The Inclusive Management of Operating Risk, Efficiency and Organisational Dynamics at the Cosmo Howley Mine

The typical management systems used to address the issue of operating risk centre around technologies that identify, analyse and evaluate the risk factors. These logical systems such as HAZOPs, Fault Tree Analyses, etc rely heavily on technical considerations and process flow analysis. However, several research projects, across industries and countries have clearly shown that up to 80 per cent `operating risk' is determined by the actions of workers, supervisors and managers. Yet, most of the focus of risk management is on technical and procedural issues. This suggests that a significant imbalance exists in our management systems and that industries are unlikely to show significant improvement on current levels of safety performance. Effective risk management must include the intangible element of the organisation psychology towards risk. A practical and theoretically sound approach had been researched and developed in and for the mining industry. This paper describes the approach and methodologies applied at the Cosmo Howley Gold Mine in the Northern Territory, where an inclusive approach to managing financial and operating risk was followed. The Cosmo Howley Mine showed a dramatic reduction in lost time injuries and improvements in financial indices - providing conclusive evidence of the link between management effectiveness, safety and productivity. This `triangle' has often been the subject of speculation and theory. It is demonstrated in this paper how the management team of Cosmo Howley focused their practices and systems on the improvement of organisational dynamics, ensured tangible and clear focus on parameters of costs and safety and how the improvement process was managed. It is concluded that the improvement process did not require a `major re-engineering' of the organisation. The organisation culture changes that occurred were incremental, planned and effective. It entailed the implementation of sound risk management methodologies, and ensured that a significant emphasis was placed on an aspect that is defined as `organisational dynamics'.