Safety management

1. Major Hazard Facilities
Safety Management Systems

2. 2
Overview
The seminar has been developed to provide:
•Context with MHF Regulations
•An overview of what is required
•An understanding of the SMS and why it is important

3. 3
•AFAP - As far as (reasonably) practicable
•Employer - Employer who has management control of the facility
•ER or ERP - Emergency response or Emergency response plan
•Facility - any building or structure at which Schedule 9 materials are
present or likely to be present for any purpose
•HAZID - Hazard identification
•HSR - Health and safety representative
•LOC - Loss of containment
•LOPA – Layers of protection analysis
•MA - Major accident
•MHF - Major hazard facility
•MOC – Management of change
•OHS - Occupational health & safety
•SR - Safety report
•SMS - Safety management system
Some Abbreviations & Terms

4. 4
Topics covered in This Presentation
•Introduction
•Regulations
•What is a safety management system?
•SMS models and standards
•Key elements of the SMS
•The importance of SMS
•What should the SMS do?
•Measurement of performance
•Examples of SMS performance standards
•Emergency planning
•SMS testing
•Items to note
•Critical success factors
•Sources of additional information

5. 5
Regulations
Occupational Health and Safety (Safety Standards) Regulations 1994

6. 6
What is a Safety Management System?
•An SMS is a comprehensive and integrated system that
ensures that all work at the facility is conducted safely
•It should be fully documented, accessible and comprehensible
to those that need to use it
•It recognises the potential for errors and establishes robust
defences (control measures) which are fully implemented, to
ensure that errors do not result in accidents or near misses
•It is comprises a set of work practices and procedures for
monitoring and improving the safety and health of all aspects
of the operation

7. 7
Key Terms Used in Describing the SMS
Comprehensive
•Describes the way that all safety issues including control
measures are managed
•Clear link between controls management and the SMS
Integrated
•The structure is logical, systematic
•Logically ties in to other management systems
•Corporate systems do not contradict onsite systems
Comprehensible
•Abbreviations and terms used mean something to employees
•Consideration of language issues

8. 8
Key Terms Used in Describing the SMS
Implemented
•Procedures are approved and in circulation
•Evidence is available – completed forms and/or checklists
•Employees are trained and knowledgeable
Accessible
•Employees are aware of how to obtain the most up to date or
relevant procedures
•Employees can obtain the SMS information needed to support
control measures

9. 9
SMS Models & Standards
•Sound management systems are all similar in fundamental
terms
•Compliance with the MHF Regulations does not require any
particular standard to be used, nor will compliance with an
existing management standard ensure compliance with the SMS
requirements of the MHF Regulations
•There are a variety of ways in which the SMS can be structured.
Most large organisations will have their own structure already
•However, adoption of a proven standard may assist an MHF
employer

10. 10
Examples of SMS
OH&S Management Systems Model – AS 4801
gg
Safety PolicySafety Policy
PlanningPlanning
Implementation
& Operation
Implementation
Checking
&
Correctiv
Actio
Measurement
& Evaluation
Continual
Improvement
Continual
Improvement
Manageme
nt
Revie
Management
Review
Overall
vision, goals
and
commitment
to improve
•Legal compliance
•Objectives and targets
•Implementation plans
•Resources
•Leadership responsibility
•Training and competency
•Consultation and communication
•Documentation
•Hazard identification, risk assessment
and controls
•Emergency response
•Monitoring and
measurement
•Incident investigation
•Records management
•Audits
Suitable, adequate,
effective
Changes needed?
Opportunities to
improve?

11. 11
ISO 14001 Environmental Management Systems
Environmental
Policy
Management
Review
Planning
Implementation
& Operation
Checking &
Corrective Actions
Examples of SMS

12. 12
Key Elements of the SMS
From the previous
examples, there are
common elements
Policy
Planning
Implementing
Assessing
Management
Review

13. 13
Key Elements of the SMS
Policy
Planning
Implementing
Assessing
Management
Review
Effective health and
safety policies set a
clear direction for the
organisation to follow

14. 14
Key Elements of the SMS
An effective management
structure and arrangements
are in place for delivering
the policy.
There is a planned and
systematic approach to
implementing the health
and safety policy
Policy
Planning
Implementing
Assessing
Management
Review

15. 15
Key Elements of the SMS
The policies and
procedures are put in
place to manage all
aspects of the control
measures that ensure safe
operation of the facility
Policy
Planning
Implementing
Assessing
Management
Review

16. 16
Key Elements of the SMS
Performance is
measured against
agreed standards to
reveal when and where
improvement is needed.
Policy
Planning
Implementing
Assessing
Management
Review

17. 17
Key Elements of the SMS
The organisation learns
from all relevant
experience and applies
the lessons.
Policy
Planning
Implementing
Assessing
Management
Review

18. 18
The Importance of SMS
•In reviews of accidents, a common thread throughout is the
inadequacy of management systems that might have
prevented the accident from occurring
•Examples of some issues identified are
–Lack of hazard review and risk assessment to predict and
prevent incidents
–Insufficient investigation and follow up after previous incidents
–Inadequate training of staff
–Failure to implement effective mechanical integrity programs

19. 19
The Importance of SMS
The following information provides broad details on some US
incidents and contributing causes

20. 20
The Importance of SMS
Management System Categories Contributing Causes
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Breakdown of management system categories identified as
contributing causes in incident investigations

21. 21
The Importance of SMS
•Flixborough 1974
–Management of
modification failure
–Inadequate experience
–Overstretched resources
•Piper Alpha 1988
–Failures in shift handover
–Permit to work
–Training
–Communications
–Auditing

22. 22
The Importance of SMS
•Pasadena 1989
–Maintenance
–Permit to work errors
–Failure to follow-up on
audits
•Longford 1998
–Inadequate knowledge of
hazards
–Absent personnel
–Poor procedures

23. 23
The Importance of SMS
•Corporate safety oversight,
including the safe
management of sites obtained
through mergers and
acquisitions
•Corporate safety culture
•Corporate and site SMS
•Near miss reporting and
investigation programs
•Mechanical integrity programs
•Hazard analysis programs
•Change management
BP America Refinery Explosion Texas City, 23 March 2005

24. 24
The Importance of SMS - Exercise
Buncefield Explosion, UK, 11 December 2005
•In the early hours on
Sunday a number of
explosions occurred at
Buncefield Oil Storage
Depot, Hemel Hempstead,
Hertfordshire
•At least one of the initial
explosions was of massive
proportions and there was a
large fire, which engulfed a
high proportion of the site
•Over 40 people were
injured; fortunately there
were no fatalities

25. 25
The Importance of SMS - Exercise
What control measures
•Were in place?
•Could have been in place?
•Were they effective?
Buncefield Explosion, UK, 11 December 2005

26. 26
The Importance of SMS - Exercise
Buncefield Explosion, UK, 11 December 2005
Control Measure Effectiveness?
Level meter & alarm Failed before alarm
Independent HLA & Trip Flow continued
Auto tank gauge system Did not prevent overflow
P
r
e
v
e
n
t
i
v
e

Operator surveillance Did not prevent overflow
Ignition source control Vapour cloud went off site
Fire water system Pump house destroyed
M
i
t
i
g
a
t
i
v
e

Bunding Penetrations / joints failed

Common theme – failure to manage the control measures

27. 27
The Importance of SMS - Exercise
•What SMS elements were needed to ensure that the control
measures worked when required?
Buncefield Explosion, UK, 11 December 2005

28. 28
The Importance of SMS - Exercise
Buncefield Explosion, UK, 11 December 2005
Control Measure Supporting SMS
Level meter & alarm Testing and inspection
Independent HLA & Trip Critical safety function testing
Auto tank gauging system Preventative maintenance program
P
r
e
v
e
n
t
i
v
e

Operator surveillance Operating procedures and training
Ignition source control Design standards, purchasing specs
Fire water system Design standards
M
i
t
i
g
a
t
i
v
e

Bunding Maintenance and integrity inspection

29. 29
The Importance of SMS – Australian Experience
•Feedback from regulator site visits to Australian MHFs,
together with examination of incident data has revealed the
following issues are likely to be the weakest links within an
SMS
–Management of 3
rd
parties
–Maintenance procedures and systems
–Hazard identification and analysis
–Engineering design and review
–Operating procedures
–Management of change

30. 30
The Importance of SMS – Australian Experience
Other issues to note:
•There are always fundamental failings in the “system”
•Complacency and safety versus production conflicts
•Deficiencies in practice with adherence to application of the
SMS rather than system standards
•Failure to accept and prepare for emergencies

31. 31
What Should the SMS Do?
•The SMS is the tool with which the Employer meets the overall goal
of the Regulations
•The SMS should cover the following
–Define safety roles and responsibilities
–Ensure adequate skills, information, tools and decision-making are
present in day to day and abnormal operations
–Maintain awareness of hazards and risks
–Plan, implement, measure and evaluate MA controls and the SMS
–Develop performance requirements
–Set targets for improvement of safety at the facility
–Manage change

32. 32
What Should the SMS Do?
•Manage and maintain knowledge
•Instigate HAZID and risk assessments
•Manage adequate human resources
•Provide performance information to all levels of
organisation
•Review and improve the SMS itself

33. 33
What Should the SMS Do?
•Manage safe operation at the facility, including MAs,
specifically focusing on:
–Prevention
–Reduction
–Mitigation
•It is not just documentation - it is the actual implementation
of processes, procedures and practices at the facility
•Include and reflect the safety culture at the workplace

34. 34
What Should the SMS Do?
•Some companies, in particular employers of multiple sites, may
apply corporate standards for an SMS
•These may prescribe the entire SMS, or only common high-level
components such as the overall policies and procedures
•In other cases corporate SMS requirements may be very
limited, and the site will then need to develop its own systems

35. 35
What Should the SMS Do?
•Many corporate systems specify that local regulations override
corporate requirements if they are more stringent
•Other companies may employ integrated management
systems for the business as a whole
•It is entirely up to the Employer to choose how the SMS is
structured and developed
•However, in all cases the SMS must provide a management
focus on the specific control measures required for safe
operation of the particular facility

36. 36
What Should the SMS Do?
Accidents
H
a
z
a
r
d
s
C
a
u
s
e
s
C
o
n
s
e
q
u
e
n
c
e
s
Local procedures and practices (design, maintenance & operation)
Prevention
Controls
Mitigatio
n
Controls
Corporate Safety Management System
MA Potential
Level 1
Level 2
Level 3

37. 37
What Should the SMS Do?
•The SMS should not just be seen as satisfying MHF
requirements
•It should be used as a performance management tool to assist
in managing the entire operation, including other performance
based regulatory requirements
•Most modern management system “standards” or "models"
feature a set of generic elements, forming a continual
improvement cycle

38. 38
Measurement of Performance
•Performance standards/indicators must be developed and
implemented as part of the SMS (e.g. measure the
effectiveness of SMS) to support the MHF safety objectives
•The following principles apply in defining performance
standards: Make them SMART
•Specific
•Measurable
•Achievable
•Realistic
•Targeted
•The purpose of performance standards/indicators for the SMS
is to enable the objective measurement of its target and
(subsequently) effective maintenance and improvement of
performance

39. 39
Measurement of Performance
•Standards and systems need to be practical
•Should not place an unworkable burden on employees
•Ensure open, comprehensive and accurate reporting of errors or
problems
Is an absence of evidence of problems really indicating
high performance?

40. 40
Measurement of Performance
•Performance indicators need to be meaningful and contribute to
the overall evaluation of the SMS effectiveness
•If a control is stated to be in place for prevention of an MA,
then:
–Is it implemented?
–Is it effective?
–Is it audited?
–Are the results used for improving the effectiveness of controls
management?

41. 41
Measurement of Performance
•Performance indicators should be established covering (as a
minimum):
–How often audits are to be undertaken
–Scope of the audits
–Are the controls implemented?
–Are the controls functional?
–% compliance, partial compliance and non compliance
•Performance indicators should be sufficiently detailed and
transparent to enable the effectiveness of the SMS to be
apparent from the documentation

42. 42
Measurement of Performance
•The audits need to be evaluated against criteria developed by
the MHF
•They should include steps to continually improve the SMS, so
there needs to be processes and measures designed to
identify and implement improvements to the system itself
•Three main types of audits
–First audit: Self audit
–Second party: audit of suppliers
–3
rd
party: external agencies e.g. regulator, certification bodies.

43. 43
Measurement of Performance
•Likewise, 100% compliance is a desirable objective - but realistically
not practical
•Setting a tiered acceptability criteria could be an option
Item Compliance Partial
Compliance
Non-
compliance
Audit frequency
for controls met
90% 10% 0%
Audit time frame
achieved
90% 10% 0%
Controls
implemented
100% 0% 0%
Controls
functional
95% 5% 0%
Example only:

44. 44
Examples of SMS Performance Indicators
Permit to work
Management of change
Operating procedures
Auditing
Number of accidents or near misses caused by a
failure of this system
% permits audited compliant with procedure
Number of accidents or near misses caused by a
failure of this system
% of MoC forms completed in compliance with
procedures
% temporary changes beyond their time limit
% of new procedures completed
% of procedures reviewed
% audits completed to schedule
Number of non conformances closed out/month

45. 45
Items to Note - Emergency Planning
•The MHF must prepare an emergency plan addressing the on-
site/off-site consequences
•Must consult with employees and emergency services
•Plan should consider
–Accident type (e.g. major/minor, environmental, personal safety,
on-site, off-site, property damage)
–Command hierarchy and contact information
–Equipment required
–Contingency plans
•Plan should be tested, reviewed, updated

46. 46
Items to Note - Management of Change
•Management of change needs to be considered very carefully
within the safety report
•An issue often discussed is:
–When is a change really a change?
–When is a change not a change?

47. 47
Items to Note - When is a change really a change?
•Any change to an MHF needs to be evaluated in the context of
the safety report
•Examples of this include but are not limited to:
–Organisational change
–Addition of a new unit
–Closure of a unit
–Any modification to a potential MA
•Desired Outcome: Demonstrate that at least the same level of
risk or lower is achieved after the change and that all the
processes within the safety report are followed and transparent

48. 48
Items to Note - When is a change not a change?
•Any change to an MHF that involves swapping like for like is
not considered to be a change
•This assumes the equipment or systems being changed are fit
for purpose

49. 49
Items to Note - Incident Investigations
•Incidents that occur or could have occurred at an MHF are a
valuable source of information
•As with good practice, all incidents at a facility should be
reviewed for lessons learned and their findings implemented
for prevention in the future
•For an MHF, investigation of MAs is of particular importance as
it will provide insight into the mechanism of occurrence

50. 50
SMS - Critical Success Factors
•Adequate resources for both development and improvement
•Personnel are aware of their responsibility and accountability
•Personnel are trained/competent
•Consistent with the understanding of risk gained from the risk
assessment
•There should be sufficient focus on MAs, from planning
through to operations
•The Employer must document the basis for the facility's SMS,
and the SMS itself

51. 51
SMS – Critical Success Factors
•Adequate resources for both development and improvement
•Responsibilities & accountabilities defined
•Adequate education and training is provided for employees
•Covers the whole facility as defined in the safety report
•Employees know how to access it and understand it
•Performance indicators & standards for the control measures and
the SMS as a whole are defined
•Planning, implementation and monitoring processes are provided
for control measures and the system as a whole and failures are
addressed
•Processes are provided for review and revision of control
measures and the SMS
More information is available in Booklet 3 on the SMS
Comprehensive and Integrated

52. 52
Review and Revision
•The SMS needs to be reviewed on a regular basis to ensure it
is fit for purpose for management of an MHF
•Over a period of time the lessons learned together with results
of performance reviews should enable improvements to be
documented

53. 53
Sources of Additional Information
•Safety Management, Hazardous Industry Planning Advisory
Paper No. 9, Guidelines for the Development of Safety
Management Systems, Department of Urban Affairs and
Planning, 1995
•AS/NZS 4801:2001, Occupational Health and Safety
Management Systems
–Specification with Guidance for Use, Standards Australia,15
November 2001
–General Guidelines on Principles, Systems and Supporting
Techniques, Standards Australia,15 November 2000

54. 54
•AS/NZ ISO 9001:2000, Quality Management Systems
•AS/NZ ISO 14001:2004, Environmental Management
Systems
•API Recommended Practice 750, Management of Process
Hazards
•API Publication 9100, Model Environmental Health and Safety
Management System and Guidance
Sources of Additional Information

55. 55
•UK Health and Safety Executive HSG65, Successful Health and
Safety Management
•US Department of Labour. OSHA Standard CFR 29 1910.119,
Process Safety Management
•AIChE, CCPS, Guidelines for Implementing Process Safety
Management Systems
•Management System Failures Identified in Incidents
Investigated by the U.S. Chemical Safety and Hazard
Investigation Board, Angela S Blair PE Chemical Incident
Investigator, Process Safety Progress, December 2004,
Volume 23, No.4
Sources of Additional Information

56. 56
Questions?