Paul Henry O'Neill:
The entire book is speak about
leadership of Paul Henry O'Neill
who was the CEO of Aloca Group and served as the United States Secretary of the
Treasury for part of President George W. Bush. During tenure
of Aloca, His main focus is only safety of employees. Before O’Neill’s arrival, almost every Alcoa plant had at least one
accident per week.
O'Neill was Chairman and CEO of
the Pittsburgh industrial
giant Alcoa from 1987
to 1999 and retired as chairman at the end of 2000. At the beginning of his
tenure O'Neill encountered significant resistance from the Board of Directors
due to his stance on prioritizing worker safety. One argued reason that he could
remain in office was his level of CEO power. The company's market value
increased from $3 billion in 1986 to $27.53 billion in 2000 (918% increased),
while net income increased from $200 million to $1.484 billion (742%
increased).
1.Vision of Zero Injuries:
“I want to talk to
you about worker safety,” he said. “Every year, numerous Alcoa workers are injured so badly that they miss a day
of work. Our safety record is better than the general American work force,
especially considering that our employees work with metals that are 1500 degrees and machines that
can rip a man’s arm off. But it’s not good enough. “I intend to make Alcoa
the safest company in America. I intend to go for zero injuries”
“I went to basics,”
he told me. “Everyone deserves to leave work
as safely as they arrive, right? You shouldn’t be scared that feeding your family is going to kill you. That’s
what I decided to focus on changing everyone’s safety
habits.”
At the top of
O’Neill’s list, he wrote down “SAFETY” and set an audacious goal zero injuries and Zero injuries period. That would be his commitment no
matter how much it cost.
O’Neill never
promised that his focus on worker safety would increase Alcoa’s profits.
However, as his new routines moved through the
organization, costs came down, quality went up and productivity skyrocketed. If molten metal was injuring workers when it
splashed, then the pouring system was
redesigned, which led to fewer injuries. It also saved money because Alcoa
lost less raw materials in spills.
“I’m happy to
negotiate with you about anything,” O’Neill said. He was on a tour of Alcoa’s American plants, after which he was
going to visit the company’s
facilities in thirty-one other countries. “But there’s one thing I’m never going to
negotiate with you, and that’s safety. I don’t ever want you to say that we haven’t taken every step to
make sure people don’t get hurt. If you want to argue with me about that, you’re going to lose.”
Within a year of
O’Neill’s speech, Alcoa’s profits would hit a re- cord high. By the time O’Neill retired in 2000, the company’s annual
net income was five times larger
than before he arrived, and its market capitalization had risen by $27
billion.
What’s more, all that growth occurred
while Alcoa became
one of the safest
companies in the world. Before
O’Neill’s arrival, almost every Alcoa plant had at least one
accident per week. Once his safety plan was implemented, some facilities would go years without a single
employee losing a work day due to an accident. The company’s worker injury
rate fell to one-twentieth the US average.
So how did O’Neill
make one of the largest, stodgiest and most potentially
dangerous companies into a profit machine and a bastion of safety.
In other words, to protect
workers, Alcoa needed to become the best, most streamlined aluminum company on
earth.
O’Neill’s safety plan, in effect,
was modeled on the habit loop. He identified a simple cue an
employee injury. He instituted an automatic
routine. Any time someone was injured, the unit president had to report it to O’Neill
within twenty-four hours and present
a plan for making
sure the injury never happened again.
And there was a reward, the only people who got promoted
were those who embraced the system.
2.Accident Sharing with whole organization.
O’Neill ordered all the plant’s
executives as well as Alcoa’s top officers in
Pittsburgh into an emergency meeting. For much of the day, they
painstakingly recreated the accident with diagrams and by watching videotapes again and again.
They identified dozens
of errors that had contributed to the death,
including two managers who had seen the man jump over the barrier but
failed to stop him;
“We killed this
man,” a grim-faced O’Neill told the group. “It’s my failure of leadership. I caused his death. And it’s the
failure of all of you in the chain of command.”
Within a week of
that meeting, all the safety railings at Alcoa’s plants were repainted
bright yellow, and new policies
were written up. Managers
told employees not to be afraid to suggest proactive maintenance.
“I want to congratulate everyone for bringing
down the number
of accidents, even just for
two weeks,” he wrote in a memo that made its way through the entire company.
“We shouldn’t celebrate because we’ve followed the rules or brought down a number. We
should celebrate because we are saving lives.”
3. Find out the root cause / Main Cause:
O’Neill
was tasked with figuring out why. He asked other federal agencies to start analysing infant mortality data and
each time some-
one came back with an answer, he’d ask another
question, trying to get
deeper, to understand the problem’s root causes. Whenever someone came into O’Neill’s office with some
discovery, O’Neill would start interrogating them with new inquiries.
Some research, for instance, suggested
that the biggest
cause of infant deaths was premature births and the reason babies were born too early was that mothers suffered from malnourishment during pregnancy. So,
to lower infant mortality, improve mothers’ diets. Simple, right? But to stop malnourishment, women
had to improve their diets before they became pregnant. Which meant the
government had to start educating
women about nutrition before they became sexually active. Which meant officials had to create nutrition
curriculums in- side high schools.
However, when O’Neill
began asking about how to create those curriculums,
he discovered that many high school teachers in rural areas didn’t know enough basic biology to teach nutrition. So the government had to remake
how teachers were getting educated
in college, and give them a stronger grounding in
biology so they could eventually teach nutrition to teenage girls, so those
teenagers would eat better before
they started having sex, and, eventually, be sufficiently nourished
when they had children.
Poor teacher training, the officials
working with O’Neill finally figured out, was a root cause of high infant
mortality. If you asked doctors or public health
officials for a plan to fight infant
deaths, none of them would have suggested changing how
teachers are trained. They wouldn’t have known there was a link.
In 2000, O’Neill retired
from Alcoa, And at Alcoa, O’Neill’s legacy lives on. Even in his absence, the injury rate has continued to decline. In 2010, 82 % of
Alcoa locations didn’t lose
one employee day due to injury.
🙏THANK
YOU🙏