Showing posts with label ivory tower. Show all posts
Showing posts with label ivory tower. Show all posts

Jul 27, 2010

What kind of actuary are you?

We all know plain actuarial skills are not enough to be(come) a successful professional actuary.

Time and time again we have to conclude that it takes more than average communication skills to overcome the persistent communication gap between actuaries and their audience.

In a 2008 workshop Matthias Bonikowski (Senior Manager at Milliman) presented the outcome of a German survey.

Here are the stunning results:
Proposition Actuaries' opinionNon-Actuaries' opinion
1.Actuaries are pessimists85%85%
2.Actuaries are not opportunists70% 70%
3.Actuaries communicate clearly and transparently 15% 5%
4.Actuaries think out of the box50%15%
5.Actuaries live in an ivory tower10% 50%

The Copy Paste Actuary
From the Bonikowski survey it's clear that non-actuaries (including: board managers, sales directors, product managers, coaches and headhunters) don't speak highly of actuaries.

It looks like most of the 'actuary species' are perceived as a kind of 'Copy Paste Actuary'. One who's not able to think out of the box.

We are congenital pessimists, trained to do a sort of one trick pony act. An act we can't explain or communicate, like 'normal' people seem to be able to do. 

On top of this  - just like the famous Baron Münchhausen who was unable to escape from a swamp by pulling himself up by his own hair - we actuarial poor devils seem unable to lift ourselves to the next level.

We're obviously trapped in our 'non-communication' addiction, smoke gets in our eyes and nobody around us seems capable of helping us to move from our alien planet to the world of real people, business and social life.

The non-actuaries' view in Bonikowski's survey emphasizes this image...

The non-actuaries' view
The non actuaries' view on actuaries comes down to::
- They explain complex terms as complex as possible
- Inability to make actuarial things clear to non-actuaries
- They are not able to take a bird‘s eye view
- They are missing empathy for non-actuaries

As possible reasons for this view, non-actuaries notice:
- They are isolated from decision processes…
- High expectations about actuarial knowledge – deep and broad
- Communication skills are not a part of actuarial education

As a 'solution', 7 suggestions for successful communication are developed:
  1. Point out key messages
  2. Leave out details
  3. Use more pictures and examples
  4. Explain more in “black and white”
  5. Avoid academic language/technical jargon
  6. Pick up non-actuaries earlier
  7. Define target-group specific communication rules

As we all know, these issues and solutions are not really new or surprising. Why is this issue of non-communication and 'Ivory Tower Effect' so hard to solve?

Actuaries are invisible
In 'My Opinion' of the Actuarial Review 2010, Grover Edie shows that we 'actuaries' are not in any way involved in important (political) decisions.

Important decisions that society has to take in coping with challenges as aging, longevity, health, etc.  Grover Edie explicates: 'they don’t ask us (actuaries) because we are not visible'.

My view is that the 'invisibility of  actuaries' is more or less a global issue.

Undoubtedly this theme of invisibility finds his roots in the actuary's attitude. This is well illustrated by Grover Edie's summarized reactions of actuaries on the issue:
  • “If I do good work, others will ask me for more of it.”
  • “I don’t need to advertise or to sell my work: My work speaks for itself.”
  • “I certainly don’t need to sell others on the value of my work, and if they are too stupid to know the value of what I do, that’s their problem.”

Supply and Demand
Grover Edie thinks that this underlying 'laissez-faire  attitude' is the basic problem. A problem that - in his view - can be solved with a simple sales training approach.  With all due respect...., the invisibility of actuaries has probably a deeper cause than this superficial laissez faire attitude only, that is mainly the effect of the Law of Supply and Demand.

Most actuaries had to study hard to achieve their goal of becoming a qualified actuary. Once they'd become an actuary, there was, still is and will be, more than enough well paid work. In other words: The Demand side of the market market exceeds (by far) the Supply side of the market. Why should actuaries develop a commercial sales attitude if they don't need it?

In this situation the risk that an actuary eventually becomes a 'Mirror Actuary', is not inconceivable.

A mirror actuary, one who just reflects and gives back what the environment offers him.

He looks a bit like the invisible actuary. Without a real own opinion,  the mirror actuary just reflects the financial impact and consequences of decisions taken by others.  He  acts without sincere social engagement or conviction. Hence he's unable to generate a critical positive feedback viewpoint, necessary to make what its takes, the difference.

What does it takes?
Convincing actuaries to become more visible and socially or publically involved, takes more than a professional sales approach. Actuaries have to be made conscious of why and where they are and what they really want to achieve in life.
In other words:

What kind of actuary would you (really) like to be?

In this case the answer is not a traditional one like 'Pricing Actuary', 'Pension Actuary', 'Health Actuary; or the humorous answer 'very kind'. No, the answer to this question hits our actuarial soul....

The good old actuarial horse
Would you like to be the well paid 'actuarial horse' in front of the wagon, that gets his orders from the coachman and does his calculation work every time he's being asked to do deliver some?
Or do you want to sit on the wagon, next to the coachman, discussing and advising on the best route of the wagon?

Answering these simple questions is key in solving the persisting actuarial mind setting issue.

Visibility? Select at the gate!
This invisibility issue deals with the fundamental structure of an actuary's personality.  It's not something that can be easily learned or changed during or after achieving a (long term) study. If we want visible actuaries who are socially and publically involved, we'll have to select them on that attitude at the gate, before they undertake an actuarial study. Just like we test their arithmetic talent and other mental capacities, before actuaries start their study.

The Dancing Actuary

If we don't act upon this new 'visibility insight' and keep trying to beat the famous dead horse, things will never change.

In this situation there's a tricky risk that we enjoy our salary and comfortable position so much that we suppress our critical view and potential power to change things. In which case we become totally dependable on our monthly paycheck and the opinion of our boss or manager.

In doing so, we might gradually become implicitly susceptible to extortion and eventually things will escalate.

Ultimately in this situation, we could even develop to a kind of 'dancing bear', in this case a 'Dancing Actuary'.

Try to keep your eyes open. If you feel completely 'chained' or if our environment constantly forces you to support actions or decisions you can not really account for, seek help or step out before it's too late.

The Wise Actuary
Wrapping up this warning blog about invisibility, you could get the wrong impression that black swan actuaries doe not exist at all.

Of course we know better. There are lots of wise and visible actuaries around the world and as you've made your way to the end of this blog, you'll be probably one of them....

Wise actuarial owls that want to make the difference in life and society. Actuaries who are not for sale and who know their personal limits. Actuaries that know when and where to say 'no' or 'yes'.

Actuaries that don't just want to talk about a better world, but want to act(uary) on it.

Are you that 'wise actuary', who's visible, socially active and leading society to the next level?

If you want to find out if you're a wise, invisible, mirror or dancing actuary, take the next 5 minutes 15 questions test called:

Good luck with this 'actuary stress test'!

Related links/ Resources:
- Workshop Actuarial Communication (2008) Presentation (pdf)
- Article: They Don’t Ask Us Because We Are Not Visible
- Test:What kind of actuary are you?