Quality Management System
Quality Management System
Quality is a perceptual, conditional, and somewhat subjective attribute of a product or service. Its meaning in business has developed over time. It has been understood differently and interpreted differently by different people. An organization benefits most through focusing on the key processes which provide its customers with products and services of needed quality. Quality can be defined in three ways namely (i) based on perceptions of the customer for a design of the product or service and how well the design matches the original specifications, (ii) the ability of a product or a service to satisfy stated or implied needs of the customers, and (iii) achieved by conforming to established requirements within the organization.
Organizational success can simply be the extent to which the organization can produce a higher quality product or service than its competitors are able to do at a competitive price. When quality is the key to the success of the organization, a quality management system (QMS) allows the organization to keep up with and meet the present quality levels, meet the customers’ requirement for quality, retain employees through competitive compensation programmes, and keep up with the latest technology.
QMS is a dynamic system which evolves over a period of time through improvement. It is a management technique used to communicate to the employees what is needed to produce the desired quality of products and services and to influence employees’ actions to complete tasks according to the quality specifications. It is a structured collection of written policies, processes, documented procedures and records and their associated responsibilities. The purpose of a QMS includes (i) to establish a vision for the employees, (ii) to set standards for the employees, (iii) to build motivation within the organization, (iv) to sets goals for the employees, (v) to help fight the resistance to change within organization, and (vi) to help direct the corporate culture. QMS is necessary to determine activities which already exist and their suitability within the context of the organization.
QMS provides opportunities (i) to review and help the organization in becoming more competitive, (ii) to improve communication within the organization, (ii) to structure approaches in correcting defects, mistakes, or deviations, (iii) to take process of corrective and preventing actions for ensuring higher risk problems and issues are promptly and properly dealt with, (iv) to ensure that corrective and preventing actions are consistently undertaken based on priority and risk, and (v) to improve complaint handling which results into better customer satisfaction.
QMS enables the organization to run more efficiently and profitably. It provides a way to organize people, resources, and processes to achieve organizational goals, regardless of the size of the organization. Evidence has shown that the organizations which adopt the requirements for QMS can build a system which facilitates development and growth, supports the organizational management in maximizing the value in the business concept and provides a framework to ensure all legal and statutory requirements are met. A formal QMS provides a framework for planning, executing, monitoring, and improving the performance of quality related activities.
There are four terms which are normally used when the organization develops its QMS. These are (i) conformity assessment, (ii) attestation, (iii) certification, and (iv) accreditation. Conformity assessment is the demonstration that specified requirements relating to a product, process, system, person, or body are fulfilled. The subject field of conformity assessment includes activities such as testing, inspection and certification, as well as the accreditation of conformity assessment bodies. Attestation means issue of a statement, based on a decision following review, that fulfillment of the specified requirements has been demonstrated. The resulting statement, referred to as a ‘statement of conformity’, conveys the assurance that the specified requirements have been fulfilled. Such an assurance does not, of itself, afford contractual or other legal guarantees. Certification is the third-party attestation related to products, processes, systems or persons. Certification of a management system is sometimes also called registration. Certification is applicable to all objects of conformity assessment except for conformity assessment bodies themselves, to which accreditation is applicable. Accreditation is the third-party attestation related to a conformity assessment body conveying formal demonstration of its competence to carry out specific conformity assessment tasks.
Elements of a QMS
The general requirements of the QMS include (i) determination of the processes of the QMS, (ii) determination of their sequence and interactions, (iii) determination of the methods of operations and control, (iv) providing the resources to ensure effective operations, (v) monitoring, measuring, and analyzing of the processes, and (vi) improvement in the effectiveness of the processes. Further, there are several elements to a QMS, and each organization has its own unique system. The most important elements of a QMS include participative management, QMS design, customers, suppliers, education and training, statistics, auditing, and process approach.
Participative management – The entire quality process, once started, is an ongoing dynamic part of the organization, just like any other department such as operations, marketing, or finance and accounting. It also needs the continuous focus of the management. The implementation and management of a successful QMS involves several different aspects which are to be addressed on a continuous basis.
The starting point for the management and leadership process is the formation of a well-defined vision and value statement. This statement is used to establish the importance of the QMS and to build motivation for the changes which are needed to take place. The changes take place whether the organization plans to exceed customer expectations, commit to a defined level of customer satisfaction, or commit to zero defects. The exact form of the vision and values is not as important as the fact that it is to be expressed and to be known by everyone involved. This vision and value statement is a driving force in helping to mould the culture which is needed throughout the organization when it drives for the quality. It is not the words of the value statement which produce quality products and services but it is the people and processes which determine if there is going to be a change in quality. The vision and value statement is a very important statement which sets the agenda for all other processes used to manage the QMS.
The plan for the QMS is to be different for every organization, but there are similar characteristics, which include (i) clear and measurable goals, (ii) financial resources to be available for quality, and (iii) quality plan is consistent with the vision and values of the organization. The plan for the QMS can include pilot projects which involves setting up small quality projects within the organization. This allows the management (i) understand how well the QMS is accepted, (ii) learn from mistakes, and (iii) have higher confidence in launching an organization-wide QMS. The plan is to provide some flexibility for employees’ empowerment, since, as has been demonstrated, the most successful QMS allow employees at all levels to provide input.
Change, especially a movement toward higher quality, is challenging to communicate effectively, yet the communication process is essential for the organizational leaders to move the organization forward. Communication is the crucial link between management, employees, customers, and stake-holders. The communication lines also bring about a sense of solidarity between all individuals involved and help sustain the drive for the successful completion of long term quality goals. Communication system is also to allow for the employees to give feedback and to provide possible solutions to the issues which the organization is facing. Management needs to allow this both in the formal and informal ways, such as employee feedback slips and feedback round-table meetings. The responsibility for nurturing a culture which values communication lies with the management. It alone has to ensure that goals and objectives are communicated to all. It is also responsible for setting up the system for the feedback from the employees.
Rewards, compensation, and acknowledgment for achievements in quality are very effective ways to motivate the employees. They tell employees at the end of the day exactly what management is trying to accomplish. Rewards, compensation, and acknowledgment can also be seen as a form of communication. They are tangible methods which the management uses to let employees know that quality is important. This can come in the form of individual rewards or team awards. Rewards, compensation, and acknowledgment take many forms, and it is up to the management to ensure that this type of programme is in line with both the goals and objectives of the QMS as well as the organization. Several organizations have found that the best and most cost-effective reward, compensation, and acknowledgment programmes are geared to meeting specific criteria. These programmes motivate managers who in turn motivate their employees to strive toward pre-defined goals.
QMS design – A QMS is composed of the standards and procedures which are developed to ensure that the level of quality desired is repeated in every unit of a product or service. This portion of the QMS is very concrete and can be measured and managed. Before the organization starts, it is to establish a core team to carry the performance system design process forward. The design process constitutes eight steps as described below.
The first step is to understand and map all structures and processes on which the organization operates. This forces employees involved in designing a performance measurement system to think through and understand the entire organization, its competitive position, the environment in which it operates, and its operational processes. This also allows for complete understanding of customer touch points and how the different operations in the organization affect the customers’ perception of quality.
The second step is the development of the performance priorities. The performance measurement system is to support the stake-holders’ requirements from the organization’s strategy through to its operational processes. This order of priorities is to be in place well before the process enters the actual design phase.
The third step is to understand the present performance measurement system. Every organization has some kind of measurement system in place. For this reason, there are basically two ways to approach the design and implementation of a new performance measurement system. The organization can either scrap the old system or introduce a new one as a replacement, or it can redevelop the existing system. Both approaches can work, but the former approach is more likely to lead to trouble, since the employees are going to stick to the old measurement system and either use both the systems simultaneously or use the old one and simply go through the motions of the new one. This outcome can be eliminated by taking the second approach.
The fourth step is to develop the performance indicators. The most important element of a performance measurement system is the set of performance indicators which are used to measure the organizational performance and the organizational processes. This is the point in the design process where the top-down approach meets the bottom-up design approach and where most of the people of the organization get involved. The purpose of this step is to develop the performance measurement system with an appropriate number of relevant and accurate performance indicators.
The fifth step is to decide how to collect the needed data. Developing perfect performance indicators which are going to tell everything people want to know about what is going on in the organization is one thing, but being able to collect the data required to calculate these performance indicators is a completely different matter. This issue is to be initially addressed during the development of the performance indicators so that the selection of those indicators which can never actually be measured can be avoided. Also, there is to be trade-offs of cost and time versus the benefits of collecting data, but a likely middle ground between perfect data / high cost and no data / no cost is to be found.
The sixth step is to design reporting and performance data representation formats. In this step, it is to be decided how the performance data is to be presented to the users, how the users is to apply the performance data for management, monitoring, and improvement, and who need to have access to the performance data. After this is finished, there is a performance measurement system is in place which has a solid place in the organizational overall measurement based management system.
The seventh step is to decide to test and adjust the performance measurement system. Most likely the first attempt at the performance measurement system is not perfect. There are bound to be performance indicators which do not work as intended, conflicting indicators, undesirable behaviour, and problems with data availability. This is to be expected. In this step, extensive test of the system is to be carried out for adjusting the elements which do not work as planned.
The eighth step is to implement the performance measurement system and to put the QMS to use. This is when the QMS is officially in place and everyone can start using it. This step involves issues such as managing user access, training, and demonstrating the system.
The above eight step process is not an absolute process which is required to be followed to the letter and spirit in order for it to work. In some cases, one or more steps are not needed while in some other cases additional steps are needed. It is upto the organization to make the necessary adjustments to the process to maximize the probability of the success of the QMS.
The remaining elements of the QMS are conceptual. They constitute more of the role of the management in increasing motivation and the determination to make the first two elements run smoothly. It is rooted in the communication between management and employees, majority of them being the employees who are performing the activities and process know how to improve the quality.
Customers – The inclusion of customers in a quality programmes can take several different paths, including the cost of losing a customer, the customer’s perception of quality, and the satisfaction level of the customers. The customer portion of a quality programme is going to be unique for every industry and organization, but it is to capture how quality plays into the customer’s value system and how quality drives the purchase decision.
In some industries, quality is measured in customer retention rates and the cost of losing a customer. If typical accounting measures can capture the exact cost of losing a customer then it is easy for the managers to allocate the exact amount of resources needed to retain customers. As per some studies, an organization can increase profits by almost 100 % by retaining 5 % more of their customers. Customers over time generate more profits the longer they stay with the same organization. Perceived quality by customers leads to referrals. In certain industries, referrals can equate to more than 60 % new business. If an organization can increase the number of referrals through increased quality, it is going to have a substantial effect on the bottom line of the organization.
Suppliers – The organization purchases its inputs from the suppliers. Purchasing is an area in the organization where substantial gains in quality can be realized through the implementation of just a few policies and procedures designed around quality. Present day suppliers need to be partners in the quality effort. The organizational products or services are only as good as the combination of all the inputs.
The first step in moulding the purchasing system to collaborate with the entire quality system is to take all the standards developed for all the incoming materials which can be qualified as an input to routine process or activity. If the quality system’s performance standards and procedures are completed as described in the design phase these standards are already to be established.
The second step is educating the purchasing personnel on how the standards are important to the process flows of the organization. If standards are not upheld, the quality of the product or service gets jeopardized. The employees are also to be educated on how to measure and communicate the required standards. This can involve materials or statistical process control (SPC) education, and it can even be as simple as cross-training the purchasing personnel so that they know exactly how the inputs fit into the organization. Once the purchasing area knows how the products are used and what problems can arise then they has a better chance of procuring inputs which meet all the specifications.
Once both the steps are complete then it is the responsibility of the purchasing department to communicate the requirements to the suppliers and hold them accountable for the quality. This sometimes is not be a simple task and can involve finding new suppliers or working with the present suppliers to develop higher quality standards.
Education and training – The education of employees for the purpose of reaching higher quality standards has several different aspects. For example, the quality education of management is going to be different than the quality education of the employees at the working level, since they play different roles in the process. Since the majority of the quality problems start at the top, so they also need to be educated. The education of management on quality issues is to start with a general discussion of quality systems and the roles management plays in quality programmes. With respect to general knowledge, management is to understand the history of the quality movement, who the major players were, and how quality programmes have affected the organizations around the world. More specifically, managers are to know how quality programmes have affected their specific industry in the past, and they are to have an idea of what role quality programmes play in the future of their industry.
Management is also to keep abreast of new developments in quality. The discussion of the roles which management is to play in a QMS is the most important aspect of their education. Management is to understand how employees view their actions or inactions, how their individual actions and jobs impact quality, and the overall importance of dedication to quality by management. Managers are to understand that without strong leadership and reinforcing dedication to quality, a quality programme is not going to have a substantial impact.
The education and training of employees for a quality programme is to include a discussion of how these programmes affect their jobs on a daily basis. The programmes are also to include a brief overview of quality as well as the tools employees use in order to ensure outputs and how their roles add to the overall quality goals of the organization.
Data development and statistics – Statistical analysis is a very important aspect of the QMS. It can be considered a cornerstone of the quality improvement process and is very closely tied to auditing a quality system. SPC (statistical process control) is used by the decision makers in QMS. Statistical analysis is the measurement portion of quality systems and allows it to be managed. A very common saying in management, which relates well to quality, is ‘one cannot manage what one cannot measure’, and statistical analysis gives a person the measurements necessary to make management decisions.
Statistics was a key tool which Deming used to distinguish between systemic and special causes, and the key to quality management in general was SPC. SPC was developed by Walter Shewart while working at Bell Labs in the 1930s, and Deming took Shewart’s concept and applied it to quality management. Deming believed that SPC was necessary since variation is a fact of life in any process. Deming believed that it was very unlikely that two products or services when produced by the same procedure and person would be identical.
Control charts play important role in QMS and are the most widely used tool. They communicate a lot of information effectively. Fig 1 shows a control chart of a process in which all the outcomes are within the specified limits. The upper control limit (UCL) is 0.18 and the lower control limit (LCL) is 0.02, and all the points fall between these two limits. This means the process is in control and operating correctly. If some of the points are falling outside of the UCL or LCL, it gives a signal that the process is not in control and action needs to be taken to correct the problem. There can be two different types of errors namely (i) systematic, and (ii) special causes. Systematic errors show up on a control chart as one or two points outside of the control limits with the rest of the points within the limits. Special causes show up on a control chart with numerous points outside of the control limits.
Fig 1 Control chart
The exact use of statistical measures is different for each organization. Some statistical analyses are very easy to set up and use. For example, the length or weight of a particular part can be measured and analysis can show if the parts are within the required specifications. In service departments the statistical analysis is to be more abstract, but is just as valuable. For example, one can survey the customers regularly and ask them on a scale of 1 to 10, ‘how they rate the performance’. Some of the common traits of statistical measures used in QMS (i) are driven by the customer, (ii) reflect vision and values, (iii) benchmarked to the competition, and (iv) are achievable.
Auditing – Auditing a QMS is just as important as any other aspect of the system. The audit process allows everyone involved to see if the QMS is working properly and if the goals and objectives are being achieved. Auditing also plays major roles in motivating employees and allows for rewards and acknowledgment measures to be assessed as well as possible compensation. Auditing of QMS can take several forms, and each organization needs to have a unique auditing process which fits its system.
Process approach – A system is needed for the management of the quality. The system is to be managed using the process approach since the system is made up of several processes which are linked to each other. A process has inputs, resources, activities, outputs and customers which are to be managed. All the processes need managing. The output of one process can form directly the input to the next process and the final product is frequently the result of a network or system of processes.
Processes are controlled through control processes for their better effectiveness and for increase in their efficiencies. Measurement and monitoring of the processes encourage continuous improvement in quality and productivity which become part of the organization culture. Fig 2 shows schematic representation of the elements of a single process.
Fig 2 Schematic representation of the elements of a single process
In QMS, the organization determines opportunities for improvement, as well as plans and actually implements actions in order to achieve the intended results and to enhance customer satisfaction. Improvements can help it to keep meeting customer requirements and expectations by improving its products and services, correcting or preventing undesired effects, and improving the performance and effectiveness of the QMS. There are different methods to conduct improvement, such as (i) taking actions to avoid the recurrence of non-conformities, (ii) small-step ongoing improvement activities conducted within the existing processes, products or services which can lead to considerable changes to existing processes, as well as the implementation of new processes, products or services, and (iii) the introduction of disruptive new technologies or innovations.
QMS is a process based system in which the interested parties play a considerable role in providing inputs to the organization. Monitoring of the satisfaction of interested parties needs the evaluation of information relating to the perception of interested parties as to the extent to which their needs and expectations have been met. Fig 3 shows the process based model for the QMS. This figure does not show processes at a detailed level. However, it shows the relationships of the processes which are used when implementing the QMS.
Fig 3 Model of a process based quality management system
QMS principles
QMS is based on eight quality management principles. These principles are used as a guide for the organization to improve its performance. These eight principles provide the basis for the performance improvement and are described below and shown in Fig 4.
Customer focus – Organization depends on its customers and hence is to understand present and future needs of the customer. It is to meet customer requirements and strive to exceed customer expectations. The key benefits of customer focus are (i) increased revenues and market share achieved through flexible and fast responses to market opportunities, (ii) increased effectiveness in the use of the organizational resources to enhance customers’ satisfaction and (iii) improved customer loyalty to repeat business.
Leadership – Leaders establish unity of purpose and direction of the organization. They create and maintain the internal environment in which people can become fully involved in achieving the organizational objectives. The key benefits of leadership are (i) motivation of the employees and their understanding of the organizational goal and objectives, (ii) evaluation of the activities and their alignment and implementation in a unified way, and (iii) minimization of the miscommunication between different levels of the organization.
Involvement of employees – Employees at all the levels are the essence of the organization and their full involvement enables their abilities to be used for the organization’s benefit. The key benefits are (i) motivated, committed and involved employees within the organization, (ii) innovation and creativity in furthering the objectives of the organization, (iii) accountability of employees for their own performance and people’s participation and (iv) contribution to continual improvement.
Process approach – A desired result is achieved in more efficient manner when activities and related resources are managed as a process. The key benefits are (i) lower costs and shorter cycle times through effective use of resources, (ii) improved, consistent, and predictable results, and (iii) focused and prioritized improvement opportunities.
System approach to management – The effectiveness and efficiency of the organization in achieving its objectives are enhanced by identifying, understanding, and managing the interrelated processes as a system. The key benefits are (i) integration and alignment of the processes which achieve best the desired results, (ii) ability to focus efforts on the processes, and (iii) providing confidence to the interested parties as to the consistency, effectiveness and efficiency of the organization.
Continual improvement – Continual improvement of the overall performance of the organization is to be a permanent objective of the organization. The key benefits are (i) performance advantage through the improvement in the organizational capabilities (ii) alignment of the improvement activities at all levels to the strategic intent of the organization, and (iii) flexibility to react quickly to the opportunities.
Factual approach to decision making – Decisions which are based on the analysis of data and information are most effective. The benefits are (i) informed decisions (ii) increased ability to review, challenge, and change opinions and decisions, and (iii) an increased ability to demonstrate the effectiveness of the past decisions through reference to the factual records.
Mutually beneficial supplier relationship – The organization and its suppliers are inter-dependent and a mutually beneficial relationship improves the ability of both to create value. The key benefits are (i) increased capability to create value for the parties, (ii) flexibility and speed of joint responses to changing market or customer needs and expectations, and (iii) optimization of costs and resources.
Fig 4 Quality principles for quality management system
Documentation
Documentation enables communication of intent and consistency of action. Its use contributes to (i) achievement of conformity to customer requirements and quality improvement, (ii) provision of appropriate training, (iii) repeatability and traceability, (iv) provision of objective evidence, and (v) evaluation of the effectiveness and continuing suitability of the QMS. Generation of documentation is not to be an end in itself but is tobe a value-adding activity.
The types of document which are used in QMS include (i) documents which provide consistent information, both internally and externally, about the organization’s QMS (such documents are referred to as quality manuals),(ii) documents which describe how the QMS is applied to a specific product, project or contract (such documents are referred to as quality plans), (iii) documents stating requirements (such documents are referred to as specifications, (iv) documents stating recommendations or suggestions (such documents are referred to as guidelines), (v) documents which provide information about how to perform activities and processes consistently (such documents can include documented procedures, work instructions, suppliers manuals, and drawings etc.), and (vi) documents which provide objective evidence of activities performed or results achieved (such documents are referred to as records).
The organization is to determine the extent of documentation needed and the media to be used. This depends on several factors such as the type and size of the organization, the complexity and interaction of processes, the complexity of products, customer requirements, the applicable regulatory requirements, the demonstrated ability of personnel, and the extent to which it is necessary to demonstrate fulfillment of QMS requirements. Fig 5 shows the documentation for QMS.
Fig 5 Documentation for quality management system
Documentation requirements of QMS includes (i) quality policy, (ii) quality manual to describe the system, (iii) quality objectives register to document the quality objectives, (iv) control of documents procedure, (v) control of records procedure, (vi) internal audit procedure, (vii) control of non-conforming product procedre, (viii) corrective action procedure, (ix) preventive action procedure, (x) quality plan, (xi) control plans, (xii) other documents as necessary, and (xiii) records (to show evidence of work performed in all QMS processes. Fig 6 shows hierarchy of QMS documents.
Fig 6 Hierarchy of QMS documents
Implementation of QMS
The implementation process for QMS is important in achieving the full benefits of the QMS. Majority of the new users achieve measurable pay-back early in the process. For a successful implementation of the QMS, the following seven steps are important.
Step 1 – Organizational top management is to define (i) the purpose of implementing the QMS in the organization, (ii) the mission, vision, and values for the organization, (iii) the stake-holders of the organization such as customers, suppliers, share-holders, employees, and society etc. (iv) quality policy, and (v) to define and align organizational objectives and related product or service quality objectives.
Step 2 – The key processes and the interactions needed to meet the quality objectives are to be identified.
Step 3 – Quality system and its processes are implemented and managed using process management techniques.
Step 4 – QMS is build by (i) identifying the QMS requirements, (ii) mapping the requirements with the implemented quality system, where applicable, (iii) making a gap analysis by identifying where in the existing system the requirements are fulfilled, and where they are not, and (iv) the activities, procedures, and controls needed are included in the processes of the QMS.
Step 5 – Organizational employees are trained in QMS procedures and controls for effective operation of the processes. QMS is implemented and the effective operations of the processes are verified.
Step 6 – QMS is managed by focusing on (i) customer satisfaction, (ii) monitoring and measuring the operation of the QMS, and (iii) striving for continual improvement. Implementing business excellence models in the operations of the organization is to be considered.
Step 7 – If necessary, third party certification / registration of the QMS are to be obtained or alternatively, a self-declaration of conformity can be declared.
QMS and the Plan-Do-Check-Act (PDCA) cycle
The Plan-Do-Check-Act (PDCA) cycle is the foundation of the QMS. The PDCA cycle enables the organization to ensure that its processes are adequately resourced and managed, and that the opportunities for improvement are determined and acted on. Risk based thinking enables the organization to determine the factors which can cause its processes and its QMS to deviate from the planned results, to put in place preventive controls to minimize negative effects, and to make maximum use of opportunities as they arise. The PDCA cycle can be applied to all the processes of the QMS and to the QMS as a whole.
PDCA cycle in the case of QMS consists of (i) ‘Plan’ which constitutes establishment of the objectives of the system and its processes, and the resources needed to deliver results in accordance with customers’ requirements and the organizational policies, and identify and address risks and opportunities, (ii) ‘Do’ means implementation of the plans, (iii) ‘Check’ means monitoring and (where applicable) measuring processes and the resulting products and services against policies, objectives, requirements and planned activities, and report the results, and (iv) ‘Act ‘ means taking actions to improve performance, as necessary. This process then continues, thereby driving continual improvement at every level of the organization. Fig 7 shows QMS and PDCA cycle.
Fig 7 Quality management system and PDCA cycle
Quality management standards
ISO 9000 is a family of quality management systems (QMS) standards created by the International Organization for Standardization (ISO), a federation of 132 national standards bodies. There are 26 standards under this family. The ISO 9000 QMS standards are not specific to products or services, but apply to the processes which create them. The standards are generic in nature so that they can be used by manufacturing and service industries anywhere in the world. The ISO 9000 family of international quality management standards and guidelines has earned a global recognition as a basis for establishing effective and efficient QMS. In developing QMS in the organization, the fundamental concepts and principles given in ISO 9000 can provide valuable guidance.
ISO standards apply a process approach. Processes are recognized as consisting of one or more linked activities which need resources and are to be managed to achieve predetermined output. The output of one process can form directly the input to the next process and the final product is frequently the result of a network or system of processes
‘ISO 9001, Quality management systems – Requirements’ specifies the basic requirements for a QMS which the organization is required to fulfill to demonstrate its ability to consistently provide products (which include services) which enhance customers’ satisfaction and meet applicable statutory and regulatory requirements. It specifies the basic requirements against which the QMS of the organization can be certified by an external body and can be used for certification / registration and contractual purposes by the organization seeking recognition of its QMS. The standard recognizes that the term ‘products and services’ applies to services, processed material, hardware, and software intended for the customer. ISO/TC 176 maintains a database of approved interpretations of the ISO 9001 standard.
‘ISO 9004 Managing for the sustained success of an organization – A quality management approach’ gives guidance on a wider range of objectives of a QMS than ISO 9001, particularly in managing for the long-term success of the organization. It is used to extend the benefits obtained from ISO 9001 to all parties which are interested in or affected by the operations of the organization. Interested parties include the organizational employees, owners, suppliers, partners, and society in general. ISO 9004 is recommended as a guide for organizations whose top management wishes to extend the benefits of ISO 9001 in pursuit of systematic and continual improvement of the organizational overall performance. However, it is not intended for certification or contractual purposes. Both ISO 9001 and ISO 9004 are compatible and can be used separately or in combination to meet or exceed expectations of customers and interested parties. Both standards apply a process approach.
ISO 9001 has been organized in a user-friendly format with terms which are easily recognized by all business sectors. The organization gets the greatest value by using the entire family of standards in an integrated manner. It is highly desired that the organization uses ISO 9000 to become familiar with the basic concepts and the language used before the organization adopt ISO 9001 to achieve a first level of performance. The practices described in ISO 9004 can then be implemented to make the QMS more effective and efficient in achieving the organizational goals and objectives. The ISO 9001 and ISO 9004 standards have been written to enable the organization to relate them to other management systems (e.g. environmental), or to sector specific requirements and to assist the organization in gaining recognition through national or regional award programmes.
‘ISO 19011, Guidelines for auditing management systems’, covers the area of auditing of QMS and environmental management system. It provides guidance on audit programmes, the conduct of internal or external audits, and information on auditor competence. It provides an overview of how an audit programme is to operate and how management system audits are to take place. Effective audits ensure that an implemented QMS meets the requirements specified in ISO 9001.
The nature of the organization and its specific needs determine how to apply these standards to achieve the organizational goals and objectives. Useful hints and tips for conducting audits have been developed by the ISO 9001 Auditing Practices Group. Information on third-party auditing has also been compiled by the joint ISO-IAF (International Accreditation Forum) Accreditation Auditing Practices Group. The implementation process is important in achieving the full benefits of the QMS.
The organization can get the greatest value by using the entire family of ISO 9000 standards in an integrated manner. It is highly desired to use ISO 9000 to become familiar with the fundamental concepts, principles and normative vocabulary of a QMS before the organization adopt ISO 9001 to achieve an effective level of performance. ‘ISO 9000, Quality management systems – Fundamentals and vocabulary’, provides the fundamental concepts, principles and vocabulary used in the entire ISO 9000 family of standards. It sets the stage for understanding the basic elements of quality management as described in the ISO standards. The practices described in ISO 9004 can then be implemented to make the QMS more efficient in achieving the organizational goals and objectives.
ISO 9000 introduces users to the seven quality management principles (QMPs) as well as the use of the process approach to achieve continual improvement. These seven principles are fundamental attributes of the QMS. They have been taken from ‘ISO 9000:2015 Quality Management Systems – Fundamentals and Vocabulary’ and have served as a basis for the new ISO 9001:2015 standard. These seven QMPs are key principles which set out the rationale behind how a good organization is managed. They guide the organization on a path of continual improvement to ensure sustainability, particularly in changing times. These principles themselves are not directly auditable, but their application within the standard is.
The seven QMPs are (i) customer focus, (ii) leadership, (iii) engagement of people, (iv) process approach, (v) improvement, (vi) evidence-based decision making, and (vii) relationship management. These principles are not listed in priority order. The relative importance of each principle varies from organization to organization and can be expected to change over time. Collectively, they can form a basis for performance improvement and organizational excellence. There are several different ways of applying these QMPs. The nature of the organization and the specific challenges it faces determine how to implement them. Several organizations find it beneficial to set up a QMS based on these principles.
Customer focus – It is essential for the organization to understand present and future customer needs. The organization is to strive to meet customer requirements and exceed customer expectations. This can be done by communication throughout the organization, measuring customer satisfaction, and systematically managing customer relationships. Ensuring a balanced approach and acting on findings is important.
Leadership – Leaders are to provide a clear vision of the future of the organization and set challenging goals and targets. It is only through unity of purpose and direction of employees, the objectives of the organization are achieved. Leaders are to maintain an internal environment where people can get fully involved by establishing trust and eliminating fear.
Engagement of people – People are to be a core competency of the organization. Involving people and their abilities at all levels can only benefit the organization. Motivating people, holding them accountable for their own performance and involving them in decision making inspires innovation and creativity.
Process approach – Managing activities and resources as a process gives clear indications of what all the inputs and outputs are and hence gives a clearer idea of how to achieve the desired outcomes.
Improvement – Continuously improving the organizational processes and systems and hence improving the organizational overall performance is to be a permanent organizational objective.
Evidence-based decision making – Decisions are to be based on the analysis of reliable and accurate data and information. Analysis combined with experience and intuition is a powerful decision making tool.
Relationship management – The enhancement of the ability to create value depends on the relationships with suppliers. There is to be a balance between short term gains and long term considerations which then results in increased flexibility and optimization of costs and resources.
‘ISO 9001, Quality management systems – Requirements’, is used when an organization is seeking to establish a QMS which provides confidence in the ability of the organization to provide products which fulfill customer needs and expectations. There are seven clauses in the standard specifying activities which need to be considered when the organization implements the system. These clauses are (i) context of the organization, (ii) leadership, (iii) planning, (iv) support, (v) operation, (vi) performance evaluation, and (vii) improvement. The requirements in all sections of ISO 9001 are applicable. The organization is required to provide justification for any requirement of this International Standard which the organization determines is not applicable to the scope of its QMS. A manual, or other documented information, demonstrate how the organization meets the ISO 9001 requirements.
ISO 9001 defines what the organization is to do to consistently provide product which meets customer expectations and applicable statutory and regulatory requirements. In addition, the organization is to seek to enhance customer satisfaction by continual improvement of the QMS.
The organization which likes to have ISO certification needs to meet all the criteria stated in the ISO standards and to pass a detailed audit performed by an ISO auditor. In some industries ISO certification has become necessary; for example, some large manufacturers require all suppliers to be ISO certified. While ISO certification is highly respected, if it is not a trend in the specific industry in which the organization operates, the additional cost of certification is a deterrent to most managers. It is very possible to reach the desired quality level within an organization with a well planned QMS and without going through all the additional steps for ISO certification.
For a successful implementation of QMS, the seven steps which are helpful as guidance are (i) engaging the top management to agree on why to implement a QMS, to determine the context of the organization, strategic objectives and business processes, to determine customer and interested parties’ needs and expectations, to understand the QMPs described in ISO 9000, to review the implication of risk-based thinking, to define the objectives of the organization, to describe the scope of the QMS, to define the policy, and to determine quality objectives, (ii) identifying key processes consisting of identifying the processes needed to deliver products and services, understanding the ISO 9001 requirements, and determining the risks and opportunities applicable to the processes, (iii) planning the QMS consisting of identifying the gaps in the existing system compared to QMS requirements, identifying the process controls needed, defining the working environment needed, and defining the skills and facilities needed, (iv) preparing the documents of the QMS which include documentation of the processes, activities and controls needed, preparing the documented information (procedures and records) required by the standard and according to the needs, and ensuring the QMS conforms to ISO 9001 requirements, (v) implementation of the QMS consisting of managing the processes, controlling the monitoring and measuring of equipment, training of the employees, and verifying effective operation of the processes, (vi) management of the QMS consisting of monitoring and measuring of the performance, auditing process effectiveness, focusing on the customer satisfaction, managing the system and operational change, and performing management review, and (vii) improving the QMS, by seeking third-party certification / registration of the QMS, striving for improvement with reference to ISO 9004, and considering the implementation of the business excellence models in organizational operations.
High level structure
As a result of the new arrangement in ten clauses, ISO 9001:2015 now has the same unambiguous structure as all standardized management systems, known as a ‘High Level Structure’ (HLS). The core elements of ISO 9001, ISO 14001, ISO 22000, and ISO 45001, etc. are hence all the same. This has made the integration of various management systems much simpler. If, for example, an organization wishes to implement ISO 14001 in addition to ISO 9001, the parts which cover the same topic can easily be seen in the standards.
The structure of ISO 9001:2015 adopts the Annex SL template mandated for all ‘discipline-specific’ standards which consist of (i) high level structure, (ii) identical core text, and (iii) common terms and core definitions. The HLS consists of the clause sequence consisting of 0. Introduction; 0.1 General; 0.2 The ISO standards for quality management; 0.3 Process approach; 0.4 Plan-Do-Check-Act (PDCA) cycle; 0.5 ‘Risk-based thinking’; 0.6 Compatibility with other management system standard; 1 Scope; 2 Normative references; 3 Terms and definitions; 4 Context of the organization; 5 Leadership; 6 Planning; 7 Support; 8 Operation; 9 Performance evaluation; 10 Improvement; Annex A (informative) clarification of new structure, terminology and concepts; Annex B (informative) quality management principles; Annex C (informative) the ISO 10000 portfolio of quality management standards ; and Bibliography.
The HLS enhances the consistency and alignment of different management system standards (e.g. ISO 9001 and ISO 14001). The MSS (management system standards) requirements are contained in clauses 4 to 10 which include some 45 ‘shall statements’ giving rise to 84 mandatory requirements. These are considered to be the minimum requirements so ‘the disciplines’ (e.g. aerospace / defence, automotive / motorsport, rail, and nuclear, etc.) can add in their own needs, which results in more sector-specific requirements.
Important features of ISO 9001:2015
ISO 9001:2015 puts more focus on input and output. There is more emphasis in ISO 9001:2015 on measuring and properly assessing the input and output of processes. According to ISO 9001:2015, the organization is to closely monitor which articles, information, and specifications are involved in the production process. It is also to clearly check whether good articles come out of the production process. The major features of ISO 9001:2015 are given below.
Risk-based thinking is at the core of ISO 9001:2015 – Risk-based thinking has a very important place in ISO 9001:2015. Organizations are now strongly encouraged to use risk analysis in order to decide which challenges they see in the management of their business processes. Formal risk analysis, familiar to many organizations via FMEA (failure mode and effects analysis) or HACCP (hazard analysis and critical control points) techniques, is now standard for everyone. To emphasize their dominance, the concept of ’risk’ occurs 48 times in ISO 9001:2015, compared with only three times in ISO 9001:2008. The addition of risk-based thinking has made the ‘preventive measures’ of ISO 9001:2008 redundant. These preventive measures no longer appear in ISO 9001:2015.
The requirement for preventive action has been replaced by risk-based thinking. This concept is addressed in the ISO 9001:2015 requirements for planning, review, and improvement of the QMS processes. Applying risk-based thinking can assist in deciding the type and extent of documented information which is necessary. There is no requirement for formal methods for risk management or a documented risk management process. Consequently organizations can decide whether or not to adopt more extensive risk management approaches, for example the use of (i) SWOT (strengths, weaknesses, opportunities, and threats} during the analysis of external and internal issues which are relevant to their operations and business, (ii) P-diagrams, DFMEA (design failure mode and effect analysis, and FTA (fault tree analysis) in product design, (iii) process-flowcharts and PFMEA (process failure mode effects analysis) during new product introduction focused on production methods, and (iv) risk register (based on PEST (Political, Economic, Social, and Technological factors) for supplier selection and evaluation.
The benefit of risk based thinking is multifold. This approach enables the organization to respond to change effectively to protect their business. Organizations need to start using a risk-driven approach in their organizational processes. A systematic analysis of prioritized risks and opportunities help effective decision making and ensures that the management is prepared to manage and mitigate risks, plan actions to address the risks, implement the action plan to avoid, eliminate or mitigate risk by taking necessary actions, on time. This also helps organizations to identify the risks and opportunities depending on the context of the organization and its risk appetite (the amount of risk the organization is willing to accept and live with). There is a proactive approach which helps improve operational efficiency and enables organizations to apply management system to analyze risk and minimize losses. Risk is to be assessed for factors which have influence on ‘Quality of Goods and Services’ and ‘Timeliness’ on delivery which assures consistency of quality of goods or services and thereby improves customer confidence and satisfaction. Risk-based thinking establishes a proactive culture of improvement. Leadership, a new clause has been introduced in place of Management Responsibility.
Organizational knowledge – Knowledge has become a key to successful operations, new product introduction, and business development in general. ISO 9001:2015 considers knowledge like any other resource and it is to be acquired and managed. The organization is required to identify the knowledge necessary to carry out its operational and business activities in compliance with the QMS and to achieve the defined objectives. Such knowledge can be based on internal sources (methoding, simulations, work instructions, technique cards, results of corrective actions, customer feedback, and so on) and external sources (universities, professional bodies, technical standards, conferences, consulting organizations, and so on). Once acquired, it is to be maintained, protected and made available, where necessary.
The organization is to anticipate changes in knowledge needs and manage the risk of failing to acquire knowledge in due time. Whatever the source, organizational knowledge is useful and useable information specific to the organization, It is gained by experience and the proactive search for solution to operational and business challenges. It is information which is used and shared to achieve the organizational objectives.
Leadership and the quality manager – Leadership now replaces management responsibility in line with the EFQM (European foundation for quality management) model. The organizational top management is now to demonstrate that they are actively involved in the operation of the QMS. The removal of all references to the role of management representative serves to reinforce the need to see the QMS embedded into routine business operations, rather than operating as an independent system in its own right with its own dedicated management structure.
Although there is no specific requirement for a management representative it is likely that organization selects a specific member of management oversee the operation of the QMS and has unrestricted access to top management. It is inevitable that ‘traditional’ quality assurance activities such as calibration control, inspection / test, control of non-conforming product, internal auditing, etc. remain the area of quality managers and their team.
Control of non-conforming outputs – The clause ‘control of nonconforming outputs’ replaces ‘control of non-conforming product’ and includes non-conforming product or service generated internally, received from an external provider, or identified by a customer. It is likely that the organization still defines its arrangements for (i) defining the responsibility and authority for reviewing and dealing with non-conforming outputs and the process for approving persons making these decisions, (ii) taking actions necessary to contain the effect of the non-conformity on other processes, products, or services, and (iii) defining corrective actions for non-conforming products and services detected after delivery, as appropriate to their impacts. In addition, the contractual arrangements for the acceptance of non-conforming products by means of concessions and the disposition of scrapped products are also to be addressed.
Context of the organization – ISO 9001:2015 needs the organization to construct its QMS from the specific context within which it is active. This means, among other things, organization has to take into account the needs and expectations of interested parties and evaluate and deal with internal and external strategic questions. Organization is to understand and respond to the expectations of all the parties concerned. A new clause (clause 4.1) is introduced relating to the organization and its context, which needs the organization to determine the issues and requirements which can impact on the planning and development of the management system. This is a welcomed addition as it provides the opportunity to define the business – what is achieved for customers (i.e. the purpose) and the direction in which the organization is heading (i.e. its strategic direction). A common approach to defining the purpose of the organization is to agree on the mission, vision, and values.
Mission is the organization’s purpose and reason for existing. Mission concentrates on the present. A mission statement defines the fundamental purpose of the organization. It identifies who the organization is, what it does, and to whom it serves. The mission statement is to communicate the scope and scale of the organization’s operations, in an easily understandable manner. It describes what the organization does with particular focus on what it does for its customers and other interested parties. It states clearly and concisely the business strategy, and provides personnel with a framework and purpose. Its purpose is to motivate its people, suppliers and other partners.
Vision is where the organization is going in the medium to long term. Vision focuses on the future. A vision statement is an aspirational description of the desired mid or long term achievements of the organization, by those involved or affected by it. It is what the organization wants to become – how the future will look when the mission is achieved. Its purpose is to motivate external people to work with the organization. It is the end destination for the organization’s ‘roadmap’: what it hopes to become; the customer outcome it wants to achieve; the market position it wants to assume; the impact it will have; the capabilities it plans to develop; and the activities it plans to pursue. When developing its vision, an organization needs to ensure its desired future is consistent with its existing values.
Values are what the organization stands for – its principles and ethics. Values identify the principles and ethics by which the organization and its members conduct themselves and their activities. Values underpin policies, procedures, strategies, missions and visions by acting as the foundation and a reference point for every decision made by the organization’s personnel.
It can be seen that the above mission, vision and value statements serve to direct and guide the organization over a sustained period of time. Collectively they define the purpose of the organization and are be a high-profile part of the QMS documentation. With the organization’s purpose and strategic direction defined, it is required to determine external and internal issues which can impact on their achievement and that also affect its ability to achieve the intended result of its QMS.
Benefits of QMS
A fully documented QMS ensures meeting of the two important requirements namely (i) the customers’ requirements which means that QMS gives confidence in the ability of the organization to deliver the desired product and service consistently meeting their needs and expectations, and (ii) the organizational requirements which QMS meets both internally and externally and at optimum cost with efficient use of the available resources which are materials, human, technology and information.
The benefits of QMS include (i) better quality of products and services, (ii) lesser waste of resources (time and materials), (iii) improved customer satisfaction, (iii) improved profitability and improved bottom line, (iv) improved corporate image, (v) help the organization in achieving the goals and objectives, (vi) give competitive advantage by providing confidence to customers which in turn helps the organization in market positioning and increased market share, (vii) reduced warranty / liability claims through defect reduction, (viii) ability to focus on process effectiveness and efficiency, (ix) improved records in case of litigation, (x) reduction of need for multiple second party assessment, (xi) improves traceability to ‘root causes’ of quality problems, (xi) independent, impartial, and professional verification, (xii) results in errors rectified, at the earliest stage-not repeated, (xiii) clear defining of responsibilities and authorities, (xiv) providing transparency of operations within the organization, (xv) facilitating employees’ training activities, and (xvi) involving employees in decision making process and hence raising their morale.
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