Using Risk Cost to Convince Management to Invest in Safety

Dr. Amy Harper of NSC says that highlighting the costs associated with injuries and illnesses will help persuade management to invest in safety.

ATLANTA -- For some organizations, one of the biggest challenges in creating a safe work environment is convincing management to invest in safety. During Dr. Amy Harper's (director of workplace safety for NSC) presentation, many in the audience gave common answers for why this was the case: hard to show a return on investment, and it's hard to quantify something if it doesn't happen.

To combat these concerns, Dr. Harper suggested that instead of trying to estimate the cost of safe work practices, use the cost of injuries to demonstrate how bad it could be. The financial costs of injuries and illnesses in the workplace in the United States in on par with the costs associated with cancer: $198.2 billion.

95 percent of executives believe safety has a positive impact on financial performance, so it is possible to get them interested in new safety measures.

The best way to do this, according to Dr. Harper, is to develop a business case. A business case provides a formal method for evaluating safety investments.

In trying to prepare a business case, it's important to engage the workforce. Employees who are engaged show improved morality and production while simultaneously lowering costs. By addressing morality before approaching management, you will be able to show that it is possible to go forward with safety goals.

Some of the tips Dr. Harper gave for developing a business case are: define the problem and the desired outcome, calculate the cost of risk related to direct costs, use sickness and absence data as well as company financials, and express costs in a way that is relevant to management.

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  • OHS Magazine Digital Edition - May 2021

    May 2021


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