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When 1 + 1 = 3 ‘The integration of Occupational Health and Health & Safety’

The integration of Occupational Health and Health & Safety’…  an opportunity of incredible proportion – but when thinking this through, the words so commonly used by the stock market, namely ‘mergers and acquisitions’, wouldn’t necessarily spring to mind.

The learning however from the City is very interesting. In essence, a merger or acquisition is undertaken to, in its purest form, enhance shareholder value. Two elements come together and the output, the benefits, are enhanced for all involved. 1+1=3!

This article concerns health & safety, so I won’t bore the reader with City speak – but let me briefly say that often a city merger can have more to do with glory-seeking executives than business strategy. A booming stock market can overvalue opportunity or the merger may be a defensive tactic born from fast-changing and competitive economic landscapes. An earlier study by KPMG shows some 83% of mergers fail in one form or another. It’s complicated, but a large element of this failure rate is down to reasons for flawed intentions.

At least in the Board room of most companies, they would agree on one thing.

  • That the human asset of their overhead is probably the most expensive piece. It follows therefore that any saving and improvement in the KPI’s in this space will create a big ROI.

You don’t need a pinstripe suit to understand that. So no flawed intention here that I see.

The potential offered by the merger of ‘creating a safe physical and operational environment with a focus on the individual working within that environment’, H&S and OH, seems, well, common sense.

An article discussing H&S and OH will always stress the points regarding the cross-over between the two disciplines, especially in the area of ‘risk assessment’ for example, ensuring that processes and policies are put in place to reduce work-related ill health.

H&S practices may appear to be pro-active (preventing risk) and OH practices re-active (dealing with employee health issues once they occur). However, this should rarely be the case, and the focus of OH today should be to monitor employee health, improve health awareness and prevent illness before it occurs.

Let’s look at the output of this potential merger, the ROI.

Popping back to the ‘City’ for a moment, then:

Tangible Capital                 +              Human Capital    =              Turnover (creating the opportunity for profit)

(Equipment)                                            (Labour)                                   (OUTPUT)

You can estimate very accurately the value of healthy ‘tangible’ capital. Every good CEO will know the cost associated with the company’s equipment. The equipment’s depreciation, its maintenance and its consumables – and I can tell you she or he will know this to the penny.

Who would argue with the phrase “a company is only as good as its people” and yet companies are more likely to spend money on broken equipment than staff wellbeing.

Apple is the most successful company in the world and Steve Jobs said: “It’s not the tools you have faith in – tools are just tools, they work, or they don’t work. It’s the people you have faith in or not.”

The costs of good Human Capital Management, or rather poor Human Capital management, will, at best, only be a crude assessment. The CEO will probably have a good idea of what it cost when it last went wrong. The last tribunal, the most recent claim, or the most recent sick day spreadsheet from HR.

We have all read the latest HSE stats for the cost of absenteeism, presenteeism and leaveism (working on holiday!).

It is true to say that today, better-informed reports are tabled to the Board, assessing the cost of accidents and illness, than ever before. We are making progress. Indeed, improved attention and investment are given to H&S issues because these are better quantified now than ever before.

But dare we say that these costs are easy to collate if you have the right team and technology in place. The trick is to close this circle of opportunity on what is potentially the bigger ROI share partner in this merger – the OH challenge.

In my opinion, to quantify OH issues and consequences is still the challenge that evades us.

For example, it is often easier to work out what has caused an accident at work, its immediate cost and preventive activity, than to assess whether an employee’s on-going health problems have been caused by, or exacerbated by, the working environment. And what impact this is having to the desired city ‘output’.

What we do know, from the 2016 CIPD survey, is that around 140 million days were lost to sickness absence across the UK in 2015 and this does not include the issue of presenteeism (unfit for work but being at your desk!.)

So – the leap of faith for The Board to invest at the required level, across both disciplines, to make a sustained and meaningful impact on our human capital, therefore, continues to be insufficient. AND WILL CONTINUE TO BE SO.

Let’s stop moaning and let’s help them. You must agree with these statements!

You can’t manage what you don’t measure

You can’t measure what you don’t record

What you don’t record you can’t report

What you don’t report you can’t assess

What you don’t assess you can’t adjust

And what you can’t adjust stays the same.

For the Board to make informed and better decisions they need knowledge. Knowledge can only come from better information and better information can only come from good data.

It’s not surprising that justifying OH investment and full integration of the opportunity to bring together H&S and OH has not been forthcoming because we have not before been in a position to justify clearly, with evidence, a Board investment and its real ROI potential in this space.

Companies still take surprisingly few steps to analyse patterns of staff illness and consequent absence, leaving them with no chance of taking preventative measures. The extent of other health issues in the workforce depends on many factors including age and gender. They may include a range of conditions from back pain and other musculoskeletal disorders. Changes in shift patterns may affect bio-rhythms, causing discomfort, reducing productivity. They could even trigger depression. To mention a few.

There is a lot to measure don’t you think? So what is stopping us measuring, recording, reporting, assessing and adjusting? What is stopping us generating a real positive impact on our human capital expense?

Well, you probably don’t have a system that does it – or rather, that does it well. Of course, no software system can simply resolve mental health issues, alcohol or substance addiction or back pain – but Warwick International’s eSAFETY (H&S) and eOPAS (OH) family of software solutions does it. We are the only solutions company who focus on both Occupational Health and H&S solutions.

Our solution shows patterns which can inform company policies over H&S exposures and sophisticated OH health surveillance supports ill-health prevention interventions.

It offers automated trend analysis and highlights records which require further attention. Its dashboard creates reports to the user’s specific requirements and employees and employer can be comforted and assured that their own and company confidential information is secure, held reliably, 24×7, in the IBM cloud that our solutions are built upon.

Drop by and discuss the potential of working with Warwick International. We exist to make you more effective.

Data, Information, Knowledge.