Reference no: EM133436597
Case Study: On April 20, 2010 the Deepwater Horizon offshore platform located in the Gulf of Mexico was involved in a catastrophic explosion, killing 11 workers and injuring 17. It has been cited as one of the worlds largest known marine spill disasters. In subsequent investigation(s) significant attention has been focused on the relationship between predicting, managing and measuring overall safety performance based on what are known as lagging performance indicators. How much lost time due to injury (LTI) is a very common lagging statistic. On the day prior to the April 20th event, senior executives from BP and Transocean had visited the rig to celebrate what they had determined was "7 years with out a "lost time incident" and as such a track record worth celebrating.
Lagging indicators or historical performance indicators such as LTI are still in many cases the "go to" tool used to predict future performance. It can play a key role in determining compensation and insurance risk rates, membership eligibility in various organizations, awarding of tendered contracts and is often a determining factor in how individuals personally feel about the health and safety performance in their own workplace. In more recent years it has also been used as recruiting tool for new workers. The difficulty with this approach is that unless a workplace consistently measures what actions or steps are being taken to achieve that historical performance, other factors, both internal and external, can impact future performance.
Financial markets and economics influence boardroom decisions and can have significant impact on health and safety performance. In the days following the 2008 financial market crisis, budgets were cut, jobs were lost and as a result operations and programs such as preventative maintenance were impacted at Transocean and BP. However, senior officials continued to believe that these changes were having little to no impact on overall safety performance and continued to support cost cutting. It was only after the disaster that officials discovered the impact such cuts had. It was now apparent that performance is also dependent on proactive action, and future success is not a given based on lagging or historical performance. Consider preventative equipment maintenance programs. As a result of budget cuts, inspection and maintenance programs were downsized, including reductions in labour and preventative equipment inspection and part replacement programs. The result was an eventual catastrophic equipment failure and only questions that if proactive maintenance and inspection programs had been adequate deficiencies would have been identified prior to failure.
Questions:
1) Discuss and explain the role and impact senior management have in the overall performance of a health and safety management system and promotion.
2) Often workplaces view investing in Health and Safety programs as a waste of limited financial resources. While others note that their investment has had significant returns and has made their organizations more profitable and competitive. Discuss the reasons each side may have for supporting their positions. Explain how you view those that support programs as being more ethical.
3) You have been told by staff that the purchasing of a new piece of equipment would reduce workplace injuries, lower costs and increase employee morale. There have been no real incidents with the existing piece of equipment currently being used it is just an older design. In addition, the legislation that applies to your workplace indicates that the existing piece of equipment meets requirements. You have been asked to brief senior management. Explain how you would discuss the issue with management, clearly outlining how you would address the aspects of economics, labor relations and professional ethics. Management have indicated that they will be reviewing historical indicators prior to the meeting, discuss how would introduce the use of leading indicators? Explain your decision.