New ISO Standard a Tool for Smart Growth

Many small manufacturers are embracing the new ISO standard, ISO 9001:2000, to gain a competitive edge in markets here and abroad.

"Businesses are realizing that ISO certification isn't just something you hang on a wall," says Michael Hablewitz, a WMEP manufacturing specialist who has helped guide dozens of manufacturers through the process. "The new standard can be a powerful catalyst to help manufacturers operate more efficiently, improve product quality and increase market share."

Getting ISO registered can pay big dividends, according to a recent survey published by the American Society or Quality and the Automotive Industry Action Group. Manufacturers reported benefits of $300,000 to $10 million as a result of certification, in the form of sales increases, improved on-time delivery, reduced defects and fewer product returns.

Companies reap the biggest benefits when they combine ISO with lean or other continuous improvement strategies. The new ISO standard is focused on improving business processes. Lean tools are process-focused and provide the means to remove non-value activities from both the manufacturing and office processes.

ISO 9001:2000 went into effect Dec. 13, 2000. It replaces the old standard, ISO 9000:1994. Companies registered under the old standard have until Dec. 13, 2003 to meet the new requirements.

Companies get ISO-registered for three basic reasons. Many see it as a selling advantage in international markets because it is widely recognized by other countries. Others want to streamline business operations and enhance product quality. Or the driving force can be a customer requirement.

Hablewitz says the new standard is a vast improvement over the old because of its focus on company wide business systems as opposed to product quality alone. The new standard takes manufacturers a step beyond mere compliance. It helps them improve the efficiency of the organization, its operations and its economic performance as well as the quality of its products and services. That all adds up to a big emphasis on customer satisfaction.

"We are helping companies use the new standard to become more efficient and improve every facet of their operations - from the front office to the shop floor to the executive suite," Hablewitz says. "What's important for people to understand is that the new standard is management driven. It requires support from the top management to continually lead and appraise the system for effectiveness and continual improvement," Hablewitz said.

"This isn't a one shot deal. It's a way of life," he adds.

Flexibility is key
Hablewitz has seen ISO standards come and go in his career. What he likes about the new standard is it allows a company to be flexible in its approach to making improvements. "It's not prescriptive. It tells us what we must comply with but it doesn't tell us how."

Hablewitz advises companies to take an approach tailored to the needs of their business. Companies should be putting in this system to achieve certain benefits, such as lower costs, higher productivity, or increased sales, he said. WMEP follows a four-step process when guiding a company through the ISO process. The steps are: training; self-assessment (GAP) analysis and implementation plan; implementation; and receiving the registrar's certification. The process takes six months to a year to complete, depending on the nature of the business.

The standard's five major requirements are: quality management system documentation; management responsibility; resource management; product realization; measurement; and analysis and improvement.

ISO BENEFITS

Process/quality improvements
Better understanding of jobs/tasks
Reduced PPM defects
Fewer parts returned
Improved on-time delivery
Increased sales and market share
Increased productivity

The Process

STEP 1
Form quality team. Identify training requirements and resources.

STEP 2
Conduct self-assessment (GAP) analysis. Identify team member responsibilities.

STEP 3
Streamline business processes. Identify and select third party registrar.

STEP 4
Review registrar's audit. Identify additional areas for training and continuous improvement.

© Copyright 2003 by WMEP.org

WMEP provides technical expertise and hands-on implementation assistance to small and midsize manufacturing firms on advanced manufacturing technologies and business practices includinglean manufacturing, ISO, value chain management, and strategic repositioning services for manufacturers and manufacturing facilities located in Wisconsin.