B Y A D I S S E R T A T I O N S U B M I T T E D I N P A R T I A L F U L F I L M E N T O F T H E R E Q U I R E M E N T S F O R T H E D E G R E E I N

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1 I S O : QUA L I T Y M A N AG E M E N T I N A C O N S U LT I N G E N G I N E E R I N G C O M PA N Y B Y M A R K P I T O U T A D I S S E R T A T I O N S U B M I T T E D I N P A R T I A L F U L F I L M E N T O F T H E R E Q U I R E M E N T S F O R T H E D E G R E E M AG I S T E R I N G E N E R I A E I N E N G I N E E R I N G M A N AG E M E N T I N T H E FAC U LT Y O F E N G I N E E R I N G A N D T H E BU I LT E N V I RO N M E N T A T T H E U N I V E R S I T Y O F J O H A N N E S BU RG N O V E M B E R S U P E R V I S O R S : P R O F. L. P R E T O R I U S P R O F. J. H. C. P R E T O R I U S

2 A C K N O W L E D G E M E N T S My sincerest thanks and gratitude to: My wife, Karien, for her love, support and patience. My family, for their love and support. Professor Leon Pretorius, for his guidance. Richard Baard, for his support and assistance. Roelene Botha, for convincing me to enrol in this masters degree program. And above all, God. MARK PITOUT NOVEMBER 2007 II

3 A B S T R A C T This dissertation provides a study of ISO 9001:2000 based quality management in the consulting engineering environment. The motivation for carrying out this study was to assess why an ISO 9001:2000 based quality management system was not operating effectively in a particular consulting engineering company. A brief literature study of the topic of Quality Management is given, as well as an overview of the ISO 9001:2000 standard. A case study is made of the particular consulting engineering company (called ABC Projects as a pseudonym for the sake of confidentiality). The case study presents the results of two questionnaires, one circulated among the employees of the consulting engineering company, and the other circulated among the directors of the Group that owns the company. The case study also contains an assessment of the company s quality management system at the hand of the ISO 9001:2000 standard. The assessment highlights various aspects of the company s quality management system that needed to be improved. The case study concludes with a 6-point plan aimed at improving the operational procedures of the company, as well the quality management system used by the company. MARK PITOUT NOVEMBER 2007 III

4 T A B L E O F C O N T E N T S ACKNOWLEDGEMENTS...II ABSTRACT...III TABLE OF CONTENTS...IV LIST OF FIGURES...V LIST OF TABLES...V LIST OF ABBREVIATIONS...VI CHAPTER 1 : INTRODUCTION PROLOGUE PROBLEM STATEMENT RESEARCH OBJECTIVES RESEARCH METHODOLOGY CONCLUSION...3 CHAPTER 2 : OVERVIEW OF QUALITY MANAGEMENT INTRODUCTION HISTORY OF QUALITY TOTAL QUALITY MANAGEMENT A MODEL CONCLUSION...12 CHAPTER 3 : OVERVIEW OF ISO 9001: INTRODUCTION BACKGROUND THE ISO 9001:2000 STANDARD AIMS AND BENEFITS OF ISO 9001: LIMITATIONS AND DISADVANTAGES OF ISO 9001: CONCLUSION...33 CHAPTER 4 : CASE STUDY - QUALITY MANAGEMENT IN ABC PROJECTS (A CONSULTING ENGINEERING COMPANY) INTRODUCTION WHAT IS A CONSULTING ENGINEERING COMPANY? OVERVIEW OF ABC PROJECTS RESULTS OF THE QUALITY MANAGEMENT SYSTEM - EMPLOYEE OPINION QUESTIONAIRE RESULTS OF THE QUALITY MANAGEMENT SYSTEM - MANAGEMENT OPINION QUESTIONAIRE ASSESSMENT OF THE ABC PROJECTS QUALITY MANAGEMENT SYSTEM IMPROVEMENTS THAT COULD BE MADE CONCLUSION...53 CHAPTER 5 : SUMMARY, CONCLUSION AND RECOMENDATION SUMMARY CONCLUSION RECOMMENDATIONS FOR FURTHER STUDY...57 MARK PITOUT NOVEMBER 2007 IV

5 BIBLIOGRAPHY APPENDIX A. QUALITY MANAGEMENT SYSTEM EMPLOYEE OPINION QUESTIONNAIRE AS COMPLETED BY THE EMPLOYEES OF ABC PROJECTS APPENDIX B. QUALITY MANAGEMENT SYSTEM MANAGEMENT OPINION QUESTIONNAIRE AS COMPLETED BY THE MANAGEMENT OF THE ABC GROUP APPENDIX C. TRANSCRIPT OF THE INTERVIEW BETWEEN MARK PITOUT (THE AUTHOR) AND RICHARD BAARD (CHIEF OPERATING OFFICER OF ABC PROJECTS), 19 NOVEMBER L I S T O F F I G U R E S Figure 2.1 Oakland s model for TQM [3]...9 Figure 3.1 Model of a process-based QMS [1]...17 Figure 3.2 The Plan-Do-Check-Act methodology [3]...18 Figure 3.3 Generic model of a QMS...20 Figure 3.4 The QMS interacting with other processes in the organization...21 Figure 3.5 The product design and development process...27 Figure 3.6 Cost of Poor Quality vs. QMS Cost [2]...31 Figure 4.1 Results of the QMS Employee Opinion Questionnaire...40 Figure 4.2 Results of the QMS Management Opinion Questionnaire...44 L I S T O F T A B L E S Table 4.1 Results of the QMS Employee Opinion Questionnaire...39 Table 4.2 Results of the QMS Management Opinion Questionnaire...43 MARK PITOUT NOVEMBER 2007 V

6 L I S T O F A B B R E V I A T I O N S QMS QM TQM ISO PDCA SAACE ECSA OP : Quality Management System : Quality Manual : Total Quality Management : International Organization for Standardization : Plan-Do-Check-Act methodology : South African Association of Consulting Engineers : Engineering Council of South Africa : Operational Procedure MARK PITOUT NOVEMBER 2007 VI

7 CHAPTER 1 : INTRODUCTION 1.1 PROLOGUE Most businesses of today find themselves in a market, where they compete against each other for customers. Competing organizations are evaluated based of their reputation for Quality, Reliability, Price and Delivery. Of these factors quality is named as the most important. [3] But what is quality? How does one measure quality? How does one achieve quality? Six Sigma provides the following definition for quality: Anticipate and honour the need of an intending user. [11] This definition implies that the quality of a company is dependant on the company s ability to identify its customer s need and then provide a product or service that effectively satisfies that need. The above definition of quality seems very simple; however it is the view of this author that the implications of applying this definition in certain organizations can be very complex. Since the early 1950 s there have been many Guru s that studied the concept of quality and developed various philosophies and tools regarding the topic. [11] As a result the notion of Quality Management was born, and many publications have been made on this topic. 1.2 PROBLEM STATEMENT In January 2003 the South African Association of Consulting Engineers (SAACE), declared that all of its members shall Implement and maintain a system of quality management in their practices. [7] The SAACE also names the ISO 9001:2000 standard as a comprehensive, internationally recognized common sense approach for managing and controlling a consulting company and recommends that consulting companies use it to achieve quality in their operations. [7] MARK PITOUT NOVEMBER

8 The ABC Group * (a member of the SAACE), adopted a quality assurance system based on the ISO 9001:2000 standard. This system is to be used by all the member companies of the group and is aimed at providing the companies with a Quality Management System (QMS) that is to govern all of its operations, especially in the operation of delivering engineering solutions to its clients. Despite a strict company policy requiring its entire staff to cooperate and comply with the system, ABC Projects (a member of the ABC Group) has not yet implemented the system successfully, nor has it attained ISO 9001:2000 accreditation. 1.3 RESEARCH OBJECTIVES In this dissertation the author provides an overview of quality management and in particular the ISO 9001:2000 standard by highlighting: The key aspects of the standard. The benefits / advantages of the standard. The limitations / disadvantages of the standard. The practical issues surrounding the implementation of the standard. Furthermore the author makes an analysis of the implementation of the standard by ABC Projects, and highlights the shortcomings and successes of their implementation. At the hand of relevant research, the author also makes recommendations on how the company could proceed to improve its quality assurance system and ultimately attain ISO 9001:2000 accreditation. * The ABC Group is a pseudonym for the sake of confidentiality. ABC Projects is pseudonym for the sake of confidentiality. MARK PITOUT NOVEMBER

9 1.4 RESEARCH METHODOLOGY Firstly the author provides a brief literature study of Quality Management as a whole, highlighting the history of Quality, Total Quality Management, and ISO 9001:2000, and their relation to each other. Secondly the author provides a literature study on the ISO 9001:2000 standard, highlighting the key aspects of the standard, the aims and benefits of the standard, the structure of the standard and the limitations and disadvantages of the standard. Thirdly the author provides a case study of the QMS in ABC Projects, evaluating it at the hand of the ISO 9001:2000 standard. In addition to this evaluation the author provides the results of two questionnaires that were circulated in the company. One questionnaire was circulated among the employees of ABC Projects, and the second among the management of the ABC Group. Lastly the author provides his conclusions made from the study, the lessons learnt from the study and also makes recommendations for further study. 1.5 CONCLUSION In today s competitive market quality has become a very important factor in the survival of any organization, and since the early 1950 s the subject of quality management has been widely studied and developed. ABC Projects, a member of SAACE, has adopted a Quality Management System based on the ISO 9001:2000 standard. However, ABC Projects has not yet implemented the QMS successfully, nor has it attained ISO9001:2000 accreditation This dissertation will provide and overview of quality management, and in particular the ISO 9001:2000 standard. A case study of ABC Projects and its implementation of the standard will also be presented. MARK PITOUT NOVEMBER

10 CHAPTER 2 : OVERVIEW OF QUALITY MANAGEMENT 2.1 INTRODUCTION In order to view the ISO 9001:2000 standard for quality management systems in context, one should investigate the broader subject of quality management. Section 2.2 provides a brief overview of quality management, by highlighting the history of quality management that led to the concept of Total Quality Management (TQM) as well as the development of the ISO 9000 set of quality standards. Section 2.3 provides an overview of a TQM model and highlights how ISO 9001:2000 standard forms part of that model. 2.2 HISTORY OF QUALITY MEDIEVAL EUROPE Before the industrial revolution of the early 19 th century, goods were produced by craftsmen that belonged to unions called guilds. Each guild had stringent rules that defined the quality of products produced by its members. A product that passed the quality inspection of the guild would be marked with a special symbol of that guild. In many cases each craftsman would also mark his product with his own symbol. [6, 12] These two symbols together with the reputation of the craftsman and the guild that he belonged to, would indicate the quality of the product to the customer. In this era the concept of quality was simple Produce products that satisfy your customers or suffer a bad reputation that will finally lead to the closure of your business. THE INDUSTRIAL REVOLUTION During the industrial revolution factories aimed at mass production and mass income came into existence. Many of the smaller craftsman businesses were replaced by these factories, and the craftsmen became employees in such factories. Initially quality was achieved through skilled labourers and inspections. [12] MARK PITOUT NOVEMBER

11 As time progressed the emphasis in factories became maximising productivity and minimizing workforce, which led to a decline in quality. As a counter to this decline in quality, factories created entire quality inspection departments that had the responsibility of detecting and eliminating defective products before being released from the factory. [12] In this era, the pride and reputation of the craftsmen gave way to mass production. Quality was no longer an inherent part of the process of production, but rather an afterthought. Rather than making sure that every product produced would satisfy the needs of the customer, factories would only try to ensure that defective products were not sold. EARLY 20 TH CENTURY In the mid 1920 s Walter Shewhart, a statistician for Bell Laboratories, developed statistical methods for controlling quality. Shewhart s approach was to evaluate the data produced by manufacturing processes by using statistical techniques. Such evaluation then indicated whether the manufacturing processes were operating correctly or not. [6, 12] Shewhart s methods of evaluating process related data by statistical techniques are referred to as Statistical Quality Control (SQC). Shewhart s SQC methods eventually led to the development of modern day methods like control charts. [12] The major difference between SQC and quality control techniques that were used before it is that SQC focuses not only on the final product, but on the process that produced it as well. [12] During World War II the United States Army developed, with the aid of Bell Laboratories, a standard for sample inspection of military equipment (MIL-STD-105). The U.S. Army also promoted the use of SQC to its suppliers, and sponsored SQC training courses. Despite this promotion of SQC most manufacturing companies only employed SQC programmes to comply with the U.S. Army requirements, and terminated these programmes when their contracts with the U.S. government expired. [6, 12] Shewhart also introduced the Plan-Do-Check-Act (PDCA) methodology. [11] The PDCA methodology forms the basis for the ISO 9001:2000 standard and is described in section 3.3 of this dissertation. MARK PITOUT NOVEMBER

12 TOTAL QUALITY MANAGEMENT In the early years after World War II, Japan had a reputation for producing inferior quality products, and most Japanese companies were unsuccessful in international markets. As a result Japanese companies changed their view on quality, by broadening the focus of their quality efforts to all their organizational processes. [12] This approach of focussing on quality throughout the entire organization is called Total Quality Management (TQM), and was developed by various Guru s in the field of Quality Management: W.E. Deming - Developed a fourteen point plan, centred around changing the culture in organizations to focus on quality. [13] His philosophy placed the majority of the responsibility on the management of organizations to improve their business processes on an ongoing basis. Deming also promoted the use of the Plan-Do-Check-Act methodology, developed by Shewhart. [11] Dr. J.M. Juran - Developed the quality trilogy which consists of three main items. [11, 14] Quality Control: Maintaining an established level of quality Quality Planning: Planning projects that are aimed at improving the quality of processes within an organization Quality Improvement: Executing planned projects in order to establish a new level of quality Juran also considered each person involved in the processes of the organization as both an internal supplier and an internal customer of the product, as it passed through the various stages of manufacture. Dr. K. Ishikawa - Developed the seven basic tools of quality, a set of analytical diagrams and charts that are aimed identifying the cause of quality problems in the organization. The most notable of these charts is the Cause and Effect diagram (or Fishbone diagram). Ishikawa also advocated an organization-wide approach to quality. [11] MARK PITOUT NOVEMBER

13 Dr. G. Taguchi - Promoted quality focused design that is aimed at developing products that are impervious to variations in the production process. Taguchi believed that quality problems needed to be solved at the design / development stage, rather than the production or final inspection stages. Taguchi also developed the Taguchi Methodology a prototyping method aimed at optimising products during development. [11] P. Crosby - As quality director of ITT, introduced two philosophies of quality namely Quality is free and Zero Defects. Based on these philosophies he had four absolutes. [3, 11, 15, 16] The definition of quality is conformance to requirements The system for achieving quality is prevention The standard for quality is zero defects The measurement of poor quality is the price of non-conformance Crosby also offered his organization a 14-step program to improve quality. This program revolved around concepts like management commitment and involvement, communicating quality objectives throughout the company and continuous assessment and improvement. [3, 11, 15, 16] Ironically, in the second chapter of Crosby s book Quality is Free, he makes the statement that: Unfortunately, the business of quality management is not all that easy. [15] Therefore quality management requires considerable effort. Effort implies time spent, which in turn implies cost. Therefore quality is not entirely free. However by achieving quality in one s product, money can be saved in areas like maintenance and service costs, and money can be made in other areas like repeat business from satisfied customers. Therefore the effort, time and money spent on quality management, has a payback which covers the expenditure and gives rise to the concept of Quality Is Free. MARK PITOUT NOVEMBER

14 From the work of the Guru s mentioned above one can see a common theme that developed for the theory of TQM: Quality is a function that has to be driven by an organization s management Quality is an organization-wide function Quality improvement is a never-ending cycle of assessment, planning, implementation and re-assessment THE ISO 9000 SET OF QUALITY STANDARDS As a result of the increasing focus on quality in organizations around the world, the International Organization for Standardization developed, in 1987, a set of standards known as ISO 9000:1987. This set of standards has been reviewed and developed further to produce sector specific standards, such as QS-9000 for the automotive industry, AS9000 for the aerospace industry, and ISO for environmental management. [12] The process of refining the ISO 9000 set of quality standards to its current form (ISO9000:2000) also led to ISO 9001:2000, an internationally recognized standard for Quality Management Systems (QMS s). An overview of ISO 9001:2000 is provided in Chapter 3 of this dissertation. 2.3 TOTAL QUALITY MANAGEMENT A MODEL John S. Oakland presents in his book (TQM, Text with Cases - 3 rd Edition) [3], a model for TQM. This model is based on what he calls The four P s and three C s of TQM and is provided in Figure 2.1. In this model the four P s represent the hard management factors that have to be considered when TQM is practiced in an organization. The three C s represent the soft management factors that need to be integrated into the four P s, in order for TQM to be effective. [3] MARK PITOUT NOVEMBER

15 Planning Communication Culture Performance People Commitment Process Figure 2.1 Oakland s model for TQM [3] It is the author s opinion that Oakland s model for TQM, elegantly ties the key aspects of TQM together. Figure 2.1 provides only a high-level view of this model; so in order to understand the model better, one must study the four P s and Three C s of the model. Oakland provides a detailed description of this model in his book (TQM, Text with Cases - 3 rd Edition). Here follows a brief overview of the model: PLANNING Planning for the implementation of TQM should include a review of the entire organization. This review focuses on the organization s mission and vision, processes, subprocesses and structure. The mission and vision of the organization determines the goals of the organization, while the processes and structure determines how the organization achieves those goals. Consideration must be given to how each of these facets of the organization impacts on quality. [3] MARK PITOUT NOVEMBER

16 The resources that the organization uses in its processes (including those resources sources from other organizations / suppliers) also need to be considered. An organization should establish policies or rules that govern the sourcing and management of resources or materials from suppliers, with the focus again being on the impact on quality. The organization can choose to form partnerships with suppliers that adhere to these policies. [3] Products, services, processes, and organization structures are realized from designs. As per the philosophy introduced by Dr. G. Taguchi, quality is introduced during the design phase of these factors, rather than during the realization phase. Quality can be introduced into designs by various methods, such as Quality Function Deployment (QFD) and Failure Mode, Effect and Criticality Analysis (FMECA). [3, 11] PERFORMANCE As part of an organizations continuous improvement (the PDCA cycle) the performance of the organization and its processes must be measured. For this measurement an appropriate framework needs to be established to make measurements at four levels: Strategic level; Process level; Individual Performance level; and Review level. [3] Measurement frameworks have associated costs in their development and implementation. These costs need to be balanced with the value that they add to the organization. [3] Various models like the Deming Prize, the Baldrige Award, and the European Foundation for Quality Management Excellence Model are available for organizations to perform self-assessment. These models can be used in a number of approaches, including workshops, audits, surveys, etc. [3] Benchmarking is another technique that can be used to measure an organization s performance. During benchmarking an organization compares its operations, products, and services to those of a competitor, to industry standards, or internal standards. The purpose of benchmarking is to establish the perspective of how well an organization is doing compared to its competitors, to challenge current practises and standards, and to set goals for improvement. [3] MARK PITOUT NOVEMBER

17 PROCESSES All activities in an organization can be viewed as processes. Managing the core processes of the organization provides the key to improve performance. To help the managers understand their organization s processes better, flowcharts can be used to graphically document the processes. In some cases it may be necessary to completely redesign certain processes as the organization changes with time. [3] In order to manage the quality of an organization, its processes and its products or services, an appropriate Quality Management System (QMS) must be established. The ISO 9000:2000 set of standards (including the ISO 9001:2000 standard) provides an international standard for such QMS s. The QMS should follow the PDCA methodology. [3] The ultimate goal of the QMS is continuous improvement of the organization s processes. This improvement can be implemented by various methods such as Pareto analysis, cause and effect analysis, matrix diagrams, Taguchi methods, etc. [3] PEOPLE The most valuable resource in an organization is its people. Organizations that place emphasis on quality also align their Human Resource Management (HRM) policies with the strategic goals of the organization. Employees should be empowered by and involved in their organization. Employees should also be trained to have the skills they require for their work. [3] Process management and improvement is generally achieved by teams of people. The success of such teams depends on factors like composition and dynamics, leadership, clear objectives, and reviews. Teams go through four phases before they become truly effective. These phases are: Forming; Storming; Norming and Performing. [3] In order to sway the employees of an organization to accept the TQM approach, effective communication with those employees must be achieved. The quality strategy and goals must be clearly communicated from top management to all employees. Employees must be educated to understand their role in the TQM process, as well as the benefits that the TQM process offers. [3] MARK PITOUT NOVEMBER

18 The combination of empowered and trained employees, well structured teams that also perform well, and adequate communication of the organization s quality strategy, will create the right sort of culture for quality and also make the employees committed to the TQM efforts of the organization. [3] 2.4 CONCLUSION The history of Quality Management dates back to the industrial revolution, where the method of production shifted away from individual craftsmen to factories. Quality management developed from the initial method of inspecting the final product for conformance to requirements, to making quality the focus of all aspects of organizations. [6, 12] Various methods and models were developed to achieve quality in all aspects of organizations, and the concept became known as Total Quality Management. As a result of this focus on quality management the ISO 9000:2000 family of international standards were developed. [11, 12] Oakland s [3] model for TQM provides a framework for understanding, developing and implementing TQM in an organization. In this model there are four P s (Planning, Performance, Processes and People), that represent the hard management issues that need to be considered, while the three C s (Communication, Culture and Commitment) represent the soft management issues. As part of the Processes leg of the Oakland Model [3], an effective Quality Management System (QMS) needs to be established in the organization, in order to manage and improve the quality of the organizations processes and its products. The ISO 9000:2000 family of standards provides a framework for such QMS s that may be implemented by organizations across the world. An overview of the ISO 9001:2000 standard is provided in the next chapter. MARK PITOUT NOVEMBER

19 CHAPTER 3 : OVERVIEW OF ISO 9001: INTRODUCTION As ISO 9001:2000 is quoted by the South African Association of Consulting Engineers (SAACE) as the recommended quality management standard to be used by a consulting engineering company [7], it will be the focus of this study. ISO 9001:2000 is also internationally recognised as the standard for quality management due to the fact that it was produced by the International Organization for Standardization (ISO). In this chapter the author will provide background of the standard including the history of the standard, and how the standard evolved from its previous versions to the current ISO 9001:2000. The author also takes an in-depth look at key aspects of the ISO 9001:2000 standard, which include: The quality management system. Management responsibility. Resource management. Product Realization. Measurement, Analysis and Improvement. Lastly the aims and benefits of the ISO9001:2000 standard are discussed, as well as the limitations and disadvantages. MARK PITOUT NOVEMBER

20 3.2 BACKGROUND WHAT IS ISO? The acronym ISO stands for International Organization for Standardization. It is an international federation of national standards bodies, that develops standards by using technical committees composed of representatives of each member body. [1] One of ISO s aims is to develop standards that are internationally applicable, and provides a common set of rules for organisations to be governed and measured by. [2] The ISO 9001:2000 standard, for example, is applicable to quality management, and provides that set of rules that organisations can use to create, operate and maintain their QMS. The set of rules are also used to measure how well a specific organization s QMS performs, and the organization attains ISO 9001:2000 accreditation based on that measurement. In certain industries it may be critical for an organization to attain this accreditation, as their customers may insist on only dealing with organizations that are ISO 9001:2000 accredited. HISTORY OF THE ISO 9001:2000 STANDARD Ray Tricker [2] offers a very concise overview of the history of the standard in his book ISO 9001:2000 for Small Businesses (3 rd edition). Highlights of this history are given here: The first version of the standard was released in 1987 as the ISO 9000:1987 set of standards, and it was based to a large extent on the British Standard BS 5750, parts 1 to 3. After its release various other standards bodies, adopted the text without changes and republished it under their own naming convention (such as EN 29000:1987 as the European version of the standard and BS 5750:1987 as the British version). [2] As the standard grew in popularity, it also became more apparent that there were certain elements missing. In 1994 the standard was revised and published as ISO 9000:1994 which consisted of 20 elements that had to be addressed in a QMS. However there were still some problems with the standard. For instance, complying with the standard did not implicitly mean that an organization would deliver services or produce products that were MARK PITOUT NOVEMBER

21 of a high quality. It only ensured that the services and products were of a consistent quality. In other words, if an organization that continually produced a poor quality product, could still comply with the standard. [2] As ISO 9000:1994 grew more popular it became apparent that the standard provided a good base to start from, for organizations that wanted to implement QMS s, but additional effort and further development of their QMS s was required for it to be of benefit. Furthermore there were parts of the standard that an organization could ignore, and still maintain the quality of their product. Therefore further revision of the standard was required. [2] The ISO maintains a policy whereby all international standards are reviewed five years after publication, to determine if the standards are still applicable. To this end the ISO assigned its technical committee No. 176 (also known as ISO/TC176), to conduct a survey of the ISO 9000:1994 standard with the aim of discovering the problems with the standard and the requirements for the revised standard. The committee was also to investigate how the standard could be revised to complement environmental management and health and safety standards. [2] The survey indicated several improvements that needed to be made during the revision of the standard. The most notable of these improvements were that the standard had to be [2]: More flexible to accommodate organizations of all types and sizes Clearer and easier to understand Based on a process model More compatible with other management system standards Aimed at continual improvement and increasing customer satisfaction ISO 9000:1994 was also a set of standards consisting of four parts ISO 9001:1994, ISO 9002:1994, ISO 9003:1994, ISO 9004:1994, which created some confusion as to which one was applicable for certification. To this end two overall standards were created: ISO 9001:2000, which combined the first three of the aforementioned standards and addressed the requirements of a QMS, and ISO 9004:2000 which was a revision of the last MARK PITOUT NOVEMBER

22 standard of the set, and addressed the gradual improvement of an organisations overall quality performance. [2] Based on the requirements that were identified in the survey conducted by ISO/TC176, the standard underwent an extensive revision process whereby several drafts of the standard were produced. Working drafts were produced during the course of 1997 and 1998, for review by the technical committee itself. Committee drafts were produced during 1998 an 1999 for member bodies to vote and comment on. A final draft was produced in September 2000, and finally in December 2000 the standard was published. [2] WHAT DOES THE ISO 9001:2000 STANDARD LOOK LIKE TODAY? Instead of 20 elements, the revised standard, ISO 9001:2000, now contains five main clauses [1] pertaining to: The quality management system Which sets the general requirements for the system as well as its associated documentation. Management responsibility Which details the requirements of an organizations management to effectively implement and maintain the system. Resource management Which details the requirements of an organizations resources to effectively implement and maintain the system. Product realization Which details the processes that are to be followed to produce/deliver a quality product/service. Measurement, analysis and improvement Which details the requirements for assessing and improving not only products and services, but also the processes within the organization and the QMS itself. It is important to note that according to the definition given in the standard, a product is seen as a process, which uses resources to transform inputs into outputs and can fall into one of four categories hardware; software; services; and process materials. [2] Therefore the clause referring to product realization is not limited to the manufacturing industry. MARK PITOUT NOVEMBER

23 3.3 THE ISO 9001:2000 STANDARD The scope of the standard can be defined as the specification for a QMS that provides assurance of an organization s ability to [1]: consistently provide a service or product that meets customer and regulatory requirements, enhance customer satisfaction and provides continual improvement of an organisations processes. The introduction of the ISO 9001:2000 standard requires that all operations of an organization (including the QMS) be process-based in order for the QMS to interact with the other operations of the organization. A process-based QMS can be represented as in Figure 3.1: Continual Improvement of QMS Customers Management Responsibility Customers Resource Management Measurement, Analysis, and Improvement Satisfaction Requirements Input Product Realization Products Output Figure 3.1 Model of a process-based QMS [1] In the model of a process based QMS, the organization is represented as a cyclic system that consists of Management Responsibility, Resource Management, Product Realization, and Measurement, Analysis and Improvement. The cycle represents Clauses 4 to 8 of the standard. MARK PITOUT NOVEMBER

24 This system interacts with the customer on various levels: Management communicates with the customer; the customer provides inputs to the product realization process; the product is delivered to the customer; and the customer s satisfaction is measured by information relating to the customer s perception. The cyclic process of the QMS is not only focussed on improving the product and thereby enhancing customer satisfaction, but also is also focussed on improvement of the QMS itself. Also noted in the introduction of the standard is that the Plan-Do-Check-Act (PDCA) methodology can be applied to all processes. [1] The PDCA methodology dictates that one must: plan the objectives of a process that is to be implemented; implement the process; verify that the process is achieving the planned objectives; and take action to improve the process. [3] Figure 3.2 represents the Plan-Do-Check-Act methodology as a continuous cycle: PLAN Plan the actions aimed at achieving the desired results DO Implement the plan CHECK Record and review the results ACT Revise the plan to improve the results Figure 3.2 The Plan-Do-Check-Act methodology [3] The ISO 9001:2000 standard consists of eight clauses and two annexes. However, as mentioned in section 3.2 there are five main clauses in the standard, as the firsts three clauses merely describe the scope of the standard, normative references, and terms and definitions. MARK PITOUT NOVEMBER

25 The two annexes in the standard highlight the correspondence between ISO 9001:2000 and ISO 9001:1994 as well as ISO 14001:1996. Here follows the author s interpretation of the five main clauses of the ISO 9001:2000 standard (Clauses 4 to 8). In this study the standard as published by the ISO [1] and the book ISO 9001:2000 for Small Businesses (3 rd edition) by Ray Tricker [2] are used as the main references. CLAUSE 4 - QUALITY MANGEMENT SYSTEM Clause 4.1 The general requirements of a QMS follow almost logically from taking a process view on the QMS. The requirements are plainly that: The processes required for the QMS, their sequence and their interaction be identified. The criteria and methods for the operation and control of the processes be identified. The resources and information required for the processes be available. The processes are monitored for effectiveness, and action be taken to continually improve them. Clause In addition to the system described in clause 4.1 there are also certain documentation requirements for the QMS. The documents that must be prepared for the QMS include: Statements of the quality policy and quality objectives. Quality manual. Quality procedures. Planning, Operation and Control documents of the organization s processes. Quality records. The manual must include the scope of the QMS, the quality procedures (or reference to them), and the description of the interaction between the QMS processes. The standard further specifies that a documented procedure must be established for the control of the QMS documents. The procedure must basically ensure that approved versions of the documents are available at the intended point of use; the documents are MARK PITOUT NOVEMBER

26 revised and re-approved when required; superseded versions of the documents are removed from circulation. The last requirement of the QMS specified by the standard is that records must be kept of product or service conformity to the given requirements, as well as the effective operation of the QMS. A documented procedure must be established that describes how these records are identified, stored, protected, and retrieved, as well as how long the records are stored, and how they are disposed of. As the standard is written to be generic and applicable to any organization, the standard does not specify what the above documents should look like. Instead it merely states that the extent of the documents depends of the size of the organization, the complexity of its processes and the competence of its personnel. Although this generic nature of the standard makes it applicable to any organization, it does present some difficulties in the sense that very few hard and fast specifics are given regarding the requirements of the QMS. Organizations are required to determine for themselves what the extent of their QMS and its associated documents will be. Therefore the success of the QMS will be determined by the skill of the people developing and implementing the QMS in the organization, rather than the QMS s conformance to the standard. As the QMS is meant to be approached as a process, a generic process flow diagram for the QMS could be represented as in Figure 3.3. Resources Information Network of QMS Processes + Quality Documents Quality Records Quality Improvement Monitoring and Improvement Figure 3.3 Generic model of a QMS MARK PITOUT NOVEMBER

27 The monitoring and improvement of the QMS is represented as a feedback loop to the QMS. However, the QMS itself represents a feedback loop to the other processes of the organization. Therefore a process flow diagram of the QMS and its interaction with these other processes could be represented as Figure 3.4. Inputs Quality Improvement Quality Records Other Processes in the Organization Network of QMS Processes + Quality Documents Outputs Information Monitoring and Improvement Figure 3.4 The QMS interacting with other processes in the organization This interaction of the QMS with the other processes of the organization represents what is known as a dual feedback loop. In other words the QMS monitors and improves not only the other processes of the organization but itself as well. The criteria for the QMS given in Clause 4 of the standard (as summarized above) are stated very generically and without many specifics; the following clauses (5 to 8) provided further requirements that must also be met by the system. These requirements will be highlighted in the sections that follow. CLAUSE 5 - MANAGEMENT RESPONSIBILITY In this clause the standard lays a lot of responsibility on the top management of an organization, to ensure that the QMS is implemented, maintained and improved. As with all other systems, management has to be the driving force behind the QMS, in order for it to be accepted in the organization. Functions that are to be fulfilled or driven by top management are summarised below: MARK PITOUT NOVEMBER

28 Clause The top management of an organization must have a commitment to the QMS. At first glance one might think that this is a very peculiar topic to be addressed in a standard for a system. Commitment is a human attribute that may vary, depending on a multitude of intangible factors, like for instance the personality of the person that fulfils the management roll. Then how does the standard determine an intangible factor like commitment? The standard does this by specifying the measurement of the effect of the management s commitment: Clause 5.1 states merely that the top management of an organization shall provide evidence of its commitment to the development, implementation and improvement of the QMS by: Communicating the importance of meeting customer, statutory, and regulatory requirements (i.e. the goal of the QMS). Establishing the quality policy. Ensuring that quality objectives are established. Conducting management reviews. Ensuring the availability of resources. This implies that top management should perform the above functions (or at least appoint people to perform them) and the products of these functions should be captured on relevant records, to serve as evidence. The QMS must therefore make allowance for these records and contain them. Clause The top management of an organization shall ensure that the customer s requirements are determined and met, in order to enhance the customer s satisfaction. This focus on the customer s requirements is needed, because unlike the statutory and regulatory requirements that are naturally stated in specific terms by documents produced by the bodies that enforce them; the customer s requirements would not always be stated in specific terms. Therefore the organizations must record and agree the customer s requirements in specific terms, so as to ensure that they are met, and the customer is satisfied. Again the QMS is to allow for and contain records of these requirements. MARK PITOUT NOVEMBER

29 Clause The Quality Policy of a company is indicated in Clause 4 of the standard to be an integral part of the QMS documentation. Clause 5.1 states that the establishment of this policy is the responsibility of the top management of the organization. The most notable requirements of the quality policy is that: it must include the organizations commitment to quality; provide the framework by which quality objectives are established and reviewed; and the policy must be communicated and understood throughout the organization. Clause The quality objectives for each function and level of the organization must be established by top management. These objectives are established when the top management plans the QMS. Such planning should also ensure that the QMS fulfils the requirements set in Clause 4.1 and that the QMS retains its integrity when changes are made to improve the QMS. Clause The organization must identify responsibilities and authorities, and communicate them throughout the organisation. One such authority must be a representative from top management who, aside from his other responsibilities, drives the QMS by ensuring its operation, reporting on its performance, and promoting the QMS throughout the organization. This clause therefore indicates the necessity for a person that champions the QMS. Clause 5.6 States the requirement for the management of an organization to review its QMS. These reviews should be held at planned intervals and should cover information gathered about audits held, customer feedback, performance, etc. Of course all such information that is to be reviewed should be captured on applicable records that form part of the QMS. During the QMS review, management should make decisions on how the QMS can be improved, how their product / service can be improved, and what resources are required for the QMS and the identified improvements. The reviews themselves must also be recorded and the records must be contained in the QMS. MARK PITOUT NOVEMBER

30 CLAUSE 6 - RESOURCE MANAGEMENT Clause As with most systems in an organization, the QMS will require certain resources to operate properly. As every QMS would be unique to the particular organization that it operates in, so to would the resources required to operate the QMS. Clause 6.1 of the ISO 9001:2000 standard therefore does not specify what resources would be required, but does state that the organization shall identify AND provide the resources required for the effective operation of the QMS. Clause People (human resources) involved in the QMS must have the competence required to perform their assigned tasks. To accomplish this, the people involved in the QMS have to be trained to have the competencies that are identified for their specific tasks and records of such training have to be kept. Again these records are to be provided and contained in the QMS itself. The people involved in the QMS must also be informed of how their tasks influence the achievement of quality objectives so that they understand the relevance of the tasks that they perform. Having this understanding would in all probability increase their commitment to the QMS. Clauses 6.3 and Having the human resources to operate the QMS is not enough though. The organization must also identify and provide the relevant infrastructure and working environment for the QMS and its associated human resources. In other words, the people that operate the QMS must not only be trained, but they have to be given the required tools and workspace as well. It is the author s opinion that the one resource that is frequently overlooked in the implementation of a QMS is time. Frequently the tasks required for the operation of the QMS are assigned to people that already have other tasks to perform in the other systems of the organization, and these people then struggle to find the time required to perform their QMS tasks. MARK PITOUT NOVEMBER

31 CLAUSE 7 - PRODUCT REALIZATION Clause 7 of the ISO 9001:2000 standard describes the requirements for the systems that realize the product of an organization. One might say that specifying requirements for the product realization processes is beyond the scope of a standard for quality management systems, and that the authors of the standard should focus on their own domain. However, it is the interface between the QMS and the product realization process that prompts the authors to define the requirements of these processes. In other words, how the product realization processes are structured, will determine how well the QMS system can interface with these systems and therefore measure the quality of the product. As mentioned above in section 3.2, where the standard uses the word product, it is not referring only to hardware or software but services as well. Therefore the services delivered by a specific organization (for instance a consulting engineering company), could be considered as its product. Clause The first step to realizing a product is to plan how it will be realized. From the QMS s point of view this means that an organization needs to establish the following: The process required to realize the product, as well as associated documents and resources. The quality objectives of the product and the process that produces it. The way in which the product will be verified, validated, tested, etc. to ensure that the product fulfils the requirements. The records that will serve as proof of the abovementioned verification, validation, testing, etc. It is noted at the end of clause 7.1 that the documentation of the above can be referred to as the quality plan. As a result of clause 7.1 it would be safe to assume that such a quality plan would exist for every product produced by an organization. Clause Before a product is realized, the requirements of the product must be defined in specific terms. In this clause the standard describes what it calls a customer related process whereby the requirements are determined (documented), reviewed, and communicated to the client. MARK PITOUT NOVEMBER

32 The documented requirements include those of the client, the relevant statutory and regulatory bodies, the organization itself, and those necessary for the intended use of the product. An organization must review these requirements before it commits to producing the product, in order to ensure that the requirements are defined in specific terms and that the organization is capable of meeting the requirements. Communicating the documented requirements not only ensures that the customer is in agreement with the requirements, but also provides the forum for the customer to give feedback to the organization. Clause A product must be designed and developed according to a certain process. The process described in this clause is one of: Planning the development stages; the review, verification and validation of each stage; and resources required for each stage. Using the requirements documented as per clause 7.2 as inputs to the development process. Documenting development outputs, such as purchasing, production and service provision information; product acceptance criteria; etc. Reviewing the development process at certain predetermined stages. Verification of the design. Validation of the design. Controlling changes that result from review, verification, validation, or the discovery of further requirements. Each step of the process described in Clause 7.3 is to be documented and captured in appropriate records that are provided by and contained in the QMS. A generic process flow diagram for this process could be represented as shown in figure 3.5: MARK PITOUT NOVEMBER