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Applying for an ISO registration can be intimidating. Most companies apply for ISO registration because a major customer insists on it. However, keeping that customer’s business is only the beginning.
The primary benefit ISO standards deliver is continual improvement. Perfect processes do not exist-every process has variation within it. Continual improvement is the constant evaluation of processes to reduce variation, enabling them to work better, quicker and less expensively. In short, continual improvement ensures that the company will not only cover the costs involved in ISO registration, but also will experience ongoing economic benefits.
Following are a few tips to help guide managers preparing for ISO registration.
Tip #1: Identify your company’s core competencies.
When companies apply, registrars will ask for a list of the core competencies, or key processes, that are critical to the ongoing survival of the company. The three main ways to identify these core competencies are a process flow chart, value-stream map or what is commonly referred to as the “Vision-Mission-Measures-Metrics” exercise. This exercise asks a few key questions:
Who are our internal and external customers, and what products are manufacture for them?
What are the key processes used to make these products and, if they were lost, would it jeopardize the enterprise?
What needs to be done so the company continues to evolve with the market?
What needs to be done to eliminate waste in the enterprise?
The answers to the last three questions are the company’s core competencies.
Tip #2: Do a Cost-of-Quality (COQ) Assessment.
Every ISO standard requires preventive action be taken to avoid compromising product quality. A COQ assessment helps companies meet this requirement by identifying the common sources of quality failure. Improving processes will not be possible until it is determined what it actually costs to make product, gather process performance data and tie that data back to dollar bills in terms of prevention cost, assessment cost and failure cost.
As the company goes through the ISO registration process, changes in the way business is done will occur. Money will be spent improving processes, but the upside is these improvements should help the company save money as well.
Tip #3: Do a Root Cause Analysis (RCA) of the elements driving the cost of quality.
RCA determines what factors-including people, material, method, measures, machines and environment-contribute to the cost of quality. Not doing RCA is like being really good at putting out fires, but not finding the guy with the matches setting the fires in the first place. Cost of quality is composed of appraisal, prevention and failure. The appraisal process-which includes material review board initiatives, inspections and more-identifies specific costs by dollar amount, and builds a plan to save money by reducing or even eliminating these costs. Prevention costs are derived from preventive action and should yield a measurable payoff. Failure costs can be eliminated by ensuring first-pass-yield is near 100%; in other words, ensuring product quality the first time. Failure modes and effects analysis is another RCA tool that traces a failure back to a specific event, which then can be eliminated.
Tip #4: Build process stability for core competencies.
ISO registration demands high levels of repeatability for core competencies. Remember, there are no perfect processes. The trick is to build a process that is repeatable, meaning it makes the same product every time. After identifying core competencies, process performance measures/metrics should be applied to determine if processes are functioning in a highly repeatable manner.
Repeatable processes allow companies to determine failure rates. Studying failure rates using cost analysis and other tools helps managers incrementally improve the process and reduce variation within it. A highly repeatable process delivers high levels of reliability. For example, a highly repeatable manufacturing process might guarantee that when a piece of aluminum is inserted into a machining center, the process is going to deliver parts that are identical within a thousandth of an inch.
Tip #5: Apply continual improvement initiatives to eliminate variation.
Registrars want to see an applicant put auditing systems into place that, over years of time, demonstrate the company is focused on product quality and continual improvement of the process. These audits should include review and analysis of performance data and corrective action the company takes whenever the process delivers a product that is outside of the control limits. Having an effective auditing system in place ahead of time makes it much easier to get registered.
Tip #6: Identify the right standard and registrar.
For many companies, the industry they are competing in determines the standard they apply for, such as AS 9100 for aerospace manufacturing. If a company does not fit into a specific industry niche, doing a little research can narrow down the choices. First, it needs to be determined which standard/registrar competitors are choosing. Then, trade and technical organizations, such as the Society of Manufacturing Engineers (SME, www.sme.org) or the American Society of Quality (ASQ, www.asq.org), can be contacted to determine where industry is headed. Different levels of registrars exist. In general, companies get what they pay for. It pays to select one that is well respected in the industry and by a company’s customer base.