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Peter Sandman on Safety

Selling Management

Q) Let’s start by talking about one of the biggest challenges facing safety and health professionals — selling management. You’ve developed a list of 24 reasons why employers sometimes ignore safety procedures. These include management ego — “I do deals, not safety”; guilt — “Prior accidents can’t be my fault”; and hostility — “If employees paid attention they wouldn’t get hurt.”

Note: You can download a PDF file containing these 24 factors at
http//www.psandman.com/handouts/sand6.pdf.

Which one of the management attitudes you’ve identified is most common?

A) I have never done the research, and I don’t have a deep enough consulting base in safety to really say number one, seven, nine, or any other numbers, are the biggies. I have a sense but it’s a guess.

It’s almost the wrong question. If I’m talking to a safety manager whose corporate management is unresponsive I would say, take this list of 24 as a checklist, odds are good two or three of these 24 are big pieces of your problem. What you care about is which two or three are getting in your way.

A safety manager who’s sensitive to what’s going on, I think, is going to be able to look at the checklist and pick the ones causing him problems with a pretty good degree of accuracy.

Now some of these attitudes are more deniable than others. Sticking to the three that you mentioned, the ego piece is pretty much on the surface. It’s not hard to get a CEO to say, “I hire my safety department to do safety. I’m the chief executive officer, maybe that makes me the chief reputation officer, maybe since Enron that makes me the chief financial officer, but I’ll be damned if I’m going to be the chief safety officer. I hired one of those. And his job or her job is to keep safety under good enough control that I don’t have to worry about it.”

That attitude there is the sense that, “I don’t wrap duct tape around handles for a living, I make major business decisions.” And that attitude is pretty much going to be on the surface.

Convincing Managers of Their Safety Role

Q) In this case, what does the safety manager do to convince the manager that he does have a role to play in the safety effort?

A) Let me mention two possibilities. One would be to take advantage of the fairly high likelihood that the CEO is ambivalent about getting involved in safety.

That is, on the one hand, the CEO doesn’t think much of safety as an appropriate focus for a high ranking Harvard MBA. On the other hand, the CEO kind of realizes that a bad safety record can really damage the bottom line, can really damage reputation, really cost contracts, etc. So the CEO is simultaneously feeling both sides of the ambivalence. He’s on some kind of seesaw with respect to safety.

Well, whenever there is that kind of ambivalence, whichever side of that ambivalence, whichever seat on the seesaw you take, the person you’re talking to is very likely going to take the other seat.

So if you go to your CEO and you say, “Safety needs more of your attention,” the CEO is going to say, “I don’t do safety, I’m a CEO.”

So instead you go to the CEO and say, “Look, you’re much too busy for this stuff. I figure the most I can get out of you is ten minutes of your time to brief you on the very high level stuff, because you’re the CEO and safety is not your main thing.” Odds are very good the CEO is going to say, “You’ve got that wrong, I need much more information than that. I want to give much more attention to safety than that.”

This principle would be even truer for the attitude of hostility, which tends not to get acknowledged. The hostility is deep-sixed. It’s rejected. So one of the things a safety person might want to do is get on the other side of the seesaw. Now it’s not safe, no pun intended, for the safety person to go to the CEO and say, “Let’s not bother to prevent these accidents, the employees deserve them.” God forbid you’re quoted. It’s not legally safe to say. You could get yourself fired. You could get yourself sued.

But you could go to the CEO in the third person. In a conversation with the CEO about safety, where you suspect hostility to the employees underlies some of the CEO’s reluctance to take precautions seriously, you could start saying, “You know, a lot of people say this is the employees’ own damn fault.” You’re not saying it in your voice, you’re not accusing the CEO of it, but you are putting it on the table. This enables the CEO to get on the other side of his own ambivalence. He can simultaneously agree with you that a lot of people would say that, and identify himself as not that sort of person at all.

I can remember a situation where my client was arguing with a regulator. The regulator really had the whip hand and my client had to make major concessions to the regulator to get the issue settled. The CEO was really angry at the regulator, and his anger was getting in the way.

I wound up essentially expressing the CEO’s anger. I said to the CEO, “Look, this regulator is being so obnoxious and so unreasonable, I can sure understand why it might make a lot of sense to just stonewall.” And the CEO said, “Yes, but if we stonewall A, B, C and D are going happen.” And I said, “Well, it might just be worth it, just to get even with the son of a bitch.” Which is exactly how the CEO felt and how the CEO had been behaving. There was about a ten-second pause, and he said, “Well, you know, it’s easy for you to say. But they pay me to think of my shareholders, not my own emotional satisfaction. And we’re going to suck it up and make peace with this regulator, ignoring the fact of how much pleasure it would give us to stonewall him.”

This is a nice example of how a safety person can talk to a CEO and deal with an attitude that is not entirely acknowledged, with ambivalence that is not entirely acknowledgeable.

Dealing with the Guilty CEO

Q) What about the attitude of guilt? How does the safety person get around a CEO’s sense of guilt about safety, ease his sense of guilt?

A) Two things come to mind right off the bat. One would be to offer your management some kind of absolution. To say to a manager, “You know, there’s no way we could have known five years ago what we know now about how we could do A or B or C. It’s not like we’ve been systematically blind and ignoring things our peer companies were paying attention to.”

If it’s credible, you can make this case. If the company is behind, the company is behind. But if the company is not behind and the technology has just changed, or the knowledge base has changed, or industry norms have changed, then I think you can offer a kind of absolution. You can do this without accusing the manager of feeling guilty. You don’t have to say, “You feel terrible and you shouldn’t feel terrible.” You can just say, “It’s not our fault,” and make the case about why it isn’t.

Another very different strategy would be for the safety person to express the guilt, in his own persona. So the safety person says to management, “I feel awful. I have just been made aware of a process change we missed which it looks to me can save us eight, ten, twelve accidents a year. I’m aghast that I missed it. It’s my job to be constantly on the lookout for things we can do to improve our safety record, in ways that are cost-effective, and are win-wins for employee safety and the bottom line. And here’s one that is a win-win, it’s been around for years and I missed it.”

An adroit safety manager can get the CEO to give him absolution, saying, “Well, you can’t be everywhere, Jack. Don’t feel bad.” If you’ve got the CEO telling you not to feel bad, then you’ve dealt nicely with the issue.

Defining Safety’s Role

Q) You’ve said one of the enduring truths in life is that people feel small. Well, many safety departments feel “small” in terms of their place in the organization chart. You’ve used human resources as an example of a department that feels small, has a chip on its shoulder, feels it’s not respected. And you’ve gone on to say there are two things you can do when you feel small — puff yourself up, which is what most execs will do. Or you crumple. Safety crumples more than it puffs itself up in many cases.

This plays into what you’ve said, that safety and HR often are not in strong positions to go up to the CEO’s office and have high-level, persuasive conversations. So the question is: What kind of image should staff safety people have of themselves to go and have serious, high-level talks with the CEO?

A) It’s a wonderful question, I’m not sure I know the answer. Let me back off first, because another field that historically has had the same problem is public relations. I have a lot more experience with communication people than I do with safety people. With communication people, it has long been the argument of the PR profession and PR trade organizations that PR and communication need to be a line function rather than a staff function. Your communication person should be at the intersection between the company and its stakeholders; explaining the company to the stakeholders and explaining the stakeholders to the company. Advising the CEO not just on how to make what the CEO has decided to do look good, but advising him on what to decide to do so that stakeholders can find it tolerable.

Q) This applies to safety. As pros move away from being strict compliance cops, they are urged to be more of advisors.

A) This is a change that has happened in communication only in the last 10 to 20 years.

Q) How were they able to bring it about?

A) It seems to me the way they were able to bring it about is by bringing to management’s attention how costly to the company it has been to treat communication as an add-on. It became possible to say, very credibly, across a wide range of companies and industries, that people who don’t listen to their communication person until after they’re in trouble, and then expect their communication person to talk them out of trouble, are going to spend more time in trouble than they need to.

The problem is, obviously everybody would like to make that transition. And everybody can’t. And everybody shouldn’t. I’m tempted to say, although safety is not my field, I’m a risk communicator, I’m tempted to say, there are two roles for safety that make sense and you’ve got to pick one.

One is, I’m part of the senior management. I represent concerns about safety in all relevant company decisions. I need to know early on what’s happening, or what’s being thought about, so that I can input into the decision its safety implications.

The other contender is, I’m a professional. I’m off in my corner managing safety. No, I don’t need frequent access to the CEO, but what I need is very substantial autonomy. I need control over safety so that when I make the safety decision, people who don’t know anything about safety don’t get to second-guess me or overrule me.

I’m outside my field here so I don’t know how seriously you want to take this, but my sense is either of those two would work. What doesn’t work is if you’re strung out halfway between them. Policy decisions get made without you and safety decisions get overruled for policy reasons. That’s intolerable and that’s where safety becomes substandard.

You can live with a management that says, “Go manage safety and leave us alone, but we’ll leave you alone, too. We’ll understand that if you make the safety decision, it sticks.” Or management says, “Sit in on the meetings and make these key decisions with us, giving us the safety input into the decision.” Either of those I think could work.

Communication people felt it absolutely essential to be in the second role rather than the first. The line role rather than the staff role. The policy maker role rather than the technical role. I’m not convinced that safety needs to.

Weighing Values and the Bottom Line

Q) Here’s another question about selling. You’ve said, “Everyone understands to sell safety innovation you need to sell it in financial terms.” But some people argue it’s sending the wrong message to employees to say safety is about the dollars. When Paul O’Neill was the CEO at Alcoa, for instance, he said he’d fire the first accountant who came to him with a cost-benefit argument for safety. Safety was a value to O’Neill. A way of pulling everyone together to create the kind of culture that would make a business successful. Here’s the question: Are the value argument and the business case for safety mutually exclusive?

A) They can be made to be mutually exclusive by being stereotyped in ways that aren’t very useful. I have lots of reactions to what you’ve said. Let me tell you a story. When my eldest daughter had just gotten her driver’s license, and she was driving alone for the first time, I said, “Look, you’re a new driver, you’re an inexperienced driver, you’re not a very safe driver. You have to make safety your top priority. And all other considerations should give way to safety.”

She said to me, “Well, then I won’t leave the garage. If I’m optimizing only for safety then I never get out of the driveway. Because it’s safer in the driveway. And if you want me on the road at all, I can’t just optimize for safety. I have to compromise safety with getting somewhere.” She was just flat out right.

So when you say safety is a value, and we’re doing safety for reasons that are not dollars and cents, you can stereotype that to mean the cost per life saved by safety innovation should not be relevant to the decision whether or not to make that innovation. That’s an insane argument. The safest factory shuts down.

No one wants to optimize safety by shutting down. No one wants to drive two miles an hour on the highway. No one really means to say, “Do things the safest possible way regardless of what that does to productivity.” No one means that. And since productivity is measured in financial terms, you simply can’t make safety a value that is not conditioned by money. You can’t.

You can, however, say, “In assessing safety innovations, of course we have to pay attention to money, but we want to be very aware of the fact that there is an equity issue here. It’s our money and somebody else’s life.”

Let me explain. If you’re asking me how much money is it worth to save my own life, or how much money will I spend to make me safer, then it’s my safety and my money and my call. But if it’s how much money should I spend to make somebody else safer, then it’s my money and their safety. It has to be a joint call — where I care more about my money than I do about their safety, and they care more about their safety than they do about my money. We have to compromise.

A different story maybe makes some sense out of this. I worked with a mining company that brought me in because they were unsuccessful in persuading employees to work safely. The company had a pretty poor safety record, poorer than other mining companies, and it was actually losing business because regulators didn’t want to let them open up new mines because their safety record was rotten. They were losing business opportunities to competitors because of their safety record.

So they really wanted a better safety record. And they would reach out to employees and say, “Work safer,” and employees wouldn’t. So they brought me in and asked, “Why are our employees ignoring our demands, our messages that they’ve got to work safer?”

One of the things the company was aggressively saying was, “Safety is our number one priority.” I started talking to employees and asked, “Why is management’s safety campaign failing so badly?” Many employees said to me, “Well, they don’t really mean it.” I said, “What do you mean?” The employees would say, “Well, they’re claiming that safety is their top priority, they’re claiming they care more about safety than productivity, more about safety than profitability, and we know that’s crap. We know they care more about profitability and productivity than they do about safety.”

Employees were loyally ignoring the safety message. They thought they were doing management a favor by recognizing that the management safety message was a con, was for external consumption. They thought management wanted the safety message ignored, and they thought they were doing the right thing.

What I ended up recommending and what management did, and it helped, was to change their message to employees. They stopped saying “Safety is our number one priority.” What they started saying was something like this: “Look, as you all know, our number one priority is return on investment. Profitability and productivity are the things our shareholders judge us by. Those are the things we live or die by. At the moment, one of the most powerful barriers to profitability is our poor safety record, which is costing us a fortune. Now it is also costing our employees far too many accidents, so that employees’ lives are damaged and sometimes ruined. But also our bottom line is damaged and sometimes ruined.

“Now some day, if our safety record gets better, we may get to the point where the interests of safety and the interests of productivity and profitability diverge, where the safest thing is no longer the most profitable thing. Then we will have to make very difficult moral choices about how much profit we’re willing to sacrifice in order to be how much safer. But we’re not there. At the moment our safety record is a risk to profitability. If you graph profitability against our current safety record, getting safer will mean simultaneous improvements for employees in their likelihood of getting hurt, and improvements to the company bottom line.

“When they diverge, when we get to the point where our bottom line interests and your safety interests go in different directions, we’ll have to argue about it. But they don’t diverge yet. For heaven’s sake let’s get safer and at least get to the point where we have a conflict.”

That message worked. Employees said, “OK, we get it,” and they started working safer.

What every company ought to be saying is, “Some safety innovations are good from the values point of view, and also good from a dollar point of view. They are not controversial, you just do them. Others are good from the values point of view and they don’t pay for themselves in dollars and cents terms. Those you have to look hard at, and argue about and decide whether you can afford it, whether that is what you want to afford.

“If you let every value overrule money, eventually you go bankrupt. If you let money overrule every value, you lose your soul and eventually you go bankrupt anyway, because nobody wants to do business with a company that has no values, that has no morality.

“So a company that ignores money is a stupid company, and a company that ignores everything else is a stupid company. You have to balance them against each other when they conflict. And for heaven’s sake, when they don’t conflict, you have to notice it and go for the safety innovation.”

Competing for Resources

Q) I think a number of our readers are at the point where safety can be in competition with profits. Look at the national workplace injury rates, they are at all-time lows. That mirrors what is happening in a lot of readers’ plants. The safety record is quite good. Maybe better than the industry average. In this kind of facility safety is seen as being under control. On the other hand, you have all these well-known pressures on profitability in the economy today.

So the safety person is in the middle. He or she still has ideas, still wants to do things, initiatives and innovations. How does he negotiate, compete for resources with other departments in the organization? How do you see this argument being played out?

A) I would want to distinguish two different problems. One possible problem is that safety simply does not have as good a return on investment as other possible investment opportunities. If it is just flat out true, that a thousand dollars spent on safety is going to return less long-term to the company than a thousand dollars spent on marketing or a thousand dollars spent on process improvement or wherever, then that’s a real problem. Safety has reached the point where further improvements are going to be at the expense of the company, rather than to the advantage of the company. If that’s true, a safety professional, it seems to me, who’s honorable has to acknowledge that that’s true.

Then you start monitoring for things that would change the situation. If regulation gets tighter, that would change that. It’s not like regulation is somehow external to the system. What a society does, and what it’s suppose to do when it wants something to happen that the market won’t make happen because it won’t pay for itself, is to put pressure on regulators to make it happen.

If the world wants factories to be safer than it is cost-effective to be, then what we’re supposed to do is tell the Bush administration, or whatever administration is in power when we reach this decision, that we want OSHA to be much more aggressive. We want hazards A, B, C or whatever regulated. We realize that a regulated company will do it, and will pass the cost on to customers, and we want that to happen as a society.

That’s what we did with environmental regulation. We decided that we wanted to require companies to be cleaner than it was cost-effective to be, so we pushed for regulation.

So a safety professional might well take this position: “As a representative of the company, I notice that we’re doing all we have to do legally, and we’re doing all we have to do that makes sense financially. So until something changes we’re on maintenance.” And then the same safety professional might go join an activist organization and try and push for stronger safety regs.

It would be wonderful to see a company, in the form of its safety director, testifying before Congress, saying: “A and B and C and D are things that would really improve the safety of the workplace, but they don’t pay for themselves. They are a cost to society. We would have to pass that cost on to our customers, which we would very much like to do, but we can’t if our competitors don’t. What we really need is a law. {Mr. Sandman laughs at this point in the interview.} Then we’d be cool.” The company is simultaneously representing its economic self-interest and its values. It’s saying, “Give me a law so my values and my economic self-interest don’t have to fight it out.”

Now, let me go down the other path. I think many companies that think they’ve done all the safety that makes economic sense are just flat out wrong.

If the data don’t support me, then the data don’t support me. But my sense is that the safest companies in most industries are a couple of orders of magnitude safer than the average. And the safest companies tend to be the most profitable companies. There’s obviously a causal question there — are they safest because they are making so much money they can afford to be, or is safety making them money? I can’t prove the answer to that. I know DuPont, which has built its reputation around safety, argues that many of the costs of being unsafe are hidden costs. There are morale costs that don’t get attached to safety, there are retraining costs that don’t get attached to safety, there are reputation costs that don’t get attached to safety.

DuPont’s safety consultants argue, and I think they have pretty good data, that the company that is slightly above average for its industry has not picked all the low-hanging fruit. It thinks it has, because it’s above average. But the whole industry is missing low-hanging fruit because of some of the attitudes we talked about earlier. They are missing it because of guilt, they are missing it because of hostility, they are missing it for the 24 reasons that are listed in my handout.

So they are saying to themselves essentially a false syllogism: “We are above average, therefore it is not economically sound to get safer.” That’s a non-sequitur. To find out whether it’s economically sound to get safer you have to calculate the long-term costs of an accident. And the long-term costs of an accident include things that aren’t in the standard calculations of what an accident costs. People calculate the workers’ comp costs, the direct costs. They don’t look at the morale costs, they don’t look at the training costs, which tend to be very substantial, they don’t look at the recruiting costs. It’s hard to recruit to a job that’s dangerous. They don’t even look at the productivity costs. When accidents happen workers get fearful. When workers get fearful they do things that may or may not make them safer, but that certainly make them feel safer, and that could damage productivity.

Let me explain. An employee thinks X and Y are dangerous things to do, and the company is not taking this precaution or that precaution because it thinks it is not cost effective. So the employee may be taking his own precautions, which may be far less cost effective, and they are invisible to management. We just think, “Oh well, it takes three quarters of an hour to do that task,” but it could’ve taken 20 minutes. The employee is doing it in that amount of time because the employee feels it is dangerous.

Q) So it’s the safety director’s job to explain these hidden factors to the CEO?

A) I would say so. I think the safety person needs to say, “Look, direct costs are direct costs. And regulatory costs we understand and acknowledge. We know about getting fined. But reputational costs are also money costs. Morale costs are also money costs.”

The safety person needs to be good at assessing what safety precautions — including ones that are innovative, that are not the norm in the industry — will pay for themselves when the indirect costs are considered.

If it really won’t pay for itself, then you’re stuck saying some much more indirect things. Then you wind up saying, “There is a niche for companies that are safe beyond return on investment. And that niche is going to have its own reward. Getting a reputation as a company whose values are so pro-employee that it makes a priority out of safety will bring us higher than average morale, lower than average turnover and a variety of other benefits.” You end up making an even more indirect financial argument.

Bottom line, if you can’t make a case that’s it’s good business to be safe, then you’ve got to go make it good business to be safe by changing the external payoff matrix. Over the long haul, if you want a capitalist society, companies are not going to do things that don’t make economic sense. So either you persuade them that it makes economic sense, or you change the payoff matrix so it begins to make economic sense.

Dave Johnson is the ISHN E-News editor. He can be reached at djsafe@bellatlantic.net, (610) 666-0261; fax (610) 666-1906.

Copyright © 2003 by Business News Publishing Co.

Contact information page:    Peter M. Sandman