Organisation and risk amplification

Prof Stewart Lockie

We know them when we see them

• 2011 was the most expensive year for

disaster losses in history at approx US$380 billion.

• This was due

to a spate of disasters affecting developed countries:

Japanese earthquake and tsunami, New Zealand earthquake,

Australian floods and a series of disasters in the US.

• However,

in terms of both the number of disasters and the number o

f people affected by them, 2011 was a below-

average year in comparison with the previous decade.

• Japan’s post-tsunami nuclear accident poses serious questions

about preparedness for technological accidents caused by

natural hazards.

• Investment in disaster preparedness is cheaper than post-

disaster reconstruction.

• Disaster plans and definitions need to adjust to a new and

shifting ‘normal’ due to climate change.

• Humanitarian funding is disproportionately directed towards

disasters with higher media coverage rather than towards those

with disaster-affected populations in need of assistance.

• Global population is aging and older people make up

disproportionate share of casualties.

• www.brookings.edu/~/media/Files/rc/reports/2012/03_natural_disaster_review

_ferris/03_natural_disaster_review_ferris.pdf

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“Everyone has violated regulations, failed to plan ahead, and bungled in crises. But people are not, as individuals, repositories of radioactive materials, toxic substances, and explosives … The consequences of an individual’s failures can only be catastrophic if they are magnified by organizations”

Perrow (2011: 51).

Reason, J. BMJ 2000;320:768-770

Reason’s Swiss Cheese model of accident causation…

Most common causes of major industrial

accidents and system failures:

• Regulatory failure and capture

• Ignored warnings

• Production pressures

• Cost cutting

• Poor training

(Perrow, 2011: 51).

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BP Texas City Refinery explosion, 2005

• Fire and explosion 23 March 2005

• 15 deaths and 170 injured

• US Chemical Safety & Hazard

Investigation Board inquiry:

– http://www.youtube.com/watch?v=V

CcN4SQkb9A

– http://www.csb.gov/videoroom/detail.

aspx?VID=16

• Baker Panel ReportCommissioned following recommendation from

CSB that BP independent panel to assess and

report on corporate oversight of safety

management and corporate safety culture

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CAB Investigation:

• Focus on both technical and organisational causes.

• Quote Columbia Accident Investigation Board on role of NASA’s organisational

structure and culture:

“Many accident investigations make the same mistake in defining causes. They identify

the widget that broke or malfunctioned, then locate the person most closely connected

with the technical failure: the engineer who miscalculated an analysis, the operator who

missed signals or pulled the wrong switches, the supervisor who failed to listen, or the

manager who made bad decisions.

When causal chains are limited to technical flaws and individual failures, the ensuing

responses aimed at preventing a similar event in the future are equally limited: they aim

to fix the technical problem and replace or retrain the individual responsible. Such

corrections lead to a misguided and potentially disastrous belief that the underlying

problem has been solved”.

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Key technical findings:

• Major equipment had not been replaced despite a series of incidents demonstrating it

was unsafe.

• During the incident, instruments failed, gave incorrect information or gave insufficient

information to operators.

• Operators were inadequately supervised and trained, understaffed and fatigued.

• No requirements were in place for shift turnover communications.

• Occupied trailers were located too close to a process unit handling highly hazardous

materials (all fatalities occurred in and around the trailers).

• Policy of ensuring all nonessential personnel were removed from areas in around

process units during start-ups (a particularly hazardous time in operations) was not

followed.

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Organisational findings:• BP used inadequate methods to measure safety conditions. Reliance on low personal injury rate

confused personal safety with process safety.

• Despite 23 deaths in the 30 years leading up to the disaster, and numerous hazardous material

releases, BP did not take effective steps to stem the growing risk of a catastrophic event.

• Releases of hazardous material were not investigated.

• Inspections by US Occupational Safety and Health Administration did not identify likelihood of

catastrophic incident.

• Cost cutting, failure to invest and production pressures by both BP and previous owner Amoco

increased risk of catastrophe. Budget cuts of 25% were targeted in 1999 and again in 2005.

• The BP Board of Directors did not provide effective oversight of safety culture and major accident

prevention programs.

• Deficiencies in BP’s mechanical integrity program resulted in the “run to failure” of process

equipment at Texas City.

• “Check the box” mentality at Texas City, where personnel completed paperwork and checked off

on safety policy and procedural requirements even when those requirements had not been met.

• No reporting or learning culture.

• Indicators of safety problems elicited little management response – “too little, too late”.

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Baker report recommendations:

• Corporate safety cultureLeadership, employee empowerment, resources and capacity building,

incorporation of process safety in management decision-making

• Process safety management systemsRisk assessment and analysis, compliance with safety standards, external

good engineering practices, knowledge and competence, safety

management systems

• Performance evaluation, corrective action and corporate

oversightMeasuring safety performance, incident and near miss investigations,

process safety audits, timely correction of deficiencies, corporate oversight

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Capability to

discover and

manage

unexpected

events

ReliabilityMindfulnessSensitivity to

Operations

Preoccupation

with Failure

Mindfulness in High Reliability Organisations

Weick et al (1999)

Reluctance to

Simplify

Commitment

to Resilience

Deference to

Expertise

Reliability

• Preoccupation with failureDon’t wait for catastrophic failures. Learn from small failures. Prioritize incident reporting, maintenance and audit.

• Reluctance to simplifyDon’t jump to simple answers. Seek diverse views.

• Sensitivity to operationsValue experience. Take time to develop understanding.

• Commitment to resilienceExpect the unexpected. Encourage critical questioning.

• Deference to expertiseDevolve authority to those with the most knowledge. Professionalism, not managerialism.

BP Macondo/Deepwater Horizon,

2010

Further reading

Antonsen, S. 2009. Safety culture and the issue of power. Safety Science, 47, 183-191.

Baker et al. 2007. The report of the BP US Refineries Independent Safety Review Panel.

Bourrier, M. 2011. The legacy of the High Reliability Organization Project. Journal of Contingencies and Crisis Management 19(1): 9-13.

Guldenmund, F. 2010. (Mis)understanding Safety Culture and Its Relationship to Safety Management. Risk Analysis, 30, 1466-1480.

Hopkins, A. 2000. Lessons from Longford: The Esso Gas Plant Explosion, Sydney, CCH.

Hopkins, A. 2008. Failure to Learn: the BP Texas City Refinery disaster, Sydney, CCH.

Reason, J. 1997. Managing the Risks of Organizational Accidents, Ashgate, Aldershot.

Roe, E. & Schulman, P. R. 2008. High Reliability Management: Operating on the Edge, Stanford, SUP

U.S. Chemical Safety And Hazard Investigation Board 2007. Investigation report: refinery explosion and fire. BP, Texas City, Texas, March 23, 2005. Report No. 2005-04-I-TX.

Weick, K. E. and Sutcliffe, K. M. 2001. Managing the Unexpected: Assuring High Performance in an Age of Complexity, Jossey-Bass, San Francisco.

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