How much does paper-based risk assessments cost your business?

Every business risk is different but if you take an average value on the cost associated with each part of the risk analysis process, you’ll get a fair idea about how inefficient the paper-based method actually is. The data presented here was taken by surveying a construction business of 12 workers and represents a significant part of our broader risk assessment productivity case study. The average time spent on risk assessment processes per job is:

Avg job time = 9 to 16 mins (for more information in time calculations read here)

Avg no. of jobs per worker, per month = 20 jobs

Therefore to calculate the amount of time spent in a month for each worker:
Avg job time x avg jobs per month
= 9 to16 mins x 20 jobs
= 180 to 320 mins per month
3 to 5.3 hours per month

So we know that for a business of 12 workers, around three to five hours a month is spent completing risk assessment sheets. Depending on where the invoices and time sheets are considered, the costs will be on either the contractor’s business or the plant they work for. In these following calculations we include both costs to show a comparison. The average cost of a worker is:

Avg cost to business = $42.50/hour (Hour much you pay your workers)

Or

Avg cost to plant = $85/hour (How much you charge for your workers)

Therefore to calculate the amount of money spent in a month for a single worker:

Avg cost to business x hours per month
= $42.50 x 3 to 5.3
= $127.50 to $226.66 business cost per month, per worker

Or

Avg cost to plant x hours per month
= $85.00 x 3 to 5.3
= $255.00 to $453.33 plant cost per month, per worker

When you spread these numbers over a 12-month period, it becomes clear just how much money is spent conducting a risk assessment. For a construction contracting business in this survey that has 12 workers the annual cost is:

Business cost per month per worker x number of workers x number of months
= $127.50 to $226.66 x 12 x 12
$18,360.00 to $32,639.00 per year

Or

Plant cost per month per worker x number of workers x number of months
= $255.00 to $453.33 x 12 x 12
$36,720.00 to $65,279.52 per year

No matter how you change the numbers associated with your business there is no getting away from the underlying cost that a risk assessments and SWMS’s related processes have on your business. These approximate calculations do not include the time spent in administration of creating and maintaining a set of SWMS’s that a QTP (Qualified Trade Person) must sign-off. So, how can you reduce this cost? We believe the answer lies in business automation using software-based systems.

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