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Importance of safety in organisations

Published

6 years ago

January 8, 2019

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When we think of safety in heavy industries, the first thing comes to our mind is the Factory Act and its requirement on statutory compliance. The sidekicks from compliance standpoint starts rolling the safety wheel in organisations, which always had its sub-optimal effect on the manufacturing process and team. What all want is "zero injury" with half-hearted effort and pessimistic belief that it is possible.

Organisations always guard to avoid and avert the ethical/unethical harassment associated with compliance due to numerous plant injuries, fatality or LTI (lost time injury).

Within every organisation, this calls for making numerous documents like procedures, SOP, leading/laggig metrics tracker, files/posters and slogans. Does this make the safety management holistic or full proof? The answer probably is in well-known to most of us. On other side of the coin, this opens up an optimistic door to deploy alternate school of thought and calls for motivating Safety professionals to relook the concept with different set of eyes. While concentrating more on software, we often tend to neglect the issues related to hardware. The issues of cost management and hardship acts as barrier for Safety professionals and they often find it difficult to sell safety in the board room competing with cost, IRR, cash flow and EBIDTA battle. Most of the times we sail through with country made "jugads" and hard work but sometimes we get trapped in situations where our confidence on safety management starts shaking up. The barriers in "Mindware" for making Safety management system effective and holistic escalates our hardship and we start searching for excuses at all levels of organisation for risks and failures affecting business and mankind.

Industrial safety in the organisation should not be a compliance gimmick but should be much deeper and wider to understand the basics of hardware, thoughtful integration of right software, and empowering/creating multiple teams with right mindware. So in this article, I am trying to touch upon issues which need introspection with "Back to Basics" approach. Safety is a common sense but uncommonly practiced and implemented across in most of the industries. Let’s for a moment focus on the widely followed hierarchy of safety control in most of the organisations and see where we can link PtD.

Right hardware: Need safety at design stage to eliminate hazards
While procuring an equipment during green field or brownfield expansion projects, safety rarely get a front seat and in most cases. Corners are cut for want of right safety aspect impact mapping or from cost/IRR standpoint. I had seen projects where during procurement and installation of machines, guards supplied by OEM found to be inadequate and the Project Proponents compelled to spent huge resources for modifying before start up only after failing post pre-start up safety audits and review.

National/international standards do exist for 360 degree machine guarding and mistake proof guards but this aspect really becomes meaningless in tender documents, PO and at design stage by OEM. Project managers remained often busy in managing project schedule and cost tracking and the poor safety manager’s struggles to comply and justify their job through retrofitting with additional resource and substandard work at site.

By considering safety at design stage, the lifecycle cost of equipment becomes less and safety aspects considerably improve. E.g: One of the components of the heavy industry is material handling and for that we need belt conveyors in different sizes and shapes. One common gap observed is regarding the right quality of side and end guards, which is inadequate enough to eliminate hand in machine risk. Most of the organisations fabricate guards locally post installation leading to high cost and poor quality guards lacking adequate safety interlocks. This never finds its place in main drawing and safety interlocks never integrated with operating system architecture.

This one aspect probably injures/kills multiple people in material handling activity in manufacturing plants. Sometimes it becomes difficult to punch in the idea of elimination at drawing room to protect cost of equipment/IRR during manufacturing.

Substitutes suggest managing through administrative control rather than engineering control and safety rolls out as usual in documents and SOPs. We prefer to start with the last layer of protection through PPE fully knowing that the route is least effective.

Here comes the concept of Prevention through Design (PtD), which is probably new to most of us. Dr OB Krishnana and Team at IIT Kharagpur are busy in developing this concept with much deeper meaning and associate deployable tools. As per definition PtD focuses on addressing occupational safety and health needs in the design process to prevent or minimise the work-related hazards and risks associated with the construction, manufacture, use, maintenance, and disposal of facilities, materials and equipment.

The steps which help in deep diving the PtD concept are:

Moving safety from an afterthought to a forethought in the design of facilities, processes , and productsConsideration of hazards and risks that would be moved as far upstream as possible in the design process/ planning in redesign process
Upstream includes all aspects of the orientation of business concepts, the relative decision making, and the design process, during which the greatest effectiveness can be achieve in hazard avoidance, elimination, or control in critical process like pyro and heavy engineering application
Barrier effectiveness rating system also to be put in place with escalation factor control

Potential barriers and issues faced in actual operating scenario are:

Lack of knowledge: This is not covered in engineering syllabus or handy available with equipment designers and hence the designers/engineers do not possess adequate knowledge on actual safety interlocks considering the Indian workforce on site
Ownership: Designers do not want to take the ownership of the hazards and its effects. While federal laws made designers responsible, Indian law and standards are inadequate to cover this. The factory act puts the emphasis on occupier and manager for mishaps and not the designer or supplier of equipment.
Misconception: Safety interlocks are costlier and hence equipment loose competitive edge. Key focus on initial cost and life cycle cost totally ignored.
Intentionally buy cheaper equipment or push the hazards to downstream. Difficult to identify hazards and interventions and post erection scenario do as little as manageable. More focus on site management "jugad".
Capacity upgradation/retrofitting: neither takes away all the hazards nor addresses the engineering controls in total. Some weak links left out at every site probably to check the intellectual level of Safety managers.
This may not be the true case for all organisations; progressive safety oriented organisations following holistic safety concepts have moved the needle to total elimination stage through right engineering control and eliminated substandard or dubious administrative control steps.

We need change: How agile our software?
Administrative control most of the time fall flat in Indian context due to lack of education and risk assessment capabilities of grass root workforce. Understanding safety at working stage need real time risk assessment and not a typed or documented SOP. Which need more "Boots on Ground" from supervisors and engineers daily to access the on job risk and creating a real time mitigation plan. This demands for an empowered team with positive software support across all sections of organisation starting from recruitment to promotions where safety baseline need to be mapped as key requirement for talent sourcing and retaining right talent at right place. Ownership of integrating safety as base line at every level of organisation must be clearly defined that to with strong cultural back up and belief that every incident can be prevented. Supervisors and managers must be authorised to stop unsafe job if risk factor is not mitigated then and there at site for the working team. The understanding, experience, motivation and commitment pledge a very vital role in safety. Hence progressive organisations need to define operation and support processes as part of right software to improvise safety DNA for zero injury.

How do we create sustainable & vibrating mindware
It’s every organisation’s DNA test. People are most valuable asset and their lives need to be protected. For that self believe that every incident is preventable ?must be injected at all levels of organisation. As per Dupont, you will get the level of safety excellence what you demonstrate and what we want. Ironically we all want zero Injury but when it comes to self-demonstration we take short cut and probably demonstrate that rule s are made for others and not for us. Senior/middle management in most organisations fall prey to this syndrome where they remain vocal about safety rules but lack practicing it.

That’s the reason some one travel without safety belt in car and helmet in motorcycle. Probably they do all these violations when they are out of plant and demonstrate daily in their personal life giving complex signals to the next generations and society. Persons operating with dual mask hamper safety more than improving it. That’s why some feels by evading safety values they grow in organisation fast as they are good "Jugad" masters and so called cost evangelists. Have we created agile organisation to address the issues and committed to change. The sooner we change will the better for mankind and humanity. Doing so in true sense, our country can be leagued with developed countries on safety aspect and impact.

Conclusion
Things can change if we accept to change. Every change is painful while becoming gainful from other perspectives. Safety team’s proactive engagement with OEM and organisation culture plays a vital role in this. Today we also can also sell safety as this makes perfect business sense through renewed prospective. Regulators and law makers also should look into these benefits and amend the regulations appropriately. One key activity can be done by universities and engineering institutions by introducing PtD in course curriculum to wider the concept and bring safety into driving seat.

Disclaimer
The views expressed in this article are the personal view point of the author and not linked to any company or its safety practices to be specific.

References
Learning from Dr O.B Krishnan, IIT, Kharagpur and Dupont Safety Solution.

ABOUT THE AUTHOR:

Ganesh Chandra Tripathy, Current Director Plant, ACC Chaibasa Cement Works, has decade long experience in OH&S and Sustainability across organisations like Unilever (South Asia), HZL, Jubilant Life Science and ACC. Safety behavioural observation in multi country and multi-site set up has helped him to understand true management issues on safety with hands on mitigation programme aligning Organisations for Holistic Safety improvement Plan. He can be contacted on: 8800693097 | tripathygc@gmail.com

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Price hikes, drop in input costs help cement industry to post positive margins: Care Ratings

Published

3 years ago

October 21, 2021

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Region-wise,the southern region comprises 35% of the total cement capacity, followed by thenorthern, eastern, western and central region comprising 20%, 18%, 14% and 13%of the capacity, respectively.

The cement industry is expected to post positive margins on decent price hikes over the months, falling raw material prices and marked drop in overall production costs, said an analysis of Care Ratings.

Wholesale and retail prices of cement have increased 11.9% and 12.4%, respectively, in the current financial year. As whole prices have remained elevated in most of the markets in the months of FY20, against the corresponding period of the previous year.

Similarly, electricity and fuel cost have declined 11.9% during 9M FY20 due to drop in crude oil prices. Logistics costs, the biggest cost for cement industry, has also dropped 7.7% (selling and distribution) as the Railways extended the benefit of exemption from busy season surcharge. Moreover, the cost of raw materials, too, declined 5.1% given the price of limestone had fallen 11.3% in the same aforementioned period, the analysis said.

According to Care Ratings, though the overall sales revenue has increased only 1.3%, against 16% growth in the year-ago period, the overall expenditure has declined 3.2% which has benefited the industry largely given the moderation in sales.

Even though FY20 has been subdued in terms of production and demand, the fall in cost of production has still supported the cement industry by clocking in positive margins, the rating agency said.

Cement demand is closely linked to the overall economic growth, particularly the housing and infrastructure sector. The cement sector will be seeing a sharp growth in volumes mainly due to increasing demand from affordable housing and other government infrastructure projects like roads, metros, airports, irrigation.

The government’s newly introduced National Infrastructure Pipeline (NIP), with its target of becoming a $5-trillion economy by 2025, is a detailed road map focused on economic revival through infrastructure development.

The NIP covers a gamut of sectors; rural and urban infrastructure and entails investments of Rs.102 lakh crore to be undertaken by the central government, state governments and the private sector. Of the total projects of the NIP, 42% are under implementation while 19% are under development, 31% are at the conceptual stage and 8% are yet to be classified.

The sectors that will be of focus will be roads, railways, power (renewable and conventional), irrigation and urban infrastructure. These sectors together account for 79% of the proposed investments in six years to 2025. Given the government’s thrust on infrastructure creation, it is likely to benefit the cement industry going forward.

Similarly, the Pradhan Mantri Awaas Yojana, aimed at providing affordable housing, will be a strong driver to lift cement demand. Prices have started correcting Q4 FY20 onwards due to revival in demand of the commodity, the agency said in its analysis.

Industry’s sales revenue has grown at a CAGR of 7.3% during FY15-19 but has grown only 1.3% in the current financial year. Tepid demand throughout the country in the first half of the year has led to the contraction of sales revenue. Fall in the total expenditure of cement firms had aided in improving the operating profit and net profit margins of the industry (OPM was 15.2 during 9M FY19 and NPM was 3.1 during 9M FY19). Interest coverage ratio, too, has improved on an overall basis (ICR was 3.3 during 9M FY19).

According to Cement Manufacturers Association, India accounts for over 8% of the overall global installed capacity. Region-wise, the southern region comprises 35% of the total cement capacity, followed by the northern, eastern, western and central region comprising 20%, 18%, 14% and 13% of the capacity, respectively.

Installed capacity of domestic cement makers has increased at a CAGR of 4.9% during FY16-20. Manufacturers have been able to maintain a capacity utilisation rate above 65% in the past quinquennium. In the current financial year due to the prolonged rains in many parts of the country, the capacity utilisation rate has fallen from 70% during FY19 to 66% currently (YTD).

Source:moneycontrol.com

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Wonder Cement shows journey of cement with new campaign

Published

3 years ago

October 21, 2021

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The campaign also marks Wonder Cement being the first ever cement brand to enter the world of IGTV…

ETBrandEquity

Cement manufacturing company Wonder Cement, has announced the launch of a digital campaign ‘Har Raah Mein Wonder Hai’. The campaign has been designed specifically to run on platforms such as Instagram, Facebook and YouTube.

#HarRaahMeinWonderHai is a one-minute video, designed and conceptualised by its digital media partner Triature Digital Marketing and Technologies Pvt Ltd. The entire journey of the cement brand from leaving the factory, going through various weather conditions and witnessing the beauty of nature and wonders through the way until it reaches the destination i.e., to the consumer is very intriguing and the brand has tried to showcase the same with the film.

Sanjay Joshi, executive director, Wonder Cement, said, "Cement as a product poses a unique marketing challenge. Most consumers will build their homes once and therefore buy cement once in a lifetime. It is critical for a cement company to connect with their consumers emotionally. As a part of our communication strategy, it is our endeavor to reach out to a large audience of this country through digital. Wonder Cement always a pioneer in digital, with the launch of our IGTV campaign #HarRahMeinWonderHai, is the first brand in the cement category to venture into this space. Through this campaign, we have captured the emotional journey of a cement bag through its own perspective and depicted what it takes to lay the foundation of one’s dreams and turn them into reality."

The story begins with a family performing the bhoomi poojan of their new plot. It is the place where they are investing their life-long earnings; and planning to build a dream house for the family and children. The family believes in the tradition of having a ‘perfect shuruaat’ (perfect beginning) for their future dream house. The video later highlights the process of construction and in sequence it is emphasising the value of ‘Perfect Shuruaat’ through the eyes of a cement bag.

Tarun Singh Chauhan, management advisor and brand consultant, Wonder Cement, said, "Our objective with this campaign was to show that the cement produced at the Wonder Cement plant speaks for itself, its quality, trust and most of all perfection. The only way this was possible was to take the perspective of a cement bag and showing its journey of perfection from beginning till the end."

According to the company, the campaign also marks Wonder Cement being the first ever cement brand to enter the world of IGTV. No other brand in this category has created content specific to the platform.

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In spite of company’s optimism, demand weakness in cement is seen in the 4% y-o-y drop in sales volume. (Reuters)

Published

3 years ago

October 21, 2021

admin

Cost cuts and better realizations save? the ?day ?for ?UltraTech Cement, Updated: 27 Jan 2020, Vatsala Kamat from Live Mint

Lower cost of energy and logistics helped Ebitda per tonne rise by about 29% in Q3
Premiumization of acquired brands, synergistic?operations hold promise for future profit growth Topics

UltraTech Cement
India’s largest cement producer UltraTech Cement Ltd turned out a bittersweet show in the December quarter. A sharp drop in fuel costs and higher realizations helped drive profit growth. But the inherent demand weakness was evident in the sales volumes drop during the quarter.

Better realizations during the December quarter, in spite of the 4% year-on-year volume decline, minimized the pain. Net stand-alone revenue fell by 2.6% to ?9,981.8 crore.

But as pointed out earlier, lower costs on most fronts helped profitability. The chart alongside shows the sharp drop in energy costs led by lower petcoke prices, lower fuel consumption and higher use of green power. Logistics costs, too, fell due to lower railway freight charges and synergies from the acquired assets. These savings helped offset the increase in raw material costs.

The upshot: Q3 Ebitda (earnings before interest, tax, depreciation and amortization) of about ?990 per tonne was 29% higher from a year ago. The jump in profit on a per tonne basis was more or less along expected lines, given the increase in realizations. "Besides, the reduction in net debt by about ?2,000 crore is a key positive," said Binod Modi, analyst at Reliance Securities Ltd.

Graphic by Santosh Sharma/Mint
What also impressed analysts is the nimble-footed integration of the recently merged cement assets of Nathdwara and Century, which was a concern on the Street.

Kunal Shah, analyst (institutional equities) at Yes Securities (India) Ltd, said: "The company has proved its ability of asset integration. Century’s cement assets were ramped up to 79% capacity utilization in December, even as they operated Nathdwara generating an Ebitda of ?1,500 per tonne."

Looks like the demand weakness mirrored in weak sales during the quarter was masked by the deft integration and synergies derived from these acquired assets. This drove UltraTech’s stock up by 2.6% to ?4,643 after the Q3 results were declared on Friday.

Brand transition from Century to UltraTech, which is 55% complete, is likely to touch 80% by September 2020. A report by Jefferies India Pvt. Ltd highlights that the Ebitda per tonne for premium brands is about ?5-10 higher per bag than the average (A cement bag weighs 50kg). Of course, with competition increasing in the arena, it remains to be seen how brand premiumization in the cement industry will pan out. UltraTech Cement scores well among peers here.

However, there are road bumps ahead for the cement sector and for UltraTech. Falling gross domestic product growth, fiscal slippages and lower budgetary allocation to infrastructure sector are making industry houses jittery on growth. Although UltraTech’s management is confident that cement demand is looking up, sustainability and pricing power remains a worry for the near term.