Inside Risk with Rose Kuba-Herbig, Dr Pepper Snapple Group
See how CLM Fellow Rose Kuba-Herbig keeps all of her company’s risks from fizzing over.
By Eric Gilkey
With a brand heritage spanning more than 200 years, Dr Pepper Snapple Group’s (DPSG) portfolio includes more than 50 brands and hundreds of flavors of carbonated soft drinks, juices, teas, mixers, waters, and other beverages. See how CLM Fellow Rose Kuba-Herbig keeps all the company’s risks from fizzing over.
Q. How did you find risk management?
A. I started my risk management work life when I was 10 years old by getting up in the mornings at 5:00am to help my dad move irrigation pipes in the fields. Much later on, I fell into the insurance industry purely by an “Oh that sounds like something I can do!” attitude, and I ended up working for one of the top brokers in the U.S. as vice president of claims and professional standards. After 11 years of working from a broker perspective, my experience led me to an opportunity at DPSG. My perspective as a client dealing with insurance, risk management, and claims management has been enlightened.
Q. What is your risk management philosophy?
A. A colleague once told me that having a risk management department in an organization is like having police officers sitting in every meeting of an organization’s quest to make sound business decisions. We often are viewed as the “naysayers,” the “doom and gloomers,” or the “better nots.” However, as anyone who is in risk management will tell you, we just want to ensure that the right thing is done and that, in doing so, our organization is protected in the event that there is a question about the veracity of our business. I believe that the true art of effective risk management is the ability to look at the whole picture, because the little details can come back and haunt you. Having a character of accountability coupled with effective communication is in the forefront of everything.
Q. How has your claims background aided you?
A. I have been an all-lines adjuster for over 10 years, and managing claims from a broker perspective for over 15 years. That background has made the transition into my current role a fairly smooth one. Having the carrier knowledge and working with several TPAs throughout my insurance career has made it easy for me to bring a value-add dimension to DPSG.
Q. What is your daily life like as a risk specialist?
A. Every day is a Monday, and I often think of Forrest Gump and his box of chocolates. Understanding the nature of the business helps me in the opening of the chocolate box and taking a bite into my day. There would be no claims if there was no risk—and there is no such thing as a risk-free business.
Q. Do you employ enterprise risk management strategies?
A. Because DPSG is a publicly traded company, we are required to maintain systems of internal controls, and management embraces the use of independent auditors to attest to the effectiveness of our systems. (We all are very much aware of the Sarbanes-Oxley Act of 2002.) Visual metrics are critical in our daily, weekly, and monthly evaluation of how effective we manage the costs of claims, which includes reporting, reserving, and closing files. This is one of the core objectives that is held in high regard amongst all who work on our team. As everyone knows, the direction that any organization takes in employing the principles of enterprise risk management strategies is all encompassed in the daily evaluation of the risks a company is willing to accept.
Q. Describe some of the risks you manage.
A. You would think being a company that manufactures, distributes, and transports products on a daily basis that our biggest exposure would come from our drivers traveling the highways, but it actually comes from work-related injuries in our daily operations. There are so many moving components in the food/beverage industry. We have a very robust environmental, health, and safety team that has enhanced our ability to identity these risks and initiate action plans to ensure the safety and well-being of our employees.
Q. Can you discuss a memorable claim?
A. There was a claim I handled when I was at the broker level, long before I came to work at DPSG, and it involved diapers. The fasteners didn’t stick or they would fall off completely. In understanding the claim, I learned how polymers mixing together could affect the binding of a material. There were several countries involved, including China and Germany, and we often had meetings that started at 5:00am with scientists and chemists. The calls usually involved about 15 people—a third of whom were interpreters. Several carriers were involved on this claim, and it took almost four years to settle with all of the parties.