25,000 insights from the EMEX CEO dashboard and why the executives need to pay attention to operational risk
Executive managers in corporate offices don't face the same daily challenges as a frontline worker on an oil rig, a petrochemical plant or in a copper mine. Therefore the priority and understanding of operational risk is somewhat diminished.
This diminishes the priority many executive managers and directors of companies give H&S and the spending on it. The challenge for frontline workers always is and will be to raise H&S and operational risk up the corporate ladder.
It is the frontline workers that see the early signs of small cracks and stress in a piece of machinery or the bottlenecks in production process which require changing. Getting changes made in company policy or production process or sending a warning to executive management only happens if that frontline worker can navigate the internal company silos to the directors box.
Not all but some directors and managers just don't see it as a priority. This is until a building burns down or fatalities occur on site. Before this point H&S is simply seen as a hassle or a boring part of the business. Which is interesting because our latest risk analytics indicate that incidents and work place fatalities are on the way up not down. The translation is that operational risk is on the way up so risk management needs to improve.
EMEX now works with over 100 global companies recording operational data. Our insights are increasing and we have developed a unique management dashboard where the CEO and directors can on a daily basis see the risk to their business on one screen. This year our software products have recorded 25,000 incidents and near work fatalities across all industry sectors including Aviation, Construction, Oil and Gas, Petrochemicals and Food production.
These figures are up from this time last year. Unfortunately we can’t put a capital figure on how much our software has saved our clients business. As these are near risk fatalities but not actual fatalities it's a grey area. There is not a number for how many lives saved or pieces of machinery still operational.
Emex has found that these operational risk events come from changes in the risk environment of a business, from unintended consequences or from intended actions that had unintended consequences. Ultimately they always go back to human factors. The underlying reason is human error of which EMEX have been working with our clients to track and understand the data and the source trends.
Someone not trained in using the equipment, a team of workers under pressure to get a job finished, a director of a company not willing to pay for the correct operational management software to protect the business and the capital invested in it. All decisions related to cutting corners or just not following best practice lead to accidents and capital loss to business.
Our analysis shows that these human factors fall into four broad reasons:
The failure and the breakdown of management control system — which creates gaps in the organisation. Most of us know this as ‘Silos’. Departments and organisations not communicating with each other — while senior management are marooned at the top of the organisation because no-one wants to tell them the bad news. Here potential risks are ignored, not addressed and there is no organisation wide response to stop accidents and fatalities.
Lack of recognition of potential threats - The uninformed workforce who are untrained to identify risks and work within an organisation which does not have the process in place to report and or take action
No risk management process — organisations and managers who take the view “it wont happen to us” and never have the risk response or action plan in place
Lack of communication around risk and response - This is simply a regular meeting or communication session where the business discusses potential risks to people, machinery and projects.
We believe that if business wants to solve the problems then operational risk requires broad-based awareness across the entire organisation. Everyone should have a broad understanding or awareness.
To discuss our insights or have a demonstration of the CEO dashboard contact us www.emex.com