Chapter Three ISO 9000:2000 Quality Management System

Chapter Three

ISO 9000:2000 Quality Management System

Introduction Quality Systems – Approach recognizes continuous Improvement in Quality can be best achieved through planning and preventing problems form arising at source with the introduction of Quality Control Tools and Techniques.

Quality Inspection –identifying defects in the Product/service before they reach the customer by “Inspection Stage or stages. Against the specification

Quality Control – ensures certain level of quality in a product/service. Whatever actions a business deems necessary to provide for the control and verification of certain characteristics of a product or service.

Quality Assurance – Recognizes the inherent inefficiency of waiting for the mistakes to happen. Analysis of Nonconformance in a systematic manner. Design Quality into the process and practices

Why Standards Matter

• Standards make an enormous and positive

contribution to most aspects of our lives.

• Standards ensure desirable characteristics of

products and services such as quality,

environmental friendliness, safety, efficiency

and interchangeability - at an economical cost.

• When products and services meet our expectations,

we tend to take this for granted and be unaware of

the role of standards.

• However, when standards are absent, we soon

notice.

International Organization for Standardization (ISO)

• Central Secretariat in Geneva, Switzerland, that coordinates the system.

• ISO, officially began operations on 23rd February 1947.

• ISO standards are developed by “Technical Committees” comprising experts from the industrial, technical and business sectors which have asked for the standards, and usage.

The name derived from the Greek word “isos”

meaning "equal".

From "equal" to "standards" that lead to the choice

of "ISO" as the name of the organization.

ISO is a non-governmental organization with its

members drawn from 120 countries, currently is

made up of 130 national standards institutes or

organizations.

ISO: International Organization for Standardization

• To date, ISO's work has resulted in over

19 000 International Standards, representing

some 750 000 pages in English and French

(terminology is often provided in other

languages as well).


History of ISO 9000 Series

• In the year 1985 the Quality Management systems Concept came into the Existence by ISO

• In the year 1987 First Guidelines as requirements of Quality Management Systems has been published for the Purpose of Certification.

• In the year 1994 First revision took place to make it more practical for the Implementation and Simple to understand. Four Standards published ISO 9001, ISO 9002, ISO 9003, ISO 9004.

• In year 2000 Second revision took place to make it generic for the application in any type of Industry and simplified form the Audit Point of View.

• 15th November 2008 Third revision published to give more clarity for implementation and use.

ISO 9000 and ISO 14000 in brief

• ISO 9000 and ISO 14000 are among ISO's most

well known standards ever.

• They are implemented by more than a million

organizations in some 175 countries.

• ISO 9000 helps organizations to implement

quality management system.

• ISO 14000 helps organizations to implement

environmental management system.

Management System

• Management system means

“What the organization does to manage its

processes, or activities in order that its

products or services meet the

organization’s objectives, such as

satisfying the customer's quality

requirements, complying to regulations, or

meeting environmental objectives”

Management System

• To be really efficient and effective, the

organization can manage its way of doing

things by systemizing it, i.e.:

– Nothing important is left out.

– Everyone is clear about who is responsible for

doing what, when, how, why and where.

• ISO Management system standards provide

organizations with an international, state-of-

the-art model to follow.

Management System

• Large organizations, or ones with complicated

processes, could not function well without proper

and effective management systems.

• Companies in fields such as aerospace,

automobiles, defense, or health care devices have

been operating management systems for years.

• The ISO 9000 and ISO 14000 management system

standards now make these successful practices

available for all organizations.

Quality management

ISO 9000 is for quality management.

• Quality refers to all those features of a product

(or service) which are required by the customer.

• Quality management means what the

organization does to:

– Ensure that its products or services satisfy the

basic customer's quality requirements and

– Comply with any regulations applicable to

those products or services.

Quality management

• Quality management also means what

organization does to

– Enhance customer satisfaction and exceed

their expectations, and

– Achieve continual improvement of its

performance.

Principles of Management Systems

• Customer focus • Leadership • Involvement of people • Process approach • System approach to management • Continual improvement • Factual approach to decision making • Mutually beneficial supplier

relationships

Generic Standards

ISO 9000 and ISO 14000 are generic standards.

Generic means that the same standards can be

applied:

– To any organization, large or small,

whatever its product or service,

– In any sector of activity, and

– Whether it is a business enterprise, a public

administration, or a government department.

Generic Standards

Generic also signifies that

• No matter what the organization's scope of

activity is, if it wants to establish a quality

management system, ISO 9000 gives the

essential features

• Or if it wants to establish an environmental

management system, ISO 14000 gives the

essential features.

Processes, not Product

• Both ISO 9000 and ISO 14000 concern the way

an organization goes about its work.

– They are not product or service standards, they are

process standards.

– They can be used by both product manufacturer and

service providers

• Processes affect final products or services.

• ISO 9000 gives the requirements for what the

organization must do to manage its processes

affecting quality of its products and services.

Schematic Representation of Process


The ISO 9000 family of standards represents an

international consensus on good management

practice.

Its primary aim is to give organizations guidelines on what

constitutes an effective quality management system,

which in turn can serve as a framework for continuous

improvement.

The ISO 9000 family of International Standards for quality

management has 12,900 standards published since it

began operations in 1947.

The ISO Survey

i) ISO 9001:

Is one of the standards and it is a model for

quality assurance in design, development,

production, installation and servicing.

ii) ISO 9002:

Is a model for quality assurance in production,

installation and servicing for an already

established design.


iii) ISO 9003:

This is a model for quality assurance in final

inspection and testing.

iv) ISO 9004:

This is quality management and quality

systems elements: guidelines. This provides

the users in the process of developing in-

house quality systems.


ISO 9000 is not a product quality label or

guarantee. Compliance with the standards

verifies product repeatability: products

produced under a specified standard will have

similar dimensions of quality

In conclusion, ISO 9000 should be seen as a first

step in continuing improvement while the

customer requirement may be more than the

general application of the standard


A quality management system is the way

organization directs and controls those businesses

activities, which are associated with quality.

Broadly, it consists of organizational structure

together with the planning, processes, resources and

documentation that you use to achieve your quality

objectives, to provide improvement of your products

and services and to meet your customer’s

requirements.


Quality Management system standards should

not be confused with product standards

The use of product standards, quality

management system standards and quality

improvement approaches are all means of

improving your customers’ satisfaction and

the competitiveness of your business and

they are not exclusive of each other


ISO 9000:2000 promotes the adoption of a process

approach

Process approach refers to the application of system

of processes within an organization, together with the

identification and interactions of these processes,

and there management

An advantage of the process approach is the ongoing

control that it provides over the linkage between the

individual processes within the system of processes,

as well as their combination and interaction


Process approach emphasizes the importance

of:

1. Understanding and meeting requirements

2. The need to consider processes in term of

added value

3. Obtaining results of process performance and

effectiveness, and

4. Continual improvement of processes based

on objectives measurement

Conceptual model of ISO 9000: 2000 Quality Management Systems

30

Deming Prizes (1951)

Malcolm Baldrige National Quality Award (1987)

Australian Quality Award (1988)

European Quality Award (1991)

The Ethiopian Quality Award (EQA) Assessment Model (2007)

EQA 1. Leadership

Commitment to excellence and continuous

improvement

Development and deployment of policies &

strategies

Allocation of appropriate resources

Motivation and recognition of employee’s effort

Customer relationship management

Leader’s involvement in achieving organizational

objectives

Public responsibility

EQA 2. Policy and strategy

Relevant policy and procedures

Sound & focused strategy

Deployment of policies and strategies

EQA 3. Resource management

Targeted human resource development &

management

Optimized material resource management

system

Effective financial resource management

Efficient facilities management

Knowledge based information resource

management

EQA 4. Processes Optimized product/ service process

Synergized service processes

Proper planning & control

Integrated business process

Review and improvement of processEQA 5. Customer

satisfaction/focus Exceeding external customers’ expectation

Meeting internal customers’ satisfaction

Review and evaluation of customers’

satisfaction

Level of product/ service quality

EQA 6. Business Performance

Degree of financial performance

High market share

Increased productivityEQA 7. Impact on society

Significant socio-economic impact

Enhanced environmental impact

Provision of resources

Human resources

Infrastructures

Work environment

Resource Management

General requirements

Documentation Requirements

Planning

Customer related processes

Design & development

Purchasing

Production & service provision

Management CommitmentCustomer focus

Quality policy

Planning

Responsibility, authority & communicationManagement Reviews

Management Responsibility

Measurement Analysis & improvement

System Requirements

Quality Management System

Product Realization

General

Monitoring & measurement

Control

Analysis of data

Improvements

Benefits of implementing quality management system

Internal benefits Improved management confidence Improved awareness of company

objectives Improved communications Responsibilities and authorities are

adequately defined Improved traceability to root cause of

quality problems Improved utilization of resources

Fewer rejects, therefore, less repeated work and warranty costs

Errors rectified at the earliest stage, and not repeated

Continuous improvement

Increased productivity

Increased profits and company growth

External benefits Easy access to international market

through demonstration of competence and improving competitiveness

Improved customer satisfaction

Consistency in quality of products and services

Customer confidence (reduces the amount of inspection)

Improved company image

Role of employees in quality management

Accept ownership and responsibility to solve problems

Actively seek opportunities to make improvements

Actively seek opportunities to enhance their competencies, knowledge and experience

Freely share knowledge and experience in teams and groups

Being innovative and creative in furthering the organization’s objectives

Better representing the organization to customers, local communities and society at large

Deriving satisfaction from their work

Be enthusiastic and proud to be part of the organization

Focusing on the creation of value for customers

Market Impact Of ISO 9000

The customer is the focal point for all businesses to survive in any market – locally, nationally, and globally

Customer’s needs and requirements are important

ISO 9000 establishes a set of rules and regulations to avoid poor-quality products and services for a variety of customers

Importance to Marketing and Sales

The degree of positive impact depends on the degree of involvement in the certification process

Customers can be confident in a company that knows the importance of quality assurance

A stepping stone to improve quality products and true customer focus

Reasons for Companies to Comply

A study conducted by Rayner and Porter:

35% - Pressured by customers

15% - Need to anticipate

registration

15%- Access new markets

10% - Other reasons

10% - Improve quality

15% - Gain competitive advantage

80% of the firms considered marketing as the main reason to be certified by ISO 9000

Other reasons:

Comply with public projects

Government requirements

Overseas trade and market

Pressure from larger businesses

Reduce time failure

Reduce costs of customers’ claims

Improve customer service and customer loyalty

To get things done right the first time

Benefits from Certification

A study conducted by McAdam and McKeown

Northern Ireland/Europe 37% - Increased productivity

23% - Internal benefits (i.e. reduced cost)

14% - Greater control

37% - of the businesses received benefits within the first year of ISO 9000 Certification

Other benefits:

Quality improvement

Enhance competitiveness of company

Cost reduction

Sales increase

More systematic record keeping

Improved internal communication and performance

Continual improvement of operation

Here are two examples

Example 1 A metal parts fabricating company used ISO 9000:2000 to

develop a plan to implement their quality management system.

They prepared a quality manual and quality system procedures, excluding the requirements covering product design and development because their products are designed by their customers.

Later, in order to bid on the supply of parts to a major automotive company, they adapted their quality system to meet the sector of specific requirements

Example 2

A welfare agency decided to establish a quality improvement strategy.

It adopted ISO 9004:2000 as the basis for planning and implementing its system.

The agency found that ISO 9000:2000 provided very useful additional guidance and plans to seek certification to ISO 9001:2000 to gain more credibility.

In Summary

Quality Audit:

Internal Quality Audit

Assessment done by independent out side Auditors Done as per International Standards.

Helps in identification, Traceability of records.

Evaluation of over all working of different Offices/ Maintenance Centers.

MIS Reports:

Enables to monitor the rectification of Faults and

Completion of Works as per the Quality Objectives.

Cases not complying with the Quality Objectives are Identified, discussed for the Corrective Action.

Benefits Of ISO 9001:2000 Certification

Importance to Marketing and Sales

The degree of positive impact depends on the degree of involvement in the certification process

Customers can be confident in a company that knows the importance of quality assurance

A stepping stone to improve quality products and true customer focus

Real World Examples

“FedEx’s worldwide ISO 9001 certification gives us a

competitive advantage in the global market-place, especially

as more countries adopt ISO standards”

-FedEx Chairman and CEO Frederick W. Smith

Real World Examples“At IBM, the ISO 9000 standards have

proven to be a template for the creation of a sound quality system, regardless of

whether the target market is located in the United States or overseas. By embarking on

the ISO 9000 journey, it is reasonable to expect lower costs, improved customer satisfaction, greater brand loyalty, and

stronger market performance associated with this quality effort. The ISO 9000 quality

process can be an important step on the road to total quality management.”

IBM Director of ISO 9000 , Dr. Jack E. Small

How to implement ISO 9000

1. Decide whether to do it or not

There are many success stories of companies using ISO 9000

But this does not mean its guaranteed to boost profits

An assessment of whether ISO will benefit a company is required before proceeding

If a company decides to do it they need to commit to it


2. Select a quality manager

Find someone to be in charge of quality control

He/she should have an unbiased view of quality and the ability to communicate problems to the chief executive

3. Set up the ISO 9000 group

Traditionally a committee of all the managers from every department of the company grouped together to analyze processes and come up with better solutions and then document them



4. Foster employee confidence

Very important to the success of ISO 9000

Staff needs to be motivated to accept ISO otherwise it won’t work

Executives should set example by being excited about it

5. Write a Quality Policy

A mission statement stating the company’s commitment to the ISO standard and signed by the chief executive



6. Define employee responsibilities

Responsibilities must be clearly defined and stated for each employee

Employees that know exactly what they should be doing reduces confusion and inefficiency


7. Create a manual

A manual needs to be compiled of all the company’s processes and contain the best practices


8. Get audited

A company’s procedures are checked and allows for refinement and correction of errors

Competent auditing firm is required so all problems can be worked out


9. Get certified

Find an internationally well-known and credible group to certify the company

Allowed to announce certification to clients after this step


10. Maintain certification

ISO is not a one shot deal, it is a continuous improvement program

Maintain quality systems and gauge client satisfaction

Pursue continuous improvement and have an ISO 9000 maintenance team

Anticipate biyearly surveillance audits, there is the possibility of losing certification

Documents

Chapter Three ISO 9000:2000 Quality Management System