Expert Commentary

Managing Construction Risk through Pre-Operational Planning

Has anyone in your organization really stopped to analyze why your projects are experiencing disruptions, accidents, and losses? Why are workers getting hurt in spite of safety standards, programs, policies, procedures, training, and possibly everyone's best efforts? What can be done to reduce losses, control the cost of risk and optimize the bottom line?


Construction Safety
September 2006

These are important questions to address in a time when industry is under great pressure to increase efficiency, effectiveness and profitability.

In construction, typically safety is treated as a discrete and separate function within the contractor's organization. Much of what we do in safety revolves around incidents, accidents, and losses. We use programs and other strategies to help us control their adverse effects. We train our workers in accordance with safety standards. We measure our success in reduced incidents and by comparing our loss data to national statistics.

Our accidents and losses impact our cost of risk and ultimately our very competitiveness in a highly competitive industry. This also may well diminish our ability to market construction services and/or secure work. Accidents usually do not happen due to fate or intent on the worker's part. They happen because of ineffective processes, inadequate procedures, poor planning or lack of foresight. Therefore, we must get away from the predominantly worker-focused interventions common in the industry, and look into areas that the worker has little or no control over but are the underlying contributing causes of incidents and losses.

The industry's focus on the worker for resolution of its safety concerns is driven by historic precedent and the enactment of safety standards by the government. Back in the 1920s, Heinrich conducted a study of a large number of accidents and determined that 88 percent of the causes of those accidents resulted from "unsafe acts" by the workers. This was followed by a number of other studies where an even great percentage was attributed to the worker.

I recently heard a speaker at one of the national safety conferences state that virtually 100 percent of the cause of accidents was the unsafe acts of workers. The underlying assumption of these statements is that the worker has control over his/her actions and therefore can stop taking risks that may lead to an injury. But what this assumption ignores is that the worker has very little "power" over operations, compared to management. Figure 1 provides a graphic representation of "The Balance of Power."

Figure 1

The Balance of Power

So it becomes clear that management not only controls just about every planned activity on a construction site, but also has quite a bit of control over the worker. Management hires the worker, assigns the tasks, and oversees his/her actions. The supervisor can assess the workers knowledge, capabilities, actions, motivation, and other abilities to perform the assigned tasks. This same foreman can determine if this is acceptable or not and what should be done to eliminate any deficiencies. The foreman can also change the worker's assignment, coach, provide additional training or greater oversight, or decide remove the worker from the site. So by this example, management can exercise quite a bit of control over the workers actions as well. Therefore, the solution to the incident/accident/loss problem resides elsewhere in the operation.

One rather straightforward approach to making a significant inroad into addressing the incident/accident/loss picture is to look at a process that the contractor already has in place, is easy to modify, and highly effective in addressing this critical need.

Pre-Operational Planning

Planning is an integral part of contracting and the construction process. Virtually every aspect of contracting involves some form of planning. Successful contractors are generally effective planners. It is through planning that the appropriate materials are secured, delivered, and installed. It is though the process of planning that all the trades work harmoniously on the site. Without effective planning, all the diverse elements, aspects, and functions of construction would not come together to result in the final finished product—the building.

  • Pre-operational planning is the review of planned operations before and during the construction process to identify and eliminate potential sources of loss.

  • The goal of preplanning is to reduce hazards, which will minimize disruption, increase efficiency, and lower costs.

So, if incidents on the construction site cause disruptions and losses, then it begs the question, can we apply the fundamentals of planning to safety and therefore minimize these undesirable outcomes? Fortunately, the response is YES; so let's look at the planning process and see how we may affectively integrate safety management into the contractor's operational planning.

Why Preplan?

A research study conducted by the Construction Industry Institute in the 1980s identified the single most effective tool contractors have to prevent accidents on their work sites as pre-project/pre-task planning. A follow-up study in the 1990s confirmed this same conclusion. See the CII website for further information.

Construction jobs are dynamic and ever-changing. Planning is a necessary management tool with which to marshal, manage, and control the resources—workers, material, and equipment.

Safety is a managed process, just like any other in the construction business. One would not dream of running the job without a plan. And safety management should be treated in the same manner.

Preplanning is proactive. You manage people, resources, events, and accident-causing situations based on a plan. By being proactive, you try to anticipate problems (loss sources) and plan to minimize their impact or all together eliminate them.

Pre-Operational Safety Planning Process

The goal of preplanning is to reduce risks, which will minimize disruption, increase efficiency, and lower costs. Pre-operational safety planning is the integration of safety into the construction operational plans and procedures. It looks at potential risk in the operational plan, construction procedures, or work processes and either eliminates them or provides for controls that will minimize their adverse effect. Exposures resulting from procedures and work methods are anticipated, and reviews of applicable safety program elements are made to make sure that the operations are in compliance with the intent of the program, as well as see if they are addressed by the program. In a nutshell, preplanning looks at the when, how, who, where, and what of the construction process.

When To Preplan?

The pre-operational safety planning process can be performed at four distinct times in the life of a project. These are before the bid or the pre-construction effort, before any work is started in the field, at the beginning of each major phase of construction, and before each individual task. The greatest value of this effort comes about if it is conducted at the earliest possible time in the life of a project.

At Bid Stage

This is the most effective time to address safety issues, because they can be identified, eliminated, and/or budgeted for. One may even decide not to bid a project, thereby avoiding taking on unacceptable risks.

At Job Mobilization

This is where risks can be addressed as they may apply to the whole project. This is the time to address the interfaces of the operations of various subcontractors. This is also the time and place to get the most "bang for your safety buck."

At Pre-Operations Stage/by Job Phase

This phase allows you to fine-tune your previous plan. By this time, you may have more detail available to you, so you can address more issues in greater detail.

Special Operations/Tasks You may have unique situations that require special attention, such as helicopter lifts, etc. These need to be addressed in great detail and contingency plans drawn up to address the potential exposures.

Figure 2 provides a graphical illustration of "The Value of Early Pre-Operational Planning."

Figure 2

The Value of Early Pre-Operational Planning

The pre-operational safety planning process is accomplished at three levels: Globally for the complete project, for specific operations with high risk and exposure potential, as well as for each individual task. Obviously, it is most beneficial to look at the whole project as that is the time for arriving at the most effective and all encompassing solutions.

Who Should Be Involved in Preplanning?

All the folks involved in the different disciplines in constructions—estimating, planning, purchasing, cost control, and field operations—need to be involved in this process at certain given times.

The Estimator

This is the person in your company, who first sees the job. He/she has to evaluate the job risks and budget for them.

The Safety Director/Safety Coordinator

This person should be consulted at the bid stage to help evaluate risks that the estimator has not identified or appreciated the seriousness of. Safety also provides input as to how to most effectively and cost efficiently provide the necessary controls. The safety director brings to the table familiarity with the safety standards, and other local regulations.

Project Manager/Job Superintendent

This person provides scheduling, site layout input, and may select equipment. They may also help select subcontractors. These inputs are under the purview of the contractor and should be evaluated for any unique risks that they may bring to operations in the field.

Other Management

There may be special requirements imposed on the project by the owner. Your company may have rules that are not common to the industry, and your organizational structure may have special requirements that should be reviewed and addressed at this time.

Insurer/Broker Loss Prevention Representative

This is a resource available to contractors, in the preplan of their operations. The broker/insurer may have a great deal of in-house information and expertise that the contractor can draw on. The contractor should assess the capabilities of its broker or insurer in providing assistance in this area.

How To Preplan

There are four phases of the preplanning process: fact finding, analysis and evaluation, the preplan meeting, and follow through.

Fact Finding

The sources to get information are from the project plans and specifications, the contract, and the owner's requirements. Another source is the "means and methods" the company or the subcontractors are planning to use as well as the operational, logistic, and tactical plans. Other areas to consider are the site and its adjacencies, including local ordinances, traffic patterns, public usage, and other neighborhood realities.

Analysis and Evaluation

The things that need to be evaluated and analyzed are the potential for worker injuries, both the contractor's and the subcontractor's workers. Other things that need to be addressed are the potential harm to the public, as well as damage to property both in and around the job site.

The Preplan Meeting

The key to an effective and efficient meeting is preparation. Everyone must do their "homework" before attending the meeting. At the meeting's conclusion, there must be agreement as to what the risks are and what controls are going to be implemented. The result of this meeting will be an action plan for the control of risks, hazards, and exposures.

Follow Through

Of course, for any plan to work, there must be following through. Inspections must be conducted to ensure that controls are put in place and that they are sufficient to address to existing conditions. If there are changes, then modifications are made to meet the changing conditions. Figure 3 provides a graphical illustration of the preplanning process.

Figure 3

The Preplanning Process

What Do You Preplan for?

You "plan" for everything that has risks that are not acceptable to the organization. Through the planning process, you identify these risks, then eliminate them or try to reduce their adverse effect to the lowest possible level. To best address what to preplan, a general checklist should be created to assist the participants in addressing all possible areas involving risk.

The preplanning process, if properly done, is a "continuous improvement process." It starts with the identification of areas of risk, through the collection of data. The risks are then analyzed. Solutions are found that will address the risks. The solutions are then evaluated for effectiveness and if they meet project needs. The "best" solution is selected and then implemented. Audits are conducted to ensure that the implemented solution is effective and "working." If it is, then the process is taken to the next risk element and If not then it is reevaluated and the process starts all over again.

Summary

Preplanning is the review of planned operations before and during construction in order to identify and eliminate potential loss sources. The goal of preplanning is to reduce hazards, which will minimize disruption, increase efficiency, and lower costs.


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.

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