Selling Safety

You want to implement a behavior-based safety (BBS) program to help your organization reduce workplace injuries and illnesses. You’re convinced a BBS program – as the foundation of an overall strategy to foster a healthy safety culture – would be an effective tool for eliminating at-risk behavior, reducing costs related to incidents and injuries, raising overall safety awareness, monitoring workplace conditions and developing safety leadership skills. But how do you convince management?

Well, you have the statistics on your side. In 2009, the Bureau of Labor Statistics reported 4,551 on-the-job deaths – roughly 12 people killed at work every day. And more than 3 million workplace injuries and illnesses were recorded – roughly 8,980 daily – keeping workers off the job for 965,000 days while they recuperated. The most disabling of these injuries and illnesses collectively cost more than $1 billion a week in workers’ compensation, according to the 2010 Liberty Mutual Workplace Safety Index.

But rattling off stats will only take you so far in convincing upper management to green light a BBS program. You need to sell safety to top-level leaders.

The most effective way to catch and keep management’s attention is to build a business case for BBS that clearly demonstrates its financial payoff and support for existing company initiatives. This article will show you a game plan for success.

Seek Partners

Before you begin, there are two important steps you need to take. The first is to stop referring to BBS as a cost. Instead, reframe safety efforts as an investment – a commitment of resources to earn a financial return or gain future benefits or advantages. Then, when presenting your case to management, stress that resources allocated for this BBS program represent an investment, not a cost.

The second step is to seek out and engage people in your organization who can help you make your case. Find someone in accounting or finance who can help you secure and crunch the numbers. Discover if there is a higher-level leader in your organization with previous BBS experience. This person can be a great ally, and assist you in the sell.

Make the Financial Case

Now you are ready to dig in. The key to building a business case is laying a solid financial foundation that shows how BBS positively impacts the bottom line. First, calculate what workplace injuries and illnesses cost your organization. In 2010, the National Safety Council estimated that, nationwide, unintentional workplace injuries carried a price tag of $183 billion annually in direct costs alone.

Direct costs – Start by pulling your company’s current and past cost data concerning workers’ compensation costs. This includes medical costs, wage indemnity and claims administration fees. Also, pull your actual workers’ compensation premiums. Use these to determine what an injury or illness directly costs your company. Some organizations like to break this number down into how much workers’’ compensation costs the company per hour worked. It’s helpful to note that the National Safety Council estimates that a disabling injury costs $53,000, while a workplace death comes in at $1.33 million.

Indirect costs – Don’t overlook hidden costs. Some estimates put the indirect costs of injuries and illnesses at five times the direct costs. This includes expenses associated with lost production, poor quality goods, damage to customer relations or public image, labor relations, turnover and retraining, sick time and missed shipments. Factor these indirect costs into your estimate.

ROI – Once you know what injuries and illnesses are costing your company, calculate what the payback would be for investing in a BBS program. Organizations usually have guidelines pertaining to major projects that require capital investments or that are expensed. Use your contacts in finance or accounting to help you get familiar with your company’s guidelines. Follow those guidelines when making your projections.

Determine what the investment in BBS will be in terms of dollars – Next, project what your anticipated reductions in claims and workers’ compensation premiums will ultimately be, and over what time period. (A 2-year payback generally is considered good.) You can compare the costs of lost-time injuries and workers’ comp claims to project a breakeven point for your proposal.