Overarching Objectives (e.g. Compliance)

Overarching Objectives (e.g. Compliance)

As well as setting business goals, organisations must comply with regulations, such as health and safety, data protection, etc. Following rules and regulations might seem ‘basic’. Still, health, safety and environmental disasters and fines imposed on many organisations highlight it can be harder than many think.

You can explain this by recognising that a goal to be safe or compliant belongs in a category of what I call an ‘overarching objective’. An overarching objective can seem straightforward, for example, ‘Ensure no serious incidents or accidents’.

The argument that being safe and compliant should not be that hard tends to go as follows:

‘Surely everyone knows that they need to be careful with safety? So, if we remind staff regularly, promote good practices and ask them to call out bad practices when they see them, it surely won't be that difficult to achieve! Likewise, suppose we find people who do the wrong thing. In that case, we will discipline or even dismiss them, sending an example to everyone else to take this seriously’.

Here, the argument is: ‘What's the big deal about safety and compliance? It's mostly about staff doing what is common sense’.

However, Alan Dixon (former HR VP) highlights how such a mindset can miss the reality of what can happen in practice:

‘I've seen things that have brought home just how hard it can be to keep health, safety and environmental risks under control.

For example, at a production facility, an articulated lorry was brought to the site containing chemical in a tanker. The driver of the truck, who worked for a haulage company, deposited the tanker in an allocated bay on site, with the ability to catch a small chemical spill, and left. It was the weekend, and he parked his cab at a nearby hotel but did not leave any contact details. All of this was done in accordance with procedures.

A few hours later, security guards on the site noticed that the tanker had started to “vent” chemical, suggesting the chemical inside was unstable, most likely too hot. Unfortunately, it wasn't possible to contact the lorry driver to clarify exactly what should be done, so it was decided that the sensible course of action was to cool down the tanker with water. This was practiced in drills in the past and should have been quite effective within a relatively short time.

So, a fire tender was brought close to the tanker, and it was drenched using a hose with water under pressure. However, instead of things calming down after half an hour, it took much longer for the venting to stop. And it transpired that this was because the chemical in the tanker was in a thermal blanket, so the cooling effect from the water was marginal. From a health and safety perspective, the steps taken were a success, no one was injured and the venting was eventually stopped. But from an environmental perspective, there was a problem. Because of the time it took to cool down the tanker, some of the leaking chemicals had mixed with the water poured onto the tanker. After a while, the chemical overwhelmed the containment area and then flowed into a nearby river. It resulted in the death of fish and other creatures.

What happened was all reported, and an investigation took place. It revealed that the chemical in the tanker got hot because the refrigerator on the tanker had stopped working. It also became clear that the standard drill to “cool down the tanker” did not work as planned because of the insulation around the tanker.

We also realised that not having the phone number to speak to the driver contributed to the incident because he could have suggested a better way to handle the problem. It seemed such an unimportant detail before the leak, made more complicated by the fact that the driver worked for the haulage company, but with the benefit of hindsight, you realise that small details can really matter.

The irony here was that despite all our efforts to manage health and safety, we ended up with an environmental problem that had not been thought through sufficiently. As a result of what happened, we carried out a series of “lessons learned” updates at the plant and with our contractors. We then commenced an initiative to improve our ability to identify health safety and environmental risks at a more granular ‘on the ground’ level and, in any event, to have a more robust chain of communication in the company and with contractors.

One of the most important lessons I learned from this episode is how easy it is for small details to catch you and for you to be held accountable, even when those involved are not under your direct control. Of course, the immediate cause of all of this was the haulage firm dropping off the tanker onto the site and not realising the chemical had become too warm, but one of the root causes for what happened was not realising that something routine could turn into a big problem quickly and become so hard to get on top of.’

Alan's example shows how a threat posed by an external factor (i.e. the tanker brought in by the contractor) can be underestimated and how, if you don't see the threat, you aren't going to be especially on the lookout for problems (until they happen). And not seeing all the threats you are facing might be explained by limitations in the experience and training of those who must make those assessments.

But the incident was caused by more than that; there were several good ‘recovery’ plans in place, but they were found to be wanting because of imperfect information, requiring a better exchange of information between the contractor and the company. It should be clear – again – that one root cause just doesn't cut it.

So, when an organisation sets itself an ‘overarching objective’, it is setting a series of mini goals along the lines of: ‘No environmental or safety issues involving any of our staff, or contractors, at any time, across all of the activities we are involved in’. Such objectives have the character of saying: ‘No one must spill a single drop, anywhere, or at any time, this year, or next year, etc.’ Goals like this can be undermined by a range of things, including:

1. an erosion of standards caused by other priorities, or cost pressures, or
2. an inability to keep the risk alive in the minds of busy staff 13 and
3. insufficient ‘early warning’ mechanisms to detect if standards are starting to slip.

Andrew Wright offers an additional insight in relation to what it takes to have an authentic safety culture:

‘I was trained in BP about the importance of safety, particularly working in a high‐risk environment. When I started my career, I remember thinking that what they were talking about to keep things safe was just common sense. I also remember hearing people who were rather fatalistic about health and safety. They thought it was unrealistic to aim for no accidents. They argued it's not possible; accidents happen.

But over time, as I saw how people behaved, reporting near‐miss incidents at management meetings, doing root cause analysis, and sharing “safety moments,” it became clear to me that aspiring towards zero accidents was something you could make a serious ambition.

Every now and again, I realise how outsiders might regard the level of attention towards health and safety as something rather bizarre. It can come across as somewhat obsessive, almost like belonging to a cult. But if you are serious about health and safety, you need to get to that level of focus and attention to stand a chance of not having any problems. This is because, in a high‐risk environment, if you let down your guard for even a few seconds that can be enough to land you with big problems.

This means that the role of managers and senior executives to role model the right behaviours and to call out any problems they see is crucial. “Common sense’ just isn't good enough”.’

Many difficulties can arise in relation to goal setting, discussed in a range of helpful books, including:

• overconfidence following many past successes – see Danny Miller's book ‘The Icarus Paradox’,14
• too much subjectivity in risk assessments – see Douglas Hubbard's book ‘The Failure of Risk Management’15 and
• a failure to consider the very worst things that might happen – see Nassim Nicholas Taleb's seminal book ‘The Black Swan’.16

And the fact that one can write a book on each of these topics highlights how big a theme we are looking at. But it's important to recognise that when you find weak spots in goal setting, the people involved at the time often didn't realise that the goals were unreachable or that there were show‐stopping problems or risks, or the importance of being clear about their tolerance for failure.

And even if problems or risks are apparent to some people at the time, they would still need to voice these concerns, and managers would need to have the humility, and wisdom, etc., to take the right action as a result. This something we will return to again and again in what follows.