Human Factors In the Control of Major Hazards

1. Human Factors In the Control of Major Hazards “Business Excellence through SHE Excellence?” Hansjürgen Labudde, DuPont PRISM Seminar, Athens, 4th / 5th September 2003

2. A little bit of history E. I. du Pont de Nemours1802 Early DuPont powder mill, Wilmington, Delaware – 1865 Page 2

3. What you might knowabout DuPont • Worldwide benchmark for industrial SHE • $24 Billion in revenue • 79,000 employees operating in 70 countries on 6 continents • 5 core business segments including DuPont Safety & Protection Page 3

4. DuPont in Europe, Middle East & Africa 2002 • Sales: $ 6.31 billion • ATOI: $ 727 million • Employees: 18,200 • Approx 66% of European sales areproduced, refined or manufacturedin the region. Page 4

5. Plants R&D/Technical Service Centres Offices Joint ventures DuPont locations in the region Page 5

6. DuPont’s core values Ethics Fair treatment of people Safety, Health and Environment(SHE) Page 6

8. Business Excellence through SHE Excellence? A Shift in Beliefs

9. Shifting a Belief: Safety performance can be managed. Things go wrong, accidents happen. Drive towards excellence! Zero injuries Zero spills. Zero wrong financial transactions. Zero …..

10. Shifting a Belief: All accidents and incidents are investigated because we want to learn. Fatalities and serious injuries are investigated because it is required by law. Understand root causes! Of accidents. Of productivity problems. Of complaints. Of …..

11. Shifting a Belief: Safety performance can be managed. Safety performance is a question of luck. From reaction to prevention! Initiative Operational discipline Personal responsibility …..

12. Shifting a Belief: Employees must be educated and empowered so that they perform. Employees must be supervised so that they comply. Focus on people! Lean organization. Tap the capabilities of all employees. Empower people. …..

13. Developing an Organization: Natural Instincts • Where do you want to be? • How fast do you want to get there? Injury Rates Errors Failures to perform Supervision Reactive Self Dependent Teams Independent Interdependent • Management • Commitment • Condition of • Employment • Fear/Discipline • Rules/Procedures • Supervisor • Control, Emphasis, • and Goals • Value All People • Training • Personal Knowledge, • Commitment, and • Standards • Internalization • Personal Value • Care for Self • Practice, Habits • Individual Recognition • Help Others Conform • Others’ Keeper • Networking Contributor • Care for Others • Organizational Pride

14. The employee is in the focus • Active • Informed • Aware about company goals • Responsible • Decisive • Self-confident • Independent • Team oriented

15. Business Excellence through PSM Excellence? A Shift in Structures & Behaviors

16. The goal is "ZERO"

17. The DuPont Approachto Managing Process Safety • Four Key Steps: 1. Establishing a Safety Culture 2. Providing Management Leadership and Commitment 3. Implementing a comprehensive PSRMprogram 4. Achieving Operating Excellence through Operational Discipline

18. “ WHAT GETS MEASURED;GETS DONE” ZERO PROCESS INCIDENTS LEADING INDICATOR METRICS

19. ZERO PROCESS INCIDENTS LEADING INDICATOR METRICS • Purpose: • Metrics are necessary to audit and continuously improve PSM • `Leading Indicators´ are beneficial in assessingthe effectiveness of existing PSM programs and identification of trends in performance • Metrics in themselves will not achieve excellence, but do provide a “window” through which management can see the effectiveness of their systems

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21. Auditing • PRINCIPLE • Auditing provides a measurement of compliance with the established PSRM program. Field observations yield data for determining performance against established standards.

22. Auditing • Features • All 15 elements of PSRM program periodically audited • Checklists used and documents evaluated • 1000 points are allocated in total to the elements (weighted) • Each question in the checklist must be addressed • The team must make a determination of the degree of compliance with the requirements of each question • If a checklist question is scored less than 100%, thena recommendation must be written to achieve 100%in future Score STD

23. Global PSM 2nd Party Audit Scores (HHP’s) 1992- 2002 “The purpose of SHE 2nd party audits is to determine whether appropriate management systems and controls are in place to effect compliance with corporate policies, standards, and applicable laws and regulations to continually improve SHE performance” (S2Y) March 2003

24. 1H 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 Number of Audits 10 17 22 31 35 38 37 41 59 56 19 High Score 87 93 91 96 96 96 97 98 97 97 97 Low Score 64 59 67 65 60 54 65 68 43 55 62 Average 75 81 82 84 85 86 86 89 86 89 90 Management 71 79 76 84 82 85 86 87 85 88 91 Process Tech 83 87 85 82 85 86 83 89 84 87 87 PHA 73 77 80 81 85 86 85 89 84 90 90 MOC - Tech 78 77 82 79 84 86 82 90 89 91 88 Oper Procedures 80 87 80 85 85 88 85 88 83 88 93 Tng & Performance 74 85 85 91 89 91 90 91 87 91 93 Contractor Safety 93 96 90 90 85 88 92 95 93 94 95 MOC - Pers 55 71 69 73 78 81 79 82 81 86 90 Incident Invest 84 86 85 87 89 92 89 92 85 92 95 Emergency Response 83 86 88 90 87 90 92 93 88 90 92 PSM Auditing 60 61 69 74 71 79 77 83 83 88 87 Quality Assurance 90 85 85 90 87 91 91 88 88 89 95 Mechanical Integrity 63 71 74 85 84 84 85 85 81 85 85 Mgmt of Subtle Change 65 82 78 80 86 86 84 92 86 87 93 Pre-Startup Review 72 81 81 84 86 85 87 89 91 91 91 PSM 2nd Party Audits - Average Scores 1992-2002

26. Incident Investigation • PRINCIPLE • Serious and serious potential incidents are likelyto recur unless key factors are identified and corrected. Aggressive and persistent investigation of all serious and serious potential incidents is necessary to continuously improve safety performance.

27. Why Spend Time Investigating? • Prevent recurrence • Share findings with others • Identify related problems • Guide development of standards

28. Corporate Investigation Standards • S 3Y Incident Investigation • S 8Y Process, Fire, Distribution and Environmental Incident Classification and Reporting • S 35G Managing Occupational Injuries and Illnesses Incident

29. To Prevent Recurrence ? Metrics ? • Root cause – contributing factors • PSM elements which need strengthening • Closure of recommendations • Effectiveness verification of implemented recommendations • Frequent analysis of contributing factors Incident Analysis

31. Other PSM Metrics and Indicators • PSM leading metrics must be a highly visible focal point on a continuous basis • Strong systems and processes combined with information technology are a key means to sustain focus in times of change • Incidents are also important inputs, but are not viable in terms of preventing low probability significant events to ensure we don’t get complacent Success and good performance (no incidents) are the enemy of continuous improvement

32. Recommendations Open /Overdue

33. Life Example of a DuPont Site

34. Safe Working Environment - June 2003 Safe Working Index by month Elapsed Time between Incidents Incidents by Severity

35. Operational Discipline:rigour, focus in upgrading systems - June 2003 System Audits and Reviews completed (SHE, PHR, Incident Investigations, 2nd Party, What If’s) Recommendations Outstanding >90 Days Recommendations Outstanding >365 Days

36. PSM Metrics - June 2003 Target 2003: 0 Target: all currently overdue closed by June and maximum of 10 thereafter Target: 6 months

37. PSM Metrics Beyond significant PSM incidents and audit scores … How is your site leadership using PSM metrics to drive performance and improvement - is it working ; if not, why ? What, if any, key PSM metrics are routinely reviewed at the SBU or regional level to evaluate performance and drive strategy ? How are you personally using metrics and audit results/ trendsto ensure effectiveness of PSM systems as a PSM Leader ? What should we do that is additive or different to sharpen our focus on performance (vs systems) ?

38. CONCLUSION Good Safety = Good Business

39. Excellence in Process safety management is a key and unwavering part of our SHE commitment and a fundamental tenet of our operating philosophy. • We must ensure that we stay focused on PSM through periods of businessand organizational change, including personal accountability by all leaders • We also must continue to improve leveraging our knowledge and experience internally for broader benefit • Ongoing success can only be attained by applying a rigorous operating discipline to our process safety applications • Data management tools and Six Sigma methodologies are important piecesin our arsenal to help our businesses improve and sustain PSM performance Last Thoughts DuPont Strategy - Sustainable growth through productivity, integrated science and knowledge intensity growth / change + human beings = transition

40. Danke schön Thank you