Which soft skills are most valuable in actuarial work?
In this article I take a deeper dive and more data-evidenced look at the application of wider business skills in actuarial environments. The aim is to identify some of the key skills that I commonly see in the most effective and high-performing actuaries, and try to separate them from the ‘corporate waffle’ that can raise its head in this area.
Softer skills, aka wider business skills, are an interesting quandary when it comes to assessing candidates against role specs or even in performance management.
It’s easy to see how generically worded softer skills such as “Good team player” or “Strong communicator” carry so little power as to be worthless. Using the role or job spec example scenario, any individual (or agency proposing an individual) is unlikely to even actively consider the requirement, thinking it’s a trivial hurdle, and instead focus only on the core technical skills provided in a spec.
Yet it’s also true that softer skills undoubtedly appear to be of greater value in practice. For example, an analysis of the client feedback surveys that we carry out as standard at the end of a staff secondment clearly demonstrates that the likelihood of a client believing a placement has materially exceeded expectations is much more correlated with a positive perception of wider skills relative to deployment of impressive technical ability. Another perspective to consider is the relative pathways of those qualifying as actuaries. There is less empirical evidence to back this up, but I have little doubt that, post-FIA, a trajectory to more senior (and often financially rewarding!) roles is more likely for the actuary who is “technically competent but with very strong wider business skills” than someone holding converse strengths.
Despite this I lose count of the number of entrants into the profession that invest heavily in their technical skills but rarely take active steps to improve these wider skills.
Here I present a few key examples of commonly discussed wider business skills, using some real-life extracts from client requirements or specs that resonate with me as being of particular value within an actuarial environment. In my view, these act as a powerful differentiator between higher and average performing actuarial staff.
- Provide communication of complex areas in a way that is targeted and appropriate to the audience
- Structure insights into clear messages and effectively engage others within actuarial function, as well as other internal stakeholders, and professional and regulatory bodies
- Deal confidently with uncertainty, lean into difficult conversations while lowering the pressure of resistance
- In the face of challenge, remain positive in approach and able to respond to issues as they arise
- Take time to actively solicit, and objectively listen to, all viewpoints before forming an opinion
The last of these, i.e. listening, appears to be a commonly undervalued aspect in perception of what constitutes strong communications skills. For example, poor listening skills can lead to too much haste in extrapolating a current situation to fit a previously satisfactory solution.
Problem-solving / Inquisitiveness
- Visualise, articulate, solve both complex and uncomplicated problems by making decisions that are sensible given the available information
- Use a variety of diagnostic techniques to understand a situation / issue / problem by breaking it down and tracing the root cause / underlying implications in a methodical, step-by-step way
- Design methodology and provide clear testing requirements / acceptance criteria
- Think critically and interrogate problems and challenge when necessary
- Innovate and challenge current norms, utilising consultative questioning, to drive change within the actuarial function
It should almost go without saying that individuals who prove themselves able to think deeply and navigate challenging problems are likely to be identified as high performing. Work out where your strengths lie – some actuaries relish and excel in analysing and re-engineering detailed processes (e.g. to shorten financial reporting timescales) while the strength of others may lie in bigger-picture or more strategic-level issues.
- Use experience to know when to reach out for support
- Employ attention to detail, as well as the ability to check the reasonableness of own work, and articulate why results / conclusions of work produced are appropriate
- Combine technical analysis and judgement-based inputs with appropriate signposting of limitations
A key focus here is recognising and disclosing uncertainty, which is, after all, the core of actuarial practice. The hardest part of this is the former, where too great certainty in one’s pre-existing view and a lack of inquisitiveness (see above!) can be causes of bad practice. A common example in actuarial work would be recognising that part of a technical or calculation specification could be interpreted differently (or indeed written with a differing intention). Personally, I have found such judgement to be one of the best differentiators in assessing capability of actuarial students.
- Anticipate changes in the environment and ensure that work areas are appropriately set-up to adapt to likely future changes
- Draw key conclusions based on complex and possibly incomplete data
- Efficiently use information to provide insight to others or to help solve business issues
- Demonstrate willingness to make commitments based on all information known at the time, and deliver upon those commitments
A common theme in these points is the need to understand that, as actuaries, we are often required to make conclusions and recommendations based on data and assumptions that are unlikely to be correct. Understanding the commercial significance of such decisions and drawing out and quantifying uncertainty are again key themes at the core of the actuary’s skillset and are to be embraced.
Management / Delivery Lead capabilities
Core skills at less experienced levels, including many actuarial student roles, may commonly include requirements referring to management of self, such as:
- Proactively propose appropriate deadlines for delivery
- Effectively multi-task and prioritise own work against needs of business
- Self-lead and work effectively both independently and within teams
- Accept accountability for work output and take appropriate actions to address any shortcomings identified
For more senior roles or those requiring accountability or responsibility for delivery, we may see requirements such as:
- Propose resolutions to issues and manage analysts as appropriate
- Assist others with managing conflicting work and time pressures
- Lead/ drive initiatives, e.g. running workshops and focus-meetings
- Run / manage the overall process, finalise / pull things together and then present results to senior actuaries
- Identify wider knowledge-sharing needs within the team
An obvious question is: how does one develop the skills needed to bridge the gap between the first and second lists? One approach I think to be useful for more junior actuarial staff is to actively ‘Think like a manager/reviewer’ and consider whether you are delivering what your manager or reviewer needs to most efficiently check or sign off your work.
For example, in an Excel model build:
- Is your model’s calculation logic as understandable as it could be?
- Is your model easy to run?
- Does your model include clear user instructions, data validation, version history, and permit an audit trail?
- Have the key uncertainties, interpretations and limitations in your model been made explicit?
Those that demonstrate empathy with the manager’s position are clearly providing a strong signal that they would be equipped to take on such a role themselves in future.
It is clear that the ability to improve and develop the type of skills detailed above first demand that an individual sees doing so as of at least equal priority to improving more technical skills.
The next step can often lie in seeking feedback from colleagues or managers. The most value is to be gained not through generic feedback, but by asking for input on performance in a number of the specific areas discussed here, and working together to identify opportunities where there is greatest scope for improvement.
Any shortfalls may naturally close in time through additional experience, but more active steps, such as creating a development plan and so more actively considering these aspects of your work, or perhaps through some targeted training, can be expected to accelerate such a process. The consequent benefits to not only yourself and your future prospects, but also your colleagues and employer, will reward the time invested in the development of soft skills many times over.