Transformations across Koch Industries have been highlighted in several recent issues of Discovery (and in the Perspective editorial on page 12 of this issue). From refining to ranching, there is plenty of evidence that the pace of change is accelerating for every Koch business.
But transformation is an expectation of Koch’s capabilities, too, including HR, tax, IT, accounting, MBM®, legal and EHS (environmental, health and safety).
Sheryl Corrigan, KII’s director of EHS, leads a capability that includes more than 1,000 professionals globally. “All Koch employees are expected to be good stewards of our health and environment,” Corrigan said, “but our team is focused on developing and supplying the strategies and tactics that make EHS excellence a reality.”
For the EHS capability, Guiding Principle 2 — Stewardship & Compliance — is the benchmark for evaluating Koch’s environmental, health and safety efforts.
“As Charles Koch emphasized last summer when we rolled out our new Vision and Guiding Principles,” Corrigan said, “each one of us is expected to ‘manage our actions and the resources entrusted to us in a manner that respects the rights of others.’
“At the heart of this is first making sure our employees and our communities are safe. Nothing is more important than people’s safety.
“Then we need to look for ways to eliminate or reduce the risks that could lead to an environmental release. By doing so, we’re respecting the proper use of our precious resources.”
To help us accomplish that, Corrigan points to the use of new technologies and strategies for everything from waste disposal and wetlands maintenance to inspections and remediation projects.
Before those new tools and techniques could be implemented, however, Koch’s EHS capability had to do some serious self-evaluation.
Koch’s EHS leaders realized that KII’s environmental, health and safety performance, while often award-winning, was inconsistent. It varied — sometimes greatly — from one Koch company or site to the next.
“Great safety strategies or environmental practices that resulted in superior performance at one company or site weren’t always shared right away (or even at all) with others,” Corrigan explained.
“That’s a violation of Principle 5, which calls for sharing our knowledge proactively. The lack of knowledge sharing was not usually intentional, but we found the lack of benefit to other companies was very significant.”
The team also found situations where lack of awareness or experience resulted in some EHS functions or responsibilities being assigned to outside contractors at costly rates.
Faced with these findings, “we realized we had to figure out better ways of connecting with customers to deliver what’s needed in a different way.”
DOING SOMETHING ABOUT IT
Based on benchmarking data gathered from several Koch companies, the EHS team ran an experiment. They wondered if connecting all the resources focused on securing air permits could be extended to provide advice and expertise for all Koch companies.
“These are gifted people who are really good at what they do,” Corrigan explained. “By doing a better job of leveraging their expertise across all of Koch Industries, we hoped to create new competitive advantages for other Koch companies.
“We are not only accomplishing that, we are boosting employee satisfaction and we helped avoid the expense of looking outside the company for assistance in this particular area.
“This team is particularly advantaged because they are consistently applying Koch’s risk philosophy. These changes are worth millions, but more importantly, they’re making us more effective at protecting people and the environment.”
Corrigan also emphasized that the goal for KII’s EHS capability is not to centralize everything.
“It takes a balancing act. We know the downsides to not sharing knowledge. But if everything is centralized, or we try to take on something where we don’t have adequate expertise, we run the risk of losing ownership at the site level or not doing the best job.”
Corrigan is especially enthused with how the changes in EHS are creating the potential for increased self-actualization.
“As Charles Koch has emphasized, our process of transformation needs to be bottom-up, not top-down. Before we can have successful organizational change, we need to see individuals doing a better job of realizing their potential.
It’s not enough to make incremental improvements. We need to be thinking in ways that are transformative.
– Charles Koch
“With our new Vision and Guiding Principles, our employees have more and better opportunities than ever to learn new processes, explore new businesses and really hone their skills in a beneficial way.”
Corrigan points to the example of Mark Williamson, a senior environmental engineer based in Wichita, as an example of Guiding Principle 8 — Self-actualization — in action.
Transformation isn’t just about technology. It’s also about applying ideas in novel ways that enable transformation.
– Sheryl Corrigan
“Last year, Mark initiated an experiment with GoCanvas, a mobile app with forms for data sharing. GoCanvas has been around for more than 10 years but was new to him.”
Mark worked with a few FHR operating sites that had interest in utilizing field tablets to eliminate paper forms for environmental inspections. Soon after operations embraced the tool, he taught them how to develop their own inspections.
“This has fostered further experimentation across numerous disciplines such as equipment inspections and safe work practices,” Corrigan said.
“Mark learned about it, applied it in his role, validated it, and then let others know. This led to increased use across multiple sites and fostered broader communication and learning with other Koch companies — including KAES and GP.
“When you consider that Koch companies conduct hundreds of thousands of inspections a year at more than 500 manufacturing locations, a new efficiency can make a huge difference. Mark sees that, has been rewarded for it, and has the satisfaction of knowing he’s made a meaningful difference.”
If Mark had been a “keep-it-to-myself” kind of employee, or reluctant to embrace new technology, Corrigan believes Koch “would have never realized those benefits.”
Thanks to a rethink and reorganization, Sheryl Corrigan is confident that KII’s EHS capability is now adding more value than ever.
“We’re doing a better job of sharing knowledge, utilizing our internal capabilities and giving our employees more fulfilling roles — all while helping to improve the performance and profitability of Koch companies.
“We’ve proved that a different organizational structure and approach can improve our EHS performance — including a meaningful reduction in process safety events — while growing the business and reducing costs,” Corrigan said.
“But the simple fact is, this kind of work is never done. We’ve always got to do better, be smarter and find ways of becoming more effective. The health and safety of our employees and the quality of our environment depend on it.”