So Why Benchmark?
April 1, 2008 By Pulp & Paper Canada
Last year Pulp & Paper Canada Magazine was asked by a number of mills participating in the Safest Mill in Canada Contest to provide some statistical comparisons using average statistical data for …
Last year Pulp & Paper Canada Magazine was asked by a number of mills participating in the Safest Mill in Canada Contest to provide some statistical comparisons using average statistical data for the three Safest Mill Contest categories, and also from other safety organizations and associations. This data would permit the contestants to compare themselves against their contest averages and against third-party entities as a further measure of their safety performance. Contest winners for 2007 were announced last issue -see March/08.
P&PC was happy to comply and decided to select data sources that would compare ‘apples with apples’ as much as possible and provide meaningful comparisons. The sources selected were OSHA (US Dept. of Labor) as many mills in Canada are subsidiaries or affiliates of US mills and corporations that must comply with US OSHA reporting regulations. In addition, many Canadian mills continue to report safety statistics to their various provincial government and safety organisations, so a sampling of these was included.
P&PC does its best to explain and make allowances for the differences in reporting criteria and definitions from one organization to another (for the most part, these differences are not major but can be annoying on occasion when trying to make exact comparisons).
World Class Benchmarks
In this age of intensive global competition, one major benefit to benchmarking is the ability to compare mill performance from one province or country to the next. This is evidenced by the increasing use of the term ‘World Class Safety’ by an increasing number of senior corporate executives from multinational corporations. Unfortunately, the jury is still out on the adoption of a global standard or definition for World Class Safety. However, led by the work of renowned safety management consultants Thomas Cecich in the US and J. M. Stewart in Canada, there does appear to be a consensus developing as to what characterizes World Class Safety from both a qualitatitve and quantitive point of view.
The key characteristics or benchmarks (as per Thomas Cecich) are:
1. The virtual elimination of injuries, illnesses and losses.
2. Safety is perceived by management and customers as a competitive advantage.
3. Management supports and encourages consistent global safety processes.
4. Safety processes are verified by external auditors.
5. The use of benchmarking against external organizations.
6. Other organizations seek out these organizations to mentor them in safety. 7. Safety accomplishments are acknowledged by outside non-governmental organizations.
8. Socially responsible investment companies acquire their stock.
9. Safety achievement is sustained across multiple business cycles, good and bad.
P&PC’s Safest Mill Contest, its Statistical Summary Table and various other initiatives already address seven out of nine of these World Class benchmarks as follows:
1. The virtual elimination of injuries, illnesses and losses by defining World Class performance quantitatively as a Total Recordable incident rate (TRIR) of less than 1.0 and a Lost Time incident rate (LTIR) of less than 0.15 (as per J. M Stewart). P&PC sees this as the current best and simplest quantitative definition of World Class Safety performance and has included it as another comparative benchmark in this year’s statistical comparison.
2. P&PC first introduced the concept of Total Cost of Safety Risk (TCSR) in 2002 as a tool for management to make the business case for safety by demonstrating how to achieve the best possible safety performance at the lowest possible total cost. Any overall reduction in this total cost (accidental losses plus prevention costs) go straight to the bottom line, adding to the company’s competitive advantage. P&PC has been working to collect enough survey data on the TCSR so that it can be added to the summary as another benchmark.
3. Management’s pursuit of consistent global safety processes is assisted by the international flavour (Canada and the United States) of P&PC’s Safest Mill Contest, statistical benchmarking and comparisons.
4. P&PC advocates the reporting of both internal and independent external-audit results of company safety processes as an optional feature of the Safest Mill in Canada Contest reporting requirements.
5. The use of benchmarking against external organizations such as P&PC’s Safest Mill in Canada Contest rules, OSHA and provincial associations statistics.
7. Safety accomplishments are acknowledged by P&PC’s Safest Mill competition which likely provides the only truly universal national safety performance benchmark in Canada where all participants are uniformly measured by the same comprehensive criteria across the country.
9. P&PC’s selection of a TRIR of less than 1.0 and a LTIR of less than 0.15 as a quantitive World Class Safety performance measure is also coupled with the proviso that these numbers are sustained over at least four to five years or more. This sustainability requirement helps differentiate safety performance in the event the Safest Mill Contest
faces ties for winners. Several contesting mills are already achieving zero Recordable Incident Rates (TRIR) for one or more years in a row, and, to their credit, through a very bad business cycle for the industry.
Another useful benefit to the safest mill contestants is the identification of significant large-scale trends in incident statistics. These trends within the contest can be compared with those from other organizations to see if they are limited or global in scope, permitting a sharing of resources to resolve problems that the trends have identified, or confirming that similar preventive strategies being employed are doing the job.
The Good, the Bad
Despite further reductions in the overall recordable incident rate, mills are still battling with a continuing trend of rising lost time injury rates, severity rates, compensation costs and workmens’ compensation insurance premiums.
Key Observations for 2007
Despite overall incident reduction, a continuing rise in lost-time rates:
• Item 4: Safest Mill Contest TRIR showed a 28% reduction from 2004 to 2007 and what is a continuing positive improvement.
• Item 14: On the negative side, Safest Mill Contest LTIR for severe injuries from 2002 to 2007 increased from 0.92 to 1.36 or up 47%. However, there were no fatalities posted in 2007.
• Items 23-27: Although no fatalities were recorded for the Contest in 2007, accidental fatality rates have shown a troubling upward trend and are three to four times higher for Safest Mill contestants than for all US and Canada combined workplace fatality rates (injury only, no illness fatalities).
These results tend to confirm that although the Canadian pulp and paper industry can be credited with declining overall incident rates (TRIR), severe injury rates (LTIR) and which include fatalities, are stagnant or even increasing and continue to require innovative new thinking to reverse the trend. (See Severe Injury Rates, P&PC, March 2006, pages 24-27).
Provincial organizations provide some revealing insights:
Alberta: The six Alberta mills that report provincially to the AFPA also participate in the Safest Mill in Canada Contest. They demonstrated a fairly respectable TRIR combined rate of 2.27 or 31% lower than the overall 44 contest mill average of 3.31. But their LTIR average was 0.29 or 79% lower than the overall Safest Mill Contest average of 1.36. Their LTIR is very close to World Class of 0.15. Perhaps the
AFPA and these mills are on to something.
British Columbia: The BC Forest Safety Council and Worksafe BC ( WCB) reported an average LTIR of 1.2 for 2006, or
12% lower than the Safest Mill Contest 44-mill average of 1.36 in 2007. However, it’s about the same as the 1.10 average in 2006. The BC Forest Safety Council, a relatively new private BC safety association, is gradually assuming responsibility for the pulp and paper mill sector. A statistical reporting system for pulp and paper is under construction.
Ontario: A review of the PPHSA Ont. 2007 statistics for its mills using WSIB data (for Rate Group 039 -Pulp, Paper & Board ) from 2000 to 2006 indicated the following:
1. The WSIB (WCB) of Ontario statistical reporting has seen some changes in the 2007 reporting for prior years but the overall corrected statistics still support the same trends P&PC reported last year.
2. The posted 25% decline in the average lost time injury rate (LTIR) from 1.13 to 0.85, as well as an 18% decline in the total recordable incident rate (TRIR) over six years, are commendable improvements.
3. Not shown in the table is the severity rate (days away from work/200000 hrs) which have continued to climb by 26 % in 2007 and by 140% since 2002.
4. In addition, total award-year benefit costs paid out by the WSIB have now climbed by 106% since 2002 for the same insured earnings.
5. The standard workmens’ compensation insurance premium rate /$100 salary climbed by 23% since 2002.
6. The PPHSA found that Musculoskeletal Disorders (MSDs) still account for approximately 47% of all LTI claims and related costs, with ‘falls’ accounting for 13% and ‘contact with machinery’ for 12%.
7. The PPHSA members’ mill performance is handicapped to some degree due to the fact Ontario mills must report all incidents to WSIB whether the incidents are medical cases or not. As a result, many non-medical cases are probably classed as medical cases for the Safest Mill in Canada Contest, inflating their TRIR rate. The exact figures are unknown
Quebec: Hours worked in Quebec mills dropped from 37.8 million in 2006 to 36.9 million in 2007 confiming the trend of machine and mill closures or downtime. The TRIR of 6.7 and the LTIR of 2.59 appear on the high side when compared with other association benchmarks such as OSHA and P&PC Safest mill contest averages.
P&PC Canada thanks Joyce Shipka and the AFPA, Suzanne Christensen and the BC Forest Safety Council, and Paul Andr and the PPHSA of Ontario for their invaluable help, statistical data and insights that benefit the contest and helped produce this article. John E. Little B. Eng/CRm, is a risk management consultant. He can be reached at email@example.com
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