramount. While placing coverages is still an important part of the risk management equation, it is more of a formulaic exercise that a broker well versed in your business risk appetites can help complete to satisfaction.
We believe a shift in primary focus to business design improvement and how we measure and interact at an operational level is the path to full integration. This has been achieved not only by spending a lot of time in the field, but also working closely with our operational management. We truly are an integrated part of the operational arm of the company—fully collaborative and nonconfrontational.
Q. Describe some of the risks you manage.
We focus on labor-related services, so the specter of injury is ever present and we strive to care for our people who are hurt on the job. Our potential catastrophic exposure comes from operating the fleet of vehicles we use to provide these services. Finally, we have a new initiative to address our property damage claims more efficiently, with improved customer service a designed byproduct.
Q. Have you ever taken a risk and turned it into an opportunity?
A. This usually takes the form of operational change. A recent risk management field reconnaissance identified a unique variation of a work process being used to service a special account’s needs, which resulted in the use of equipment and techniques that had a higher risk of injury associated with them. Claims statistics supported this and “red flagged” the practices. The varied approach identified in the field was captured and communicated back through operational improvement forums.
Operational change is always risky, but the altered practice was thoroughly vetted and validated. The outcome of the exercise was communicated to the entire network via formal procedure and training materials. As a result, we anticipate fewer employee injuries, reduced costs, and improved operational efficiencies. We will watch and measure the effectiveness of the change. It is a win that might have been missed had we not embedded ourselves in the operations.
Q. What kinds of claims do you typically encounter?
A. All I can say is that they range from the sublime to the ridiculous. We are working in hundreds of thousands of homes and businesses each year, and the risk variables run the gamut. Some are quite complex and genuine; others are so farfetched as to be comical, or worse, very serious.