The “Intelligent Customer”

Like all businesses, safety-critical and complex organisations engage in fundamental strategic Make or Buy decisions. Core tasks and processes are undertaken in-house by the organisation (the ‘make’ element). “Non-core” activities are then outsourced to efficient third parties (the ‘buy’ element). Organisations increasingly use contractors to carry out certain activities.

The effective management of contractors has been highlighted in a number of adverse events across various high-hazard industries. Organisations need to retain the ability to understand, specify, oversee and accept technical work undertaken on its behalf by contractors.

The concept of Intelligent Customer (IC) in relation to high-hazard safety was developed by the UK Office for Nuclear Regulation (ONR: part of the HSE) and has gained international acceptance. It is the capability of the organisation to have clear understanding and knowledge of the product or service being supplied by a service provider.

“Intelligent Customer” is defined by the International Atomic Energy Agency (IAEA) as follows:

“As an intelligent customer, in the context of nuclear safety, the management of the facility should know what is required, should fully understand the need for a contractor’s services, should specify requirements, should supervise the work and should technically review the output before, during and after implementation. The concept of intelligent customer relates to the attributes of an organisation rather than the capabilities of individual post holders”.

The concept of Intelligent Customer applies to all safety-critical, complex, or high-hazard organisations. In demonstrating that the Intelligent Customer criteria can be met (for example, to a Regulator), an organisation should:

  • be able to make informed decisions relating to high-hazard safety issues;
  • remain in control of all work carried out by contractors that can impact on high-hazard safety issues;
  • maintain oversight of work with high-hazard safety implications, whether that work is conducted on or off-site;
  • have a clear policy for choosing between in-house activities (‘make’) or the use of contractors (‘buy’);
  • have considered whether the use of contractors could create organisational vulnerabilities arising from a dependence on contractors in relation to high-hazard safety issues, and have in place contingency and succession arrangements;
  • be able to demonstrate that its core capability has suitable and sufficient competence, resource and arrangements to understand where and when work is needed; specify requirements to carry out that work; understand and set suitable standards; supervise and control the work; and be able to review, evaluate and accept the work carried out on its behalf.

A key question is: “Could you do the work yourself if the contractor was to disappear?”. Furthermore, when was the last time you actually did such work yourself?

Intelligent Customer Capability and Safety Cases

It is not unusual for high-hazard organisations to contract-out the writing of safety reports and safety cases. The ONR Guidance on this issue states that:

“The licensee must be competent to ensure that the contractor is suitably qualified and experienced, follows an appropriate methodology, and uses the correct data and assumptions. The licensee should have sufficient knowledge to understand the limitations and implications of the analysis to its safety case; to question and challenge the contractor’s work; and to show that it has applied an appropriate degree of oversight in practice. The licensee should be able to lead the presentation of the safety case arguments. However the licensee need not necessarily have the depth of knowledge required to undertake the detailed analysis itself” (ONR, 2013).

A high-hazard organisation needs to be able to understand not only the information in the safety case/report, but also what is not there and to know what should be there. It has to be able to recognise the strengths and weaknesses in the Case and how these will change over time, or when new problems arise. It has to be able to integrate the reality on the facility with the assumptions and requirements of the safety case – and spot the discrepancies.

Any implications of losing Intelligent Customer Capability?

If it is judged that this capability is lost, the organisation is in danger of losing – or has already lost – the ability to understand the facility safety case. As a result, the ability to operate the facility safely is called into question. This is therefore a key aspect of retaining a ‘Licence to Operate’ from the appropriate Regulator. For example, see the discussion on the Nimrod Safety Case.

Relationship with other human factors topics

This topic has clear links to organisational change, staffing levels, competence, supervision, communications and learning organisations.

Further guidance on the “Intelligent Customer”

Licensee Core and Intelligent Customer Capabilities, Office for Nuclear Regulation, (ONR, 2013). NS-TAST-GD-049 Rev4. This Technical Assessment Guide considers assessment of the technical and safety assessment capabilities in the context of the intelligent user of technical services, safety advice, safety information and assessment. Although produced for the nuclear industry, this guidance contains useful principles for any organisation, particularly major hazard industries.