Safe business = good business
Production safety is a priority task for any industrial enterprise. This matter is particularly important for managers of complex production facilities with high potential of emergencies or accidents. Safety assurance is a non-stop process that must involve highly skilled professionals and that requires continuous management attention.
A mistake that many companies make is to reduce all work to restrictions and rules. Then the process is perceived by employees as extra work that interferes with the main task of fulfilling production targets. Leaders are often skeptical that all injuries and fatalities without exception are preventable. However, experience from world leading companies proves that all injuries are preventable and fatalities can be reduced to zero. Moreover, positive safety results have a direct effect on business performance. Accident and incident prevention is a straightforward path to improving asset performance, raising workforce productivity, and eliminating production risks. In other words, high performance does not exist without safety.
In the last ten years, significant changes have occurred in the assurance of industrial and occupational safety in Russian and CIS companies. This evolution has had an impact on management systems. First, attitudes of executives and senior management towards safety have changed. Some of them have managed to bring their sites to a high level, while others are only embarking on this journey. Despite a significant gap between performance of world leaders and that of Russian companies, changes are inevitable. This is manifested in the general trends and in the attention that the state pays to the topic of improving safety of production operations.
Many site leaders confirm that they would like to achieve safety performance of world-class leaders. However, only a few are prepared to invest the means, mobilize resources, and to spend personal time to achieve outstanding safety results. Often this process looks as follows: the objective of reducing injury and accident rates is turned over to the HSE department, which year after year attempts to implement injury and accident prevention standards, procedures and practices. Certainly, some positive results are observed. Soon, a ceiling is reached in these improvements and then the dynamics begins to decline. Subsequent measures, such as implementation of new technical means, use of various techniques, incident investigation, or identification of key risks do not bring significant improvements. These activities are perceived by the majority of production people as extra work. For example, recent studies have shown that at sites with standard safety assurance philosophies, 70% of employees think that the measures applied are not justified and that the whole process is a waste of time, while 50% of employees are certain that management will ignore their efforts, and 60% believe that their contribution at the workplace is underappreciated. This data indicates a serious problem, i.e. lack of employee engagement in the process, and distrust towards leaders and lack of confidence in the results.
We have seen proof at many large companies that significant operational excellence savings can be achieved by engaging employees in solving operational tasks and by implementing ideas for work floor personnel.
For example, maintenance services workers vested with relevant authority and accountability make the best use of production equipment and maintain optimized process regimes. This solution is a lot more cost-effective than passing accountability for improvements to a dedicated efficiency-improvement department. Therefore, the overall high level of safety culture, and a self-dependent, motivated and engaged workforce are the basis for high performance production sites.
International experience indicates (see Bradley curve) that transition to new business performance levels can be achieved via qualitative changes in the behavior of production personnel who share company values and who contribute to the strategic company goals daily.
WHY IS IT NEEDED?
Leaders of world-class companies go to great lengths to create safe workplace conditions and to develop process commitment in their employees. What motives do they have?
There are various reasons in addition to reducing the damage caused by accidents or injuries, such as improving asset reliability and integrity. First, safety awareness forms operational discipline among production workforce. Second, by caring for the safety of their personnel, company leadership increases employee engagement and loyalty. This in turn helps improve the site’s reputation as a local employer. These factors put together, i.e. production discipline, workforce engagement, and attractive employer reputation have a direct effect on the personnel’s productivity and help unlock employee potential. The number of improvement ideas generated by production personnel increases. The site attracts promising employees and thus ensures the best pool of candidates for future managing positions etc. In the long term, this helps improve business performance and is conducive to company growth.
And vice versa, if a site cannot ensure safe workplace conditions, and if injuries, accidents and equipment failures occur on a regular basis, this kind of environment demotivates employees and discourages people from looking for improvements. Then, the self-preservation mechanism kicks in quickly and causes people to act instinctively and rashly resulting in serious errors. The most promising employees leave the company to join competitors. Accidents and unscheduled shutdowns harm the company and reduce performance. To meet production targets, it is often necessary to replace or to upgrade equipment, and it is very hard to do so when investments are being reduced.
Therefore, ensuring the safety of production facilities is key for the successful site operation and development. Systemic leadership efforts intended to create advanced safety culture will yield tangible and sustainable results:
- Creation of safe workplace environment that helps unlock employee potential.
- Reduction of workplace error rates.
- Equipment integrity and extension of its service life.
HOW TO ACCOMPLISH THIS?
Now, it is obvious that a high level of production safety must be ensured. However, leaders have many questions, e.g. What needs to be done? What is the amount of resources and investment required? When will these investments pay back? How to hire competent HSE experts? How can the organization be trained and safe behavior cultivated? The duration and the scope of changes is often scary.
Experience from world-class leaders helps pinpoint the key success factors that guarantee substantial results within 2 or 3 years of continuous work.
First, unfailing support, continuous participation, and role modeling by company executives is imperative. Second, a competent HSE service is to be set up to provide methodology support in identification and elimination of key risks. Third, working with middle management is a must in order to form a critical body of leaders who share the new safety philosophy and apply it in their daily activities.
Creating a safe organization means transforming all levels of management, setting correct priorities, and defining cardinal rules of safe behavior and of continuous employee engagement in injury prevention activities. These actions are like implementation of lean production principles. Therefore, the most effective measures are the ones that are simultaneously intended to raise safety levels and to improve performance.
The approach that the largest global companies apply to improving safety and performance encompasses the entire organization, i.e. accountability is defined at every level of management and authority is delegated to enable timely decision-making. This approach fully replicates the principles of identifying and eliminating losses, and focuses on identifying risks, near misses and employee acts that can result in injuries. The more information about risks and hazards is collected, the greater the chances to successfully prevent accidents or injuries. For this purpose, organizations must be taught to record near misses and unsafe acts and to engage production personnel in further analysis.
Without doubt, there are many advanced risk analysis techniques available. Many companies have implemented corporate standards that are based on best international practices. However, effectiveness of these practices is extremely low despite successful international experience because the sites are not able to transform without serious prior preparation. Such factors as poor discipline, inadequate competencies, or lack of support by the workforce are the reasons why implementation of practices fail and why these tools turn into a list of formalities and become extra work for employees.
Leaders who are planning changes need to realize that standards of no kind will work unless people’s mindsets and behavior are changed. A quantum shift is to be made from dependent employee behavior to a conscious one, from hiding facts to being open, from fearing punishment to preventing incidents proactively. Such a transition is possible only when people at all company levels from the chief executive to work floor personnel act with the same purpose in mind.
CONCLUSIONS AND FURTHER STEPS
The current economic situation forces producers to improve performance, and to ensure integrity and longer service life of their assets. In addition to financial performance, one of the signs of a successful and competitive company is a cohesive team that can solve production tasks quickly and effectively. In addition, they need to identify and eliminate causes of loss, and to create a safe environment at the site. The top priorities for leaders who plan to implement safety improvement programs should include the timeframe required to yield results, the amount of investment and resources to be mobilized, the scope of equipment upgrading, among others.
International experience indicates that changes are feasible in any company regardless of employee readiness or technical level. Transformation of corporate culture and changes in personnel behavior take time. With a competent approach and continuous efforts, tangible and sustainable results can be expected in 2 or 3 years. Transformation is a complex process and it requires non-stop management attention.
Therefore, management must determine independently how ambitious company goals are and what means and resources can be allocated to solve these tasks. Will the organization’s internal potential and competencies be sufficient to execute the plan? The next step is to allocate resources that are adequate to the objectives. If needed, assistance is to be obtained from industry experts who have experience with similar transformations.