Policy Governance & Quality
(Allusions to Holistic Framework made in Underlined Italics)
Qualityworld
Meeting the challenge
The past ten years have seen significant growth in the adoption of the ISO 9000-based QMS in the UK. Mike James of LRQA, explains the likely impact of the revised standard on the quality systems of UK plc
Expectations of ISO 9000 have risen as organisations have improved their understanding of it; organisations expect internal benefits from their QMSs; where they require suppliers to be certificated to ISO 9000, organisations expect consistent delivery of their orders; they require that certification bodies provide an auditing service that not only verifies their compliance with the standard, but also has an intrinsic value to help improve systems and processes. Unsurprisingly, not all of these expectations have been met. Nonetheless, the changes introduced in ISO 9001:2000 have the potential to meet these expectations, provided that all parties concerned rise to meet the challenge laid down by the revised standard.
Although there have been a number of changes, the ones which will have the greatest impact are those that elevate the management of quality from an operational to a strategic level. These changes are associated with the leadership of the quality system, the management of continual improvement and the increased focus on meeting customer needs.
The QMS continuum
At present, organisations in the UK implement ISO 9000-based quality systems in various ways. These can be said to form a continuum, with compliance-based systems at one end of the spectrum and the continually improving systems at the other.
The reason for this is that, initially, an organisation will construct a compliant system to achieve the certification required by its customers. However, the system is not as effective as it could be, from the perspective of managing quality in the organisation. Some companies' systems remain in this compliant state, with limited changes aimed at reducing the bureaucracy initially created to gain approval.
Many companies develop their systems beyond this stage, to what can best be described as 'effective systems', which:
concentrate on the elimination of non-conformance
have some system improvements
ensure that customers receive the product they ordered
These systems are operationally based.
Far fewer organisations' systems evolve into those that are continually improving:
providing a link to overall business objectives
systematically managing improvement
having customer satisfaction as their central aim
These systems are strategically based and provide the greatest benefits to the organisations that invest in their implementation.
The key difference between these approaches is in the extent to which the QMS is integral to the running of the business. At one end of the spectrum is a system that satisfies primarily the certification body and its customers, at the other is a system which achieves both of these aims and is one of a number of systems and processes that the organisation uses to manage its business. The introduction of ISO 9001:2000 will have the overall effect of shifting approved organisations further along the continuum, from compliant systems into effective and continually-improving ones.
In addition, balancing the competence of staff carrying out quality-related work against the need for procedures will significantly reduce systems' bureaucracy, and concomitantly, the requirement for procedures. This will help to create systems that more realistically describe how a business operates. It will therefore ease the natural integration of the quality system with other business systems.
Where an organisation should begin, in terms of implementing the revised standard, depends on where they are on this continuum. Most will fall somewhere in the middle. One issue that will have a major impact is top management's role in leading and directing the quality system. It is self-evident that there is a significant correlation between top management commitment and the successful operation of the QMS. This issue has been raised by many clients, who feel that their company's top management has become divorced from the operation of the quality system.
To some extent this is understandable, if we consider that the majority of systems fall into the middle category. In this case, top management was probably involved at the outset, providing the drive and resources needed to gain certification. However, having gained approval and a sense of assurance from the system, they turned to other business issues. As most quality managers will be aware, a good quality system soon becomes invisible.
Where do you stand?
There is a key role for both the quality manager and the quality system auditor in involving top management. The starting point is the development of quality objectives, which should flow from the quality policy and the business objectives.
The quality manager can facilitate this process by helping to identify the quality objectives of the organisation. Top management tends to think in terms of business objectives, which are very often the same as quality objectives (for example, improving customer retention, which is both a quality and a business objective). Part of the solution could be economic; pricing and parts could be quality related, and both will need managing through the systems of the business.
The assessor can help in the process of involving top management, as the assessment process will change with the revised version of the standard. ISO 900 1:2000 changes the emphasis of the assessment, from focusing on conformance to procedures, to determining how effectively quality objectives to meet customer needs have been implemented; assessment becomes a diagnostic tool for top management to see how well their intentions are being translated into satisfying customers' needs.
In this sense, the revised standard gives top management a process for satisfying customers, which along with the finance, people management and business planning processes, is the key focus of its efforts. The challenge to both the quality manager and the assessor is to use the QMS to provide information to top management, which is both timely and relevant.
Arguably, the most significant change in the standard has been the introduction of a requirement for managing continual improvement. This will provide many challenges and benefits to companies, by 'unfreezing' many systems. This 'freezing' occurs because organisations do not wish to place their certification in jeopardy by introducing too much change.
The fear of change
This fear of changing the system acts as a barrier to improvement. Certification bodies must ensure that their requirements are clear and their interpretation of the standard is consistent. If an organisation is confident in its certification body's interpretation, it will be more likely to make the changes necessary to bring about improvement.
The introduction of a forward-looking management review, combined with a requirement for continual improvement and a process-based approach that ensures greater transparency of operation, should help organisations to manage change as they continue to evolve.
Move to improvement
A common barrier to improvement is that staff members do not understand what is required to bring about improvement. The revised standard is far more communicative than the last, and will assist organisations in managing improvement by ensuring that improvement programmes are linked with quality objectives and communicated to all levels of the organisation.
In the recent past, much of the debate has focused on the nature of the systems that have been implemented and the role of third-party auditors. However, this runs the risk of neglecting the needs of organisations that use ISO 9000 to ensure quality from their suppliers. There is an important change in the standard that will affect the customer-supplier relationship.
Purchasing power!
One of the main benefits of ISO 9000, from the perspective of purchasing, is that it can be used to reduce purchasing risk by increasing the probability that it will get what it ordered from suppliers. Indeed, the driving force behind ISO 9000 uptake around the world has been organisations with increasingly global supply chains demanding it of their suppliers.
In addition to providing an increased level of confidence, this has also proven to be economically advantageous, reducing the need for these organisations to maintain the in-house resource for conducting extensive supplier audits. However, some purchasers believe that although, on balance, they have gained from this approach, some of their more specific needs are not met by third-party auditing. This is because third-parry auditing is broader in focus and requires confidentiality between the certification body and its clients.
The revised standard strengthens the connection between customer and supplier, placing greater emphasis on supplier understanding and meeting of customer needs. This should increase customer confidence that third-party certification will demonstrate suppliers' capability to understand and meet these needs.
Finally, ISO 9001:2000 undoubtedly 'raises the bar' in terms of quality and there has been some speculation that organisations will drop out of certification entirely, however, recent research1 indicates that there is a lot of support for the new version of the standard among SMEs.
All parties concerned need to work to ensure that this does not happen as, although there will be an improvement in ISO 9000 quality systems as a result of the changes in the standard, if large numbers of organisations drop out, there will be an overall reduction in the quality of UK plc. This defeats the original purpose behind the introduction of BS 5750 and subsequently ISO 9000!
References
Leicester University Research Project on the 'likely impact of the revision to ISO 9000 on small and medium sized enterprises (SMEs)' - January 2001
Mike James is UK general manager of Lloyd's Register Quality Assurance Ltd (LRQA) and Lloyd's Register of Shipping (Industry division), throughout the UK. He has worked for LRQA for over eight years, previously holding the positions of corporate marketing and planning manager for worldwide operations and market development manager for new services and sectors.
Qualityworld
Meeting the challenge
The past ten years have seen significant growth in the adoption of the ISO 9000-based QMS in the UK. Mike James of LRQA, explains the likely impact of the revised standard on the quality systems of UK plc
Expectations of ISO 9000 have risen as organisations have improved their understanding of it; organisations expect internal benefits from their QMSs; where they require suppliers to be certificated to ISO 9000, organisations expect consistent delivery of their orders; they require that certification bodies provide an auditing service that not only verifies their compliance with the standard, but also has an intrinsic value to help improve systems and processes. Unsurprisingly, not all of these expectations have been met. Nonetheless, the changes introduced in ISO 9001:2000 have the potential to meet these expectations, provided that all parties concerned rise to meet the challenge laid down by the revised standard.
Although there have been a number of changes, the ones which will have the greatest impact are those that elevate the management of quality from an operational to a strategic level. These changes are associated with the leadership of the quality system, the management of continual improvement and the increased focus on meeting customer needs.
The QMS continuum
At present, organisations in the UK implement ISO 9000-based quality systems in various ways. These can be said to form a continuum, with compliance-based systems at one end of the spectrum and the continually improving systems at the other.
The reason for this is that, initially, an organisation will construct a compliant system to achieve the certification required by its customers. However, the system is not as effective as it could be, from the perspective of managing quality in the organisation. Some companies' systems remain in this compliant state, with limited changes aimed at reducing the bureaucracy initially created to gain approval.
Many companies develop their systems beyond this stage, to what can best be described as 'effective systems', which:
concentrate on the elimination of non-conformance
have some system improvements
ensure that customers receive the product they ordered
These systems are operationally based.
Far fewer organisations' systems evolve into those that are continually improving:
providing a link to overall business objectives
systematically managing improvement
having customer satisfaction as their central aim
These systems are strategically based and provide the greatest benefits to the organisations that invest in their implementation.
The key difference between these approaches is in the extent to which the QMS is integral to the running of the business. At one end of the spectrum is a system that satisfies primarily the certification body and its customers, at the other is a system which achieves both of these aims and is one of a number of systems and processes that the organisation uses to manage its business. The introduction of ISO 9001:2000 will have the overall effect of shifting approved organisations further along the continuum, from compliant systems into effective and continually-improving ones.
In addition, balancing the competence of staff carrying out quality-related work against the need for procedures will significantly reduce systems' bureaucracy, and concomitantly, the requirement for procedures. This will help to create systems that more realistically describe how a business operates. It will therefore ease the natural integration of the quality system with other business systems.
Where an organisation should begin, in terms of implementing the revised standard, depends on where they are on this continuum. Most will fall somewhere in the middle. One issue that will have a major impact is top management's role in leading and directing the quality system. It is self-evident that there is a significant correlation between top management commitment and the successful operation of the QMS. This issue has been raised by many clients, who feel that their company's top management has become divorced from the operation of the quality system.
To some extent this is understandable, if we consider that the majority of systems fall into the middle category. In this case, top management was probably involved at the outset, providing the drive and resources needed to gain certification. However, having gained approval and a sense of assurance from the system, they turned to other business issues. As most quality managers will be aware, a good quality system soon becomes invisible.
Where do you stand?
There is a key role for both the quality manager and the quality system auditor in involving top management. The starting point is the development of quality objectives, which should flow from the quality policy and the business objectives.
The quality manager can facilitate this process by helping to identify the quality objectives of the organisation. Top management tends to think in terms of business objectives, which are very often the same as quality objectives (for example, improving customer retention, which is both a quality and a business objective). Part of the solution could be economic; pricing and parts could be quality related, and both will need managing through the systems of the business.
The assessor can help in the process of involving top management, as the assessment process will change with the revised version of the standard. ISO 900 1:2000 changes the emphasis of the assessment, from focusing on conformance to procedures, to determining how effectively quality objectives to meet customer needs have been implemented; assessment becomes a diagnostic tool for top management to see how well their intentions are being translated into satisfying customers' needs.
In this sense, the revised standard gives top management a process for satisfying customers, which along with the finance, people management and business planning processes, is the key focus of its efforts. The challenge to both the quality manager and the assessor is to use the QMS to provide information to top management, which is both timely and relevant.
Arguably, the most significant change in the standard has been the introduction of a requirement for managing continual improvement. This will provide many challenges and benefits to companies, by 'unfreezing' many systems. This 'freezing' occurs because organisations do not wish to place their certification in jeopardy by introducing too much change.
The fear of change
This fear of changing the system acts as a barrier to improvement. Certification bodies must ensure that their requirements are clear and their interpretation of the standard is consistent. If an organisation is confident in its certification body's interpretation, it will be more likely to make the changes necessary to bring about improvement.
The introduction of a forward-looking management review, combined with a requirement for continual improvement and a process-based approach that ensures greater transparency of operation, should help organisations to manage change as they continue to evolve.
Move to improvement
A common barrier to improvement is that staff members do not understand what is required to bring about improvement. The revised standard is far more communicative than the last, and will assist organisations in managing improvement by ensuring that improvement programmes are linked with quality objectives and communicated to all levels of the organisation.
In the recent past, much of the debate has focused on the nature of the systems that have been implemented and the role of third-party auditors. However, this runs the risk of neglecting the needs of organisations that use ISO 9000 to ensure quality from their suppliers. There is an important change in the standard that will affect the customer-supplier relationship.
Purchasing power!
One of the main benefits of ISO 9000, from the perspective of purchasing, is that it can be used to reduce purchasing risk by increasing the probability that it will get what it ordered from suppliers. Indeed, the driving force behind ISO 9000 uptake around the world has been organisations with increasingly global supply chains demanding it of their suppliers.
In addition to providing an increased level of confidence, this has also proven to be economically advantageous, reducing the need for these organisations to maintain the in-house resource for conducting extensive supplier audits. However, some purchasers believe that although, on balance, they have gained from this approach, some of their more specific needs are not met by third-party auditing. This is because third-parry auditing is broader in focus and requires confidentiality between the certification body and its clients.
The revised standard strengthens the connection between customer and supplier, placing greater emphasis on supplier understanding and meeting of customer needs. This should increase customer confidence that third-party certification will demonstrate suppliers' capability to understand and meet these needs.
Finally, ISO 9001:2000 undoubtedly 'raises the bar' in terms of quality and there has been some speculation that organisations will drop out of certification entirely, however, recent research1 indicates that there is a lot of support for the new version of the standard among SMEs.
All parties concerned need to work to ensure that this does not happen as, although there will be an improvement in ISO 9000 quality systems as a result of the changes in the standard, if large numbers of organisations drop out, there will be an overall reduction in the quality of UK plc. This defeats the original purpose behind the introduction of BS 5750 and subsequently ISO 9000!
References
Leicester University Research Project on the 'likely impact of the revision to ISO 9000 on small and medium sized enterprises (SMEs)' - January 2001
Mike James is UK general manager of Lloyd's Register Quality Assurance Ltd (LRQA) and Lloyd's Register of Shipping (Industry division), throughout the UK. He has worked for LRQA for over eight years, previously holding the positions of corporate marketing and planning manager for worldwide operations and market development manager for new services and sectors.
posted by T at 4:19 pm
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