Quality Management System

Chapter - 5

ISO 9000:2000
Quality Management System

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 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. This helped to move
emphasis from detection to prevention.
Quality Assurance – Approach recognizes the inherent inefficiency of
waiting for the mistakes to happen. Analysis of Nonconformance and
happen Cause in a systematic manner is a key. Design Quality into the
process and practices so that things will not go wrong

Quality Control – A process that is used to ensure certain level of

quality in a product/service. It might include whatever actions a
business believes necessary to provide for the control and
verification of certain characteristics of a product or service.

Quality Inspection – Simple Approach that relies on

identifying defects in the Product or service before they
reach the customer by introducing “Inspection Stage or
stages. Against the specification
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 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, reliability, efficiency and interchangeability - and
at an economical cost.

• And the organization responsible for many thousands of

the standards which benefit the world is ISO.

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 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” encompassing experts from the
industrial, technical and business sectors which
have asked for the standards, and usage.

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 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.

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6
ISO: International Organization for Standardization

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.
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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).

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 ISO 9000 and ISO 14000 in briefe

• 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.

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 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

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 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. 11
 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.
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 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

customer's quality requirements and

– Comply with any regulations applicable to those

products or services.
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 Quality management

• Quality management also means what the

organization does to
– Enhance customer satisfaction and exceed
their expectations, and
– Achieve continual improvement of its
performance.

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 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

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16
 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.

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 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.

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 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.
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Schematic Representation of Process

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ISO: International Organization for Standardization
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.
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The ISO Survey

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 ISO CERT
1200000
1105937
1076525
1063751 1055028
1036321
1022877 1034180
1017279
1009845
1000000 980322
951486
896905

800000 773843

660132
COMPANIES

600000 561766
510349 497919

407674
400000
343641

271846
223298
200000 162700
127348
70364
46571

0
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
Year 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
TOTAL 46571 70364 1E+05 2E+05 2E+05 3E+05 3E+05 4E+05 5E+05 6E+05 5E+05 7E+05 8E+05 9E+05 1E+06 1E+06 1E+06 1E+06 1E+06 1E+06 1E+06 1E+06 1E+06 1E+06 1E+06

23
ISO: International Organization for Standardization

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 24
ISO: International Organization for Standardization

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.

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ISO: International Organization for Standardization

 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
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ISO: International Organization for Standardization
 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

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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

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Conceptual model of ISO 9000: 2000 Quality
Management Systems

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 System Requirements
Quality Management Resource Product Measurement
Management Responsibility Management Realization Analysis &
System improvement

Management
Commitment Provision of Planning
General General
resources
requirements
Customer focus Customer
Human related Monitoring &
resources processes measurement
Quality policy
Documentation
Requirements Design &
Infrastructur development Control
Planning
es

Responsibility, Work Purchasing Analysis of

authority & environmen data
communication t
Production
& service Improvements
Management provision
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Reviews
Deming Prizes (1951)

31
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Malcolm Baldrige National Quality
Award (1987)

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Australian Quality Award (1988)

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European Quality Award (1991)

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

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 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

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 EQA 2. Policy and strategy

 Relevant policy and procedures

 Sound & focused strategy
 Deployment of policies and strategies

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 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

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EQA 4. Processes
 Optimized product/ service process
 Synergized service processes
 Proper planning & control
 Integrated business process
 Review and improvement of process

EQA 5. Customer satisfaction/focus

 Exceeding external customers’ expectation
 Meeting internal customers’ satisfaction
 Review and evaluation of customers’ satisfaction
 Level of product/ service quality 39
EQA 6. Business Performance

 Degree of financial performance

 High market share
 Increased productivity

EQA 7. Impact on society

 Significant socio-economic impact

 Enhanced environmental impact
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 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
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 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

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 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

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 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

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 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

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 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

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 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

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 Reasons for Companies to Comply
 A study conducted by Rayner and Porter:

10% - Other reasons

35% - Pressured by
10% - Improve quality
customers

15% - Access new

markets

15% - Gain 15% - Need to

competitive anticipate
advantage registration

 80% of the firms considered marketing as the main reason to be

certified by ISO 9000 48
 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

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 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

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 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

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Benefits Of ISO 9001:2000 Certification
 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.

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 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

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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

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 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

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 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

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 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

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 How to implement ISO 9000

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

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 How to implement ISO 9000

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

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 How to implement ISO 9000

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

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 How to implement ISO 9000

5. Write a Quality Policy

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

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 How to implement ISO 9000

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

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 How to implement ISO 9000

7. Create a manual
 A manual needs to be compiled of all the
company’s processes and contain the best
practices

63
 How to implement ISO 9000

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

64
 How to implement ISO 9000

9. Get certified
Find an internationally well-known and
credible group to certify the company
Allowed to announce certification to clients
after this step

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 How to implement ISO 9000

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

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Thank you!

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