Proving the Value of your Safety Programs
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Proving the Value of your Safety Programs Fluctuating commodity prices have a direct impact on business results. An extended period of low prices can lead to cutbacks and closer budget scrutiny. As Safety professionals, you can’t control commodity prices, but you can demonstrate that continued investment in safety makes good business sense. Even when struggling to meet increasing regulatory burdens with stretched resources, safety directors have to be prepared to prove that they are making a measurable impact, both in terms of company finances and keeping employees safe and healthy. In this deck, Stephanie Stokes, MPH, BSIH will discuss the challenges safety teams face in justifying their value, the importance of accurately tracking metrics, and outline how to demonstrate the return on investment of your safety programs. Read this deck and learn: Which key metrics you should be tracking. How to effectively engage stakeholders and communicate the benefits of your safety programs. How to leverage risk analysis to effectively allocate resources. How EHS software makes monitoring and reporting easier, through automation and integration. How to measure ROI. Stephanie Stokes is Client Success Manager at Medgate, providing post go-live client support services such as training, auditing and service requests. Stephanie’s broad experience in the EHS field allow her to support clients by resolving functional issues, providing best practice and alternative solutions. Stephanie brings 20 years of Industrial Hygiene, Safety and Environmental experience to Medgate. She has worked in a broad range of industries including pulp & paper, biotech, chemical and most recently pharmaceuticals. Stephanie earned her Bachelor of Science in Industrial Hygiene from Ohio University in 1998 and a Master of Public Health from University of South Florida in 2011. Stephanie is currently certified in Public Health by the National Board of Public Health Examiners and is working to obtain her Certified Industrial Hygienist designation. Stephanie is an active member of the American Industrial Hygiene Association.
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Proving the Value of your Safety Programs
- 1. Enterprise EHS Software Solutions
- 2. Enterprise EHS Software Solutions ONE OF OUR IN-HOUSE EXPERTS AT MEDGATE… WITH 20 YEARS OF INDUSTRIAL HYGIENE, SAFETY AND ENVIRONMENTAL EXPERIENCE, STEPHANIE HAS WORKED IN PULP & PAPER, BIOTECH, CHEMICAL & PHARMACEUTICALS A PRESENTATION BY STEPHANIE STOKES
- 3. Enterprise EHS Software Solutions WHY DO SAFETY TEAMS NEED TO PROVE THEIR VALUE?
- 4. Enterprise EHS Software Solutions THIS SLIDE DECK SUPPORTS THE WEBINAR: PROVING THE VALUE OF YOUR SAFETY SYSTEMS, WHICH YOU CAN VIEW ON- DEMAND AT: HTTP://WWW2.MEDGATE.COM /SAFETYROISLIDESHARE
- 5. Enterprise EHS Software Solutions COMMODITY PRICES & MARKET FLUCTUATIONS MEAN THAT ALL TEAMS HAVE TO JUSTIFY THEIR BUDGETS - OIL PRICE DEPRESSED SINCE SUMMER OF 2014
- 6. Enterprise EHS Software Solutions THERE ARE OFTEN HUGE COSTS ASSOCIATED WITH SAFETY INCIDENTS, WHICH IMPACT ON BUSINESSES’ BOTTOM LINES
- 7. Enterprise EHS Software Solutions DIRECT COSTS WORKER’S COMP PREMIUM PENALTIES & FINES INDIRECT COSTS COST OF INVESTIGATION OVERTIME BECAUSE OF ACCIDENT HIRING & TRAINING REPLACEMENT COST OF REPAIR OR DAMAGE TO EQUIPMENT LOST PRODUCTIVITY LOWER STAFF MORALE ADMINISTRATIVE COSTS LOSS OF GOODWILL AND REPUTATIONAL DAMAGE
- 8. Enterprise EHS Software Solutions INDIRECT COSTS OUTWEIGH DIRECT COSTS BY 4 1:
- 9. Enterprise EHS Software Solutions BECAUSE OF THESE COSTS, SAFETY IS A HIGH PROFILE SUBJECT WITH LOTS OF INTERESTED STAKEHOLDERS
- 10. Enterprise EHS Software Solutions SAFETY TEAM EMPLOYEES EHS COLLEAGUES – OCCUPATIONAL HYGIENE, INDUSTRIAL HYGIENE, ENVIRONMENTAL SAFETY COMMITTEE INVESTORS CUSTOMERS GOVERNMENT AGENCIES (FEDERAL OR STATE) THIRD-PARTY VENDORS & SUPPLY CHAIN REGULATORY AGENCIES (OSHA, NIOSH) UPPER MANAGEMENT SAFETY MANAGERS INTERNAL EXTERNAL
- 11. Enterprise EHS Software Solutions WHAT CHALLENGES DO SAFETY TEAMS FACE?
- 12. Enterprise EHS Software Solutions 1. DISENGAGED STAKEHOLDERS 2. LIMITED MANPOWER 3. INTANGIBLE SUCCESSES
- 13. Enterprise EHS Software Solutions 1. DISENGAGED STAKEHOLDERS safety needs to be front of mind it’s a question of priorities – get management buy in early 2. LIMITED MANPOWER 3. INTANGIBLE SUCCESSES
- 14. Enterprise EHS Software Solutions 1. DISENGAGED STAKEHOLDERS 2. LIMITED MANPOWER you can reduce double effort and plan your resources smarter with a data management system 3. INTANGIBLE SUCCESSES
- 15. Enterprise EHS Software Solutions 1. DISENGAGED STAKEHOLDERS 2. LIMITED MANPOWER 3. INTANGIBLE SUCCESSES be prepared to present your success data for all your programs – not just the headlines
- 16. Enterprise EHS Software Solutions OVERCOMING YOUR CHALLENGES
- 17. Enterprise EHS Software Solutions PLAN DOCHECK ACT CONTINUOUS IMPROVEMENT
- 18. Enterprise EHS Software Solutions PLAN: MAP OUT YOUR PROGRAM LIFECYCLE
- 19. Enterprise EHS Software Solutions QUANTITATIVE AND QUALITATIVE ANALYSIS INTERPRET RESULTS AND DRAW CONCLUSIONS REPORTS AND COMMUNICATION OF RESULTS ANALYSIS AND REPORTING MEASURE BASELINE VALUES AND ANY POSSIBLE VARIABLES MEASURE VALUES OF OUTCOME AND VARIABLES TO DETERMINE SUCCESS DEPLOYMENT REVIEW BEST PRACTICES DEVELOP MODEL SPECIFY EVALUATION CRITERIA AND METRICS SELECT ANALYTICAL METHOD PLANNING AND DEVELOPMENT IDENTIFY PROBLEM AREA DECIDE TO EVALUATE DEFINE PURPOSE, TIMELINE, BUDGET ASSEMBLE COMMITTEE OF STAKEHOLDERS IDENTIFYING PROBLEMS
- 20. Enterprise EHS Software Solutions PLAN: DETERMINE WHERE TO INTERVENE FOR MAXIMUM IMPACT
- 21. Enterprise EHS Software Solutions ORGANIZATIONAL CHANGES – POLICIES/STRUCTURES TECHNICAL CHANGES – PROCESS CHANGES, ENGINEERING CHANGES, HARDWARE CHANGES HUMAN CHANGES – TRAINING, ATTITUDE, MOTIVATION, BEHAVIOR
- 22. Enterprise EHS Software Solutions PLAN: DECIDE HOW YOU WILL MEASURE OUTCOMES
- 23. Enterprise EHS Software Solutions EVALUATION VALUE NEEDS ASSESSMENT ENSURES YOUR PROGRAMS FOCUS IN THE RIGHT AREA PROCESS EVALUATION IMPROVES DELIVERY OF SAFETY PROGRAMS EFFECTIVENESS EVALUATION LOOKS AT IMPACT OF PROGRAMS, WHETHER THEY MEET THEIR TARGETS, SHOWS SIZE OF EFFECT COST-OUTCOME NET COST OF OUTCOME RELATIVE TO HEALTH IMPACT COST BENEFITS COMPARES DIFFERENT BENEFITS OF EACH ONE
- 24. Enterprise EHS Software Solutions WHEN DESIGNING YOUR PROGRAM, ENSURE YOU SET UP A FAIR TEST
- 25. Enterprise EHS Software Solutions BEFORE AND AFTER Pros • Easiest to set up • Useful for showing impacts of short-term, simple projects Cons • Most susceptible to outside influence & drawing false conclusions – especially over longer-term projects OR…EXPERIMENTAL • Control group and random selection of subjects increases validity of results • Requires extra resource and planning
- 26. Enterprise EHS Software Solutions HOW TO PROVE VALUE: MEASURING THE RESULTS
- 27. Enterprise EHS Software Solutions GET GOOD DATA RELIABILITY + VALIDITY = ACCURACY High Validity, high reliability Low Validity, high reliability Low Validity, low reliability High Validity, low reliability
- 28. Enterprise EHS Software Solutions INJURY RATES LEADING INDICATORS SURVEYS EQUIPMENT MEASUREMENTS & AUDITS ALL GIVE QUANTITATIVE DATA
- 29. Enterprise EHS Software Solutions FOCUS GROUPS OPEN-ENDED QUESTIONS IN QUESTIONNAIRES OBSERVATIONS OTHER MATERIALS ALL GIVE QUALITATIVE DATA
- 30. Enterprise EHS Software Solutions ONCE YOU HAVE THE DATA, COMMUNICATE THE RESULTS
- 31. Enterprise EHS Software Solutions SAFETY TEAM EMPLOYEES EHS COLLEAGUES – OCCUPATIONAL HYGIENE, INDUSTRIAL HYGIENE, ENVIRONMENTAL SAFETY COMMITTEE INVESTORS CUSTOMERS GOVERNMENT AGENCIES (FEDERAL OR STATE) THIRD-PARTY VENDORS & SUPPLY CHAIN REGULATORY AGENCIES (OSHA, NIOSH) UPPER MANAGEMENT SAFETY MANAGERS INTERNAL EXTERNAL LET YOUR STAKHOLDERS KNOW WHAT THE PROGRAMS ARE, HOW THEY ARE MONITORED, ANY IMPROVEMENTS MADE USING YOUR DATA
- 32. Enterprise EHS Software Solutions BE HONEST ABOUT NEGATIVE RESULTS AS THESE ARE OPPORTUNITIES FOR IMPROVEMENT
- 33. Enterprise EHS Software Solutions THIS SLIDE DECK SUPPORTS THE WEBINAR: PROVING THE VALUE OF YOUR SAFETY SYSTEMS, WHICH YOU CAN VIEW ON- DEMAND AT: HTTP://WWW2.MEDGATE.COM /SAFETYROISLIDESHARE
Editor's Notes
- Welcome to this installment of the Medgate Webinar series and thank you for joining us. Today’s webinar will be Justifying the existence of your Occupational Health Clinic
- Thanks David--Good morning first of all I would like to introduce myself
- Now, behind that poll question is the real issue at hand today – why do safety teams need to prove their value? And I think the answer to that question falls into two categories – firstly there are temporary factors which from time to time cause all teams in companies to tighten their belts and demonstrate the role they play to senior management and secondly there are more permanent issues that mean safety is an area that is always going to have people applying pressure.
- This webinar will consist of 3 parts. Part 1 Part 2 And, part 3 I’m David Poole and I’m your moderator today.
- Since the Summer of 2014, there has been a sustained period of falling or low oil prices which are impacting a large number of companies’ bottom lines. Companies are putting large investments on hold until the uncertainty is resolved around when or whether the price will return to the 2014 levels. Even when times are good, there could be another economic downturn just around the corner and no company is ever completely safe from some form of economic crisis – safety managers need to be prepared with information on what their programs achieve and how it provides value to the company.
- Here is a table showing direct and indirect costs. Often the analogy of an iceberg is used because of the amount of costs that are hidden from view. Read through table and add any comments about how much these can cost eg Workers comp premiums and penalties and fines are direct costs Indirect costs are: Cost of investigation Overtime because of the accident Hiring and training a replacement Costs of repairs or damage to equipment Lost productivity Lower staff morale Administrative costs Loss of goodwill and reputational damage
- The ratio of direct to indirect costs is, on average, 1:4. That means for every dollar of direct costs of an accident, a company will spend an additional $4 in indirect costs. This is just an average, the ratio can vary from 1 to 1 to as much as 1 to 20. One of the biggest indirect costs is the time taken to assess the damage, conduct the investigation, and complete the relevant forms.
- Looking at this chart (and it’s by no means exhaustive) reminds you of what a high profile issue safety is. So many different groups are looking at the results of your safety programs from so many different angles. Safety does not operate in a vacuum. It is a high profile department, especially when things go wrong. All of these stakeholders have an inherent interest in the success or failure of your programs and it is to them that you must prove your value, not just when budgets are tight, but as an integral part of how your team operates.
- It is clear that safety incidents cost money, but is it enough to stop there? Is it enough to say that because safety incidents cost that the company should be investing in your department? The answer is no. If it was it is clear from what we’ve already seen today that management should want to back their safety teams at all costs! As I think everyone on the line today can attest, it’s not that simple. Safety teams face a challenge in that when things go well and incidents are low or even non-existent, there is a tendency to forget lessons learned and expect that programs can be put on hold without negative consequences. To counter this, we as safety professionals need to be able to demonstrate exactly what impact each of our initiatives has had and over what timeframe. Not just in terms of injuries avoided and dollars saved, but by setting out at the beginning what the objectives are, how they will be measured, by when they will be achieved and who will be involved.
- For each program you are implementing you should be thinking about testing and proving its value. Not just so that you can justify your budgets to your management team, but so that you can allocate your resources in the most efficient way possible and so that you can see what are the most effective ways to improve safety in your organization. Each company is different and even within companies, some strategies will be more effective in some areas that others. Consider a global company - you are going to have some areas where the culture will mean that safety is always top of mind and has been for a long time already and others where safety is an emerging topic. The way that your strategy copes with each of these may have to be radically different. This is why knowing what the data showed before your program started and what is showed afterwards is going to be of such importance to you.
- I’m sure that this diagram will be familiar to many of you. It is the basis for the ISO continuous improvement feedback loop and the structure I will outline now for proving the value of your programs. Plan, do, check, act.
- Here is one model of how you can think about your programs. You may think that this looks like a lot of extra work, but by being strategic and spending time at this stage of your thinking, you will be able to save lots of time down the road by only rolling out the policies and programs that you can show to be effective before you spend too much time on them. In addition, you should be thinking in terms of your risk analysis. This should show you where you should focus first.
- When you are identifying problem areas, it may help to think in these terms to break down how you could approach different problems with different solutions to achieve your goals – sometimes a policy or structural change will make most sense, sometimes an engineering change and sometimes a human change such as additional training will be the most suitable solution. Often we think in terms of combinations of solutions, but when this happens it gets difficult to pinpoint exactly what was successful in achieving the goals.
- As well as different ways to create value, there are many different ways in which you can be measuring value. Run through needs assessments, process evaluation etc - the method you choose will be depend on your specifics. For example, if you safety program is fairly new and growing - you may consider a needs assessment to decide what you should be doing and where. This could include a risk analysis so that you can prioritize your tasks. If budgets are being cut and you need to prove that each dollar is being spent in the most efficient way then a cost-based analysis is going to be of interest, because at the end you should be able to show that you are using programs that get the most bang for your buck.
- If you want to be able to prove the impact of specific interventions, you should set up your planning in a scientific way so that you can show that you have run a test. There are two different levels you can choose here – a simple before and after test or a more complex experimental design. You will want to choose the one that suits the resources available to you.
- A before and after experiment is one where you take readings before and after the project begins and ends. If you don’t have the before data, it is impossible to prove any effect. The longer a project goes on, the more outside factors could be having an influence on what you are measuring, so the less certain you can be in your conclusions. Threats to the validity of before and after tests could include Outside influence (eg government programs raise profile of issue) deal with this by consulting other outside stats Instrumentation - measurement changes over time - don’t change the method Regression to the mean (not enough data to show true trends) need to measure over time and consider trends Testing - conducting a questionnaire may bring safety knowledge to front of mind before a program begins Placebo – your subjects may experience a placebo effect Maturation (eg experience of group increases naturally) With all of these, minimize the impact by consulting outside data to compare with your results
- One way to measure results is to obtain quatintitive data. However, that data must be reliable and valid. Reliability means getting consistent results (while measuring the same thing) on numerous occasions Validity means a low degree of systemic error, in other words, are we measuring what we had hoped to measure. When data is Both reliable and valid ,that means its accurate. The more accurate the data is, the better your results are, and thus improving the outcome of your program. Measurement error can impact on both reliability and validity and can be anything from not measuring what you thought you were measuring to values obtained on non-calibrated equipment. If measurements are not reliable, it is harder to detect any impact. For example, lost-time injury rate data (unless in very large workplaces) is often unreliable. Often additional outcomes must be measured to see the value of a program. If results are not valid, the conclusions you draw may be incorrect. You may be measuring a different thing that you thought you were. Or impacting in a different way. For example, your questionnaire questions may not accurately get the answers to the questions you wanted to ask or you may want to test people’s attitudes towards safety culture, but the test you design does not accurately cover this. Therefore, to be able to use the data you collect, it must be accurate with minimal measurement error.
- The final piece of this process is the communication of the results. If we go back to the
- Looking at this chart (and it’s by no means exhaustive) reminds you of what a high profile issue safety is. So many different groups are looking at the results of your safety programs from so many different angles. Safety does not operate in a vacuum. It is a high profile department, especially when things go wrong. All of these stakeholders have an inherent interest in the success or failure of your programs and it is to them that you must prove your value, not just when budgets are tight, but as an integral part of how your team operates.
- This webinar will consist of 3 parts. Part 1 Part 2 And, part 3 I’m David Poole and I’m your moderator today.