For someone in such a high-profile position, Klas Iloson is a remarkably calm person. That's because, as managing director, group risk management, for SKF Reinsurance AB, Iloson is confident that the mitigation measures in place at the more than 100 manufacturing facilities under his purview are backed by proven engineering principles.
Based in Gothenburg, Sweden, SKF Reinsurance AB is responsible for all insurance issues and loss prevention work within its parent company SKF AB. SKF AB is a leading global supplier of rolling bearings, seals, mechatronics and lubrication systems and services, and is powered by 46,000 employees in 32 countries.
Iloson earned a master's degree in law from Uppsala University in Sweden. He began his career with SKF in 1994 in finance and treasury before venturing into risk management. Throughout the years, he's held various roles within the company, including five years as managing director of SKF Treasury Centre Asia. In 2008, Iloson began his current role, where he continues to focus on building the foundation for SKF's future business continuity efforts.
"I believe that open communication and an unwavering commitment to understanding and documenting all of our risk leads to minimal losses."Klas Iloson, managing director of group risk management, SKF Reinsurance AB
What do you do as a managing director?
My responsibilities include overseeing our parent company's extensive worldwide insurance programs, assisting senior management in evaluating and developing appropriate risk profiles, interacting with business sectors to facilitate a better understanding of mitigation possibilities and costs of various risks associated with business and strategic development, and assisting in achieving a proper balance between risk assumption and risk funding.
What's your risk management philosophy?
The simple answer is to ensure that SKF does not have any losses and to protect our brand throughout the world. Maintaining our status as a world-class manufacturing company is always my number one priority. My job is to understand our risk and determine the best course of action to mitigate it, so SKF can manufacture its products without interruption. My team and I work very hard to identify SKF's various risks and then communicate our findings to senior management. I believe that open communication and an unwavering commitment to understanding and documenting all of our risk leads to minimal losses.
What kind of team do you have in place to help you deal with risk at SKF?
My team is unique because even though it is a small team of employees, we also have designated loss prevention site coordinators at each of our manufacturing plants around the world. The site coordinators are tasked with understanding the risk at their sites and reporting any deficiencies. This has been a successful model for us as these individuals are not only involved in the identification of risk at their facilities, but also in the development of risk management strategies to address them head-on.
Tell us a bit about SKF's relationship with FM Global?
We really have a fantastic relationship. We both share the same goal—to improve SKF's resilience. FM Global's client service team and engineers help us understand our risk and work with us on solutions to improve it. Understanding our risk is very important to us. At the end of the day, it is our risk and we must put our company in the best possible position to succeed. FM Global's practical, proven solutions help us to do just that.
Does SKF face any risk management challenges that are unique to its business?
We are a global company. The products we make and the markets we supply are found everywhere in the world. This makes us somewhat unique and our risk management approach mirrors that. Our strategic approach enables us to focus on dedicated tasks and challenges, while at the same time, lets us reach as many areas within SKF as possible. Much of my day is spent bridging cultural divides in order to facilitate change and risk awareness at our facilities worldwide. Knowledge and risk awareness are where everything starts.
What risks keep you awake at night?
Even though we are well-prepared in our loss prevention work, I, of course, worry about having a large loss that could potentially affect SKF's people and business, but at the same time I have to accept it as a part of my job.
Do you have any words of advice for someone who wants to be a risk manager?
First and foremost, you must fully understand all aspects of your job and learn how to articulate your goals and objectives to people at all levels of the organization. Communication skills are very important in this role. If you can clearly explain the risk and the consequences of not addressing it, you will get a much better response from senior management.
What do you foresee as SKF's greatest risk improvement challenges in the next five years?
Improving resilience at our strategic sites worldwide so they can all be designated as highly protected. We always strive to be a preferred partner to our customers and deliver without any interruption in order to maximize our cash flow and operation margin.