In The Trade Credit Insurance Industry hence: “Those who can, better teach.”

By Rob Downey

Who among us has not heard a small-minded triumphalist say, in extolling their personal merits after some passing victory, “Those who can, DO; those who cannot, TEACH.”?  When I had time for it, I used to say in correction, ”Those who can, TEACH; those who cannot, needed BETTER TEACHERS at some point along the way.”

Now more than ever, those who CAN had better TEACH!  Almost everything we used to know for sure about credit, credit insurance and trade finance is changing; almost everything we used to be able to safely take for granted – from rating agency competence to sovereign stability to reserve requirements – has been challenged or destroyed wholesale.  The teachers within your company should be encouraged and brought to the fore.  This is their season again; comes ‘round their hour anew.

After surviving the most severe and widespread recession since 1929, we will all have to start again, even if we do not have to start over from scratch.  Let us begin with teaching our company teams the new rules governing international trade, credit insurance and markets.  In the most severe cases, let us not ignore the need to rebuild our decimated teams entire – and in that process teach new ways of approaching tasks – as if we believe that teaching is fundamental to successful teamwork. 

Those involved in trade credit insurance have new content to master and a new reality to face. We – insurers, insureds, lenders, buyers, sellers – need to learn the new rules, tools, products, ratios and relationships.  Whatever the content and procedural details of your particular situation, the new “order” has to be taught to everyone on your company team and within the ambit of your partnerships and alliances.

Good teaching, in my experience, is still comprised of five aspects.  From the teacher’s perspective, they are: 1.  topical expertise and experience; 2.  energy, durability and interest;  3.  audience empathy and sensitivity to the students’ receptivity;   4.  creativity in the methods of presenting, repeating and emphasizing material; and,  5.  the spiraling use of increasingly complex metaphors, parables, tropes, memes, and comparisons – from within or without the specified topic – that build upon concepts well understood by a target audience.  

For the credit management, risk management and credit insurance syllabus there are at least ten new chapters, i.e., trends that began or accelerated during the global downturn and its concomitant retrenchment:

• Teams are smaller because of cutbacks or non-replacement, whether cuts were appropriate and well-executed or not
• Teams are more important than “stars” as the need is for new combinations of knowledge, experience, skill, and speed
• “Glocal” teams result from the need for global integration with intense local focus/feedback
• E-communication/presentation tools, e.g., webinars, Skype, are here to stay but need to adapt to “glocalization”
• Cost of risk and risk mitigation tools is up and will remain high for years
• Customers willing to pay these higher prices want more durable, even “non-cancelable”, protection
• Customers with non-cancelable coverage more frequently want to borrow against their insured A/R assets
• Providers are more frequently being asked to cooperate in syndications with other providers on large limit requests
• Companies now understand benefits of insured limit on themselves to secure favorable purchasing terms from suppliers
• Government programs – outside western democracies – are filling part of the coverage gap in a demanding market

Marva Collins was an educator who in 1975 started Westside Prep School in Garfield Park, an impoverished neighborhood of Chicago.   She was played by Cicely Tyson in the 1981 TV movie made of her life.  She said of teaching, “Everything works if the teacher does.”  So it is with adjusting to a coming decade that will bear little resemblance to the previous decade.  It is not enough to rest and recover while we wait for the staus quo ante to reassert itself.  We need to learn the future as it becomes true – in the trade credit insurance industry as in others.  For everything we need to learn, we need to either find a teacher or teach ourselves.  Everything in that sometimes painful, often disconcerting and occasionally frightening re-ordering process will work, if we work hard on our teaching.

(Rob Downey is one of the founding partners of International Risk Consultants, Inc. (IRC) www.irc-group.com – a globally-integrated trade-finance and credit insurance specialty brokerage, which serves as the operating member of ICBA for Asia, Brazil, India and the USA)