The Next 10 Years of EHS - Canada & LATAM - Alex Lima - Feb 2016
1. Canada & Latin America Thought
Leadership Series
By Alex Lima, Executive Vice President of Sales, Canada, Latin
America & the Caribbean at ProcessMAP
The Next 10 years in Environmental, Health & Safety
Visibility, alignment, information centric and disciplined execution
2. 1
Introduction
The Environmental, Health and Safety (EHS) industry has evolved over the last decade, and will
continue to do so in a variety of ways. Gone are the days when EHS professionals were only
deeply technical, interacting with the operating areas in specific junctions and situations. For
those who came from industrial areas, like me, EHS professionals would conduct inspections,
suggest or mandate improvements and follow up the technical recommendations. The industry
was not there in terms of a holistic, structured, information management process. Trainings
were completed based on a deep technical knowledge of safety, environment and health, which
is definitely important, but EHS professionals were seen more like inspectors, or auditors, and
less as an integral part of manufacturing, production, operations and distribution, which was
not fair to their competence and technical stature in the organization. In general, the key focus
area was safety, far followed by environmental, and even further away occupational health
management.
The structured process of information management was not present at that time. Some more
advanced organizations had safety information in the computer mainframes, but the input
method was all manual and there was no integration with other systems. Data was captured in
a decentralized way, using simple tools and multiple confirmations. Questions, second guesses,
and, naturally a quite level of personal stress were all necessary to generate a simple
management report. Besides the purely transactional aspect of EHS, society – and by extension
organizations – have been growing more concerned about protecting people and the
environment. Fewer accidents, less occupational injuries, breathing cleaner air – just to
mention a few examples – simply make a lot of business sense.
This paper summarizes some key points based on the evolutionary trend in EHS and addresses
budding questions, including:
What will the future hold for the EHS arena, provided we continue to evolve and improve our
people, processes and technologies for EHS?
How EHS will interact with operating areas?
What skills will people need to succeed?
How will information build the necessary foundations for management?
The key points represented on the following pages are presented in no particular order.
3. 2
A Chief EHS Officer Role will be New Role
As it happened with information technology (IT), kind of about 10 years ago, Chief Information
Officers (CIO’s) and Directors of IT shifted from reporting to the Chief Financial Officer (CFO) or
the Director of Administration to reporting directly to the Chief Executive Officer (CEO). That shift
marked the recognition of the importance of information management – and of the technologies
that enable it – to support companies’ strategic directions. Information was finally recognized
as the DNA of the business; the foundation to transform materials into new products or to create
new services. A similar shift is emerging within the EHS arena. We will start to see EHS
professionals as part of the executive team, directly reporting to the CEO. The creation of a Chief
EHS Officer (CEHSO) will probably become commonplace, and EHS will become a key driver of
a company’s strategy, its business plan, and the execution of its business processes. Needless
to say, these senior professionals will require a highly efficient information system to quickly
evaluate the organization, its processes, shortcomings, historic data on performance and
provide the Board of Directors and the C-Suite with the necessary analysis and reports to drive
strategic value, reduce risks of future events and to compute actions to take.
Statistical Tools will be Extensively Applied to EHS
The statistical tools that have been commonly used in manufacturing, logistics, and other
operational disciplines, will be leveraged in the EHS field. These tools are not new, we all know
about Deming going to Japan from 1946 to 1956, the called early years, and these statistical
techniques eventually came to the US as somewhat the “new way” of manufacturing. It is
critical to consider statistical data so that the capacity to understand information and the ability
to make decisions continues to evolve. The fundamental problem of understanding variation,
understand and consider the Taguchi cost function, overall use of six sigma, which significantly
has positively impacted manufacturing and logistics, will become the language that EHS
professionals will use to communicate improvements. While the quantitative aspects of EHS
will facilitate better communication with statistically driven operations and will form the
foundation for continuous improvement, the qualitative aspects of EHS will pervade, becoming
even more complex as EHS moves up the value chain – closer to or within the executive team.
The combination of quantitative and qualitative information will validate the inextricable link
between the planet, people, and profits. In other words, companies will definitely realize that
protecting the environment, having a safer place, and reducing occupational health related
diseases simply make good business sense.
4. 3
A Continuous Improvement Framework will be the EHS Framework
One of the consequences of the more extensive and deeper use of the statistical process control
(SPC) techniques will be the establishment of a EHS continuous improvement framework. Let’s
make clear that there are many continuous improvement programs in place today, what I refer
to is the consolidation, communication, cultural shift in organizations to truly embrace the
continuous improvement mantra. The idea is simple: by measuring what happened and
understanding the statistical nature of what is happening (averages, standard deviations,
mode, correlations and related), organizations can establish metrics, link the activities and
tasks behind them, and follow up with disciplined execution. The establishment of a common
communication language, facilitated by SPC, will promote integration with EHS and other
departments. In fact, most of the changes that will drive EHS improvements are operations or
executive driven. Consequently, when establishing a continuous improvement process, the EHS
professional, will in fact establish integrated continuous improvement processes that will
necessarily depend on other groups.
EHS Functions will Shift from Reactive to Predictive
A natural consequence of a continuous improvement framework and the application of SPC
techniques within EHS is a slow transformation from the traditional reactive mode to predictive
mode. By understanding trends and variables, for example, what drives higher productivity; or
what truly causes accidents on a production floor, EHS professionals equipped with an analytics-
driven information management system will be empowered with actionable insights that impact
both safety and the bottom line. Access to quality data, therefore, will become absolutely critical.
The illustration below from Information Week demonstrates the pervasiveness of data quality
challenges. Since the quest of becoming predictive is contingent upon business intelligence –
which each individual has a different view and understanding of – we can standardize the
discussion by considering the raw material: data. So, being more predictive is having better
data. And “better” can only be considered in terms of how well the data captured represents
the facts. If we can collect data in a frequency that establishes patterns and trends, then we
can start to grasp the meaning of the data points in a given context, enabling predictability.
5. 4
EHS will be Tightly Aligned with Company Functional Areas and External
Organizations
We see a growing trend of alignment and better integration of EHS with manufacturing, logistics,
distribution, retail, that is, operations in general. This is clear moreover in the information
management aspect. We also observe growing integration with other key functions: human
resources to completely capture the human element, such as days away from work, hours
worked, hours lost, employee data; product development, working to produce products that are
environmentally friendly, or for example to create machinery that are safer to operate; financial
departments to assess the impact and consequences of accidents, environmental incidents,
etc.; legal departments for management of certifications, documents, permits, and
authorizations in a dynamic way to modify them as needed to quickly accommodate changing
legislation or new business requirements. EHS management systems will be exchanging data
with a variety of other systems; less and less they will not operate in any type silo anymore. In
fact, no business or technical system will operate in isolation anymore, due to the fact that
business and EHS processes will become cross-functional. They will span many departments,
6. 5
countries, functions, external providers, government and regulatory agencies, and groups. Ten
years from now, we will speak of the EHS value chain, rather than manufacturing value chain,
or logistics value chain only as we typically do today.
Risk Management Frameworks will Be Truly Data Centric
Today, most of the risk management strategies and execution that I have encountered are
qualitative driven. People correlate the risks with mitigation strategies based on their
experience or common sense. Very rarely, do I see quantifications in place. And when they are
in place, the data insight or how the probabilities came about are not that clear or they are gross
estimates. Naturally in some cases we see probabilities driven from the actual frequency of
occurrences, but in general EHS professionals are not yet that statistically enabled. Therefore
the concepts of expected values and probabilities are not typically applied. And if they are
applied, they are somewhat loose, not truly scientific in terms of capturing a phenomenon. This
will change in the next ten years for sure. The already discussed usage of SPC and the
integration with other groups will provide an extended value chain with metrics to understand
the capacity to form trends and patterns. Better quality of data will provide information that is
more reliable. Therefore, risks will be better quantified and mitigation activities will have a
strong quantitative component. The result will be employees at any level with more knowledge
about business processes and their risks and EHS professionals with also more knowledge
about the business processes and their risks. Both groups will be more data intuitive – there is
an interesting phenomenon that happens when we start to see over and over data patterns, we
start to “see them” and we start to have a quick sense of the situation much faster through
glancing the data. In general, this evolution will enable tangible contributions to the business
top and bottom lines through effective risk prediction and mitigation.
Required Training & Development for EHS Professionals will Increase
EHS professionals will require a new professional curriculum and training requirements.
Learning will have more focus on data management, neurolinguistics programming, functional
integration, risk management, continuous improvement programs, SPC techniques, information
systems, information management and mobile technologies. Quite an extensive list! More
online training will have to be complemented with many new classroom and team-based
trainings. Like maintenance, EHS engages with all the organization, at all locations. While the
trend is that companies will be doing more training, sessions will be shorter and more objective,
surgically addressing the employee’s personal needs in EHS but also in strong alignment of the
corporate safety, environmental and health goals and objectives. In addition to core functional
areas, EHS professionals will require more knowledge of sales (yes, they will need to sell more),
communication techniques (public speaking, coaching, mentoring) and executive engagement,
7. 6
as the organization will move up the ladder, closer to the executive suite. A complex combination
of executive level engagement and technical detail knowledge, definitely a challenging
proposition.
Mobility and Cloud will become Ubiquitous
All information will be accessible through mobile devices, from anywhere and at any time.
People will input data, run reports, discuss results, have better process visibility and faster
decisions through mobile platforms. These platforms will be greatly aided by a cloud
infrastructure. EHS applications will run primarily in the cloud as organizations will focus on the
functional needs, rather than the infrastructure requirements to run an information system.
With stronger alignment and deeper integration with other functions within the organization, the
usage of SPC, greater predictability, and better risk frameworks will introduce more
requirements and complexity into the management process. Somewhere it will have to give,
that is, simplified infrastructure and IT environments that allow people to focus on what is truly
important.
The Internet of Things (IoT) will Place EHS in Overdrive
The IoT has already begun to revolutionize many business and social areas, and will only
become more pervasive in the coming decade. Connecting all types of devices, monitoring
systems, and controls with medical devices, transportation systems, buildings, defense, and
sports – just to mention a few – will profoundly impact the way we live and work. For the EHS
professional, this will also have a significant impact. The ability to see far out in the value chain
with better visualization of personal wellbeing, such as knowing that an employee is about to
collapse in a dangerous manufacturing environment due to low blood pressure could save a
life. Integrating appliances and buildings into micro grids that are integrated into a larger, much
smarter electrical grid will bring benefits to the environment. Energy policies will change or
improve with better balancing of needs, demand and supply, rerouting energy to places where
it is more needed, and providing better pricing based on consumption. Another interesting
example is the Google car, capable of driving by itself. Could you imagine a society with cars
moving by themselves, drones flying by themselves, and and trains running according to a
schedule without an operator? What will these developments mean for the EHS professional
and the safety of our interaction with these automated devices? Perhaps they will be safer 99%
of the times, with a potential 1% catastrophic failure. Being all integrated, this 1% may mean
many lives lost. Like other aspects of life, EHS will also evolve to be more automated with
intelligent systems, sensors, and embedded intelligence.
8. 7
Conclusion
There are other elements that could be discussed in this paper. GRI reporting, CDP, and GHG
emissions will evolve accordingly. However, specifics on the environment is a topic that
deserves a paper of its own. Ten years from now EHS will have an even more vibrant landscape
for its professionals. They will be in the boardroom, in the Executive Suite, and side-by-side with
Engineering, Manufacturing, Logistics, Production Systems, Finance, third party providers,
vendors, government bodies, and trading associations. We will live in more automated, data
centric and information rich environment. This evolution will enabling smarter decision-making
through more visualization of business and EHS processes, allowing a more collaborative
engagement between the EHS professional and the corporate functions.