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Colonial Pipeline: A Safety Success Story

"Safety is Our First Priority:" Colonial Pipeline's Journey

By: Susan Castiglione Baranski, Senior Manager, Corporate and Public Affairs, Colonial Pipeline Company

For 30 years, Colonial Pipeline had been a giant in the refined petroleum products pipeline industry. Large in size and influential in the industry, the Colonial system runs from Texas to the New York Harbor, includes over 5,500 miles of pipeline and delivers over 96 million gallons of product per day, including gasoline, diesel fuels, home heating oil, and jet kerosene. Since the early 1960s, Colonial management had run the pipeline hard and met the demand for increased transportation of products over the decades of the '70s and '80s. Then, little by little, things began to change.

By the mid 1990s, Colonial had experienced several large spills of product from its lines. These ruptures were located at various points along the Colonial system, and had caused environmental damage as well as loss of product and revenue for the company. While no one at Colonial was uncaring about the spills, effective solutions to stop the incidents were simply not found.

Then on June 26, 1996, an event occurred that was to forever change Colonial Pipeline Company. Shortly before midnight, a pressure surge caused a large rupture on the Colonial system, releasing approximately 22,800 barrels (or 957,600 gallons) of diesel fuel into the Reedy River in South Carolin . For the federal regulators, safety investigators, environmental protection agencies, and a host of others - including Colonial - this incident was the straw that broke the camel's back. It seemed from outside eyes that safety was not valued at Colonial Pipeline. The federal government's reaction was significant in scale and included multi-jurisdictional accident and safety investigations for violating the Clean Water Act, followed by criminal and civil lawsuits that ultimately led to a Colonial criminal plea to misdemeanor negligence.

That day in 1996 was indeed a watershed event for Colonial. Even before the enormity of the federal government's reaction was fully understood, the Board of Directors at Colonial knew things had to change. November of 1997 saw that first big change for Colonial. David L. Lemmon, then President of Amoco Pipelines, left Amoco and joined Colonial as President and Chief Executive Officer. Six months later, in June of 1998, Lemmon brought Bill Scott from Conoco to Colonial as Chief Operations Officer, and the two got to work.

"With Bill now at Colonial to work with me to lead change, I knew we needed to raise the bar in safety and system integrity, develop the concept of operational excellence for the organization, and then push ourselves and the organization to reach for and achieve our new standards," stated Lemmon. "1998 and 1999 were years when we launched a two-pronged attack. Bill focused on the operations of the pipeline, made huge changes, and led our pursuit of excellence. I took hold to create a new leadership and senior management team plus a strategy that would define a broader vision for Colonial and our future. I needed the leaders and the strategy to bring fire to Colonial so we could make huge leaps forward - fast."

Frustration was found throughout the organization. The "Colonial" way of doing things had developed over the years, and for some employees there was no need or desire to change "the old ways." For Lemmon, Scott, and many others, however, there was a huge burning platform for change. The criminal plea bargain with the federal Department of Justice required immense process and procedural revolution for Colonial. The company's reputation was tattered, and other companies were reluctant to do business with Colonial. Perhaps most compelling for many Colonial employees - the company that they believed in and worked diligently for would be brought to its knees if another major incident occurred.

Safety became a way of life for all Colonial employees. Keeping the product in the pipe, protecting the Colonial communities, preserving the environment, and sending everyone home safely at the end of each day became the mantra. Accidents were no longer allowed to be seen as inevitable; the new leaders began sending the message that all accidents are preventable. But there was a long way to go; and cultures, beliefs, and behaviors don't change easily.

Lemmon and Scott knew that the only way to turn the company around was with the assistance of the employees, so the communication and involvement of as many along the entire pipeline as possible began. A Trust and Communication Committee and an Operations Council were established to bridge the gap between management and the line organization to understand challenges, concerns, and fears. Employee forums, both inoperations and at the corporate level, were established to help create the shared vision and commitment necessary for culture change and success.

In 2000, the old Colonial Mission Statement was retired and replaced with new Mission/Vision/Values, "Our Journey to Excellence," written by a consortium of employees, and endorsed by the Leadership Team. Commitment to safety was so manifest in Colonial employees even by then that the first of the values states:"We value safety and protecting the environment as we do our family and home."

Scott convened the Operations Leadership Team, the senior managers in the operations functions of Colonial, to develop new philosophies and raise the safety and system integrity bar even higher; then to work as a team to move Colonial operations to new standards. Tim Gross, Control Center Manager during the early years of the Colonial effort, recalled one very crucial moment for Colonial. "In the past, volume was king. Colonial's way of operating the system was 'confirm you had a problem before you shut down the line.' Bill had been preaching to us that both he and Dave were committed to 'if in doubt, shut it down.' The first time a controller put that to the test, we all held our breath. We took the line down, then began confirmation of problem or no problem while I swallowed hard and called Bill. He thanked the controller for doing the right thing. Right then, we knew it was going to be different."

The Operations Philosophy, written by the Operations Leadership Team, defines safety as Colonial's core value, and states: "Colonial is accountable for its actions and will not compromise the integrity of its operations for financial gain. Colonial is committed to operational excellence and to the safety of the public, the environment and its workforce. This commitment is total. Colonial will continually strive to improve its operations in order to achieve spill-free, error-free operations."

Darren Pruitt, a Colonial Operations manager, puts perspective on the change in Colonial employees' beliefs about safety and its importance to Colonial. "Previously, Colonial thought it had a decent safety program. In 1995, our safety goals were:

  • Target - 16 OSHA (Occupational Safety and Health Administration) recordables,
  • Target - 5 lost workday cases, and
  • Target - 9 "preventable" vehicle accidents.

For 2002, our safety goals were at levels that we had thought were out of reach:

  • Target 1, Stretch 0 - OSHA recordables,
  • Target and Stretch 0 - lost workday cases, and
  • Target 6, Stretch 4 - total vehicle collisions.

These goal comparisons and our assessments of these numbers are both staggering and stunning, and what is equally amazing is how we changed so much in such a short timeframe. We are achieving results that most of us said were impossible five or ten years ago."

Dealing with the uncertainly felt by employees during times of organizational stress and change is important for any company if it is going to succeed and achieve its goals. Rhonda Brandon, Human Resources Vice President, who joined the executive team in 1998, knew that the company needed to tap into the skills, capabilities, and mindsets of the employees to successfully move the safety bar higher and higher. "The performance and capabilities of our employees throughout the organization were necessary components in the safety, system integrity and operational excellence improvement efforts we had to make," stated Brandon. "We began developing people processes to align performance and behaviors with the renewed company direction. As Colonial continues to move forward, we must continue to provide development and training opportunities to support the changing safety culture and higher levels of performance."

This internal dedication to turning Colonial around began to be noticed outside of the company early in the new century. Because the uncertainties around power supply and computer reliability were significant, Lemmon made the decision to proactively shut the Colonial system down while the world transitioned from one century to the next. With Scott's advocacy, Lemmon announced this in September of 1999, astounding much of the industry.

"Dave made the absolutely right decision for the Colonial system," stated Scott. "We knew we could ensure the safety and integrity of the pipeline regarding what we could control at Colonial, but there was so much beyond our control - especially with the power grids and computer reliability questions - that we believed the right thing, the safe thing, was to shut down Colonial. So we did."

After a few hard years of pulling itself up by the bootstraps, the Colonial door was opened to critics and regulators from governments and communities. Then NTSB Chairman and vocal Colonial critic, Jim Hall, was invited to Colonial, to hear from executives and employees, review changes and new standards, see the operations of the control center and other major facilities, and offer any input he might have. Hall asked leaders and employees questions, reviewed processes and changes, and shared lessons and philosophies with Colonial.

"It is no secret that I was once very condemning of Colonial. The Reedy River spill was, in my mind, a clear demonstration of an irresponsible company," stated Hall. "After the management change at Colonial, I sat in my office in Washington and listened to Bill Scott promise me 'never again' and I was very, very doubtful. But as I watched the record of the company change, and then visited Colonial to see for myself what was happening, I began to believe." Others did, too, as 2000 turned to 2001 and the improvements continued.

The American Petroleum Institute (API) initiated an industry award in 2001 for Distinguished Pipeline Operator. Designed for the liquids pipeline industry, eligible companies are evaluated by a group of industry representatives, based on environmental and safety records as well as community involvement. When the award was created, API set the standard that it was only to be given out if the review committee determined a pipeline deserved this recognition. In 2001, for the year 2000, Colonial met the criteria to apply, and became the first recipient of the API Distinguished Pipeline Award. The first 'eagle,' the symbol chosen by API for this award, came home to roost at a very humble and grateful Colonial Pipeline.

This success and external recognition spurred Colonial employees to even greater desire for safety and zero accidents. Perhaps the 'low-hanging fruit' on the safety and operational integrity trees had been harvested, but everyone in Colonial knew the drive for improvement could never let up. Colonial needed to drive personal safety to even greater heights, and completed a culture assessment to help find ways to raise the bar again. The design of the assessment was to identify areas where the company could be at risk of slipping back from its outstanding progress, as well as areas where additional improvements were necessary.

"I believe it is easier to climb the steep hill - and I'm speaking of an organization that is in crisis and needs to get out of it - than it is to sustain performance, particularly excellent performance," stated Lemmon. "So there we stood at the top of the hill, and I looked around thinking, 'it will be very hard to stay here.' But I knew we had to. Safety, environmental preservation, and operational integrity are indeed the price to play in today's liquids pipeline industry."

The Safety Culture Assessment did find room for additional work, and a cross-functional Safety Guidance Team was chartered to review safety practices, procedures, approaches, and philosophies. Made up of employees from the front line to management across the pipeline, the Team was given free rein to review, rewrite, re-develop, validate and propose improvements. Five months of intense, detailed work resulted in a renewed approach for safety at Colonial. Included in the Safety Philosophy - the first for Colonial - is the recommitment to what had become a powerful motto for Colonial:"We believe that all accidents and injuries are preventable."

As Colonial's plans to renew its safety culture were rolling out to the organization, work began on the Colonial submission for the API Distinguished Pipeline Award. Perhaps there was symmetry in those efforts, because when the awards ceremony had concluded for 2004, Colonial had been, for the fourth consecutive year, honored with the 'eagle.'

"We are not done," stated Lemmon. "Colonial - and I believe this to be true for all in our pipeline industry - must continually set the safety and system integrity bar higher for ourselves, then do whatever it takes to reach those new goals and renew our dedication to operational excellence. We must do this, simply because it is the right thing to do. For the liquids pipeline industry, there is never a place where a company is 'safe enough.' For Colonial, we will find ways and methods to continue to improve our safety and system integrity right where we have found our past success: in our employees. Colonial's journey never ends."

* * * * *

Wednesday, September 8, 2004



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