Enterprise safety management (ESM) is a framework for achieving an injury-free workplace. The ESM framework creates an innovative, excellence driven, business focused approach to addressing challenges in the safety management process.
The framework starts with a culture that has a vision and goals for excellence, incorporates leadership, requires win/win thinking, fosters empathic communication, and instills continuous improvement. These basic principles aligned with sound business practices create the basis for a highly effective approach to managing the safety process.
Enterprise safety management (ESM) gives the enterprise a unique agility to respond to adverse situations because of the total alignment of incorporating an injury-free workplace (IFW) into the organizational fabric and a universal integration of all operations and systems. What is unique about ESM is the breadth of its vision. Once ESM is implemented, it does not stop. The real value of ESM becomes evident when it becomes an integrated and fully aligned part of the business enterprise. Compliance with safety standards and the reduction of the cost of risk are a byproduct of ESM, not the focus of it.
ESM represents a fundamental shift in the way businesses can approach providing an injury-free workplace for its employees. The present global orientation and economic reality dictates the need to manage effectively and efficiently. The cost of risk is one area that can benefit from the use of the ESM process. ESM also contributes to effectively managing organizational risk, fosters integrated decision-making, assists in streamlining operations, improves communication, and positively impacts the bottom line.
So what is ESM and how does it work? Some of the underlying principles, practices, definitions, and/or impact of ESM include the following.
An integrated view of the ESM process. Many organizations are vertically organized into functional departments or silos. These departments or functions may have their own "language," processes, expertise, metrics, and goals. These "differences" may create a physical and/or mental separation between departments of an organization. ESM is an integrated system, with an IFW as a catalyst for managing employee safety across an entire organization. It looks at how various organizational functions, such as estimating, purchasing, procuring, scheduling, operations, logistics, etc., creates the environment, or influences the employee's perceptions, behavior, and/or decision-making.
A bottom-line view of ESM. The adverse effect of injury and/or losses, as well as the cost of risk, is always viewed in terms of its impact on all aspects the whole organization, and not in terms of exposures, incidents, or worker injuries.
A safety process view of ESM. The successful implementation of IFW is facilitated by a senior executive office that provides the "champion," leadership, expert staff, internal alignment, and resources usually not available to safety. One might argue that if you don't have an IFW office, you are going to struggle with ESM.
A longitudinal view of ESM. The management of the risk associated with worker safety is an ongoing activity and behavior, and not a scheduled process, focused activity, or priority program.
A lean-thinking view of ESM. ESM advocates process efficiency and a value stream focus. It builds on cross-functional integration and waste elimination through a holistic view of the value stream. To truly achieve an IFW, contractors must look to influencing their partners, vendors, suppliers, as well as the owner and the design team to think in holistic terms.
ESM is not new. It springs from a linage of related proven processes employed by enterprise risk management, which draws on the quality movement of the 1970s, when manufacturers adopted quality standards that paved the way to better production and the subsequent lean enterprise thinking further improved the process. ESM addresses risk within organizational systems, business procedures, and operational processes, and minimizes risk across the whole organization through the collaboration of leaders from different departments.
ESM creates a powerful mechanism for improving business performance. It tends to be a vehicle for getting all levels of management and the workforce involved in something that is universally valued, operationally important, impacts general health and welfare, and results in a safe work environment. The workforce wants a place that is safe and protects their health. The first line supervisor wants a workforce that is engaged and meets the daily production goals. Middle mangers want to achieve the project's schedule and budget requirements and depend on the workforce being productive. Senior management wants the project to be profitable. This can only be accomplished by the best efforts of all levels, including the lowest tier's. So, in a way, ESM creates the framework for a "win-win-win-win" situation.
ESM also has a direct impact on profitability by controlling the cost of risk. A recent study by the University of Tennessee of a large population of contractors indicated that approximately 6-7 percent of the estimated cost of construction goes into insurance (loss) and safety related expenses and costs. These same contractors reported a 1.5 percent profit from their operations. It would seem rather obvious that even a small reduction in the insurance expenses and/or safety costs would significantly improve these contractors' profit picture. Though contractors understand this, they do not have a clear picture of how to go about changing this reality.
Historical Perspective
There are many good reasons for this dilemma. Some are historical, functional, operational, evolutionary, developmental, legislative, through poor assumptions, misdirected research, etc. Human motivation is a complex matter! Traditional safety management involves complying with the governing safety standards as promulgated by the state or federal jurisdictions. Therefore, most safety programs, processes, and procedures follow these standards, with a primary focus on compliance.
There is also the prevailing understanding that following these standards will create a safe work environment. That is really not strictly true. One only needs to look at the trigger height of fall protection to find that it varies from 6 to 25 feet for different kinds of (trades) work. Gravity does not differentiate on the basis of trade; mass times acceleration is a universal law of physics.
The basic structure of most safety programs goes back to the three Es. This was created by the National Safety Council as a simplification of Heinrich's 10 axioms for safety management. The three Es include: engineering solutions, education, and enforcement. Virtually all the safety standards fall into one of these categories. The engineering solutions address the physical conditions and the protection of employees from exposure to hazards in their physical environment. Education deals with providing the employee with training about the standards and the use of the protective system. And, of course, enforcement deals with site inspections and getting the workers to comply with the safety standards.
As a result, safety has been vertically organized and managed. It has its own rules, metrics, practices, language, and procedures. These do not necessarily mesh with those used by the other departments within the construction company. Many construction companies are vertically organized as well. In a construction firm, there is a marketing function, an estimating department, a purchasing/procurement department, a cost department, an operations department, and all the other necessary supporting departments such as accounting, HR, legal, etc. So, a vertically organized safety department "fits" into this mix. But safety has to be managed functionally (cross-departmentally). The way things are done, commitments made, plans instituted, etc., may impact the choices the individual worker makes on a daily basis which may increase the residing risks within the organizational systems. This can only be addressed by an enterprise-wide safety process.
Another historic reason for this disconnect is that the learning model in construction historically (over hundreds of years) has been working in a trade under the guidance of a master builder and over a "long" period of time acquiring the experience to "build it right," and to some degree to do it safely. Projects sometimes took decades with the same workforce (more or less) doing similar things in the same location for the same "owner." In the last 100 years or so, things have changed dramatically and the traditional learning model is inoperable. Modern safety management requires the use of tools and techniques that are not found while working at one's trade. By this, I mean you can pour a million yards of concrete and not come across any culture, or behavior or leadership concepts. To truly influence safe performance, concepts outside of the traditional safety and building process must be applied.
Path to Excellence
The path to safety excellence evolves from virtually no management of the safety function through compliance to the safety standards, to safety becoming a priority, to it becoming a value, and ultimately to it becoming instinctual. At the instinctual level, safety becomes an integral part of operations and business practices. It becomes how things are done and how people act. There are no questions as to choosing between working safely or not. Every decision made has safety in mind.
Upon reaching the instinctual level, organizations stop thinking in traditional terms of hazards and exposures, but instead about risk. Not just risk as it relates to the physical environment, but also about risks that reside in the operational processes, risks that reside in the business procedures, and risks that reside within the organizational systems. The risk focus also addresses the organizational tolerance of risk and communicates this to its entire workforce and staff. It also addresses the perception of risk and defines what is acceptable and what is not. Risk is then analyzed to determine if it is acceptable and manageable or unacceptable. This is clearly communicated to all the organization's employees. Effort is then expended in understanding the manageable risks and getting them to as low a level as it is economically and ethically feasible possible so as to create a business advantage.
Evolution of Safety
With ESM, projects or departments assess risk and factor IFW requirements into their planned activities. Going though the ESM process provides more value than the end product, as the process may identify hidden risks, expose interdepartmental barriers, and inefficiencies that were not recognized; thereby enabling mangers to make "better" decisions. The adoption of ESM does not mean more work, additional effort, or bureaucratic systems to administer; it is a new and different approach to work or project execution.
Foundational Elements
The foundational elements of ESM include a value-based culture, information, and metrics.
Value-Based Culture
The most elemental aspect of ESM is the organization's culture. The culture is what defines and guides the organization and its members. The culture must value safety and an injury-free workplace for its employees. Everyone shares an overriding vision of ESM and the achievement of IFW. There has to be a clear articulation of a strategy that will enable the members of the organization to achieve an injury-free workplace. The key elements of value-based culture are:
IFW as a deeply held instinctual value
Clear articulation of the organizational values and vision
Group commitment to a common purpose
Leader-member trust and respect
Organizational justice
A clear strategy for achieving ESM and IFW
Values say a lot about the organization. An organization's values are manifested in the actions and behaviors of management and employees. Consider these often too common misconceptions:
It is not acceptable to have to work 60-80 hours to pull one's weight.
Risk taking is only rewarded when you win.
Failure is unacceptable, even when you learn from it.
Safety is only important because it costs money when accidents occur.
Management hires bright people who know how to beat the system.
Competitors are stupid and are rarely better than we are.
People that quit our company are generally ones we don't mind losing.
We don't believe in communicating much with our employees about the company's future because they won't understand it.
We are a for-profit organization which culture will not support or achieve excellence in any respect or category, let alone safety!
In a value-based organizational culture, everyone leads from core principles and contributes to safe operations. For the organization to achieve an injury-free workplace, it must have a vision of achieving this state. For the vision to become reality, the organization must have a strategy for doing so. This strategy must be clearly articulated and communicated to the members of the organization. For the strategy to work, the organization must have the "right" people, doing the "right" things, resources to support the effort, and adopt objectives, targets, and metrics to drive the "right" behaviors. These will drive the process and the organizational behaviors to achieve an injury-free workplace.
Communication and Metrics
Organizations must measure to manage. In safety, measurement is accomplished by calculating loss frequency, severity, or Occupational Safety and Health Act (OSHA) recordable rates. These calculated results are compared to published Bureau of Labor Statistics values to see how the organization compares to industry averages. The effectiveness of the organization's safety efforts are measured in terms of cost of risk related to production, sales, man-hours worked, or as a percentage of payroll. Corrective action strategies are deployed based on an analysis of past losses. These metrics do not provide real-time information with which to manage since they are historical, may not accurately predict future risks, and do not indicate what exactly is driving the losses.
Typically, strategies to improve safety performance start with a review of past losses. This analysis then establishes the interventions for the coming year. These interventions usually consist of more training, emphasis of certain program elements, or more rigorous inspections. In the short term, some improvement is inevitable, but in the long run, the results never live up to expectations. Some of this is because the improvement strategy is based on history, and the future is never exactly the same as the past. The data analyzed may not give a true picture of all the contributing causes or identify the underlying risks. The focus in traditional safety is on the worker and not on the organizational system, business processes, operational procedures, and/or leadership and culture.
Data is analyzed, related to a context to create information. Information is used to deploy strategy. Information is valuable if it predicts future performance and results as well as indicating in real-time what the proper interventions should be, where to apply them, and at what rate. So the metrics need to be derived from the "working" organizational systems, processes, and procedures. There are a number of types of metrics that will provide useful information. These include input, output, process, progress, and outcome measures. Input, progress, and process measures are predictive and provide information with which the affect change. Outcome and output measures are historical and indicate results, affirming whether the interventions have in fact worked or not.
Safety performance information must be communicated to all the organization's employees on a regular basis. Employees need to know that their behavior and decisions impact safety performance. They need to see how their efforts impact the safety outcome metrics. Supervisors and managers also need to have this information so that they may monitor performance and mange the results.
Opinions expressed in Expert Commentary articles are those of the author and are not necessarily held by the author's employer or IRMI. Expert Commentary articles and other IRMI Online content do not purport to provide legal, accounting, or other professional advice or opinion. If such advice is needed, consult with your attorney, accountant, or other qualified adviser.
Enterprise safety management (ESM) is a framework for achieving an injury-free workplace. The ESM framework creates an innovative, excellence driven, business focused approach to addressing challenges in the safety management process.
The framework starts with a culture that has a vision and goals for excellence, incorporates leadership, requires win/win thinking, fosters empathic communication, and instills continuous improvement. These basic principles aligned with sound business practices create the basis for a highly effective approach to managing the safety process.
Enterprise safety management (ESM) gives the enterprise a unique agility to respond to adverse situations because of the total alignment of incorporating an injury-free workplace (IFW) into the organizational fabric and a universal integration of all operations and systems. What is unique about ESM is the breadth of its vision. Once ESM is implemented, it does not stop. The real value of ESM becomes evident when it becomes an integrated and fully aligned part of the business enterprise. Compliance with safety standards and the reduction of the cost of risk are a byproduct of ESM, not the focus of it.
ESM represents a fundamental shift in the way businesses can approach providing an injury-free workplace for its employees. The present global orientation and economic reality dictates the need to manage effectively and efficiently. The cost of risk is one area that can benefit from the use of the ESM process. ESM also contributes to effectively managing organizational risk, fosters integrated decision-making, assists in streamlining operations, improves communication, and positively impacts the bottom line.
So what is ESM and how does it work? Some of the underlying principles, practices, definitions, and/or impact of ESM include the following.
ESM is not new. It springs from a linage of related proven processes employed by enterprise risk management, which draws on the quality movement of the 1970s, when manufacturers adopted quality standards that paved the way to better production and the subsequent lean enterprise thinking further improved the process. ESM addresses risk within organizational systems, business procedures, and operational processes, and minimizes risk across the whole organization through the collaboration of leaders from different departments.
ESM creates a powerful mechanism for improving business performance. It tends to be a vehicle for getting all levels of management and the workforce involved in something that is universally valued, operationally important, impacts general health and welfare, and results in a safe work environment. The workforce wants a place that is safe and protects their health. The first line supervisor wants a workforce that is engaged and meets the daily production goals. Middle mangers want to achieve the project's schedule and budget requirements and depend on the workforce being productive. Senior management wants the project to be profitable. This can only be accomplished by the best efforts of all levels, including the lowest tier's. So, in a way, ESM creates the framework for a "win-win-win-win" situation.
ESM also has a direct impact on profitability by controlling the cost of risk. A recent study by the University of Tennessee of a large population of contractors indicated that approximately 6-7 percent of the estimated cost of construction goes into insurance (loss) and safety related expenses and costs. These same contractors reported a 1.5 percent profit from their operations. It would seem rather obvious that even a small reduction in the insurance expenses and/or safety costs would significantly improve these contractors' profit picture. Though contractors understand this, they do not have a clear picture of how to go about changing this reality.
Historical Perspective
There are many good reasons for this dilemma. Some are historical, functional, operational, evolutionary, developmental, legislative, through poor assumptions, misdirected research, etc. Human motivation is a complex matter! Traditional safety management involves complying with the governing safety standards as promulgated by the state or federal jurisdictions. Therefore, most safety programs, processes, and procedures follow these standards, with a primary focus on compliance.
There is also the prevailing understanding that following these standards will create a safe work environment. That is really not strictly true. One only needs to look at the trigger height of fall protection to find that it varies from 6 to 25 feet for different kinds of (trades) work. Gravity does not differentiate on the basis of trade; mass times acceleration is a universal law of physics.
The basic structure of most safety programs goes back to the three Es. This was created by the National Safety Council as a simplification of Heinrich's 10 axioms for safety management. The three Es include: engineering solutions, education, and enforcement. Virtually all the safety standards fall into one of these categories. The engineering solutions address the physical conditions and the protection of employees from exposure to hazards in their physical environment. Education deals with providing the employee with training about the standards and the use of the protective system. And, of course, enforcement deals with site inspections and getting the workers to comply with the safety standards.
As a result, safety has been vertically organized and managed. It has its own rules, metrics, practices, language, and procedures. These do not necessarily mesh with those used by the other departments within the construction company. Many construction companies are vertically organized as well. In a construction firm, there is a marketing function, an estimating department, a purchasing/procurement department, a cost department, an operations department, and all the other necessary supporting departments such as accounting, HR, legal, etc. So, a vertically organized safety department "fits" into this mix. But safety has to be managed functionally (cross-departmentally). The way things are done, commitments made, plans instituted, etc., may impact the choices the individual worker makes on a daily basis which may increase the residing risks within the organizational systems. This can only be addressed by an enterprise-wide safety process.
Another historic reason for this disconnect is that the learning model in construction historically (over hundreds of years) has been working in a trade under the guidance of a master builder and over a "long" period of time acquiring the experience to "build it right," and to some degree to do it safely. Projects sometimes took decades with the same workforce (more or less) doing similar things in the same location for the same "owner." In the last 100 years or so, things have changed dramatically and the traditional learning model is inoperable. Modern safety management requires the use of tools and techniques that are not found while working at one's trade. By this, I mean you can pour a million yards of concrete and not come across any culture, or behavior or leadership concepts. To truly influence safe performance, concepts outside of the traditional safety and building process must be applied.
Path to Excellence
The path to safety excellence evolves from virtually no management of the safety function through compliance to the safety standards, to safety becoming a priority, to it becoming a value, and ultimately to it becoming instinctual. At the instinctual level, safety becomes an integral part of operations and business practices. It becomes how things are done and how people act. There are no questions as to choosing between working safely or not. Every decision made has safety in mind.
Upon reaching the instinctual level, organizations stop thinking in traditional terms of hazards and exposures, but instead about risk. Not just risk as it relates to the physical environment, but also about risks that reside in the operational processes, risks that reside in the business procedures, and risks that reside within the organizational systems. The risk focus also addresses the organizational tolerance of risk and communicates this to its entire workforce and staff. It also addresses the perception of risk and defines what is acceptable and what is not. Risk is then analyzed to determine if it is acceptable and manageable or unacceptable. This is clearly communicated to all the organization's employees. Effort is then expended in understanding the manageable risks and getting them to as low a level as it is economically and ethically feasible possible so as to create a business advantage.
Evolution of Safety
With ESM, projects or departments assess risk and factor IFW requirements into their planned activities. Going though the ESM process provides more value than the end product, as the process may identify hidden risks, expose interdepartmental barriers, and inefficiencies that were not recognized; thereby enabling mangers to make "better" decisions. The adoption of ESM does not mean more work, additional effort, or bureaucratic systems to administer; it is a new and different approach to work or project execution.
Foundational Elements
The foundational elements of ESM include a value-based culture, information, and metrics.
Value-Based Culture
The most elemental aspect of ESM is the organization's culture. The culture is what defines and guides the organization and its members. The culture must value safety and an injury-free workplace for its employees. Everyone shares an overriding vision of ESM and the achievement of IFW. There has to be a clear articulation of a strategy that will enable the members of the organization to achieve an injury-free workplace. The key elements of value-based culture are:
Values say a lot about the organization. An organization's values are manifested in the actions and behaviors of management and employees. Consider these often too common misconceptions:
In a value-based organizational culture, everyone leads from core principles and contributes to safe operations. For the organization to achieve an injury-free workplace, it must have a vision of achieving this state. For the vision to become reality, the organization must have a strategy for doing so. This strategy must be clearly articulated and communicated to the members of the organization. For the strategy to work, the organization must have the "right" people, doing the "right" things, resources to support the effort, and adopt objectives, targets, and metrics to drive the "right" behaviors. These will drive the process and the organizational behaviors to achieve an injury-free workplace.
Communication and Metrics
Organizations must measure to manage. In safety, measurement is accomplished by calculating loss frequency, severity, or Occupational Safety and Health Act (OSHA) recordable rates. These calculated results are compared to published Bureau of Labor Statistics values to see how the organization compares to industry averages. The effectiveness of the organization's safety efforts are measured in terms of cost of risk related to production, sales, man-hours worked, or as a percentage of payroll. Corrective action strategies are deployed based on an analysis of past losses. These metrics do not provide real-time information with which to manage since they are historical, may not accurately predict future risks, and do not indicate what exactly is driving the losses.
Typically, strategies to improve safety performance start with a review of past losses. This analysis then establishes the interventions for the coming year. These interventions usually consist of more training, emphasis of certain program elements, or more rigorous inspections. In the short term, some improvement is inevitable, but in the long run, the results never live up to expectations. Some of this is because the improvement strategy is based on history, and the future is never exactly the same as the past. The data analyzed may not give a true picture of all the contributing causes or identify the underlying risks. The focus in traditional safety is on the worker and not on the organizational system, business processes, operational procedures, and/or leadership and culture.
Data is analyzed, related to a context to create information. Information is used to deploy strategy. Information is valuable if it predicts future performance and results as well as indicating in real-time what the proper interventions should be, where to apply them, and at what rate. So the metrics need to be derived from the "working" organizational systems, processes, and procedures. There are a number of types of metrics that will provide useful information. These include input, output, process, progress, and outcome measures. Input, progress, and process measures are predictive and provide information with which the affect change. Outcome and output measures are historical and indicate results, affirming whether the interventions have in fact worked or not.
Safety performance information must be communicated to all the organization's employees on a regular basis. Employees need to know that their behavior and decisions impact safety performance. They need to see how their efforts impact the safety outcome metrics. Supervisors and managers also need to have this information so that they may monitor performance and mange the results.
See Enterprise Safety Management: Creating a Framework for more information about the foundation and framework of enterprise safety management.
Opinions expressed in Expert Commentary articles are those of the author and are not necessarily held by the author's employer or IRMI. Expert Commentary articles and other IRMI Online content do not purport to provide legal, accounting, or other professional advice or opinion. If such advice is needed, consult with your attorney, accountant, or other qualified adviser.