Inside Risk with Susan Hiteshew
Under Armour's insurance and risk management analyst discusses how she protects her "house."
By Eric Gilkey
“Protect this house,” was a popular and award-winning marketing message for Under Armour, but it’s also a mantra that Susan Hiteshew takes quite literally as insurance and risk management analyst for the company. The CLM Fellow discusses the risks the company faces, the importance of a holistic approach, and the role predictive analytics play in planning for the future.
Q. How did you arrive in your position at Under Armour?
I joined Under Armour a year and a half ago after several years of working on the carrier side managing environmental and toxic tort claims. My career on the carrier side gave me a comprehensive background in insurance basics and helped me learn how to structure coverages. While I was on the carrier side, I began my MBA with a finance concentration, focusing on risk management classes. The hope was that I would soon be able to transition to the policyholder side.
Prior to joining UA’s risk management team, I knew insurance had been a segmented function that was managed collaboratively by several teams. I was hired in a newly created position and tasked with building a cohesive program for the company with a global scope, in addition to managing all claims. Our insurance program is a strategic piece of our risk management team, and, as such, I spend a lot of my time on enterprise risk management projects.
Q. What is the company’s overall philosophy on risk management?
We employ a holistic approach to risk management and assess risks by looking at multiple impacts (financial, operational, brand, and regulatory), as well as likelihood and velocity. We then identify and implement risk mitigating solutions that can reduce the likelihood of surprises, claims, or other unknowns from materializing. We present our collective quarterly risk reports to our Enterprise Risk Committee, which reviews and discusses the conclusions we have developed. Our ERC also helps us to identify particular areas in the company that we should assess and provides us objective feedback on the work we’ve done.
Q. What is your day-to-day life like?
My day-to-day responsibilities vary with the pace of growth and change at UA. A typical day for me will include everything from a meeting with a production manager on insuring wolves for a photo shoot to budget and risk strategy meetings, as well as late-night conference calls with our offices in Asia.
One of my priorities with our insurance program is to build bridges to all branches of the company to publicize internally how insurance and risk management can be a helpful tool for managers to get their jobs done in a more efficient and cost-effective manner. Opening the lines of communication allows me to provide risk consulting to managers who are reviewing new ventures, which helps promote the culture of risk awareness that we are driving towards internally.
Q. Describe some of the risks you manage.
We push to provide our customers with the most innovative products available to help them perform at their best, so our brand reputation and product integrity are our most significant assets. That makes them our biggest risks. Another significant risk is our age—Under Armour was founded in 1996 and has grown aggressively since its inception. As a part of our ERM team, I focus on building the appropriate structure and processes to support this growth today and to scale with the growth we expect in the future.
Q. What kinds of claims do you typically encounter?
We have typical workers’ compensation claims as well as the occasional slip-and-fall claims stemming from our retail network of 110 stores in the U.S. We also have had product claims. In those rare instances, we do a complete investigation on the product allegedly at issue to determine what could have happened, how we can remediate the issue, and restore the customer’s faith in our brand.
Q. What role, if any, do predictive analytics play in managing risk?
Predictive analytics play a significant role in our risk management philosophy, particularly with respect to how we structure the insurance program. We are constantly evaluating the structure of our insurance program and other risk management mechanisms to quantify the value that they bring to the company. We leverage predictive analytics to understand where our program is going, based on exposures and loss histories, to help us chart the course for the future. We’re a high-growth company, and we move quickly. One of the constant challenges I face is making sure we’re prepared to support the business in whatever new growth pattern we begin, and predictive analytics help us prepare for future expansion and growth.