The Knowledge Exchange / Business Analytics / Safety analytics: The business of prevention

Safety analytics: The business of prevention

Kelly LeVoyer, Director, Communications, SAS

Dave Duden has a personal interest in how human behavior predicts and affects workplace safety: “I want every employee to be able to go home to their families every night. Everybody deserves a safe workplace.” As a director for Deloitte Consulting working on the firm’s claims and safety analytics initiatives, Duden spent time at this week’s Analytics 2012 conference sharing insights into how advanced analytics can have a holistic effect on workers’ compensation claims analysis and workplace safety.

Workplace injuries directly impact employee productivity and company profitability – and, to Duden’s point, indicate often missed opportunities to improve working environments.

Traditional methods of analyzing workers’ compensation claims tend to focus on lagging indicators, which means the data is always two to three months old. Claims data is integrated only with traditional data like employee and incident data, missing a huge predictive opportunity.

Clients often hire Deloitte to help them better manage these claims, with the ultimate goals of reducing unnecessary costs and increasing overall workplace safety. By combining a client’s internal data with public data like crime statistics and weather data, Duden says, they can help predict the severity of the claim, and manage the claim appropriate to that expected severity.

The firm has made some surprising discoveries. For example, the distance an employee lives from his or her place of work is a consistent predictor of the severity of a claim – longer distances between home and work tend to point to higher severity claims. This one variable is factored in with 75 to 100 other variables for a sort of “severity score,” which clients use at an aggregate level such as for a distribution center or a store location.

“All of our clients have safety programs,” Duden says, “Safety analytics just helps them focus those resources in the right way.” Clients can use the data to prioritize which locations or areas receive updated safety measures first, or to help justify additional investments in safety equipment. “The scores don’t mean anything unless you can use them to implement better programs,” Duden says.

According to Deloitte’s analysis, clients have experienced savings of 7-14 percent on workers compensation costs by putting these types of practices into place. Combined with the overall benefits of safer workplaces and improved sustainability of the workforce, this analytical approach seems to be a pretty safe bet.

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