In our last post on the changing role of the Health and Safety Manager we posited that there is an ever increasing requirement for the H&S Manager to justify their existence and that the most enduring way to provide this justification is to align health and safety performance with the growth of the business.
The alternatives to aligning with growth are broadly:
- to be seen purely as a cost centre, e.g. we have to do this to be compliant, or
- to focus on the business benefits of health and safety, e.g. reduced absenteeism, staff retention, increased productivity etc.
In some sectors, such as financial services, compliance is a major driver and has delivered solid safety performance in recent years. However, broadly speaking across most industry sectors, cost centres attract scrutiny and the most investment they can attract will be the minimum required to deliver, for example, compliance.
Justifying existence by measuring and reporting the business benefits of health and safety is generally ‘more interesting’ but still of marginal interest to the board and unlikely, alone, to compel major change in health and safety culture, for example. Yes, the benefits are all good and will, perhaps, help maintain the status quo, but beyond that?
No, to enable major change in health and safety culture and have it be at the centre of everything the business does, then health and safety performance needs to be linked to the growth of the business. This then moves the role of the H&S Manager from one of justifying existence to one of abundance.
So, health and safety has to become a keystone habit within the business – something the business can obsess over to drive overall business performance.
How do we do that? The ‘get lucky’ answer is to have a CEO whose raison d’être is health and safety. Someone like Paul O’Neill at Alcoa. But there aren’t many of Paul’s ilk around.
Which leaves us with the hard answer…
Someone, either in the industry, academia or maybe a subject matter expert author/consultant needs to develop the research base that clearly demonstrates the correlation and causality between safety performance (and/or wellness) and overall business performance. There has already been some work in this area which we’ll cover in the second part of this post, but let’s give some broader examples of what we mean first.
Net promoter score – this is a single number that measures the likelihood of customers to recommend a brand to their friends and colleagues. One number, easily understood, easily calculated, that has been shown to correlate strongly with overall business growth. Fred Reichheld developed NPS which is now used globally and has moved the ‘customer success’ function into the boardroom.
Hiring to Core Values – the book “Built to Last: Successful Habits of Visionary Companies, Collins and Porras” showed that visionary companies outperformed the general stock market by a factor of 15x. A visionary company has a core purpose (a mission beyond profit) and a set of unbreakable tenets on how they operate (their core values). Hiring to those core vaues, therefore, drives overall business growth.
Diversity – diversity is good, of course, but is there a business benefit to being diverse? Something to take to the boardroom? McKinsey showed that there is a “35% probability that companies in the top quartile for racial and ethnic diversity will have financial returns above their respective national industry medians”.
How do we replicate this for health and safety? A single number would be ideal (a la NPS) but what would that be, how would it be developed and would it be applicable across all sectors? We’ll look at historical efforts to link safety performance to overall business performance using existing safety metrics in the second part of this post.
There is a school of thought that says that making any component of business a keystone habit will have a positive impact on overall business performance, our challenge is to ensure that health and safety is that next keystone habit.If You Like This Post, Please Share It!