The body of research accumulated over the past decade makes a compelling case for safety, health and wellness to take the driver’s seat in any organization.
Companies that have achieved excellence in safety have simply performed better than those who haven’t.
It’s just common sense that safe and healthy people do better than injured, unhealthy people.
The good news is that we don’t even have to rely only on our common sense. The data backs us up. Here’s a sampling from the body of research gathered over the past decade:
- Companies that did not adequately manage workplace safety and health performed worse financially than those who did from November 2004 to October 2007 (Source)
- 61% of company executives say $3 or more is saved for each dollar invested in safety (Source)
- Over 60% of CFO’s in one survey reported that each dollar in injury prevention returns $2 or more (Source)
And, of course, here is our favorite one:
- National Athletic Training Association (NATA) study: 100% of companies utilizing the services of an Athletic Trainer reported a positive ROI (Source)
But so what?
These studies are good talking points. Consulting companies like us really, really seem to like them. But just using these studies as evidence isn’t going to be enough to get the rest of management to take action. To make a compelling case for a new safety initiative, you’ll need more than that.
So let’s dig in, shall we?
Keep Track of Your Numbers
The numbers that will hit far closer to home are the actual numbers at your site.
- Direct costs. What are you worker’s comp., health care, and other costs over the past five years? What does the trend line indicate the next five years will look like?
- Indirect costs. According to the ASSE, indirect costs can be up to 20 times the direct costs. To get a more accurate idea of your indirect costs, use OSHA’s free cost calculator. The calculator takes into account the type and cost of each injury and uses the appropriate multiple to arrive at the approximate indirect cost.
Next: Run A Cost Benefit Analysis
What are the goals for your initiative? What will the results be? What will this mean to the bottom line?
These are the big questions, and you’ll need to be prepared to answer them. Now that you know what your costs are, you can estimate what the return on investment (ROI) of your project will be. This will depend on your specific project and will be different for everyone.
If you’re using an outside contractor for your project, check to see if they have data on the ROI their other clients have seen. They might also have case studies and testimonials you can use to make the case to your management team members.
Apply their data to what you know about your facility and determine if you can expect to see the same results. Inevitably, the discussion will turn to money. Having a cost-benefit analysis prepared will arm you to take on the hard questions when they come your way.
Do An Annual Audit
It would greatly benefit you to conduct an annual audit of your safety and health program (an outside audit if at all possible), and report the results to the rest of the management team.
Conducting an annual audit will allow you to show the tangible results of your program year after year, building rapport and gaining the trust of your colleagues. The credibility you’ll gain by doing this will go a long way when you’re pitching new initiatives.
If the management team knows safety is already making a business impact on the company, they’ll be all ears when you make your next pitch.
Takeaways
The data from decades of research points to a positive ROI for excellence in safety, health and wellness. Presenting a cost-benefit analysis along with your other material will go a long way to get the “number-crunchers” on board with your project.
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Editor’s note: This is the second post in a series titled Making the Business Case for Safety, Health, and Wellness.
Previous post: The Business Case for Safety, Health, and Wellness.
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