THE PARACHUTE MANAGER

A problem which has appeared repeatedly in accident reports over the last 40 years, and particularly after the ‘lean, effective management’ revolution of the 1980s is that of managers who move into a position for a period of just 2 years and who have the objective of ‘turning round’ a plant to achieve efficiency and profit. This in itself is not a bad thing; profits through efficiency are good for nearly everybody and everything, including safety. What is wrong is not the goal but in many cases the way of achieving it.

The easiest way to achieve profit in a process plant is to cut staff, particularly those with a long employment history and large pension entitlement. This approach is much easier than trying to make the plant more technically efficient or to derive better throughput through improved performance or debottlenecking. Such improve-ments take much skill and generally take longer than 2 years.

A further way to reduce costs is to reduce maintenance, which not only saves the cost of maintenance but also reduces plant downtime and allows more continuous production.

Of course, reducing staffing and reducing maintenance is not without risk. In the end, someone must pay. However, by the time this happens, the parachute manager has moved on, possibly moved up, as a result of his or her ‘success’ in increasing profit.

In some cases, the manager may believe he or she is doing a good job. In others, the behaviour can be so extreme that it can only be described as sociopathic. The manager knows that there will be a price to pay, but simply does not care. Examples observed of this (from personal experience) are managers illegally disposing of toxic waste, operating plants with major sections of safety systems inoperative, postpon-ing critical repairs, falsifypostpon-ing inspection records and dismisspostpon-ing injured persons in order to maintain a good safety record.

CASE HISTORY 13.7 Hubris [8]

An example of where a manager appears to really have believed that reductions were properly made was for an oil-production platform in South America. A company executive is quoted:

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The company has established new global benchmarks for the generation of exceptional shareholder wealth through an aggressive and innovative cost cutting programme on its production facility. Conventional constraints have been successfully challenged and replaced with new paradigms appropriate to the globalised corporate market place.

Through an integrated network of facilitated workshops the project successfully rejected the established constricting negative influences of prescriptive engineering, onerous quality requirements and outdated concepts of inspection and client control.

Elimination of these unnecessary straightjackets has empowered the project’s suppli-ers and contractors to propose highly economical solutions with the win-win bonus of enhanced profitability margins for themselves. The project shows the shape of things to come in the unregulated global market of the 21st century.

Hopefully, the last sentence is untrue, because the platform had two serious explosions about a year later, with the loss of 11 lives, and sank 5 days later, with a capital loss of US$0.5 billion and considerable delays in oil field development.

The accident commission for the incident [9] described the causes of the sinking as follows:

• A design error which allowed hydrocarbons to enter the emergency drain tank directly from the production header rather than from the production caisson

• Delay in starting the emergency drain tank pump for 1 hour

• The failure of actuators to close ventilation dampers, allowing water to flood flotation compartments

• Two seawater pumps being under repair, without emergency measures in place in case of emergency

• Inadequate contingency plans and inadequate training for dealing with emergency ballast and stability control situations

From reviewing accident reports, aggressive cost cutting appears to have cost shareholders worldwide over $40 billion in asset losses and business interruption over a period of about 20 years, just taking the largest 100 accidents into account.

LEADERSHIP

In reviewing the analyses and audits of 130 plants, belonging to over 90 companies which formed a background to this study, the one thing that sticks out foremost con-cerning the safety practices is that plant safety is determined by senior management knowledge of good safety practices and their leadership in applying the principles.

The plant will be a high-integrity plant if

• Managers visit the operating plant frequently and are visible;

• Managers wear proper personal protective equipment at all times when in the plant and obey safe working rules;

• Managers establish clear safety rules, then provide the workforce to support the rules;

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• Managers discipline employees who break rules;

• Managers do not allow unauthorised improvisations and new ways of work-ing without a job safety assessment;

• Managers provide proper safety training;

• Managers ensure that needed documentation, drawings and procedures are up to date and readable and

• Managers follow up and ensure mitigation or prevention or repetition of all incidents and near misses and of all hazards found in studies and workshops.

CASE HISTORY 13.8 A Success Story

A chemical waste plant had a major hazard accident once per year over a period of 7 years. There were many demands from the local community for the plant to be closed. As a result, the management were forced by the authorities to carry out a thorough risk assessment, which included a full safety audit.

Following this, a period of 30 years has followed with no further major acci-dents, although there have been two near misses.

The risk analysis itself made some difference in that several weak points in the design were eliminated. All modifications on the plant have since been sub-ject to risk analysis. However, these changes alone can explain only a small frac-tion of the improvement. At a follow-up after 25 years, the practices established after the risk analysis were either still in place or had been improved on. The management had changed, but only by natural progression; the original plant manager still worked for the company as a consultant.

The changes can be traced directly to a change in knowledge and practices of the management. There was never any doubt about their good intentions or their determination to run a safe plant. The analysis provided them with the tools needed to understand their risks and to do something about them. In comparison with this, the recommendations made on the basis of the risk analysis provided a small contribution.

In more recent years I have had the opportunity to work for a group of companies with a very high level of integrity imposed (literally) from the top. In spite of an international workforce, it has been possible to see over a period of some 12 years a continuing improvement in safety knowledge and in safety practices. True leader-ship works. This does not mean that performance is perfect, and there are continuing problems with management of contractors, since each new project seems to generate its own problems. Importantly though, the management system has sufficient checks and balances to ensure that the majority of problems are caught. In the one area where performance was inadequate, with several accidents, the companies in the group all made major (and expensive) efforts to eliminate as far as possible all risks associated with the problem.

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