The Technologizing of EH&S
Keep in mind that the limited resources available from IT will be a key factor in the viability of many software solutions.
- By Ben Archibald
- Jan 04, 2008
Increasingly, health & safety professionals
find themselves the dubious
owners of a variety of software tools and
large-scale software systems. These tools
and systems serve a variety of purposes,
from assessment to measurement, to data
management and analysis, to large-scale
EH&S program automation and administration.
For many, this “technologizing” of
EH&S means an additional set of responsibilities
and the development of a new set of
competencies. Even though these tools and
systems can provide substantial benefits,
prioritizing and deploying them so they
create the intended value for the enterprise
can be daunting.
During the past 10 years, virtually
every company has purchased software
that didn’t fulfill the value it promised.
According to the Standish Group, 35 percent
of software projects started in 2006
were outright successes and 19 percent
were outright failures. Forty-six percent
of software projects are considered “challenged,”
meaning they are significantly
over budget or fail to meet the needs of
users (Standish Group, Chaos Report,
2006). These are intimidating statistics
for organizations looking to increase
their reliance on software. While most
companies chalk this up to “living and
learning,” they want to minimize the
future likelihood of championing a failed
software rollout or investing in a regrettable
capital expenditure.
The good news is that companies are
improving their ability to achieve success
and create value with software projects;
companies have steadily improved their
success rates with software projects since
the Standish Group began its measurements
in 1996. This article sets out to
describe important trends and learnings of
those 10 years and to relate those trends
and learnings specifically to EH&S.
Four Hurdles to Overcome in Selecting the Right Software
Many solutions from software providers
serving the EH&S industry are effective at
creating value. Indeed, software companies
(and other service providers) are an important
source of innovation, helping to
increase the value brought by the EH&S
function. The challenge for an EH&S
organization is to match the available solutions
with its business.
Invariably, EH&S organizations are
not faced with the same problems and
challenges across—and even within—
industries. Additionally, organizations
invariably have important contextual factors—
management support, budgets,
industry regulations, and compliance
concerns, to name just a few—that make
solution selection a challenging proposition.
To avoid selecting software that is a
bad fit for solving your challenges, consider
the following:
1. Avoid solution-driven objectives.
Managers purchasing software would like
to think they make software purchases for
their organizations rationally, through a
nearly deductive process that leads them
from their problems, challenges, and
opportunities to the feature set of the software
package they ultimately select. A simplified
version of this process might look
like this:
• Identify key EH&S business challenges
and objectives.
• Identify the means and methods
for meeting business objectives and
tackling challenges.
• Create a business case quantifying
the cost/benefit of meeting business
objectives.
• Establish a budget.
• Identify the best software solutions
to enable meeting the business objectives
within the established budget.
• Select the software solution.
In this example, the selection of software
depends upon knowing your business
objectives and then matching them
well with the capabilities of a software
solution. Unfortunately, the “I need one
of those” factor can overwhelm the otherwise
rational selection process when an
organization is not disciplined about
understanding its unique challenges and
objectives. An extreme example might
look like this:
• Encounter a software product or
solution.
• Identify ways in which the software
will create value in the organization.
• Define the objectives of the business
based on what the software can do.
• Create a business case that defends
the value created by the features of the
software.
• Establish budget for the software.
• Purchase the software.
I call the results of this latter example a
“solution-driven objective” because the
business objectives that justify the purchase
decision are a reflection of the feature
set and capabilities of a would-be software
solution. Rather than asking, “What
do I want my software to do for me?”—a
high bar for a software solution—in this
latter process, a company finds itself
jumping over a substantially lower bar by
asking, “Do I want to do the things that
the software does?”
The trap of the solution-driven
problem is not that EH&S organizations
might select bad software. Selection
processes that produce “solution-driven
problems” may result in the selection of the
wrong software—software that does not
address priority business challenges.
2. Understand what you can and can’t
expect from your IT organization. EH&S
organizations can expect varying levels of
involvement from IT in the purchase and
ongoing support of software. Regardless of
the scale or the level of technology adoption
in an organization, IT resources are
limited and are likely to be prioritized to
projects in core business infrastructure
(e.g., desktop, network, e-mail, etc.), sales,
marketing, and finance before they are
allocated to EH&S. The limited resources
available from IT will be a key factor in the
viability of many software solutions.
3. Know your total cost of ownership/
operation. Total Cost of Ownership (TCO)
is a term coined by the Gartner Group in
1987. While several methods exist for calculating
TCO, they all involve creating a
solid sense of what it will really cost to use
hardware or software after accounting for a
broad set of factors. Since 1987, the term
has evolved in many spheres to “Total Cost
of Operation” because a) software isn’t
really “owned,” it is licensed and b) many
analysts were dissatisfied that the early
Gartner TCO reports did not include the
economic return (e.g., ROI, IRR, EVA,
etc.) created by the software purchase.
Regardless of which term you prefer, an
EH&S organization must understand the
real costs of using a software solution
because these costs will be a critical factor in
the value a software solution creates.
Licensing costs are obvious, but considerations
should be made for training, maintenance,
support, upgrades, and change
management, as well.
4. Understand the role of scale. For
many EH&S organizations, scale is an
important facet; for others, scale is the
challenge.
For example, my company is currently
developing software designed to address
some of the challenges faced by organizations
whose large variety of jobs and job
risks challenges their industrial hygiene
and injury prevention specialists. In these
organizations, the inability to easily understand,
quantify, and explain jobs and job
risks leads to inflated worker’s compensation
costs. A pilot customer for this software
has thousands of jobs and tens of
thousands of factors contributing to injury.
Given the principles noted earlier, we
work to ensure the challenges and objectives
drive the capabilities of the software.
Management of the volume of jobs and job
risks is a key design factor for our team
because the volume of jobs is the fundamental
business challenge.
While the software will perform many
functions and solve many challenges
common to virtually all EH&S organizations
(knowing your risks for injuries,
knowing the demands of your jobs, etc.), if
you remove the factor of scale from a customer’s
challenges, this particular solution
will, quite bluntly (and at risk of a scolding
from my colleagues in sales and marketing),
not create sufficient value to justify
the license costs.
Of course, there are myriad other hurdles
to account for when selecting EH&S
software solutions. These four hurdles,
however, are often ignored, frequently
leading to budget overruns and failed
implementations. All of them deserve
greater attention.
An Exciting Future!
The software landscape at large—within
EH&S and elsewhere—has been going
through a rapid and exciting evolution.
The most notable trend in software is
the continuing emergence of Software as a
Service (SaaS). EH&S isn’t the only
department that has been unable to fully
leverage software because of IT organization
resource constraints. The software
marketplace has responded by creating
solutions that greatly reduce the need to
access internal IT resources. Numerous
software applications available today were
specifically designed to be delivered inclusive
of the use license, hardware/software
infrastructure, and strategic and technical
management services. The Internet has
enabled this new set of possibilities.
SaaS emerged in 2000 and 2001 as an
evolution of the Application Service
Provider (ASP) model of the 1990s. Salesforce.
com is a pioneer of the SaaS wave as
the provider of a market-leading Customer
Relationship Management (CRM) solution.
WorkDay is leading the innovation of
SaaS for “Enterprise Business Services”
(which many of us understand to be synonymous
with HR systems).
SaaS is especially exciting for EH&S.
Where Salesforce.com and WorkDay are
creating a revolution by providing functionality
comparable to existing enterprise
applications at a fraction of the costs
because of the removal of IT management
expenses, EH&S will benefit from the SaaS
trend by gaining access to an emerging
generation of software applications that
simply never could have been implemented
in the traditional, internally managed
model because of EH&S’s position on the
IT priority scale.
Conclusion
I’ve been in the unique position of
watching the software developed by my
team be part of—and, in many cases, the
inspiration for—radical improvements in
EH&S operations around injury prevention.
Through this experience, I have
observed that the innovative customers
we are fortunate enough to work with
have one thing in common: They know
their business and are willing to innovate
to solve their challenges and create
opportunities. When you think about
creating innovations for your own organization,
remember:
1. Avoid solution-driven objectives
2. Understand what you can and can’t
expect from your IT organization
3. Know your total cost of ownership/
operation
4. Understand the role of scale
There are exciting trends in the
making, and the “technologizing” of
EH&S brings great opportunities for
innovation!
This article originally appeared in the January 2008 issue of Occupational Health & Safety.