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The New Process in Auditing


QualityZoneISO 9000 has changed for the better, focusing on the way businesses are run and processes that deliver quality products and services. Companies will have greater opportunities to profit from the standard and quality professionals will be able to take a greater role

The requirements of the new standard, some of which were in the 1994 version and others which are more aligned to Total Quality Management (TQM), give companies the perfect opportunity to make changes for greater success. These requirements include:

  • the need for greater top management involvement and commitment to the quality system and its development

  • the chance to redefine traditional bureaucratic documented systems in a format more appropriate to the process approach and the computerised age

  • the opportunity to step away from simple compliance-based auditing and use auditing to identify business improvement opportunities

  • the opportunity to escape the 20 functionally-based requirements and concentrate on the business processes

  • understanding customer satisfaction is a fundamental requirement of the new standard, and an opportunity for business success

  • demonstration by companies of a continual improvement - this is the perfect opportunity to implement appropriate processes.

Fine in theory, but does it work? The answer is that yes, it appears to.

A practical example

In our training business, we have been working work one of our clients, Schneider Electric Limited, examining its QMS processes as part of a training programme against the new FDIS version of the standard. The company provides electrical and electronic switching, power management, distribution, control and automation systems to a worldwide market. The company has always taken a progressive approach to quality and decided that the FDIS was definitive enough to start making the necessary changes.

Out of its nine sites in the UK, three were chosen and briefings arranged with representatives. The initial outcome was a generic top-level description of the business processes. The excellent model shown in the book Converting a QMS Using the Process Approach, by David Hoyle and John Thompson, was used as the starting point for this. This so closely fitted the company's main business processes that only minor changes were necessary.

A main business process – order fulfillment — was chosen as the subject of the team training exercise. It was decided that an audit would be done on each site, in order to maintain consistency and provide a basis for comparison of results, with teams predominantly made up of staff from other sites. Although the auditing experience varied greatly, everyone had a quality background and most had experience of being audited.

New approach to auditing

The teams' objectives were to:
  • define a top-level business process by identifying its sub-processes

  • examine the current 1994-based systems for adequacy against the 2000 standard requirements and recommend improvements

  • carry out a positional audit of the current QMS for the order fulfillment process against the new version

  • make recommendations for improvements to the overall business.

The teams had two days to:

  • learn and understand the new concepts and detailed requirements of the new standard

  • examine the existing documentation and make recommendations for change
  • carry out a process-based audit

  • produce a presentation of the findings

  • produce a business impact matrix, showing the estimated costs and benefits of the recommended changes

  • make a presentation to the senior management on each site

No one was surprised when the teams discovered that the current documentation, which was based on the 1994 version of the standard:

  • was over-prescriptive

  • addressed the departmental functions, but did not adequately address the linked business processes

  • in many cases lacked process maps (flow charts)

  • had significant gaps at interfaces between functions.

The order fulfilment process commenced at the enquiry/order receipt stage and finished at the dispatch warehouse, with procurement, material control, manufacturing, assembly and test stages forming the main sub-processes. To maintain a focus it was decided to concentrate on a particular product group, manufactured onsite, which involved the whole process.

Each team was allocated a third of the overall process - examining three sub-processes - and appointed a leader, who acted as the link with other groups (a balance of auditing experience was selected for each team).

The first task was to define the process in flow chart format - which was kept at a high level and only drilled down to sub-processes where necessary — with reference being made to existing documented procedures. In several cases the existing documented procedures, because they were task-oriented, did not adequately describe the process controls.

To maintain consistency between the teams checklists were compiled which concentrated on the process. These differed significantly from checklists used with the 1994 standard because, rather than looking for compliance, they challenged the process. The audit teams were allowed three hours on the second day to complete the audit. Some rules were set:

  • Auditors would concentrate on significant features, rather than reporting detail, such as the occasional missing signature.

  • Non-conformities would be reported only if they threatened the company's existing ISO certification. All other observations would be considered as opportunities for improvement.

The audit comprised an opening briefing with management involvement in the order fulfilment process, followed by the audit of the process. Each team audited in pairs to optimise the audit resource. From an observer’s perspective, the auditees quickly lost any defensive attitudes when they realised the auditors were concentrating on the main issues. There appeared to be a genuine desire to let the auditors see the real issues. In group discussions afterwards, experienced members of the audit teams said they felt the process approach – looking for opportunities for improvement – was more rewarding and meaningful than the previous compliance approach.

Findings and Results

The company’s audit documentation, which focused on non-conformities, was modified to stress opportunities for improvement. The teams:

  • checked their original flow charts to determine if they accurately reflected the process and made any corrections (people liaised between the groups to clarify the process interfaces)

  • documented opportunities for improvement and any significant non-conformities against the 1994 standard

  • identified common opportunities for improvement

  • ranked opportunities for improvement in order of significance based on impact on the company’s operation

  • constructed a cost/benefit matrix

The senior management were given a PowerPoint presentation, with contributiosn from the individual team members. The reactions included:
  • ”This was a very worthwhile exercise”.

  • ”In most cases, you have probably told us what we already knew (not documented under the ‘functional audit’ system), but now we will have to do something about it”.

  • ”There are a few surprises”.

Process auditing at a higher level than the functional audits of the past, adds value to the internal audit process. The visual presentation of the audit results on a business impact matrix provided senior management with a focus, expressed on a language they understood and both parties – auditors and auditees – gained something meaningful from the audit.

The Way Ahead

For progressive companies, the new standard offers opportunities to drive performance forward. In the above case, the standard is totally compatible with group-wide initiatives already implemented (ISO 14001, CIP). For companies that have addressed the standard simply to obtain certification, the new approach will require significant effort, but the rewards in terms of business performance, could be significant. For those companies that have not yet obtained certification, the new standard offers opportunities to set up a QMS which really contributes to the success of the organisation, with the further advantage that it readily lends itself to incorporation into an IMS. Companies are free to take on the new process-based approach without being hampered by functionally based systems and documentation.

For further details, contact:

ISO 2000 Worldwide Ltd
+44 (0) 1249 460101


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