Bring complex regulations down to size with a platform designed to streamline compliance and entrench best practices.
In 2019, there were more than 5,000 worker fatalities in the US according to OSHA. That equates to an average of 100+ deaths a week or nearly 15 deaths every day. Supply chain incidents do happen, but they can be prevented.
Conducting regular hazard analyses is fundamental for businesses to stay proactive on emerging risks within their businesses.
Where to start?
Employees can be your greatest asset when developing a successful hazard analysis as they’re the ones who understand best the day-to-day tasks and the issues that may arise. Furthermore, having employees own their safety management creates a level of accountability and could show better results.
Putting together a hazard analysis can seem like a challenging task—that’s why we partnered with safety thought leader, Tim Page-Bottorff CSP, of CIT to put together an in-depth guide on how to go about it.
Let’s get started on your journey for a successful hazard analysis.
What is a hazard analysis?
A hazard analysis uses various techniques to evaluate possible job- or task-related risks before they occur. During a hazard analysis, employees or management will analyze every supplier, worksite or machinery to identify existing hazards and eliminate conditional and operational changes that create these hazards.
The best way to go about a hazard analysis is to develop a framework that lays down a set of guiding principles that can be followed in a step-by-step approach:
Pre-analysis This step involves preparing for the main analysis while setting expectations based on previous risk factors, records, and guidelines.
Historical review: analyzing previous injuries, illness, accidents, and close-calls at the company.
Employee involvement: involves open communication with employees about tasks and encourages their participation.
Ensure compliance with regulatory authorities: incorporating local and global regulatory requirements like OSHA 29CFR1910.132 and ISO 45001.
Set priorities: prioritizing specific jobs or areas for the analysis, which can save time and narrow down expectations.
Hazard Analysis This step is the actual analysis, where comprehensive insights are gathered and used to prevent hazards.
Break the job into steps: breaking tasks down into steps and recording them ensure they’re later reviewed and measure appropriately.
Hazard identification: laying out potential risk factors, probable errors, and their consequences for each hazard.
The hierarchy of control and control measures: utilizing hierarchy of control for hazards to determine where the hazard occurs, and the workers involved. This step also includes training and awareness on proper hazard controls, hazard substitutions, and protective gear/tactics.
Hazard review and elimination: reviewing identified hazards with the employees as appropriate for their respective jobs.
Post-analysis safeguards This final step comprises utilizing the insights gathered from the analysis to implement viable hazard prevention measures.
Apply prescribed changes: Using the insights gathered from the analysis, management can take preventive measures, such as securing unsafe conditions and processes and properly training workers on new, recommended safety workflows.
Review hazard parameters: periodically review the findings from the job hazard analysis to identify any risks that have been missed or ones that may manifest later to avoid any mishaps.
How Avetta can help
At Avetta, we provide a personalized platform for your business to achieve hazard-prevention success—with technology and staff to help you identify, track, and improve hazards in your supply chain. With Avetta’s comprehensive verification and assessment services, including the Avetta Risk Assessment Tool and Avetta One, companies can verify whether supplier safety controls and policies are up-to-date and compare established policies and procedures against accident and hazard investigation forms and training logs to ensure proper controls are implemented.
Avetta’s solutions help companies make smarter decisions faster by leveraging predictive capabilities and automated distribution of key reports and dashboards, resulting in improved performance and safety.
Many are predicting an economic downturn due to inflation rates, recent market performance, and continued global uncertainty caused by events like the Russia war in Ukraine. Forward-thinking companies are starting to prepare now.
A huge lesson from the COVID pandemic was just how fragile supply chains are, and how dependent businesses are on them. When storms are ahead, we tend to see two types of company reactions: those who stay with the “status quo” and those that accelerate IT investment and digitization.
The digitization of supply chain risk management (SCRM) is still growing. Surprisingly, even post-COVID pandemic, recent Gartner research cited that only 21% of supply chain organizations believe they have a highly resilient network today. The best way to weather any upcoming downturn is to improve supply chain resiliency, particularly focusing on digitizing supply chain risk and compliance.
The following are five reasons companies should double-down on their SCRM IT investment before heading into an economic downturn.
1. “Status quo” SCRM operations require significant resources
Avetta did a study on how many full-time employees (FTEs) it takes to proactively operate a successful SCRM program without technology. Our findings show that it takes 18.3 FTEs to proactively manage every 1,000 suppliers. That’s an average of $2.2 million per 1,000 suppliers.
What do we mean by “proactively operate a successful SCRM program”?
2. Manual operations cause more incidents
The simple fact is that no company dedicates 18.3 full-time employees per 1,000 suppliers to manage their supply chain operations. This means that good compliance operations are either not done or are conducted by people who are doing other jobs. As a result, suppliers are likely not trained, educated, or monitored well, which translates to more incidents, accidents, and out-of-compliance events.
3. Incidents are expensive
The National Safety Council (NSC) cites a safety accident as costing $47,000 per accident, and a fatality costing $1.2 million per fatality. Countless other types of incidents (environmental, cyber, financial, etc.) can impact your supply chain and are each quite costly, including the following examples.
4. Supply chain disruptions are costly
A Gartner article on SCRM cited that 89% of companies experienced a supplier risk event in the past five years. In this McKinsey report, they stated a long-term disruption could cost companies 30-50% of a year’s EBIDTA and even a disruption that lasts only 30 days could equal losses of 3-5% of EBITDA. Disruptions are caused by accidents, natural disasters, key suppliers going bankrupt or caught in fraud, a cyber-attack, sanctions violations, and many other hidden risks.
5. Brand damage is the most expensive
Many brands don’t recover when they are caught doing business with a contractor involved in a dangerous activity or illegal operations like bribery, child labor, or slave labor. Also, if a supplier leads to an accident or data breach of confidential information, it’s the organization that hired them whose brand is damaged, regardless of whether the liability for the event sits with the supplier.
Harvard Business Review found that 70-80% of an organization’s market value comes from intangible assets like brand reputation. In a study by The Economist, business leaders say the biggest consequence of supply chain disruption is “tarnished brand reputation.” 30% of those leaders have seen more customer complaints due to supply chain issues, and 23% saw less business from regular customers.
The Solution for a Strong Supply Chain
Deploying a multi-risk, global SCRM platform like Avetta One can not only surface hidden risk in your supply chain but can also streamline operations and profitability.
Here are three critical reasons for digitalizing your SCRM program on a platform like Avetta One:
1. Resiliency: Organizations that use the Avetta One SaaS platform can see whether their suppliers have credit problems, liens against their business, a history of safety or environmental incidents, past or current legal proceedings, sanctions violations, or do not have complaint polices or programs in place. These are leading indicators of the health and risk of any supplier that a company may depend upon. If a supplier is at high risk, companies can use the Avetta pre-qualified network to source alternative or backup suppliers that provide similar services in similar regions.
2. Agility: During the COVID pandemic, Avetta companies were able to communicate and deploy new COVID-19 protocols to their entire supply chains in a matter of weeks. By utilizing the Avetta messaging center and compliance tasks lists, new policies were communicated, deployed, and assessed in real-time. As new risk and compliance programs are rapidly evolving, having a digital and collaborative network to manage your supply chain will provide new levels of agility.
3. Cost Savings: Avetta has conducted many ROI and case studies with its clients. Companies that use Avetta on average see:
Economic storms may lie ahead, but your supply chain risks do not have to stay hidden as you weather uncertain economic conditions. The good news is an investment in a SCRM platform today will drive streamlined operations, business continuity, and cost savings that will solidify your supply chain against whatever the future has in store.
By integrating with SAP® Ariba® Supplier Risk, the platform enables businesses to monitor supplier compliance status in real time, helping companies manage safety, sustainability, and business risk.
Orem, Utah and HOUSTON — Oct. 20, 2022 — Avetta®, LLC, a leading provider of supply chain risk management (SCRM) software, today announced that its Supply Chain Risk Management platform is now available on SAP® Store. Through integration with SAP® Ariba® Supplier Risk, the platform provides critical insights into supplier management workflows enabled by SAP Ariba solutions.
“Integrating Avetta’s Supply Chain Risk Management data directly into business processes enables our customers to make better decisions towards safe and sustainable procurement practices,” said Taylor Allis, chief product officer at Avetta. “We are excited to collaborate with SAP and offer our platform on SAP Store to reduce risks in the supply chain for our customers with solutions that will transform supply chain operations.”
Using the Avetta platform, businesses can check supplier compliance status in real-time and identify high-risk vendors within their supply chains. Avetta provides critical decision-making data to help decrease risk events within an organization.
The Avetta Supply Chain Risk Management platform delivers the following benefits:
SAP Store, found at store.sap.com, delivers a simplified and connected digital customer experience for finding, trying, buying and renewing more than 2,000 solutions from SAP and its partners. There, customers can find the SAP solutions and SAP-validated solutions they need to grow their business. And for each purchase made through SAP Store, SAP will plant a tree.
Avetta is a partner in the SAP PartnerEdge® program. The SAP PartnerEdge program provides the enablement tools, benefits and support to facilitate building high-quality, disruptive applications focused on specific business needs – quickly and cost-effectively.
The Avetta SaaS platform helps clients manage supply chain risk and their suppliers to become more qualified for jobs. For hiring clients in our network, we offer the world’s largest supply chain multi-risk management network to manage supplier safety, sustainability, worker competency and performance, and business and financial risk. We perform contractor prequalification and worker competency management across major industries, all over the globe, including construction, energy, facilities, high tech, manufacturing, mining and telecom.
For suppliers in our network, our audit and verification services help lower their safety incidents rate by 29%. As a result, nearly 50% of members find additional job opportunities within the first year of joining. In addition, our suppliers receive privileged access to the Avetta Marketplace, where dozens of partners offer special discounts for business services like insurance and work gear. Avetta serves 500+ enterprise companies and 125,000+ suppliers across 120+ countries.
Visit https://www.avetta.com/ for more information.
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Mark Fredrickson, +1 801-806-0161