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The New ISO 9000 Standard Is A More Comprehensive Measure Of Quality

BY PAUL VRAGEL

The International Standards Organization's extensive overhaul of its 9000 quality standard makes the standard more useful for organizations seeking to improve performance and profitability. The new standard represents a change away from a procedure-driven system to one that is focused on results. Leadership, a customer focus, continual improvement and a process-based approach are the four principles adopted in the new standard.

The process-based approach, which permeates every area of the new standard, starts with understanding the interactions among the various areas of a company's business. Developing this understanding begins with a set of process maps that visually demonstrate the flow of work and information between and among these areas. The visual nature of these process maps makes it easier to see where there is "sand in the gears."

Other elements of a process-driven approach include establishing objectives, identifying the processes that support those objectives, making sure the resources and information needed for those processes is effective, establishing the measurement and monitoring necessary, and evaluating the results.

Using a process-based approach, companies have increased manufacturing yields by up to 80 percent, reduced processes from 35 steps to just six steps, and reduced turnaround time by up to 90 percent. Companies deploying the new system are creating new products for time-sensitive customers through better understanding of the company's own processes. Companies are also able to charge a premium price for a new product, consolidate procedures among departments and substantially reduce transaction times.

"We've seen the results of taking a process-based approach in a streamlining of our operations, reduced costs and improved turnaround time to our customers," says Elliot Goldman, president of Communication Coil, an aerospace electronics manufacturer. "We're also well on the way to getting our ISO 9001 (2000) certification based on processes and documentation that are in our own language, and makes sense for our business."

The new standard requires fewer specific procedures than the 1994 and 1987 versions. The trade-off is that you have to look at your own business, decide what processes you need to both serve your customers and support your operating requirements and document and manage those processes. The new standard avoids unnecessary documentation.

Leadership and Involvement

The new quality standard requires demonstration of top management's commitment to and participation in making the system effective. This is accomplished through assuring that measurable objectives are set and systems and processes are in place to meet those objectives. Having a better understanding of the processes of the business and the objectives of those processes creates additional opportunities for involvement of all employees in improvement of the system. No specific involvement approach is required by the standard.

Increased Focus on Customers

The 1994 standard required defining and documenting customer requirements. It required that companies review information "related to the customer's perception of whether the organization has met customer requirements." While customer satisfaction surveys are one way to meet this requirement, the surveys by themselves may provide limited data.

For instance, if a company sends out a survey and asks customers to rate their product delivery on a one-to-five scale, with five being the highest level of satisfaction, what action does a company take if the product delivery rating is 4.6 this month vs. 4.8 last month? The measure tells you little about the action required. Companies must know specifically the products involved and such things as whether they were purchased under blanket orders or emergency orders.

Process-based customer satisfaction indicators provide firms with specific information they can use to improve performance. These indicators measure interactions between companies and customers. A good indicator will have specific links to operating processes, so actions are tied to results.

While indicators will differ from one organization to the next, consider such elements as: trends in product rejections or returns; repeat orders for product; increasing volume of orders for product; trends in on-time delivery; trends in installation assistance required; service call volume and types of issues; and levels of pre-sales interaction and corresponding change requests.

Continual Improvement

Continual improvement is a new requirement in the year-2000 standard. Companies must be able to demonstrate that continual improvement is being achieved. This depends on effective application throughout the business of tools for improvement such as process mapping and process management, root cause analysis and problem risk analysis using prevention tools such as failure mode and effects analysis (FMEA). The key steps for action to achieve both next--level performance and certification are:

  • Start by understanding how your processes really work together (and not how you think they work!).
  • Involve the people who do the work every day in visually laying out those processes.
  • Capitalize on employees' expertise to help improve your processes and results.
  • Train employees to use tools for improvement such as process mapping, root cause analysis and problem risk analysis and prevention (through tools such as FMEA).
  • Eliminate procedures you have in place "only to meet the standard."
  • Re-focus your system on improving your business, not just meeting the standard.

-- Paul Vragel is president of Skokie, Ill.-based 4aBetterBusiness, Inc. (www.4abetterbusiness.com). He can be reached at 847-470-3513, or via e-mail at pvragel@4abetterbusiness.com