How safety culture drives profit in manufacturing
Author: Sjoerd Nanninga
Safety isn’t a cost center; it’s a competitive advantage.
Operational leaders in chemical, pharma, and food plants often face the same question: Can we really link safety culture to profitability? The answer is Yes and the evidence is clear. When people feel safe, they perform better, speak up sooner, and help solve problems before they grow. That reliability translates directly into financial performance.
Play-Doh and the Power of Safety
When Hasbro brought the Play-Doh production back to Massachusets in 2017, the decision wasn’t about labor costs or tax breaks. It was about safety culture. The East Longmeadow plant, run by Cartamundi, had spent years building a strong safety system under OSHA’s Voluntary Protection Program. Hazards were flagged quickly, fixes implemented collaboratively, and every worker felt empowered to act.
Hasbro explicitly cited safety as the reason for reshoring Play-Doh. Safety made the U.S. operation the most profitable option.
That environment did more than prevent injuries. It improved throughput, cut disruptions, and gave Hasbro confidence that U.S. production could outperform offshore competitors.
This story captures a larger truth: safety is not a cost centre. It is a competitive advantage.
From compliance to value creation
Paul O’Neill, former CEO of Alcoa, reframed safety as a core management system, not a compliance checkbox. His message: when leaders visibly care for people, employees release “discretionary energy”: the extra effort that drives quality, reliability, and profit.
Under his tenure, Alcoa’s market value grew from $3B to $27B, while it became one of the safest industrial firms in the U.S.
Take away for HSE and operational managers: Safety can be your most powerful lever for performance.
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The “Zero Harm” debate
But are we now moving back to checkbox compliance? In many boardrooms, the pendulum has swung from ambitious “Zero Incidents or Zero Harm” slogans to a quieter “good enough” posture (“we’re doing OK on safety”). Critics of Zero Harm argue that absolutist targets can suppress reporting and erode morale; supporters say the aspiration elevates discipline and culture. In healthcare and industry literature, you’ll find both perspectives and a growing emphasis on culture and systems over slogans.
Has the broader anti“woke” backlash nudged some leaders to dismiss Zero Harm as mere political correctness? Some safety commentators do connect today’s culturewar rhetoric with scepticism toward visible safety commitments. Whether or not one accepts that causal link, the business reality remains; safety excellence correlates with better operations and stronger financials.
Whether you think Zero Harm is inspiring or performative, and whether you see “woke vs. antiwoke” in workplace debates, the operating truth is apolitical: when people feel physically and psychologically safe, they speak up and solve problems. That creates tight processes, fewer defects, and steadier earnings. O’Neill’s Alcoa made this a management system, not a slogan.
Take away: What matters more than the slogan is the system behind it. Plants that treat safety as culture and discipline, not just compliance, see both safety incidents and production losses decline.
Accidents are the ultimate waste in manufacturing
Accidents are first and foremost human tragedies. On top of that, they are visible waste. They signal broken processes that also cause production mistakes, downtime, and quality failures.
The classic accident pyramid shows that small incidents predict severe ones. Modern safety management sharpens this by focusing on serious injury & fatality (SIF) precursors, events that could have led to life-altering harm.
- Low injury rates can hide high-potential risks.
- Classify incidents by risk, not just consequence.
- Proactively hunt for SIF precursors.
The implication is clear: investing in early warning systems protects both people and productivity.
Want to talk more about investing in people and productivity? Book call.
The Data is consistent: Safety & Reliability Rise Together
A persistent question from operators is whether safety “pays.” Multiple lines of evidence say yes:
- Correlation: In multi-plant datasets, reliability and safety improved together: R ≈ 0.80, which is unusually strong for operational data. When plants run reliably, injuries drop. (SMRP)
- Survey evidence: In a study with Plant Engineering magazine, 83% of manufacturing leaders reported productivity improvements after implementing safety programs. (Advanced Technology Services)
- Financial proof: Peer-reviewed studies show safety culture → safety performance → financial performance.. (Riuma)
Together with case investigations showing that process safety lapses drive unplanned shutdowns, equipment damage, and massive costs, the message is consistent: safety is an operational strategy.
Key takeaway: Safety is an operational strategy that pays back in productivity and profit (and not an expense).
Paul O’Neill’s core message: Care → Safety → Profit
When O’Neill became Alcoa’s CEO, he told Wall Street, “I want to talk to you about worker safety.” Analysts were baffled. Then the numbers came in. Under his tenure (1987–2000), Alcoa’s market value grew from roughly $3B to $27B, even as it became one of the safest industrial firms in America. O’Neill didn’t pick safety to be sentimental; he picked it because it mobilizes trust, focus, and discretionary energy.
His operating system was concrete: 24-hour reporting of injuries to the CEO, transparent root cause analysis, and rapid countermeasures shared across sites, Behaviours that cascaded into faster learning and fewer defects.
Why the Correlation Exists
Plants with exceptional safety tend to excel in maintenance rigor, operational discipline, and learning culture. These are exactly the capabilities that also deliver stability, yield, and cost control. As reactive “firefighting” work declines and planned work rises, injuries drop and uptime improves; it’s the same management muscle, applied consistently.
A Reminder from History
Boris Yeltsin once said, “We don’t appreciate what we have until it’s gone. Freedom is like that. It’s like air.”
Safety is the same: invisible when present, painfully conspicuous when lost. Don’t wait for a major incident to rediscover its value.
Bottom line
You don’t have to pick sides between slogans. Focus on:
- Building safety into everyday plant operations
- Insisting on process discipline
- Measuring safety alongside production performance
Do this and the profit will follow.
A Concrete Alcoa Story: Discretionary Energy in Action
At Alcoa smelters, molten metal splash posed a serious hazard. Rather than accept it as “part of the job,” frontline teams and engineers redesigned the pouring system to eliminate the exposure. The fix did two things at once: it reduced injuries and it cut spillage waste, improving throughput and quality. That is discretionary energy, people choose to go beyond compliance because they knew leadership truly cares.
His operating system was concrete: 24-hour reporting of injuries to the CEO, transparent root cause analysis, and rapid countermeasures shared across sites, behaviours that cascaded into faster learning and fewer defects.
Sjoerd Nanninga:
“When safety becomes part of the way people work, everything else improves too. Processes run more smoothly, teams feel empowered, and performance follows naturally. At Unite-X, we believe safety is not just protection from harm – it’s the key to unlocking the full potential of your operations.”