Investing in performance management

October 2, 2007
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As safety managers develop their organization’s safety initiatives, their aim is to identify methods for eliminating hazards by involving employees in reporting safety incidents and creating training programs that reduce injuries and lost days at work. Safety professionals are specifically looking for opportunities to capture and organize data from across the enterprise and leverage it to lower injury costs, and streamline periodic OSHA reporting.

Fortunately, advances in performance management analytics make it possible for health and safety management professionals to maximize information resources found within their organizations and place it at the fingertips of key decision-makers.

Data located within many organizations can be leveraged to drive significant improvements to safety management programs. These data elements — commonly known as key performance indicators (KPI) — are contained in a variety of information management systems used by organizations to support production activities. KPIs are metrics that can be used to benchmark performance against well-defined goals and targets of excellence from the smallest business unit to the entire enterprise.

New tools
A new generation of performance management software tools is now available that can collect, aggregate and organize data from production systems — even data from disparate operational platforms — into user-friendly information displayed on dashboards that provide a near real-time view of your company’s safety performance.

Performance management has played a prominent role in financial reporting for decades, and financial systems providers have well-established software programs that collect KPIs for professionals who produce information for analysts, shareholders and other company stakeholders. Now environmental, health and safety (EHS) software providers have adapted performance management data collection and aggregation concepts for application by health and safety management professionals who want to use KPIs to:

  • track safety incidents;
  • manage workers’ compensation costs;
  • report the number of lost days;
  • reduce the number of notices of violations;
  • elevate the number of completed industrial hygiene assessments;
  • increase the number of employees in safety programs;
  • identify action items closed on time;
  • document the number of completed safety audits and other safety-related information.
Supporting GRC goals
Performance management is an essential component for establishing benchmarks and tracking progress for corporate governance, risk and compliance (GRC), which encompasses workplace safety issues, among many other operational functions such as finance, accounting, human resources and supply chain management, to name a few.

Previously, many organizations regarded GRC as discrete, project-based activities that were managed solely as regulatory compliance functions. Today, GRC is now widely regarded as a strategic initiative that is vital to an organization achieving operational excellence. Think of performance management as your business unit’s compass for achieving corporate GRC goals.

Organizations are adopting coordinated GRC strategies that guide staff resources, standardize processes and integrate technology into procedures designed to mitigate risks. In fact, recent surveys by IT industry analysts clearly show that corporate managers plan to increase their investments in information systems to support GRC initiatives.

Senior corporate managers are also paying close attention to GRC issues. That’s because institutional investors now use GRC performance as a key barometer for evaluating a company’s risk management for a variety of functions, including on-the-job injuries. Financial analysts now provide indices that evaluate a company’s risk management performance — including its health and safety benchmarks — as a part of an overall rating of corporate governance initiatives. Organizations that fail to effectively manage health and safety risks, among other GRC issues, may find it more difficult to secure much-needed investment capital.

Best practices
Here are some best practices for you to consider to maximize your company’s future investments in performance management systems:

Use integrated software platforms for efficient safety management. Integrated suites offer organizations a breadth of safety applications, along with the option to tie into a full EHS and crisis management solution. These systems have emerged as the clear choice for an increasing number of organizations.

Integrated suites provide better data integrity, help to reduce error and redundancy and are scalable to meet your organization’s current and future needs. Suites also provide improved task management and accountability for compliance management.

Merging work processes across departments can simplify your safety management programs and boost productivity. In addition, establishment of common databases to collect, organize and protect all appropriate data provides better accessibility to data so that management can have up-to-the-minute access to information for decision-making and managerial control.

Safety management teams can plan and design coordinated strategies using performance metrics. Team members can logically connect these strategies to departmental or corporate goals, assets and desired outcomes. Integrated suites also enable compliance staff to easily measure and evaluate processes and outcomes.

Other benefits of an integrated approach include:

  • lowered total cost of ownership;
  • increased efficiency;
  • eliminated redundancy;
  • reduced operational risks.
When choosing a performance management system, make sure it is compatible with your company’s existing software systems. Not all performance management systems are compatible with your company’s existing operational or safety management systems. Have your company’s IT department carefully research which performance management systems get high marks for interoperability. This is especially true if an organization has developed its own system for managing safety data.

Most organizations operate a variety of information management systems to support their production activities. These systems work well as operational platforms, but they are not designed to utilize data that could generate safety management reports. As a result, data that could help prevent injuries and reduce safety-related costs remain out of reach from many safety management professionals. Time-savings achieved through automated production functions is lost when safety professionals have to perform multiple data entry tasks to generate reports for corporate governance reporting and OSHA compliance.

With the developments of advanced, commercially available compliance automation technologies built on industry best practices, the notion of developing homegrown systems is falling by the wayside. In fact, when considering the impact performance management tools can have on corporate decision-making, it behooves the EHS professional to work with a management system that integrates and centralizes data from different sources, allows them to define parameters that mirror corporate safety goals, and maximizes their departments’ operational efficiency.

Taking all of these elements into consideration in the choice of better information systems for safety performance management can only help to elevate the ultimate goal of any safety professional: putting safety first.

SIDEBAR: EHS pros can use key performance indicators (KPIs) to:

• track safety incidents;
• manage workers’ compensation costs;
• report number of lost days; reduce number of notices of violations;
• elevate the number of completed industrial hygiene assessments;
• increase the number of employees in safety programs;
• identify action items closed on time;
• document the number of completed safety audits and other safety-related information.

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