Is Iso 9000 Advantageous For Industrial Suppliers

. Essay, Research Paper

Introduction In today s business world, companies are expanding into global markets. Because of language, cultural, and governmental differences, standards have been created for smooth transitions into these markets. Standards are documented agreements containing technical specifications or other precise criteria to be used consistently as rules, guidelines, or definitions of characteristics to ensure that materials, products, processes and services are fit for their purpose.5 International Standards contribute to making life simpler, increasing reliability and effectiveness. ISO (The International Organization for Standardization), a non-governmental organization established in 1947, developed a series of standards called ISO 9000 in 1987 to ensure that companies adhere to a quality management system specification that is now the worldwide standard for doing business. The ISO 9000 Standard can be applied to any product, tangible or intangible, or a combination of both. It is equally applicable to both small and large companies, including service providers and distributors. This paper will analyze the economic, financial, and organizational system impacts of ISO 9000, and whether or not all industrial suppliers should implement the ISO 9000 Standards to ensure quality. What is ISO 9000. ISO 9000 is a certification process for companies that represent international standards for conducting business which focuses on quality assurance. The ISO 9000 Standard was written by representatives from the United States and 14 European countries.4 The requirements of the Standard are aimed primarily at achieving customer satisfaction by preventing nonconformity at all stages, from production through servicing.4 In most cases, this is the primary goal for all businesses. Some popular principles incorporated into these standards include: Total Quality Management (TQM), Just-in-time inventories (JIT), Kaizen (continuous improvement), and Lean Manufacturing. These standards ask a company to document and implement its systems for quality management; and then to verify, by means of an audit, conducted by themselves or an independent accredited third party, the compliance of those systems to the requirements of the standards.2 Currently, the ISO 9000 series is comprised of the following international standards: ISO 9000 – Guidelines for selection and use ISO 9001 – Model for quality assurance: design, development, production, installation, and servicing ISO 9002 – Model for quality assurance: production, installation, and servicing ISO 9003 – Model for quality assurance: final inspection and test ISO 9004 – Quality management and quality system elements ISO 9001, 9002, and 9003 are requirement standards while the rest are guidelines. These mandatory standards dictate what a company will do. Companies become registered to or compliant with one of the requirement standards.13 QS 9000 is a more mature version of ISO 9000 and reflects the needs of the automotive industry. QS prescribes that specific quality planning and standard quality control techniques be in place in order to achieve certification.4 ISO 14000 is a brand new international standard, required by some suppliers, on environment management. It is based on the premise that economic development can only happen in a healthy environment.4 ISO Certification A company interested in ISO 9000 certification needs to choose a requirement standard based on its core competencies. Core competencies include communication, involvement, and a deep commitment to working across organizational boundaries. The link between identified core competencies and end products is the company s core products.10 These core products, either manufactured or resold, will conform to the company s ISO 9000 series designation. For example, an industrial supplier such as a local distributor does not need to get an ISO 9001 certification, because they do not design or produce anything. A local distributor should most likely desire an ISO 9002 certification and commit to following ISO 9000 guidelines. On the other hand, a Tier 1 automotive supplier would seek an ISO 9001 or QS 9000 certification depending on the automotive customer s preference. Companies usually initiate an ISO 9000 project due to customer demand. Supply and demand are the most fundamental and the most powerful of all economic models. ISO 9000 certification fits in the supply and demand model, because of the market pressures put on suppliers to comply with the standards. Because of the increases in the number of suppliers requiring ISO 9000 certification, the demand curve for ISO compliant suppliers has shifted outward, facilitating an overall growth in demand. The need to obtain ISO 9000, QS 9000, or ISO 14000 registration by many companies is growing daily as pressure from both customers and competitors increases.4 After determining on which requirements standards a company should base their quality system, the company needs to perform two primary tasks for certification. The first task includes the documentation of its business processes in light of the requirements of each of the applicable 20 elements of the ISO 9000 standard. These twenty elements are as follows: management responsibility; quality planning; contract review; design control; document and data control; purchasing; control of customer-supplied product; identification and traceability; process control; inspection and testing