Safety, Health, and Competition in the Global Marketplace Chapter 5 Safety, Health, and Competition in the Global Marketplace

Major Topics Competitiveness Productivity Quality How Safety and Health can improve Competitiveness

How can global competition have a negative impact on safety and health in the work place To survive and prosper in today’s global marketplace, industrial companies must be competitive. Competing in the global marketplace has been described as the equivalent of running a race that has no finish line. The need to achieve peak performance levels day after day put intense pressure on companies, and pressure runs downhill. This means that all employees from executive-level managers to workers on the shop floor feel it. This can create an atmosphere that can increase the likelihood of accidents, and lead to shortcuts that can increase potential health hazards.

Competitiveness The Institute for Corporate Competitiveness defines competitiveness as: The ability to consistently succeed and prosper in the marketplace whether it is local, regional, national, or global.

Characteristics of the most competitive companies 1. Consistently outperform their competitors in the key areas of quality, productivity, response time, service, cost, and corporate image. 2. Continually improve all of these areas.

Continual improvement The two key concepts associated with competitiveness are peak performance and continual improvement (quality, productivity, response time, service, cost, and corporate image). The process of improvement must be continual. In order to compete, industrial companies must continually and consistently combine the best people and the best technologies with the best management strategies. The productivity record of today will be broken tomorrow. What is world class quality today will be mediocre tomorrow.

Productivity and value added Productivity is the concept of comparing output of goods or services to the input of resources needed to produce or deliver them. Value added is the difference between what it costs to produce a product and what it costs to purchase it. The difference represents the value that has been added to the product by the production process. Value added is increased when productivity is increased.

How to recognize declining productivity Productivity is declining when: 1. Output declines, and input is constant, or 2. Output is constant, but input increases.

How to recognize improving productivity Productivity is improving when: 1. Output is constant, but input decreases; or 2. Output increases, and input is constant.

Relationship between productivity and quality Nothing has been gained if productivity is improved to the detriment of quality. When productivity is improved, quality must also improve or at least remain constant.

Quality Quality is a measure of the extent to which a product or service meets or exceeds customer expectations.

Rebuttal: A safety and health program is just a bunch of bureaucratic regulations that get in the way of profits Talented people working in a safe and healthy environment will be more competitive than equally talented people who are constantly distracted by concerns for their safety and health. In addition the most talented employees cannot help a company compete if they are slowed by injuries. Money that must be diverted to worker’s compensation, medical claims, product liability litigation, and environmental cleanups is money that could have been invested in the company to be more competitive/profitable.

Summary Competitiveness is the ability to succeed and prosper in the local, regional, national, and global marketplace. Productivity is a measure of output in goods and services. Quality is a measure of the extent to which a product meets or exceeds customer expectations. Safety and health contribute to competitiveness.

Home work Answer questions 3 and 10 on page 85. 3. What are the common characteristics of the most competitive companies? 10. Write a brief rebuttal to the following statement: “A safety and health program is just a bunch of bureaucratic regulations that get in the way of profits.”