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Developing a Compelling Business Case for Health and Safety

cost risk benefit diceOne of the most common misperceptions about health and safety is that it is an expensive burden.  People recognise that it is important and understand its significance if it goes wrong, but often see it as a necessary evil. 
However, time and again, it is has been proved that good health and safety makes good business sense:

  • maintaining a good reputation
  • retaining staff
  • boosting productivity
  • avoiding the costs of accidents and ill health.

Here are our top 5 tips to help you to develop a compelling business case for your health and safety programme and get decision makers to realise it is a vital part of a successful business.

1 Do your research

Scope out the project and see for yourself whether it is worth doing and how you should position the business case.  The only way to do this is through research, research, research.  You need to:

  • get the facts, figures, costs and details
  • look at what the competition is doing
  • identify what your clients and shareholders want
  • know who you are presenting to and what their priorities are.

Make friends with your HR department to get historical sickness absence figures.  Your Finance Director should become your new best friend, talk to them to get costs of production downtime associated with lost time accidents.  Go and see your operations manager to get details of the impact of lost time incidents on productivity.

Benchmark yourself against other organisations.  The Health and Safety Executive, IOSH and sector specific trade associations all have lots of useful information on accident and ill health statistics. For example, case studies provided by the Institution of Occupational Safety and Health (IOSH) show how some companies have made huge savings.

Speak to your peers in your sector, many will be happy to share information and experiences.  Look at your competitor’s annual reports to see how they are positioning themselves.  Once you have got your data you can then decide whether there will be an appetite at top level for your project.

When you present your research, you will probably need to make some assumptions about the benefits of your project to the business.  You will have factual, real data, e.g. number of employees, sickness absence costs, but you may need to make educated allowances for potential variation or uncertainty.  If you can give the "best-case" and "worst-case" scenarios then you can show that you really know what you are talking about.

Make sure that you know who you are speaking to when you are presenting the business case.  Are they a decision maker or an influencer?  You may need to tailor what you say in a slightly different way for an influencer to a decision maker.

2 Link to operational benefits

Ask the question:

How will my health and safety project affect the bottom line?

When you are making the case:

  • Make sure you clearly link and explain how each feature of your project contributes to the business and the benefits of implementing it.
  • Be prepared to answer difficult questions and really know your facts and figures.
  • Be prepared to negotiate so know how far you can go without causing risks to people or the organisation.
  • Work out what is an absolute, what is a nice to have and what you can really lose if you need to.

3 Assess the economic risks

  • Think about the risks and benefits before you present your case.  What’s the risk of doing it and the risk of not doing it?  Who else will it affect?  Don’t be vague, really pin it down.  Give actual costs, actual legal issues and real examples of case law.
  • Carry out a cost benefit analysis.  Work out what the benefits of the project are and how much it will cost.  Then work out what the savings will be.
  • Think about what can happen if the organisation does invest and when they will get a return for their investment.  Also explain the risks to the organisation if they don’t invest.  Could they lose customers, could they lose some of their market share or will there be legal costs?

4 Set the standards you want to achieve

What gets measured gets done.

Set clear Key Performance Indicators (KPI) as part of your business case.  A KPI will clearly show whether something that you have implemented has been successful or not.  If you identify which factor measures the success of a particular benefit then you can help decision makers determine the validity of the benefit, measure progress and know what success looks like.  If they are not clearly defined the KPI can become lost and so will your business case!

Be reasonable about what you are trying to achieve; if you have high accident stats, don’t expect them to be zero in three months.  If your organisation is making cuts don’t ask for a £1m investment, it just isn’t going to happen.  Remember that you may need to start small to show results.

5 Align with strategic goals

Link the message to what your organisation is doing at the moment.  Look in your annual report or on your intranet and find out what your organisation’s strategic goals are.  Then make sure that you align your health and safety project to one or all of the strategic goals.  If your decision maker is on the board or a member of the senior management team, then they will have created the strategic goals so will be looking for ways to achieve them.

For example, if your organisation wants to “increase net profit by 10% annually” then show them how you can save 10% off the bottom line.  Or if the organisation wants to “develop the leadership abilities and potential of our team” then show them how delivering an IOSH Managing Safely course can help achieve this.

A project with a high return on investment is great, but it is not a complete business case justification if the proposed solution does not align with the company's strategic goals.

In Summary

Increase your chance of getting approval for your health and safety programme by:

  • providing a well thought out business case
  • demonstrating the returns that you can get from implementing it
  • showing how this links to the overall strategic direction of the organisation.

System Concepts are working in conjunction with IOSH to deliver a new business skills training course for employees who are given responsibility for health and safety.  The course is entitled Meaning Business and is reviewed in detail in this video:

If you want to find out more information or would like to book the course, visit www.iosh.co.uk/lifesavings.  To talk about how we could help your business please contact us.

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