4TH PROJECT AND CONSTRUCTION MANAGEMENT PROFESSIONS CONFERENCE

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1 4TH PROJECT AND CONSTRUCTION MANAGEMENT PROFESSIONS CONFERENCESANDTON, OCTOBER 2016 THE REALITIES OF CONSTRUCTION HEALTH AND SAFETY PROF JOHN SMALLWOOD DEPT. OF CONSTRUCTION MANAGEMENT NELSON MANDELA METROPOLITAN UNIVERSITY SOUTH AFRICA © 2014 : Prof JJ Smallwood

2 Introduction (1) According to the Construction Industry Development (cidb) (2009), during visits to construction sites by Department of Labour (DoL) inspectors: 1 388 notices were issued: 86 (6%) improvement notices 1 015 (73%) contravention notices 287 (21%) prohibition notices Furthermore, 52.5% of contractors were non-compliant (Reality) The disabling injury frequency rate (DIIR) is a rate, per hours worked, of disabling injuries due to all causes i.e. per 100 workers x hrs / yr: 0.98 (cidb, 2009) (Reality) Fatality rate per workers: 25.5 (cidb, 2009) (Reality) © 2014 : Prof JJ Smallwood

3 Introduction (2) The level of non-compliance engenders the questions:‘Why do some contractors not comply?’ ‘Why do some contractors comply?’ ‘Why do some contractors optimise performance?’ To this end a ‘Motivators for Addressing Construction Health and Safety (H&S)’ was conducted to determine: The reasons why contractors address construction H&S Their progression relative thereto Whether it is an evolutionary process or not © 2014 : Prof JJ Smallwood

7 ‘Failure of management’ versus ‘Accident’(1)There is no such thing as an ‘accident’ (Myth)! Traditional definitions include, among other: ‘An unplanned event’ Are ‘accidents’ unplanned? Absolutely not! Any review will indicate that they are meticulously planned by default i.e. through actions and or omissions Consequently, given that the five functions of management work are planning, organising, leading, controlling, and coordinating, then unplanned events such as ‘accidents’ = ‘failure of management’ (Reality) Philosophy and constitutes a state of mind © 2014 : Prof JJ Smallwood

8 ‘Failure of management’ versus ‘Accident’(2)Management of all built environment stakeholder organisations, including client, project manager, designer, and quantity surveyor, not just contractors © 2014 : Prof JJ Smallwood

10 ‘Failure of management’ versus ‘Accident’(4)A different kind of coincidence, a confluence of events that shakes us up. Can see and feel a significance in the randomness. Like pure chance, or just a coincidence. However, Jung refers to it as synchronicity. (p. 3) © 2014 : Prof JJ Smallwood

15 Importance of the project parametersTraditional project parameters of cost, quality, and time, take precedence over H&S in terms of the importance of project parameters An ‘image of contractors’ study (Smallwood, 2010): 26 image related aspects The mean scores below (between 1.00 and 5.00): Ranking Client related responses: Quality (4.75) and remaining within budget (4.75): 1st = Time performance (4.25): 8th Health (4.00): 11th Safety (3.75): 13th © 2014 : Prof JJ Smallwood

16 Cost of Accidents (CoA)Can be related to by all stakeholders as it can be expressed as a percentage of organisation business volume or value of construction Direct costs tend to be those associated with the treatment of injuries and any unique compensation offered to workers Indirect costs include reduced productivity for both the returned worker(s) and the team, clean-up costs, replacement costs, stand-by costs, cost of overtime, administrative costs, replacement worker orientation, costs resulting from delays, supervision costs, costs related to rescheduling, transportation, and wages paid while the injured is idle Direct costs are covered by workers’ compensation insurance, but indirect costs are borne by contractors (Hinze, 2006) © 2014 : Prof JJ Smallwood

17 Economics of Health and Safety (1)COA is estimated to be between 4.3% and 5.4% of the value of completed construction (Reality) Cost of implementing H&S is estimated to be : Between 0.5% and 3% of project costs (Smallwood, 2004) 1.6% of tender cost estimate and 1% of project cost (Smallwood, 2011) Benefits of accident prevention outweigh the costs of accident prevention by a ratio of approximately 3:1 (Ikpe, Hammond, Proverbs, and Oloke, 2011) Clearly a financial motivation for addressing H&S ‘H&S is a profit centre’ © 2014 : Prof JJ Smallwood

18 Economics of Health and Safety (2)However, the synergy between construction H&S and the other eleven project parameters (Smallwood, 2006) results in further financial benefits: environment; cost; developmental criteria; environment; productivity; public H&S; quality; time; client satisfaction; design team satisfaction, and worker satisfaction © 2014 : Prof JJ Smallwood

19 Values (1) Zwetsloot, van Scheppingen, Bos, Dijkman, and Starren (2013): 29 values and value-related factors as supportive to H&S Clustered around seven core values Seven core values grouped into three value clusters Positive attitude toward people and their ‘being’ characterises the first value cluster and is comprised of the core values of interconnectedness, participation, and trust The second value cluster is relevant for the organisational and individual ‘doing’, for actions planned or undertaken, and comprises justice and responsibility © 2014 : Prof JJ Smallwood

20 Values (2) The alignment of personal and organisational development characterises the third value cluster and is relevant for ‘becoming’, and is comprised of the values of growth and resilience © 2014 : Prof JJ Smallwood

21 Marketing, Public Relations, and ImageTQM related H&S phenomena, which contributed to the acquisition of work, indicate the indirect role and benefits of optimum H&S in construction marketing (Smallwood, 2005) Optimum H&S provides ‘better practice’ H&S GCs with a competitive edge, and increases their attractiveness to clients The ‘image of contractors’ study indicated the importance of H&S (de-linked) Majority of construction sector firms view H&S performance to be important in terms of commercial success due to its impact on tendering and their reputation [Brabazon et al. (2000) in Wright and Marsden (2002)] Clearly, performance relative to H&S affects clients’ perceptions of a contractor’s image, which in turn impacts on their reputation © 2014 : Prof JJ Smallwood

22 Research – Sample stratum14 Members of the East Cape Master Builders Association (ECMBA) who achieved places in the 2013 Regional H&S Competition Selected on the basis of: Commitment to H&S Achievement of a recognised standard of H&S performance Consequently deemed to be knowledgeable with respect to the process of H&S improvement Response - 9 Responses were received, which equates to a 64.3 % response rate © 2014 : Prof JJ Smallwood

23 Not ……………….…………………….. VeryResearch – Findings (1) Parameter Response (%) MS Rank U Not ……………….…………………….. Very 1 2 3 4 5 Cost 0.0 100.0 5.00 Schedule (Time) 11.1 88.9 4.89 Quality 22.2 77.8 4.78 Productivity 33.3 66.7 4.67 H&S 55.6 4.33 Environment 44.4 3.67 6 Table 1: Importance of project parameters to respondents’ organisations (MS: 1.00 – 5.00). © 2014 : Prof JJ Smallwood

24 Minor………...……….………..……… MajorResearch – Findings (2) ‘Motivator’ Response (%) MS Rank Un- sure Did not Minor………...……….………..……… Major 1 2 3 4 5 OH&S Act 11.1 0.0 77.8 4.75 Image 55.6 44.4 4.44 Construction Regulations (H&S) 33.3 Professionalism 66.7 4.33 Reputation 22.2 4.22 H&S is an organisation value 6 H&S is a moral issue 4.11 7 + Impact of optimum H&S on environment 8 Organisation H&S policy 9 + Impact of optimum H&S on cost 4.00 10 + Impact of optimum H&S on profitability 11 + Impact of optimum H&S on schedule 12 Preservation of organisational integrity 13 COID Act 14 National Constitution 15 Table 2A: Extent to which ‘motivators’ contributed to respondents’ organisations addressing H&S (MS: 0.00 – 5.00). © 2014 : Prof JJ Smallwood

25 Minor…..……….………..……… MajorResearch – Findings (3) ‘Motivator’ Response (%) MS Rank Un- sure Did not Minor…..……….………..……… Major 1 2 3 4 5 Construction Management issue 0.0 11.1 33.3 44.4 4.00 16 + Impact of optimum H&S on productivity 37.5 25.0 17 Marketing edge / advantage 18 H&S specification 22.2 3.89 19 + Impact of optimum H&S on quality 20 Impact of poor H&S on productivity 21 DoL enforcement of legislation & regulations 3.86 22 Resulting client satisfaction 3.78 23 Corporate social responsibility issue 55.6 24 Impact of poor H&S on cost 25 Impact of poor H&S on profitability 26 Impact of poor H&S on schedule 27 Other Regulations 12.5 3.71 28 Resulting worker satisfaction 3.67 29 Impact of poor H&S on quality 30 Table 2B: Extent to which ‘motivators’ contributed to respondents’ organisations addressing H&S (MS: 0.00 – 5.00). © 2014 : Prof JJ Smallwood

26 Minor…..……….………..……… MajorResearch – Findings (4) ‘Motivator’ Response (%) MS Rank Un- sure Did not Minor…..……….………..……… Major 1 2 3 4 5 Impact of poor H&S on environment 0.0 22.2 33.3 3.67 31 Resulting designer satisfaction 11.1 44.4 3.56 32 ‘I am my brother’s / sister’s keeper’ 55.6 33 Detailed inclusion of H&S in contract documents 3.44 34 Client ‘pressure’ 35 Client requirements 3.33 36 Cost of accidents 37 Economic benefits of H&S 38 Employer association guidance 3.14 39 Cost of compensation insurance 66.7 3.11 40 H&S Preliminaries in the BoQ 2.78 41 Worker ‘pressure’ 2.44 42 Compensation insurance provider ‘pressure’ 2.22 43 Union ‘pressure’ 2.00 44 Table 2C: Extent to which ‘motivators’ contributed to respondents’ organisations addressing H&S (MS: 0.00 – 5.00). © 2014 : Prof JJ Smallwood

27 Research summary (1) Extent to which ‘motivators’ contributed to respondents’ organisations addressing H&S: 6 / 44 (13.6%) motivators contributed to respondents’ organisations addressing H&S between a near major to major / major extent (MSs > 4.17 ≤ 5.00): OH&S Act Image Construction Regulations (H&S) Professionalism Reputation H&S is an organisation value 29 / 44 (65.9%) factors are of importance to near major / near major importance (MSs > 3.34 ≤ 4.17) © 2016 : Prof JJ Smallwood

28 Research summary (2) 6 / 44 (13.6%) factors are of near minor importance to importance / importance (MSs > 2.51 ≤ 3.34) 3 / 44 (6.8%) factors are of minor importance to near minor / near minor importance (MSs > 1.68 ≤ 2.51) © 2016 : Prof JJ Smallwood

29 Research – Findings (5) Anglo American plc (2014), the giant South African mining group The lost-time injury frequency rate (LTIFR) is a rate, per hours worked, of employee and contractor lost-time injuries due to all causes i.e. per 100 workers x hrs / yr Their rate reduced from 0.58 in 2012 to 0.49 in 2013 Average LTIFR for the South African construction industry is 0.98 [Construction Industry Development Board (cidb), 2009] Anglo American plc’s safety journey model used as depicted in Figure 1 (Slide 16) © 2014 : Prof JJ Smallwood

30 Research – Findings (5) Basic → Reactive Compliant Proactive Resilient Little interest in H&S – doing the minimum to get by. Exposed to significant H&S issues Aware that H&S is an issue, but usually responding to issues. Systems are forming, but immature H&S is a core part of doing business. Focus is on compliance with systems and processes Starting to get ahead of the game – anticipating and preventing H&S issues World class H&S performance – creating a process of continuous improvement / innovation Figure 1: Anglo American plc’s H&S Journey Model © 2014 : Prof JJ Smallwood

31 Research – Findings (6) Response (%) Mean Score SD D N A SA 0.0 11.2 44.4 4.33 Table 3: Extent to which respondents agree the model represents their organisation’s H&S development (MS: 1.00 – 5.00). Response (%) Mean Score Basic Reactive Compliant Proactive Resilient 0.0 12.5 25.0 37.5 3.88 Table 4: Respondents’ organisations’ current H&S status (MS: 1.00 – 5.00). © 2014 : Prof JJ Smallwood

32 Research – Findings (7) Statement Response (%) MS Strongly disagree Disagree Neutral Agree Strongly agree The positive impact of optimum H&S on overall performance promotes increased focus on H&S 0.0 11.1 66.7 22.2 4.11 Improving H&S performance is progressive 88.9 The journey to optimum H&S is progressive Fatalities promote increased focus on H&S 55.6 4.00 Incidents promote increased focus on H&S 3.89 Organisations initially address H&S due to legislation 3.78 Accidents promote increased focus on H&S Disabling injuries promote increased focus on H&S 3.67 Employer associations promote focus on H&S 77.8 3.56 The uninsured costs of accidents promote increased focus on H&S 44.4 3.44 The negative impact of poor H&S on overall performance promotes increased focus on H&S 33.3 The insured costs of accidents promote increased focus on H&S 3.33 The DoL Inspectorate promotes focus on H&S 3.22 Clients promote focus on H&S 3.00 Table 5: Degree of concurrence with statements on a range of strongly disagree to strongly agree (MS: 1.00 – 5.00). . © 2014 : Prof JJ Smallwood

33 Conclusions (1) Cost, schedule, quality, and productivity are ranked higher than H&S in terms of importance: Concluded that GCs are likely to view the traditional project parameters as more important than H&S for the foreseeable future Amplifies the need to motivate H&S on the basis of the positive impact optimum H&S has on overall performance Extent to which ‘motivators’ contributed to respondents’ organisations addressing H&S - conclusions: Ranking of the OH&S Act and Construction Regulations - legislation constitutes a primary motivator Ranking of image, and professionalism - there is understanding and appreciation of the holistic role of H&S Ranking of H&S is an organisation value, and H&S is a moral issue- although legislation is important, H&S is a moral issue (reinforced by the high ranking of preservation of organisational integrity) © 2014 : Prof JJ Smallwood

34 Conclusions (2) Positive impact optimum H&S has on performance relative to the other project parameters - GCs are aware of the synergistic effect of optimum H&S (reinforced by the ranking of marketing edge / advantage) Respondents’ agreement that their organisation’s H&S development had followed the presented model ‘Basic → Reactive → Compliant → Proactive → Resilient’ - H&S development and performance is stage based and evolutionary Unless the prior stages are completed, progression will not occur Premature motivation on the basis of the benefits that accrue at the next level is necessary to engender such progression Implications for those promoting H&S: Particularly when endeavouring to engender progression to the proactive and resilient stages To reach the resilient stage will require a holistic approach to promoting H&S, and increased focus on and commitment of resources to H&S © 2014 : Prof JJ Smallwood

35 Recommendations A multi-faceted approach should be adopted when promoting H&S - this applies to the DoL Inspectorate, employer associations, employee associations, construction managers, and H&S consultants: Obviously legislation should be cited and referred to However, the moral rationale for addressing H&S should feature prominently in tandem with the upholding of reputation and image, and consequent marketing benefits Then, the synergistic benefits of H&S should always be cited However, in order to realise self-reinforcement of the promotion of H&S on the aforementioned basis, on-going research relative to the benefits of H&S must be conducted © 2014 : Prof JJ Smallwood

36 Realities The industry is killing and injuring people (also making them ill) H&S non-compliance occurs = contravention Non-compliance is unethical Accidents are ‘failures of management’ Cost, quality, and time, take precedence over H&S CoA > CoP There is a return on investing in H&S Synergy between the catalyst H&S and the other parameters Improving H&S and achieving optimum H&S is a journey i.e. a progressive process Optimum H&S performance enhances a firm’s reputation, image, and likelihood of securing projects A holistic approach to promoting H&S is required © 2014 : Prof JJ Smallwood

37 References (1) Anglo American plc Anglo American plc Sustainable Development Report London: Anglo American plc. Construction Industry Development Board (cidb) Construction Health & Safety Status & Recommendations. Pretoria: cidb. Hinze, J.W Construction Safety, 2nd Edition. New Jersey: Prentice Hall Inc. Ikpe, E., Hammond, F., Proverbs, D. and Oloke, D Improving Construction Health and Safety: Application of Cost-Benefit Analysis (CBA) for Accident Prevention. The International Journal of Construction Management, 11(1), © 2014 : Prof JJ Smallwood

38 References (2) Smallwood, J.J Optimum cost: The role of health and safety (H&S). In: J.J.P. Verster (ed.) Proceedings International Cost Engineering Council 4th World Congress. Cape Town, April International Cost Engineering Council, 2004: CD-Rom Smallwood-J- Optimum Cost-Health & Safety.pdf Smallwood, J.J The Role of Optimum Health and Safety (H&S) in Construction Marketing. In: F. Khosrowshahi (ed.) Proceedings of 21st Annual Conference of ARCOM. SOAS, London, 7-9 September Reading: ARCOM, Smallwood, J.J The Practice of Construction Management. Acta Structilia. 13(2), pp Smallwood, J.J The Image of Contractors: A South African Case Study. In: C. Egbu (ed.) Proceedings of 26th Annual Conference of ARCOM. Leeds, 6-8 September 2010. © 2014 : Prof JJ Smallwood

39 References (3) Reading: ARCOM, 939-946.Smallwood, J.J Financial Provision for Health and Safety (H&S) in Construction. In: Proceedings of the CIB W099 Conference, Washington D.C., August, F:\data\papers\45.pdf. Wright, M. and Marsden, S Changing business behaviour - would bearing the true cost of poor health and safety performance make a difference? Norwich: Health and Safety Executive. Zwetsloot, G.I.J.M., van Scheppingen, A.R., Bos, E.H., Dijkman, A. and Starren, A The Core Values that Support Health, Safety, and Well-being at Work. Safety and Health at Work, 4 (2013), © 2014 : Prof JJ Smallwood

4TH PROJECT AND CONSTRUCTION MANAGEMENT PROFESSIONS CONFERENCE

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