OHS Performance Measurement of an Offshore Drilling Company - Research Paper Example

OHS PERFORMANCE MEASUREMENT OF AN OFFSHORE DRILLING COMPANY Background: Offshore Drilling Operations Offshore drilling is a mechanical process in which a well bore is drilled through the seabed. The task is mainly carried out to explore and extract petroleum lying in the rock formations underneath the seabed. The process involves environmental challenges from the produced hydrocarbons and the materials utilized during the drilling process. Employees involved in offshore drilling are exposed to various occupational hazards, the biggest of which is fire, which they face at the drilling locations. The underground formations also contain hydrogen sulfide which exposes them to chemical hazards and also over-pressurization hazards (NIOSH,2013). The drilling site has open pits which contain water and drilling fluid and often an emergency responder may fall and will be unable to move out from that situation because of the slick linings and the weight of the Personal Protective Equipment which becomes soaked with the drilling fluid or the oily water. Often the rig itself cause hazards from its moving parts, there may be trip hazards, also fall from height hazards and others (Concha et al, 2004). Most drilling rigs are modified in the form of removing the handrails and chains that protects the drilling rig workers from fall hazards. Thus it becomes that safety issues through Occupational Health and Safety performance initiatives are incorporated to optimize the health issues and the productivity parameters of those workers (OSHA). Company Profile: Shell Oil Company, USA. The OHS performance system to be planned and implemented will be for the company named Shell Oil Company. Shell Oil Company and its consolidated companies (including Saudi Arabian partners) is one of the Largest Oil and Natural Gas Producer, natural gas marketers, gasoline marketers and petrochemical manufacturers in America. The company is a market leader with 25,000 Shell branded gas stations in the United States ( Holusha, 1990). Shell is engaged in extraction and refinement of oil products across 90 countries in the world. From a safety perspective there has been no lost time injury that has happened for last 5 years (Tyler,2007). Occupational Hazard and Safety Initiative Safety interventions are initiatives are an attempt to change the operations performed in an industry to ensure the health and safety of the workers. Within the workplace it can be implementation of any new program, practice or procedure (like engineering controls, ergonomic interventions, training or administrative policies) which aims to improve the safety of the workers(Abrams,2001). The safety interventions are performed at different levels of a workplace safety system involving the level of safety management and include many human and technical subsystem levels in the organization which the management may influence. The analysis of injury statistics or employee surveys including interviews with key workplace personnel (the safety manager), may help to identify the safety issues (Ladou,2006) .This will determine the type of intervention that will be required or chosen to address the safety need of the issue. Once the intervention strategy is in place there should be a process evaluation which will audit that the safety initiative being implemented as per planned. This evaluation will assess the impact of the new intervention on the reactions of the people impacted by the implementation. Thus OHS Performance systems are in line with the key goal of optimizing Occupational Health. Occupational health should aim to promote and maintain the highest degree of physical, mental and social well being of workers in all occupations, the prevention and protection of the workers exposed to the risk environment of industrial processes, thus placing and maintaining the worker in an occupational environment adapted to his physiological and psychological capabilities. The International Labor Organization published the ILO-OSH 2001to assist the organizations for the introduction of OHS management systems. These guidelines encouraged continuous improvement in employee health and safety achieved through policies, organization, planning, implementation, evaluation, and successive auditing to ensure the success of the OHS actions. OHS Performance Measurement Procedures Presently there are various types of OHS performance measurement procedures having its’ own advantage and disadvantages. They are assessed, implemented and evaluated as subjective and objective measures. Some of the methods are stated as below: Reactive Measures Loss time Injuries which are based on loss of time from work. Class 1, II & III analysis evaluates the temporary or permanent life alterations or inconvenience that impacts performance Behavior Based Proactive Measurements based from predictive analysis of the Heinrich triangle representations. Qualitative Research based on subjective feedback from the employees. Evaluation of Lagging and Leading OHS indicators. Balanced Score Card Methodologies. Critical Appraisal of the OHS Performance Measures. a. Lost Time Injury(LTI) and Lost Time Injury frequency rate (LTIFR) Lost time injury is the sum total of fatal, lost day and restricted work day injuries. A lost day injury is an injury or an occupational illness which results in absence from work for one or more days or shifts due to a disease or injury excluding the day of the injury. Restricted work day injury is an Occupational injury or illness where a employee was assigned another job or job rotation on a temporary basis due to the injury sustained or the employee worked in the same job function but for a lesser time due to injury or it can be such that the employee worked on the same job but could not perform the duties associated with the job, prior to the sustainment of injury (Textoris, 2010). Lost Time Injury frequency rate (LTIFR) is an objective measurement and is calculated as: LTIFR = Sum of all LTI * Standardized Multiplier / actually total worked hours where the “standardized multiplier” is the magnitude of the estimated number of hours that a workforce of 10 workers works in a typical year. Though LTI is a very popular OHS Performance Measurement system it has the inherent potential for manipulation through under-reporting like under-recording by manipulation of the time of recording or measurement of the LTI’s. For example companies with a poor safety climate will be more likely to under-report their injury rate while companies with a more safety climate will tend to report accurately. Moreover the association of LTI’s with added remuneration or injury compensations also distorts the LTI measurements (Cambon, 2007). b. Leading and Lagging OHS Indicators An indicator is defined as leading or lagging with perspective to its role in the management system and the operational goals framed. The lagging indicators indicate the results while the leading indicators either acts as control (implementation) or intermediate indicators. Depending on the objective of analysis and its place in the management system, intermediate indicators may be incorporated to evaluate the results of activities that underlie the overall management system. This can be done through systematic collection, organization and interpretation of textual material derived from talks and observations. There are limitations to the construction of the indicators itself. Accident rates might not be consistently reported and there may be disparities between the scales employed. The reporting events may vary within the same industrial group. This disparity makes it difficult to find common measures of measurement and comparison. Then there is a low cognitive capacity of these indicators. Normally these indicators are expressed as index or ratios provide little information about the real situation and impacts the real decision making process in relation to a specific employee. Sudden rise in the index of severity or frequency of adverse events risks the mobilization of extraordinary sources in order to prevent the recurrence of the problem. Thus a lack of vision in the evolution of OHS strategy may result in poor resource management. The ad-hoc management method risks having a detrimental effect on the new methods adopted may have a dramatic impact on overall system performance. Moreover the OHS actors are guided by the traditional paradigm based on the measurement of performance by results. The rewards for achieving the goals may bias the situation and will encourage under-reporting. Hence it is necessary to place the result indicators in the context of the overall management system and just not use them solely for performance measurement. Thus advanced indicators should be designed for the OHS sub-processes in order to improve the overall system performance level (Cambon, 2007). c. Balanced Score Card Methodology The scorecard tool is mainly designed to facilitate decision support. The tool provides an overview of the processes implemented for the achievement of the strategic objectives based on the risk factors. The quality of the scorecard is determined by its ability to inform the various concerned in the management system of the presence of deviant situations and facilitate decision making to in order to implement the necessary corrective actions (Greenstreet,2006). The representation of the scorecards should be such that it meets the needs of the end users and reflects the nature and evolution of the information. The information that is being captured should be periodically upgraded at intervals appropriate to the particular management system in context. The measurements should be interpreted provided that these indicators should be able to possibly address the dysfunctions noted. Depending on the type of information needs to be captured; the indicators should be represented digitally or graphically with or without comment and with or without time limited historical data. The quality of the scorecard rests upon its potential to alert the managers to the occurrence of deviant or unwanted event or even to anticipate pro-actively in a prospective fashion to anticipate the consequences of the adverse situations. Thus the balanced scorecard tool attempts to define various strategic areas and dimensions where the initiatives and the actions may contribute to the achievement of the goals planned. These measures are the effect of an overall strategy deployed across the whole organization (Kaplan, 1996). The regulations can be used as a knowledge base, enabling the companies to implement various types of protection and prevention measures. After the applicable regulatory limits are determined, the compliance assessments help to identify the legal obligations. Risk Analysis may be used to round out the list of measures to be implemented. Hence it provides a more exact and responsive analysis of the actual work situations. This analysis becomes very important because most regulations are not exhaustive in terms of protection and prevention measures(Health and Safety executive, 2009). Risk analysis results in the identification and implementation of the preventive measures and safeguards the reduction of risk arising from the particular activity or work. The risk management model is reflected in Fig A. Thus the construction of advanced indicators in the balanced score card method contributes to the improved measurement of performance in the safety management system and will provide a robust OHS performance management system in place (Roughton, 2002). Role of Compliance Whatever might be the OHS planned for a company there should be compliance of the application of the regulations which can be decomposed into various subset functions and described as regulatory requirements. Each of these requirements may be associated with one or more departments or job functions. The OHS specialist should evaluate the level of compliance at each step and must ensure that the regulatory requirements are met at the individual level. The compliance activities may be facilitated through an action plan. In the subsystem and so it is useful to construct and use leading indicators (Patton, 2008). External Environment Variability Control Risks Acceptable /Unacceptable risks Fig A: Represents the risk management model. Proposed OHS Performance Measurement Model for Shell Oil Company Based on the above discussion the model would be selected based on the balanced score card method including the leading indicators in the form of risks/hazards. The model would be based on the following steps: 1. Identifying and acceptance of regulatory guidelines already formulated by OSHA for the offshore drilling categories. (Appendix-1) 2. Interviewing and asking the employees to rate the safety practices formulated in the OSHA guidelines for the steps of the drilling process on a scale of 1-5. 3. The subjective feeling of overall safety based on the above safety measures will be noted on a scale of 1-5 and the performance of the employees to be collected from the management system and will be rated as 1- low performer, 2- medium performer and 3- high performer. This step will be done to find out whether the feeling of subjective safety improves performance. 4. Next the feeling of subjective safety will be correlated through the various subsets of safety feelings on the various steps of the drilling process through multiple regression analysis and it will be used to find out which steps the employees feel are very important from the point of subjective overall safety feeling. 5. The ratings of subjective feeling of safety should incorporate questions to find out whether the employee suffered any injury or have seen somebody getting injured in last one year and hence the ratings will vary accordingly. 6. The data generated should be preserved as documentation to review the action steps for future. These will include the graphs for the means of subjective safety feelings and others from where extrapolation of safety is evident. 7. After the statistical interpretations are available, a decision making process has to be incorporated to address the safety aspects met/ unmet and the risks accepted/ unaccepted as per the OSHA regulatory document. A working model of the above protocol is attached as Appendix 1-5.Data were collected from 20 employees (Appendix-2). The analysis reflected that performance was positively related and that too significantly to the subjective feeling of safety this means that more the subjective feeling of safety is ensured the performance increases (p Read More