Wednesday, June 06, 2007

Science vs. Finance

An argument for ergonomics prevention ...

"I believe there is a substantial difference in the standards of proof in finance and science, and this is responsible for a significant misallocation of resources in industry today. It is part of the story of why ergonomics is not utilized to maximize shareholder value.

Much of the energy behind widespread adoption of ergonomics as a prevention tool for work-related musculoskeletal disorders has been driven by the Occupational Safety and Health Administration (OSHA), mostly through the general duty clause. When the Bush Administration decided not promulgate an ergonomics standard, many companies seemed to turn their backs on ergonomics. Much of the argument over general duty citations and the ergonomics standard have revolved around whether there is a scientific basis for injuries being caused by biomechanical factors. Thus, the argument has been a combination of politics and science. As such, opponents of ergonomics have focused on weaknesses of study designs and held research reports to the standards found in the medical science literature.

However, I argue that this standard is quite higher than what a profit-maximizing agent such an investor or business use in decisions to allocate capital. Therefore, the entire ergonomics policy debate is irrelevant to the question of whether firms can maximize profit by carefully and thoughtfully applying ergonomics . Thus, when many businesses walked away from ergonomics after the demise of the ergonomics standard in 1999 they abandoned the opportunity to make money by wisely investing in ergonomic interventions.

This belief is the motivation for the ErgoBenefit project. It is intended to help guide business decision makers in making money through ergonomic investment."    (Continued via Ergonomics Economics)    [Ergonomics Resources]

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