Safety and environmental management in the oil and gas industry: A new model to enable line performance

September 26, 2013

Executive summary

From a safety and environmental (S&E) perspective, large process industry companies have made huge strides in the last decade. Thanks to more rigorous guidelines, an increasing emphasis on personal and process safety programs, and better risk management practices, S&E performance is far better now than it used to be. Yet the ultimate goal — “zero harm” levels of performance — has remained out of reach in most sectors, as S&E performance has plateaued in recent years.

Part of the problem is the focus on functional activities, and the benign neglect of the interface between S&E and the front line. The usual approach is to assign S&E advisors to frontline work sites, and give those advisors a broad and poorly defined mandate to “support day-today S&E activities.” This has led to a sharp drop in injuries and fatalities in the last 10 years. But the ambiguity in this approach also leads to duplication and a “do it for me” attitude, and opens the door to a sometimes confusing stream of new initiatives and procedures.

We believe companies can take the next big step forward in their S&E performance if they consider a paradigm change, moving to an entirely new model. In this model, accountability for day-to-day S&E performance shifts to the front line, redefining the role of the central S&E function and eliminating the overlap that may once have been justified but has become an obstacle to future progress. For this to happen, frontline workers need to understand their new responsibility and develop the capabilities to fulfill it. Where a capability is missing, the role of S&E advisors is to help build that capability, not substitute for it. A structured approach, beginning with a self-assessment and a clear statement of the ideal end-state organization, can help companies make the move to this powerful new model.

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Benefits of a changed model

In getting the S&E operating model right, the oil and gas company has started to put itself in a position where it not only can achieve a level of safety performance on par with its industry but can also begin to approach the ideal of zero injuries. It has put the onus for S&E performance where it belongs — on the managers who already have credibility and the trust of their staffs because of their operational experience. At the same time, the company is allowing the S&E function to develop its regulatory and subject-matter expertise, so that it can pursue the valuable mission of continuous performance improvement, and pull back on its role as a stand-in safety officer.

Conclusion

During the past two decades, industrial, chemicals, and oil and gas companies have made huge strides in their S&E practices and outcomes, but the pace of improvement has stalled in recent years. Environmental mishaps, serious injuries, and fatalities have become rarer, but there is wide consensus that even one is too many — and can undermine a company’s fortunes for months or even years.

At best, many companies today are on track to make incremental improvements by tweaking the S&E models they already have in place. We suggest they consider a paradigm change, moving to an entirely new model that shifts accountability for day-to-day S&E performance to the front line, redefines the role of the central S&E function, and eliminates an overlap between S&E and operations that may once have been justified but has become an obstacle to future progress. We are encouraged by the potential of this paradigm shift and believe that the new path will unlock significant further improvement steps again in the future.

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Safety and environmental management in the oil and gas industry: A new model to enable line performance

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