Local Feature story

SAFETY PRODUCTS - Pt 2: Two-pronged approach to forklift safety - the carrot and the stick

Thursday, 19 August 2004 ( #0 )
Pall-Ex's Mark Pulford ... good strategy
Pall-Ex's Mark Pulford ... good strategy
Greater rewards for improving workplace safety practices, combined with stricter compliance regimes, are the keys to safer forklift operation, writes BERNARD LEVY in the final part of this special series.

WHEN it comes to the question of ensuring return on investment, it goes without saying that business executives and proprietors must be hard-headed and pragmatic in the decisions they make.
This applies every bit as much to outlays on mandated safety practices and products as it does to core business expenditures.
One argument gaining currency in forklift industry circles is that government safety regulators and insurers could make the investment in workplace health and safety more worthwhile by promoting rewards for companies demonstrating a commitment to improving their standards and practices.
This would provide a significant incentive for greater spending on forklift safety products and services, particularly among supervisors or middle-level managers who need to justify the money they spend to senior management or company directors.

More incentives encouraged
Senior procurement specialist for The Kroger Company, the largest supermarket conglomerate in the US, Greg Goosman said a reward system would be welcome, but appeared to be slow in emerging in North America.
"A company of Kroger's size does not buy safety items to be nice," he said. "We buy them to reduce injury and damage costs.
"Our push is for safety at all times, and at present this is guided by risk assessment in our various divisions as well as by injury and damage reports.
"If the insurance industry can show that these injuries are causing our claims, and therefore we have to buy additional safety items, then that becomes a new [de facto] law and we will just have to comply with it and buy those safety products.
"Now, if the companies that make these safety products come back to us and say 'here's some new items' and the incentive is that they will cost you USD100 but your real cost will be only USD30 through your OEM (Original Equipment Manufacturer) and the rest of those costs will be absorbed by the insurance folks in lieu of future claims - this may be something worth looking at.
"Unfortunately this is not the case in the US at present and we are not going to pay for more than we have to - this is an economic decision.
"The reality is if I cannot show that this will affect my bottom line and balance sheet, I won't buy it."

Compensating for negligence
Goosman said that while government health and safety regulations were tough enough as they stood, Kroger had a policy of purchasing and applying safety products to compensate for, or mitigate against, employee negligence.
"At present, I estimate we add around 10% to the cost of our 'base unit' forklift in safety features, not just to meet government regulation, but to go beyond it where we feel this is necessary.
"We would add even more safety products if there were incentives to increase the comfort and safety of the operator at no further overall charge to the company."
Kroger, with sales of USD53.8 billion in 2003 and USD16.9 billion in the first quarter of 2004, operates more than 2500 stores across the USA under 24 chain-store brand names such as Ralphs, Food 4 Less, City Market, Smith's, Dillon, QFC, Cala Foods and Barclay Jewelry.
The Cincinnati, Ohio-based company operates some 15,000 forklifts, with a total of 5000 machines at its 2500 stores, 240 at each of its 38 distribution centres and about 30 at each of its 45 manufacturing plants.

Company safety awards planned
Mark Pulford, general manager of operations at Pall-Ex, which oversees the transshipment of freight to and from a network of local postcode-area member companies throughout the UK and Europe, said he believed the "carrot and stick" approach to improving forklift safety was a sound idea.
"If you have nothing to hide, you shouldn't be frightened of the stick," he said.
"But unfortunately, I have not seen much by way of 'carrots' from the regulators or insurers and there is very little evidence of this kind of approach emerging at this stage in the UK.
"But I totally agree it's a good strategy if it can be made to work without too great a cost to the end-users.
"At Pall-Ex, we're already examining the possibility of establishing an industry sector recognition system for companies that demonstrate a commitment to improved workplace health and safety.
"The system would be specific to pallet movement networks like ours - perhaps similar to the Road Transport Industry Training Board's (RTITB) certification system for operators, but designed for 'safe practice' companies as a whole."
Formed in 1996, Pall-Ex has established itself as one of the UK's largest palletised freight companies, with operations extending throughout Europe.
The company handles up to four million pallets a year through its 90 depots, and its main hub at Ellistown moves an average of 8500 pallets a day.
Undergoing rapid expansion, Pall-Ex earlier this year announced it was spending GBP12 million (USD22.27 million) to expand the main Ellistown hub and open a new facility at Bardon, Leicestershire.

Double-edged sword
Pulford said Pall-Ex also had recently appointed a full-time health and safety manager who would be involved in all aspects of risk assessment at forklift sites, as well as having input into the purchase of additional forklift safety products.
"In terms of measuring the benefits of safety products against the financial bottom line, my view is that if you look after the health and safety elements, you are not only looking after the operator, but also the forklift truck itself.
"A forklift equipped with the right safety products will not only experience less damage, it will also do less damage - it's a double-edge sword."
Pulford said Pall-Ex was putting a senior manager through an RTITB examiner's course to establish its own in-house forklift training school, to which affiliated network companies could send their forklift operators and warehouse managers.
"Because forklifts are among the main tools of our business, we give forklift safety an extremely high priority because we would suffer commercially if we didn't," he said.
"For a company of our size, there are real and measurable benefits from applying safety products and practices.
"But among smaller companies that may only use their forklift occasionally, safety issues don't get the same priority - yet these are the very environments where safety products are most needed to reduce accident and injury."

Smaller companies targeted
CEO of the UK's Fork Lift Truck Association (FLTA), David Ellison said it was vital to spread the forklift safety message among such small-to-medium enterprises (SMEs).
"The FLTA is committed to raising safety awareness in SMEs that have only one or two fork trucks and whose managers and operators regard these machines as having a low priority compared to other parts of the business," he said.
"These people are not being negligent deliberately.
"They are just so focused on their business targets and staying profitable.
"How can they possibly give a simple forklift the justice it deserves, given all the rules and regulations that apply to its safe operation?"
Ellison said that in the UK forklift sector, few "carrots" or rewards were being offered by regulators or insurers for improved safety standards.
"The UK Health & Safety Executive uses a stick, but I don't think there's much of a carrot," he said.
"Any company that is really interested in rewards for better forklift safety standards will develop its own strategy.
"If they wanted to wield a stick, they would, for example, get rid of employees who are not competent to operate a forklift and are dangerous behind the wheel."
Ellison said the FLTA supported offering rewards and had already instigated a 'safe user group' strategy designed to encourage companies to operate their forklifts more safely.
"These companies receive updated safety information and are issued with certificates that confirm they are committed to improving safety standards, either by investing in forklift safety products or changing their operating practices, or both," he said.

Dirk von Holt ... differing standards
Dirk von Holt ... differing standards
Uniform standards needed
President of the Industrial Truck Association (ITA) and head of forklift maker Jungheinrich in the US, Dirk von Holt said differences in health and safety laws between the US and Europe impacted on sales of forklift safety products, and needed to be ironed out.
"In Europe, for example, when an operator is manning an order-picker truck, they are supposed to be guarded by a barrier on all three sides," he said.
"In the US, this is not necessary - it's enough to have a harness or a belt to prevent the operator from falling when they accidentally step off a truck or a pallet; the Europeans won't allow just a belt.
"But whatever the country or the regulations, safety guards on the sides of seats are effective in stopping drivers falling out of the forklift if it rolls over, and various companies are producing these.
"New types of swivel seats are also being produced to reduce the incidence of back pain among drivers, based on swivel seat technology from the automotive industry.
"But probably the most effective safety product development in recent years has been in electronic fleet monitoring systems, where drivers have to punch in a code and the system monitors their performance.
"Essentially, these systems can help a manager or supervisor conclude who is a safe driver and who is not, and they can be particularly valuable tools in the driver training process."

'Brand equity' enhanced
TVH Australasia CEO Steve Cunliffe said the safe operation of forklifts suffered where there were few or no repercussions to a company or its management from non-compliance with safety regulations.
"In these situations, management doesn't put much focus on safety and this directly affects the purchase of safety products," he said.
"Mature and evolved industries and sophisticated manufacturers take an enlightened and proactive view of safety products.
"They don't look at how much can be saved by skimping, but rather they look at how the 'brand equity' of their business is enhanced through their safety policies and practices."
Cunliffe said that in the past few years, there had been a noticeable increase in sales of forklift safety products as a result of stricter compliance laws.
Demand had increased for products such as flashing or strobe lights, reversing alarms, safety platforms, weather shields, suspension seats to reduce back strain and fork extensions with automatic locking mechanisms that allow the driver to remain in his/her seat rather than dismount to fit the extension manually.

Real returns on safety investment
Andrew Hackett-Smith, managing director of Melbourne-based Amskan, which produces the Fork-Alert system, said he believed sales of forklift safety products would increase if government regulators made a greater effort to demonstrate to businesses how they could secure a return on investment from safety spending.
"The authorities need to simultaneously enforce compliance and reward companies that demonstrate improved workplace health and safety practices," he said.
Hackett-Smith said that in his experience, companies were generally becoming more aware of the need to address forklift safety issues and that overall, the actual price of safety products was gradually diminishing as the key issue for consideration.
"In recent years, I've noticed that when companies get to the point of spending money on our product, they have already identified the benefits to their business in terms of cutting down production losses and preventing forklift accidents," he said.
"The rewards of making the investment have already been established in their minds, and this goes above and beyond the need to comply with safety regulations."

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