Quarterly Chief Executive Newsletter
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Supply chain leadership in the public sector
Kia ora koutou katoa,
Those of you who attended the GHSL Chief Executive Forum last year will remember Phil Parkes, Chief Executive of WorkSafe, acknowledging the progress that the government sector is collectively making in relation to enhancing our health and safety systems, practices, and cultures in our agencies. Phil also talked about the need for us to place a greater external focus on our supply chains, something he has reinforced more recently.
We know that safety is a by-product of work going well and as senior leaders in the public sector, we need to recognise that we are in a unique position to influence the levers that determine whether work may go well or not.
Having come through the COVID-19 Delta and Omicron outbreaks, I think this topic is even more relevant now. And, in a recent meeting with Minister Wood, he highlighted that improving supply chain leadership is a focus area for him this year.
Our supply chains, under significant pressure because of the global pandemic, are where some of our most vulnerable people work. These workers can also be directly and indirectly affected by the decisions we make.
This is why New Zealand’s health and safety legislation puts us at the top of the supply chain. As Chief Executives and Officers, we have a personal obligation to find out what’s happening within our own agency’s supply chains, particularly with those closest to the work.
The public sector spends approximately $41 billion a year on procurement of goods and services. We have a significant opportunity to leverage this spending to achieve better social, economic, cultural and environmental outcomes for New Zealand, particularly by ensuring that the health and safety of New Zealanders is prioritised.
Health and Safety at Work Act 2015
As we work to meet our core Health and Safety at Work Act (HSWA) 2015 responsibilities to consult, cooperate, and coordinate with other organisations that we share Person Conducting a Business or Undertaking (PCBU) duties with, we must consider what we can reasonably influence and control, agree on who is best placed to fulfil certain duties, and make sure these things then happen. Many of us will have overlapping duties relationships, providing us with a range of opportunities to influence health and safety outcomes.
Focusing on our supply chains
Our supply chains are where we hold significant influence over health and safety outcomes beyond our immediate work and workplaces. How we set up and commission work can have significant impacts on those downstream and closest to the work. Therefore, it is essential that we set an expectation for health and safety to be a priority and reduce the likelihood of safety trade-offs occurring due to organisational pressures (like time, money, and efficiency).
In some cases, we may also engage with PCBUs who have upstream duties. This is usually where we commission work such as the construction of plant or structures. In these instances, the upstream PCBUs have duties to us (as downstream PCBUs) and our workers to ensure, so far as is reasonably practicable, that the work or the outputs provided to us don't create health and safety risks. This can influence the safety and potential long-term health impacts of what is supplied. We know that health and safety risks increase further down our supply chains, so the best time to minimise risk is from the start.
We also need to consider where we share operating environments with other PCBUs, and/or where we play a regulatory or funding role. In these instances, it is essential we understand the degree to which we can control or influence within these relationships and ensure that those responsible for fulfilling the agreed duties do so.
Upstream, Downstream and Horizontal Duties - Institute of Directors /
GHSL Officer Development Programme
It is complicated when thinking about how to practically manage these relationships and how we, as Chief Executives, seek to gain assurance that these are being appropriately managed to protect all workers and meet our PCBU and officer obligations.
At MPI, this has been a significant area of focus for us, and we found that developing some principles to guide the business while we developed a framework was helpful. The GHSL has developed a case-study of the MPI approach and framework.
Outcomes over compliance
It’s important that as we build the foundations of our approach, we also set our vision for the future. Getting the basics right and aligning to principles sets us up for success. However, as we strive for continuous improvement, we should also consider the factors that sit outside of these principles that may create an environment where accidents are more likely to happen. These are factors such as budget pressures, time overruns, conflicting goals, and organisational trade-offs. There is the opportunity within setting work up this way to reconsider how we define and monitor success and gain the outcomes we would like to see in our agencies.
This is a journey we are all on, and I look forward to us building on our understanding and growing our efforts together.
I invite you to read more about MPI’s approach and learnings and hear Francois Barton’s thoughts on supply chain leadership in the article he’s written for us on behalf of the Business Leaders’ Health and Safety Forum below.
Ngā mihi
Ray
CASE STUDY
Promoting successful relationships: Building MPI's Overlapping Duties and Framework
MPI’s complex relationship network includes a significant number of PCBUs. These occur via contracting chains and funding arrangements, regulatory activities, work carried out at non-MPI worksites and shared worksites.
MPI identified that it needed an overlapping duties framework which would be able to provide visibility and oversight of the type and the nature of the relationships MPI has. This case study presents some of the key insights, learnings and benefits MPI has had through the process of developing the framework.
ARTICLES AND RESOURCES
The Government Health and Safety Guide for Public Service Chief Executives and Officers.
Eight Elements of effective governance and other resources.
Harvard Business Review article.