1. Risk Tolerance in the Workplace
ExxonMobil Global Services Company William A Garnes
57 minutes (3 minutes per slide)
Introduce yourself and the topic. Set expectation for time and whether questions will be allowed during the presentation, or at the end.
< As appropriate, add conference name above the title, and personal details (e.g., contact info) on the bottom of this slide >
Exxon Mobil Corporation has numerous subsidiaries, many with names that include ExxonMobil, Exxon, Esso and Mobil. For convenience and simplicity in this presentation, the parent company and its subsidiaries may be referenced separately or collectively as "ExxonMobil." Abbreviated references describing global or regional operational organizations and global or regional business lines are also sometimes used for convenience and simplicity. Nothing in this presentation is intended to override the corporate separateness of these separate legal entities. Working relationships discussed in this presentation do not necessarily represent a reporting connection, but may reflect a functional guidance, stewardship, or service relationship.

2. Introduction to Risk Tolerance
In this seminar, we will discuss:
Our Journey
Understanding Risk and Risk Tolerance
Ten Key Factors that Influence Risk Tolerance
What you can do

3. Our Journey Safe Facilities Safe Operations Safe People The Result?
Incident Rate
Three segment chart, three bottom-left oval segments, intersecting. Laid out top left, middle, lower right (waterfall)
Injury Rate on Vertical Axis, (t) on the horizontal axis
Animation:
Highlight top left segment with text to the right “Safe Facility”. Design and engineer safety into the site. OSHA has lots of regulations and documents regarding how to do this. But, there came a point where our success tapered off, and we needed a “step change” to continue reducing incident rate
Highlight middle section with text to the right “safe Operations”. Proper procedures, PPE and training,
Highlight lower right section – we perform observations, have safety programs, employee engagement: add the text “Safe People”
Time 

4. TRIR > 0 LTIR > 0 Who was getting hurt? New Staff
Experienced Staff
Leadership
Why are people still getting hurt?
Sequence of decisions…
TRIR > 0
LTIR > 0
What was the result of all of our efforts? <CLICK> to reveal Total Recordable Incident Rate and Loss Time Incident Rate
People were still getting hurt. So, we analyzed the incidents <Click> to Reveal first question
To determine who was getting hurt, if there was a segment of the population we could focus on <Click reveal the next three bullets>
Basically, there was not a statistical indication that one segment of the population was more prone to injury than any others.
This led to deep consideration of the question <CLICK> to reveal 2nd question
Why are people still getting hurt? We determined that often when people get hurt, there were some decision points along the way <CLICK> to reveal last bullet
And the thought that go into the decision process we have come to refer to as RISK TOLERANCE <CLICK to NEXT SLIDE>

5. Risk Tolerance
Risk tolerance involves a number of factors that influence a personal decision to either accept or reduce risk
Risk tolerance involves a number of factors that influence a personal decision to either accept or reduce risk. We each perform decisions all day everyday about how we interact with the world around us. When we perceive RISK, we make choices based on our understand of the risk, but just as important, how we personally feel about the risk.
<CLICK> for first picture
Consider this fellow, or anyone who likes Extreme Sports. For some, the more extreme the challenge, the more willing they may be to try. In this individual's mind, the thrill and the adrenalin rush make the RISK “worth it”
<CLICK> for 2nd picture
Not extreme, but still some danger. If this fellow’s job is to work on this truck, what are some other things he could do to reduce the RISK ? <allow some time for responses> <If no one has offered suggestions, comment that one of the trucks can be moved away, or wheel blocks on the FRONT wheels could be used….so, if someone plans to remove the wheel blocks, at least they will come up to the front of the truck where he is working>
After brief discussion <CLICK to NEXT SLIDE>

6. Understanding Risk and Risk Tolerance
Identify the Hazard
Perceive the Risk
Mitigate the Risk
Safe Outcome
To have a safe outcome, this is a simplified version of the thought process that we want our employees to follow.
First and most important, the hazard must be identified. If the hazard is not identified, things can go wrong very quickly. Almost as important as identifying the hazard, is perceiving the risk.
At this point, the individual or team can determine the best way to mitigate the risk to result in a safe outcome. This can take many forms…obtaining proper equipment or PPE, seeking expertise inside or outside of the organization, waiting for more help or favorable weather conditions, and many more…
This is very simplified, but would you agree that this is representative of what goes on in your organization? <allow time for one or two responses>
<CLICK to NEXT SLIDE>

7. Understanding Risk and Risk Tolerance
Identify the Hazard
Perceive the Risk
Tolerate the Risk
LUCK
Incident
Now, when high Risk Tolerance enters the picture, things can turn out very differently. The hazard is successfully identified, and we perceive the risk…
But then, like the fans of extreme sports, we accept the risk and go ahead anyway. Sometimes we are lucky, but sometimes….<CLICK> to hide LUCK and reveal INCIDENT icon
We end up having an incident causing harm to a person or persons, facility or equipment loss, release of gasses or liquids to the environment, etc., as applicable to your business
Our brief study of RISK Tolerance will help us to understand WHY individuals behave in ways to accept too much risk, to rely on LUCK.
<CLICK to NEXT SLIDE>

8. 10 Key Factors that Influence Risk Tolerance
Overestimating Capability or Experience
Familiarity with the Task
Under-Estimating Seriousness of Outcome
Voluntary Actions and Being in Control
Lack of Personal Experience with an Outcome
Low Cost of Non-Compliance
Over-Confidence in the Equipment
Over-Confidence in Protection and Rescue
Potential Profit or Gain from Actions
Role Models Accepting Risk
People are unique, and their thought processes and reasons for accepting risk are all different. Most fall into these categories, which we call our 10 Key Factors that Influence Risk Tolerance
<Read only the BOLD TEXT>
Overestimating Capability/Experience
Over estimating physical capability is the belief that incidents and injuries won’t occur because the worker has the physical capacity or learned wisdom to withstand or avoid them.
Familiarity with the Task
Complacency occurs when a worker completes a task successfully many times and has the skill to complete it successfully without thinking. The potential for work execution without having to refocus or refresh can create a blindness to the hazards and risks, thereby increasing risk tolerance due to familiarity.
Seriousness of Outcome
Generally, the more serious the outcome, the less tolerant we tend to be, but we also tend to underestimate or discount how bad or serious the outcome could be.
Voluntary Actions and Being in Control
If there is something we personally want to do we will discount the risks associated with the activity to justify our participation. We also prefer to have more ‘control over our destiny’, even if that presents greater risk (e.g. driving vs flying)
Personal Experience with an Outcome
A personal experience with a serious or traumatic outcome will stick with an individual for a long time, sometimes a life time. It will impact their decisions on similar tasks and usually results in the individual being very intolerant and not accepting of any risk associated with the task.
Cost of Non-Compliance
A person’s decision to accept risk can be influenced by how high the cost of non-compliance will be. If the cost of non-compliance (e.g. taking a risk) is going to be very high, the person may decide to conduct themselves in the manner that will not result in the cost or penalty.
Confidence in the Equipment
Overconfidence in the equipment, occurs when we have placed excessive and some times unwarranted trust that the equipment or tool we are using will always perform exactly as designed. The possibility that the equipment could in fact fail is not considered, or is discounted or minimized
Confidence in Protection and Rescue
Deals with over confidence in the safety and personal protective equipment we use and the belief that if something does go wrong, our PPE will protect us from harm.
Potential Profit & Gain from Actions
Stems from the desire for profit, gain, and even recognition. This can occur at an individual level where a person may profit from their own action or it can occur at the corporate level where a company or business can profit from taking higher risks.
Role Models Accepting Risk
The level of risk accepted by our role models and mentors will directly impact the level of risk we as individuals are prepared to accept. The actions and risk acceptance of the role models can impact an entire work group’s acceptance of risk.
It is just ‘accepted’ as the ‘norm’ and not questioned. The actions of the role model become the group ‘norm’ and ‘the way it is done around here’ with no thought to the risk associated with it.
During the rest of our time together, we will discuss each of these topics and point out some key traits to look out for, and what we can do to improve (reduce) our Tolerance for Risk

9. Overestimating Capability or Experience
Belief that fitness or ability will prevent accident or injury
Famous last words:
“I can handle it. I am strong and fit…”
How to mitigate:
Strength and agility does not reduce the risk in the workplace
Consider less risky alternatives to accomplish the same task
Overestimating Capability/Experience
Over estimating physical capability is the belief that incidents and injuries won’t occur because the worker has the physical capacity or learned wisdom to withstand or avoid them.
Share the story represented by the image
Discuss the “famous last words” that portray an individual’s attitude as they engage in this behavior and ACCEPT THE RISK
Discuss ways to identify and correct this behavior

10. Familiarity with the Task
Risk awareness decreases with repetitive tasks
“What procedure manual? I know what I’m doing, I’ve been doing this forever...”
How to mitigate:
Each time like the first time
Perform the task in the way you would teach someone else to do it
Familiarity with the Task
Complacency occurs when a worker completes a task successfully many times and has the skill to complete it successfully without thinking. The potential for work execution without having to refocus or refresh can c
Discuss the “famous last words” that portray an individual’s attitude as they engage in this behavior and ACCEPT THE RISK
Discuss ways to identify and correct this behavior
reate a blindness to the hazards and risks, thereby increasing risk tolerance due to familiarity.

11. Under-Estimating Seriousness of Outcome
Belief that outcome will not be that bad
“Even if something were to happen, no one will get seriously hurt…”
How to mitigate:
Consider the absolute worst-case outcome based on the current task
Think of the seriousness of the outcome, not probability
Seriousness of Outcome
Generally, the more serious the outcome, the less tolerant we tend to be, but we also tend to underestimate or discount how bad or serious the outcome could be.
Discuss the “famous last words” that portray an individual’s attitude as they engage in this behavior and ACCEPT THE RISK
Discuss ways to identify and correct this behavior

12. Voluntary Actions and Being in Control
Considering risk to be low when you are in control
“I can figure out how to do this; I don’t need to call the right person to do this task…”
How to mitigate:
Never assume that because you take control of a risky situation that the risk has changed any!
Voluntary Actions and Being in Control
If there is something we personally want to do we will discount the risks associated with the activity to justify our participation. We also prefer to have more ‘control over our destiny’, even if that presents greater risk (e.g. driving vs flying)
Discuss the “famous last words” that portray an individual’s attitude as they engage in this behavior and ACCEPT THE RISK
Discuss ways to identify and correct this behavior

13. Lack of Personal Experience with Outcome
Accepting the risk based on your own experiences
“I did it this way last week, and nothing went wrong…”
How to mitigate:
Incident sharing
Don’t depend on luck
Personal Experience with an Outcome
A personal experience with a serious or traumatic outcome will stick with an individual for a long time, sometimes a life time. It will impact their decisions on similar tasks and usually results in the individual being very intolerant and not accepting of any risk associated with the task. But until we have a bad outcome, risky behaviors are reinforced
Discuss the “famous last words” that portray an individual’s attitude as they engage in this behavior and ACCEPT THE RISK
Discuss ways to identify and correct this behavior

14. Low Cost of Non-Compliance
Apparent low-cost of not following the rules
“These procedures are way too detailed; nothing will actually happen if you skip a few of these extra steps…”
How to mitigate:
Incident sharing
Deterrent: company applies consequences for unsafe and risky behavior
Cost of Non-Compliance
A person’s decision to accept risk can be influenced by how high the cost of non-compliance will be. If the cost of non-compliance (e.g. taking a risk) is going to be very high, the person may decide to conduct themselves in the manner that will not result in the cost or penalty.
Discuss the “famous last words” that portray an individual’s attitude as they engage in this behavior and ACCEPT THE RISK
Discuss ways to identify and correct this behavior

15. Over-Confidence in the Equipment
Excessive trust that equipment will not fail
“I never go though that pesky equipment checklist; I know that it worked just fine last time I used it…”
How to mitigate:
Check your equipment before use
Obey equipment limitations and maintenance schedules
Confidence in the Equipment
Overconfidence in the equipment, occurs when we have placed excessive and some times unwarranted trust that the equipment or tool we are using will always perform exactly as designed. The possibility that the equipment could in fact fail is not considered, or is discounted or minimized
Discuss the “famous last words” that portray an individual’s attitude as they engage in this behavior and ACCEPT THE RISK
Discuss ways to identify and correct this behavior

16. Over-Confidence in Protection and Rescue
Expectation that others will provide care in case of injury
“There are plenty of people around here. If something happens, they will help me…”
“That’s what PPE is for…”
How to mitigate:
Analyze your situation to prevent harm, rescue may not be readily available
PPE is not invincible!
Confidence in Protection and Rescue
Deals with over confidence in the safety and personal protective equipment we use and the belief that if something does go wrong, our PPE will protect us from harm.
Discuss the “famous last words” that portray an individual’s attitude as they engage in this behavior and ACCEPT THE RISK
Discuss ways to identify and correct this behavior

17. Potential Profit or Gain from Actions
Accepting risks and short-cuts for personal gain
Not necessarily financial gain, e.g., finishing a task quickly in order to leave early (or on time) for a break, lunch end of shift, weekend, etc.
How to mitigate:
Do not accept risk to save the company money
Do not sacrifice safety to meet or beat the schedule
Potential Profit & Gain from Actions
Stems from the desire for profit, gain, and even recognition. This can occur at an individual level where a person may profit from their own action or it can occur at the corporate level where a company or business can profit from taking higher risks.
Discuss the “famous last words” that portray an individual’s attitude as they engage in this behavior and ACCEPT THE RISK
Discuss ways to identify and correct this behavior

18. Role Models Accepting Risk
Observation of mentors and other leaders accepting risk
“The boss rarely wears PPE, so what’s the big deal…”
How to mitigate:
Leadership drives culture
Supervisors, senior employees, mentors must “Walk the Talk” and provide visible safety leadership
YOU are a safety leader
Role Models Accepting Risk
The level of risk accepted by our role models and mentors will directly impact the level of risk we as individuals are prepared to accept. The actions and risk acceptance of the role models can impact an entire work group’s acceptance of risk.
It is just ‘accepted’ as the ‘norm’ and not questioned. The actions of the role model become the group ‘norm’ and ‘the way it is done around here’ with no thought to the risk associated with it.
Discuss the “famous last words” that portray an individual’s attitude as they engage in this behavior and ACCEPT THE RISK
Discuss ways to identify and correct this behavior

19. How do I use the Risk Tolerance Factors?
Review incidents to identify contributing Risk Tolerance Factors
Focus on the most common
Implement targeted program to combat specific Risk Tolerance factors
Share how the Risk Tolerance Factors can be used to reduce unsafe behaviors at their sites.  For example, worksites should review their past incident investigation reports and determine which risk factors contributed to their incidents.  Once you identify 1-3 primary risk factors (most common), then management focuses on a targeted program to combat those specific risk tolerance factors (via personnel training only on those specific factors, campaigns by leadership, etc.).
may have already been doing some of these things, have they been successful? Understanding these 10 Key Factors will go a long way toward recognizing the root of this behavior in your workplace

20. Assessing Risk Tolerance
Team chose a strategy to systematically assess safety attitudes and behaviors in all new employees as a predictor of on-the-job safety performance
Integrated into the new-hire process
Two benefits:
Use overall assessment results to help develop site Safety Security Health and Environment programs appropriate for the population in this region
Use individual test results to provide individual feedback regarding specific areas of Risk Tolerance.
As an example, I will share with you what we are doing in ExxonMobil. At one of our sites, we are actually using a tool to measure Risk Tolerance, and integrating the results into individual development planning.
There are options to test pre-hire (exclude candidates) or post hire (employee development); We selected a post-hire strategy that fit in with the over vision for the new location.
Project team proposed, Stakeholders agreed; this is a choice your organization will have to address as well.
This approach enabled us to use existing tools, techniques and training as appropriate for each individual to reduce their Risk Tolerance
ExxonMobil Use Only

21. What are we measuring?
One study [this page] has shown that lowest scoring 20% of employees are responsible for approximately 45% of the safety incidents
As plans developed to open a new office, we saw a unique opportunity to build safety success into the new location, by assessing an individual’s safety mindset and attitude early in their career. Many of these new hires were college graduates, and this would be their first job in a major corporation. We needed a strategy to help ensure a successful establishment of OUR safety culture in this new office.
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All rights reserved.
Approved for ExxonMobil Usage - Commercially confidential
ExxonMobil Use Only

22. Risk Tolerance Assessment Workflow
Prepare
All staff have had an Introduction to Safety
All supervisors have had Safety Leadership Training
Introduce the organization to Risk Tolerance
Take Assessment
Employee receives link to Risk Tolerance assessment
Employee takes on-line assessment (20 min)
Employee receives Development Report
Feedback
Supervisor and employee use Development Report as a basis for meaningful two-way communication and development planning
Use available company resources to reinforce these principles
In summary, this is the process that came about as a result of our plans to assess for Risk Tolerance
(highlight the three stages, review the bullets on the slide)
As for the particular tool we use, I’m not here to promote one vendor product vs. another. As mentioned earlier, this approach fit in with our overall strategy for the new business unit; you will want to survey the available tools and options and determine what fits best with your organization's goals and culture
When we reduce Risk Tolerance, we move toward our goal of a workplace where
Nobody Gets Hurt
ExxonMobil Use Only

23. BACKUP

24. Individual Development Report
The development report allows the employee and supervisor to have a discussion and agree on which areas to focus first; we’ve provided a mapping document that relates the Assessment Components to one (or more) risk tolerance factors
Each employee receives individual development report
Enables meaningful one-on-one discussion with supervisor