CDB4633 : TECHNICAL MANAGEMENT

FOR PROCESS SAFETY

 “The only man who behaves
sensibly is my tailor; he takes my
LEADING
measurements anew every time he
AND
sees me, while all the rest go on
LAGGING
with their old measurements and
INDICATORS
expect me to fit them.”
George Bernard Shaw

Presentation Title (acronym) ; Performance Indicator & Compliance Audit

Division – Name/OPU/HCU/BU (acronym) ; Chemical Engineering Dept.
Name of Presenter Azizul bin Buang 2
 Instructional Learning Objectives

At the end of this session participants will understand:

Concept of performance indicator

A common definition of leading & lagging indicators
How to use indicators to measure organizational
safety performance
Importance of compliance audit
Elements required to develop compliance audit
programme
 Industrial Performance
– Use of Indicators
CONTENTS OF
PRESENTATION
Leading & Lagging
Indicators

Compliance Audits

Presentation Title (acronym) ; Performance Indicator & Compliance Audit

Division – Name/OPU/HCU/BU (acronym) ; Chemical Engineering Dept.
Name of Presenter Azizul bin Buang 4
INDUSTRY ISSUES: PERFORMANCE
“It is not possible to manage what you cannot control and you cannot
control what you cannot measure!”
(Peter Drucker)

How does one company’s process safety performance compare to others ?

Is a company headed for a major accident ?
Is the company improving its process safety performance ?
Performance measurement is important – identifies performance gaps
between current and desired performance and provides indication of
progress towards closing the gaps. Carefully selected key performance
indicators identify precisely where to take action to improve performance.
INDUSTRY ISSUES: PERFORMANCE

• Performance gaps – e.g. occurrences of incidents. Hence

measuring performance to identify ways for preventing
incidents.
• Finding the perfect measure of safety is a difficult task.

• What you want is to measure both the bottom-line results

of safety as well as how well your facility is doing at
preventing accidents and incidents.
• Hence, need for indicators that measure how well safety is
being managed in major hazard facilities
USE OF INDICATORS

An essential element of any

improvement program is the measure of
existing and future performance.

Safety management systems ultimately

aim to prevent harm.

Indicators can directly measure of this

harm, and also measure things that are
in some ways precursors (signs) to harm
 ndicate
To point out, make known,
show, be a sign of.

ndicator
Person or thing that points
out or indicates
MEASUREMENT OF EFFECTIVENESS OF PSM

Presentation Title (acronym) ; Performance Indicator & Compliance Audit

Division – Name/OPU/HCU/BU (acronym) ; Chemical Engineering Dept.
Name of Presenter Azizul bin Buang 9
MEASUREMENT OF EFFECTIVENESS

Reduce Reduce Reduce Increase

Risk Injury Cost Profit

Why measure performance ?

• reduce risks
• accident early warning system (leading indicators)
• increase awareness of safety, health and environment issues
• means for checking whether goals are being met / realistic
• basis for deciding on allocation of safety-related resources
Performance Indicators
• Operational control indicators monitor actual process control
o critical operator actions / procedures
o control and instrumentation systems trips / alarm
• Risk control system indicators monitor effectiveness of key parts
of PSM / SMS
o Management of Change
o Permit-to-Work
o plant maintenance
• Program indicators
o % of plant inspections
o % of safety audits completed on time
SAFETY INDICATORS
Two dimensions of safety indicators can be distinguished:
❑ personal safety versus process safety indicators
❑ lead versus lag indicators
 Process Safety vs. Personal Safety:
Two distinct safety disciplines
Distinction between different types of hazards
– process safety hazards are those arising from processing activity
– personal safety hazards affect individuals but have little to do with processing
activity
MEASURING PERFORMANCE
Adopt leading and lagging indicators

Leading indicators – measure the effectiveness of preventive

and control measures
Lagging indicators – measure incidents or failures that have
happened

Presentation Title (acronym) ; Performance Indicator & Compliance Audit

Division – Name/OPU/HCU/BU (acronym) ; Chemical Engineering Dept.
Name of Presenter Azizul bin Buang 14
LEADING AND LAGGING INDICATORS

Leading indicator identifies failings or ‘holes’ in vital aspects

of risk control system discovered during routine checks on the
operation of a critical activity within the risk control system.

Lagging indicator reveals failings or ‘holes’ in that barrier

discovered following an incident or adverse event.
- incident does not necessarily have to result in injury or
environmental damage: can be a near miss, precursor event
or undesired outcome attributable to a failing in that risk
control system
Presentation Title (acronym) ; Performance Indicator & Compliance Audit
Division – Name/OPU/HCU/BU (acronym) ; Chemical Engineering Dept.
Name of Presenter Azizul bin Buang 15
 eactive & Proactive Measures

Analysis of many Identify those

Local &
incidents can conditions most
Organizational reveal recurrent needing correction,
patterns of cause leading to steady
Conditions
and effect. gains in resistance
of fitness.

(Reason, 1997)
 eactive & Proactive Measures

Each event shows Regular checks

Defences, reveal where holes
a partial or
Barriers & complete trajectory exist now and
through the where they are
Safeguards most likely to
defences.
appear next.

(Reason, 1997)
Lead: To guide, go in front
eading Indicator
1) A measure of conditions or activities that are
believed to precede, and consequently affect,
injury rates. (OHSCO)

2) A metric used for its ability to measure

incremental progress, or quality, or to indicate
the direction of future results (predictive). (Dupont, 2000)
nputs/Outcomes
Inputs
(leading indicators)

Outcomes
(lagging indicators)
LEADING INDICATORS

Definition:

An indicator that predicts future events and tend to change

ahead of that event. Sometimes used as a predictor.
A measure preceding or indicating a future event used to
drive and measure activities carried out to prevent and
control injury.

Focused on future safety performance and continuous

improvement - proactive in nature and report what employees
are doing on a regular basis to prevent injuries.

Leading indicators: outcome of pro-active monitoring -

evaluates present state of facility through routine and
systematic inspection and testing of work system
 Performance DRIVER

• provide early warning of possible incident occurring

• measure effectiveness of controls and provide assurance that
systems designed to control risks are operating as intended
LEADING • proactive measure of performance of key process or system

INDICATORS Leading indicators considered "drivers" of lagging

indicators
• improved performance in leading indicator will drive better
performance in lagging indicator

When measured and monitored effectively,

leading indicators provide data to enable
effective intervention

Presentation Title (acronym) ; Performance Indicator & Compliance Audit

Division – Name/OPU/HCU/BU (acronym) ; Chemical Engineering Dept.
Name of Presenter Azizul bin Buang 21
 ehaviour-directed Indicators
Frequency and Quality of:
Workplace safety and loss control inspections
Job safety observations
Employee safety training
Safety program audits
Employee safety meetings
Safety communications to employees

(Prieskop & Woessner, 1997)

 ehaviour-directed Indicators
Frequency and Quality of:
Safety performance appraisals
Employee safety suggestions
Personal protection equipment inspections and
observations
Safety committee meetings
Employee involvement in program
implementation
(Prieskop & Woessner, 1997)
ehaviour-directed Indicators

Timeliness of required responses

to employee safety suggestions

Timeliness and quality of

accident/incident investigations

(Prieskop and Woessner, 1997)

 Definition: An indicator that follows an event.
Lagging indicators: traditional safety
metrics used to indicate progress toward
compliance with safety rules.
LAGGING These are the bottom-line numbers that
INDICATORS evaluate the overall effectiveness of safety
at your facility. Informed how many people
got hurt and how badly.
Lagging indicators, it says, are generated
by a process of reactive monitoring -
keeping track of undesired events, such as
gas releases
LAGGING INDICATORS

OUTCOME measure
• measure and learn from incidents that have occurred
• reactive measure of some aspect that has failed
• (at least) a layer of protection of process safety system has actually
failed

However minor, important to be investigated and recorded

• trends recorded; indication of larger systemic failure

Indicators show when desired safety outcome has failed, or

not been achieved
esults-directed Indicators
Loss Number of lost time
time cases x 200,000/number
case of hours worked
rate
Number of days lost and
Loss and restricted x 200,000
restricted hours/number of hours worked
day rate
LEADING AND LAGGING INDICATORS
Leading Indicators
Lagging Indicators • Information that drives or can be
Historical information that measures correlated with future performance
past performance No. of Near Misses
Select the lowest detectable event % of backlog of MoC documents
(breach of process control envelope) (not closed)
e.g.: No. of requests made to bypass
Overfilling critical interlocks
Overpressure No. of Alarm Activation (near
design envelope)
Over temp
No. of Interlock Sequence
Low flow
Activation (design envelope
Excessive corrosion protection)
EXAMPLES OF MEASUREMENT INDICATORS
 agging/Leading Indicators

In recent years there has been a

movement away from safety measures
purely based on retrospective data, or
‘lagging indicators’ such as fatalities,
lost time accident rates and incidents,
towards so called ‘leading indicators’
such as safety audits or
measurements of safety climate.
(Flin et al, 2000)
LEADING VS LAGGING INDICATORS

• Lagging indicators provide important data about process safety failures

but allow for changes only after something has gone wrong

• Emphasizing leading indicators can have a more preventative impact by

identifying safety system deficiencies before potentially serious
outcomes occur
 Injury bases number goals = accepting injuries/
illnesses
“After the Fact”, person is already injured
Focuses management on the wrong data
MEASUREMENT What have you proactively done for prevention ?

LAGGING No insight on working safely, “injury drivers” not

INDICATOR identified
PROBLEMS Not precise, data manipulation, no insight on
preventative actions
Injuries are never eliminated
Fact: “Leading indicators” drive “lagging”
PROCESS SAFETY MANAGEMENT STRUCTURE

Employee Involvement
Process Safety Information
Process Hazard Analysis
Operating Procedures
Employee Training
Contractors
Pre-Startup Safety
Mechanical Integrity
Compliance
Hot Work Permits Audits!
Management of Change
Incident Investigation
Emergency Preparedness
 This element is critical in
assessing the effectiveness
of the PSM system. It should
COMPLIANCE
identify weaknesses in the
AUDITS
design or implementation,
and use this information to
correct them.

Presentation Title (acronym) ; Performance Indicator & Compliance Audit

Division – Name/OPU/HCU/BU (acronym) ; Chemical Engineering Dept.
Name of Presenter Azizul bin Buang 34
COMPLIANCE AUDITS

The purpose of the audit element is to ensure that the PSM

program is operating in an integrated and effective manner.
AUDIT

• Arrangements to conduct periodic audits are to be established in

order to determine whether the Process Safety Management
system and its elements are in place, adequate, and
effective in preventing incidents.

• An audit policy and program should be developed, which includes

a designation of auditor competency, the audit scope, the
frequency of audits, audit methodology and reporting.

• The audit includes an evaluation of the organization's PSM

management system elements or a subset of these, as
appropriate.
 The audit conclusion should determine whether the
implemented OSH management system elements or a
subset of these:
– are effective in meeting the organization's PSM
objectives
AUDIT – are effective in promoting full worker participation
– respond to the results of PSM performance evaluation
and previous audits
– enable the organization to achieve compliance with
relevant national laws and regulations
– fulfill the goals of continual improvement and best PSM
practice.
 “Certify” compliance every three years
procedures are adequate
are being followed
Conducted by at least one person
familiar with process
Report of audit findings
PSM AUDIT Document appropriate response to each
REQUIREMENTS findings
Document when deficiencies have been
corrected
Retain last two audit reports
PSM Audit is part of Checking and
Corrective Action
Goal needs to be Continuous
Improvement
 Explanation of Levels of Process Safety Management
(PSM) Compliance Status (as shown on the following
form)
None: Little or no information is available to determine
compliance to the proposed OSHA PSM rule; a lack of
information or inability to easily provide information
SAMPLE would constitute little proof of compliance.
PSM AUDIT Partial: Significant information is available, but not
enough to determine compliance with the proposed
REPORT OSHA PSM rule; incomplete documentation (process
FORM descriptions, P&IDs, written procedures, etc.) would
constitute partial compliance. Lack of formal methods
(verbal only) of handling changes to process
information would also constitute partial compliance.
Complete: The available information is sufficient to
verify compliance to the proposed OSHA PSM rule.
Personnel responsibilities are clearly established and
the documentation is complete and easily accessible.
SAMPLE PSM AUDIT REPORT FORM:
PSI
SAMPLE PSM AUDIT REPORT FORM: PHA
FREQUENCY

How often audits are conducted will depend on several factors:

• Process inherent risk

• Phase process life cycle
• Past experience
• Maturity of the PSM system
• Maturity of organizational culture
• Facility, corporate, or regulatory requirements

Regardless, some audits should be conducted on a regularly scheduled

basis
 Team based activity
requires access to operators and experts
team should be lead by competent personnel

Element by element (typically)

WHO & Directed primarily by documented protocols

HOW?
Physical Scope
SCOPE
– What element or units are being audited?
Analytical Scope
– What are the auditing criteria?
Temporal Scope
– What time period are you auditing? E.g. April 1,
2013 - March 30, 2013
Design of a PSM Audit
Start with OSHA Guidance – Includes
Document • Program Summaries by section
• Record Review Guidelines
OSHA Instruction/ Compliance • On-site Conditions to Review
(CPL) directives CPL 2-2.45A CH- • Interview Questions
1 - Appendix A
Design of a PSM Audit
CPL 2-2.45A CH-1 - Appendix A Audit Guideline Documentation.

As noted at P.2. of the body of this instruction, the

Audit Guidelines are constructed as a series of
PSM AUDIT GUIDELINES questions relating to each of the pertinent provisions of
the standard.
Purpose.
1. The questions are designed to elicit a determination
of "Yes" or "No" by the CSHO as to whether compliance
This appendix contains audit guidelines with the provision has been met. This shall be indicated
intended to assist the CSHO in in the column labeled Met Y/N. A "Y" or "Yes" in this
investigating an employer's compliance column indicates the subsection meets requirements.
with the PSM standard. It shall be used An "N" or "No" indicates the employer does not meet
in conjunction with Appendix B, the standard and an "NA" signifies that the subsection
does not apply.
Clarifications and Interpretations of the
PSM Standard, as the primary source 2. A determination of "No" for any provision indicates
of compliance guidance on 29 CFR noncompliance; thus, any "No" shall normally
1910.119. result in a citation for a violation of that
provision.

3. The CSHO shall thoroughly document each such

determination in the case file.
DESIGN OF A PSM AUDIT
• Develop Implementation Criteria

Level 5-
Addressed in
Level 4- Criteria particularly
has been effective
effectively and manner; best
Level 3- Most consistently
elements management
implemented practices in
addressed; some
areas need industry or
Level 2- completion, company.
Addressed in documentation or
cursory or ad communication
hoc manner,
Level 1- little
Issue or coordination or
criteria has management
not been
addressed
EXAMPLE QUESTION & IMPLEMENTATION LEVELS
Q: Have appropriate checks and inspections been made to assure equipment is installed
properly and consistent with design specifications and manufacturer's instructions?

• There is no evidence of a process for installation verification.

Level 1

• Some staff report that inspections are done, but there is no consistent
Level 2 documentation or process.

• There is evidence of a procedure for equipment installation checks and inspections,

based on review of documentation. Not all new equipment is consistently reviewed;
Level 3 or, reviews may not be complete.

• There is an effective and consistent review process which verifies that new
equipment is installed properly and in accordance with specifications. Reviews are
Level 4 documented.

• The process for new equipment installation has been designed and implemented in
a particularly effective manner and represents best practices for this industry or
Level 5 organization.
DESIGN OF A PSM AUDIT
EXAMPLE OF AUDIT SYSTEM

Screenshot of EHS Management Partners, Inc.

Compliance Audit System
(Einolf & Menghini, 1999)
Design of a PSM Audit
Example of Audit system

Presentation Title (acronym) ; Performance Indicator & Compliance Audit

Division – Name/OPU/HCU/BU (acronym) ; Chemical Engineering Dept.
Name of Presenter Azizul bin Buang 49
DESIGN OF A PSM AUDIT
EXAMPLE OF AUDIT SYSTEM
Design of a PSM Audit
Example of Audit system
Design of a PSM Audit
Example of Audit system – Typical Report
Design of a PSM Audit
Example of Audit system
DESIGN OF A PSM AUDIT
– Audits should be conducted by competent persons
internal or external to the organization who are
independent of the activity being audited.

– The audit results and audit conclusions should be

communicated to those responsible for corrective
action.

– Consultation on selection of the auditor and all stages of

the workplace audit, including analysis of results, are subject
to worker participation, as appropriate.
 STEPS TO
CONDUCT A
COMPLIANCE
AUDIT

Presentation Title (acronym) ; Performance Indicator & Compliance Audit

Division – Name/OPU/HCU/BU (acronym) ; Chemical Engineering Dept.
Name of Presenter Azizul bin Buang 55
1. Assemble an audit team
First step - designate an audit team: assembled from individuals that are
Familiar with the process to be audited
Experienced in PSM

Team composition:
Team leader – Independent
Subject matter experts (SMEs) - needed on an ad hoc basis for covering such
topics as chemistry, maintenance, operations, and safety critical systems
Area supervisor of the area being audited
Lead operator of the area being audited familiar with the details of the
hour-to-hour, day-to-day
operation of the facility

knowledgeable of what things

are done, how they are done,
and why they are done the way
they are.
2. Determine the audit timing and scope
• Audit team leader and facility (to be audited) to agree on the timing
of the audit and scope of the audit.
• The timing has to fit within the activities planned at the plant, such
as turnarounds and startups.
• The facility needs to agree with the scope in order to prepare for the
audit and in order to suggest areas that may need to be audited.

Appendix C to §1910.119 -- Compliance can be used as a

Guidelines and Recommendations for reference for
Process Safety Management (Nonmandatory) preparing PSM audits.
2. Determine the audit timing and scope
Scope should be based around the 14 elements of OSHA’s Process Safety
Management regulations

1. Employee Participation
8. Mechanical Integrity
2. Process Safety Information
9. Hot work permit
3. Process Hazard Analyses
10. Management of Change
4. Operating Procedures
11. Incident Investigation
5. Training
12. Emergency Response
6. Contractors
13. Compliance auditing
7. Safe work procedures
14. Trade Secrets
3. WRITTEN AUDIT PROTOCOL

Document that asks

questions to determine:
a robust PSM system is in
place
the PSM process is
effective in meeting the
written requirements of
the system
4. PRE-AUDIT INFORMATION REQUIRED
The facility to be audited should gather the
process safety information that will be required
for the audit

1. Description of processes (PFDs)

2. Process Controls (P&IDs)
3. Organizational structure
4. PSM program description
5. Past audit reports & resolution of recommendations
6. Summary of local regulations
5. PLAN ONSITE ACTIVITIES

Establish a detailed agenda for the onsite portion of the

audit – i.e. activities (interview, walkabout observation
etc.) & personnel involved (both from site and audit team
member)
Allow the site being audited to schedule their personnel
to meet both their production requirements and the audit
team’s needs.
6. Kick-off Meeting & Conduct of Audit

Conduct a kick-off meeting

prior to the start of the audit.
This meeting should include
facility management and
facility staff responsible for
process safety.

Opportunity to confirm the overall site schedule, discuss the

mechanics of the audit, and answer any questions that the facility
staff may have about the audit
6. Conducting the Audit
•Employee participation
•Process Safety Info
•PHAs
Record reviews •Operating Procedures
•Training
•Mechanical Integrity
•Compliance auditing

•Contractors
Direct
•Safe work procedures
observations
•Hot work permit

•Management of Change
Interviews •Incident investigations
•Emergency response plan
 Element 14
Trade Secrets
Issue on withhold of
information

14. Trade secrets

Process Safety Information
Process Hazard Analysis
Operating Procedures
Incident Investigations
Emergency Response
Compliance Audits

Information necessary for the above PSM

activities cannot be withheld on the basis of
it being a “trade secret”.
6. Conducting the Audit
Immediately inform facility
management of imminent
hazards

Daily share
preliminary
findings and
observations

Focus on the agreed written protocol

 6. Close-out Meeting
• Conduct a close-out meeting where all
findings and observations are
discussed.

• A draft audit report, even if only verbal,

should be given to the facility during the
close-out meeting.
7. Document the audit

Draft report

Feedback – provision for facility to

respond to correct any factual errors
in draft report

Final report
8. Address audit findings 9. Monitor completion of
and recommendations audit recommendations

Final Audit
Report
IMPLEMENTING AUDIT FINDINGS
Audits are not useful on their own

Findings must be used to improve PSM

Adopt as proposed

Adopt in principle (the recommendation will be implemented in an

equivalent manner)

Reject based on the assertion that the recommendation was made in

error (Because of an error in facts or in judgement)

Reject due to a change which has rendered the recommendation

inapplicable.
MONITOR PSM
MATURATION OVER
TIME FOR EACH
FACILITY

Basis of retaining the

past two audit
documents:
improvements from
one audit cycle to the
next can be compared.
The PSM system
should be improving
and becoming more
robust with each audit.
 Purpose of safety audits is to determine:
the status and effectiveness of safety management
efforts versus goals
the progress toward those goals

All elements of the PSM program must be evaluated

for compliance with the PSM Rule every 3 years.
SUMMARY
Reports of internal audit findings must be written,
and responses to the findings must be documented
and certify that the deficiencies have been corrected.
The responses should be action plans indicating
what corrective actions or additional investigations
will be done and when they will be completed.