Monday, July 11, 2011

ISO and other Standards

International Organization for Standards or “ISO” is an organization based in Switzerland that publishes standards for a variety of items.  They have published some 18,500 international standards.  There are upper level quality standards for products (ISO9001), quality standards for service (ISO9004) and for Software (ISO90003) and each of the main groups have a number of additional standards that cover a variety of individual items that are relevant to the main topic.  The most commonly used and accepted ISO standard is ISO9001, which is the standard for quality management.  In simple terms ISO9001 requires that you have a documented quality management process and that you follow it. ISO certification requires an audit to ensure that you both have a documented process and that you follow that documented process. To maintain certification annual audits are required. Both the initial audit for certification and follow on audits are not cheap.

To a Supplier an ISO9001 Certification program can be a requirement, if the customer requires certification or it can simply be a marketing tool that tells perspective Buyers that the company has a documented quality management process and that they follow that process. The value to a buyer is not a guarantee of quality, it’s a positive indication that the Supplier is trying to manage quality.  Technically you could have a documented process and be following that process and still not be producing products of consistently high quality for a variety of different reasons. One example of that would be if production was highly labor intensive where the quality could be impacted by the skills of the individuals involved or by the frequency and run length of the production. The real measure of a supplier’s quality is in the measurement of their yields at the end of the process, it’s the amount of rework that needs to be done to products to make them compliant, and it’s the measure of the product’s performance in the field as indicated by warranty return levels and reliability measurements such as Failures in time (FITS) or Mean Time Between Failures (MTBF) where you measure actual performance against the committed levels.

What do you do if a Supplier doesn’t have ISO9001 certification or may have let that certification expire because of the cost impact? If your customers are requiring that their suppliers and all their subcontractors and material supplier must have it, the lack of certification will be a problem. If you don’t have that constraint, what it means that as part of pre-qualification whoever manages quality on your team needs to do their own form of quality management review and audit to ensure that the Supplier’s processes are documented and in managing product they see evidence that the supplier is in fact managing the work in accordance with the documented processes.

ISO is another category of the many different types of standard that exist in business. You can have standards issued by national standardization organizations. The U.S. has the American National Standards Institute (ANSI). The U.K, has the British Standards Institute (BSI). Germany has Deutsches Institut fur Normung (DIN). Canada has Canadian Standards Association (CSA).
France has the Association Francaise de Normalisation (AFNOR). Japan has the Japanese Industrial Standards Committee (JIS). Standards are also created by professional societies, industry or manufacturing associations, and other international organizations such as IEC. Standards are also created by testing and safety organizations such as ASTM, IEEE, ANSI, SAE UL. Standards can apply to all phases of work from design, manufacturing, testing, quality, safety.

 Manufacturers of products are most concerned with two types of standards when it comes to selling. The first is complying with applicable country standards. That’s important as failing to comply with applicable country standards may prevent sales and import of products into that country that don’t comply. The second concern is safety standards. The courts frequently accept safety standards as recommended practice. If you fail to comply with a safety standard a lawyer for the plaintiff would argue that you were negligent because you failed to comply with recommended practice. To avoid that companies may use and agency like Underwriters Laboratories (UL) ratings. For their services Underwriters Laboratories has different classes of ratings with the lowest being UL Listed and the highest being UL Certified. A U.L. certification is used to both market the safety of the product and it’s also to prove that manufacturer complied with recommended practice in their argument that they weren’t negligent.