Dollars & Sense
We deal with a lot of questions about Health and Safety at EMEX but one that is ever present is related to cost and value. I don’t like to put a number on everything, but we have to try and put a number on this to create a sense of relative value. That’s how business works!
“What’s the cost of incidents and accidents in your business?”
Do you know the answer to this question? If you do, well done. Let’s work on reducing incidents and lowering this number. If you don’t, and that’s most of us, let’s read on.
This question is not easy to answer due, in part, to failings in the way that numbers are accounted for in most businesses. A quick glance at a set of accounts reveals very little about the cost of incidents and accidents. The common headings of payroll, insurance, depreciation etc. don’t capture the blended cost picture. The number is hidden everywhere. Days lost, direct injury costs, insurance, moral, fines, reputation, quality of life. It’s everywhere, but like smoke, hard to fully capture.
This forces us to go a little deeper, and probe for the number in new ways.
We can jump straight in here with a big number. The cost of accidents in Britain in 2011 was calculated to be £13.8b according to the HSE. I’m not sure about you, but this is a big enough number to get me focused. The number is made up of a split between workplace injuries at £5.4b and workplace illness at £8.4b. To add further uncertainty here, this workplace illness number is regarded as an underestimate. It hard to calculate the actual cause of a workplace illness in the mix of our everyday lives, and the complexity of long term illnesses caused by a mix of work and social activity. As with Health and Safety, there is rarely one direct cause for anything. It’s more complex than that!
A similar report on “preventable deaths” it the USA came up with a different set of bigger numbers. They have calculated the workplace fatality rate in the USA in 2012 at 4,383, with an additional 53,000 illness linked fatalities. The number here for these two separate but related incidents is about $250b. That’s another big number, but we also have to pause here and consider the human element and suffering. 9/11 was a massive human tragedy, as are all fatalities, but this annual toll of work place injuries and fatalities is really enormous. It’s also a call to action. Continuous improvement in this vital area can affect and improve the lives of millions of people, and this must be central to our business strategies in the future alongside the pursuit of profits.
At EMEX, we can’t argue the veracity of these empirical based numbers. They’re produced and researched by teams of highly qualified and experienced people. What we can say with certainty is that the human cost is huge, and the financial cost is also considerable and getting bigger. We can also state with confidence that the cost of incidents and accidents in your organisation will be lot more than you imagine. And changing that, is in your gift.
The common theme in all of these research documents, aside from the massive human and financial cost, is the simple tragedy of preventability. All accidents are preventable, and our work in this area has to continue by raising awareness and improving standards.
Companies often have a patchy process in dealing with safety and safety culture. Most industries are at the beginning of a long and rapid re-education in this area.
The road ahead is long and challenging but there is no alternative. Globally, there are millions of lives to be improved, and trillions of dollars to be put to better use. Investing in Health and Safety, reducing the numbers and cost of incidents and accidents, and increasing business profits to invest in new business opportunities must be better than the current status quo. Wasting money is bad business but wasting money while damaging lives is bordering on crazy. Common sense says that we stick the course. EMEX wants to be with you on this journey.