Emergency Management - It's an Investment, Not a Cost

When setting your budget or making a case for the necessary funds for an emergency management program a common assumption may see your endeavours not reach their full potential. Many people, Chief Executive Officer's and Chief Financial Officer's alike, view requests for funding with regards to emergency management as a cost. Like everything else on their spreadsheet, emergency management is something that incurs allocation of valuable revenue and competes with every other project or running cost.

Changing that point of view from a necessary cost to an investment in the safety of the premises, business and its employees may be the difference you need to make your case, or the different point of view required by a CFO to approve the expenditure.

In the aftermath of many industrial accidents and emergencies it is astounding how often investigators discover that companies, in an effort to save a few thousand dollars, create or overlook a safety deficiency or take shortcuts on implementing emergency preparedness. This saving, in so many instances is so small as to be insignificant when compared to an incident that ends up costing the company millions, if not billions of dollars in lost production, damaged or destroyed infrastructure or stock loss, reputational damage and customer backlash, legal fees and compensation.

Two very prominent examples include firstly, BP's Deepwater Horizon oil rig explosion 2010. In January 2011 the White House oil spill commission released its final report on the causes of the oil spill. They blamed BP and its partners for making a series of cost-cutting decisions and the lack of a system to ensure well safety.

Secondly, the Kings Cross, London Underground fire 1987, a subsequent public inquiry determined that the fire was caused by a lit match being dropped onto the escalator, a careless action or accident leading to the deaths of 31 people. London Underground were strongly criticised for their lax attitude to fires because there had never been a fatal fire on the Underground. Consequently, staff had been given little or no training to deal with fires or evacuation.

These are but two examples in possibly thousands of incidents, accidents and emergencies stemming from the perception of saving money by safety and emergency short cuts.

Next time you are preparing your emergency budget, don't make the case for the expenditure as "How much will this program cost?" but rather "How much could this investment stand to save us?"