Loss Prevention Principles Across the Carrier
/Introduction - Loss Prevention
Welcome to article nine of ten in this series on trucking company safety systems. Previous articles have focused primarily on examining parts of a carrier’s safety system and repurposing tools of compliance to better serve their organisation. In this article, I will get into the subject of loss prevention.
My goal in doing this is to explain how loss prevention principles can be applied to aspects of a carrier outside of roles directly related to safety and compliance. Once the benefits of adopting a loss prevention mindset can be seen in all parts of the company, it is easier to see how health, safety, and compliance can be fully integrated into a carrier’s operations.
In the world of safety, loss prevention is the practice of using systems and measures to reduce and prevent the loss of life, health, and property from incidents and accidents [1]. I’ll expand on this definition by including loss of reputation; incidents that do not result in any health, life, or property loss can still cause damage to a business through negative impacts to the business’s reputation. Just think about a social media video depicting a commercial truck with a highly visible company logo driving improperly in a public place without any incident - in such a case, the carrier’s reputation takes the hit, not the bumper.
When it comes to loss prevention and, in general, modern occupational health and safety, Frank E. Bird is considered one of the most influential figures to have contributed to the profession [2]. Many safety professionals today are familiar with one of his greatest works, Practical Loss Control Leadership, and this textbook serves as the first place many people learn about risk matrices, incident investigation methodology, and other health and safety principles [3].
The reason why I am mentioning Bird’s Practical Loss Control Leadership is because of the way the text discusses safety as an organisational objective. There are certainly better texts that can provide carriers with specific guidance for safety-related tasks like collision investigation, but what I find so noteworthy about Practical Loss Control Leadership is that it is not overtly written for safety professionals but is, instead, written for all types of company leaders.
This is an important distinction between this text and newer ones. Nowadays, the safety program at a company is often under the leadership of a safety professional and may be somewhat siloed from the rest of the organisation. I recommend anyone in a position of leadership read Practical Loss Control Leadership because it frames safety and loss prevention principles as areas of knowledge that can benefit all leaders, not as specialised knowledge that only belongs to the safety director.
In the following sections, I will describe how loss prevention and safety principles can be applied to other personnel divisions within a carrier (like operations and management). The purpose of doing so is to show that these different parts of an organisation can work together and operate on similar principles: principles that will not only protect the health and safety of workers and other road users but principles that will protect the carrier from loss in all of its unwanted forms.
Iteration and Loss Prevention
According to The Association of Qualitative Research, an iterative approach is one where the “content of the discussion, stimulus, or sometimes even the methodology is adapted over the course of the research programme” [4]. This means that, as a research program runs its course, the way in which the research is conducted may change based upon feedback from the early trials in the program. Simply put, an iterative approach is one in which the process may change over the course of its operations based upon feedback from earlier experiences.
Safety systems should operate in an iterative manner. An iterative approach to a system means that the content, purpose, and/or objectives of the system may change and adapt as the system goes about its regular functions based upon learnings from previous incidents. As a trucking company experiences loss in the form of collisions, tickets, inspection violations, and breakdowns, these experiences should be used by the system to adjust the system for improved future operations.
Incident investigations are an example of iteration within a safety system. When an incident occurs, an investigation is done to uncover root causes to prevent future occurrences. By learning from the investigation’s findings, the safety system changes to better suit the carrier.
An iterative systems approach coupled with loss prevention principles like hazard identification and risk assessment provides a framework for organisations to reduce undesirable loss. There is no reason why this framework need only apply to the safety and compliance part of the company. Let’s see how it can be of benefit to the operational side of a carrier.
Operations
In a trucking company, “operations” is the broad term that is used to describe the personnel and systems at the company that are responsible for carrying out its profit-making duties. Operational staff find loads, organise trucks and drivers, communicate with customers, and are generally the ones in the company that conduct the work that the carrier exists to conduct.
Operational staff include dispatchers, drivers, salespeople, load planners, and the administrative people who facilitate the duties of these positions. Senior management, safety, and maintenance are not considered parts of operations, at least in a logistical sense.
Sometimes, operations and other parts of a carrier are seen as being at odds. Safety and maintenance may see operations as putting profit above equipment and lives; operations may view safety and maintenance as, at times, unnecessarily slowing down the important work of the carrier. It is the job of senior management to create a culture of collaboration and understanding between these different parts of the carrier.
Operational staff will understand, though, that any form of loss the carrier experiences will negatively impact profitability. At some carriers, commissions may be at stake when things go wrong. Operations should not rely on safety personnel to reduce loss; instead, operations can do the following:
Define loss.
Ensure the system used to direct operations is iterative.
Loss in the context of operations should be fairly easy to define. It includes anything that prevents the carrier from meeting customer commitments and anything that negatively impacts customer relationships.
Implementing an iterative approach to operational systems is trickier and means that operations need to establish a mechanism to learn from past failures. One of the simplest ways to do this is to conduct basic investigations of incidents that result in an operational loss.
For example, perhaps one day a customer calls the carrier to angrily report undesirable behaviour of one of the carrier’s drivers. This is an example of an incident that can result in an operational loss since it could damage the carrier’s reputation and jeopardize future work from this customer.
Once the above complaint has been lodged, the carrier should consider this to be an operational incident and investigate what happened. Despite the saying “the customer is always right”, the carrier should not jump to conclusions and should give their driver the benefit of the doubt. Simply taking the word of the customer as fact and immediately disciplining the driver could result in the driver growing disillusioned with the carrier and lead to them seeking work elsewhere. The loss of an available driver reduces the capacity of the carrier to meet customer demands and represents another potential operational loss.
By using a calm and rational mindset to carefully evaluate all sides of the story, the carrier may gain insight into this particular customer and driver. Perhaps a simple misunderstanding took place, or perhaps there are cultural reasons why the incident occurred. Once the carrier’s investigation has uncovered these factors, the carrier has the opportunity to improve future operations.
Summary
While this article may appear to be aimed at larger carriers, any size of organisation can adopt an iterative approach to systems and principles of loss prevention. All this means is to 1) have a frame of mind that is open to change and 2) have a clear and comprehensive idea of what constitutes a loss. These are ideas that can be built into the systems and organisation chart of a large carrier or can become professional practices of a manager at a small company who is involved in all aspects of the carrier operations and administration.
In the next and final article in this series, I will be looking at the role of the external compliance auditor in greater detail. Some safety professionals and carrier managers secretly and simultaneously hold the external compliance auditor in a complicated position of esteem, mystique, and contempt. I will work to shed some light on the role of this individual.
References
1 - “Loss Prevention”, safeopedia, accessed September 26th, 2021, https://www.safeopedia.com/definition/410/loss-prevention-health-safety-and-environment
2 - “A Tribute to Frank E. Bird Jr. (1921-2007)”, ISRS Overview, DNV, accessed September 26th, 2021, https://www.dnv.com/oilgas/international-sustainability-rating-system-isrs/tribute-to-frank-bird.html
3 - Bird, Jr., F.E., Germain, G.L., and Clark, M.D. “Loss Causation Model”, In Practical Loss Control Leadership, Third Edition. DNV GL Business Assurance USA, Inc., 2014.
4 - “Iterative approach”, The Association for Qualitative Research, accessed September 26th, 2021,https://www.aqr.org.uk/glossary/iterative-approach