measuring the effects of strategic change on safety in a ... · measuring the effects of strategic...

Measuring the Effects of

Strategic Change on Safety in a

High Reliability Organization

Eric Arne Lofquist, PhD

Sikkerhetsforums årskonferanse

Stavanger

9 June 2009

Take-Off 05 project (2003-2005)

• New Public Management initiative in civil

aviation called “Corporatization”

• Deliberate large-scale organizational change in

a High Reliability Organization (HRO)

– Reorganization/downsizing

– New management systems/new technology

• “With no reduction in safety or service to

customers”

Agenda

• Personal background

• Review of the relevant safety literature

• High Reliability Organizations

• Avinor study

– Purpose

– Research design/methodology/data sources

– Organization of thesis

– Findings and implications for oil sector

Eric Arne Lofquist

Associate Professor at BI Bergen

Master of Management in HRM and HMS www.bi.no/hms

Commander, US Navy (28-years)– 15 years flying F-14 ”Tomcat” from US Navy Aircraft Carriers

– 13 years as a top leader and senior strategic planning officer • Norwegian Airforce Staff (Stavanger) 1989-1992

• CEO of US Navy industrial complex (New Orleans) 1992-1996

• NATO Headquarters (Brussels) 1996-2000

Relevant operational experience for study:– 15-years operative flight experience

•Operations/training/maintenance/safety

– Top leader experience responsible for organizational change•United States Navy/NATO

•Powersim/Nutec Crisis Management

Academic Background

• BS – Business Administration (Jacksonville University, 1976)

• MA – National Security Policy and Strategy (US Naval War College, 1985)

• MA – International Relations (Salve Reginia Universtiy, 1986)

• MBA – International Business (University of New Orleans, 1996)

• PhD – Strategy and Management (Norges Handelshøyskole, 2008)

Specialist education

• US Navy Flight School (1976-1978)

• Industrial Aviation Safety Specialist (US Naval Post

Graduate School, Monterey, California - 1988)

– F-14 Crash site investigator/team leader (1988)

High Reliability Organizations

(HROs)

Theory and Practice

Safety Literature

• Most safety literature written by sociologists, psychologists and engineers with specific paradigms ”with roots in two dissimilar scientific mechanisms for understanding socio-technical systems” (Roberts, 2001)

– Engineering, risk analysis and statistical modeling

– Social science (Sociology and Psychology)

• Most of the literature focuses on specific parts of safety, such as: accident prevention (barriers), risk management, human causes (human error)

Safety Literature (2)

• Theoretical standards for safety are based on grounded theory from real disasters (Three Mile Island, Bhopal, Challenger , Piper Alpha, Űberlingen, Columbia)

• Early safety literature focuses on reducing human error and risk mitigation (pre-1980s)

• From the 1980s onward, social science interests took on an organizational or “systems perspective”

Organizational accidents

• 1978 Barry Turner - Man-made disasters– Impossible without organizations

– Incubation periods (environmental changes)

• 1984 Charles Perrow - Normal Accidents– Tight coupling within interactively-complex systems

– “Accidents” are normal but undesired system outcomes

• 1987 Gene Rocklin, Todd LaPorte and Karlene Roberts (University of California Berekley)– High Reliability Organizations

• 1990 James Reason – Organizational Accidents

– Swiss Cheese Model – realignment of barriers

– Latent conditions

Swiss Cheese Model – Reason (1990)

Organizational accidents (2)

• 1996 Diane Vaughan - Challenger Space Shuttle Accident

– Cultural deviance

• 2001 Karl Weick and Kathlene Sutcliffe – Managing the

Unexpected

– Mindfulness

• 2002 Hal Gehman – Columbia Space Shuttle Accident

– Resiliency of culture

Personal perspective on

safety/risk and HROs

• 1976 US Navy Flight School – first day

– ”Look at the person next to you ...”

• 1977 ”You boys know anything about a plane

crash?”

• 1979 First operational cruise on USS Nimitz – 14

crashes/14 pilots killed

• 25 May 1980 USS Nimitz crash

• This was the birthplace of HRO


• In 1984, a research group came together at the University of California - Berkeley to study organizations in which errors can have catastrophic consequences based on the question: – “If Accidents are “Normal” (Perrow, 1984), then why do some

industries operate with relatively few major disasters?”

– 3-year longitudinal case study – Electrical Grid, Air Traffic Control, and US Navy Aircraft Carrier Operations at sea

• In 1987, Gene Rocklin, Todd La Porte, and Karlene Roberts published “The Self-Designing High Reliability Organization: Aircraft Carrier Flight Operations at Sea” -Naval War College Review


• Industries that operate in inherently dangerous

environments with notably safe track records

• Conduct relatively error-free operations over long

periods of time

– Consistently make good decisions

– Learning environments/unlearning

– Sensemaking/mindfulness

USS Nimitz CVN-68

USS Nimitz Facts

(30-knot off-shore oil well)

• Length - 1092 ft (333 meters) – 3 Football fields

• Width – 252 ft (76.8 meters)

• Height – 244 ft (24 Story building)

• Speed - 30+ knots (56+ km/hr)

• 6000 personnel

• 90 aircraft/24-hour operations in all-weather

• 2 Nuclear reactors

• Fully functional airfield and Air Traffic Control facility

Key features of

Aircraft Carrier Operations

• Challenging and high risk environment

– Tight quarters (3 football fields/80+ aircraft)

– 8 types of Aircraft (jets, props, helos)

– Fuel (heat, gases, noise, etc.)

– Weapons (Bombs, missiles, bullets, etc.)

– Changing political/environmental factors

• Small operating margins

• Average age – 20-years old

• 33% of crew replaced each year (100% turnover every 3-years)

• Two operating structures

Study findings

• ”Reliable performance is as much a product of

history and continuity of operations as design”

• ”Complexity so broad that know one knows all of

the parts”

• Everything is broken down into homogeneous,

”task-oriented” units

• ”Integrated vertically and horizontally”

• Culture is the ”glue” that holds it together

Paradox of turnover

• Assumed that the continual introduction of new personnel erodes proficiency … but

• Efforts in training and responsibility transfer compensate for this deficiency – creates a ”learning environment”

• Leaders are pushed to establish authority and take responsibility early in process

• Institutionalization of continual, cyclic training as part of organizational and individual expectations

Paradox of turnover (2)

• Organization uses training and retraining as a means

of socialization and acculturalization

• One of the great enemies of high reliability is the

combination of stability, routinization and lack of

challenge and variety which leads to complacency,

carelessness and error

Other key findings

• Operational redundancy and slack – compensatefor social-technical interface deficiencies

– Take-offs and landings

• Local authority – task ownership

– Local action and reporting without fear (Just Culure)

• Regular turnover enhances cultural contributionsthrough the use of ”war stories”

• Questions are always being asked and leadersalways listening

Follow-on work

• Collective Mind (Weick and Roberts, 1993)

– Actors in the system construct their actions (contributions), understanding that the system consists of connected actions by themselves and others (representation), and interrelate their actions within the system (subordination). p. 357

• Mindfulness (Weick and Sutcliffe, 2001, 2006)

– Cognative processes within cultural settings

Double-loop learning

(Argyris & Schön, 1974)

Real world

Information

feedback

Mental models of

real world

Strategy, structure,

decision rules

Decisions

Single-

loop

Double-

loop

HRO today

• NASA – Columbia Space Shuttle Accident (Safety culture/climate surveys – proactive indicators)

• Nuclear power generation

• Transportation

– Civil Aviation

– Maritime

– Trains

• Health care (Primary and acute care, and managed care)

• Offshore oil production?

Five core values of HROs

• Sensitivity to operations

– Constant awareness of leadership and support staff of the

state of the system affecting performance

• Reluctance to simplify

• Preoccupation with failure

• Deference to expertise

• Resilience

– Change and response to external/internal environment

– Plan and implement improvement

initiatives

Measuring the Effects of Strategic

Change on Safety in a High

Reliability Organization

http://bora.nhh.no/bitstream/2330/1916/1/lofquist%20avh2008.pdf

http://bora.nhh.no/bitstream/2330/1916/1/lofquist avh2008.pdf

Purpose of the Avinor study


To study the effects of a deliberate strategic organizational change process on safety in a High Reliability Organization

To gain new knowledge in strategy development, planning, implementation, and consequences of change with particular focus on how change effects safety in an HRO

Provide expanded understanding of safety monitoring during a change process in a “proactive” vice “reactive” manner


Take-Off 05 project (2003-2005)

• Deliberate corporatization initiative that included:

– Complete reorganization (structure/leaders/HQ)

– Significant downsizing (700+ man-years)

– Introduction of new management systems (SMS)

– Introduction of new technology (NATCON)

• “With no reduction in safety or service to

customers”



3-year longitudinal case study focusing on

four latent constructs:

• The leadership’s role in the context of strategic

change in an HRO

• Organizational culture (how safety culture/climate

contribute to safety)

• Organizational change (matching change

implementation type with culture in place)

• Safety (classical measures vs. changes in individual

perceptions of safety over time)


Research Design


Literature review

Archival data search

–Internal publications/PowerPoint presentations

–Strategy, SMS, Take-Off 05 project, etc.

Three month orientation (HQ/site visits)

Leader group observations

Key informants

Semi-structured interviews (57)


Data collection


• Extensive primary and secondary data from numerous

sources both internal and external

– Observational data (field notes, meetings, presentations, telepone

conversations, etc.)

• Qualitative data

– Semi-structured interview data (57 one-hour interviews)

• Quantitative data

– 2x Internal Leadership Questionnaires

– SHT Safety Questionnaire data

• Secondary data – DNV report/Media articles/other studies


Data set



Integrated Safety Management System

(Lofquist, 2008)

Proactive

Phase

Interactive

Phase

Reactive

Phase

System Design System Operation System Outcomes

Time

Organizational Culture

Environment


3 internal cases - tower, approach and ATCC

services at three locations:

Oslo (Gardermoen/Røyken)

Stavanger

Bodø

4 embedded cases (Oslo, Stavanger, Bodø,

Trondheim ATCCs)


Research Design (2)



Conceptual causal model

Culture

+

+

+

+

+

Leadership

Change Safety

Hypothesized relationships


• 1) How does the interaction between leadership choices

and organizational culture type affect attitudes toward

deliberate strategic change in a high reliability

organization?

• 2) How do the relationships between leadership actions

during strategic change, safety climate in place, and

employee attitude toward change, affect safety as an

outcome variable?


Research questions


• Part 1 – Introduction

– Chapter 1 – Introduction and positioning

– Chapter 2 – Phenomenon

• Part 2 – Literature review

– Chapter 3 - Literature review

• Part 3 – Method

– Chapter 4 - Methodology

• Part 4 – Results

– Chapter 5 – Chronological events

– Chapter 6 – Mapping the effects of change

– Chapter 7 – Snapshot of safety

– Chapter 8 – Summary of empirical findings


Thesis outline


Thesis outline (2)

• Part 5 - Discussion and conclusions

– Chapter 9 – Discussion, recommendations, and future research

– Chapter 10 – References

– Chapter 11 - Attachments

Chapter 5

(Leadership choices leading to collapse)

• Chronological account of Take-Off 05 project

– Timeline (Jan 2000 – Jan 2006) - Need for change

– Detailed description of Take-Off 05 planning and implementation

processes

– Focuses on 2 key events (decisions) in 4 embedded cases -

processes leading to these decisions

– Internal and external reactions by key stakeholders

Study timeline

2001 20032002 20052004 2006

Chapter 5 - findings

• Participative process turns distinctively top-downleading to loss of consensus and trust, and leads to resistance and eventual failure of Take-Off 05 project

• Organizational mismatch between culture type and implementation method

• Demonstrated how incremental changes cansignificantly effect change implementation success

• Effects of external stakeholders

– Owners/Regulators/Government

– Public/Media

Chapter 6

(Mapping the effects of change)

• Mixed-methods approach for triangulating leadership

questionnaire data and semi-structured coded data

– Before the change process (2002)

– Turbulent 12-month period in (2005)

Across-case and within-case analyses of 4 embedded

cases (Bodø, Trondheim, Oslo, and Stavanger

ATCCs) experiencing 3 different phases of a

common change process

Trondheim

Oslo

Stavanger

Bodø

Oslo

Stavanger

Within-case analyses

2002/2004

Bodø

2002 2004

Bodø

Bodø

Stavanger

Oslo

Stavanger

Oslo

Across-case analyses

2004

Leadership group statistics – all units

Trondheim

2002

Bodø

2002

Oslo

2002

Stavanger

2002

Bodø

2004

Oslo

2004

Stavanger

2004

(V01) Leader

Motivates

5.00 5.00 3.67 3.97 3.30 6.02 5.57

(V07) Leader

Discussion

5.38 4.81 3.87 2.97 3.62 6.38 5.54

(V19) Leader

Distributes

information

5.21 4.64 3.98 3.53 3.71 6.28 5.69

(V25) Leader

unity/commitment

5.03 4.34 3.56 3.37 3.20 6.37 6.06

(V41) Trust in

Leader

6.20 5.84 4.26 4.37 4.17 6.64 6.46

(V73) Top Leader

performance

3.38 3.48 3.54 2.37 1.48 1.13 1.89

Local leadership quote

• “The leadership’s contribution to the local

working environment is not impressive … they say

things that demonstrate that we live in two

separate worlds in many respects. Many times I

have actually wondered if we work in the same

company. It might be that they have a special focus

on greater things but it is not good when it turns

into a war.” (Bodø 06)

Chapter 6 - findings

• Reactions are predictably different between cases in

all areas except questions pertaining to top leadership

• Effect of Leadership commitment to safety most

significant finding

Chapter 7

(A snapshot of safety)

• Snapshot of safety

• Test conceptual causal model using the 4 refined

latent constructs in a structural equation model using

a multivariate data analysis technique (Lisrel)

• Turbulent 12-month period (2005)

Refined conceptual causal model

Perception of

Safety

Culture

+

+

+

+

+

Perceptions of

Leadership

Commitment

Attitude toward

Change

Perception

of Safety

Hypothesized relationships

Safety Measurement Model Results

Perception of

Safety

Culture

0.64

0.54

0.25

-0.02

0.28

Perceptions of

Leadership

Commitment

Attitude toward

Change

Perception

of Safety

RMSEA = 0.030 (Root Mean Squared Error of Approximation)

Total causal effect of 0.72

Chapter 8

(Summary of empirical findings)

• Chapter 5 presents the events leading to collapse of

the Take-Off 05 project

• Chapter 6 shows how individuals experience

different phases of a common change process

(embedded cases)

• Chapter 7 gives a snapshot of the relationships

between the latent variables in the conceptual model

Academic contributions

• Insights into the effects of deliberate organizationalchange on safety in a High ReliabilityOrganization

• How a mismatch between organizational culturetype and change implementation type can effectchange outcomes

• How perceptions of leadership commitment effectsattitudes toward change and perceptions of safety

Academic contributions (2)

• The value of using safety audits and structural equation modelling as proactive indicators of changes in safety

• Based on the results of the SEM model and thewithin-case/across case analyses it is clear thatsafety was negatively affected during the Take-Off05 process

Questions/Discussion

measuring the effects of strategic change on safety in a ... · measuring the effects of strategic...

Documents