E2 ManageTech

Estimating Potential EH&S Benefits

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Courtesy of E2 ManageTech

Gaining acceptance and funding for implementing an Environmental Management Information System (EMIS) within an organization often depends on whether the Environmental, Health & Safety (EH&S) department has a “seat at the table.”

If EH&S does not have a “seat at the table,” as is the case in many, many organizations, conducting an accurate and accountable estimate of potential system benefits can be a good way for environmental professionals to get in the door.

This analysis will help to get the attention of the financial advisors in the organization and can be a key component in justifying the costs of an EMIS. With it, EH&S managers and decision makers will better understand the potential cost benefits that can be achieved through automation of EH&S data management processes within a facility or enterprise.

Most EH&S professionals know that processing their information more efficiently will save time and money. Quantifying the benefits of investing in an EH&S solution can be extremely difficult, but there is a tool available today that helps EH&S professionals define the connection between an EH&S solution and your company’s bottom line. This tool, called a cost savings calculator, generates estimates of both the direct and indirect savings a properly implemented EH&S information system can deliver.

Direct benefits are tangible cost savings that can easily be measured, such as reduced labor spent on data management, reduced outside consulting costs, consolidation cost efficiencies and cost accounting. Indirect benefits – those achieved from the reduction of risk and liability by increased accessibility and better use of information – include reductions in fines and penalties, less exposure to employee and third-party lawsuits, fewer hours spent preparing for lawsuits, reduced settlement costs, less negative publicity and reduced emergency response time.

Additionally, benefits should consider those specific EH&S areas that will or may be impacted by the system.
Some of the most common topics often included are:

• Chemical Inventory Management, SARA 312 Reporting
• Compliance Management
• Multimedia Emissions Reporting (SARA 313)
• Multimedia Emissions Modeling (Air, Waste, Water, Etc.)
• Discharge Monitoring Reporting
• Manifest Reporting
• Waste Management
• Fugitive Emissions Management
• MSDS Authoring
• Managing Incoming MSDS

Typically, the largest direct benefits are found in electronic data integration/imports, automating calculation methodologies and report generation, knowledge retention and reductions in outside consulting costs (both IT and EH&S). Indirect benefits stem generally from reduced allocations, less negative publicity, improved accountability, early notification of potentially non-compliant situations, improved agency relations, enhanced compliance and improved community relations.

Calculations of direct benefits rely on very specific elements. To achieve the best projections, the information has to be site specific, company specific, industry specific, process specific and division specific. This is sensitive information that must be compiled with very diligent, patient investigative work that is collected in an extremely non-threatening manner.

The benefit estimates generated by the cost savings calculator are developed using actual data collected from a variety of facilities and/or enterprises in the chemical, oil, semi-conductor, other general manufacturing and public municipality industries. Since the benefit analysis tool was developed using actual site data, the output reflects typical efficiencies achieved by the sample population. As such, the questions are asked so that user input mirrors these actual observed efficiencies. Questions generally are broken down into sections that address a range of activities within the enterprise, such as Information Technology, Compliance Management, Emissions Management and Hazard Communication.

By answering all of the questions in the calculator (which usually takes less than 15 minutes), EMIS supporters can present management with an order of magnitude savings estimate for an individual facility or the entire enterprise, thus providing the first level of justification for an EMIS.

This level is designed to give users a feel for the magnitude of cost savings in automating the processes so they can compare the benefits with existing data management processes. The numbers generated by the cost savings calculator do not provide precise cost benefits for a facility or enterprise. However, the calculator can be of great use in helping the user decide whether further cost benefit research into the automation of EH&S data management is warranted.

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