Issue 47 – March 2013
This article by Dick Hortensius, Senior Standardisation Consultant at the Netherlands Standardization Institute first appeared in the International Organization for Standardization's (ISO) ISO Focus+ February 2013. It is summarised here with permission from ISO.
Yearly surveys on the application of the ISO management system Standards (MSSs) show a steady worldwide increase in certifications based on ISO 9001 (Quality management systems – Requirements) and ISO 14001 (Environmental management systems – Requirements with guidance for use). However, while these surveys do not indicate the size of the organisations that have implemented the Standards, experience in the Netherlands and other countries shows that a growing number of small to medium-sized enterprises (SMEs) implement multiple MSSs, though some face difficulties in doing so and need help.
Why do SMEs implement integrated management systems?
The main reason is that many SMEs are suppliers to large companies that impose quality and environmental requirements on their supply chain. In many cases, these requirements can only be met by implementing a management system and being certified. In addition, governments apply quality, environmental, and even sustainability criteria in their purchasing and procurement activities. SMEs are therefore forced to implement quality and environmental management systems to stay in business.
What are the difficulties and how can ISO help?
Although MSSs are applicable to any organisation, regardless of type and size, it is generally acknowledged that SMEs face specific difficulties when implementing these Standards, particularly when implementing multiple Standards together. The reasons are manifold and partly outside the influence of ISO and its member bodies, such as limited resources (money, time, and people). However, there are also reasons related to the Standards themselves where ISO and its member bodies can help make life easier for SMEs.
The first reason is that MSSs are written in a language that can be quite difficult to understand and may contain elements that suggest the systems are bureaucratic and intended only for large organisations. In response, ISO has published a handbook, ISO 9001 for small businesses – What to do. The handbook explains each ISO 9001 requirement in easy-to-read language and provides examples on how SMEs should implement them. Similar publications exist for environmental, food safety, and information security management systems.
The second is that the various ISO MSSs are based on different models, specify different elements, and state similar requirements in different wording. Although the Standards are compatible and the models are not contradictory, this does not make life easy for an SME wishing to implement the Standards in an integrated way. Recently, ISO has taken important steps to improve MSS alignment by defining the structure and core requirements that apply to any management system. This will certainly help not only SMEs but also all organisations in applying multiple MSSs to their business processes.
Integrated use of MSSs
The ISO handbook The integrated use of management system Standards addresses both of the Standards-related reasons why SMEs struggle with the implementation of quality and environmental management. In essence, the handbook clearly shows how the management system elements specified in abstract language are related to an organisation's daily operational and management processes. The handbook:
- provides a clear pathway for integrated MSS implementation. The manual uses the imaginary case of Jim the Baker to illustrate the approach. Jim runs a bakery in the centre of a small town. By applying sound management, and supported by management system Standards, his business expands to provide catering services for large organisations
- shows how the formal elements of a single management system are related to the processes and managerial activities of a shop employing six people, and how multiple MSS requirements are related to, and support, a medium-sized catering company with a regional scope. In addition to this imaginary example, the book contains many real-life illustrations taken from case studies included in an accompanying CD-ROM.
Key factors for successful MSS implementation in an SME
There are many factors that influence the success of MSS implementation by an SME – those below are also addressed extensively in the ISO handbook.
1. Stick to your existing management system
Any organisation that stays in business and is able to provide products and services to its customers operates a management system, however lean or informal. This system, in whatever form, should be taken as the basis and starting point for implementing an MSS such as ISO 9001. Implementing ISO 9001 does not mean you 'build' a (new) quality management system, but that you evaluate your current management practices against ISO 9001 requirements and adapt and add where necessary. Therefore, every management system is unique and an organisation should not buy a handbook from the internet or apply standard procedures provided by a consultant. The risk is that these tools may not fit, will add bureaucracy, will not be seen by employees as adding value, and are only likely to be activated when the annual certification audit is imminent!
The difficulty is to link abstract requirements to real-life processes and management practices. Once an organisation has been able to do this, the extent to which the requirements are already being met – and what must still be done by adapting and not by rebuilding – becomes clear. Informal management practices sometimes need to be formalised (for example, some records should be maintained to demonstrate that things have been done), but in many cases this contributes to the effectiveness and efficiency of the operations, and thus adds value to the organisation.
2. A management system is not identical to documented procedures
A management system is a tool to help achieve organisational objectives. Any measure taken should be consistent with the basic objective of the system – does it help in doing a better job, in being more successful, and in achieving the business plan? There are many measures that can contribute to this objective, for example raising personnel competence, adopting 'fool proof' technical devices, using pictograms, using handy forms to check and fill out (which later become records as well), and so on. However, one should hesitate before establishing extensive documented procedures, especially in SME situations, because in many cases this does not align with organisational culture and daily practices.
3. Look for the commonalities between different MSSs
Although worded differently, all MSSs are based on the same fundamental concepts.
- Process management and control: Ensure that processes deliver the intended results and that applicable requirements are complied with.
- Plan-Do-Check-Act approach to management and process control: Establish objectives, define the processes needed, monitor progress and compliance, take action where necessary, and consider improvement opportunities.
- Risk management: Identify the risks that provide threats and opportunities, and implement controls to minimise negative effects on performance and maximise potential benefits.
Quality management carries the risk that customers are not satisfied and that quality-related (legal and customer) requirements are not met. The risk in environmental management is that the environmental performance does not meet legal requirements, stakeholder expectations, and/or the organisation's own policy objectives.
MSSs specify very similar elements based on these concepts that should be part of the organisation's overall management system. Considering the requirements of the Standards with these basic concepts in mind will assist SMEs in interpreting and applying them in an integrated way.
4. Keep it simple
Less is better and small is beautiful in many situations where management systems are implemented – especially for SMEs. By keeping the first three key factors in mind, SMEs should be able to adapt the system to suit the size and complexity of the organisation. It is possible to conform to the requirements of ISO 9001 and ISO 14001 without extensive documentation.
Flowcharts and forms are in many cases more effective than documented procedures, and records often provide more added value than process descriptions. Specifying what to do is preferable to describing how to do it, and can be done more concisely. It is important that the design of controls be in line with the culture of the organisation and the level of competence of the personnel.
Not just for large organisations
Management systems and MSSs are not just tools for large organisations. Given the trend towards outsourcing activities and the growing importance of cooperation in the value chain, effective MSS implementation by SMEs is of key importance in facilitating trade and promoting sustainable development.
ISO MSSs can be implemented in an integrated way by SMEs, and can add value to their businesses if some key factors for success are taken into account. ISO has already published useful SME guidance and will develop its future Standards in a way that facilitates the implementation and integration of multiple Standards.
Summarised from ISO Focus+, February 2013.
Note: You can order ISO Standards from www.standards.co.nz or call 0800 782 632 during business hours or email email@example.com. Members of Standards New Zealand receive a 20% discount on all NZS and AS/NZS Standards, and a 10% discount on all international Standards. Visit our membership page for more information.
Note: As New Zealand's representative for the International Organization for Standardization (ISO) and the International Electrotechnical Commission (IEC), Standards New Zealand ensures that New Zealand has a voice in the international Standards community.