A recent Wall Street Journal article highlighted the differences in safety records between small and large drilling companies. Essentially, the large drilling companies (i.e. market cap in excess of $50 billion) realized a 183% reduction in safety violations per rig drilled compared to small companies (i.e. those with a market cap of less than $2 billion). While it is tempting to take the viewpoint that “bigger is always better”, in this case that is not necessarily true. There are some small drilling companies with outstanding safety records (some actually performing better than the “big boys”). The question is, “What did their management team do to drive great results from operations?”
Just saying that you are going to have a strong safety program does not make it so. First and foremost, Senior Management has to “walk the walk” and “talk the talk” when focusing on driving a culture of safety across the company. Successful companies have realized that establishing an effective OHSAS 18001 management system produces the following advantages:
- Provides a structured approach for managing OH&S;
- Establishes and maintains a commitment to occupational health and safety;
- Demonstrates strong commitment to safety excellence;
- Puts organizational structures in place with clear roles and responsibilities;
- Establishes strong levels of trust and communication;
- Affects reduction in incident levels with increased measures of performance;
- Contributes to business performance by reducing cost and liabilities.
The core of an effective safety management system is based on a management approach called the PDCA cycle. PDCA is an ongoing process that enables an organization to establish, implement and maintain its health and safety policy based on top management leadership and commitment to the safety management system. It consists of the following:
Why do companies want to pursue an OHSAS management system?
Many companies decide to implement the system because it assures employees, customers, shareholders, suppliers, regulators and the community at large that the company has an internationally recognized standard in place. A company with an effective health and safety system will, typically, have safer and healthier workplaces, comply with regulations and meet customer expectations better than a company that does not have an effective OH&S system.
Companies that operate without an effective OHSAS management system often do not have the ability to avoid or mitigate fines and penalties for non-compliance, pay higher insurance costs for increased workers compensation injuries and, lastly, they expose the organization and all its stakeholders to significant reputational damage arising from an event. The benefits of the system far outweigh the cost.
At the end of the day, safety is not an accident
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If you would like to discuss how you can improve your firm’s safety and environmental compliance programs or implement an effective new OHSAS management system, please feel free to contact me at 732.395.4251 or asica@thealsgroup.com.
