The Cost-Benefit Argument for Investing in Tech to Improve Safety

Most professionals in the construction industry will agree that projects are already complex, and the growing lack of skilled workers only makes them more complicated. For the sixth consecutive year, trade positions are the hardest to fill globally. Ensuring workers are properly trained on safety procedures and keeping them focused and engaged is critical for retention, business productivity and safety. Jobsite workers are faced with hectic schedules and hazardous working conditions, which can result in injury, illness, lower productivity and morale, and increased absences, all of which could ultimately lead to lower profits.

According to the Occupational Safety and Health Administration (OSHA), 20.7% of the worker fatalities in private industry in 2017 were in construction. Protecting workers and teaching workers to protect themselves and each other should be the primary goal of any safety program.

Establishing a financial return on investment (ROI) helps identify the value of your safety program and can help you measure and drive wider adoption of safety practices. Ultimately, you want your company to reap the benefits of your safety investments.

One key to developing and measuring the ROI of any program is to identify areas of potential impact, estimate the improvements and identify real scenarios where benefits could be realized. It’s often smart to identify a potential range for the measurements, especially if there are many factors that could influence the calculation. Knowing your direct and indirect costs related to injuries is an important input for your safety ROI.

It’s also important to recognize that there are qualitative and quantitative measures, and often, you may not precisely know the ROI up front, such as positive impact on productivity and retention. However, you can estimate the return. One final piece is an implementation plan that includes not only the plan to measure and deliver on your ROI goals, but also a continuous improvement plan that may support exceeding your ROI goals.

Where to Look for ROI

The following are a few areas within your safety program to utilize data within to see evidence of ROI potential.

Decreased lost time—Search for positive results in metrics, including days away from work, restricted work, job transfer rates, and days for transfer or restriction. However, you must be cognizant that other people in other departments, including your executive team, may not understand just how important these metrics are to the bottom line. Be prepared to provide examples that demonstrate what these metrics mean to the business.

Lower insurance costs—You can easily demonstrate the ROI of a safety culture through a decrease in insurance costs, especially those related to workers’ compensation. According to the National Safety Council, for every dollar in direct costs, indirect costs could be as much as $2.12 from workplace injuries, such as workplace disruption, loss of productivity, and more. Help key stakeholders at your company understand the root causes of workers’ compensation claims to really drive home how positive safety culture is affecting the jobsite worker.

Greater productivity and profitability—Improved employee morale and safety culture adoption tend to be more subjective than data-driven metrics. In other words, higher morale means higher productivity, but more importantly, engaged workers can translate into profitability. According to Forbes and Gallup, highly engaged teams show 21% greater profitability. Evidence of a good safety culture adoption includes high rates of participation in safety training, employee willingness to share safety suggestions or point out hazards without fear of retaliation, and communication between employees and supervisors on safety matters.

Going Digital Improves ROI

Today, construction businesses that are still using paper processes to capture information are not only dealing with increased costs and inefficiencies, but they also don’t have access to timely and important data that could positively impact the business. Additionally, they cannot take advantage of the many evolving benefits of technology.

Paper processes also limit the use of proactive safety measures and cause your team to react to old information instead of leveraging information in the moment when it could make a difference. For safety, that means you are more likely to react to incidents, rather than using technology to help proactively prevent incidents.

Digital software solutions provide a better way than paper, and when implemented, companies may see up to 34% greater employee efficiency and two-times faster decision-making, according to VMware software company. When it comes to choosing the appropriate safety software for your company, it can be challenging when deciding on the features your business will actually need. One outcome to consider is how a digital software could engage your workforce.

According to OSHA, the most effective safety programs actively engage workers. With active participation, workers share the responsibility of safety, and since the jobsite worker knows the most about potential hazards associated with their jobs, leveraging this knowledge can help companies not only save costs, but also gain productivity and worker engagement.

By coupling digital solutions with engagement and mobile technology, companies may find significant ROI. According to the Pew Research Center, more than 81% of adults in the United States own a smartphone. That increases to 96% for younger adults, and that adoption number will no doubt increase with time. Leveraging technology that workers use daily in their personal lives makes adopting technology on the job much easier and less stressful for everyone. By allowing employees to have the opportunity to easily identify risks and concerns through mobile-based frontline worker safety software, workers can be more proactive with safety, identifying potential red flags before they become incidents. Once workers are given a voice—enabled by the technology—they can quickly share ideas on safety-related improvements that can make a real difference.

The Case for Safety Software

Employers who invest in workplace safety and health can expect to reduce fatalities, injuries and illnesses. Companies that also invest in safety software that engages the whole workforce can expect to leverage additional ROI from productivity, efficiency and worker engagement. This will result in cost savings in a variety of areas, such as lowering workers’ compensation costs and medical expenses, avoiding OSHA penalties, and reducing costs to train replacement employees and conduct accident investigations. The key is to look at the money put into a safety program as an investment in the business, rather than an expense.

As the construction industry continues to evolve, embracing safety software and other programs will help companies stay competitive and effective. Strengthening jobsite safety not only reduces the dangers and risks for workers, but also increases the productivity and quality of the work you deliver. By finding a safety software that is customizable for your company and meets the needs of your employees, you will also win through a positive company culture with more respected, valuable employees.