Corporate Impact On Long Term Economic Performance

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Safety is an essential ethical requirement. Strategies for safety are used not only to reduce estimated probabilities of injuries, but also to cope with hazards and eventualities that cannot be assigned as meaningful probabilities. Safety is concerned with avoiding certain classes of events that are morally right to avoid (Zohar and Lauria, 2005). Traditional reliance on safety engineering and identification of human error is no longer sufficient to achieve increasingly higher safety goals. Tremendous cultural changes are taking place right now in organizations, and the safety profession will have to change to keep up. Cultural change involves changing the basic values, norms, beliefs, etc, among members of the organization in order to improve organizational performance. It is imperative for the safety professional to understand how culture affects organizations and to understand its impact on safety performance. A supportive company safety culture based upon new assumptions is key thing to do in achieving breakthrough safety performance. Without a supportive culture, even the best designed safety processes or programs will eventually fail. The deepest root cause accident investigation technique will be stumped and stopped in its tracks by a mistrustful, cover your back, blame-the-other-guy culture dominated by norms of concealment (Gertler, 2004).

In the case study under discussion Type II Grassroots-Driven Strategy has been followed successfully. Key to the success of an authentic, sustainable culture change include engaging and empowering union employees in the process; customizing interventions; and implementing those interventions in two phases-first village by village, then utility-wide. The key element of an effective safety culture has been identified as the manner by which an organisation disseminates safety information on risks and hazards. It results from a combination including an informed culture, a reporting culture, a just culture and a learning culture (O'Reilly, Chatman and Caldwell, 1991).

The three different strategies defined by (Simon, 2001) are

Type I Top-Down Strategy

Type II Grassroots-Driven Strategy

Another success story of type II strategy is Lawrence Livermore National Laboratories. Although culture change driven from the grassroots level, whether by an individual employee or a team, cannot be accomplished without support from management, the catalyst is clearly located within the rank and file; the momentum spreads through the organization from the bottom up. The critical difference between a bottom-up change process and the more conventional top-down approach is lodged in the sharing of responsibility and power between management and grassroots leaders. Lawrence Livermore National Laboratories (LLNL) is a Department of Energy site. A grassroots initiative to alter the safety culture originated in its Plant Engineering Department-450 crafts people (carpenters, plumbers, electricians, mechanics, welders, custodians, pipe fitters, metal workers) engaged in fourteen different maintenance and operations trades. By analysing LLNL's change process, which was guided by the principle of matching the culture change strategy to their management style, by working within the structure of the existing Safety procedures by the safety department. Also they took an approach in which they believed in order to advance the organization in the right direction for safety procedures, a higher degree of employee involvement is necessary. The fundamental goal of institutionalizing active participation in safety, of involving every member of the workforce in thinking about safety for his/her self and co-workers, of stepping forward to identify things that weren't right and suggest improvements, precisely with the foundation of an continuing grassroots culture change, and that is empowering the workers. Empowerment is not about titles and charters; it is about bestowing real decision-making power on individuals who previously had little or none (Cray & Mallory,1998). The LLNL Maintenance and Operations Safety Culture Committee members, all workers (with one non-voting management representative), learned how to conduct effective team meetings, how to bring out safety concerns from their constituent craft areas, and how to tap supervisory and professional support. The numbers proved they were getting results. Once they understood the critical relationship among major accidents, minor accidents and near misses, for example, they embarked on a near-miss reporting cause that achieved a greater than 75% participation rate. By the third year, accident rates in their department had been markedly reduced, with a decline in lost workdays from 455 to 265 and in restricted workdays from 372 to 42; workers' compensation costs were down 80%, a savings of more than half a million dollars a year. In grassroots safety, management have to have teeth, the ability to make things happen, get things done. If workers are simply appointed to teams that management continues to manage, they recognize the same old hierarchy in disguise and resent the hype; their incentives would be bitter and their interest rapidly flags. This doesn't mean that management has to give them a blank check, but it does mean partnering on everyday safety and supplying the resources to follow through. Instead of passing suggestions up the chain of command for possible enactment, workers are mandated to research their ideas and see them through to completion (Simon, 2001).

Type III Driven by Process Champion

All these safety improvement efforts result in the change in the Cultural Model. But each represents a particular strategy, in keeping with the Model's distinguishing principle of customizing interventions to the specific culture of the client system instead of opting for cookie cutter programs. A behaviour-based project could increase the number of safe behaviours while stopping short of impacting the organization's core values. Authentic culture change transforms the organization's core values change as well (simon,2001).

Culture change is difficult and time consuming because "culture" is rooted in the collective history of an organization, it is not developed overnight, it takes years for an organization to develop it, which makes it even harder to identify, because so much of it is below the surface of awareness (Godley & Westall,1996).


It's clear from the above graph that culture change is an ongoing process, so it’s very hard to identify organizations that have "completed" a successful culture change. We can, however, find examples of change-in-progress. As we look at another one of the same type of strategy implementation in Grassroots Safety Culture. The safety culture of an organization can be improved upon through the involvement of the facility workers. In 1990, the plant engineering department at the Lawrence Livermore National Laboratories developed a grassroots safety culture. The cultural change and improvements from this worker-driven program have been far greater than expected. Workers' compensation costs have been reduced along with injuries and lost workdays. The program became so successful that it has blossomed into an annual safety conference and has attracted attendees from major corporations throughout the United States the in-depth study of the above case tells that the same strategy has been more efficiently applied and hence producing better results and in less time duration process is more efficiently applied. (Simon,2001).

Figure 4 in the PSE &G case study shows an increase in incidence rates after the first year of the applied cultural change process at the incidence rate rise to 3.21 which is even higher then what they started from. Another point worth analysing is the lack of consistency. The incidence rate seems to stabilize in 2008 and 2009 hence improving the situation but what needs to know is that whether the increase of incidence rate in 2009 is due to extraordinary circumstances or caused by any other factors. The phase 2 also starts in 2003 hence improving the situation here onward.

Levi-Strauss is another company that did engage in a purposeful culture change process. In 1985, a group of minority and women managers requested a meeting with the CEO, complaining of discrimination. The CEO convened a three-day facilitated retreat at which white, male managers engaged in intense discussions with minority and female managers. These discussions revealed that there were, indeed, hidden attitudes in the organization that were in conflict with its espoused values. Since that time, Levi-Strauss has worked hard to generate cultural change. The company developed an "Aspiration Statement" including desired beliefs, attitudes, and behaviour. The statement specifies the company’s commitment to communication, ethical management practices, employee empowerment, and recognition for those who contribute to the mission of the company. Employees at all levels also participate in training sessions on leadership, diversity, and ethics. Employee evaluations are based partially on how well they support the Aspiration Statement. (Cummins and Whorley, 2008).

The cultural change should have been processed utility wide from the start as it turns out to be a more beneficial and efficient way to address the problem. Enlisting the union supervisors as leaders is also a big breakthrough in the system achieved by this cultural change process. And as mentioned in the case study it turns out to be so that it was adopted by nearly every electric and gas location in the company.

Through this case study explains the explains the cultural changes happened in PSE&G over the period of nine years, it can easily understood that Workplace safety affects virtually all other elements of an organization, including production, quality, job satisfaction and expenses. By focusing on improving safety, companies can improve other business outcomes as well. Cultural -based safety is one of several change models a company can use to guide this organizational improvement process.

By positive results cases such as the Livermore, the case study under discussion, Organizations are beginning to understand how effective these cultural and behavioural -based interventions are, however the question that needs to be answered remains the same. What does it take for more people to become interpersonal change agents for occupational safety and health? Data below (PSE&G,2010) shows the long-term effects of the implementation on recordable incident rates, lost-workday case rates and direct costs of injuries. The implementation contributed to decreases in recordable injuries, lost workday cases and workers’ compensation costs, and promoted desired changes in the organization’s safety culture. The lost workdays have decreased consistently. This means that the strategy applied efficiently in this sector may not be beneficial in case of incidence rate in future.

In the grant proposal, the purpose of the program was described as including goals of improving relations among all parties and creating a more effective, cooperative team. Program activities, including work in cross-constituency groups, which helped to make the team image more of a reality.

Although the application of the whole process took nine years but the training programs were limited to the leaders which may be the supervisors or the higher management whereas the on ground workers were not invaluably involved in any phase of the programs. It is a dilemma of our ways of work that the management are always busy in different programs while on the ground worker who actually face the problems are not individually involved.

A very important point that needs to be addressed here is Safety assessment. we have relied on incident, injury and financial data to measure the bottom line in safety, but recently we have become dissatisfied with their limitations: post-accident statistics do not tell us what we need to know to prevent the next incident. Incident statistics just measure failures after the fact; they do not identify system error or evaluate safety programs. (Steven I. Simon, 2001).

Safety barriers are arranged in chains, so that each barrier is independent of its predecessors if the first fails, the second one is still intact. The first barriers prevent accidents; the second barriers limit the consequences of an accident and rescue services as the last resort (Butler,1991).


Culture change is a long-term process and positive results are achieved, but a 100% outcome is rarely achieved. Consistent result in every sector may or may not be achieved .Improvements beyond safety programs to the surrounding culture will also be made by this process. The interventions are vital for these processes to complete. There is no direct formula to get the perfect results. Every employee should be engaged and empowered every from the start to provide genuine grassroots leadership. A promising support from management is required to make any change in the organization. In this case utility wide cultural change should have been applied in parallel to village by village cultural change. All the steps included in the process needs to be repeated over a long period of time. As new members enter the organization, they should be surrounded with clear messages about the culture they are entering hence Reinforcing the desirable behaviour.

PSEG was recognized by New Jersey Monthly magazine as one of their 2009 Great Places to Work which also indicates an overall success of this safety management program. (PSE&G,2010)