Choosing Great Contractors for your need

There is a continuing global pressure on companies to reduce costs, improve margins, deliver ever increasing profits and stay focused on the critical success factors. These relentless performance demands have an increasing number of companies contracting out work that is not a part of their value added core competencies. Whether these contractors focus on big capital projects, relatively small add-on items or daily tasks, all come with a safety culture that differs from the hiring entity. Once the contractor goes live in the field its safety culture reality can have a significant impact on the hiring organization’s performance, personnel and reputation.

How then does one choose the best contractor for the jobs in question? A number of our customers have faced this issue. Together, we have found the best selection approach is similar to a dating process (that most of us have gone through one or more times).

The initial look is to determine if there is any real interest, or is the potential contractor too ugly? In the contractor dating model this first look is a review of downstream indicators (injury statistics) and any government or legal action history. Only the top 25% of potential matches are allowed to move on to the next stage.

The next step in this dating approach is for your company safety pros to do a thorough inspection of the contractor’s safety data, policies and procedures. We send our people to work with their people on such things as:
• Leading indicators: Scheduled inspections, Management involvement, etc.
• Worker’s Comp information: Last three years trends
• Insurance coverage
• Substance Abuse policies and testing
• Incident statistics: An analysis of the last three years data and trends
• Orientation and training: Employee responsibilities, duty to refuse work, emergency plans, etc.
• Policies and Procedures: What is in place for their work
• Subcontractor management: Pre-qualification process, level of supervision provided in things like inspections and orientation
• Forms: Near miss, incident investigation, tailboards, etc.
• Stop Work Orders, Incidents, Charges, Convictions: Site work experiences, environmental, traffic safety, etc.
• References

A few of your candidates will survive this in-depth review. For those, it is time to “meet the parents.” In this step we move beyond the contractor’s safety pros and work with upper management and supervisors. The contractor’s safety pros give well-rehearsed answers to our questions. We want to know what the managers and supervision really believe and practice. No yes-no questions, only open-ended inquires that test knowledge and practices of critical leaders with respect to safety. Our interview team meets one-on-one with contractor leadership to get details such as:

• Management Commitment, Responsibility and Accountability:
How does management document and communicate values and expectations regarding HSE
Describe levels of safety accountabilities
Describe your system for measuring safety culture changes
Explain your safety and environment KPIs
• Total Safety:
Describe your: • proactive reporting system
• site inspection system
• Management of Change
How are people, equipment and procedure changes managed?
Describe your process to ensure compliance with applicable safety and health regulations
• Risk Assessment and Management
Describe your system for identifying, evaluating and controlling hazards/risks
• Incident Management and Investigation
Explain how incidents are reported, investigated and connected to root causes
How are corrective actions identified, implemented, closure verified and lessons learned communicated?
• Work Management
How are emergency procedures maintained?
Describe your maintenance and verification program for safety of equipment and tools
• Personnel Selection, Placement and Competency
How do you ensure positions are filled by capable, competent people?
Explain your training and competency verification systems?
Describe your supervisor development process
• Subcontractor Management
How do you ensure that subcontractors are selected based on their ability to perform in a safe and secure manner?
• Safety data
The last four years of company and subcontractor injury/incident data with discussions
• Environmental Policy
Describe your processes to reduce or eliminate environmental incidents
Describe initiatives you have taken to reduce environmental risks
• Substance Abuse
Describe and provide a copy of your substance abuse process realities
Provide information on your certified alcohol and drug testing laboratory
• Flexibility
How will you fit into our system?
Discuss systems and get commitments
How will we both ensure fidelity?
Reporting systems
Onsite observation and monitoring
High risk job considerations
Correcting inappropriate issues

This is an in-depth process to make sure you get the absolute best, safety-qualified contractors. Onsite interviews complement this dating process, which leads to a long term, solid commitment. To get an even deeper understanding of the safety cultures, some organizations also have their final contractor candidates take a safety perception survey.

Leading-edge organizations provide training for the weak contractors who ‘get it’ to build them up, and also for the ones who are strong, to ensure the contractors continually communicate excellent safety standards. The training for these contractors almost always includes their own company safety training program. One of the hiring company execs, not a safety pro, introduces the training. It starts with a slide that reads something like “When you step onto our site, you are stepping into the safest environment in our industry. Here’s why we are different. Here’s what we expect of you. Here’s what we believe. We only want to work with the best. If you agree to support this culture, then stay with us. If not, it is time to leave.”

Next is a review of interview details to discover the gaps, leading to a program for the contractors to close those gaps. The field work concentrates on mission critical contractor supervision. Front-line supervisors are screened carefully. Safety culture training at the workface is beyond the regs. Maintaining training excellence in safety culture is crucial because of turnover. Supervisors must support, mentor and help employees live the safety culture. As a part of this approach, they typically have two safety culture training programs that address:
• Young employees with limited experience at the company and who require mentoring
• Longer-service employees who require deprogramming of past shortcut mentalities and bad safety attitudes

The organizations that do this kind of in-depth contractor evaluation all have some kind of flow chart to guide their efforts.

This is a lot of work. Is there a Return On Investment? Interestingly, a cost-benefits analysis of this approach revealed the initial cost for the best safety contractors, plus all this interviewing and training was higher than just hiring contractors for about the first three months. Time and motion studies showed that the lack of job shut-downs for injuries made this group the most productive and cheapest contractors in industry. In the long term, carefully selected contractors are amazingly superior to those chosen based on cost or supposed productivity. The front-end investment for careful selection delivers an ROI far beyond the cost to go through the ‘dating-engagement-marriage’ process.
About the Author: Mike Williamsen Ph . D. is a Senior Safety Consultant for Caterpillar Safety Services. You may contact him at Content Partner Info:

Originally Published in Industrial Hygiene News

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