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A Case in Support of SaaS for Environmental Information Management

Aerial views of the neighborhood surrounding a West Texas fertilizer plant that erupted in anexplosion is gone as visible April 19, 2013, two days after the blast. McLennan County Sheriff said the area surrounding the destroyed fertilizer plant is a highly populated neighborhood. He described it as "devastated" and "still very volatile." Ammonium nitrate - commonly used as fertilizer is believed to have caused explosion but investigation is till under way.

Posted by Neno Duplan

Last week we witnessed a huge explosion at a fertilizer plant in West Texas. The event was well covered in the media and some truth is slowly emerging on what was the main cause of the explosion.  Based on a Reuter’s news release, it appears that the plant was storing 270 tons of ammonium nitrate, or 1,350 times the amount that would trigger oversight by the U.S. Department of Homeland Security. From other preliminary reports, it also appears that the plant did not have a comprehensive monitoring and reporting system in place.

Safety advocates and some regulators are now questioning whether such facilities are adequately monitored and are calling for new regulations. Although the level of inspection of chemical facilities nationally may be low, there are plenty of regulations in place. If these were followed, the likelihood of incidents like this one in Texas would be reduced.  In this case, a proper reporting of the plant chemical inventory probably would have started authorities down the path of taking a closer look at the facility’s processes and practices. I don’t believe we need more regulations.  What we do need instead is a system for better data management and reporting based on existing regulations.  And this is where source of, and solution for the problem is to be found

The public’s fear and uncertainty concerning management of industrial complexes that store toxic, explosive, and other chemicals that pose a threat to human health and the environment is understandable owing to a lack of information on how these materials are managed and reported at such facilities. To date, the focus of the crisis at West Texas, rightfully so, has been on dealing with the consequences of a major explosion that killed at least 14 people and injured more than 200 others, and caused a huge material damage. Very soon attention will shift to answering the key question: Why this happened? Could this accident have been prevented?

At this point, an opportunity exists for US regulators and companies with similar plants to get out in front of the crisis and become as transparent as possible about managing compliance, waste, chemical, and environmental data at their plants. But will they do it is another matter. I would argue it is in their best interests to do so to as such an action on their part will go a long way toward lessening a repeat of such incidents elsewhere. The quickest and most effective route to a transparent reporting system would occur if all relevant data for a facility would be brought together and stored in a centralized information management system that is accessible to all stakeholders, including regulators and the public. The web makes all this not only possible but quite doable and many forward looking companies are already embracing this approach.

Deploying a centralized environmental management system to the “cloud”, and placing all applicable data in it, would allow all interested parties to know where various chemicals are stored and in what quantities, whether they are compatible with each other,  where samples of various media have been taken, what parties collected them, how the samples were analyzed, what the levels of various chemicals were in these samples, and what the legal limits and long-term effects of each chemical of concern are.

Evaluations about immediate as well as long-term risk, and any efforts to minimize these, must be based on the existence of good data, and these data must be accessible to be evaluated properly. This is the primary benefit of any cloud-based system that is responsibly managed. The general public is unlikely to have the sophistication to deal with most of this data. Rather, valid conclusions as to the impacts of the contamination are only likely to be drawn by regulators and those experienced in environmental regulations, statistics, modeling, risk assessment, and/or health physics.

But in today’s world, it is almost alarming to observe the laissez-faire posture toward information management that many companies have adopted. Over the last 15 years my company has been pioneering a Software as a Service (SaaS) approach for managing mission critical environmental and compliance information at the enterprise level. We have been slowly gaining market share, but the road has not been easy. The resistance from mid-level management for any change in how compliance information is managed is formidable and often leads to no decision at all, thus perpetuating the status quo—typically a spreadsheet-based solution.

What is interesting is that this situation is not limited to only some segments of the industry or some small companies. It exists everywhere, from very small companies to Fortune 50 companies. It also does not matter in what industry the companies operate.

In my role as a CEO, I have had the opportunity to talk with many executives and managers about their companies’ approaches to environmental information management.  What I have found at times ranges from alarming to incomprehensible.  One of the world largest and technology companies from Silicon Valley, for example, is running its compliance management on spreadsheets.   At another industry behemoth, perhaps one of the most respected companies in the world and one that advertises itself as “green”, its head of Environmental Health and Safety told me that his “company would be better off destroying all our environmental records than organizing them in the database. We get nothing out of this data but the trouble of reporting and more reporting.”

The majority of companies still elect to have their data housed in their consultants’ offices, thus resulting in a widely dispersed set of silo systems and/or spreadsheets that are often not accessible to the companies themselves.  This frees companies from the burden of managing their own data but more importantly, makes it incredibly difficult for not only them, but any outside entity to get a clear picture of their environmental practices and liabilities and compliance with existing regulations. This “bury your head in the sand” approach is one of big obstacles for SaaS based systems.

Companies that are forward looking make a serious effort to automate the management of their environmental and compliance information. The systems they use to do so are not inexpensive and generally take many months and cost hundreds of thousands of dollars if not more to implement. But the payback to companies that do implement them is always far greater than their costs (in millions of dollars over lifecycle of long term monitoring programs), especially given that any savings identified would not just be a one-time occurrence to prevent deadly accidents,  but would also continue to be experienced year in and out.

Some may claim that I am biased as I am head of a company that offers this type of software.  But we are not in the business of selling consulting services to build these types of systems.  We gain more by helping customers reduce their operating costs and long term liability than by selling them consulting services or trying to do so.  Implementing a SaaS-based compliance management system should not cost companies a penny of new money—it often can be funded instead from the elimination of the significant embedded inefficiencies that occur when these programs are run in a decentralized way, often on spreadsheets.

Only a comprehensive monitoring and reporting system integrated across different regulatory frameworks and monitored media could help prevent future disasters of type experienced in West Texas. Companies with similar plants like West Texas should ask themselves a question: Where is my reporting data? Who controls it? Do I own it and can I prove to regulators in real time that I know what is happening at my facility?  I think everyone in the chemical, oil and gas, and other high risk industries should take a hard look at this incident and ask of their management is it worth it to continue procrastinating on whether to acquire a centralized compliance and environmental management information system (EMIS).

Companies should remove decisions on whether to have a central compliance system from plant managers to C level executives.  Plant managers should be responsible to execute the system that the company has selected, much like ERP systems are selected and managed today. We are living in the era of Big Data and Big Data requires Information Management Systems designed to manage Big Data. Too many companies are flying blind and relying on spreadsheets!  Compliance, EMIS and related data must be in the Cloud. Why? Because even if the West Texas plant had the best information management system on its premises, it would be of little help today as it would have been blown up along with the plant itself, just like at Chernobyl, the BP Oil Platform in the Gulf of Mexico, or Fukushima.

The time is ripe for Government to mandate and industry to embrace Cloud-based systems for Environmental Information Management. Some smart companies have already moved in this direction but many are procrastinating.  If consumers and social networks have done it, why is it that the corporate world is lagging behind? If we did not have a “social network” in place would we have solved Boston Bombing so quickly? West Texas was much more devastating disaster in terms of life loss and, unfortunately, we may never find the ultimate cause of the accident if all the relevant data is gone.

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