Compared to 10-15 years ago, companies are safer. Whether it’s tighter regulations, more awareness, enhanced experience, technology improvements or other factors, companies are doing a better job keeping their employees safe at the workplace. However, that number has plateaued over the last couple of years—the total incident rate per 100 workers has not changed significantly since 2017.
Even with the safety improvements, 2.8 million nonfatal workplace injuries and illnesses occurred in 2019, and almost 1 million of those incidents caused a worker to miss at least one day of work.
At Avetta, we’ve known that supply chain risk management technology plays a significant role in creating safer workplaces. To see the true impact of that role, we analyzed data from 87,000 suppliers and contractors who use our supply chain risk management platform through 10 years of history to learn more about how technology is improving workplace safety measurements.
We’re glad to say this technology is playing a huge role in safety improvements—in some areas, our data shows it’s even greater than expected. Companies that implement software and systems to measure, track and monitor employees’ and contractors’ safety before they step on site yield improvements of up to 50% compared to Bureau of Labor Statistics numbers and other statistics.
The main measurements for U.S. companies consist of Total Recordable Incidents Rate (TRIR), Days Away, Restricted or Transferred (DART) and Lost Workday Case Rate (LWCR). In all three statistics, companies in the U.S. reduced TRIR, DART and LWCR by about 20% in each category by applying prequalification requirements on their contractors.
The data showed similar results for other areas of the world, with safety improvements compared to each region’s key measurements:
• APAC (Asia Pacific) companies reduced Total Recordable Injury Frequency Rate by 17% and Lost-Time Injury Frequency Rate by 19%;
• Canadian companies decreased TRIR by 22% and LWCR by 32%;
• European Union companies’ Accident Frequency Rate and Incident Rate declined by 21% and 50%, respectively;
• Latin American companies cut Lost Time Frequency Rate by 25% to 55%, depending on the country;
• Mexican companies reduced TRIR by 24% and LWCR to 38%.
The first key to improving safety is applying a rigorous prequalification system that matches not only industry and federal regulations but also specific standards to your particular workplace. Those requirements consist of tracking all, or many, of the following: safety records, training and certification, compliance, capacity to complete work, financial health and even location of goods and services procured.
Managing this documentation can be a nightmare without the aid of supply chain risk management technology. With paper or spreadsheets, you would need to pull the contractor’s folder each time they worked on a job to verify compliance for that project. With a SaaS-based tracking system, once a contractor’s information is recorded, safety documents can be verified and tracked.
For example, if a certain safety certification expires in March 2021, the system can flag that contactor as out of compliance when the certification expires. Technology can also let management know a contractor is good-to-go for a particular on-site job, signified by something like a green flag.
As companies implement prequalification and tracking technology and use it, they get better and better over time. Most companies worldwide see a 7% to 8% year-over-year improvement in workplace safety for up to 10 years (the duration of the study). Some even see greater gains.
In addition to prequalification, supplier audits can double the improvement. For example, in the U.S., companies reduced TRIR by 26% with prequalification only. By adding supplier audits to their processes, TRIR decreased by 46%. DART and LWCR measurements decreased from 20% to 46% and 19% to 52%, respectively.
Supplier quality audits verify suppliers are adhering to both industry standards as set by the law and independent organizations, as well as your own company and brand standards. Auditing processes actively foster an aligned culture of health and safety. The process is more time-intensive, but it can reap huge rewards for your business as measured in the survey results. The typical auditing process consists of the following:
• Determining goals
• Reviewing supplier policy, procedures and training documents
• Observing performance in the field
• Reporting findings and issue recommendations
• Coaching suppliers on how to close gaps
When this process is ingrained in your businesses, you can see how it can significantly improve your safety statistics—each contractor better understands your specific levels of safety, expertise and compliance requirements. Contractors who want to work for your business know your standards. They work to achieve them. Once they’ve attained that level of expertise, then they bring additional levels of efficiency and safety to your projects.
With the vast dataset available, we have more analysis to complete on how supply chain risk management implemented correctly can improve workplace safety. For example, we are interested in the safety gains made in different industries—which ones are significantly safer because of implementing supply chain risk management and which ones are only marginally safer. Look for more analysis in the future. In the meantime, embrace technology improvements in your prequalification and auditing processes. Your employees and contractors will be much, much safer on your worksites.