3 Lessons from High Reliability Organizations

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3 Lessons from High Reliability Organiza7ons

Presenta*on to the Canadian Na*onal Energy Board at the 2015 Pipeline Safety Forum

The world has changed!

2 www.wilsonperumal.com

“Individual produc7vity”

Volume

Cost

Pre-‐Industrial Age

Driven by variable costs

“Economies of Scale”

Volume

Industrial Age

Driven by fixed costs

“Complexity”

Complexity

Post-‐Industrial Age

Driven by complexity costs

Complexity is stretching the capabilities of most organizations


TECHNOLOGY PRODUCTS & SERVICES

PROCESSES

ORGANIZATIONS

REGULATIONS

MARKETS

X

X X

X

X COMMUNICATIONS

Complexity grows exponentially

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#Items #links

1 0

2 1

3 3

4 6

5 10

…

10 45

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Complexity

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Characteristics of complex systems

1. Non-linear reactions

2. Emerging properties

3. Feedback loops

4. Unknown interactions

Many companies are passing a complexity threshold

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Level of complexity you can support

VALUE (diminishing returns)

COST & RISK (exponen*al growth)

$

Complexity

Few companies are s.ll here

Many companies are here

An increasing number of companies are here


Increased complexity

Poor execution

Loss of process control

Poor performance

Added processes Vicious

Complexity Cycle

The typical response to complexity is to add even more complexity

Catastrophic incidents are becoming more frequent and more severe

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1979 – Three-‐Mile Island core meltdown 1988 – Piper Alpha explosion 2005 – Texas City Refinery explosion 2010 – San Bruno Pipeline explosion 2010 – BP Deepwater Horizon oil spill 2011 – Fukushima Daiichi disaster 2013 – West Fer7lizer plant explosion


Traditional risk management doesn’t address these “normal accidents” well

Too complex to anticipate

Too fast to address

Too infrequent to understand


The Pessimist’s View

“Regardless of the effec*veness of management and opera*ons, accidents in systems that are

characterized by *ght coupling and interac*ve complexity will be

normal or inevitable as they oTen cannot be foreseen or prevented.”

Wilson Perumal & Company, Inc. 11

Yet a few High Reliability Organizations seem to defy the Pessimistic View!

Birth of the Nuclear Navy

50+ year history

150 mobile nuclear reactors

6,000+ years of reactor plant opera*on


The Nuclear Navy has never had a reactor accident over its

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Three Lessons from the Nuclear Navy

#1 Safety is not a GOAL!

#2 Simplify your management system

#3 Culture kills!

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Lesson #1

Achieving zero incidents should not

be a GOAL!

It should be an EXPECTATION!

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This has important implications for what we reward

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Lesson #2: Keep your management system as simple as possible, but no simpler


The Nuclear Navy simplifies with one management system for all outcomes

People Process

Equipment Change

Key Controls

Safety

People Process

Equipment Change

Key Controls

Environ-‐ mental

People Process

Equipment Change

Key Controls

Quality

People Process

Equipment Change

Key Controls

Reliability

People Process

Equipment Change

Key Controls

Cost

Common Management System Approach

Nuclear Navy Management System

People Process

Equipment Change

Increased performance Accelerated learning

Reduced cost and overhead

Safety Quality

Environmental

Reliability

Compliance

Cost

Key Controls


Don’t manage the outcomes... …manage the sources of risk!

Examples

Procedures

Training/ cer*fica*on

Performance mgmt

Engineering disciplines

Maintenance planning/ scheduling

MOC process

Culture

Risk ID

Examples

No expecta*ons

Lack of knowledge

Wrong incen*ves

Equipment not capable

Process not capable

Inadequate MOC

Leadership Employee

Accountability Risk ID

Risk Control Knowledge Sharing Change

Management Con7nuous Improvement

Safety

Environment

Compliance

Quality

Produc7vity

Yield

Cost

Outcomes Sources of Risk

Causes of Failure

Key Controls

Mgmt. System Elements

People

Processes

Equipment

Change

Wilson Perumal & Company, Inc. 19

The Nuclear Navy’s proactive management system allows it to learn faster

Reactive risk management

Proactive risk management

Proac7ve

Reac7ve

Proac7ve

Reac7ve

Lesson #3: Culture is the key!

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Opera*onal Discipline is essen*al to the Navy’s superb safety and opera*onal record


Human performance is the Nuclear Navy’s last layer of defense

Rob

ust E

quip

men

t

Rig

orou

s P

roce

dure

s

Ope

ratio

nal D

isci

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The culture required was a vast departure from traditional military culture

Tradi7onal Military Culture

Follow orders

Do what you are told

Don’t ask ques*ons

Never ques*on your superiors

Rickover’s Cultural Pillars

Have a higher level of understanding

Follow procedures

Ques*on procedures when things don’t seem right

Back each other up

Do it all with integrity

The Nuclear Navy’s OD DNA

Level of Knowledge

Formality

Ques7oning Actude

Forceful Watch Team Backup

Integrity

LEVE

L OF KN

OWLEDG

E

FORM

ALITY

QUESTIONING ATTITUDE

FORC

EFUL BA

CKUP

INTEGRITY

CONTINUITY OF POWER REACTOR SAFETY

Safety and reliability depend on specific operator behaviors


The “Pillars of the Program”

The Pillars are self-reinforcing

Ques:oning A=tude enhances Level of Knowledge

Integrity Level of Knowledge

Ques7oning Actude

Formality

Forceful Watch Team

Backup

Level of Knowledge allows ID of out-‐of-‐

the-‐ordinary condi:ons

Ques:oning A=tude supports process improvement, not work arounds

Ques:oning A=tude helps you spot what others may have missed

Level of Knowledge allows you to back up others

Integrity means you can be relied upon to support

your team

Backup drives

procedural compliance Formality ensures

backup is professional & produc:ve

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Changing culture requires more than posters and training

Beliefs

Consequences Behaviours

Leaders can’t force people to believe something…….

……or to behave in a certain way.

But they can change what is rewarded!

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Three Lessons from the Nuclear Navy

#1 Safety is not a GOAL!

#2 Simplify your management system

#3 Culture kills!

27 [email protected]

Thank You

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Chris Seifert Partner, Opera:onal Excellence Prac:ce [email protected] (972) 800-‐3618 www.wilsonperumal.com

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3 Lessons from High Reliability Organizations

Leadership & Management

Transcript of 3 Lessons from High Reliability Organizations