Constructors Magazine Article – 2005

Source: Constructors Magazine Article – 2005

Features: Issues & Trends — March/April 2005

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AGC firms share their safety successes to help establish an industry-wide culture of best practices

By Mary Buckner Powers

A cultural revolution is happening within the construction industry and it’s all about making safety a value instead of a priority.

“Priorities change, values don’t,” says Al Arguedas, safety manager at Skanska USA in Beaverton, Ore.

Companies that have embraced the new way of thinking about safety have seen results that range from better communications among subcontractors to vastly improved profits. It sounds too good to be true, but firms have the evidence to back up their claims.

There is a catch, however. If corporate leaders embrace safety simply to improve their products and profits, it will fail, says Jay Greenspan, founder of JMJ Associates in Austin. His consulting firm helps companies move beyond counting incidents to a new culture where safety becomes a passion. “The bottom-line results are a gift,” he says.

The Human Side

Safety statistics tracked by the Bureau of Labor Statistics show a huge reduction in the number of construction accidents between World War II and 1990. But the incident rates have flattened in the last 15 years.

“We spend more time, energy and money today on safety than at any time in history with no improvement in the numbers,” says Greenspan.

The return on the safety investment today is zero. “Is there any part of your business where you would tolerate no return in 15 years?” he says.

When workers are equipped with the proper training, processes, procedures and the right tools, Greenspan says only one variable is left to blame for most injuries-human error. To move beyond the 15-year plateau and reduce the number of injuries and incidents, companies have to focus on the human side of safety.

“That takes a culture of support and a commitment from management,” he says.

Skanska USA’s Oregon office, formerly Baugh Construction, saw its incident rate drop from 7.0 in 1996 to .92 in 1999 after company managers changed their approach. Now the rate hovers around 1.0 every year. The firm shared its new safety philosophy with its top 40 subcontractors, whose incident rates over three years dropped from about 8.0 to 1.5.

(photo credit: Workers should wear high-visibility safety vests when working in close proximity to heavy equipment on excavation sites.)

“We couldn’t have achieved that without a total focus on safety,” says Tom Anderson, Bergelectric’s vice president. “Excelling at safety really means you are in control.”Bergelectric Corp. in Los Angeles, the grand award winner in the Associated General Contractors’ 2004 safety excellence program, saw its profit margin as a percentage of volume increase by 40% in 2004. Its business has grown since 1996 from $80 million a year in revenue to $320 million.

Bergelectric placed second in the AGC safety competition in 2003, and company officials were stunned at their competitors’ levels of safety sophistication. “We came away saying we need to kick it up a notch or two,” Anderson says.

Creating Passion

Tim Gottberg, chairman of the AGC program’s award judges and safety manager at GLY Construction, Bellevue, Wash., says what sets the winners apart is their passion. Finalists submit a written description of their safety program and deliver a five-minute presentation to the judges, who then have 10 minutes to ask questions.

“You know the passion when you hear it and when you read it. You can feel it,” Gottberg says. Judges try to look beyond the safety statistics to see the company’s commitment. “The winners are doing it because they think it’s the right thing to do.”

Charlie Bacon, president and CEO of Limbach Facility Services, Pittsburgh, is former CEO of Bovis Lend Lease. The New York City-based contractor won an AGC safety award in 2003. Bacon says he thought Bovis was doing a good job with safety, until it had a fatality.

“We realized we were doing things right procedurally, but we still were not getting into the guys’ heads,” he says.

Bacon is taking Limbach down a new path. “We want to be way beyond what OSHA [the U.S. Occupational Safety and Health Administration] requires,” he says. “We want to be incident and injury free.”

Bacon’s challenge is to make sure Limbach’s senior staff understands what he’s trying to do and share that enthusiasm with trade workers. “This is my passion. I want to change the industry,” he says.

A Moral Obligation

According to Bacon, most tradespeople today have had so much exposure to safety training that they cringe at the idea of another safety class.

“Now we need to make them aware of what will happen if they injure themselves [and] what will happen to their families,” he says.

Bacon tells the story of a manager who saw a carpenter without a harness and asked him if he had a family: “In one second, you could be off the building. What about your wife and kids?” The carpenter responded that no one had ever explained safety to him that way.

“That was a success. We changed that man’s thinking about safety,” says Bacon.

The key to Bacon’s safety success at Limbach is that he actually cares about the workers, says JMJ’s Greenspan. “He’s not pretending. It’s not fake, it’s not politically correct. The commitment to safety as a value requires honesty in order to work,” Greenspan says. Workers have to see that managers mean what they say. “It’s a dignity and respect thing.”

Washington Group International won AGC’s 2004 safety excellence award in the heavy division for more than one million work hours. The company has the attitude that construction workers are friends and family and it is imperative that a firm take care of its own, says Brad Giles, vice president of safety. “We have a moral obligation to take care of our employees,” he says.

Safety is a corporate value at WGI, but it is managed as a function, just like cost, quality or schedule. “We look at safety as a leading indicator. If we can manage it, we can manage the rest of the job. If we have a safe project, we will have a successful project,” Giles says.

At Boise-based WGI, the scope of the project is reviewed to find potential hazards, and a plan is developed to eliminate or reduce them. The company continues to improve its safety matrix, and 2003 was its safest year yet and its best year financially. “We can point solidly to a correlation,” Giles says.

Safety starts at the top at WGI and moves down through the levels of management to the workers. This also applies overseas, including its more than 25 engineers in Iraq. “We work at the same standard abroad as we do in the U.S.,” says Giles.

WGI shares its safety values and practices with all of its competitors. “We might be joint venture partners tomorrow,” says Giles.

Company officials also work with high schools and vocational schools that have building programs. “We train the instructors to teach the right way to be safe,” he says.

WGI holds workshops to train safety professionals, supervisors, clients and even regulators. “We share our best practices,” Giles says, noting that WGI spent $52 million on safety training last year. WGI’s next project is to inject safety into current and future managers’ business curricula. “Most MBA students don’t have a single class on safety issues, workers’ compensation and the hidden costs they represent,” says Giles.

Safety is one of five core values in the engineering and construction giant that has gone from measuring lost-time cases to making safety a performance objective and leading indicator.

“We must have good injury rates, but it’s the other things that set us apart,” Giles says.