1. MEASURING THE VALUE OF AN EMS AND SCORING THE EMS RESULTS August 19, 2004

2. EHS AS A “COST CENTER” Most organizations see EHS as a cost center
These companies are focused only on regulatory compliance
Management initiatives can help move EHS into the core business
Lean, Six Sigma, Lean Six Sigma
Operational Excellence (Baldrige Model)

3. EHS INTEGRATION
Using quality management as a language for all of the programs
OHSAS 18001, SA 8000, AA 1000, ISO 9000
Lean, Six Sigma, Operational Excellence
Driving improvements through people and programs
Scoring the program using the Baldrige Model

4. SYSTEMS APPROACH Proven method for improving processes
Uses employee-driven “bottom up” approach
Provides for management oversight
Tools common to all the programs mentioned
Links to management information systems
ERP, MRP, CMMS, Business Results

5. MRP SYSTEM Assigns a part number to all resource uses
Needs to track resources to a work step in the hierarchical process map
You need to assign a part number to all wastes, discharges, emissions, spills, etc.
Create a computerized way to track resource use and loss in the operation

6. CMMS SOFTWARE APPLICATION
Assigns a work order number for each activity
e.g. Obtain air permit, file manifests, keep records, monitor stack, conduct audit, etc.
People charge time to work order numbers
Work orders assigned to work steps using the activity accounting sheets

7. ACTION PLAN FORMAT Alternative Selected Action Date: Purpose Project
Benefits
Action
Responsible
Person
Performance
Standard
Completion
Deadline
Resources
Needed 1 2 3 4

8. ACTION PLAN COMPONENTS
First action step is to perform a baseline analysis for weight/volume reduction and cost savings
Second step should be the alternative at the top of the prioritization listing
Next to the last action step is to repeat the baseline analysis to determine quantitative results

9. COST ACCOUNTING Link a spreadsheet to the resource accounting sheet
Link a spreadsheet to the activity accounting sheet
Input cost information from MRP and CMMS
Create a Cost Accounting Sheet to combine these spreadsheets

10. EHS COSTS Traditional Accounting Activity-Based Management
Manage activity costs
Real Options for Intangibles
Delphi group look at EHS issues
Cost assigned as an option cost
Cost discounted for use by accounting

11. INTERNAL IMPROVEMENT SCORING
Scoring the continual improvement of your EMS (ISO 14001) program
Influencing the behaviors that will drive change and success in the program
Scoring of the results to focus on areas where improvement is necessary

12. SCORING AND THE BALDRIGE MODEL
There are two parts to scoring true performance using the Baldrige model:
True Performance
Sustainability Results
Scores are issued by trained, third-party examiners
Scores can be used to measure and trend sustainability progress and any type of facility and aggregated across the enterprise

13. SCORING TRUE PERFORMANCE
The Baldrige criteria document and it’s State of New Mexico counterpart (Green Zia) have more than 100 questions to answer in a 50-page application
Currently used in over 60 countries to measure overall performance of the company
Program is transparent, copyright-free and continually improved every year

14. USING THE BALDRIGE MODEL
Some organizations apply for awards in established programs - state and federal level
Model can be used as a self-assessment tool
Factor analysis can be used to create a diagnostic for surveying employees
Each method has a “feedback” report to drive continual improvement
Each method scores the true performance of the organization

15. PERFORMANCE CRITERIA Leadership Strategic planning
Influence of other interested parties
Use of management information and analysis
Employee involvement and well-being
Process management

16. USING A DIAGNOSTIC SURVEY
Pojasek & Associates has used factor analysis and reduced the number of questions in the performance criteria to 22
Wording of the questions must address sustainability and the culture of the employees
Questions are asked to a random number of employees in the organization

17. USE OF A DIAGNOSTIC
Questions delivered to employees either by a web enabled questionnaire or a paper survey form or both
Considered less painful than a 50-page application
Diagnostic is handled like a 360-degree performance review
Questions can be extended to the “other interested parties” with some revisions to the wording

18. TYPICAL QUESTION
Senior leadership personally and visibly demonstrates its commitment to
the sustainability program in this organization
Agreement:
Indicate how strongly you disagree/agree with this statement.
o o o o o o o o
N/A Disagree Agree

19. DIAGNOSTIC COMPONENT
Employees can explain their scoring with words to be compiled
and used in the “feedback” report.
Cite some strengths of the senior leaders in this category.
List some opportunities for the senior leaders to improve in this category.
All responses are confidential and maintained by an independent examiner.

20. TRUE PERFORMANCE FEEDBACK
The facility will receive a true performance score from the third-party examiner
Each question will have a standard deviation calculated
Written comments will be be consolidated by the third-party examiner and summarized by question
Strengths
Opportunities to improve

21. RESULTS SCORED SEPARATELY
Improvement results and indicators can be scored by a third-party examiner just as the true performance was scored
Results categories include:
Environmental
Social responsibility
Other interested party involvement
Financial
Other program indicators

22. FACTORS FOR SCORING RESULTS
Is the result or indicator demonstrated to be important to the organization? Link to performance
Was the result planned? Was the plan attained?
Did the organization trend the result? Can the trend be adequately explained?
Did the organization benchmark the result? How did it compare?

23. SCORING PROCEDURE
Examiners use a transparent scoring matrix and methodology found at
Examiners file draft feedback report through the lead examiner to a panel of judges
Judges determine if a site visit is warranted to confirm the score (for award program)

24. USING THE SCORES
Some organizations have a single true performance score where the results component score is approximately 40% of the total score
Some organizations prefer to have two scores – one for true performance and one for results and indicators
There are many uses for these scores as a means to track and improve EHS programs

25. HOW WOULD YOU SCORE?

26. Contact Information
Robert B. Pojasek, Ph. D.
P.O. Box 1333
E. Arlington, MA , USA
Phone: (781)
Fax: (781)
Website: