1. Learning with Leading Indicators
“Working Together for Safety -- Exploiting the Natural Synergy between Safety Disciplines”
November 11, 2005
Steve Prevette,
ASQ Certified Quality Engineer
Fluor Hanford

2. Learning with Leading Indicators
Introduction
Fluor Hanford is making use of leading indicators and statistical methodology to assist in safety
We have achieved significant safety improvements – 87% reduction in OSHA case rate from 1996 to 2005
Use of leading indicators has correlated to a 55% reduction in OSHA case rate over past 24 months
Learning with Leading Indicators

3. Learning with Leading Indicators
Results
Learning with Leading Indicators

4. Learning with Leading Indicators
Use of Leading Indicators has had a profound effect at Fluor
Increases visibility to safety and production processes
Requires understanding of leadership and how to use data
Will show examples and stories
Will also help you with theory and use
Learning with Leading Indicators

5. D.O.E. Voluntary Protection Program
Simply complying with regulations is not sufficient for continual improvement
VPP has helped to focus
management and union
efforts and teaming
Leading Indicators fit in with
worksite analysis
Learning with Leading Indicators

6. Learning with Leading Indicators
Trending
Statistical Process Control is used at Fluor Hanford
- Standardized
- Proven
- Moves focus
away from
random noise
Trend
detection
Learning with Leading Indicators

7. Learning with Leading Indicators
SPC Description
Data are plotted in time sequence
Baseline average (center line) is added
Upper and Lower Control Limits are added, 3 standard deviations above and below the average
UCL and LCL represent the expected range of variation in the data.
Variation outside this range is circled (other rules are used in addition)
See the “Hanford Trending Primer” at
Learning with Leading Indicators

8. Common Trending Errors
Typical Behavior
Reaction
Action
Reacting to Ups and Downs (False Alarms)
Comparisons point to point, to average, to last year
Tampering and knee jerk reactions, frustration
When stable, work on long term history, fix the system
Failure to detect trend
No criteria to separate trend from noise
Molehill grows into mountain
Use SPC to detect trends accurately and in time
Learning with Leading Indicators

9. Learning with Leading Indicators
SPC Cost Savings
Not only more reliable, but less expensive:
Can automate retrieval and processing of data
Saves time (15 seconds per chart update, 5 minutes per new chart)
Actual case – reduction of time needed for charts from 40 hours per month to 15 minutes per month
Quicker read by executives, better comprehension
Allows risk minimization
Becomes integral to business model
Learning with Leading Indicators

10. The Red Bead Experiment
Helps by providing a hands-on, emotional
“a ha” experience
Fluor has script and video available, with ISMS and VPP focus
“Standard” management practices used, and then a better way shown
One hour with the Red Beads will accomplish more than years of discussion
Learning with Leading Indicators

11. Learning with Leading Indicators
Systems Thinking
Would putting a Rolls-Royce engine in a Geo Metro make an improved automobile?
Nothing wrong with either, but the combination probably won’t work (Russ Ackoff)
Learning with Leading Indicators

12. Systems Thinking Concepts
Pay attention to interactions more so than components
Knowledge of statistical variation more so than discrete numbers
Long term focus more so than short term
Cooperation more so than fear, blame and internal competition
Learning with Leading Indicators

13. Early Fluor Experience with Indicators
Annual Employee Training VPP survey
5 Hazardous Occupations
No. of Indicators from 300 per month to 1,600 but later dropped to 1,300
Good comments in VPP and DuPont reviews
In 2000, OSHA rate “flat-lined” at 1.5 cases per 200,000 hours
Learning with Leading Indicators

14. Jump Start with Leading Indicators
Just what are leading indicators, anyway?
Predictions of future? or
A means to create a better future?
Learning with Leading Indicators

15. Creating a Better Future
We have gotten distracted by calls to predict future, delaying development of leading indicators
At a low injury rate, little information exists in the outcome indicators
Trending response time long at these low rates
Use leading indicators to measure lower threshold data and activities
Quickens trend response, reduces injuries and improves outcomes
Learning with Leading Indicators

16. Our Current Leading Indicators
Events - First Aid Cases, Occurrences, Near Misses
Safety Inspections - Number and Score
Employee Input – Safety Concerns and Survey Responses
This list has changed, and will likely change as the need arises.
Statistical Process Control (SPC) is used.
Learning with Leading Indicators

17. Learning with Leading Indicators
Events
Learning with Leading Indicators

18. Learning with Leading Indicators
Safety Inspections
Learning with Leading Indicators

19. Learning with Leading Indicators
Employee Sentiment
Learning with Leading Indicators

20. Learning with Leading Indicators
Results
There were some recent trends that allowed management to stay ahead of issues
OSHA Recordable Case Rate has dropped 30% since start of use (Aug 03 – Apr 04 compared to May 04 – Jan 05)
Finished FY 2005 with lowest OSHA Recordable Case Rate yet
Allows focus on doing the right things right
Learning with Leading Indicators

21. Learning with Leading Indicators
Correlations
Note: Black line is OSHA Case Rate, Green line is the Leading Indicators
Learning with Leading Indicators

22. Learning with Leading Indicators
Correlations
Learning with Leading Indicators

23. A Color-Coded Dashboard
Integrated presentation for Leading and Lagging Indicators
Combines the best of “balanced scorecard” with the best of SPC
Better than rolling all data into one index
Allows a Systems Approach
Learning with Leading Indicators

24. Red Yellow and Green Control Chart Result Decision Color
Leadership Action
Stable
Level is Acceptable
Green
Stay the Course
Level is Not Acceptable
Yellow
Improve System
Trend
Adverse
Red
Corrective Action
Improving
Reinforce – Stay the Course
Learning with Leading Indicators

25. Use of “White” Addition of White to the dashboard can be advantageous:
Use White (or Yellow) for one month away from a trend
Use for stable at an okay level, but not superior
Minimizes some of the push to be “All Green” while allowing for opportunities for improvement
Learning with Leading Indicators

26. Learning with Leading Indicators

27. Learning with Leading Indicators
Conclusion
Tools and methodologies such as
Statistical Process Control,
Systems Thinking,
Surveys,
and Leading indicators,
Can provide insight for decision making
Learning with Leading Indicators

28. Learning with Leading Indicators
Conclusion
Leading Indicators provide insight and focus for leaders
Allows managers, workers, and safety professionals work towards one future, to build the future
Moves management focus forward toward prevention
Safety excellence is achievable, if you lead with and learn from your leading indicators.
Learning with Leading Indicators