Don't Overlook This Crucial Business Function If You Want Your Startup to Succeed When entrepreneurs get overwhelmed, workplace safety falls to the bottom of their priority list. Here's why that's a bigger issue than you might think.
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Entrepreneurs are overwhelmed by challenges. They have to build a product with a great product-market fit, raise capital, assemble a harmonious and high-functioning team, secure supply chains at reasonable prices and build a process to run their business effectively, all while trying to make a profit. One aspect of running a business that is often neglected is workplace safety.
It's a matter of duty
Workplace safety is vital from a human point of view. As the founder of a business, it is your responsibility to ensure that your workers and anyone who enters your facilities are safe. Before commercial considerations, there are considerations of duty. If you look at the most admired business leaders in the world, they all have a sense of duty toward their shareholders and their workers. Workers look up to such leaders and want to work under business leaders who reflect those values or service and duty toward the business.
It's a regulatory requirement
It is important to comply with Occupational Safety and Health Administration (OSHA) guidelines because failure to do so can lead to heavy penalties. This is why every business is encouraged to have some kind of OSHA safety training to ensure regulatory compliance. OSHA standards apply to all businesses regardless of size or sector.
The nature of the guidelines might vary, but your business at a minimum needs to provide adequate safety training and visible signage placed strategically across the premises, among other things. If your failures to adhere to OSHA guidelines are extreme enough, your business could ultimately lose its license.
Workplace safety enhances productivity
Startups are even more reliant on their workers than big companies because startups do not have the resources to scale. Each worker is tasked with doing much more than they would under normal conditions. Workers in startups are more likely to be multifunctional than those in established firms.
Given the pressure that each worker is under, they should feel confident within their workspace if they are to work quickly and productively. If they are plagued with doubts about their well-being, they will focus more on securing their safety than on enhancing their productivity.
Research shows a strong link between work conditions such as workplace safety and productivity, with researchers saying that "physical, organizational and psychosocial conditions at work contribute directly to worker safety, health and wellbeing, and influence enterprise outcomes such as turnover, absence, productivity and healthcare costs". Another study noted that "employees' safety and health are of primary importance, as both are key elements in achieving an organization's desired productivity and efficiency."
It helps create a happy workforce
Workers respond well to working environments where it's clear that management cares about their welfare. When it is clear that management does not care for their welfare, you run the risk of breeding dissatisfaction among your workers and losing some of them to your competitors. By working hard to improve workplace safety, you create the conditions for your workers to give their best to the organization.
Having these efforts in place will create a productive and positive culture around your business. Poor workplace safety is a signal to workers that management is indifferent to their welfare and poorly organized. Bad management will ultimately lead to legal liability and bad decision-making in other aspects of the business.
A company burdened with legal liabilities will have to shell out heavily on liability insurance as well as worker's compensation, and this ultimately reduces its value. The value of a business is the sum of its future cash flows, and a business that workers see as destined to make lots of payments to deal with its legal liabilities is not a business that will thrive.
You will notice that companies with issues of workplace safety also suffer from issues of absenteeism and productivity. This is a massive downside that results from being tight-fisted about workplace safety.
Now, when a company puts a premium on workplace safety, that tells workers that management not only cares for them but is unlikely to make decisions that will result in legal liability or threaten the existence of the firm. That is the kind of positive signal that motivates current workers and makes it easier to hire new ones.
It limits your liability
If one of your workers is harmed in some way while on your premises, or doing company business, that creates an immediate liability if that is due to workplace safety issues. Even if, for instance, a worker did something wrong out of ignorance, that raises an issue of the adequacy of safety training within the organization.
With cash flow such a serious issue for startups, it makes no sense to create conditions that threaten cash flows.
Poor workplace safety standards can lead to huge legal bills and settlements that might even threaten the existence of your business. Rather than allowing an existential threat to persist within your business, it is smarter to eliminate that risk and work to improve workplace safety.