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Safety Indicators – Measuring Something That Didn’t Happen

May 29, 2013


What makes a company a “safe company?” I suspect that most people have a number of thoughts on this topic. However, if we’re honest with ourselves, there’s one metric for safety that everyone uses, even if only on an instinctual level: a safe company is a company that doesn’t have incidents (or at least any serious incidents) and an unsafe company does have incidents. It’s okay to admit it:  it’s a natural instinct and you can’t really help it. Our brains tend to look for easy associations. It’s sort of like saying that good basketball players will score more points. That’s pretty easy math (my favorite kind of math, by the way)—safe companies don’t have (serious) incidents. risk 121920903

The problem with this instinct is that it’s not always true. Consider the recent events in West, Texas, where a plant caught fire and exploded, killing 14 and devastating the nearby community.  Consider this question — was the company that owned the plant a safe company to work for the day before the incident? I think most people would agree that the answer is no. What if we asked the workers or the management of the plant on the day before the incident if they felt that the plant was safe —what do you think they’d say? Bear in mind that they had never experienced a serious incident like this before and the human mind predicts the future using the past, often leading us to overestimate how safe we are. I submit that if you were able to poll the workers the day before the incident, the majority of the workers would say that they felt safe at work.

They would answer yes because they are human. Like we discussed before, most peoples’ minds predict the future using the past. The problem is that the past is not a reliable indicator of future performance. Certainly, the past is instructive, but as Nobel Laureate Daniel Kahneman notes in his fantastic book Thinking, Fast and Slow:


Success = Talent + Luck


In everything we do the outcomes are determined by what we do (i.e. our “talent”) as well as seemingly random events (i.e. “luck”). So if you look at the outcome of any event you can attribute it to either the skill of the person or to just plain old dumb luck (or both).


To illustrate why this is crucial to safety management, consider a driver who fails to wear a seatbelt, has bad breaks, bald tires, and drives with one eye closed while texting. If this driver were to reach his or her destination without having an accident, would we say that this person drove safely? Of course not! This is why, as Todd Conklin says, safety is not defined by the absence of incidents or events. Rather safety is about the presence of controls. It’s not what happens that defines a safe company, but what they do to manage safety within the organization.


In the safety management world, this concept is becoming more and more prevalent. If you want indicators of safety performance you need to look at inputs, or what are more commonly referred to as leading indicators, rather than outputs, or lagging indicators. Typical lagging indicators that organizations use to measure safety performance are:


  • Recordable injury rates
  • Severity rates
  • Experience modification rates


To illustrate how these indicators work together, we can adjust Kahneman’s equation to say that:


Lagging Indicators = Leading Indicators + Luck


Lagging indicators are useful in helping organizations measure some aspects of safety performance, but they are not completely valid measurements because they are subject to variability (AKA “luck”). You can go a long time without having a serious incident. This means that your lagging indicators can suggest that you are doing all the right things, but disaster can be right around the corner. A classic example is the BP Texas City Refinery explosion in 2005 that killed 15 workers. The refinery’s lagging indicators were exemplary but created a false sense of security in some of the management, hiding the signs of impending danger.  Leading indicators, on the other hand, when well designed, measure the “talent” side of the equation and are independent from the variability, or luck, side of the equation.

In next week’s blog, we will take a closer look at leading indicators, examine why they are ideal for measuring safety performance, and discuss a simple process for designing quality leading indicators to measure risk at both the employee and organizational level.


Our Guest Blogger this week is Ron Gantt, CSP, ARM - Vice President of Safety Compliance Management. Ron has been an integral part of SCM for more than a decade. 

Guest Blog