Audit Trends – Five Things Contractors Need To Do Now

Based on original research conducted by Lifeline Strategies, the cost and frequency of contractor HSE audits are rising dramatically.  Our preliminary survey of oil and gas contractors found that each audit costs an average of $3,400 and respondents estimate that the number of audits has risen by an average of roughly 60 percent  in the past five years.   Find our first blog on this topic here.

If you are a contractor, what does the research tell you about audits?  Here are five suggestions:

  1. Recognize that audits are now a sales and marketing function – An audit tells the operator whether your safety program is up to speed, but, increasingly, the results of that audit decide whether your company gets the job or keeps the job. You should probably consider an audit to be the ultimate sales call.  If you are going to spend several thousand dollars to on every audit, do you want to do the bare minimum or do you want to wow your client?
  2. Get a system – The best companies are prepared before the auditor comes, they have all the information organized and they use the audit to show off their safety approach.   Investing in a polished, organized audit preparation is really what turns the process from a “near death” experience to a change to showcase the company.
  3. Understand the types of audits – Our research showed that auditors use a wide variety of protocols and objectives, from simple compliance audits to safety systems and behavior-based audits. Many times companies don’t understand what type of information the auditor is looking for.  Knowing what type of audit to expect is critical to passing.
  4. Get management buy-in –  A SEMS auditor once told me that the more management participation his company finds in audit meetings, the fewer discrepancies auditors found within the company.   Fortunately, this is one of the most positive trends in audits.   Our survey found that around 85 percent of respondents say that management engagement in the audit process has increased.
  5. Make sure your response to online questionnaires are correct, but don’t stop there – About 70 percent of our respondents thought that auditors put a lot of trust in questionnaires (ISNet, PEC, PICS), but interestingly about a third disagreed.   The message here may be that failure to keep up with those questionnaires may be a deal killer, but a lot of auditors will want to dig deeper to make sure that companies are following the policies they claim to have.

We teach these concepts and share industry best practices in our Contractor audit workshops.  You can find more about them on our Classes and Workshops Page.

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