Essay by: Mike Shesterkin, Exec. Director
In this week’s article, we’ll continue our exploration of the business as a system and what we can learn along the way from the International Standards Organization (ISO).
In last week’s article, we established a fundamental understanding of quality as having to do with the gap between what’s expected and what is. This week, we’ll look at the term “quality management” and what it implies regarding managing these gaps. For now, we’ll be leaving the notion of what’s expected (i.e., the ideal, or aspiration) for another article. Understanding what’s expected, as it applies to sustainable business (SB), necessitates what many call stakeholder engagement and all that goes with the term. Stakeholder engagement can, in some respects, be considered a principle; however, we’ll treat it as more of a tool or technique and return to it later. At this point, we’re still exploring principles or the foundations on which SB leadership rests.
Before we go further in our exploration of the ISO9001 management systems requirements standard, it may be worth considering its applicability.
Many of us who live, work, and play in SE Michigan – wherein our economy has been dominated by the automotive industry – think of ISO9001 as being something that only applies to large, multinational corporations. This is not the case. According to the ISO’s website, 9001 is applicable to “…any organization, large or small, regardless of its field of activity.” Considering the folks who write standards are very careful with language, we can interpret these words exactly as written: We can count on the ISO9001 standard to be applicable to “any organization.”
When the ISO9001 standard was first issued in 1987 (ISO9001:1987), it was interpreted in a way that did not take into account the critical role management, and more importantly, leadership plays in how the business performs. While it ought to be brutally obvious the business’s leadership is responsible for the business’s performance, the 1987 version did not explicitly address this reality. This fact, combined with how the standard was foisted on businesses down the supply chain, led to some dysfunctional behavior.
Ultimately, the objective of the standard is to provide the customer (i.e., the entity purchasing the product or service) with assurance that purchased products or services conform to expectations. Quality management systems that meet certain minimum requirements, such as those issued by the ISO, are intended to give the customer this sort of assurance; this is why the standard was developed.
When ISO9001 was first issued, many businesses at the top of the supply chain simply mandated their suppliers conform to the standard, or lose business. There’s a general rule about coercion: It’s anyone’s guess what will happen after it’s been applied. The result of this particular coercive tactic was that many business leaders and managers simply abdicated their responsibility for the quality management system – the thing that’s foundational to the business’s performance – to the folks in the “quality department”.
In this sort of environment, we could imagine the following scenario:
The top executive of the fictious ABC Corporation is quietly practicing his putting in the confines of his mahogany lined office, when suddenly there’s a knock at the door.
“Who is it?”, the executive calls. “It’s Mike from quality”, comes the reply. The executive responds, “I’m busy. Can it wait?” Mike replies, “I don’t think so.”
Mike then enters the office and explains to the executive that ABC’s largest customer is requiring conformance to ISO9001, and if ABC does not meet the requirement, it will lose the customer’s business. The executive, who’s returned his putter to its rightful place, looks at his watch and realizes his tee time is fast approaching, which means he must dispense with this particular interruption as soon as possible.
The executive then does what he thinks is his job: He explains to Mike the quality manager’s job, which is to manage quality, and if Mike can’t do his job, he’ll find someone who can. The meeting ends and the executive goes about the important work of his day, which is improving his golf game.
To be sure, this story is a caricature; however, we cannot deny the reality at which it strikes. For the non-systems thinking business leader, quality, and all that we’ve established goes with this word, is something managed by others; it has little or nothing to do with running the business. This sort of thinking has certainly changed over the years, and much progress has been made. Yet, thinking of the business as a system, and establishing the leadership principles that lead to such thinking, is a realm filled with opportunity.
In later articles, we’ll dig deeper into the improvements that have been made to the ISO9001 standard since 1987, and how these improvements apply to the management of the business.