Tragedy to triumph Featured

8:00pm EDT July 28, 2006
It’s a situation no CEO would want any part of, but Don Morel Jr. faced it with less than a year on the job.

No one knows exactly what caused combustible dust inside a drop ceiling to ignite at West Pharmaceutical Services’ Kinston, N.C., plant three years ago. Unbeknownst to workers at the plant, the dust — a product of the plant’s production of rubber stoppers for syringes and intravenous tubes — had been settling on hard-to-access surfaces for years. Early in the afternoon of Jan. 29, 2003, the dust caught fire and exploded.

The explosion ripped through the plant, sending smoke and debris hundreds of feet into the air. Six workers were killed, and almost 40 were injured.

In a matter of seconds, West’s Kinston plant had gone from a working cog in West’s worldwide production machine — one that garnered $700 million in sales in 2005 — to a scene of death and devastation.

For Morel, it was a test of the strength of his leadership, and a test of the loyalty of his employees.

Employees first
When news of the explosion hit West’s headquarters, a response plan needed to be formed, and quickly. Morel — CEO of the Lionville-based pharmaceutical packaging and medical device manufacturer since April 2002 — was thrust into a worst-case scenario.

He had to pilot his company through a disaster with less than a year of experience in the top post, and he learned an important lesson right off the bat.

“The major lesson was, get your priorities straight,” he says. “We arrived in Kinston late, and I sat down with the management team that very night.”

Before looking at a disaster through the lens of business, Morel says the first thing a CEO needs to do in this situation is look at it through the lens of the people affected. The workers and their families need to be taken care of first.

“The first priority is the employees, their families and the community,” he says. “We never deviated from that, and that served us well as kind of our guiding principle for decision-making going forward.”

Focusing on the comfort and welfare of those most directly affected by the explosion was a logical first step, Morel says. In a crisis situation, employees have to see that their company is concerned about them and is willing to take steps to stabilize the situation.

Once that is done from a human standpoint, then a company’s leaders can set about addressing damage done to the business itself.

The day after the explosion, Morel says West representatives sat down with every employee at the plant and outlined the company’s plan for the coming weeks. To give employees an added sense of security, West’s leaders told them they would continue to receive their salaries and benefits for a month or more, even with the plant shut down.

And they set up a phone number for injured workers and their families to address questions regarding pay or benefits.

Within a month, West began making arrangements to get some employees back on the job. With Kinston’s facility disabled, the only option was temporarily relocating about 120 employees who volunteered to work at plants in St. Petersburg, Fla. and Kearney, Neb., which were helping to pick up the load of the Kinston plant.

That posed another set of challenges as people were uprooted and moved. Workers with lives already in a state of upheaval were now being asked to relocate hundreds of miles from home and live in two-to-a-room, dormitory-style arrangements at motels.

West’s leaders tried to combat homesickness rotating the relocated workers in and out, several weeks at a time, allowing them to return home at regular intervals.

West also set up a support program at the Florida and Nebraska locations, pairing relocated workers with the family of another West employee. Usually, Morel says, the worker was paired with a family with similar interests.

“For example, if they liked to fish or liked to work on cars, that’s who we tried to pair them with,” Morel says.

The program was voluntary for both the workers and the families, and host families received no added incentives, Morel says.

Business second
After employees, Morel’s second priority was making sure the company didn’t miss any orders. That was a formidable task, considering that the explosion had robbed West of about $30 million in production capacity.

Morel says West’s leaders quickly decided to divide Kinston’s production load among four other plants. The plan worked, and West did not miss a single order in 2003, Morel says.

“We were late on a couple of orders as we relocated and built capacity at those four sites, but it was a remarkable story in that we did not miss a single order,” he says.

Morel says West attempted to salvage what it could out of the Kinston plant and make use of it at other facilities. Undamaged finished goods were shipped to customers. Raw materials and other goods were shipped to some of West’s other factories around the country.

Additional workers were called in to the other sites. On top of the relocated workers, temporary employees were hired, and ormer employees were brought out of retirement. Production was increased to 24 hours a day, seven days a week.

Morel says the ability to maintain production after the explosion showed workers and managers alike exactly what they were capable of under adverse circumstances.

“I think the principal impact was showing people what they are capable of,” he says. “It made us all say, ‘Wow, look at what we’re capable of when things are really difficult.’”

The explosion caused West to change its production philosophy slightly, Morel says, emphasizing redundancy to its customers and attempting to get them to validate more than one site for their products whenever possible.

“Often on the pharmaceutical side, when they put their drug application in to the FDA, they need to include the sourcing of all their critical components,” he says. “We try to get them to qualify multiple sites so that they have minimal risk if an event like this happens.”

Safety matters
Although the accident was not a direct result of the production processes, Morel says the event provided a chance to update and refine its safety policies.

“We have changed the way we train our employees relative to handling materials that are potentially explosive and the way we actually analyze materials that are used,” he says.

Potentially dangerous materials must now pass through an in-house hazardous material review board and are reviewed by an external team of engineers and safety experts.

“The board assesses the hazards of dealing with each material,” Morel says. “In addition, our engineering group evaluates the risks associated with the way the materials will be processed.”

The cleaning procedures in West’s plants have also been modified. If hazardous dust is present, Morel says the company strives to make sure the best systems are in place for cleaning out the dust. If there are hard-to-access surfaces where dust can accumulate, they are removed them whenever possible.

“It’s a whole series of things in response to what we learned from the [post-explosion] investigation,” he says.

Morel has learned that a company that handles hazardous material must always be aware of the risk level and regularly re-evaluate the evaluation process.

“Investigate your processes for evaluating risk associated with your materials and processes,” he says. “This particular risk was explosive dust, but we were unfortunately not aware of the danger because the MSDS (material safety data sheet) did not warn of explosive risk.”

Media spotlight
The disaster at Kinston could have placed a black mark on West’s reputation that may have taken years, maybe decades, to erase. But West was able to rebuild its reputation quickly, and Morel credits management and employees’ handling of the media exposure after the accident as a major reason why.

A catastrophic event can bring unwanted media glare to a company. Cameras captured the devastation to West’s plant, and satellites beamed the images around the world. Questions about West’s safety practices were coming from all directions.

It didn’t help matters that West received a series of Occupational Health and Safety Administration violations in the fourth quarter of 2002. Morel says the national media hammered West for the OSHA violations in the aftermath of the explosion, although there was no connection between the violations and the explosion, he says.

“All the issues raised were taken care of within a period of several months,” Morel says. “They were simple violations, like we didn’t have load-bearing plates on some of the beams in the plants.”

To keep West’s media comments straightforward and consistent immediately following the accident, Morel limited media interaction to a small group of administrators who were kept constantly abreast of the latest developments.

The morning after, major television networks aired an interview with Morel in which he communicated the priorities that had been established by company leaders right after the explosion.

“The message about our three priorities was actually telecast on the national networks at 6 the morning after the accident,” he says. “All the networks picked that up. I told them, No. 1, employees, families and community; No. 2, customers and supply; No. 3, those aspects of the business we can control.”

Inevitably, the media sought out the Kinston employees and their families. Those people most affected by the explosion, however, turned out to be West’s biggest supporters in front of the cameras, giving the company’s image a major boost when it was needed most.

Morel credits much of the positive employee response to the company’s emergency training.

“The employees very pointedly stated that West was a company very concerned with employees, and nobody would have been working in unsafe conditions had the company known about the situation with the dust,” Morel says. “And that’s absolutely true. They consistently commented about the training they received. Many credited their training with the ability to escape in the darkness and the confusion immediately after the accident.”

In the weeks and months after Kinston, Morel says he and other company leaders embarked on a tour of West’s North America plants. They spoke to employees, answered questions and tried to rebuild confidence within the company.

As time went by, their initial efforts began to bear fruit. West recommitted to Kinston, opening a new plant in 2004. By mid-2005, the plant was running at full capacity.

And although the company has recovered, Morel cautions that CEOs shouldn’t wait for a crisis before reacting. By being proactive and keeping employees informed and their training up-to-date, management will be well-served in the long run, no matter what is around the corner.

Morel, who was also named the company’s chairman in March 2003, says it’s a big reason why West gathers all of its production facilities around the world for a company conference call three or four times a year.

“We communicate where the company is going, what the opportunities are, what the challenges are for us in the future, and it really is a strong motivator for everybody,” he says.

“Post the accident in Kinston, we had people who were naturally concerned about the company’s future, but the morale in the company is now extremely high. People are very excited about our future, and it all comes back to communication. It’s very critical to the employees because it comes back to the quality of their work life inside the company.”

HOW TO REACH: West Pharmaceutical, www.westpharma.com