Innovative solutions designed to
enhance site engagement, drive
cultural change and demonstrate
RTW commitment
Julian Hodder
National Workers
Compensation Manager
Confidential and Proprietary Information. © Linfox Australia Pty Ltd 2006. All rights reserved.
Agenda
•
•
•
Who are we?
Our key challenges
Our solutions
1. The ‘Charge Back’ model
2. Create an early reporting culture at Linfox
3. Development of a Linfox early intervention model
4. Development of site/branch based RTW ‘tools’
5. Development of a site based RTW pack supported by a National
education program for around 300 RTW co-ordinators
6. Adaptation of the Kaplan/Norton Balanced Scorecard (BSC) to
improve RTW performance
• Results
Rehabilitation and RTW presentation
Linfox Australia and Linfox Armaguard
• Linfox provides sophisticated
supply chain solutions to many
leading companies in 10 countries
throughout the Asia Pacific region.
• Linfox is one of Australia's largest
privately owned companies with
over 11,500 skilled personnel
throughout the Asia Pacific region
providing services to the following
countries:
• The vision of the organisation is
“To be the supply chain solutions
provider of choice throughout the
Asia Pacific region”.
Rehabilitation and RTW presentation
Linfox Australia and Linfox Armaguard
•Armaguard has a proud history of
providing a wide range of cash
services to Australian business since
1938.
•In 2003, Linfox purchased
Armaguard. Since this time
Armaguard has developed from the
country’s leading Cash-in-Transit
Company to Australia’s leading
Currency Management service
provider.
•Has 47 branches nationally and over
3000 staff
•The vision of Armaguard is to
become the world’s leading currency
management company.
Rehabilitation and RTW presentation
“
The ‘Vision Zero’ focused safety campaign is aimed at
eliminating injuries in the workplace by creating a visible
safety culture and increasing site safety accountabilityLinfox Board and leadership team are absolutely
committed to eliminating workplace injuries (Tony Duhne
Linfox Asia Pacific SHEQ Manager)
“
Linfox Philosophy
• Linfox Australia and Linfox Armaguard are committed to the RTW of all
injured employees. This is supported by the CEO and Leadership Team
of both Linfox Australia and Linfox Armaguard and is demonstrated in
their continued investment in resources and innovation.
Rehabilitation and RTW presentation
Key Challenges in providing rehabilitation
services for Linfox employees
• The diversity of our sites across Australia/NZ, many in remote
locations
• The interface between the Linfox business and its key customers
• The cultural ‘stigma’ surrounding Workers Compensation claims
• Issues with limited access to rapid communication of information
• Some sites consist of a depot from which, drivers commence and
complete their driving runs with limited daily staff numbers actually on
site
• The physical nature of job roles across Linfox and Armaguard
involve a high manual handling component
• Light duties were not always readily available
Rehabilitation and RTW presentation
Solution
•
We created a:
– culture of early intervention within Linfox
– supportive process by creating innovative tools to increase site
engagement
– way to improve site based technical expertise
– philosophy of rewarding good behaviour to the bottom line
•
The solutions:
1. The ‘Charge Back’ model
2. Create an early reporting culture at Linfox
3. Development of a Linfox early intervention model
4. Development of site/branch based RTW ‘tools’
5. Development of a site based RTW pack supported by a National
education program for around 300 RTW co-ordinators
6. Adaptation of the Kaplan/Norton Balanced Scorecard (BSC) to
improve RTW performance
Rehabilitation and RTW presentation
1. The Charge Back/User Pays Model
Background:
• Historically all Linfox sites were charged an equal share percentage
of the overall annual estimate costs for W/C costs
• Charging the same WC costs:
– did not hurt the poor performers
– did not reward the good performers
– did not provide incentives to improve in areas such as injury
prevention or RTW through innovation
– would not drive cultural change
•A review of Global models was undertaken with a critical focus of
rewarding positive RTW outcomes straight to the P&L
•Our model was adapted from “The Hartford Loss Control
Department” in the USA, which includes a Safety component.
Rehabilitation and RTW presentation
The Charge Back/User Pays Model (cont..)
How it works:
•Allocating the costs down to a site/division/team based upon a
“user pays” philosophy
•When a site has a claim then they are immediately charged with
the estimated cost of the claim to their P&L
• We also reward sites for having less claims than the prior year
•Linfox adopted this to reinforce our safety culture and reward
those sites that focus on injury prevention
Rehabilitation and RTW presentation
The Charge Back/User Pays Model (cont..)
How it works:
•The Linfox Charge Back model is based upon 2 categories:
– Collection of a base levy (16%) which covers our costs only to
running our SI program and
– 84% is collected via a user pays model based upon actual
claims experience and costs
Rehabilitation and RTW presentation
The Charge Back/User Pays Model (cont..)
•The model ensures all sites who improve in RTW will see the benefit
to their bottom line.
• Report is written for commercial managers explaining charges and
encouraging RTW focus to drive outcomes
• Estimates are reviewed monthly and sites either get refunds or
charges depending on estimate movement. IE: it is a moving and live
target
• Sites and branches are notified on a weekly basis of any charges or
credits occurring that are greater than $10k.
Rehabilitation and RTW presentation
2. Create an early reporting culture across Linfox
Background:
• Early reporting will reduce claims costs and this is supported by
various international studies, no more powerful however than The
Hartford Study in 2000 & 2004 of > 50,000 claims which analysed
the impact on delaying reporting of claims to the cost. Their report
concluded:
– Claims reported in 2-weeks are 18% more expensive than
claims reported in 1 week
– Claims reported in 3-weeks are 29% more expensive than
claims reported in 1 week
– Claims reported in 4-weeks are 31% more expensive than
claims reported in 1 week
– Claims reported > 4-weeks are 45% more expensive than
claims reported in 1 week.
Rehabilitation and RTW presentation
Create an early reporting culture across Linfox
(cont…)
•How it works:
• Worlds best practice is 48 hours
• Linfox created an internal financial penalty to be imposed against
those sites for reporting of claims > 5 working days post incident.
• Penalties hurt and were reported as such in their general ledger
• The reason for 5 days is that Linfox average delay was a poor 30+
days prior to this initiative (crawl, walk, run)
• All penalties collected were reinvested back into the business to be
used on safety initiatives.
• Over 90% of Linfox claims are now reported within 5 days compared
to 48% prior to the introduction of this penalty provision
• We are now targeting 48 hours
Rehabilitation and RTW presentation
3. Development of a Linfox early intervention
model (cont…)
Background:
• Linfox had to change and we needed a new model that would enable
strong leadership at every level of management.
How this process works:
• Sites/branches demonstrate care and compassion for injured employees
• Site/branch contact demonstrate frontline leadership by: providing
transport for medical assessment
• Provide information to the medical practitioner on suitable duties
available at site (use of job dictionary)
• Provide information on workers compensation process
• Move information quickly to Rehabilitation experts and claims information
to claims co-ordinators
Rehabilitation and RTW presentation
4. Development of a National education
program and site based tools
Almost 300 sites and branches- Linfox Aust: 247 and
Linfox Arm: 47
•
The following innovative tools items were developed to assist site
RTW co-ordinators lead and manage the RTW processes.
4.1 RTW booklet
4.2 If you are injured at work poster
4.3 Job Dictionary
4.4 Employee guide to workers compensation
Rehabilitation and RTW presentation
4.1 RTW Booklet
4.1 RTW Booklet- A guide to help
injured workers understand the
injury management process
Background:
• The aim of the RTW booklet is to
provide:
– A reference guide for injured
employees
– A communication tool for sites
– A ‘handy’ reference guide for site
managers and RTW co-ordinators
Rehabilitation and RTW presentation
4.2 If you are injured at work poster
4.2 ‘If you are injured at work’
poster for all sites
Background:
• The need was recognised for a
visible procedure for injured
employees to follow if injured
How the poster is used:
• A resource tool for sitesparticularly the sites that have few
injuries
• Takes the site step by step
through the workers compensation
process
• Highlight’s key steps in process
• Gives a phone number to contact
for information
Rehabilitation and RTW presentation
4.3 Job Dictionary
4.3 Job dictionary
Background:
• Feedback from site RTW
co-ordinator’s raised the
issue that the sites were
having difficulty contacting
medical practitioner’s directly
to discuss suitable duties
that were available on site.
• Medical practitioners more
likely to respond to an offer
of suitable duties if there was
a description and picture of
the job tasks available.
Rehabilitation and RTW presentation
4.4 Guide to Workers Compensation
4.4 Claims Booklet- A guide to
help injured workers understand
the claims management process
Background:
• The aim of the Claims booklet is
to provide:
– A reference guide for injured
employees
– A communication tool for sites
– Information on the claims process
Rehabilitation and RTW presentation
5. Development of a National education
program for RTW co-ordinators
Background:
• A key component of our culture change strategy was to
communicate a consistent set of standards and expectations
across every Linfox and Armaguard site nationally.
• This occurred via a national training program.
Training focus:
• Legislation update
• How to use site and branch based tools
• The Linfox RTW model
• RTW co-ordinator roles and responsibilities
• Who are the key stakeholders
• Best practice early intervention
• RTW Pack and show-bag
• Case studies
• Medical terminology and RTW for common injuries
Rehabilitation and RTW presentation
6. Linking performance to a Balanced Score
Card (BSC)
Background:
• The introduction of these new initiatives and tools to facilitate
improved RTW also highlighted a need for better reporting within
the Linfox business.
• Linfox adapted the Kaplan/Norton BSC into the Safety &
Rehabilitation Operations.
• Harvard Business Review (HBR) selected the BSC as one of the
most important management ideas in the last 75 years, which
integrates the financial measures with other key performance
measures such as customer service, processes, growth, learning
and innovation.
• More than half of the Global 1000 Company’s have adopted the
BSC into their operations.
Rehabilitation and RTW presentation
6. Linking performance to a Balanced Score
Card (BSC)
How it is used:
• The Balanced Scorecard (BSC) is a
performance management framework
and defines what is important to an
organisation and ensures appropriate
metrics are measured, tracked and
reported.
• At Linfox 5 key dimensions were
defined:
– Strategic Development
– Financial Performance
– Customer Development
– Operational Effectiveness
– People Development
Rehabilitation and RTW presentation
6. Linking performance to a Balanced Score
Card (BSC) (cont…)
How it is used:
• Once measures have been documented
and annual targets set, reporting against
these measures commenced.
•
Linfox manage internal reporting by using
a “dash-board” and “cock-pit” concept
disaggregated down to various levels of
the organisation using “supplementary or
site dashboards”
•
Linked to the BSC are staff KPIs and
annual salary reviews to ensure a
consistent strategy is applied across all of
our operations.
Rehabilitation and RTW presentation
Our tangible results
Comparison of first yr in Comcare Vs. previous 12 months
1 day
incapacity
5 days
incapacity
30 days
incapacity
60 days
incapacity
Linfox
13%
decrease
10%
decrease
5%
decrease
18%
decrease
Armaguard
25%
decrease
43%
decrease
48%
decrease
65%
decrease
• These results are excellent and demonstrate clear improvement,
which has a direct link to our bottom line and LTIFR
Rehabilitation and RTW presentation
Our tangible results
•
Conclusion: Today’s talk comprised part of the submission that
was successful in winning the 2006 Commonwealth Rehabilitation
Award in the category of Rehabilitation/RTW
Rehabilitation and RTW presentation
Innovative solutions designed to
enhance site engagement, drive
cultural change and demonstrate
RTW commitment
Julian Hodder
National Workers
Compensation Manager
Confidential and Proprietary Information. © Linfox Australia Pty Ltd 2006. All rights reserved.