A powerful way to build culture, embrace operational excellence and achieve great business outcomes.
In 1987, Paul O’Neill joined Alcoa as its new CEO. He had a vision for improving the business, but faced resistance from his board, managers and shareholders. Why? Because workplace safety was top of his agenda. He wanted to make Alcoa the safest company in America.
Paul O’Neill did not believe in the traditional view that safety is a trade off against production. Instead, he saw it as a goal that could unite people across the business. In his view, the company’s injury rates reflected the company’s underlying performance. Splashing molten metal not only injured workers but wasted materials. Malfunctioning equipment needed risky repair work, but was also a source of subpar products. Improving safety meant addressing the underlying problems.
O’Neill used safety as a driver to achieve operational excellence, and it worked. When he left Alcoa in 2000, its market capitalisation had grown from $3 to $27 billion, while net income increased sevenfold.
This story illustrates the value of making a fundamental shift in managing and leading safety. Rather than treating health and safety as a separate function, managed by technical experts, safety permeates all functions and aspects of work. Integrating safety is a way to help an organisation realise its full potential.
The value of safety integrated
Safety can be a substantial cost to business, through incidents, injuries and worker’s compensation. These impacts extend far beyond the direct costs, including downtime, lost production, damaged reputation and legal consequences for both managers and the business.
However, focusing only on the negative impacts of safety is limiting. Safety becomes managed by exception rather than a normal part of business. Sites and operations may go for long periods without serious incidents, so safety falls off the agenda. Leaders miss the opportunity to get value from a positive focus on caring for people.
With the right approach, safety can have a significant upside. Safety integrated into a business can:
- Create a common goal that everyone can get behind
- Build engagement and trust between managers and workers
- Harness the discretionary effort of people to go above and beyond
- Excel at managing risks by involving the right people, in the right way, at the right times
- Use incidents to trigger reflection, innovation and genuine learning
- Reduce inefficiency, ineffectiveness and waste
- Foster a reputation as a preferred employer and partner
- Grow a shared sense of pride in working for a business that cares
Research supports this. Companies that focus on the well-being and safety of their workforce yield greater value for their investors.
The benefits are clear. So how do we get safety integrated into our business?
It starts with leadership
For any organisation that wants to take an integrated approach to safety, it starts with senior leadership. First, leaders need to share a clear vision that aligns safety with broader business objectives. They need to be able to personalise the vision and sell it to others with passion.
Second, as a team, the executive should be clear on the change they want to make, how they will role model the right behaviours, and what they expect of others. When people see their leaders spending time and energy on safety, it becomes clear that it is of real importance to the business.
Third, it needs to be a sustained effort. Leaders at all levels need to routinely review progress made, barriers that need to be overcome, and actions to take the next steps. They should hold themselves and others accountable for taking positive action to support the vision.
While these may seem obvious steps in any change program, in reality many leaders defer these actions to their safety professionals. The rationale is that the technical safety experts are best placed to deal with the detail. The problem is that safety stays separate from the main game, with leaders involved only when there is a serious problem, like a major incident, or intervention from a regulator. Safety becomes a case of ‘no news is good news’, rather than an integrated part of strategy and operations.
With safety integrated, the role of safety professionals evolves. Safety advisors need to become facilitators, coaches and change agents. Systems are streamlined to support operational excellence. The safety function needs to support leadership with analysis, insight and honest feedback about both problems and opportunities for improvement.
Safety integrated means involving people across the organisation. This is especially true for frontline workers, who are often most exposed to the physical risks. Leaders need to be active in:
- Spending time in the workplace to understand how real work gets done
- Getting feedback and listening to the challenges people face in delivering safe work
- Reinforcing their vision and expectations
Beyond the front line, an integrated approach engages functions and departments that aren’t normally associated with safety. First, we want to show care for their health and safety. Office work may be considered lower risk, but supporting their wellbeing can create happier and healthier teams. Second, we want to harness their skills and imagination to bring safety improvements from higher up the value chain. For example, how can sales and marketing build better cooperation with clients? Can finance streamline the application process for safety improvements? How can designers and engineers eliminate risks before they come to fruition?
Bring risk management to life
For many organisations, risk management is a static process of forms and paperwork. Risk assessments are completed early in projects, but left to gather dust as people get back to their ‘day job’. This approach creates the illusion of compliance – things look good on paper, but procedures are disconnected from the real work.
Integrating safety means breathing life into risk management. Design procedures and programs for the people who use them. They should be value adding, rather than ‘cover your arse’ forms completed to satisfy someone else. Systems are intrinsically linked with culture, and good systems go beyond compliance to support positive behaviours and good business outcomes.
Atul Gawande captures a great example of this approach in his book the Checklist Manifesto. The World Health Organisation developed a checklist for preventing medical error. The goal was not to tick boxes, it was to embrace a culture of teamwork and discipline; to turn people’s brains on, not off. In the eight hospitals who trialled the checklist, deaths from medical error fell 47%. Although some doctors were still skeptical of the value of the tool, 93% of doctors surveyed agreed that if they were having an operation, they would want the checklist used.
Good risk management is not about creating a rule for everything. It recognises that companies should embrace risk and be comfortable venturing into new and uncharted territories. However, they should do so with eyes wide open to the hazards and be prepared with the right controls. Leaders should prioritise the risks that matter most, and where the consequences can be most severe.
Safety integrated means that workers, supervisors and managers at all levels are comfortable having conversations about risk. They recognise that risk is dynamic – it can change in an instant, or creep up over years. People should know the top risks within their responsibility and control, and be attuned to when these risks change and new ones emerge. People need the authority to adapt and adjust to change, while knowing which lines should not be crossed.
Learn from incidents
Even in best practice organisations, safety incidents still occur. The challenge is whether the response is blame, or genuine reflection, learning and improvement.
This starts with building a reporting culture. People will make errors and mistakes. The question is whether they feel comfortable speaking up without embarrassment or fear. Learning organisations build psychological safety – the belief that you won’t be punished when you make a mistake. By encouraging reporting, minor issues can be addressed before they become major incidents. The impacts extend beyond safety – psychological safety encourages appropriate risk taking, creativity and innovation without fear of blame.
Integrating safety means acknowledging that the root causes of most incidents are conditions created by the organisation – not the errors of people at the frontline. Leaders should bring the right people together to fully understand an incident and find ways to change the underlying conditions. Lessons learned should be shared without shame so that the business can improve as a whole.
When Max Lloyd-Jones took over as Managing Director of Fibremakers, he faced a business riddled with problems including outdated equipment, inefficiency, and industrial disputes. Safety was a mess, and two people had lost their lives at work the previous year. Many of the injuries occurred during unplanned maintenance when the production line went down.
Rather than introduce more procedures, rules and protective equipment, Max searched for better ways. He brought together people from production, planning and maintenance to address the fundamental problem – how can we stop the breakdowns in the first place? By moving to planned, preventative maintenance, Fibremakers removed the risk, stopped the injuries, improved uptime and productivity.
On face value, measuring safety seems easy. We’re trying not to hurt people, so the proof is in the injury rates. Unfortunately, these measures can discourage reporting and hide underlying problems. Many disasters have occurred on sites celebrated for their injury free performance. Leaders need to monitor their injuries, but leading improvement requires better measures.
Good indicators reflect the foundations of safe and efficient performance. They reflect whether people are actively involved in applying systems, managing risk and learning from incidents. They give insight into whether risk controls are available, in use and effective.
Lead indicators allow managers to have frequent and proactive discussions on how we’re tracking and what we can adjust. The focus is on improving the underlying drivers of excellence, rather than fiddling the numbers or assuring people up the line that ‘things are okay.’ Warning signs prompt curiosity and enquiry. Managers become attuned to weak signals that may indicate problems, and can act before they result in injury.
The next steps
Integrating safety is a powerful way to build culture, embrace operational excellence and achieve great business outcomes. LJM Group has helped many organisations to apply these concepts and make a step change in safety performance and beyond. Contact us to support your journey.