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An ISO 9001 certified
quality management system can provide a whole range of benefits:
- You have consistent,
repeatable processes and a common, understood system
- Your people are clear about what to do, and how it is to be done.
They don't spend time 'making things up' or 'finding things out' or
reinventing wheels, or duplicating effort.
- Better management control and reporting - you
know how your business is doing.
- Your business functions in a disciplined way: almost no
matter what happens, you have a systematic way of handling it
- You have fewer problems with failures in service or product
quality; as you mature in quality management, you spend more and more
time on improving rather than fixing and reacting
- You have more or better business, because you can sell to new markets
or having the endorsement distinguishes you in the marketplace
- You know more quickly if things are going wrong, and where
- You stop spending money or wasting time on the same old
problems - many problems have been resolved permanently. If
another crops up, you have inner resources and skills to identify &
resolve it faster.
- You don't scratch your head wondering how to respond to tenders
or other questions asking about your quality system, because you
know! And that 'ISO 9001' phrase works wonders.
I love hearing from clients about the benefits they got
through doing ISO 9001. Most often they say things like they feel much
more in control, the business runs better, everyone is clearer about
what they do, processes are improved,
they know better how to
manage more effectively, there have been increases in customer and employee satisfaction
and positive feedback, and reductions in
duplication, recurring problems, rework, frustration or sheer effort.
A definitive joint statement from ISO (who create the Standards) and
IAF (who oversee accreditation) on the
Expected Outcomes from ISO 9001.
Australian Business Experience with 9001
1. A 2007 study looked at why businesses implemented ISO 9001, their
approaches and experiences, and particularly comparing the 2000 version
with the earlier 1994 version it replaced
to see if it really better (yes!).
Major findings:
- The top 3 reasons for getting certification were externally
oriented:
enhancing the company image, responding to customer demand, and getting 'preferred supplier' status.
Top internal reasons were to establish better control over business operations, and to provide a foundation for continuous improvement.
- The major benefits reported were in: relations with customers, management of business processes, management of business knowledge and information, and in organisation strategy & culture, such as improving their managerial policies & procedures.
(Comment: A frequent post-9001 theme from clients
is: 'now we really know what we have and where it is, and everyone knows where to find it'.)
- The area reported as least impacted was supplier management.
- Businesses found the 2000 version of the Standard significantly easier
to implement than the previous (1994) version.
- Overall, results confirmed that the Standard had been much improved in terms of its ease of implementation & simplicity, while maintaining high levels of impact in business areas.
Some other findings:
- The mean time to implement the Standard reduced. For ISO 9001:2000, the mean was 8 months compared with a mean of 10 months for the 1994 version.
- Of the difficulties associated with implementing ISO 9001, balancing other priorities with the demands of implementation was the greatest one.
- The 2000 version was associated with substantially fewer difficulties in implementation across all elements surveyed.
Reference: The Implementation of ISO 9000 in Australian Organisations, Australian Supply Chain Management Research Unit, Monash University, supported by JAS-ANZ. Dr D Prajogo & Professor Sohal.
It was conducted by Monash University in collaboration with
JAS-ANZ. Findings
from 326 organisations, evenly spread between manufacturing and service; majority (87%)
= small to medium- sized organisations. Available from JAS-ANZ.
2. An earlier study (2003) found a significant and positive
relationship between management's motives for adopting ISO 9000
certification and business performance. Organisations that pursued
certification willingly and positively across a broad spread of
objectives are more likely to report improved organisational
performance. The individual element found to contribute most to
business performance was Customer Focus.
Ref: The Longitudinal
Effects of the ISO 9000 Certification Process On Business Performance,
2003 Terziovski, Power and Sohal, Melbourne & Monash Universities.
Findings only from manufacturing.
Positive effects of Certification - US Study
A survey in 2006 got the
following answers asking about whether they had gained internal
benefits. Of 2500 surveyed, there were:
- Improved customer satisfaction - 1,391 Yes
Responses
- Competitive advantage - 922 Yes Responses
- Reduced scrap/rework costs - 728 Yes Responses
- Increased
efficiency - 936 Yes Responses
- Greater quality awareness -
1,861 Yes Responses
- Positive cultural change - 845 Yes
Responses
- Enhanced communications - 880 Yes Responses
- Better documentation - 1,869 Yes Responses
A whopping majority (96%) said gaining certification had been a positive experience.
Survey conducted
by The Independent Association of Accredited Registrars (IAAR) -
an association of accredited management system registrars operating in
North America.
What Do Customers Know or Care? A UK Study
This survey wanted to find out if
consumers know (or care) about ISO 9000. It was done in the
UK, which has perhaps the most mature usage of the ISO 9000 series
worldwide. Findings:
- More than 1/4 (26%) of the general adult population was already
aware of the standards. Knowledge was concentrated among working
people.
- Results suggest positive attitudes towards ISO 9000 and companies
certified to the standard. They tend to perceive products and
services associated with ISO 9000 as being of higher quality.
- Consumers are more likely to contact a company if it uses 'ISO
9000' in the labelling and marking of products/services
- Consumers possess greater levels of trust and confidence in ISO
9000 products and services
- The labeling of products or services with a logo denoting ISO
9000 is likely to cause consumers to prefer them.
- One interesting finding was that it would be 'beneficial for companies having
certification to promote increased public awareness of ISO 9000,
because increased levels of consumer awareness should improve levels
of confidence and trust in their products and services'.
In other words: if you have it, use it. Tell your customers and
prospects you have it and wherever possible educate them in what
that means: particularly the benefits for them.
*Reference: Do consumers really care
about ISO 9001 certification?,
J Tannock & Henry Brown, Nottingham University Business School,
published in ISO Management Systems, May-June 2006 edition, Vol 6 #3.
Done by a
professional market research organisation.
Other Studies
- The Phoenix Police reported $11m in savings. Source:
ISO
video (unfortunately, no longer available to public).
- A detailed analysis of financial performance of ISO 9000-certified
organizations over a 10-year period, found that companies who implemented a system certified to ISO 9000 gained a
greater return on assets (ROA).
The study was conducted by a distinguished group of business school
academics from The Anderson School at UCLA, R.H. Smith School of
Business, University of Maryland and Universidad Carlos III, Spain.
They found that "Firms that failed to seek certification experienced
substantial deteriorations in ROA, productivity and sales, while firms
that did seek certification generally managed to avoid such declines".
Source: July-August 2002 issue of ISO Management Systems
- In a BSI survey In the survey of 227 US firms, one firm
reported a
sales increase after certification of $6 m. Another
company reported a 75% improvement in customer satisfaction.
(What would a 75% increase in customer satisfaction do for your
business?)
Other findings from the survey:
* the transition
and implementation costs were at least covered by savings
(80% reported this)
*better use of data by management
after certification (56% reported)
*improved customer satisfaction
(54%)
* management reviews were more effective (51%), and
*
improved customer communication (41%).
Many said that
they had improved their processes
and streamlined their systems as a result of identifying and analysing
their processes (as required by the Standard).
Certification to ISO 9000 was
seen as a powerful means for
recognising best practice and adopting it elsewhere, and for
identifying the issues that contribute most to customer satisfaction.
Other benefits cited included: a greater understanding of how their organisations worked (leading to shorter training times), clearer
communication and accountabilities, and significant reductions in
product development time and customer complaints.
Source: BSI, a global quality certifier.
- In a 1992 survey of companies who had held certification for several years:
*
Improved management control was reported by 86% of the managers
*
improved efficiency by 79% of managers
* reduced
waste (75% )
*
improved market share (71%)
* reduced costs (61%).
Source: LRQA, a global certifier
For nearly 20 years now I've worked closely with the 9000 family of
documents in the Standard. The more
I work with the Standard, the more I see how things improve IF it's used intelligently and the more respect I
have
for it. Yes, it has its critics and no, nothing's perfect.
But my experience of bad ISO 9001 systems is that they are
almost invariably caused by failures in understanding of the Standard
and/or failures of implementation, not the Standard itself.
The standing question for its critics: What do you propose instead?
Are the benefits automatic?
No. While the benefits of ISO 9001 are very real they
are not automatic. As one study says (bold
added): " the motive for adopting
ISO 9000 certification and the maturity of the
quality culture are significant predictors of the
benefits derived from ISO 9000 certification... organizations that have
been audited to the ISO 9000 standards believe that the quality audit
process contributes to business performance when the quality culture in
the organization is well developed and the manager’s motivation to gain
certification has been to improve business performance and not to
conform to an international standard. The individual element found to
contribute most to business performance was Customer Focus".
LONGITUDINAL EFFECTS OF THE ISO 9000 CERTIFICATION
PROCESS ON BUSINESS PERFORMANCE, Terziovski, Power and Sohal, Monash
University.
In other words, why and how you
do ISO 9001 will decide whether you gain the benefits available.
Or
not.
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