Efficiency and profitability are the most important motivations of every organization. Regardless of size, industry, or geographical location, all businesses are constantly looking to improve their efficiency and maximize their profitability. In the Philippine Construction Industry, which generated a value of P366 billion last 2014, competition to bid for projects is intense. So how does one stand above the rest? By adapting the new ISO 9001:2015 Quality Management System which has been recently published. The new standard, although not a complete overhaul, requires many changes to the 2008 standard. So what changes will the 2015 bring to the Construction Industry?
RISK BASED THINKING
The 2015 standard has been formulated so that organizations will think for themselves. With that in mind, the new standard wants organizations to approach all aspects of their respective quality management and analyse potential risks, whether it is an internal process, an external outsourced process and suppliers. The new standard ensures that output matters and it wants to make sure organizations are delivering as promised, and in order for organizations to deliver on time and per specification, risk is analysed and measured.
But do not confuse the terms risk and hazard when it comes to your approach in risk management. Hazard is a condition or situation that creates the opportunities for problems to occur. They are the events each day that raises the potential of accidents to happen. Risk is the likelihood the hazard will lead to the negative consequence. In short, by mitigating the risk, we would be avoiding the hazardous situation. The key here is when an organization knows its hazards, you can estimate the probability of the risk. The new standard has thus removed the term ‘preventive action’ as the new standard ideally wants organizations to identify and mitigate any potential problems, thus minimizing disruption to the daily operations.
Ultimately, it will be management’ s involvement and strategic decision on how a company plans to approach and counteract these risks, which leads us to the next major change in the 2015 standard.
- Possible road construction delay due to rainy season
- Possible force majeure issues leading to unworkable weather conditions (e.g. heavy rain, flood, and landslide)
Development & Evaluation of Risk Assessment Methods
- Acceptance – Leave it if it’s worth the risk
- Reduction – Take steps to mitigate the risk
- Compensation – Take steps to insure yourself against the risk
- Transfer – Outsource the risk to a partner I supplier
- Avoidance – Stop the process altogether
Risk Management Decision
Delay or advance construction to not coincide with rainy season, obtain weather charts and data for a data-driven decision if construction timeline has to be pushed.
With the new standard, involving top management is no longer optional. The term ‘Quality Management Representative’ or ‘QMR’ has been removed from the latest standard and has been replaced with ‘Leadership’. Ideally, the new standard requires 3 things from Leadership –
Take accountability for the effectiveness of the quality management system.
By taking accountability, the QMS will become part of the business processes, not a side project. When your leaders are accountable they will want to know, need to know all the new requirements which will take their attention, time, and resources necessary which will need to be reviewed and addressed by the management.
Ensure that the quality policy and quality objectives are established for the QMS and are compatible with the context of and strategic direction of the organization.
This will most clearly require top management involvement. Can a Quality Management Representative define the company context-scope and purpose, strategic direction, interested internal and external parties and review of requirements? In rare cases yes, but majority do not have the access to that kind of information which could only be available to the inner-circle of an organization, thus circling back to upper management’s responsibility of QMS establishment.
Ensure the integration of the QMS requirements into the organization’s business processes.
This requirement might have a little volatility in it. Based on observation, there is usually a gap between the business process and the quality process, and should management choose to force the quality process, workers might experience a bit of a culture-shock and choose to resist implementation. Therefore, management should have a light hand when it comes to this requirement, and make sure management team and the ISO core quality team are hand in hand to ensure a smooth transition to the 2015 standard.
On the creation of this clause, this does not mean an abolishment of the QMR position. It is up to each organization to assess their respective positions, if the QMR position is effective, then, by all means, continue as is, but management cannot keep relying on the QMR when it comes to the quality process, at some point, management have to step-in and assume certain responsibilities as well . Nigel Croft, Chair of the ISO subcommittee responsible for ISO 9001, mentioned during the introduction of the ISO 9001:2015 video conference briefing that “Management who have taken the minimal approach in achieving certification will have trouble implementing the new standard”. This is a wakeup call to organizations w h o s e management have been lax when implementing their QMS. Quality cannot be bought, and the new standards’ leadership clause ensures it.
There is now an even heavier emphasis on Clause 4.4 of the ISO 9001:2015 standard. The Process Approach requires organizations to look at each step of its process, and ask themselves of its effectivity. If your organization has not been using the PDCA Cycle, now is the time, as if your organization has not been utilizing this, auditors are obligated to ask about your process and how it can be improved further. The new emphasis on the process approach encourages organizations to be proactive rather than reactive so they can identify their most important processes. Ensuring that they are efficient, effective and making improvements where necessary. Simple compliance of a process will not be tolerated, auditors and accreditation bodies will now start asking if a process is effective, and if not, what measures are being taken to improve.
By utilizing and placing importance in the Process Approach, the purpose of each department will be clarified. Usually in the construction industry, there is not enough understanding of the consequences that ripple out from one department being poor. For example, if the purchasing department were cutting corners by obtaining poor quality resources, it affects the entire production process.
CONTEXT OF THE ORGANIZATION
In an entirely new clause, the 2015 standard is requiring organizations to determine the issues and requirements that can impact the planning of the quality management system .
Determining what is relevant or not relevant is dependent on whether or not it has an impact on the organization’s ability to consistently provide products and services that meet customer and applicable statutory and regulatory requirements or the organization’s aim to enhance customer satisfaction. However, any organization can decide to determine additional needs and expectations that will meet its quality objectives
Your organization’s v1s1on, m1ss1on, strategic objectives and direction, your organizational chart, Standard Operating Procedures, resources, culture, contractual relationships – these and more, are factors you should consider when making all decisions and when addressing uncertainties about the future. While the legal, social, political, regulatory, financial, economic, key drivers, trends, natural and competitive environment, and perceptions of stakeholders (or interested parties) are all part of your external context. Each of these factors should be considered in the course of business leadership, when managing risk or uncertainty, and when making decisions that may affect the quality or service you provide.
Luckily for the construction industry, as written by Pavlos lnglesias of qualityinconstruction.com, “This is something that is already happening in the construction industry because of the nature of the industry with its different trades, subcontractors, Clients, third parties, authorities etc. This is not really changing anything, but it does force organizations towards better subcontractors and stakeholders management.” Looking back at this clause, there is a strong need to apply the risk-based thinking approach that was mentioned earlier when identifying these factors, which enforces the standards’ want of organizations thinking for themselves
Not entirely a game changing clause, but more of a guideline developed to ensure that all future ISO management system standards would share a common format, irrespective of the discipline to which they relate.
This makes it easier for construction companies who understand the effectivity in the QMS, and want to move into OSHAS and EMS to ensure a higher quality of service, creating an Integrated Management System. In fact, this would even promote the creation of an Integrated Management System due to uniformity required in each standard and the ease of implementation.
Say goodbye to paper work! ISO 9001:2015 is not requiring documented procedures, quality manual and quality records anymore. Furthermore, the new standard does not specifically state the requirement for the format and storage methods of the information. But the standard does refer to “documented information”. Lack of paper work does not mean an organization can be negligent in its documentation process. Auditors will still require proof as to how, when, where, and what process was done. Also, control of documents and records, or basic information security management procedures are as strict as ever. Regardless, it will be the organizations decision on how documentation procedures are to continue, if the paper-route is effective, why the need to change?
With all the new requirements, around about now, you might be asking as why your organization should update to the new standard. Why the need to update when you’re current QMS is perfectly adequate to your daily operations? Here are a few good reasons to update –
Your organization will remain relevant to the highly competitive industry of today.
By upgrading to the 2015 standard, your organization has understood that it is agreeing to add even more credibility to its service, demonstrating the need to meet the expectation of its customer and has agreed to, as ISO states it, ‘continually improve’ itself by remaining modern and adaptive of new practices.
Integrate with other Management Systems
As mentioned earlier, the new standard, along with its annexes, help promote a possibility of an organization adopting other management systems, transforming a Quality Management System into an Integrated Management System. Why stop at QMS? Take your organization one step further and trump the competition.
Foundation for the next 10 years
If your organization is an early adapter to the new standard, this will become your organizations bedrock for years to come. Doing so will make your product or service synonymous with the word ‘quality’.
Provide Organizational Management
As stated in the Process Approach, everything will be scrutinized in the 2015 standard. This, in turn, will lead to a better understanding of personnel designation, a question of what does one do, and who does what.
Reflect the needs of all potential users
Through the risk-based approach, the 2015 standard is asking organizations to look at all aspects of its organization. By doing so, this will analyse the risks and needs of all users. Mitigating any delay and faults in your organizations product and service. Help potential users help you.
Enhances organizations’ ability to satisfy customers
Ultimately, an organization implements a QMS to satisfy its customers’ needs. By adapting the 2015 standard, an organization understands today’s needs and shifts in order to reciprocate the needs of modern time
One key point to take in all of the new changes though is, adapting the ISO 9001 :2015 should not be all about the certification, but it should be an organization implementing a robust quality management system that help them achieve their objectives and satisfying the customers’ expecta tions.
The construction industry is a competitive industry, and it only offers two possibilities, as the American Political economist Lester Thurrow sees it, “You can lose. Or, if you want to win, you can change.”
Is your organization up to the change?