An international standard of quality
With quality becoming the cornerstone of global competition, companies are requiring assurance of standard conformance from suppliers just as their customers are requiring the same from them ISO 9000 certification has also been found too positively affect the performance and stock prices of firms.
ISO 9000 a series of five international industrial standards (ISO 9000–9004) originally designed by the International Organization for standardization in Geneva to meet the need for product quality assurances in purchasing agreements are becoming a quality assurance certification program that has competitive and legal ramifications when doing business in the European Union and elsewhere. The original ISO 9000 system was promulgated in 1994. In 2000 the system was streamlined as it will be again in 2006. ISO 9000 concerns the registration and certification of a manufacturer’s quality system. It is a certification of the existence of a quality control system a company has in place to ensure it can meet published quality standards. ISO 9000 standards do not apply to specific products. They relate to generic system standards that enable a company, through a mix of internal and external audits, to provide assurance that it has a quality control system. It is a certification of the production process only, and does not guarantee that a manufacturer produces a quality product or services. The series describes three quality system models, defines quality concepts and gives guidelines for using international standards in quality systems.
To receive ISO 9000 certification a company requests certifying body (a third party authorized to provide an ISO 9000 audit) to conduct a registration assessment – that is, an audit of the key business processes of a company. The assessor will ask questions about everything from blueprints to sales calls to filing. Does the supplier meet promised delivery dates? And Is there evidence of customer satisfaction? Are two of the questions asked and the issues explored? The object is to develop a comprehensive plan to ensure that minute details are not overlooked. The assessor helps management create a quality manual, which will be made available to customers wishing to verify the organization’s reliability. When accreditation is granted, the company receives certification. A complete assessment for recertification is done every four years, with intermediate evaluations during the four year period.
Although ISO 9000 is generally voluntary except for certain regulated products, the EU Product Liability Directive puts pressure on all companies to become certified. The directive holds that a manufacturer, including an exporter, will be liable, regardless of fault or negligence if a person is harmed by a product that fails because of a faulty component. Thus customers in the EU need to be assured that the components of their products are free of defects or deficiencies A manufacture with a well documented quality system will be better able to prove that products are defect free and thus minimize liability claims.
A strong level of interest in ISO 9000 is being driven more by marketplace requirements than by government regulations and ISO 9000 is now an important competitive marketing tool in Europe and around the world. As the market demands quality and more and more companies adopt some form of TQM, manufacturers are increasingly requiring ISO 9000 registration of their suppliers Companies manufacturing parts components in China are quickly discovering that ISO 9000 certification is a virtual necessity, and the Japanese construction industry now requires ISO 9000 as part of the government procurement process. More and more buyers particularly those in Europe are refusing to buy from manufacturers that do not have internationally recognized third party proof of their quality capabilities. ISO 9000 may also be used to serve as a means of differentiating classes of suppliers particularly in high tech areas where high product reliability is crucial. In other words, if two suppliers are competing for the same contract, the one with ISO 9000 registration may have a competitive edge.
Although more and more countries (now more than 100) and companies continue to adopt ISO 9000 standards, many have complaints about the system and its spread. For example, 39 electronics companies battled against special Japanese software criteria for ISO 9000. Electronics companies also protested against the established of a new ISO health and safety standard. Still others are calling for more comprehensive international standards along the lines of America’s Malcolm Baldrige Award, which considers seen criteria – leadership, strategic planning customers and market focus, information and analysis human resources development management and business results. The telecommunications industry recently promulgated an industry specific TL 9000 certification program, which combines aspects of ISO 9000 and several other international quality standards.