she strategic planning is good risk management

8/8/2019 SHE Strategic Planning is Good Risk Management

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Its thattime of

year

again!!!

Where

do Ibegin?

So manyissues to

dealwith!!


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SH&E Strategic Planning: Maturity-Criticality Approach to Continuous

Improvement

David Steinbacher, MPH,

CSP


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Goals & benefits of systematic risk-basedplanning

Elements of SH&E strategic planning

Evaluating program maturity & criticality toprioritize initiatives Maturity-Criticality Rating Scheme design,

evaluation and risk ranking

Planning for continuous improvement


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Building a Rationale forSelecting Your Initiatives


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Use a shotgun approach spray & pray Focus on injury & illness rates Rely on intuition to determine areas of

improvement Work on things you like to work onJump on the hot fad Firefight current areas of weakness or concern

Just implement goals provided by a higherorganizational level

Systematic Risk-Based

PrioritizationSystematic Risk-BasedPrioritization


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Builds a logical rationale for initiatives in a waythat makes sense to management!

Aligns initiatives to the needs of the business Provides basis for setting priorities with limited

resources Makes functional & individual goal-setting much

easier!


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Can be as simple or complex as you want it to be


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A High Level View


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How do we reach our idealized design (Vision) now?

Example: Interactive Planning (Russell Ackoff) A novel planning approach that can be applied to

any type of planning Design a desired present and implement the

means to approximate it as closely as possible Formulate the Mess (Situation Now)

System analysis Ends Planning - Idealized design (Your Vision)

Means Planning - Identify gaps & ways to bridge them

Resource Planning

Implementation & Control

Applied to SH&E management at DuPont by JamesLeemann

Risk-BasedAnalysis& Prioritization


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What are your SH&E aspirations foryour organization? Is it aligned with your overall business

direction and goals? Is it realistic or pie in the sky? Is it unique to your organization? Does it address all stakeholders? Does it inspire people?

Is it vague (world class) or is it welldefined with specific attributes thatpaint a picture of where you want tobe?

Verbalized in a Mission Statement


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;


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Existing EHS

Management SystemElements

(what maturity

improvement is

needed?)

What new EHSprogram elements orconcepts are

necessary to achieve

visualized EHS

design?

EHS initiatives

needed to address

specific business

needs / response to

environmental

drivers

Integrate EHS Strategic Planning EHSVision


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Effective EHSplanning cannotoccur in a vacuum

Understanding thekey drivers thatimpact yourbusiness, thecompany culture

& the EHS systemare essential!


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Gather all the data you can to understand the state ofyour EHS systems Perception surveys (employee attitudes & safety culture) Hazard & vulnerability assessments Needs surveys and analyses Key performance indicators Audits and reviews Behavioral observations Incident exposure ($$$) Feedback from the community Interaction with regulatory agencies Benchmarking

How effective are your systems? What are the weaknesses and opportunities? Is your system aligned with stakeholder expectations?


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Identify

ProcessElements

Create

MaturityRating

Scheme

Create

CriticalityRating

Scheme

ConductReview

Identify

ImprovementOpportunities

Prioritize EHSElements

PROCESSFLOW

OUTPUTS List of keyEHS

elements

Maturity

definitions

& scoring

system

Criticality

definitions

& scoring

system

CalcuatedMC Scores

List of

ideas for

each

element

Elements

ranked by

MC score

& maturity

Integrate with Strategic Direction & Goal-Setting


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Break down to level of detail andspecialization appropriate for your situation: Less mature systems more general

Greater maturity more detailed to fine tune

Consider management systems (e.g. OHSAS18001, OSHA VPP) that use prescribedelements or categories

Breakdown by specific programs or sub-elements Consider company culture aspects


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Assessing maturity helps to clarify the currentstate of your programs and processes Useful to use a quantifiable measuring stick:

Design a rating system that makes sense for yourorganization

Use definitions that are unique/useful for your industry Be honest in your assessment Program maturity can improve or deteriorate Look for gaps between the current state of your

programs and your vision Gaps can also be obstructions to achieving your

vision (organizational, cultural, process) that must betaken into account


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Maturity

Score

Maturity

Level

Definition

1 Introduction System element does not exist or is in earlystage of development. Major gaps existbetween vision/idealized design and currentstate.

2 Informal Early stages of a formal system. Moderategaps still exist between vision/ idealizeddesign and present state.

3 Functional Formal system established. Functions in well-managed and controlled fashion. Minor or nogaps exist between vision/idealized designand present state

4 Model Model process that is a benchmark for others.


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Rating a programs maturityreveals areas that need to befurther developed andimproved; however: What do we do if we have manyprograms at a low maturity level?

What do we work on first?

Which ones pose the most risk tothe organization if notadequately developed andcontrolled?

Which ones will give us the mostimpact for our efforts?


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Aids in prioritization by introducing risk into theplanning process What is the impact to the organization if this

program/process is not effectively implemented?

What are the unintended consequences?

Helps us focus on those program elements thatshould be addressed first to bridge the mostcritical gaps

Design a criticality rating system appropriate foryour organization

All organizations have limited resources!


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CriticalityScore

CriticalityLevel

Definition

1 BusinessCritical

Required for sustained business operation. Iflacking, potential for significant regulatorynon-compliance, fatality or serious injury,penalties and fines, major adverse event,

adverse public relations.

5 Core Key element or required process essential forproper management of EHS functional aspects

7 Improvement

Oriented

Element part of ongoing process improvement

to enhance the EHS management system.

Greater weight given to criticality moredifferentiation


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Prioritization can be aided by consideringboth maturity and criticality.

MC Score Maturity X Criticality = MC

The lower the number, the higher the priority

Similar concepts used in hazard analysis(e.g. FMECA)


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Element M C MC Improvement Opportunities

Fleet Safety 1 1 1 Vehicle selection & safe drivingprogram for sales

Blood Program 3 1 3 LEAN initiative eliminate waste

& reduce costCAPA System forEHS

1 5 5 Create cost effective system

LeadingIndicators

2 7 14 KPI tracking system

Ergonomics 3 5 15 Discomfort survey to identify at-risk employees

Economic driver: need lower program cost


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Highly criticalprogramsmust alwaysbe closelyassessedregardless ofmaturity

Programs candeteriorate!

Figure 4 MC Decision Matrix

Model (4) 4 20 28

Functional (3) 3 15 21

Informal (2) 2 10 14

Introduction

(1)1 5 7

Business Critical

(1)

Core

(5)

Improvement-

Oriented

(7)

High Priority Medium Priority Low Priority

IncreasingMaturity

Increasing Criticality


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Training Aspect Maturity Rating

Training Needs Analysis M2 (Informal)

Quality of training content M3 (Functional)

Training participation/attendance M3 (Functional)

Use of computer-based modules M1 (Introduction)

Training documentation system M4 (Model)

Evaluation of training effectiveness M2 (Informal)

Have you considered all program/processaspects?

Drill down to assess at more detailed level Example: SH&E Training Program (M3/C5)


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Depends on the companys goal-setting andbudget process

Give yourself enough lead time to gatherinformation and evaluate Prior to budget cycle is preferred

Aligned with performance process


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Use Visual Indicators toMonitor Improvement


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0

10

20

30

EHSElements

Maturity Baseline

M1

M2

M3

M4

0

10

20

30

EHSElements

Year 1 Maturity Distribution Goal

M1

M2

M3

M40

10

20

30

EHSElements

Year-2 Projected MaturityDistribution

M1

M2

M3

M4

0

10

20

30

EHSElements

Year-3 Projected MaturityDistribution

M1

M2

M3

M4

Focus onmovingprocessesout of M1and M2categories

Driven bypriority


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0.00

1.00

2.00

3.00

4.00

Baseline Year-1

Goal

Year-2

Goal

Year-3

Goal

AverageMaturityScore

Projected Maturity Transition

Projected and actual improvement in scores: Average cumulative maturity score (all programs or

categories)

Also used for average MC score


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Consider risk aspects in your planning process Be objective and critical when evaluating your

programs and processes Obtain perspectives from other people in the

organizationTake time to identify the needs of the business and

stakeholders Adjustments may be needed based on business

needs and environmental factors

Mature processes can deteriorate and all processescan be improved


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Anthony Smith (Co-Author) Shinko Campos (ZymoGenetics Retired) Russell Ackoff & James Leemann (Interactive

Planning)

Suggested Reading: Re-Creating the Corporation: Design of Organizations

for the 21st Century by Russell Ackoff

Contact Info: Dave [email protected]|206-442-6791

she strategic planning is good risk management

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