Why Companies Should Avoid Describing Their Culture as Safe

The concept of “safe” should be avoided as a descriptor of organisational culture, particularly in hazardous industries, according to an expert in risk management.

Both residual and entropic risks are found in four system factors (processes, technology, physical environment and human resources) that combine to carry out work, said Tania Van der Stap, founder and principal director of Align Strategic Management.

She explained that residual risk (the risk remaining after controls have been implemented) can’t be reduced in the short-term due to technological, resource and financial constraints – which leads to the requirement for organisations to reduce risk to as low as reasonably practicable (ALARP).

“The impossibility of zero risk translates in practice to a constant risk of injuries and losses, with some workplaces and tasks having inherently high levels of residual risk, such as underground mines and gas platforms. The concept of ‘safe’ is therefore a fallacy, can promote complacency and should be avoided as a descriptor of the culture, particularly in hazardous industries.”

Van der Stap, who was speaking ahead of a series of risk leadership workshops to be held across Hobart, Melbourne, Sydney, Brisbane and Perth next month (see below), also said this had important implications for incident and loss causation.

“Unwanted events involving uncontrolled release of energy relate directly to residual risk. Human resources also have residual risks stemming from incomplete competencies and/or physical limitations.”

HR residual risk provides the basis for employing and retaining experienced, risk competent personnel and for person-job fit assessment, explained Van der Stap, who add that said that over and above residual risk is ‘entropic risk’ which is caused when one or more of the four system factors degrades.

As system factors deteriorate, she said the probability of incidents and losses increases until such events become inevitable.

“When a business experiences a spate of seemingly unrelated incidents, systems degradation is often the root cause. It may be traced back to cost cutting, reduction in maintenance practices, loss of key personnel, greater work hours increasing levels of fatigue, and other decision-based factors which reduce standards of risk management in the organisation."

“This ‘entropic risk’ is a red flag at both organisational and individual worker levels, as it’s a shift away from planned, deliberate actions to manage risk effectively, to short-term thinking and compromises in quality decision-making. There are numerous catastrophic incidents that have told this story such as Deepwater Horizon.”

Van der Stap said that an “entropy model” can be applied to help manage risk, improve productivity, quality work outcomes and HSE incident mitigation.

“Incidents are the nemesis of productivity. We know that incidents are indicators of failed risk management – but we should also be asking the question, ‘What other losses are occurring?’"

“For instance, consider a workshop where there has been little or no investment to setting it up to safely and efficiently support the tasks being undertaken. This becomes self-evident with a walkthrough – poor housekeeping, unsafe storage of goods, minimal maintenance, failure to dispose of damaged equipment and lack of workflow planning."

“Concurrently, the workplace, because there isn’t a place for everything and everything in its place, perpetuates sub-standard behaviours. There is an interdependence between workplace/task design and the behavioural standards demonstrated by workers.”

The risk exposure to any business that has a workshop in this condition is high due to ‘entropic risk’ (degraded systems and behaviours).

“Sub-standard system factors are characterised by inefficiency, poor quality and a rising risk of HSE incidents. It is also difficult to embed the desired risk management culture.”

Van der Stap also observed that there are a number of ‘operational risk traps’ embedded within current safety management systems.

“The first, from a systems perspective, is reliance on the semi-quantitative risk matrix (for example, 5x5) which can put extremely low probability events into the high attention mix. An outcome can be ‘risk blindness’ where time and resources are expended on these rare events rather than fatal risks with known probability based on historic data.

Van der Stap said evidence of this can be found in recurrent incidents in industries that involve fatal risks, such as heavy lifts using cranes, mobile plant/light vehicle/pedestrian interactions and falls from heights. Another risk trap is lack of awareness of hidden hazards, which are inherent in the build and stem back to shortcuts taken at the design and construction phases of a site or product lifecycle.

“What are repeat mechanical failures telling the business about its risk profile? Are the current critical controls adequate?”

A further issue, from both a systems and cultural perspective which has been talked about at length in the safety profession in recent years, are safety programs based on Heinrich’s Triangle.

“The concept that there is a numerical relationship between ‘unsafe acts’, serious injuries and fatalities is fundamentally flawed. Serious injuries and fatalities are caused by unmanaged residual risk and the failure to prevent system factor degradation (entropic risk). Unsafe acts have also done a disservice to workers who do believe in sanctity of life, which directly relates to safety as a value.”

In addition, Van der Stap observed that the vast majority of workers aim to work conscientiously.

“Perpetuation of ‘unsafe act’ language is a hindrance to bottom-up strategies which rely on workforce participation and ownership. This also raises the question whether peer observation programs are really risk-based and add value if a business has paid attention through recruitment, selection and training to minimise its HR risks and maximise HR resourcefulness.”

There are a number of important implications in this for OHS professionals, according to Van der Stap, who said a multidisciplinary approach is required to manage risk effectively.

“An incident, while classified as ‘equipment damage’ may be a critical issue flagging risk that has production, quality and HSE incident implications. It’s a strategic risk trap when management fail to focus on the correlation between effective risk management and wider business performance (and not just safety).”

In the broader context and down to the granular level, Van der Stap said good planning and consultation with those who do the work and quality risk-based decisions need to be part of an integrated approach to risk management.
When incidents occur, Van der Stap also said businesses have the opportunity to learn – but more importantly, they should create an atmosphere of heightened vigilance about how the business is performing overall.

“Going back to the poorly planned and managed workshop, what else is going on?How are infrastructure, systems and processes hindering productivity, quality work and incident prevention? What cost effective, high return improvements can be made to produce gains in all these business objectives and concurrently, enable desired behaviours? How through participative processes, can operational risk be owned by the personnel who have to manage the risk on a day-to-day basis?”

Van der Stap said OHS professionals have a critical role to play in consulting with and building systems from both the top down and the bottom up.

“A shift away from safety to risk-based thinking will assist OHS professionals in consulting with management and help ‘right-size’ an organisation’s risk profile. The opportunity is to question the risk-basis of current HSE programs, reduce bureaucratic processes, and focus on risk mitigation to pursue productivity, quality work outcomes and HSE incident mitigation concurrently.”

Van der Stap is running a series of two-day risk leadership workshops on behalf of the Safety Institute of Australia:

Article first published by The Safety Institute of Australia

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