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Author: Catherine Gutierrez
For every $1 spent on workplace safety, companies save at least $3.

That’s a 300% return on investment (ROI).

Not bad if you’re interested in improving your capital, and let’s face it, we allwant to improve our profits.So, how did we arrive at these numbers, and – more importantly, how can you use them to estimate the true costs of incidents inside your organization?

To do that, we have to dig a little deeper into what an incident actually costs. What we find is that accidents comprise more than the obvious expenses of medical care, they are also controlled by indirect costs.

Therefore, when we look at incident charges, we must calculate the indirect expenses of worker displacement and the damage it does to the organization.
The result is shocking. For every $1 we spend on an accident’s direct costs, another $3 to $5 is wasted on indirect costs. An accident’s actual total then,is between $45,000 and $75,000, with direct medical expenses comprising $15,000 of the overall price tag.

The Role of Prevention

When all costs are considered, it becomes clear that we should be prescriptive – rather than reactive, in our efforts. Contractor safety management services were designed to be prescriptive by retraining our approach to be more proactive and focused onaccident prevention.

The change to prevention comes when our goalsgrow into training and preparing ahead of time. contractor safety management services do that by removing the uncertainty that often surrounds the contractor – and what experiences they have in safety management.

This is done in four distinct steps:

1. Prequalifying Contractors
2. Verifying Insurance
3. Auditing Policies and Procedures
4. Employee-Level Management

1. Prequalifying Contractors

By centralizing your data, contractor safety management services eliminate the administrative portion of prequalification. This means no more digging through supply chain details, found in countless stacks of paper and spreadsheets.
An online database is used to store and centralize all the information surrounding your suppliers – with an easy-to-use interface. With prequalification details located online, departments can increase collaboration to ensure that only the best contractors end up on site; effectively preventing many of the issues we see with workplace safety.

2. Verifying Insurance

Often seen as an ad hoc measure, verifying insurance should actually be at the forefront of what we do. Why? It protects us where preventative efforts can no longer help – once an accident has actually occurred.

To simplify the process of collecting and QA’ing insurance, contractor management services step in to put everything in one location. Suppliers submit their documents to the online database and insurance experts review each certificate for the correct additional insured parties, and proper levels of policy limits.

Permission-based roles allow you to assign individuals inside your organization to be notified of any changes and to manage the process using your own legal requirements.

3. Auditing Policies and Procedures

Risk management must also be included in our equation.

In talking about risk, we are referring to the fact that some contractors, because of the services they supply, are more susceptible to incidents. With that being the case, prequalification, alone, is not enough to tell how this supplier will perform once on-site.

After all, gathering incident ratings – while very important, only tells us half the story. We must use leading indicators, gathered from policy and procedure audits to really tell us what’s happening and perform a one-on-one review on our supply chain.

An audit done in tandem with contractor safety management services delivers more qualified suppliers – with the proof to showthe company’s competence and capability.

4. Employee-Level Management

This leaves us with only contractor employees as a remaining concern.
Prequalfication, insurance verification and auditing are all done at the company level. While they are essential to ensuring that safety and sustainability practices are in place, they won’t tell you about Joe, the electrical contractor who is currently at your site.

Does Joe have the right training, levels of certification – and has he seen your safety orientation video? These are all questions that employee-level management can help you to answer.

Contractor safety management services add to that by gathering and verifying critical employee data, so that it can be delivered to you in an easy-to-use, online format. The flexible software obtains data on employee training, competencies, certification and craft skills. It also facilitates the distribution and tracking of orientation videos.

Instead of wondering whether Joe was reviewed before he was appointed to be at your location – you can simply look him up, and see that data for yourself.

Tying It All Together

We can see how prevention can certainly help to set us up for success – but how do we take this information and use it to get that 300% ROI we talked about earlier?

The first step is to put a program in place.

It may seem obvious, but just taking some of these measures back to your team and asking about the opportunity to implement them, can significantly affect your efforts. Once you have the approval of those around you, start to customize your program to your company’s needs – make sure that you’re covering all the bases of where an incident could occur.

Next, set a schedule to test and evaluate your plan. Timed intervals should be used to test your safety programs every month, quarter, year, etc. This should be unique to your organization’s needs and increased, or decreased, based on your circumstances.

Finally, realizing this can be a big undertaking, consider the help of a company that specializes in contractor safety management. It will reduce your required effort, while considerably increasing your ability to act on the issues that you come across. A firm can help you further protect your supply chain – while simultaneously make it easier to manage.

Whatever option you choose, make the decision to make a difference.
Our workers, whether inside our walls, or without them, have the right to come to work every day and be safe. At the end of the day, everyone should go home to their families.

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