| by Denise Robitaille
During the early 1990s, companies discovered a new criterion for ranking and qualifying suppliers. Salespeople found a new marketing tool. Quality professionals found support for the practices they were trying to implement. Some folks just found a lot more paper. Whatever their experience, companies large and small, representing all aspects of industry, were implementing a new quality program called ISO 9001--the latest "next big thing."
The hype proved to be a double-edged sword. The near mania that drove the implementations and propelled ISO 9001 into the marketplace also colored the quality management system (QMS) standard with the tinge of a passing fad.
Many of us--quality system managers, coordinators, auditors, consultants, trainers and implementers--held our collective breath, waiting to see if the concept of this QMS standard would sustain itself in the global marketplace. Would ISO 9001 just fade away? Would all the progress made in establishing common requirements, bringing objectivity and control to processes, and improving how we define and conduct business go the way of the dodo?
It would be a shameful and unfortunate turn of events if we undid all the progress made in the business community through this QMS model. Notwithstanding the hype and pressure to try something new, ISO 9001 remains a very good thing.
ISO 9001 is an elegant, albeit generic, model that applies remarkably well to a diverse array of organizations. Registrations to ISO 9001 can be found across the entire spectrum of industries: software, service, banking, health care, light manufacturing, foundries, pharmaceuticals, transportation, recreation and everything in between. It creates parity in the market, making it possible for small companies (the traditional backbone of the U.S. economy) to compete globally. Although there are other criteria that companies assess when deciding what vendors to select (e.g., number of employees, years in operation, sophistication, net worth, etc.), ISO 9001 levels the playing field, applying equally to all. The certificate reads the same regardless of the company's size or how much money it has in the bank.
A certificate signifies a commitment to quality. It projects a level of excellence that helps maintain customers' confidence in a product. It's tantamount to a pledge to operate within a defined and controlled system that gives due consideration
to how:
• Customer orders are processed
• A design process is managed
• Suppliers are qualified
• Mistakes are handled
• Acceptance criteria are established
• Competent people are trained
• Tools, inventory and equipment are maintained
• Progress is checked
The 2000 version of ISO 9001 isn't a terribly complicated or lengthy document, but it's certainly an impressive one. The standard has transformed workplace culture. It's an empowering document, manifesting one of W. Edwards Deming's key principles: "Drive out fear." Everything about this QMS model supports this tenet because it's founded on management's commitment, documented requirements and data, rather than wishful thinking, supposition and alarmists' dire predictions.
ISO 9001 is the antithesis of the sweatshop model where terrorized employees were forced to produce regardless of working conditions and despite inadequate tools, time or training. Do we really want to see industries revert to Draconian management by fear?
There have been a few challenges to ISO 9001 in recent years. The two most significant ones were more a matter of perception than anything else. They came from proponents of Six Sigma and lean manufacturing. It wasn't these valuable tools themselves that posed a challenge; rather, the problem arose from those who suggested that either of them could supplant ISO 9001 as the ultimate quality model.
This was a favorite misconception, especially with some of the lean prophets, and because it was an enticing one, it spread quickly. One of the false impressions was that any activity a customer didn't directly pay for was a candidate for elimination or sharp curtailment. As a result, ISO 9001 requirements that supported processes such as calibration, purchasing and management review were denigrated. In truth, good lean practices complement a QMS. Efficient, well-implemented supplier monitoring programs, for example, might initially incur costs but will ultimately reap benefits from more consistent and reliable vendor performance. This, in turn, results in fewer returns, fewer costly interruptions to production schedules and a decreased risk of defects reaching customers.
Similarly, during its early years Six Sigma was presented as the better choice of an invalid either/or scenario. Organizations were told by some consultants that they could either have an ISO-registered system, or they could implement Six Sigma projects to address problems and realize improvement. The implication was that the two were mutually exclusive.
Six Sigma's distinguishing characteristic is the application of statistical process control (SPC) methodologies, usually associated with manufacturing, to all organizational processes. Just as with ISO 9001, the focus is on identifying requirements that are important to the customer. Both Six Sigma and ISO 9001 strive to accurately assess process capabilities--Six Sigma through disciplined, SPC-type tools, and ISO 9001 by analyzing data from multiple sources and internal audits, and by applying the plan-do-check-act model. The goal in each case is to increase the level of
consistency and reliability of the material or service supplied to customers. Both systems use core quality tools such as SPC, design of experiments and cost of quality to achieve their goals. However, Six Sigma is more structured and not as adaptable to all industries. In those industries where it can be used effectively, it's been found to be quite compatible with ISO 9001, augmenting an organization's improvement tools. But it lacks the universality and fundamental simplicity that's one of ISO 9001's hallmarks.
The other significant challenge came with the downturn in the telecom industries and the ensuing recession. Historically, during tough years, organizations have identified as candidates for elimination those activities they consider the farthest from their actual bottom lines. Some managers looked upon "ISO stuff" as a nice frill that could be supported only in the good times. Some companies made the unfortunate decision to abandon their certified systems; others pared back training, surveillance audits and quality initiatives. Despite some attrition during the economic slump, the number of North American certificates continued to climb. During this time, there was also the confusing (to some) transition to ISO 9001:2000. In the end, better than 90 percent of organizations with ISO 9001:1994 made the transition to the new version. This is perhaps the strongest endorsement of the ISO 9001 model: It survived a period of economic turmoil.
ISO 9001 weathered the storm of these challenges--not by overcoming them, but by acknowledging their appropriate role within a well-implemented QMS. We've reached a point where ISO 9001's sustainability as a long-term, viable QMS model has been firmly established. So what's on the horizon?
A number of sector-specific standards have proliferated in recent years. Most widely known are ISO/TS 16949 for automotive, ISO 13485 for medical devices and AS9100 for aerospace. These use ISO 9001's solid foundation and build in additional requirements specific to their industries. This offers several benefits. It allows users to employ the same methodology for incorporating customer (or sector-specific) requirements into an already existing QMS model. It streamlines systems for organizations that must conform to requirements from multiple industries. It facilitates supplier qualification and monitoring for customers.
There are two disadvantages to this approach, however. One is that the proliferation of sector-specific standards will dilute the value of the ISO 9001 standard in the marketplace. In some markets there are already instances where ISO 9001 is perceived as a basic standard, with sector-specifics gaining stature as hierarchically superior models. The other drawback is that too many standards might cause organizations to incur unnecessary costs as they attempt to serve multiple industries by carrying different certifications. This doesn't even address additional certifications such as ISO/IEC 17025 and ISO 14001, relating to test labs and environmental concerns, respectively.
To maintain the value of multiple standards, those responsible for generating them must pay attention to the marketplace. The prospect of maintaining multiple certificates could become as onerous and overwhelming as trying to serve many masters. Standards writers must ensure that the value of a well-implemented QMS isn't supplanted by the inappropriate cost of maintaining various and sometimes conflicting requirements.
Current indications from TC 176, the committee responsible for developing the ISO 9000 family of standards, suggest that no major changes to ISO 9001:2000 will be made in the near future. A decision was made at the most recent ISO 9001 plenary session, held in November 2004, to limit the scope of changes to amendments. This means that any edits will be for the purpose of clarification or to address ambiguities.
Although the standard isn't changing, other documents are being revised that could have a positive effect on users' understanding and implementation of it. I'm fortunate to be on the working group that's currently revising ISO 10014, "Guidelines for managing the economics of quality." The focus of this document is top management, and its intent is to provide guidance for using a QMS to improve an organization's bottom line.
The next big hurdle for ISO 9001 is to manifest its benefits in the boardroom. Quality professionals have long been perceived as out of touch with the budgetary process. We must make a visible and direct correlation between implementing a QMS and deploying strategic plans.
ISO 9004, the guidance document that supports ISO 9001, expresses eight quality management principles. The seventh of these is a factual approach to decision making. Simply put, managers must base their decisions on facts and data. If we, as quality professionals, expect managers to allocate the necessary resources for quality initiatives and corrective action plans, the burden is upon us to provide them with the objective evidence they need to justify their decisions. Executive management is responsible to shareholders, financial institutions, employees and customers. It shouldn't allocate monies to quality-related projects unless we provide the facts to support our plans and programs. Quality professionals must do a better job of understanding how budgets work and the effect allocations have on the bottom line.
When conducting corrective actions, for example, we should begin by evaluating the cost of action against the risk of inaction. We must assess a problem's financial implication before we expend resources on solving it. We should be able to identify the economic pain and, whenever possible, quantify it.
For example, the cost to replace defective product might be minimal compared to the cost of implementing a corrective action plan. But before making a final decision, the following questions should be answered:
• What's the risk of not responding to the customer's request for corrective action?
• How much income does this account represent?
• How often has this happened, and what's the likelihood of recurrence?
• What does it cost in time, labor and resources to replace the product?
• How will it affect the organization if the customer stops asking you to bid on new projects?
• What will this problem do to the organization's reputation in the marketplace?
The information necessary to make the decision will include cost of materials, production time and possible overtime, annual sales revenues from the customer, projected value of potential additional business and information from sales about market trends. Armed with this objective evidence, quality personnel can give management the justification it requires to allocate the needed resources.
For this reason, items such as corrective actions are included on the list of items for management review. Once corrective actions have been implemented, the onus is on the quality department to assess effectiveness and report that information back to management, preferably quantified to reflect the return on investment. In this way, top managers have the information they need to allocate monies to ensure the perpetuation of a process that has proven to have a positive effect on the bottom line.
This is the challenge to quality practitioners and ISO 9001 proponents: to embed the QMS so completely into the organization that quality objects become synonymous with strategic goals. It's not for top management to understand ISO 9001; it's for quality people to make the standard meaningful to management. Without this commitment, the standard eventually will fade away as another defunct fad whose time has passed.
Denise Robitaille is a consultant, writer and trainer. She's also a lead assessor and certified quality auditor. She's the author of The Corrective Action Handbook, The Preventive Action Handbook and The Management Review Handbook, each of which is available from Paton Press (www.patonpress.com).
|
