Last week we held our Modern Actuarial Challenges Open Forum
About two dozen actuaries participated, sharing concerns and challenges, and receiving feedback from their peers on how to address those challenges.
We discussed Slope’s view of 13 “Modern Actuarial Challenges” and polled the audience. The top 3 from their point of view? Ancient tools – or none at all, Volumes of data available & corresponding analytic tools, and Too busy.
We then opened up the floor to specific questions. One participant revisited the idea of being “too busy”. His team spends all their time just getting the numbers completed, so they don’t have a good opportunity to understand and analyze them. Another participant suggested making small steps and small improvements. We also heard advice around how to make this more visible to managers. That is, if you can, make it more about them. When it’s their problem, they’ll have a vested interest in solving it.
We had some conversation about “just doing without knowing why”. There was a big desire from the group for more conversation and training of junior-level actuaries from the higher levels, not just on “what” to do, but “why” to do it. This lack of training seems to be highly correlated with the too busy mindset.
Then we discussed some requirements for what a tool (actuarial software or, frankly, any tool) should have. For actuarial models, users want the flexibility to manage it how they want, with the ability to layer on restrictions where they want as well. Most systems end up becoming “a large mess to maintain”. There ends up being a lot of time managing and maintaining models.
Better training would be helpful. Crystal-clear user guides on how to get introduced to software should be the minimum, which can give the user a solid base of understanding. Then the specific company can train individual users on their unique products and how they differ from standard. That way the new user doesn’t confuse the platform with the company’s customization (however that looks).
So what does that mean?
Well, it sounds like it means people have some priorities that need to get re-worked.
If you’re so busy that you can’t take the time to stop and rework your processes so they don’t take so long in the future, how are you ever going to have processes that don’t take so long? If you’re “too busy” to train the next generation of professionals, aren’t they going to go somewhere else that actually guides them on how to think? If you’re “too busy” just getting work done each quarter-end to stop and document what you’ve done, how is that going to improve next quarter-end when you have even more changes to explain?
So that idea of being “too busy” is a deceptively simple concept. You can use it to explain why you don’t have a better solution right now, but that’s not going to solve the problem. And in fact, it’s not even the real reason. The real reason is that you haven’t invested in improving those processes. Because you’re focused on short-term tasks instead of long-term strategies.
Fix that mindset, and you’ll begin to pursue (and achieve!) perpetual improvement.
If you’d like to participate next time, look for another open forum in January. Cheers!
Until then, be well, and do good work.
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- Steps to Effective Actuarial Model Conversion (series)
- A Model Optimization Hierarchy
- How SaaS Helps Actuaries (series)