Between the cost of trying to manage regulatory compliance and the cost of failing to manage it, U.S. companies spend more than $1 trillion annually on administration, risk assessment, training, litigation and fines, according to estimates by the U.S. Office of Management and Budget.
With every new federal, state, local and industry mandate — and each workplace accident — CEOs and HR managers wince and reach for the aspirin bottle. But Nick Zingale sees it as another opportunity to provide immediate regulatory relief.
As founder and president of Affinity Consultants Inc. in Canal Fulton, Zingale is much in demand these days. That’s because the enormous expense related to environmental, health and safety (EHS) issues has companies scrambling to do more than merely comply with regulatory mandates.
“When companies begin to assess the true costs of what workplace injury costs them, it becomes crucial to maximize the value of their EHS programs,” says Zingale.
For example, when a worker sustains a lower back injury on the job, there are associated health care costs, operating costs due to down time, workers’ compensation assessments, increased insurance premiums and administrative expenses. Add it all up and the average back injury can cost a company about $100,000.
Contending that the greatest cost of compliance management isn’t compliance itself, but rather the direct and indirect expenses of injuries, Affinity helps companies create and implement proactive EHS programs that are based on a company’s specific mission, corporate culture, current initiatives and overall goals.
“We look at a company’s mission statement to see how they address environmental and safety issues, and we consider what they’re currently doing in that regard,” he says.
Next, a gap analysis helps determine new processes to be implemented.
“In such an analysis, the company must consider, ‘Here’s what we’re doing today, and here’s what we should be doing,'” Zingale says. “The strategy shouldn’t be simply to ensure compliance, but to move forward new processes built upon the initially defined strategy.”
Corporate culture also figures into the equation. For example, HR might post a compliance calendar in the lunchroom to publicize current EHS initiatives to workers. But if the operations manager saunters around the plant without his safety glasses, his management style hinders the overall EHS strategy.
Zingale says an effective EHS program requires “innovative thinking, strategic planning and sustainable solution development.” With that in mind, a company must consider what it can realistically accomplish.
“By implementing sustainable management processes, educational initiatives, technological innovations and other solutions, a company can not only solve its EHS problems proactively, it can create a cultural initiative in which people see an immediate payback,” Zingale says.
For example, since Will-Burt Co. in Orrville implemented the EHS program Affinity helped develop in 1998, it has achieved a reduction of more than 50 percent in workplace injury and associated injury costs. This resulted in estimated annual savings of $150,000 and a marked value enhancement in terms of increased workplace morale and productivity.
“An EHS program doesn’t have to be a headache,” Zingale says. “The key is to establish an ongoing strategy that meshes with your company’s personality and realistically sustainable goals.” How to reach: Affinity Consultants, (330) 854-9066 www.affinityconsultants.com
Victoria Reynolds is a contributing editor to SBN Magazine.