Opinion

Take it from the top

Global managing partner, safety transformation, ERM

Findings from ERM’s global safety survey show that safety leaders across industry sectors identify leadership engagement as the key to unlocking safety culture and performance improvement. 

Engagements with 144 safety functional leaders representing major corporations operating across a broad range of industry sectors have revealed a broad-based consensus that there is an uplift in stakeholder expectations on safety.

These deeply informed individuals were virtually unanimous in their belief that stakeholders will continue to drive increased pressure on safety in the coming years. This pressure will raise the bar on performance expectations and the penalties for organisations and their leaders who fail to meet these expectations will continue to rise. These developments appear to have caused a spike in senior leadership interest and substantial ongoing investment in safety: equivalent to 17.5% of labour costs on average. 

However, despite the scale of this investment, significant performance challenges remain, especially with regards to continuing occurrence of serious injuries and fatalities. Companies are planning further increases in investments in safety over the next few years, but there is a growing sense that more of the same will not deliver the desired outcomes as traditional approaches to safety may be impeding progress. 

The engagement of leaders at all organisational levels on the frontline is the key to improving safety culture and performance

 

These and other insights were taken from global sustainability consulting company ERM’s first Global Safety Survey, which was designed to explore if there is a shift in perceptions on safety, and to bring fresh insight into the implications of these developments for organisational leaders and their safety functions. 

Between January and July 2018, ERM undertook structured interviews with safety functional leaders (72% global directors of safety, VPs or higher) from organisations who employ a total of 6.8 million employees and with combined revenues of $4.3trn. All were key decision makers, and most brought a global perspective from their roles and their organisations. Most of the organisations were multinationals with substantial employee and contractor bases located across multiple countries.

A number of insights emerged. However, perhaps most crucially, it was that the best outcomes will be achieved not by doing more on safety but by extracting more value from established processes and programmes, and that the engagement of leaders at all organisational levels on the frontline is the key to improving safety culture and performance. 

The nine key findings are as follows:

Stakeholder expectations are rising. Interviewees expressed a near unanimous view that stakeholder expectations for improved safety performance will increase in all sectors and across all continents over the next three years.

Companies are increasing their investment. Predictably, given the increased pressure and scrutiny from stakeholders, the survey found that respondents have ratcheted up their efforts to enhance their safety culture and performance in recent years. The vast majority of organisations are also planning to increase their investment over the next three years.

Significant cultural and performance challenges remain. Despite organisations increasing their level of effort on safety and most reporting improved performance, the majority are dissatisfied with both their safety culture and performance.

Risk continues to shift to contractors, who are harder to manage. Organisations are relying more and more on contractors, who often perform more hazardous activities and are more challenging to manage.

Most companies do not understand how much they are investing in safety. Few respondents had considered the scale of their total economic investment in safety and some were uncomfortable with this line of questioning.

Lagging performance indicators remain dominant. The data indicates that few companies are using meaningful leading indicators to evaluate the efficacy of their safety processes and programmes. This is surprising given the scale of companies’ investments.

Established safety processes and programmes are not delivering sufficient impact on performance. Changes in investments in safety over the past three years had no bearing on performance improvement. There is a positive correlation between hours of training provided and perceptions of safety culture. Investing in training seems to have a positive impact on culture. However, the Institute of Environmental Analytics at Reading University, UK found statistical evidence in the data that the quality of training provided is a better predictor of perceived performance than the number of hours of training provided.

Harnessing data and technology to improve safety is becoming a major focus.  Organisations recognise the benefits that data and technology can bring in the drive to improve safety performance and it has been identified as a strategic priority, but it has not yet translated into an investment priority.

Leadership engagement is key, but leaders need to step up and gain new skills. The respondents broadly recognised leadership engagement on the frontline as the key to improving safety culture and performance; however, leaders are not sufficiently present in the field and they aren’t as effective as they could be when they are there.

Leaders can use the insights from this research to challenge their own organisations to: 

  • Better understand the total scale of their economic investment in safety.
  • Routinely evaluate if all their key safety processes and programmes are impacting on culture and behaviours by asking, “Could our effort be better deployed in a way that would create greater impact?”.
  • Direct future investments to enhance the value which is derived from established safety processes and programmes, so these don’t become a tick-box activity. That means ensuring that processes are fit-for-purpose and using smarter user-friendly tools (less words more pictures) to ensure critical requirements are better understood by the users on the sharp end, at the point of use. It also requires leaders to take action to breathe life into their safety processes and programmes.
  • Make people the primary focus: people on the frontline, including contractors, design engineers, procurement staff, and other key office-based personnel whose actions directly impact occupational and process safety outcomes.
  • Accelerate their plans to harness data for enhanced decision-making and new technology to de-risk their operations.
  • Better recognise that all leaders, from the CEO to frontline leaders, play an absolutely crucial role in defining the safety culture and performance of their organisations through their behaviours and the decisions they make every day. Seventy-five percent of the survey respondents identified leadership engagement as the key to driving improvement in safety performance and it emerged as the number one focus for investment in the next three years. This is a great opportunity to coach leaders so their engagements in the office and on the frontline are more impactful (a need identified by 71% of the respondents). It is also an opportunity to equip leaders with the skills to breathe life into their processes and programmes, so these deliver much greater impact on safety culture, behaviours and performance on the frontline.

The full report can be found here.

 

Global managing partner, safety transformation, ERM

Comments

  • Mmmm - funny that a cons

    Permalink Submitted by Bob Higgins on 3 May 2019 - 02:09 pm

    Mmmm - funny that a consulting company delivering leadership consulting and training, asked Leadership how important leadership was and the conclusion was that Leadership was most important but that those leaders need more/better training in safety leadership... do you think they know anyone who could provide this service??
    There's nothing really new here, management consulting firms have been flogging this for years.

    reply

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