Making business integration work: A survival strategy for EHS managers

Making Business Integration Work: A Survival Strategy for EHS Managers

Howard Brown and Timothy [arson

Realizing the benefits of environment, health, and safety EHS] management systems requires more than just rewriting policies and procedures, EHS tasks and actiuities must be ptrshed out into all aspecB of the organization. The success of this process necessitates an evolving role for EHS rnunagers. For EHS managers, business integration involves the challenge of integrating environment, health, and safety awareness, responsibility, and action into multiple jobs and business processes, leveraging scarce resources to maximize value and minimize costs. Drawing on recent work in the fields ofsociology and political science, this article presents conceptual tools for assistingEHS managers to planandstrategize the chungingrole of the EHSfunction. By assessing political opportunities, mobilizing structures, and framing processes, EHS managers a n maximize the success of EHS programs, while adding value to companies’core operations.

I he world of environmental management is changing. Whether under the auspices of corporate reengineering or IS0 14000, company after company is transforming the ways in which internal environment, health, and safety activities are managed, organized, and conducted. Element by element, environmental management systems (EMS) are being developed. Policies and standards are being rewritten; responsibilities are being assigned; compliance is being tracked; audit programs are being developed; training programs are being designed; best practices are being shared; performance is being measured.

Yet as progress is made in assembling the requisite EMS elements, the real challenges become apparent. How do you get employees to actually read and implement the policies and procedures? How do you get non-EHS employees to understand and follow through on their EHS responsibilities? How do you use metrfcs to improve performance? The devil is in the imple-

mentation. In most companies, even when the EHS function has been elevated to the vice presidential level, EHS goals and initiatives are isolated from core business strategy and functions such as marketing, production, accounting, and finance. EHS issues are viewed as separate: a necessary afterthought, an unwelcome but necessary cost of doing business. If EHS management systems are to become truly effective, this distinction must dissolve.

There are two sides to the EMS coin, First, the essential elements of a management system must be put in place. The configuration of EMS elements will vary from company to company, reflecting diverse priorities and needs. Exhibit 1 lists several common EMS elements. By codifying systems and desired practices, companies move away from the “heroes syn- drome,” where EHS knowledge and procedures reside only in the heads of a handful of dedicated staff. Formalizing the EHS management system elements, such

ENVIRONMENTAL QUAUTY MANAGEMENT / Spring 1998 / 1

Exhibit 1. Framework for Organizational Change? Making EHS Business Integration Work

EHS business integration involves the challenge of integrating environment, health, and safety awareness, responsibility, and action into multiple jobs and business processes, leveraging scarce resources to maximize costs. Walking through the three elements outlined below will help EHS managers to develop a sound strategy for targeting limited resources to leverage the effectiveness and value of EHS activities.

Political Opportunities Understanding the business context of EHS activities clarifies constraints and opportunities, allowing EHS managers to target limited resources for maximum benefit. Identify opportunities and obstacles; compare with EHS goals and programs; think creatively about turning business problems into EHS opportunities; prioritize by importance, difficulty, and business impact

What are the business trends affecting your company and industry? What are the highest priorities of senior management? What are the current priorities and initiatives of other departments with whom you must cooperate to achieve EHS integration? What are your company's environment, health, and safety goals? How do your company's EHS goals differ from those of leader companies and IS0 14000 goals? How can EHS goals be better aligned with other business objectives? What opportunities have the greatest potential for beneficial business impact? How can EHS goals be better described or packaged to fit with those of other key stakeholders?

Mobilizing Structures Business integration requires resources and mechanisms for promoting EHS activities and weaving them into routine operations. Inventory the people, programs, procedures, and tools that can be tapped to promote and deliver EHS services. Be sure to look beyond the EHS department and staff.

Framing Processes To successfully seize opportunities for adding business value, EHS managers must work to frame EHS goals, programs, and issues so they can be understood and of interest to multiple stakeholders. This can be accomplished by defining shared objectives, terminology, and values. Stakeholders need to believe problems andlor opportunities exist, and that they can be addressed through collaborative action.

What are the company's existing EHS programs (e.g., audit, metrics. waste minimization)? What people, programs, procedures, and tools are available to support EHS activities? How can EHS piggyback on or dovetail with other departmental or company initiatives? How can the existing EHS organization be modified to facilitate business integration and change?

Who are the key stakeholders for EHS business integration? How do the stakeholders perceive EHS problems, if at all? How can EHS staff best communicate EHS goals, Drograms, and accomplishments with different stakeholder - . - groups? How can EHS staff build shared perceptions of EHS problems and opportunities?

.The framework for organizational change presented in this article end table is adapted fromthe following reference: Doug McAdam, John 0. McCarthy, Mayer N. Zald. 'Introduction: Opportunities, Mobilizing Structures, and Framing Processes-Toward a Synthetic, Comparative Perspective on Social Movements.' Comperab'vs Perspecbires on Social Movements, Cambridge University Press, 1996.

as audit programs, policies and procedures, and training programs, creates the foundation for pushing EHS awareness and responsibility further out into the organization. But the momentum typically dissipates before integration occurs. These elements are essential, but not sufficient, for success.

The other side of the coin is business integration-life must be breathed into the EMS. For EHS managers, business integration involves the daunting challenge of

integrating environment, health, and safety awareness, responsibility, and action into multiple jobs and business processes, leveraging scarce resources to maximize value and minimize costs.

In order for EHS business integration to succeed, stakeholders must see value in the results of EHS activities. This is not to say that they must see environment, health, or safety value. For them, the benefits may be business-oriented-improved process efficiency, more rapid commercial-

2 / Spring 1998 / ENVIRONMENTAL QUALITY MANAGEMENT Howard Brown and Timothy Larson

ization, reduced risk. Many EHS activities have multiple benefits, and value comes in diverse forms:

Improved resource utilization rates; Reduced overall resource consumption

Lower EHS management costs; Streamlined product development cycles;

0 Reduced risks to the company, share- holders, employees, consumers, and environment; Improved worker productivity and mo- rale; and Enhanced marketability of products and services.

per unit of product/service delivered;

EHS business integration is about clarify- ing value, thereby creating incentives for every player to contribute to improved EHS performance.

THE EHS MANAGER AS CHANGE AGENT Often, when EHS managers learn

about new corporate restructuring initiatives, they head for the hills. It is easy to adopt a “head in the sand” posture, and hope that the architects of change do not notice the environment, health, and safety department. This is not wise strategy. The EHS manager of the future is an agent of organizational change-selling the benefits of responsible and proactive EHS behavior, and devising strategies to implement such actions. In addition to technical expertise in areas such as engineering and toxicol- ogy, the EHS manager of the future will benefit from skills in accounting, business strategy, marketing , finance , community organizing, education, and management consulting.

Navigating complex organizations to find and solve EHS and business problems is the key to adding value to a company- and business integration is the EHS manager’s primary vehicle for achieving this end, Operationalizing these ideas demands strategy and planning. As a col-

league of ours points out, “If a group of prisoners is trying to dig under the prison wall with spoons, they’ll be much more effective if they’re digging in the same place.” Knowing where to put one’s spoon to maximize the impact of one’s efforts and coordinate the action of others requires planning. There is no magic formula for successful integration of EHS awareness and activities throughout a company’s operations. As environmental economist Ha- zel Hendersen points out, success requires homework and chutzpah. “Homework” enables EHS managers to understand where to focus efforts, how to leverage resources (not just those in their immediate control) to produce maximum benefit, how to communicate (or “sell”) EHS goals and activities, and who to “sell” them to. “Chutzpah” involves the energy and drive to carry the EHS banner to a new level.

Homework reveals “trimtabs”-points of intervention where chutzpah can be most effectively applied. Long ago, aero- nautical engineers and naval architects discovered the benefit of using trimtabs to minimize the force needed to change direc- tions. A trimtab is the small tab on a large wing flap or ship’s rudder that allows pi- lots and helmsmen to turn their crafts without tremendous effort. By moving the trimtab, a low pressure zone is created that enables the large flap or rudder to move gracefully with minimal effort, turning the plane or ship. Well-known designer and philosopher R. Buckminster Fuller saw the metaphor to social and organizational change, postulating that there are certain points where a minor adjustment can leverage significant organizational or soci- etal change.’ The challenge of EHS business integration lies in identifymg these points of intervention-the trimtabs for organizational change.

FRAMEWORK FOR ORGANIZATIONAL CHANGE

In order to successfully integrate EHS thinking and activities into business pro-

The EHS manager of fhe future will benefit from skills in accounting, business strategB marketing, finance, community owanizing, education, and management consulting.

Making Business Integration Work: A Survival Strategy for EHS Managers ENVIRONMENTAL QUAUTY MANAGEMENT / Spring 1998 / 3

Understanding the company‘s product

development cycles and production

processes provides a valuable starting point

for designing and delivering value-added

€US services.

cesses, it is important for EHS managers to understand the factors that shape and con- strain organizational change. The study of sociology and political science can teach us much in this area. Scholars of social movements have developed theories about social change that can be used by EHS managers in the new corporate environment. One particularly useful approach has been formulated by Doug McAdam, John D. McCarthy, and Mayer N. Zald. Their “synthetic, comparative perspective on social movements” identifies three broad concepts for analyzing institutional transformation: political opportunities, mobilizing structures, and framing processes.2 While these three concepts were originally conceived to describe collective political action on the international scale, they can also provide an invaluable conceptual tool for strategizing effective EHS business integration, Below, we describe each of these factors, and how they can be used by EHS managers to further EHS goals in a corporate setting.

Political Opportunities EHS activities are shaped by the

broader political and economic context in which they take place-your company’s culture and politics, as well as the larger forces affecting the economy, your industry, senior management, and other departments within your company. These factors present opportunities and constraints that can be taken advantage of to create change. By inventorying these forces and trends, EHS managers can better identify opportunities to align EHS goals with core business objectives.

For example, understanding the company’s product development cycles and production processes provides a valuable starting poiht for designing and delivering value-added EHS services. If shorten- ing time-to-market or reducing the “number of touches” in the production process stand as strategic business drivers, a key political opportunity exists for the

EHS function. EHS managers can eliminate the perception of EHS as the “Department of Production Prevention” by identifying key points in the product development cycle where EHS involvement can save time, minimize risks, and foster process optimization and efficiency. By advocating EHS involvement earlier in the game, managers can avoid project delays and cost overruns associated with EHS permitting] engineering controls, and training needs.

If cost reduction occupies senior management attention, EHS managers can benefit from a concerted effort to track direct and indirect EHS costs. All too often, environment, health, and safety programs are perceived as a fixed overhead “cost of doing business. ]’ Valuable cost information is lost when it is not associated with a spe- cific project, product line, or department. A common business integration success story arises when an organization begins to charge individual departments for hazard- ous waste collection and disposal fees, rather than grouping the disposal costs into general facility operating expenses. By identifying cost streams that EHS activities can influence] corporate cost reduction initiatives do not have to result in fewer staff and resources for EHS managers. If expanding market share receives high organizational priority, EHS managers should ask themselves how beneficial environmental, health, and safety attributes of the product or service could be enhanced] since opportunities may exist for improving its marketability.

EHS managers must learn to understand what top management wants and needs, and then to think creatively about how EHS activities can support business objectives and deliver value to customers within the company, as well as the end users of products and services. What may have originally appeared to be political constraints to the EHS function (such as cost reduction, corporate restructuring, and reengineering) can now be trans- formed into intervention points where

4 / Spring 1998 / ENVIRONMENTAL QUAUTY MANAGEMENT Howard Brown and Timothy Larson

EHS staff can create strategic advantage to achieve EHS goals. The challenge lies in choosing where to focus limited EHS resources and staff time.

Step 1: Successful EHS business integration involves clearly assessing the opportunities (including many that are not at first obvious) for adding business value to a company. This is not as easy as it sounds. In order to see the opportunities, it is essential to ask the right questions. The questions listed below provide a useful starting point for identifying hidden opportunities.

Key questions to ask when identifylng political opportunities include:

What are the business trends affecting your company and industry? What are the highest priorities of senior management? What are the current priorities and initiatives of other departments with whom you must cooperate to achieve EHS business integration? What are the company’s EHS goals? How do your company’s EHS goals differ from those of leader companies or IS0 14000 goals? How can EHS goals be better aligned with other business objectives? What opportunities have the greatest potential for beneficial business impact? How can EHS goals be better described or packaged to fit with those of other key stakeholders?

Brainstorming lists of EHS goals, stakeholder groups and their goals, business trends, and obstacles to business integration can assist in getting ideas flowing. Mapping or flowcharting key business and production processes also enables opportunities for EHS intervention to be spotted more readily. While many EHS staff pos- sess a basic working understanding of production processes in their facility or company, few take the time to list and map them. Many are even less aware of the pro-

cesses by which capital investment, product development, and marketing decisions are made.

Step 2: The second step necessitates rating political opportunities according to importance (or potential for beneficial business impact) and difficulty of implementation. Given that resources are limited, where is the “bang for the buck”? What are the contextual factors that most influence the ability to succeed? Working through these steps and questions helps to answer “where” efforts to integrate EHS activities into core business processes should concentrate.

Mobilizing Structures Mobilizing structures are the vehicles

of change-the corporate organizational structures, programs, and resources (for- mal and informal) that can be used to promote and leverage EHS activities and objectives. Mobilizing structures address the “how” of EHS business integration.

Many EHS managers underestimate the availability of resources to support EHS activities. An inventory of EHS resources often stops with the departmental budget and those staff who have specifically-assigned EHS job responsibilities. Successful business integration demands that EHS managers identify potential allies with similar or overlapping interests, and utilize and “piggyback” on existing organizational resources and programs as much as possible. For example, if a company has a strong quality assurance program in place, it may make sense to incorporate EHS objectives and criteria into the quality framework and programs. Effective mobilizing structures leverage people, programs, procedures, and tools.

People. The goal is to make EHS part of every employee’s job. The first step is to involve staff who can assist EHS staff in achieving environmental, health, and safety objectives, One large manufacturing company found that by holding periodic “design for environment” training sessions

Successful business integration demands that EHS managers identify potential allies with similar or overlapping interests, and utilize and “piggyback” on existing organizational resources and programs as much as possible.

Making Business Integration Work: A Survival Strategy for EHS Managers ENVIRONMENTAL QUALITY MANAGEMENT / Spring 19% / 5

The key to building effective mobilizing

structures is to inventory the people,

programs, procedures, and tools that could be used to

support EHS activities within the

company.

for product designers and engineers, numerous potential EHS problems could be averted before a project left the drawing board. In effect, the company has recruited product engineers to provide the first line of EHS evaluation. The design engineers did not want to be given “more things to do,” but they were happy to receive and share information, and use analytical tools that would help them design more efficient and environmentally sound products. Sev- eral other companies have found that many non-EHS employees are gladly will- ing to volunteer time to assist with environmental initiatives if given the opportunity for involvement. These companies have organized “green teams” of employee volunteers to coordinate initiatives such as recycling, waste minimization, and energy conservation.

Programs. Not every EHS program needs to start from ground zero. For example, quality programs are well estab- lished in many companies and often create a platform on which EHS initiatives can be piggybacked. If a company operates an effective quality systems audit program, it may be beneficial to model a new EHS audit process on the quality audits. If the information technology department is planning a corporate intranet or new enter- prise-wide information systems, this may be a useful time to make EHS information system needs known (or even become a department for pilot implementation of new information systems). Other companies have attempted to increase overall EHS awareness by involving EHS staff in new employee orientation programs. In some cases, EHS criteria have been incorporated into performance evaluation and bonus programs.

Procedures. Opportunities abound for coordinating and codifying EHS activities in companies’ existing procedures and work processes. For example, many companies maintain project checklists to support various stages of the new product development and commercialization process.

By ensuring that important EHS questions and items are incorporated into these lists, EHS issues can receive sufficient attention at the appropriate time. Similarly, coordi- nation with the purchasing department can enable EHS staff to receive more useful summary reports of new chemical pro- curement, simplifying SARA reporting procedures. Too often, EHS procedures are regarded as a separate set of hassles to worry about, rather than integral steps in larger core business processes.

Tools. Tools come in many forms. Of- ten the most useful for EHS business integration purposes are communications tools-newsletters, bulletin boards, meet- ings, conferences, computer intranets, and other information system tools. While creating a dedicated EHS newsletter can be worth the effort, writing articles or col- umns for the general company newsletter can have far greater impact per hour spent. Intranets, electronic mail, and other information system tools hold extraordinary potential for broadening access to EHS information throughout companies.

The key to building effective mobilizing structures is to inventory the people, programs, procedures, and tools that could be used to support EHS activities within the company. This requires thinking broadly (beyond traditional EHS resources) and creatively. This step also necessitates talking with and learning about other departments’ activities and programs-and telling them about EHS initiatives. By matching this inventory with the priority political opportunities identified above, effective strategies become apparent that can stretch limited EHS staff and fi- nancial resources (and impact) much further than previously imagined.

Key questions to ask regarding mobilizing structures include:

What are the company’s existing EHS programs (e.g., audit, metrics, waste minimization)? What people, programs, procedures


and tools are available to support EHS activities? How can EHS piggyback on or dovetail with other departmental or company initiatives? How can we modify our existing EHS organization to facilitate change?

Framing Processes In order to seize political opportunities

and create organizational change, EHS managers must generate a common understanding among stakeholders. A “framing process” conditions key stakeholders’ perceptions so that they believe that significant problems or opportunities exist, and that they can be addressed effectively for mutual benefit through collaborative action. This is accomplished by defining shared visions, terminology, and values. In short, EHS managers must kame issues so that stakeholders understand them and feel compelled to act. They must be will- ing to help others see how cooperating with EHS staff will lead them to success, and how they can use the EHS organization for their benefit.

Becoming conversant in the languages of other stakeholder groups is a first and essential step. How can EHS activities, issues, and information be best communi- cated to interest and mobilize a particular stakeholder group? While a plant engineer may be interested in kilowatt hours, the board of directors probably cares more about aggregate dollar savings. Often, effective communication comes down to se- mantics. At one Fortune 500 company, senior executives took greater interest when EHS staff renamed their waste reduction efforts as process optimization-increasing resource and raw material utilization rates. Most EHS staff feel relatively comfortable communicating technical aspects of an issue or project. Failure to make the transla- tion into the language of business, how- ever, often results in the message not being heard. Representation in terms of dollars, return on investment, person days, time-to-

market, risk avoidance, or other measures can generate a very different reaction to the same issue. But this requires the EHS manager to learn the specialized jargon of other key stakeholders.

EHS issues are business issues. Waste and pollution are bad for business. They represent pr’oduction inefficiencies and wasted resources. Many EHS staff tend only to celebrate their successes i f they were done purely for EHS reasons. Find the environmental successes that were made for other business reasons; celebrate them; give credit and recognition to those who did them. Examples include extend- ing product life, reducing the use of toxic chemicals or materials, turning waste streams into useful products, product min- iaturization, or eliminating the need for extra packaging.

The ability to communicate effectively with other departments is especially important as EHS managers are increasingly being called on to “sell” the value of EHS services throughout the company. In companies that have adopted a Shared Services approach to delivering EHS services, the need for this new customer service mental- ity rings particularly loud. EHS managers must be perceived as problem-solvers, or demand for services will wane. The good news is that EHS managers have a unique vantage point. Few others within a company are better positioned to broker information, resources, and best practices across a company. By altering the EHS function’s role from saying “yesho” to presenting “options,” EHS staff will be regarded more as helpful advisors and less as internal policemen.

It is this third factor, framing processes, that demands the greatest transition for most EHS staff. Interdisciplinary communication and understanding require a different skill set from the engineering, in- dustrial hygiene, or toxicological abilities needed for more traditional EHS activities. By demonstrating how EHS activities and business integration can improve product

At one Fortune 500 company, senior executives took greater interest when EHS staff renamed their waste reduction efforfs as process optintization- increasing resource and raw material utilization rates.

Making Business Integration Work: A Survival Strategy far EHS Managers ENVIRONMENTAL OUAUTY MANAGEMENT / Spring 1998 / 7

quality, enhance work conditions and productivity, reduce risk, ensure regulatory compliance, speed time-to-market, save energy and materials, and increase product marketability, EHS managers will build a stronger, more central role in business operations.

Key questions to ask regardingfmming processes include:

Who are the key stakeholders for EHS business integration? How do the stakeholders perceive EHS problems, if at all? How can EHS staff best communicate with different stakeholder groups? How can EHS staff build shared perceptions of EHS problems and opportunities?

INTEGRATING EHS INTO OPERATIONS Although walking through the process

outlined above provides critical information that is necessary for targeting resources and effort, the best laid plans fal- ter without concerted efforts to implement them. Keep the following points in mind:

1. Be proactive. 2. Focus on the end goals. 3. Optimize feedback to all stakeholders. 4. Improve continuously. 5. Collaborate and distribute responsi-

bility.

Begin with realistic and achievable goals. Plan for early successes to build momentum and raise organizational EHS awareness. Celebrate successes, even the small ones. While EHS busiaess integration brings numerous challenges, opportunities abound. Remember to seek them out.

NOTES 1. Calvin Tomkins, The New Yorker. August 1, 1966, p. 64

(article on R.B. Fuller). 2. The framework for organizational change presented in

this article is adapted from the following reference: Doug McAdam, John D. McCarthy, Mayer N. Zald. 'Introduc- tion: Opportunities, Mobilizing Structures, and Framing Process-Toward a Synthetic, Comparative Perspective on Social Movements." Comparative Perspectives on Social Movements, Cambridge University Press, 1996.

Howard Brown, President of RPM Systems, Inc., is an authority in the field of environmental management, and has taught environmental planning at Yale Univer- sity and Wesleyan University. He has served as a con- sultant to dozens oflarge and small corporations, public agencies, andnonproiitinstitutions, and has helped enhance quality and revenue fornumerous Fortune 500 companies. Timothy Larson, a Project Manage rat RPM Systems, is a specialistin environmentalstrategy and management systems planning. He has worked with public and private organizations at the local, national, and international levels.

This article addresses ideas from the authors' workshop on EHS business integration that was conducted at the September 1997 IBC Conference in Washington, DC, "Integrating €H&S Into Core Busi- ness Processes." The authors wish to thank Todd Rogow, Rebecca Quarno and Cathy Van Dyke of RPM Systems for their valuable contributions to the ideas expressed in this article.


Making business integration work: A survival strategy for EHS managers

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