BUS 4406 – Quality Management

Description

INTRODUCTION

In this unit, we study the most universal tool available in Quality Management: the ISO (International Standard Organization) 9000 set of standards. We take a look at its fundamental guiding principles and its basic components, and examine the benefits and drawbacks of a certification for an organization. We also examine the most significant Excellence awards.

We then apply all that we have studied so far to quality management in the service industry. While the fundamental principles are very similar to quality management for manufactured products, services offer some specificities that need to be addressed. We therefore look at a framework of quality evaluation and management that has to be put in place before using the tools we have studied thus far.

READING ASSIGNMENT

Quality Management (Knowles) Chapter 5 – pp. 38-50, Chapter 14 – pp. 167-176

http://asq.org/learn-about-quality/iso-9000/overview/overview.html

Back to Basics: ISO 9001 Made Easy

ISO 9000: Is it Worth It? Available for download here.

DISCUSSION ASSIGNMENT

Do you think that the benefits an organization gets from an ISO9001 certification is worth the cost, time and paperwork required? Discuss the benefits and advantages, real or claimed, and the costs of a certification.

Please answer in 200 words or more. As usual, use your own words – please do not copy and paste from a web site. Be sure to reference your sources.

Then, engage in a dialogue with your classmates on the above issue and any other perspective you may have on the topic. You are expected to make at least three posts to the discussion forum during the course of the discussion period.

Don’t forget to rate the postings of your classmates according to the Rating Guidelines.

Happy discussing!

WRITTEN ASSIGNMENT

Case Study 3: The Culture of Quality at Arnold Palmer Hospital

Founded in 1989, Arnold Palmer Hospital is one of the largest hospitals for women and children in the U.S., with 431 beds in two facilities totaling 676,000 square feet. Located in downtown Orlando, Florida, and named after its famed golf benefactor, the hospital, with more than 2,000 employees serves an 18- county area in central Florida and is the only Level 1 trauma center for children in that region. Arnold Palmer Hospital provides a broad range of medical services including neonatal and pediatric intensive care, pediatric oncology and cardiology, care for high-risk pregnancies, and maternal intensive care.

The Issue of Assessing Quality Health Care.

Quality health care is a goal all hospitals profess, but Arnold Palmer Hospital has actually developed comprehensive and scientific means of asking customers to judge the quality of care they receive. Participating in a national benchmark comparison against other hospitals, Arnold Palmer Hospital consistently scores in the top 10% in overall patient satisfaction. Executive Director Kathy Swanson states, “Hospitals in this area will be distinguished largely on the basis of their customer satisfaction. We must have accurate information about how our patients and their families judge the quality of our care, so I follow the questionnaire results daily. The in-depth survey helps me and others on my team to gain quick knowledge from patient feedback.” Arnold Palmer Hospital employees are empowered to provide gifts in value up to $200 to patients who find reason to complain about any hospital service such as food, courtesy, responsiveness, or cleanliness.

Swanson doesn’t focus just on the customer surveys, which are mailed to patients one week after discharge, but also on a variety of internal measures. These measures usually start at the grassroots level, where the staff sees a problem and develops ways to track performance. The hospital’s longstanding philosophy supports the concept that each patient is important and respected as a person. That patient has the right to comprehensive, compassionate family-centered health care provided by a knowledgeable physician-directed team.

Some of the measures Swanson carefully monitors for continuous improvement are morbidity, infection rates, readmission rates, costs per case, and length of stays. The tools she uses daily include Pareto charts, flow- and process charts, in addition to benchmarking against hospitals both nationally and in the southeast region.

The result of all of these efforts has been a quality culture as manifested in Arnold Palmer’s high ranking in patient satisfaction and one of the highest survival rates of critically ill babies.

Questions:

Would becoming ISO certified benefit more Arnold Hospital than implementing Six Sigma initiatives? Give at least 3 reasons properly explained.
Should management at Arnold Hospital control all processes tightly? Why? Give minimum 2 reasons properly explained?
What in your opinion should be monitored continuously and why?
How could Arnold Hospital thrive towards Excellence? Explain. (give 5 different means).
Develop a fish-bone diagram illustrating the quality variables for the ICU (Intensive Care Unit) at Arnold Hospital. Include causes and sub-causes.
At Arnold Hospital, daily tools adopted are Pareto charts, flowcharts and process chart. Give an example of how can they adopt a Pareto chart and illustrate it (draw it). Give as well an example of how they can adopt a flowchart and illustrate it. Explain assumptions as needed.
Suggest another tool to be adopted by Arnold Hospital and explain its importance. Give an example of how it could be used and illustrate it.
LEARNING JOURNAL

In the learning journal, you should record your activities, and record problems you may have encountered, as well as your notes and thoughts about the material. In addition, you should consider the following questions for reflection:

Search the Internet to find current registration trends for ISO9000. What did you find? How widespread is ISO9000 in your region of the world compared to other regions?

Please answer these questions in 300 words or more. Your answer should reflect your personal experience and should be thoughtful and introspective.

Unformatted Attachment Preview

BACK TO
BASICS
ISO 9001 Made Easy
by Syed Hasan Jaffrey
I
SO 9001 is a quality management
system (QMS) standard that
requires an organization to meet its
own requirements and those of its
customers and regulators. It is based
on the plan-do-check-act methodology, which helps organizations establish, implement, monitor and measure
their processes to deliver results that
align with the organization’s requirements and continually improve performance by taking appropriate
action.
ISO 9001 is made up of eight sections: scope, normative reference,
terms and definitions, quality management system, management responsibility, resource management, product
realization and measurement, analysis
and improvement.1 The first three sections provide general information
about the standard, and the last five
focus on how to implement it.
Section 1—scope: specifies that the
organization needs to meet customer
and regulatory requirements and
ensure its employees follow its policies
and procedures while advancing quality through continual improvement.
Section 2—normative reference:
provides normative references—those
that conform to ISO 9000’s related
norms—to constitute the terms of ISO
9001.
Section 3—terms and definitions:
defines the terms used in the standard
and highlights the differences between
the 2000 version and the 1994 version.
Section 4—quality management
system: describes the standard’s general requirements, which encompass
all activities from quality manual documentation and control of documents
and records to determining the
sequence and interaction of the
processes to implementing actions to
achieve planned results.
Section 5—management responsibility: requires management’s commitment to the QMS and explains that
management must be dedicated to the
organization’s products, customers
and planning and review processes.
Section 6—resource management:
provides the criteria needed to per104
I MAY 2004 I www.asq.org
FIGURE 1
A Process Approach
Input (customer requirements)
Process
form a job competently and in a safe
environment. Human resources, infrastructure planning and work environment are discussed in this section.
A straightforward
look at one of the
world’s most popular
standards.
Section 7—product realization:
defines the steps in product development. These steps include everything
from the initial design phase to the
final delivery phase. For example:
product realization planning, customer related processes, design and
development, the product purchasing
process, production and service provisions and the control of monitoring
and measuring devices.
Section 8—measurement, analysis
and improvement: focuses on measuring, analyzing and improving the
QMS by having companies perform
periodical internal audits, monitor
customer satisfaction, control nonconforming product, analyze data and
take corrective and preventive actions.
To ease implementation, ISO 9001
suggests companies adopt a process
approach, which is a series of operations
that transform inputs into value added
output (see Figure 1). A process can be
measured by accuracy, timeliness, cycle
time, downtime, efficiency, effectiveness,
turnaround and setup time.
Output (satisfied customer)
well-organized QMS.
• It creates satisfied customers,
management and employees.
• It helps companies continually
improve.
ISO 9001:2000 certification authenticates the high quality standards of an
organization. Besides benefiting the
employees, it also benefits the organization by organizing its processes. It
not only gives flexible criteria, but also
allows an organization to monitor and
increase the efficiency of its processes.
To achieve certification, a company
must:
• Follow the guidelines of the ISO
9001 standard.
• Fulfill its own requirements and
those of its customers.
• Follow statutory and regulatory
requirements.
• Create documents.
• Keep track of records.
And always remember to say what
you do and do what you say. In other
words, be honest.
REFERENCE
1. ANSI/ISO/ASQ Q9001-2000: Quality
Management Systems: Requirements, International
Organization for Standardization, www.iso.org.
SYED HASAN JAFFREY is a quality assur-
ance engineer at Delta Search Labs Inc. in
Cambridge, MA. He earned a master’s in
information systems engineering from Western
International University in Phoenix and is a
member of ASQ.
Please
comment
If you would like to comment on
Benefits
this article, please post your remarks
Of the many benefits of ISO 9001:
2000, these are the three most significant:
• It provides a framework for a
on the Quality Progress Discussion
Board at www.asq.org, or e-mail
them to [email protected].
ISO 9000: An Effective Quality System
by Chris Amponsah, Anne DeClouette, Dwight Dew, Elizabeth Pogue and Clint Wilson
Standards play a critical role in our lives every day. Without standards, quality would
suffer, safety would be jeopardized, and efficiencies would not be realized. Organizations need
standards to communicate, and to conduct business.
To promote standardization worldwide, the International Organization for
Standardization (ISO) developed standards, so that a common international standard for
documentation of quality systems could be applied regardless of culture. ISO standards can be
adapted and applied to many different industries because of the broad construct of generically
written standards (Foster, 2004).
In 1987, ISO adopted ISO 9000 as an international standard. Ever since, business analysts
and other observers have debated whether it is an “effective” standard and worth pursuing. We
believe it is.
A Little Background
The ISO 9000 standard originated from the United Kingdom Standard BS 5750 and
focused on conformance with procedures. Subsequent revisions in 1994 emphasized quality
assurance, and the 2000 version brought the concept of process management to the forefront. The
ISO considered ISO 9000 so effective, it “embarked on developing an international standard for
environmental compliance called ISO 14000” (Foster, 2004, 92).
As of December 31, 2006, ISO had developed 16,455 international standards in nine
sectors based on the International Classification for Standards (ICS). The standards represent a
total output of 620,768 pages. The technical sectors include:
1. Generalities, infrastructures and sciences
2. Health, safety and environment
3. Engineering technologies
4. Electronics, information technology and telecommunications
5. Transport and distribution of goods
6. Agriculture and food technology
7. Materials technologies
8. Construction
9. Special technologies
(ISO Figures, 2007).
ISO 9000 is built on eight quality management principles:
1. Customer focus
2. Leadership
3. Involvement of people
4. Process approach
5. System approach to management
6. Continual improvement
2
7. Factual approach to decision making
8. Mutually beneficial supplier relationships
(ISO 9000 Basics, 2007).
These principles are used by leaders to guide organizations toward improved
performance.
The benefits of ISO 9000 are not confined to the business sector alone, but benefit society
as a whole, including customers, governments, trade officials, developing countries, consumers,
and the environment. Standardization allows businesses the opportunity to compete in markets
around the world. This enables more competition, which results in more choices for customers.
Standards also help developing countries compete in international markets without investing
scarce resources on research and development. Consumers benefit from products or services
consistently manufactured to agreed-upon levels of safety and quality. And the environment
benefits through the establishment of controls to insure the quality of air, water, soil, and
emissions (ISO 9000 Basics, 2007).
ISO: A Broad Look at its Importance
The most general justification for ISO is the fact that it is an internationally developed set
of standards (Nelson and Daniels, 2007). This indicates broad inputs and applications suitable for
enterprises across the globe. The standards are rigid by nature, given the long consensus process
needed to create or modify them. With the increasing globalization of world markets,
international standards become more appropriate. Rao, Ragu-Nathan, and Solis (1997) noted the
increased global interest a decade ago. Martínez-Costa and Martínez-Lorente (2003), who
3
focused on Spanish companies, more recently noted the global nature of certifications and
growth in registrations is becoming increasingly non-European. And Quazi et al. (2002)
recognized the same trend in increasing registrations by Asian companies.
The process for becoming certified is long, and requires total introspection on the part of
the applicant. Companies are required to comprehensively document, and strictly comply with,
the quality system in place (Reiman and Henry, 1996; Quazi et al., 2002). Therefore, the focus of
becoming registered is to assure the organization’s internal conformity with its own documented
procedures.
The beauty of the ISO 9000 concept is its objectivity. The registration process culminates
in a third-party audit of international standards that lends credibility to the certification. An
independent organization, called a registrar, measures the company against the ISO 9000
standard that is accepted globally as the defining set of quality management system
requirements. As a result, what could otherwise be viewed as a self-serving marketing claim
becomes a third-party endorsement that is respected in the marketplace as being totally objective.
This independent evaluation assures existing and respective customers that an effective quality
management system is in place (Hutchins, 1997).
What Scholars Say
Some scholars (McAdam and McKeown, 1999; Martínez-Costa and Martínez-Lorente,
2003) have suggested that the motivations for implementing ISO 9000 are an important factor in
effectiveness. Externally driven ISO 9000 pursuits are frequently done as a requirement for
getting business. When initiated internally, however, rather than as a response to external
pressures, companies tend to view ISO 9000 registration as just the beginning of a quality
4
journey (McAdam and McKeown, 1999; Renuka and Venkateshwara, 2006). Seeing ISO
certification as a beginning is consistent with the observation by Rao et al. (1997) that other
nationally and internationally recognized standards, such as BSI, Kitermark, and Underwriters
Laboratories, use ISO 9000 as a baseline requirement. ISO 9000 is therefore effective because it
serves can be a foundation for other certifications.
Quazi et al. (2002) noted that proponents of ISO 9000 certification cite benefits such as
“having the ability to improve product or service quality, efficiency and productivity, customer
confidence, and competitive advantage” as well as “better control of business, increased
sales/business, reduced costs, increased productivity and fewer customer complaints” (p. 54).
McAdam and McKeown (1999) similarly stressed better control, lower costs, and fewer
customer complaints. Elmuti and Kathawala (1997, as cited in Renuka and Venkateshwara,
2006) echoed the theme of higher productivity and asserted that ISO 9000 certification sparks
increased export sales as well. Rao et al. (1997) concurred, and also discussed “consistency” as a
benefit, and highlighted the comprehensive nature of the standards, which cover everything from
initial product design to post-delivery customer service. Quazi and Padibjo (1998, as cited in
Renuka and Venkateshwara, 2006) reported other, more intrinsic effects of certification, such as
“improved quality of work life … improved company image and competitiveness in the
marketplace, streamlined procedures and documentation; and increased consciousness for
preventive and corrective actions” (p. 45).
Chow-Chua, Goh and Wan (2003) noted that most companies have experienced an
increase in overall sales after ISO 9000 certification. They further noted that ISO 9000-certified
companies attained better rates of return and the additional benefits of better documentation,
5
greater quality awareness among employees, better internal communication, and an increase in
operational awareness. All of these factors sharpen a company’s competitive edge.
ISO 9000 certification allows a company to have better internal processes through clearer
working procedures, better bottom line profitability, and stronger exports from expansion into
international markets. Fuller & Vertinsky (2006) reached a similar conclusion that ISO 9000certified companies engaged in software engineering achieved increased profitability.
Effectiveness Based on Size
There’s a well-documented difference in ISO 9000 certification benefits reaped by small
and large companies (McAdam and McKeown, 1999; Martínez-Costa and Martínez-Lorente,
2003; Renuka and Venkateshwara, 2006). Large companies, for example, tend to enjoy a boost
in stock price upon announcing they are pursuing certification. The marketplace believes that
such an announcement is a harbinger of improved future revenues for the companies involved
due to improved quality, which leads to reduced fixed costs, reduced variable-support costs that
increase as sales volume increases, and increased revenues from sales. (Fuller & Vertinsky,
2006).
Smaller companies are less likely to automatically reap these benefits. It’s more difficult
for customers in the business-to-business market to ascertain if a small company is well-run. But
while smaller companies may not get the automatic bioost in status from ISO 9000 certfifiation
enjoyed by larger companies, they can still leverage certifrication to prove to the world they have
greater control of their business. Renuka and Venkateshwara (2006) specifically cited benefits to
small companies which have achieved certification: They were more technologically advanced
6
than their peers, and were more likely to have implemented standard training/development and
human resource management practices.
“Standing Out” While Conforming
While standardization is important for companies, so is product differentiation — making
a product that stands out from the crowd. While external standards, such as those described by
ISO 9000, are rigid, internal company standards need to be flexible and dynamic. Companies
that are most successful at creating and sustaining competitive advantage are those that maintain
continuously renewing internal standards.
But it’s not enough merely to have these advantages: Companies must communicate their
advantages to other businesses, or the company will not prosper. Standardization through the
ISO certification process allows an organization to communicate with other businesses, through
a “common language,” even as its own internal processes are changing.
Improvements Across The Board
Ultimately, results are what matter. Does being ISO 9000-certified actually result in
improved product quality? Rao, et al. (1997) studied companies in four countries to test the link
between ISO 9000 registration and quality; the study found that certified companies had
significantly higher scores on measures of the eight quality constructs: leadership, information
and analysis, strategic quality planning, human resource development, quality assurance, supplier
relationships, customer orientation, and quality results.
Our Conclusion: ISO 9000 is Effective
7
For these reasons, we conclude that ISO 9000 appears to be an effective means of
identifying companies that truly embrace quality standards.
***
References:
1. Chow-Chua. C., Goh, M., & Wan, T. (2003). Does ISO 9000 certification improve
business performance? The International Journal of Quality & Reliability Management,
20(8/9), 936-953.
2. Conti, T. (2004). From infancy to maturity: Rethinking the role of ISO 9000 standards.
TQM, and business excellence models, Quality Congress, 58, 1-7.
3. Foster, S. (2004). Managing quality: An integrative approach (2nd ed.). Upper Saddle
River, New Jersey: Prentice Hall.
4. Fuller, G., & Vertinsky, I. (2006). Market response to ISO 9000 certification of software
engineering processes, International Journal of IT Standards and Standardization
Research, 4(2), 43-54.
5. Hutchins, G. (1997). ISO 9000: A comprehensive guide to registration, audit guidelines
and successful certification. New York: John Wiley & Sons, Inc.
6. ISO 9000 Basics. (2007). In ISO 9000: Understand the basics. Retrieved from the Web
site of the International Organization for Standardization:
http://www.iso.org/iso/en/iso9000-14000/understand/qmp.html
7. ISO Figures. (2007). In ISO in Figures. Retrieved from the Web site of the International
Organization for Standardization:
http://www.iso.org/iso/en/aboutiso/isoinfigures/January2007-p4.html
8
8. Martínez-Costa, M., & Martínez-Lorente, A. (2003). Effects of ISO 9000 certification on
firms’ performance: a vision from the market. Total Quality Management & Business
Excellence, 14(10), 1179 -1191.
9. McAdam, R., & McKeown, M. (1999). Life after ISO 9000: An analysis of the impact of
ISO 9000 and total quality management on small businesses in Northern Ireland. Total
Quality Management, 10(2), 229-241.
10. Nelsen, D., Daniels, S.E. (2007). Quality glossary. Quality Progress, 40(6), 39-59.
11. Quazi, H., Hong, C., & Meng, C. (2002). Impact of ISO 9000 certification on quality
management practices: A comparative study. Total Quality Management, 13(1), 53-67.
12. Rao, S., Ragu-Nathan, T., & Solis, L. (1997). Does ISO 9000 have an effect on quality
management practices? An international empirical study. Total Quality Management,
8(6), 333-346.
13. Reiman, C., & Hertz, H. (1996). The Baldrige Award and ISO 9000 registration
compared. Journal for Quality & Participation, 19(1), 12-19.
14. Renuka, S.D., Venkateshwara, B.A. (2006). A comparative study of human resource
management practices and advanced technology adoption of SMEs with and without ISO
certification. Singapore Management Review, 28(1), 41-61.
9
ISO 9000: An Ineffective Quality System
by Chris Heffner, Steven C. “Swede” Larson, Barney “Tim” Lowder and Patti Stites
ISO 9000 was created as a family of models in 1987, based on a wartime British
manufacturing standard, as the answer to perceived manufacturing problems with quality and
safety. The program was originally published in 1987 by the International Organization for
Standardization (ISO), which is a specialized international agency that focuses on the
standardization of organizational processes. The organization is composed of standards from
organizations representing 90 countries. ISO 9000 was quickly adopted as the premier standard
to ensure uniform manufacturing and auditing processes. The program went through a major
revision in 2000 and now includes ISO 9000:2000 (definitions), ISO 9001:2000 (requirements)
and ISO 9004:2000 (continuous improvement).
But even after these major revisions, the program is often criticized as ineffective for a
wide variety of reasons. We agree.
Overemphasis on Inspection
First, many researchers believe ISO 9000 is ineffective because it is based on
conservatism, overemphasizes inspections and audits, and fails to encourage real improvement.
Barnes (2000), for example, said that the current commercial certification process results in a
“pursuit of quality certificates, as opposed to a pursuit of quality.” Johannsen (1995) also
asserted that the ISO concept does not incorporate the advances of Total Quality Management
because it is “narrow, static and emphasize[s] conformance to specifications” (p. 234). After
overseeing more than 50 ISO registrations, Bill Robinson (cited in Clifford, 2005), argued that
ISO is not one of the better systems that can be used for process improvement. Clifford (2005)
added that the ISO certification program can assist in raising a company’s quality, but because of
the stringent regulations and specifications, the processes eventually stifle long-run quality
improvement. Quazi, Hong, and Meng (2002) agreed that the focus on standardization reduces
creativity and continuous quality improvement efforts.
In other words, a plateau of quality can be reached through certification, but this plateau
cannot be surpassed. Karon (1996). Quazi, Hong, and Meng (2002) also supported the premise
that the ISO program is not designed as a quality-enhancement program, and has not
significantly improved the quality of products and services in firms where it has been
implemented.
Questions of Safety
Significant evidence also exists that implementation of ISO 9000 does not maintain
quality, or even safety, for the customer. Chinese companies lead the world in ISO 9000
certifications (ISO Survey of Certifications, 2005, cited in Smith, 2007), and held more than
three times as many certifications as U.S. firms in 2007. Yet Chinese companies have frequently
made headlines due to dangerous pet food, lead-based paint on children’s toys, improperly fed
fish exported for consumption, poisoned toothpaste, cancer-causing ducks, and tainted cough
syrup, to cite only a few examples (Bristow, M, 2007). Chinese companies are also known for
2
producing very cheap, low-quality products for export throughout the world. The correlation here
seems to be pointing in the wrong direction and does not serve the ISO 9000 initiative well.
Another event that casts ISO 9000 in a bad light: the notorious Bridgestone/Firestone tire
case, in which tire treads separated from sidewalls, causing rollovers in Ford Explorers (Daniels,
Arter, Bajaria, & Ono, 2000). Both Bridgestone and Firestone were ISO and QS 9000 certified.
These quality programs failed to prevent these tragedies, ostensibly, because ISO 9000 is
focused on being a quality audit program, and doesn’t look for field failures or failures in design,
which is where many quality issues reside (Daniels et al., 2000). In short, internal audit scopes
such as those performed by ISO auditors have limited reach and value, and this results in
products passing quality requirements but later failing when used by real-world customers. Many
product designs do not factor in human behavior, which leads to many quality problems that ISO
9000 cannot detect or improve (Daniels et al., p. 39).
“Not a True Quality Program”
According to Krajewski and Ritzman (1999), ISO 9000 is a set of standards governing
the documentation of a quality program, not a true quality program as many organizations are led
to believe. An effective quality program should be able to detect quality issues in products, and
ensure the safety of consumers that use the products. Simply put, ISO 9000 does not. These
empirical findings are significant because ISO 9000 certification is highly dependent on
documentation that focuses on internal and external audits. If an organization’s ability to
document, monitor, and enforce certification guidelines can be called into question, the entire
quality program becomes suspect.
3
Skrabec, Jr., Nathan, Rao and Bhatt (1997) demonstrated, based on a Dun and Bradstreet
survey, that the only true internal benefits afforded by ISO 9000 were quality awareness, better
documentation, and enhanced communications. External benefits – such as improved perceived
quality, improved competitive advantage, and reduced quality audits – were not realized in the
study (Skrabec Jr., Ragu-Nathan, Rao, & Bhatt, 1997).
Administration and Control
Another major grouping of complaints about ISO 9000 concerns the extensive
administration, control, and recording requirements. Johannsen (1995) documented claims that
the technically written manufacturing standards “straitjacket” the information sectors, drain
creativity and motivation to embrace quality from employees charged with the responsibility,
and create an illusion that the standards will “act as a barrier” to the achievement of quality
standards and customer satisfaction in these sectors (p. 232). Johannsen said the ISO 9000
standard was better-suited to industrial manufacturing than, for example, to professional services.
That because ISO 9000 is focused on routine tasks and programmed activities, as opposed to
fields where considerable skill and complex judgment are required.
According to Boiral (2003), conformance with the standard takes on a ceremonial and
mythical aspect. This ceremonial aspect, with a goal of projecting a rational and institutionally
approved image, was particularly visible during certification audits: The company’s motivation
often was the ISO certificate, rather than the systematic improvement of company practices. The
documentation required by ISO 9000, the statements, and accompanying publicity were, hence,
part of rhetoric and language games, with symbolic than practical value.
4
What’s more, ISO 9000 is not inflexible, and according to Moatazed-Keivani, GhanbariParsa, and Kagaya (1999), the standard can be extensively rewritten, greatly varying the
scheduling and detail of audits in order to reduce detail and paperwork. This leads to some
concern about the universal applicability of the standard with regards to quality and safety, as a
result of this unique customizability. According to Moatazed-Keivani et al. (1999), the greatest
potential failure, though, is in the standard’s broad nature and potential for misinterpretation.
Required for Basic Survival
Many of the world’s largest organizations, including many branches of the U.S.
government, require ISO certification (Clifford, 2005; Karon, 1996; Valenti, 1993). Thus, the
incentive to conform to the certification process, for many companies, is not increased
profitability or long-term, continuous improvement, but rather basic survival. Karapetrovic,
Rajamani, and Willborn (1997) documented that the standard is not friendly to small businesses,
and that those businesses mostly participated in the standard or adopted portions of the standard
because they were coerced by their large corporate customers, or because they needed to move
into the global market to remain competitive. The authors also pointed out several additional
obstacles confronting small businesses, including inadequate funding available to implement
these programs, lack of human resources to administer the programs, lack of knowledge and/or
training, too much paperwork, and prohibitive costs that might never be justified.
Tsiotras and Gotsamani (1996) added that selecting a registrar can be challenging; there
are numerous certification bodies available, but not all registrars are widely respected or
recognized. They added that many companies view the registration as an end in itself: Often
companies address the requirements of the standard with only the minimum amount of effort
5
required and never really realize the full benefits. These companies seek registration for
“registration’s sake,” not for the right reasons.
Barnes (2000) stated that certification can be expensive as well. While costs vary
depending on the size of the company, the number and types of products and the existing quality
management system, the average cost of certification was $245,200. Wayhan, Kirche, and
Khumawala (2002) said further that ISO 9000 certification has very little impact on financial
performance, and that any financial impact actually dissipates over time.
Employee and Customer Impacts
Despite the major revision to ISO 9000 in 2000, there are still many observations in the
literature of continued employee and customer impacts. Mezher, Ajam, and Shehab (2004)
researched and verified that the extensive 2000 update to the ISO 9000 standard did result in
some improvements for Lebanese firms that had already implemented the 1994 version, for
example, but found that employees had even less control or participation in decision-making,
adversely impacting organizational learning and employee motivation. They also observed that
there were still several customer satisfaction criteria that were not addressed. Boiral (2003)
conducted extensive interviews and found highly contrasting attitudes that were frequently
critical of the ISO 9000 system, which was often given only superficial support.
Through a qualitative analysis of the data, Boiral identifed three types of respondents,
grouped according to their opinions and attitudes about the implementation of this standard:
ceremonial integrators, quality enthusiasts, and dissidents (p. 720). Ceremonial integrators most
closely resembled those individuals and firms coerced by either circumstance or relationship to
implement the ISO 9000 standard. Quality enthusiasts’ responses reflected management
6
“rhetoric of success” about the implementation of total quality programs, a trait not shared by the
other respondent categories. Dissident responses were anti-control, anti-standardization, and
against programs that removed employee participation in process. Boiral’s research project
contributes to a better understanding of how institutional pressures create “isomorphic”
organizations, by leading them to adopt identical management models in the name of rationality,
control, quality, and safety.
Relationship with Quality Award Programs
The ISO 9000 standard does not relate well to quality awards around the world.
Ghobadian and Woo (1996) compared and highlighted four major quality awards: the Deming
Application Prize, the European Quality Award, the Malcolm Baldrige National Quality Award,
and the Australian Quality Award. Each of these awards provides a framework for evaluating
management practice, including the deployment of quality plans. The awards provide a
framework for implementing quality programs, an area that has been identified empirically as
one of the struggles for some companies that are ISO 9000-certified (Chow-Chua et al., 2003).
However Ghobadian and Woo pointed out that ISO certification and the requirements for
the awards were extremely different. The certification process focuses more on audits, whereas
the award requirements focus on wider issues, such as leadership and results.
Perhaps the most interesting finding is that both certification and awards are not based on
customer satisfaction from the customer’s perspective. The customer or a consumer-like
committee does not grant certification, nor does the customer nominate organizations to receive
quality awards (applicants nominate themselves). The question becomes, then: Does the
7
organization that receives ISO certification, or receives a major award, really have satisfy
customers?
Lack of Management Support
Many researchers have emphasized that the success of any quality program depends on
the organization’s management and culture. Quantitative research on the perceived benefits of
ISO 9000, which looked at 146 organizations participated, found that firms acknowledged some
advantages of ISO 9000 certification, but that they also noted significant problems (Chow-Chua,
Goh, & Wan, 2003). This investigation provided reasonable evidence that even though
organizations with ISO certification experienced some benefits, these companies experienced
failures in establishing adequate monitoring programs, installing strict compliance systems, and
conducting regular management reviews. Other studies previously found that very few
companies ever reap the rewards of the programs, due to unsuccessful implementation (Karon,
1996; Valenti, 1993).
The ISO certification program is rigorous, demanding, complex, and time-consuming
(Dale, 2002; Valenti, 1993). Unsuccessful implementation is often the result of a lack of longterm commitment by top management, because managers underestimate the time, resources,
finances, and scope required (Bennis, 1977; Chatterjee & Yilmaz, 1993; Geri, 2005). The ISO
9000 program requirements may appear, to a manager, to be manageable in the beginning, but as
program implementation progresses, many new factors that were previously unaddressed rise to
the surface and impede progress (Rastetter, 1985; Widmer, 1979). Tsiotras and Gotsamani
(1996) went so far as to assert that the greatest reason for the failure of ISO 9000 programs is a
lack of management commitment throughout the organization.
8
Conclusion
Though ostensibly proposed and required by many firms as a quality and safety
management program, ISO 9000 has failed in many cases to achieve any long-term impact on
customer interpretation of quality, or to guarantee safety for either employees or customers. It
has similarly failed to achieve quality improvement for many firms, or the increased profitability
which has been claimed. It does not support the growing trend for rapid customization, and
seems to inhibit adaptability and response to rapid change in professional fields which require
less routinized processes and thinking. What’s more, management frequently lack