Dr Brandon Carp explores how HR can lead the charge towards injury prevention, and help reduce associated costs in the process.
I often hear from safety managers that they struggle to put forward a compelling business case for their injury prevention and management programs to secure buy-in from their CFO. Financial decision makers want to understand the cost implications of human capital programs, but traditionally safety professionals have been communicating subjective gains rather than in terms that make financial sense. HR must take the lead in solving this internal communication issue
As we know, in large companies decisions are made by undertaking due diligence processes and at the end of the day, every decision taken up the chain is based on its potential ROI. Businesses want to run as profitably as possible and so HR needs to justify its investment in people
While coming up with an ROI for prevented injuries and workplace safety may seem like a quest for the Holy Grail; there is a more robust way to do this. It requires HR and OH&S professionals to embrace their capacity for commercial savvy.
The place to start is to address the often arbitrary and flawed ways of calculating ROI on injury programs that have made their way into OH&S methodology.
Often over-zealous conclusions are drawn about the ROI on workplace injury programs. These include, most notably, the unsubstantiated ‘iceberg theory’ which says that every $1 spent on an injury claim costs the organisation $7; it also takes the form of other random ratios: 1:3, 1:5 and so on. These weak and subjective calculations are not sufficiently meaningful and robust in the workplace, yet many important decisions are made based on this arbitrary rule of thumb.
Decision makers are demanding more data and greater transparency on how injury costs are calculated and it is up to the OH&S function to translate these in a more meaningful way.
Of course it is very difficult to articulate the true value of an injury prevention program because we can never know what would happen if an injury was treated differently.
Instead of searching for an unattainable measure we should be building injury intelligence tailored to our workplace, which can provide us data to guide decisions and direct budgets to injury pressure points in the workforce.
Most organisations are used to keeping an injury register and conducting basic analysis of the causes of incidents but now we can take this to the next level. We can not only learn what caused an injury but also predict where the next injury will likely take place or even who the next employee is that may be injured.
By combining workplace datasets, organisations can build more sophisticated injury intelligence. The types of data they can use include the outcomes of health and wellbeing programs, health risk assessments, general HR metrics like attendance statistics, performance review results, training compliance and longevity of employment.
The consolidation of this information with UHG’s InjuryTRACK program creates a very powerful tool for predicting and potentially intervening before the next person is injured. InjuryTRACK captures data immediately following workplace injury and tracks recovery progress as the employee returns to work. This gives the organisation insight into which factors pre-dispose an injury and what can help improve the timeliness and sustainability of employees’ recovery.
This approach provides a more meaningful and consistent way of quantifying injuries in terms of human capital. It also means employers have a pathway to improve injury rates and reduce the associated costs including financial, time and the goodwill of your staff.
About the author
Dr Brandon Carp is Managing Director of UHG, an organisation that connects business and healthcare. www.uhg.com.au.