Canada's Certified Safety Professionals and Specialists ©

Monthly Archives: January 2015

Xi Safety on Remote Sanitation

untitled3

Xi Safety is pleased to announce that we are the Distributor for Pacto Waterless Toilet system.

Pacto – the versatile waterless emergency toilet

Sanitation is important, wherever you are. Running water, sewage and electricity are luxuries in many parts of the world. Access to a good, hygienic toilet does not have to be. Pacto is the ideal alternative to traditional water-flushing toilets. With a unique waste management function, it delivers higher standards of comfort and cleanliness.

The waste in encapsulated in a durable foil after each visit, so there is no direct contact with the waste matter. This remains the case even after emptying, as the entire bag of waste is disposed of whole.

Unlike most alternative toilets, such as composting toilets, there is no requirement for electricity, since no composting process actually takes place in the toilet itself. This also means that the smells and high maintenance associated with composting toilets are kept to a minimum.

A mechanical seal at the bottom of the toilet means you are never faced with any unpleasant sights or smells.

Quite simply, the Pacto is a dry toilet that offers the same standards of hygiene and user-friendliness as a water toilet.

This means that you can benefit from modern comforts in any environment. Also, Pacto offers a more environmentally friendly means of handling waste; instead of dirtying precious water, it gives you the chance to recycle the waste

Pacto is a waterless toilet for use anywhere. There are no installation requirements. No need for water, electricity or batteries. With Pacto, a toilet can be up and running within minutes. Whether you are going camping even with your RV, water and holding tanks are always an issue if you are long term without sewer hookups.

Pacto is perfect for you lakeside cabin or bug out survival pad as there is no need to worry about water.

Among the many deployments are military operations, remote work camps, field hospitals, construction work sites, mines, disaster relief operations and civil defence.

Pacto can also be operated with no environmental footprint.

For a one time small investment, small contractors, recreation enthusiasts and emergency planning, Pacto kits are now affordable for anyone.untitled2

 

How to Trim Costs Without Cutting Into Safety

ince price of oil has plummeted from its lofty perch like Icarus,companies will have to implement cost controls in order to survive. This puts management in a Catch-22: cut costs too little, and you go out of business, cut costs too much or in the wrong area, and you could see a cost explosion as workplace incidents rise. Here’s how to find the sweet spot between the sun and the sea.

Direct + Indirect Costs & Break Even Revenue

As we hinted at in past articles HERE and HERE, the costs associated with workplace incidents snowball beyond the obvious. Consider this example:
A drilling rig crew rolls their crew truck while driving from the work camp to the drilling rig. The following facts have been determined:

1. The crew truck is a write off, and the total value of the truck is $50,000.
2. The crew made it to the rig an hour late.
3. All crew members were evaluated by the work site Medic and reported no pain.
4. The following day, the Driller wakes up and finds he has a stiff neck.
5. The Driller is taken to the hospital for a physician’s assessment, and this results in a $40,000 Worker’s Compensation Claim.
6. The Rig Manager has to train the Derrickman to take the Driller’s position until the company can bring in a Driller from an idle rig.

These are just the direct costs, and likely fall in the range of $100,000. However, the indirect costs can be a multiple beyond that. There’s the opportunity costs of lost future contracts due to the increased incident rate. There is the loss of safety bonus days for the rig crew. Also, there are administrative costs to investigate the incident, manage the WCB claim, lost productivity, training, hiring, and implementing corrective actions to prevent recurrence. Typically, Indirect Costs are a multiple of 5 times Direct Costs, which looks like this:

Direct Costs: $100,000
Indirect Costs: $500,000

Total Incident Related Costs: $600,000

These costs will eventually show up on the drilling contractor’s balance sheet at year end, but they may not be attributed to the workplace incident. If all drilling contractors in the industry are experiencing similar incidents, then this forces the average rig day rate upwards, raising the cost of drilling wells.

In a high market, where the drilling contractor can command a premium for their rigs, their operating margins (Revenue-cost) might be higher. Let’s say they are flying high at 20%. How much revenue does the drilling contractor have to earn to cover the costs of this incident?

Break Even Revenue (BER) = Total Incident Cost/Margin%

BER = $600,000/0.2

BER = $3 million

For every dollar in total incident costs, the drilling contractor has to earn $5 to recover these costs. And this is in a high market where cash flows are strong. To see this graphically, it’s basically a reciprocal function of 1/x:

BER

Think of this graph like Icarus: when margins are too low, it becomes impossible to break even on workplace incident costs. If margins are too large (beyond the 20% in this graph), then hubris can set in, and a contractor can care too little about workplace incidents because these costs are easily repaid.

Root Cause Misdiagnosis

The Safety Manager of the company performs his incident investigation, and discovers that the crew was travelling 80 km/hr when they should have been following the client’s policy of driving 40 kms/hr. He has an Aha! moment and (incorrectly) concludes that speeding was the root cause of the incident. So everyone is sent for driver training, and the company installs Big Brother monitoring systems in all their crew trucks.

This corrective action is a SMART one, as it’s tangible, measurable and documented, and the company can demonstrate its due diligence for having taken actions to prevent recurrence.

 

Root Cost Analysis to the Rescue

There is a way companies can cut costs and improve safety at the same time. In order to do this, we have to re-frame our notions of what constitutes a workplace incident.

Typically, Root Cause Analysis is used to diagnose a misalignment of inputs that led to an unwanted occurrence, typically a workplace incident involving damage to people, property or planet. However, when we broaden our definition of an incident to an “unwanted occurrence”, then anything under the sun becomes fodder for a root cause analysis investigation, including scheduling delays, cost overruns, procurement issues and quality control issues.

Generally speaking, the Root Cause Analysis expertise within a company lies within the Health, Safety and Environmental groups, and is often a shared expertise with Engineering or continuous improvement experts within the organization. This is not always possible in smaller organizations who cannot afford to employ an array of internal subject matter experts.

However, Accounting, Human Resources and other functions within the organization have a couple of options. The first is to engage the internal Root Cause Analysis expert to assist with investigating any unwanted occurrence within the company. A better option is to train several people within the organization to become proficient with a Root Cause Analysis tool. (We are heavily biased towards TapRoot).

The most effective way to cut costs is to identify the root causes that led to higher than expected costs. That’s the only way companies are going to be able to trim resources without cutting into workplace safety.

If you’d like to boost your management team’s capacity to use Root Cause Analysis to improve your cost cutting, drop us an email at:

info@xisafety.com

 

SafeNomics: A Definition

Our company was founded on the following principle: everyone defines safety a little bit differently. People often ask us, what does “Xi” mean? Well, it’s deliberately ambiguous. But the way we like to define it is this way: X is a crossroads or intersection and the little i refers to the individual, industry, incorporated entity or injured party. Xi refers to someone who is at a crossroads, and faced with three choices: Business as usual, scrap safety altogether, or chart a new path.

Here is another way to define safety: go back to the first principles of the root words. What did this word originally mean?

Safety (noun)

The Latin word for Safety is Salus. Salus is defined as: health, safety, well-being, salvation / salutation. It comes from the early 14th century, from Old French sauvete, meaning “safety, safeguard; salvation; security, surety,”. Earlier: salvetet (11th centuryc., Modern French sauveté), from Medieval Latin salvitatem (nominative salvitas) “safety,” from Latin salvus (see safe (adj.)). See also: completeness, well-being, uninjured, whole.

Safety differs from security in that Safety refers to an inner certainty that all is well. Security refers to the absence of an external threat. Safety is internal, Security refers to the external.

Once we craft a philosophy of safety, we can begin to explore the fundamental laws that either enhance it or diminish it. The greek word for these laws is “nomos”.

Nomos

The Greek term for “law”. It is the origin of the suffix -onomy, as in astronomy, economy, or taxonomy. (Greek: law, order, arrangement, systematized knowledge of [something]; usage. Nomos refers to the dispensation of justice, based on laws, whether natural, man-made or customary.

 

SALUS + NOMOS = SAFENomics

We recently trademarked the word “Safenomics” and the Canadian trademark office asked us to flesh it out a little bit more. Safenomics is the application of economic concepts to Health, Environment, Safety and Security under the banner of Loss Prevention.

Our position is that safety needs to be simplified. We don’t need all the bells and whistles, the new hot-dang silver bullet, or a bunch of paperwork to improve safety. SAFENomics can be thought along these lines:

Managing Risk to Prevent Loss to People, Planet and Progress. 

SAFENomics and  Accounting

Father Luca Pacioli is known as the “Father of Accounting”. He did not invent, but rather “codified” the system of debits, credits and ledgers used by traders in Venice to keep the economy rolling. His work formed the foundation of modern accounting and it continues to evolve from there.

imm8820jacopo20de20barbari-luca20pacioli1

Have you ever wondered what the true cost of an incident is? For example, let’s say a crew of workers rolls their crew truck. The Safety manager gets a quote from the body shop for a $10,000 repair bill. But the costs don’t stop there. Here are some other costs to consider:

Administrative – cost to investigate the incident, to gather decision makers for meetings, report to client.

Non-productive time – Cost to source a new truck and have an employee drive it out to the site, the costs of phone calls with the repair and insurance companies.

3rd Party Costs – costs of property damage because the truck wrecked a bridge,

Opportunity costs – lost productivity because people were dealing with the incident, potential lost contracts because the Total Recordable Incident Frequency went above a certain threshold. Cost of lost productivity while workers were at the hospital to get a physician’s assessment.

WCB Claims Costs – one of the injured workers came back three days later with a sore neck, and now he needs to go for surgery to correct some spinal damage. Cost to WCB to send a private investigator to follow the worker and ensure he is not scamming the system. Cost of increased WCB premium rates and WCB claim.

Lost Time Incident Costs – The worker is staying home to heal, so we need to train his replacement and have the HR department hire another person.

The average WCB claim in oil and gas clocks in at $20,000. So it would seem that the total bill for this is $10,000 in truck repairs and $20,000 in WCB claims. However, these are the Direct Costs. The Indirect costs can be 5 times the amount of Direct costs, which would be:

$30,000 + $150,000 = $180,000

These indirect costs will show up on the company’s balance sheet at year end. But not all companies track their costs and tie them to an incident. Now here is where it gets interesting. How much revenue does the company have to earn to break even on these incident costs?

If the company has a net revenue of 10%, it will have to earn:

$180,000/0.10 = $1,800,000

This is why a single incident can absolutely cripple a company. It raises the company’s costs, which are passed on to the client through higher prices, schedule delays or the cost of re-work.

I’m sure you’ve heard that an ounce of prevention is worth a pound of cure. So how much money should the company invest into preventive measures, such as driver training, vetting driver’s abstracts, computerized vehicle monitoring, snow tires and such?

It depends on the frequency rate of the incident. If this is an annual incident, it is costing the company $180,000 per year to deal with vehicle accident costs. If the frequency is once every ten years, the company can amortize that out to $18,000 per year.

If you think your company can’t afford to invest in a safety program, what is the absence of a safety program costing you?

This is what we mean by Safenomics – tracking incident related costs within the organization and waking people up to the true cost of failing to invest in safety.

 

If you’ve got some thought on this, drop us an email at:

info@xisafety.com

 

 

Xi Safety Contributes to Altalink Heartland Transmission Project

Posted on

Recently, Altalink’s Heartland Transmission Project reached a successful completion, on time, under budget and with superior safety performance.

The project involved the construction of a high voltage line connecting the Heartland Region northeast of Edmonton to existing infrastructure in South Edmonton.

HeartlandAltaLink

But the project didn’t start out this way. Heartland kicked off with a series of incidents that led Altalink to reach out to us. We were able to send a trusted HSE Worksite Representative to diagnose the sources of Altalink’s concerns.

Over a period of three months, Xi Safety was present on the project to collect baseline observational data of the underlying issues, and we worked with Management to craft a Corrective Action Road Map to get the project back on track. Altalink management was responsive to our feedback and implemented many of our recommendations.

We want congratulate Altalink on the successful completion of this project, and thank the project management team for their proactive approach, foresight and demonstrated commitment to Safety.

If your project is kicking off on the wrong trajectory, or if you want to know how you can get safety back on track, give us a call. Let us know the answer to this one simple question:

WHAT CAN WE BRING TO YOUR NEXT PROJECT?

(403) 730-0806

info@xisafety.com