Presentation on theme: "CAE Flightscape User’s Conference"— Presentation transcript:
1CAE Flightscape User’s Conference The Business Value ofSafetyOctober 2, 2012
2THE VALUE OF SAFETY Macro Tactical Sales Stock Price Right-to-Operate Market CapRight-to-OperateTacticalCost-Benefit AnalysisROI, NPV or DPP…Cumulative Savings
3THE VALUE OF SAFETY Macro Tactical Sales Stock Price Right-to-Operate Market CapRight-to-OperateTacticalCost-Benefit AnalysisROI, NPV or DPP…Cumulative Savings
4THE VALUE OF SAFETY Macro Tactical Sales Stock Price Right-to-Operate Market CapRight-to-OperateTacticalCost-Benefit AnalysisROI, NPV or DPP…Cumulative Savings
5THE VALUE OF SAFETY Macro Tactical Sales Stock Price Right-to-Operate Market CapRight-to-OperateTacticalCost-Benefit AnalysisROI, NPV or DPP…Cumulative Savings
6LEARNING OBJECTIVESCan Safety yield cultural gains and financial value?Is SMS the correct roadmap?Sikorsky’s legacy:Does it actually lower riskand earn money?Should this all be considered byour customers and their insurers?
7SAFETY CULTURE INDICATORS Chronic uneaseSafety seen as a profit centreNew ideas are welcomedGENERATIVEPROACTIVEResources are available to fix things before an accidentManagement is open but still obsessed with statisticsProcedures are “owned” by the workforceCALCULATIVEWe cracked it!Lots and lots of auditsHSE advisers chasing statisticsWe are serious, but why don’t they do what they’re told?Endless discussions to re-classify accidentsSafety is high on the agenda after an accidentREACTIVEPATHOLOGICALThe lawyers said it was OKOf course we have accidents, it’s a dangerous businessSack the idiot who had the accidentPresentation by Patrick Hudson of Leiden University toBristow Safety Conference, Lagos Nigeria, Feb 2011
12COMPETITIVE EDGEBy protecting its employees and remaining dedicated to “doing the right thing”, Sikorsky has reduced its accident rates, workers’ comp costs and carbon footprint to become a company synonymous with strong environmental leadership, safety and environmental responsibility.
13We pioneer flight solutions that bring people home everywhere…every time™
15Sikorsky Aircraft Corporation October 23-24, 2007BRIDGING FINANCE & SAFETYBUSINESS TALKFinance/OperationsSafetyEarnings/EPSAccident ratesROIProperty lossPaybackInsurance premiumsPVRRFines and citationsInternal Rate of ReturnNo. of people trainedProduction ratesExposure AssessmentsEarnings/employeeNear missesROHSEINet Present ValueBridgesBehavioral ObservationsCost Benefitthe GapAudit findingsROHSEI, Washington, DC15
16The ROHSEI Task Force Objectives: October 23-24, 2007The ROHSEI Task Force Objectives:In 1995, a taskforce of fifteen Fortune 500 companiessponsored the development of a process and supportingtool set to determine the financial value of Safety investments:Build an accepted business tool.Apply an easy to use process.Communicate value of Safety investments.Improve performance by encouraging better decisions.ROHSEI, Washington, DC
17Examples of ROHSEI Projects October 23-24, 20071. Sprinkler Protection2. Onsite Primary Healthare3. Disability (STD/LTD) c Mgmt4. Disposable Coverall Recycling5. Soil Remediation6. HSE Websites7. Behavior Based Safety Programs8. Primary Healthcare in Europe9. Epidemiology Studies and Software10. PPE vs Engineering Controls11. Ergonomics Programs (Lower back)12. Ergonomics Programs (Work Station)13. Fleet Safety Programs14. Electronic MSDS Systems15. PSM16. Integrated Health and Wellness17. IH for the FDA18. FDM19. EGPWS20. SMS21. Sim Training22. FOQAROHSEI, Washington, DC
18The ROHSEI Navigation Screen Process – HorizontalTools – Vertical
33Using Lloyd’s of London estimate of loss per accident…
34Similar calculations to before on cost per year.
35Same transparency of calculations for the finance geeks.
36And an even better payback then just an SMS And an even better payback then just an SMS. Included in this calculation was the cost of a sortie and the profit of each flight which allows a calculation of the savings in terms of additional sorties, the decrease in the cost of each flight ($1028) and the percent saved per flight (20%). Not bad huh?
37MY CONCLUSIONS 1. Safety yields value. 2. This value can be calculated.3. It should be consideredby our customers and theinsurance industry.4. We’d love to work with you on this.David Eherts PhDVP and Chief Safety OfficerSikorsky Aircraft CorporationStratford, CT USAOffice:Cell: ( GMT – 5 )Jill BrowningManager, A&PS - SMCCSikorsky Aircraft CorporationHorseheads, NY USAOffice:Cell: ( GMT – 5 )