Safety at Fluor Hanford (A)
Fluor Corporation has always prided itself on its competence in safety. It was a core value of the company, and Fluor had achieved remarkable safety records on complex projects all over the world. But now, in the spring of 1997, Fluor found itself managing the Western Hemisphere’s largest environmental cleanup site, the Hanford reservation in Washington State. The Hanford site was established as part of the Manhattan Project in the 1940s that gave birth to the atomic bomb. Hanford produced nearly two-thirds of U.S. plutonium during the Cold War period. The Hanford site was half the size of Rhode Island, occupying 586 square miles in southeastern Washington State. The cleanup that began in 1988 was expected to take 30 years or more.
Improving safety at Hanford was proving to be a significant challenge. As the new site manager at Hanford, Fluor Hanford (FH) inherited lower- and mid-level managers and thousands of unionized employees, many of whom were second- or third-generation Hanford employees. These employees had seen many contractors come and go over the previous years. Some of the managers who had worked with the previous contractor saw Fluor’s emphasis on safety as getting in the way of operations. Union/management relations were fractious. Hanford’s culture was described as “production driven—management told everyone what to do, and, if you didn’t do it, there were consequences.” Worker involvement in designing and implementing safety programs was negligible. FH also was having trouble satisfying its client, the U.S. Department of Energy (DOE).
The Safety at Fluor Hanford (A) case is set in 1997 not long after Fluor arrived at Hanford. The Safety at Fluor Hanford (B) case describes the changes that were made and the improvement in the safety record. The cases can be used in several different settings: (1) to examine change management in an organization with a deeply engrained culture; (2) as a safety management case; and (3) as a case that explores a government contracting scenario.
Our primary use of the case is in change management. The objective of better safety cannot be disputed (nobody will argue that they want a worse safety record). However, Hanford does not have a good safety record, so change is necessary. The unique aspect of the change situation is that Fluor, as the new contractor, inherits an existing culture shaped by middle management and a unionized workforce. To create successful change, Fluor will have to engage both the middle management and the workforce. Creating culture change as a new contractor will be a significant challenge. Students need to be pushed to get beyond jargon like “increase empowerment of the workforce” and identify specific changes that can be implemented.