Flashcards in Chapter 2 - Roles And Responsibilities Deck (107):
The emphasis in the financial services sector is on the delivery of soft services like insurance, accounting and banking. This is most commonly achieved by...
Relying on the interaction between the originations staff and its customers.
The main function of management in the financial services sector is to facilitate and sustain the positive interplay between:
-the organisation as a operate entity
-the external environment including employees, the general public, the government, shareholders and other stakeholders
Shareholders of a public company appoint... Who form a...
Directors who form a board
An important duty of the chairman is?
To ensure that meetings are run in an orderly and efficient manner.
The chairman is often the originations representative to...
The outside world
Under good corporate govnerance, the CEO and chairman are usually...
What are the two types of director and how do they differ?
-executive directors. These work full time and are given management responsibility for running parts of the business. The board usually appoints one of the executive directors to be accountable for the running of the company and is known as the chief executive officer or managing director who in turn appoints the company management
-non executive directors. Who work part time and are chosen for their particular area of expertise and do not perform an executive management role in the company. They attend board meetings and may be members of sub committees in order to provide independent views on matters such as audit, management remuneration and risk management
Someone who has director in their job title...
May not actually be appointed as a director
The responsibilities of boards will vary by company, but for insurance companies the main focus is...
Underwriting strategy, financial management, capital management, risk management and operational effectiveness.
The board of directors of a company is concerned with representing the broad interests of the ????????? And ???? In the company, but does not take an active part in the daily....
Shareholders and staff. Do not take part in daily running of the company.
The board concerns itself with the broad ..... Of the company.
Plans and policies
The board of directors will review past performance, make plans for the future, formulate policy to carry out those plans and will determine the firms strategy and ??????? Utilisation.
The board will be influenced strongly by the recommendations and reports it receives from...
Most boards are responsible for:
-overseeing the executive directors and other senior management to ensure they uphold the shareholder interests and the laws governing the conduct of business
-setting strategy, budget and other plans
-select, appraise and reward the CEO
-oversee risk management process
-ensure company's integrity is held in legal matters, regulatory, ethical and financial reporting etc.
In insurance, there are a number of trade associations, educational bodies and other organisations such as the...
Association of British insurers, British insurance brokers association and chartered insurance institute.
Although the ABI and CII for example have no shareholders or board of directors, they do operate in similar ways to financial service companies. The reason for this is that in place of shareholders or board of directors there are...
Councils, presidents, committees and sub committees, each with a chairman, which perform the function of non executive directors.
All members of the senior executive team would normally have ?????? ?????? To propose developments to the company's strategy for discussion at the board.
The board would normally prepare a document setting out which matters its reserves for itself and which it delegates to the ...
CEO and possibly other members of the senior executive team.
The link between the board and the mangement of the company is the...
The managing director, as well as being a director, is responsible for the business functions and...
Day to day activities of the company.
The FD sometimes referred to as the chief financial officer would normally be a member of the senior executive team and usually but not necessarily a...
Director of the company.
The finance director will assist in the economic capital model to determine...
The appropriate level of capital for the company to hold.
The finance director will assist in stress and scenario testing to determine...
The amount of extreme risk the company may be subject to
Proposals to the board on the form of capital to hold in addition to equity capital, such as subordinated debt will be the responsibility of ...
The finance director/ chief financial officer.
The appropriate level of dividend to pay to shareholders will be determined by...
Chief financial officer.
Making recommendations in the appropriate level of claims provisions to hold will be the role of...
Chief financial officer
Preparation of the statutory accounts of the company for approval by the board and shareholders will be the responsibility of...
Chief financial officer.
Making presentations to, and managing relationships with the investment analysts who prepare reports on the company's performance and holders of the company's debt will be the responsibility of...
Chief financial officer.
Preparation of the financial information required by the PRA and be one of the main contracts for the PRA will be...
Chief financial officer
Preparation of the management information such as leading indicators of financial performance for the executive team and the board will be the responsibility of...
Chief financial officer
Management of debt, cash flow, liquidity, treasury matters, investment portfolio, financial aspects of planning process, budgetary process, forecast process, preparing of reviews by rating agencies, preparation and planning of statutory external audit and management of reinsurance accounting process all responsibility of...
Chief financial officer
Finance directors or chief financial officers have many other responsibilities such as reinsurance strategy, training and risk management and also ?? Operations.
The companies act 2006 requires all public companies to have ????????????? Although a private company need not have one.
In the UK, chief actuary is a statutory appointment for...
Chief actuary will be responsible for...
-technical pricing of nee and existing products
-calculation of claims reserves
-calculation of risk based capital requirements
-assessment of investment risk for funds supporting technical reserves
In addition to the standard senior executive positions, a typical insurance company will have the following senior positions:
-chief risk officer
-head of internal audit
-head of human resources
-head of information technology
Management can be said to be the process of...
Planning, organising, leading and controlling the materiel financial and human resources of an organisation.
To be effective, the mangement process requires a combination of forward planning, clear communication and efficient execution. Above all it requires...
In order to nurture the interaction between the organisation, its employees and customers, financial service managers must carry out a series of actions. (Planning, organising, leading and controlling. That affect a range of business components (the products sold, I.e insurances in an insurance company, financial and human resources of the organisation.) these actions will take the business...
In regards to management, what is planning?
Continuous and repetitive process made up of many different phases. In management terms, the usual result of this process is an agreed general plan covering the use of physical resources, the allocation of responsibilities, timetables and budgets, with the aim of achieving clearly identified results.
In regards to management, what is organising?
Related to the planning process is organising materiel and human resources so that they are utilised to the full and help to achieve the aim of the business within an agreed time frame.
In regards to management, what is leading?
What differentiates managers from employees is that managers are expected to lead their team members. In hierarchy management structure, juniors are expected to follow the descisions of their superiors. In flatter structures, a consensus is used to help make choices. One of the most important aspects of leadership is accountability. This is the leaders acceptance of responsibility for the department, As a result of their own descions.
In regards to management, what is control?
Every plan needs to be controlled and it is the mangers role to monitor and evaluate its progress. There are several common methods of controlling management activities.
What are the physical resources of an organisation?
Includes all the assets used by the origination that are of the disposal of the business and can be used to help it to achieve its objectives. These include office space, IT telecoms, websites and perhaps vehicles.
What are financial resources?
Resources that constitute the funds that area available to managers of the business to allow it to carry out its day to day operations. These include cash, bank loans, share capital, And other financial instruments against which it can raise money.
What are human resources in an organisation?
The people who work for the company, permanent, temporary, full time or part time basis, working directly or indirectly for the company in an outsourced basis. The ability to manage people has become an increasingly important management skill. Especially in more democratic societies where people are use to having certain freedoms and rights that protect them from being exploited at work.
What makes insurance and other financial services different to manufacturing and other product services?
Insurance is an intangible product
Managers should structure and organise their teem to meet the needs of the job. They need to have regard for the size of an effective working unit, for defining jobs, for clarifying reporting relationships and for defining and clarifying ???????
Managers should make sure they clarify the accountabilities of junior staff. Members of staff need to know...
What they can and can't do
Managers need to members of staff are ?????? And ????????? And that individual strengths and skills are used for both their benefit and that of the business.
Trained and developed
Managers should establish a system of personal targets and a
performance and reward which emphasises the contribution that staff are making and the level of their achievement and seek to ... Them
Reward them accordingly
Managers should ensure that correct descions are taken at the right time. Authority to make descions must be delegated as far down an organisation as possible and whenever possible, staff should be ....
Consulted before a descion which affects them is taken
Managers should ?????????????regularly with their staff. They will organise ????????? so that they can brief staff regularly on what must be achieved and why. They need to establish a system whereby they can receive feedback for their team so that they understand their problems and their reactions to the requirements.
Communicate and meetings
A manager should be what for other employees?
A role model
Managers should establish a system which enables them to consul with representatives of their group on plans and objectives which affect the way they work and their...
Managers should take a positive attitude towards employee representation and participation. If their company recognises a particular group for negotiation purposes they should encourage people to join that group, to attend meetings and play a part as a...
Managers should consider how jobs can be designed to meet the needs of staff in order to maximise their contribution and allow for job...
Managers should establish a system for monitoring ...
Results and performance
Managers should maintain discipline and control through effective use of authority and by seeking to encourage cooperation and...
Managers should consider their responsibilities to society and the relationship between the work they control and the...
Community at large
Because businesses has become increasingly sophisticated as world economics have developed, so too has the practice of...
Managers now need to use new skills that fit changing working patterns, new technologies, scarcer staff resources and the gradual deregulation of domestic and international...
Managers must earn what off their team members and colleagues and through what?
Respect by developing inter personal skills and empathy with other staff.
Managers must not only focus on employees but also...
The customer and now their descions effect them.
Managers must have the key skill of multitasking, managers today include awareness of...
IT management, financial, accounting, human resources, sales and marketing, in addition to having a deeper knowledge of their own specialises areas
It is important for managers to understand the benefits of operating in other countries and ways of...
Entering new markets
Managers should be aware of new concepts as...
Management theory has become an academic discipline in its own right.
In regards to the roles of a manger, many companies will ...
Publish a document on their roles.
The aims of communication within an organisation are likely to include informing, instructing, persuading, negotiating, advising, challenging, motivating, training and involving ...
There is evidence that most employees want to know about their organisations...
Plans for the future as well as how they are performing in their job.
Many insurance organisations have recognised the need to encourage staff too...
Provide ideas and suggestions for improving business performance.
Any barriers associated with communication do not get in the way and reduce...
The effectiveness of messages that have to be delivered
What are the 9 barriers to effective communication?
1. The problem of size
2. Natural reserve, fear, lack of confidence
3. Knowledge is power
4. The language problem
5. The problem of time
7. The grapevine
8. Failure to recognise the need to tell
9. Inability to listen
What is the problem of size in regards to being a barrier to effective communication?
Where there are three or more levels in an organisation, a deliberately designed communication system becomes vital. The casual approach can only work in very small units and even then a systematic method is usually found to be more helpful.
What is the natural reserve/lack of confidence issue in regards to a barrier to effective communication?
British people above all are known to keep themselves to themselves. Many managers experience fear and believe it is better to say too little than too much.
What is the knowledge is power issue with regards to managers?
For some people the knowledge of confidential information makes them feel powerful. Withholding information may be perceived as a way of preserving status.
What is the language problem? In regards to being a barrier to effective communication?
People interpret things in different ways, so a explanation must be made especially when jargon is used.
What is the issue of time in regards to barriers to effective communication?
People are always busy, often sorting out the problems which caused the previous failure in communication. In times of change managers are very busy, but this is perhaps one of the most important exchanges of understanding.
What is the issue with training in regards to barriers to effective communication?
Many managers are inadequately equipped with and uncassotmed to using organised methods of information flow. Moreover, many do not even know that it is an essential part of their duties to be skilled, however simply, in the exchange of understanding, including feedback.
What is the issue of the grapevine in regards to barriers to effective communication?
This form of communication as well as rumours can be very damaging and reinforces the need to control communication, and ensure all staff are advised of major developments or changes at the same time.
What is the issue with the failure to recognise the need to tell?
Common cause of breakdown in communications.
What is the issue of inability to listen in regards to being a barrier to effective communication?
Often mangers incorrectly deduce that to communicate means giving or sharing information. It is worth emphasising that to be effective, communication needs to Be a two way process. Active listening and consultation with staff is just as important.
Supervisors and team leaders are the what type of managers?
Supervisors and team leaders will need to have the skills of a Manager but will be directly interacting with...
Members of their team.
Supervisors need to be all about the team, highly customer focused and a good...
Role model for the team.
Dr ???? ?????? Provides a useful explanation of a team leaders role through his ????? ?????? ???????? Approach, which is today widely used as a model for leadership effectiveness.
John Adair. Action entered leadership.
In Dr John addairs action centred leadership approach, the three key identified areas of leaders effectiveness are...
- the task, the primary need to get the job done
-the team, the need to build a cohesive unified team, a bunch of star players does not always equate to a team
-the individual, we all have a variety of needs which motivate us into action to satisfy them, to be wanted, to be useful, to have our way. If these needs are not met, we become frustrated, and this affects our performance.
In regards to individual needs, a leader should...
-agree individual objectives
-attend to any personal problems
-give praise and reward to individuals
-train and develop individuals
-recognise and use individual abilities
In regards to task needs, a leader should?
-define the teams goals and objectives
-ensure the appropriate resources are available
-develop work plans and define team tasks
-allocate the work and resources
-control the work rate and quality
-check performance against plans
-adjust the plans as necessary
In regards to team needs, a leader should...
-set and agree standards and maintain discipline
-build and maintain team spirit and morale
-encourage, motivate, and give a sense of purpose
-ensure communication with the team
-appoint sub leaders
-train and develop the team
Explain how the scenario affects the other areas of leadership, high team spirit...
Affects individuals and can help achieve tasks
Explain how this scenario can impact the other areas of leadership, disgruntled individual....
Can reduce team cohesion and influence the achievement of the task
Each individual manager will have their own style of working and managing, the business will have an overriding corporate culture that is strongly influenced by personal values and mangement style of its...
Chief executive, senior partner or founder.
The issue of corporate culture is important because although management involves the effective use of an organisations physical assets, it is mostly concerned with...
The effective deployment and supervision of its people
Corporate culture relates to a a organisations day to day business in a certain way. The corporate culture is made up of three factors...
2. Beliefs and values
3. Management style
In regards to corporate culture, what are norms?
The behaviour which is most acceptable to an organisation. For example, approaches to problem solving, timekeeping, the way meetings are run, the use of first names, dress standards and standards of performance.
In regards to corporate culture, what are beliefs and values?
For example, "we stand for equality, the input of every employee is valued" "we do not test on animals"
In regards to corporate culture, what are management styles?
The behaviour of the managers, e.g open door, autocratic, paternalistic, militaristic/hierarchal, democratic/consultive.
The way in which new staff members are intergratrd into the organisation through the process of socialisation is an important part of...
Forming and maintains the corporate culture
Explain the different management styles
Open door - mamagers are approachable by staff at all times
Autocratic - control and power rest with a single individual, usually the chief executive
Paternalistic - the company looks after its employees in a fatherly way, and the employees respect the organisations managers in a way that children respect their parents, this style is sometimes perceived as too Inerfeering
Militaristic/hierarchal - the management Is structured in a formal way, with a clear job demarcation
Democratic/consultive - descisions are taken with prior reference to as many staff members as possible
Some styles of management are more appropriate than others in given situations. The most effective style in each case will depend on the type of business and current stage of the businesses life, that is whether it is expanding, contracting or...
In a time of crisis, which management style is appropriate?
Militaristic and focused on getting the job done, because not bothered about feelings really but getting the task done.
If the company is doing well, and wants to encourage more ideas, the type of management is...
Democratic, participative and tolerant.
On the basis that no manager can possibly know all there is to know about running a business, specialist technical and operational roles exist where the job holder is in an advisory relationship to line management they do not have necessarily full authority to convert recommendations into actions and are supervised by ...
Their line manager
Examples of technical staff in insurance include...
Company secretary, trainee actuary, risk analyst, solicitor, claims adjuster and accounts assistant.
All organisations require a number of supportive of amdisnitrative roles to ensure...
The effective and smooth operation of business.