Absolute Safety Case Study

How does Safety become an investment?

A CONTRACTOR WHO USED SAFETY TO LAND BIGGER CONTRACTS AND DRIVE HIGHER PROFITS

Many construction companies in the south are trying to grow their business, gain bigger clients, and simply reap higher profits. This case study is about a General Contractor that has grown from a one-man welding shop to a family of over 100 professionals working with some of the largest industrial companies in the South. This is the story of their success and how their investment in safety became a driver for big contracts and higher profits.

Key tactics:

Disciplined Practice
Commitment to Improvement
Behavior Based Program (BBP)

Proactive Approach
Purpose Driven Policy
Coaching (vs Policing)

Key Stats:

Client was paying 3-5 times initial costs for things like expedited part orders. Better safety review resulted in more accurate job planning and scheduling, and eliminated a significant amount of these costs. — Client was paying **3-5 times initial costs** for things like expedited part orders. Better safety review resulted in more accurate job planning and scheduling, and eliminated a significant amount of these costs.

Client proved 30% more effective in delivery of results, becoming 20% less expensive (on average) than the nearest competitor, even after charging a higher initial price. — Client **proved** **30% more effective** in delivery of results, **becoming** **20% less expensive** (on average) than the nearest competitor, even after charging a higher initial price.

Client’s Technical Proposals typically outscored competition on evaluation by 10 percentage points. — Client’s Technical Proposals typically outscored competition on evaluation by **10 percentage points.**

Client helped their client produce an extra $50 million + of in-spec product because they delivered ahead of schedule. (Safety review resulted in the discovery of a major project flaw that prevented build until new design was managed, well within co… — Client helped *their* client produce an extra **$50 million +** **of in-spec product** because they delivered ahead of schedule. (Safety review resulted in the discovery of a major project flaw that prevented build until new design was managed, well within contingency budgets.)

Client was able to lower their EMR down to a .41, enabling them to become self insured, driving down insurance costs by over 50%. — Client was able to **lower their EMR down to a .41,** enabling them to become self insured, **driving down insurance costs by over 50%.**

Client’s average compliance rating in ISNetworld raised from a B to an A+. — Client’s average compliance rating in ISNetworld raised from a **B to an A+.**

Client received a $300,000 bonus for achieving BBP goals and safety objectives. — Client received a **$300,000 bonus** for achieving BBP goals and safety objectives.

Background:

Before they connected with Absolute Safety, the client was looking for their third Safety Consultant. Jobs were taking longer than predicted and projects were often chaotic. While this contractor prides itself on integrity, focus, and performance, pre-planning and safety efforts were struggling. Data was skewed, incidents were under-reported, and processes were simply inefficient. Without a comprehensive and proactive approach, time and effort were being wasted and part orders were, at times, being expedited for 3-5 times the initial cost, on top of project delays. The financial consequences were starting to pile up.

Company leadership performed some financial analysis and realized that the money they were saving on the lack of proper planning and safety came out to a mere fraction of the added expenses they often ran in to later. On top of that, they wanted to get jobs with larger companies with higher safety requirements, and they were not prepared to get those jobs. Even more importantly, they realized they were not keeping their employees as safe as they could be.

Problem:

Like so many small and mid-sized companies, the client had gaps in critical processes, procedures and systems. To pile on even more, they had a worker’s comp claim that raised their EMR over the working limit and threatened to stop all of their ongoing work. Absolute worked with the insurance company to keep the business running and navigated over 6 months of investigations to determine that the claim was fraudulent, and restored the client’s reputation. Absolute discovered that they were unable to catch this fraudulent claim ahead of time because they did not have sufficient processes for training, education, and reporting and monitoring. They weren’t catching all the facts, and it almost shut down their business.

Back on Track

With risks and inefficiencies piling up, Absolute needed to work effectively to halt any further issues. Absolute conducted an audit for the client, spanning the entire company’s processes and documentation. With thorough investigation and analysis, Absolute put together a plan to get everyone back on track. After the first 2 years with the client, Absolute was able to bring their compliance network ratings to an A+, giving them top scores in all categories and setting them up to get better projects with bigger clients. Where projects were usually considered large at $250K, the client began winning projects running in excess of $3.5MM annually, with multi-year opportunities.

Progressing:

Now that the client was caught up, they were ready to start getting ahead. Absolute was able to direct their efforts towards more proactive HS&E efforts. The companies they were working with started requiring more for their larger jobs, such as a sustainability program. Absolute worked with their client, their lawyers, and insurance company to develop the sustainability program they needed to get the work they wanted.

Entering the third year with Absolute Safety, the client now has outstanding compliance scores substantiated with variance reports from Absolute.

They are getting monthly reports on HS&E progress, including compliance, training, processes, and more. They had developed a proactive culture instilled alongside the processes, training, and changes Absolute brought. They had made such improvements that they began showing off their safety statistics in sales presentations to help win bids.

But then, the client discovered something that Absolute hadn’t even realized.

Results:

Absolute’s client was becoming more efficient than its competitors. When their clients conducted a Value Analysis, they realized that, even though their proposals were more expensive, Absolute’s client performed better than its nearest competitors. They started winning projects 10 times more valuable than they were used to. With 3rd party statistics proving superior performance in quality, HS&E and worker satisfaction, higher bids became much easier to get.

After their third year with Absolute, the client was invited to bid on their biggest project yet, a multi-million, multi-year contract to build an entirely new unit. The client had never done a project like this, requiring advanced safety programs such as Behavior-Based Safety. A goal of the Behavior-Based Program (BBP) was to catch people doing things right, and teaching them to use their safety manual, perform task analysis, and write good reports. The BBP was not focused on finding who to blame, and instead centered around collecting data, planning, and adjusting.

With Absolute writing the entire HS&E portion of their technical proposal, the client beat out 7 other companies (some much larger) to win the work. Even with the most expensive asking price, their proposal scored a 97/100 and was calculated to have a value 20% less expensive (more effective in results delivery) than the next nearest bid.

A huge part of the client’s delivered value comes from fewer mistakes, fewer redos, and fewer change orders. This is largely, in part, because of their improved proactive culture. Instead of waiting for their client to realize mistakes and make change orders, Absolute’s client started catching these and saving their clients hundreds of thousands (often millions) of dollars. They were delivering more work with higher quality, while remaining under budget, ahead of schedule.

The CEO didn’t think it was possible. He wasn’t used to his contractors finishing a job ahead of schedule, let alone under budget. In fact, he flew down to the finished site to see it with his own eyes. With on-spec product being produced over a week ahead of schedule, the project received the Chairman’s Award. Absolute’s client was named Small Business of the Year for their work on the project. The plant they built was able to produce over 50 million dollars more product than was scheduled that year. The client was so happy with Absolute’s work (and flushed with extra cash), that they paid for the entire next year in advance.

Conclusion:

This company is just one of the many businesses that have grown and earned more money from their improved safety practices. When smart people use data-driven processes to help change behavior, better decisions are made. When a passionate team executes a well-developed plan, you can objectively measure stronger results. While keeping your employees safe is the top priority, a proactive approach to safety can lead to improvements in your culture, greater efficiency, and higher profits.

Contact:

Feel free to reach out to Cody@absolutesafety.com to learn more about how Absolute Safety drive profits with safety practices.