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Safety Culture, Performance & the Bottom Line GSMC/PBCW1.

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Presentation on theme: "Safety Culture, Performance & the Bottom Line GSMC/PBCW1."— Presentation transcript:

1 Safety Culture, Performance & the Bottom Line GSMC/PBCW1

2 Many challenges exist in today’s Workplace – Unstable Economy – Cyclical Growth & Profitability – Limited & Aging Workforce – Competition for Skilled & Experienced Staff – Compliance to new Rules & Regulations – Meeting Customer & Industry Demands – More with Less Improving your safety program will have a positive effect on your employees and bottom line! Its not only required by law… IT’S THE RIGHT THING TO DO!

3 ~ 1,250 workers are killed each year in the Construction Industry, the highest of all industries. The construction industry reported 155,420 disabling work-related injuries in 2003. Of these, 109,400, or 70 percent, fell into five categories: overexertion, same-level falls, bodily reaction, falls from heights, and struck by object. Falls continue to be the leading cause of death. Hispanic workers and Laborers are the most “at risk”. ALL of the Deaths and Injuries were Preventable! 3

4 Over 5,488 fellow workers died on the job in 2007! – That’s an average of 21 people every work day! 2007: – $7.2 Billion paid to 500,000~ workers on long-term disability insurance. – 1.2 million Day Away Cases ($150 billion) – 4 million total Recordable Cases ($180 Billion) Todays Workforce still Experience Horrible Injuries & Deaths

5 The Workers Compensation costs for the most disabling workplace injuries and illnesses in 2006 was $48.6 billion! 2008 Liberty Mutual Workplace Safety Index This COST does not include: This COST does not include: – Lost productivity – Replacing Injured Worker – Schedule/Production Impact – Increased Insurance Premiums (EMR) – Decreased Morale and Productivity of fellow workers – Collective time of Incident Investigation – Implementation of Corrective Actions – Pain & Suffering

6 Chevron Corporation – Total Injury Cost Benchmark data: Estimated total inclusive cost of injuries: – Recordable Injury: $45k/Injury – Days Away Case Injury: $125k/Injury Most organizations fail to realize the true “IMPACT” that injuries and incidents have to their bottom line!

7 1973 - California Occupational Safety and Health Act – Stipulates that every employer has a legal obligation to provide and maintain a safe and healthful workplace for employees. 1991 - Injury and Illness Prevention (IIP), – IIPP is required for every California employer. 1999 – AB 1127 – Increased Penalties and allowed criminal prosecution of managers 2011 – AB 2774 – Increases OSHA’s ability to cite serious and willful safety violations

8 Many studies show a direct link between “Cultural Norms” and Injury/Incident rates. 2007 Study* & Interviews of hundreds of injured construction workers found that workers exhibited unsafe behavior because of: – a lack of safety expectations/awareness – macho attitudes – schedule pressures – co-worker attitudes – Lack of management engagement & leadership – and other organizational, economic and psychological factors (Culture). 8 *Why operatives engage in unsafe work behavior: Investigating factors on construction sites, 2007; Rafiq M. Choudhry & Dongping Fang

9 Inadequate Leadership or Supervision. Inadequate Engineering. Inadequate Hazard Analysis. Improper/Inadequate Tools and Equipment. Inadequate Maintenance. Inadequate Work Planning/Procedures. Equipment Failure. Inadequate Training. 9

10 Allowed Behaviors- Inadequate Leadership or Supervision Learned Behaviors- Proper Training? Defiance-Resistance to Follow Procedures Inadequate Physical or Mental Capability. Lack of Knowledge. Lack of Skill. Stress No Positive Recognition-Improper Motivation 10

11 Culture adaptation is an evolutionary process by which humans modify habits and customs to fit in within existing norms. Your Safety Culture is a subset of your Corporate Culture




15 The “absence” of Injuries & Incidents? Meeting “acceptable” Injury Rates and Performance Goals? Maintaining “industry average” Loss Rates/EMR/RIR? Staying off the Regulatory Radar? How many believe you have obtained “Success” in your Safety Program? 15

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17 17 Foam Break-away During Columbia Lift-Off

18 18 Debris “spray” after foam hits Columbia’s left wing

19 19 Projected cost per flight; $7.7 million; actual cost $500 million (65X) (estimated total program cost per flight is $1.5 billion) By 1989 launch predications fell from 50 flights/year to 24 Average turned out to be 4/year 10 day turnarounds became 67 days Budget cuts and policy changes resulted in headcount reduction, increased pressure on schedules and cost. By flight time, Columbia STS flight 107 had suffered 13 delays.

20 20 Post-launch analysis shows that one large piece struck Columbia on the left wing 81.7 seconds after launch. Large foam piece was: 21 to 27 inches long 12-18 inches wide Struck the shuttle at 416 to 573 mph The NASA “Inter-center Photo Working Group” engineers were concerned that the Columbia had sustained damage not detectable in the limited number of views their tracking cameras captured

21 21 Internal memos warned that damage to the wing’s leading edge could cause “burn-through” during re-entry The Working Group Chair requested high-resolution images be taken by the Department of Defense 3 requests were made to image the orbiter in-flight They were ALL denied when upper level engineers deemed the impact as “not a significant threat to flight safety.”

22 22 Incident Review board’s comments: Budget and policy pressures ultimately had an impact on the organizational structure and culture. The investigation report should be read by anyone who works in large organizations. It uncovers the blindness in organizational decision making, shows how this occurs, and how this can be remedied. NASA’s culture had gradually begun to accept escalating risk. NASA’s safety program was largely silent and ineffective. Ultimately - it recommended creation of an independent Safety/Reliability & Quality assurance office.

23 23 “In our view, the NASA organizational culture had as much to do with this accident as the foam” “Organizational culture refers to the basic values, norms, beliefs, and practices that characterize the functioning of an institution. At the most basic level, organizational culture defines the assumptions that employees make as they carry out their work” “It is a powerful force that can persist through reorganizations and the change of key personnel. It can be a positive or negative force.”

24 The casual acceptance of problems/events/risks that are not suppose to happen has been described by sociologist Diane Vaughan as the “normalization of deviance” This led to “smart” people making questionable decisions justified by a belief that it was best for the program! “Program managers required engineers to PROVE that the debris strike created a safety-of-flight issue; …engineers had to produce evidence that the system was unsafe rather than prove that it was safe…” 24


26 On October 6, 1999, Governor Gray Davis signed AB 1127 into law. Effective January 1, 2000, AB 1127 amends Cal/OSHA (the California Occupational Safety and Health Act) to add the most massive civil and criminal penalties ever found under an occupational safety and health law.

27 Large Increase in criminal penalties under Cal/OSHA. Individual managers and supervisors may now be fined up to $250,000 and be imprisoned for up to four years. Criminal fines range up to a maximum of $3.5 million in fines for corporations and limited liability companies. Cal OSHA civil penalties can now be assessed against government entities.

28 Defines the term "willfully" to simply mean a willingness to commit or not commit an act. The term "willfully" for Cal/OSHA purposes will not require any intent to violate law or to injure someone.

29 Effective Jan. 1, 2011: amends labor code section 6432 to define serious physical harm and establishes a rebuttable presumption as to when an employer commits a serious violation of these provisions. “Rebuttable Presumptions” effectively reverse the presumption of innocence in some cases! The law, which went into effect on the first of year, authorizes Cal/OSHA, to define how serious violations of safety in the workplace are cited.

30 New factors used to accurately issue serious citations include: – any training given to employees and supervisors, – existing workplace safety procedures, – supervision of employees exposed to the hazard, – any contributing information the employer wishes to provide to explain why the employer believes that no serious violation exists.

31 In California every employer is required by law (Labor Code Section) to provide a safe and healthful workplace for his/her employees. Title 8 of the California Code of Regulations (CCR), requires every employer to have an effective Injury and Illness Prevention Program in writing that must be in accord with T8 CCR Section 3203 of the General Industry Safety Orders. Additional requirements in T8 CCR Safety Order Sections address specific industries


33 Many studies * show a direct link between World Class Safety & Organizational Excellence in: – Quality – Reliability – Competitiveness – Employee Morale – Profitability But How & Why? * Improving Safety Culture, Dominic Cooper.

34 Survey of over 600 companies found that the quality of the safety culture was directly related to: – Advanced work methods (Competitive Advantage) – Reduced absenteeism (Improved Productivity). – Improved Organizational Performance (Quality, Reliability & Teamwork) – Employee commitment & trust Studies of the US Construction Industry* show that projects with World Class Safety programs meet schedule and budget more often. High performing teams improve profitability at any company. *Construction Industry Institute

35 World Class Safety Programs demand excellent processes, procedures and policies to exist. Surveys of successful companies show: – Safety process expectations are mirrored across all other functional areas. – Reliability improvements as high as a factor of 10 due to: Fewer Human Errors Continuous Improvement Processes Feedback Mechanisms – Improvements in employee attitudes towards safety transferred over to all other functional areas.

36 World Class Safety Cultures instill loyalty and passion. Senior Managements role is to empower, engage & energize employees through Safety Leadership! Dedicated employees work harder, longer, more efficiently and have better attitudes about their job! Employees that BELIEVE their company cares about them, care about their company and the quality of the work they perform!

37 10 Methods for Improving Safety Performance 37


39 Once leadership establishes its commitment to safety, Cultural Boundaries are formed. Your Leaders Actions demonstrate their commitment: – What management pays attention to: SAFETY vs. SCHEDULE vs. CO$T Decisions that are made & why – What management ignores: Employee concerns, feedback, suggestions Production or Schedule overriding safety issues – What management measures and how they respond: What does management really care about? 39

40 Key Safety Leadership Qualities – Personal Commitment to Safety – Positive Role Model of Safe Behaviors – Open 2-way Communication at all levels – Demonstrated Engagement in all aspects of the Safety Program – Understanding of “Behavior Based Safety” – Management Accountability – Active Participation in the Recognition Program 40

41 Key Employee Needs: – Appreciated – Respected – Feel that management “cares” about their safety Employee perceptions represent the true safety culture The employees at greatest risk of injury must be: – Engaged – Enabled – Empowered Before World Class Safety Performance can be realized!

42 Robust Hazard Analysis Process – Proactively assess workplace hazards PPE Evaluations and Selection Criteria – Ensure employees are fitted and PPE is effective Pre Task Planning/Hazard Recognition – All medium and high risk task should require a hazard recognition and mitigation plan Behavior Observation Tool – Evaluate if your employees are following procedures – If not, why?

43 Behaviors – Behavioral Observation Process Conditions – Collecting data from field walks and employee feedback Training – Competency, Compliance and Retention testing of employees Work Planning – Use of JHA’s, Pre Task Planning, permits Management Leadership & Commitment – Measure time in field, Classroom Instruction, Leadership efforts, % complete of assigned safety tasks Project’s Cultural Maturity – Project team assessments, contractor feedback, Safety Self Assessments 43

44 Employees need access to forums, committees or other means that allow direct communication of safety concerns to management Direct feedback mechanism that shows safety concerns have been addressed in a timely manner Employees must not be afraid to report injuries or near misses. Employee need to feel part of the safety process and effective communications will elevate their trust & respect of management

45 World Class Results depend on Best Known Methods Improve your methods by Benchmarking: – World Class Organization – Competitors – Trade Organizations – Consultants

46 Most training programs are dry, boring and ineffective in educating the workforce Effective training is designed to address the needs of the employees, not to satisfy regulatory requirements All training should include feedback mechanism from employees for continuous improvement

47 Key Elements of an Effective Safety Training Program include: – Trainers have the greatest impact on effectiveness – Delivery is EVERYTHING! – Delivery is EVERYTHING! - the average attention span is 12 minutes – Interaction – Interaction - Employees must be engaged to learn – Clear, Concise & To The Point – Clear, Concise & To The Point - remove non value added material – Test for Competence – Test for Competence – Ensure that knowledge has been transferred

48 Incentives create undesired results: – Non reporting of incidents – Hiding of injuries – Creates feelings of entitlement Positive Recognition Benefits: – Rewards Observed/Desired Behaviors and Performance – Effective as Spontaneous and Milestone Recognition – Encourages Employees to Maintain Recognized Behaviors – Makes Employees Feel Appreciated – Helps sustain a functioning world class culture

49 Key to Sustaining a World Class Safety Cul ture All Injuries & Incidents must be analyzed to Determine Root Cause & Prevent Reoccurrence Review all Programs, Policies & Procedures annually to ensure material is up to date and useful to end users Safety Self Assessments should be conducted to ensure the overall safety program is successful and meeting the needs of the organization

50 Incident investigations should be designed to prevent reoccurrence Process must be fair and focused on finding the root cause All incidents and near misses should be investigated 6 key questions should be answered: – who, – what, – when, – where, – why, – and how To identify key corrective actions that will Prevent Recurrence! 50

51 Most organizations have safety programs that are designed to meet regulatory requirements… NOT EMPLOYEE NEEDS! Safety Programs should: – Go above and beyond OSHA requirements – Engage employees in their development – Be living documents that change as conditions and needs change – Protect your most valuable asset, your employees!

52 Phase 0 Huh? Phase 1 No Jail Phase 2 Save $ Phase 3 Priority Phase 4 Value Phase 5 Instinct People/Culture Focus Program Development/Data Focus Discipline/Compliance Focus What is Safety? Try to Comply with the Minimum (OSHA) Accidents Cost Too Much Safety is a Core Value World Class Safety Performance Safety is a Priority 52 Safety Performance



55 Which role will you assume in Cultural Change? – Domain Defender? – Reluctant Reactor? – Anxious Analyzer? – Or… Enthusiastic Prospector? * “You must be the change you wish to see in the world.” Mohandas Gandhi Mohandas Gandhi 55 *Adapted from Goffee and Jones, 1996.

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