In this external element of the WITORG Guide, we will reflect on the influence of quality systems, management systems or quality management systems in organizational systems.
It is not intended to deepen into the detailed knowledge about the requirements of standards or quality systems. The main intention is to reflect on how they are implemented and if it is possible to draw conclusions, with the aim of providing ideas for a positive evolution of an organizational system, management system, quality system or quality management system. From now on, we will generally call them ‘management systems’.
Many people are related to management systems when working or collaborating in organizations where they have already been implemented. Usually, anyone working in an organization with a formal management system will interact with it in one way or another.
To begin with, some concepts will be presented on which the reader may perform some internet searches. From these concepts, you can quickly review the origin and evolution of management systems and their history. In this way, the content of this chapter can be understood in a more profound way:
- The main quality systems.
- Origin of ISO standards.
- History of ISO standards.
- What does the acronym ISO mean?
- The eight principles of quality management.
- The seven principles of quality management according to ISO 9001: 2015.
As we can see in the scheme of the WITORG Guide, these quality systems models, or management systems, are within external element B. The reason for classifying these systems as an external element to an organization is that the organizations, after being created at a moment in time and for various reasons, decide to apply to their organizational system the requirements and considerations of a standard, quality model or management model. Once the organization prepares for it, the certification can be obtained.
An organization is usually certified in a quality standard or system for several reasons:
- A client’s requirement to be able to keep commercial relations.
- To enter a new sector.
- The need to improve the organizational system.
Two organizations certified in the same standard can have completely different approaches in terms of their management systems, fulfilling both the requirements. This fact is what leads the WITORG Guide to classify referential management standards or systems in the market as external elements of the guide (‘B.-Quality Systems’) to the organizational systems. The standard in general usually includes requirements to accomplish, but how to do it depends on each organization. Even if an organization is based on a standard, as an influence or external reference, how it does so depends on itself.
Once the requirements of a standard have been met on the one hand, and how to do it on the other, an organization’s own management system will have been created.
Evolution of the ISO 9000 standard and derivatives
The ISO organization is recognized as the reference entity for the international standardization of very varied subjects. The different subjects or topics are managed by specific committees organized by theme.
The main standards in relation to quality systems and within the ISO organization are in the ISO 9000 family of standards.
Quality systems or management systems have undoubtedly helped organizations to a positive evolution of their organizational systems. Today, the presence of an organization in certain sectors requires certification in any of the standards, otherwise it is not suitable to operate in this sector, although there are always some exceptions.
Thanks to the family of ISO 9000 standards, a common jargon and a way of understanding organizational systems has been created by a huge group of organizations operating in various sectors. This greatly simplifies the communication in an organization, both internally, and in the relationship with suppliers, customers, collaborators, etc.
However, we cannot forget that the ISO organization was created for the normalization of many elements, including the ISO 9000 family, a long time ago. The ISO 9000 standard and derivatives, started from an approach to the control of production processes, supervising their output and deciding which part of it was within acceptable requirements to be delivered to another manufacturing process or to a customer. The evolution of ISO standard, 9000, based on the control of manufacturing processes, resulted in ISO 9001 and its eight principles of quality management, back in 2000. They are:
- Principle 1: Customer focus.
- Principle 2: Leadership
- Principle 3: Involvement of people.
- Principle 4: Process-based approach.
- Principle 5: A systematic approach to management
- Principle 6: Continuous improvement.
- Principle 7: Factual approach to decision making.
- Principle 8: Mutually beneficial supplier relationship.
In the latest ISO 9001: 2015 revision, the eight principles became seven:
- Principle 1: Customer focus.
- Principle 2: Leadership.
- Principle 3: Involvement of people.
- Principle 4: Process-based approach.
- Principle 5: Improvement.
- Principle 6: Decision making based on evidence.
- Principle 7: Relationship management.
As it can be seen, the evolution of quality systems, from its approach based on the quality control of the products to be delivered from the previous millennium, to the seven principles of ISO 9001: 2015, has been considerable. In its origin, it was a quality control system; at present, its principles include the considerations and requirements to be included in an organizational system. Evolving to some general principles may have meant forgetting its initial concept of production control, to find itself nowadays wanting to cover a lot, forgetting to some extent the product and process, where it was originally.
For example, in the car industry, tier1 suppliers are those that supply components or assemblies to vehicle assembly plants. These suppliers require IATF 16949 certification, previously ISO 16949, this being a derivation of ISO 9001 and other standards for the car industry. Now, the assembly companies, because the certification in ISO 9001 and IATF 16949 does not guarantee an optimal management of the production plants of their suppliers, ask them to be certified in turn in QSB +, PSA case and GM. Process VDA audits mainly in the German automotive world. Other manufacturers carry out audits of their own process or product to evaluate the production systems of their suppliers, given the evidence that having an ISO certification and derivatives does not guarantee a minimum when managing the production plants, where they receive the goods from.
On the other hand, it is observed everywhere that already certified companies are far from the seven principles for quality management. It is said that quality is not a destination, but a journey. This must be the reason for observing certified organizations even in less advanced states of the seven or eight principles of quality. Clear examples are:
- Process management versus organizations whose departments are management processes.
- Customer orientation is not palpable except in commercial departments.
- The orientation towards continuous improvement is fulfilled as a requirement, showing three or four documented examples at the last minute. There is no formal system of improvement or establishment of culture of continuous improvement in organizations.
In the last three decades, the technological advance has been evident; however, the advance in the seven or eight principles of quality seems to be something complex, when organizations are observed where their organizational systems do not evolve at the same pace as the technological ones. In fact, the requirements regarding ICT systems have been lax. Until the IATF 16949 (2017-2018) there have been no specific product requirements that contained ICT.
With the new version of ISO 16949, called IATF 16949, the ISO organization aims to make a quantum leap. IATF 16949 introduces new requirements or approaches such as risk analysis in an organization and its environment, contingency plans and products with software. In the courses for the transition from IATF 16949 to IATF 16949, the importance of process management is also emphasized. However, there are still no simple answers to the following questions:
- Do the management process maps still show functions or departments such as management processes in organizations with a marked Taylorist influence?
- For the introduction of the new approaches and requirements of IATF 16949, are the current management processes in an organization sufficient?
- By introducing the new requirements into the current management processes, is the standard met?
- Should new management processes be designed to be able to introduce the new IATF 16949 requirements?
- What is the reason why ISO 9001 and IATF 16949 courses are mainly attended by people related to the quality function or the quality departments?
The quality standards originated to control the quality of products and services created by an organization. The transitions and revisions ISO 9001, IATF 16949 and IATF 16949 have included new requirements up to their current status. This difference from their origin is due to the progressive introduction time of new principles and requirements, concepts increasingly difficult to narrow again.
‘Quality professionals’ must respond to increasingly abstract notions within the new principles or requirements of the standards. Many of them, related to the implementation of the standards within the organizations, they look for formats or recipes that can be shown as proof for the fulfilment of the new requirements. And all this without having understood the seven or eight principles of quality enunciated.
Quality departments were valid to manage the quality standards with the product control approach from the previous millennium. Since 1990, when quality standards began to evolve towards management systems, quality departments, in many cases, have been responsible for implementing them. And today, it remains the same despite the great change in the technological world in the approach of the management systems or quality systems. However, questions arise such as, how have the quality departments evolved? Why is it that most of the students of the IATF 16949 courses are from the quality department?
To contrast what was stated in the previous paragraph, WITORG continues to focus on the fact that without ‘real’ management processes, in a process map, it will be difficult to focus on continuous improvement, or on customer focus as core management principles in any management system.
Despite these reflections, there is no doubt about the good incorporated into the organizational world by the family of ISO 9000 standards and their derivatives. WITORG agrees with the principles of a quality system, as they define WHAT an organizational system must contain and are intended to reflect on HOW they are introduced in an organizational system.
Reflections on the quality principles
A few reflections on the quality principles to bring together the important relationship between some of them. The objective is to understand the difficulties in accessing certain quality principles and how to bring them to reality.
I. Leadership and the approach based on management processes of quality systems
As previously mentioned, ‘B. Quality systems’ is an external element of the WITORG guide. An organization already created, will decide, at a given moment and for various reasons, to include the principles of ISO 9001 standard as a key element for its organizational system. Then, it will also decide to be certified in the standard in order to fulfil an organization’s objective, or because of a necessary requirement of a sector, client or others.
Surely, there are cases of organizations that without having been based on ISO 9001 could get certification in it, because their organizational system already meets the requirements. Even get a higher grade than another organization already certified if there was a way to compare them. Do not forget that the certification is not acquired with a score (unlike in EFQM). In ISO 9001, an organization is certified or not certified.
Two quality principles are named in the title of this section: leadership and the process-based approach. Any company certified in ISO 9001 can show an organization chart and a process map. However, in many of the certified organizations, their organizational chart will be made up of function managers, and if the management process map is followed, they will show the same functions of the organization chart, representing management processes.
We are going to analyse a process map, similar to many in reality, of a manufacturing plant for the car industry:
When a process map with functions like the one shown above is observed, the following reflections are considered:
- If the company is certified, has the auditor asked if the organization has a clear approach to process management? From WITORG, at least internal element ‘300. Process management’ moves away from a process map where the functions of an organization are present as management processes.
- What does an organization understand by an organizational system based on process management when it presents a map of processes where these are functions?
- Is there a management process for the design of management processes?
- Issues to be raised by the reader.
WITORG considers a classic Taylorist organizational chart one that is organized by functions or functional departments. The clearest example could be the general manager (CEO) in the first level and, below it, all the existing functions (administration and finance, people, commercial-marketing, engineering, purchasing, planning and logistics, manufacturing, maintenance, medium environment, security, etc.). For example:
Considering the organization chart described in the previous paragraph, and in an increasingly complex world, when there is a new organizational need, WITORG rises the following questions:
- How does the organization propose new organizational needs that include more than one function represented in the organization chart?
- Does each function know how the other functions in the organization chart work?
- Does each function know its own functioning and little about the others?
- If global knowledge of the organizational system is divided into functions and the CEO is the only one able to decide between functional needs, how does he/she lead it?
- Can a new organizational need that affects more than one function be led from a function?
- Can a function decide on changes to be made in another function, both of which are represented in the organization chart?
- When new organizational needs arise that involve more than one function shown in the organization chart, does the organization’s management system have some management process, method or system to deal with new organizational needs that involve more than one function?
- How is leadership exercised when facing new organizational needs that involve more than one function represented in the organization chart?
- If a new organizational need implies the loss of power of a function with respect to one or more, how would the leader of the losing function react?
- How would the collaborators react under the hierarchy of the function leader who loses share of power?
- Any other the reader wants to add.
WITORG affirms the following points regarding the relationship between the concepts leadership and process management:
- Leadership usually defines a person’s ability to lead a team. Leadership does not explain so often how to coordinate leadership within an organizational system. In organizations, there can often be people with capacities for leadership, whom the organizational system does not allow to use.
- In organizations with maps of management processes, where these are departmental functions, the likelihood of conflicts between function leaders tends to be greater.
- The CEO or general manager is the only possible mediator in a conflict between function leaders. He/she, given the increasing complexity of the current world, may not even understand the causes of the conflict, both for reasons of the complexity of a changing world, for lack of knowledge on the subject, for hidden reasons about power struggles, hidden personal interests…
When talking about leadership, it should not be focused only in the people’s ability to lead, but how organizational design facilitates leadership or hinders it. (In the following chapters we will deepen in the subject).
Next, a process map with a process management approach is shown regarding the definition shown in section ‘300. Process management’.
In the process map just presented, it is assumed that there is a committee formed by several people for each management process. And it is also assumed that, above those committees, is the figure of a CEO with full powers over them. With this, the reader can ask himself questions such as:
- Who is the leader of each committee?
- Is a committee a management process?
- Do all these committees have sufficient content to encompass or be defined as a management process, according to topic ‘300. Process management’?
- If there are conflicts between the functions within a management committee, who is the one who finally decides?
- Is the CEO the designer, executor and controller of all the committees?
- Could the CEO be removed from the chart-map process and leave the committees operate without him/her?
- If there is some coordination within a function, and if this function participates in more than one management process (even with different people), how is this function divided into different committees coordinated? How are conflicts that may arise due to conflicting priorities between the coordination of the function and the particular interest within a committee of that function resolved?
- Any other the reader wants to add.
To the questions asked about the example shown, each organization should look for its own answers. These answers will be found through more or less Taylorist or more or less holacratic models. It is important to note that the organizational model is to some extent independent of the requirements of a quality standard or system. This is because with two very different organizational conceptions, the requirements of quality standards can be met. Or at least now it can be done.
The question is, what organizational concept will help an organization to be more or less prepared to evolve its organizational system to adapt to changing environments and continue to survive.
II. Customer focus
This quality principle, when there is a classic Taylorist organizational chart and a map of management processes where management processes represent functions, presents serious doubts about the real focus of an organization and its organizational system towards the client.
A classic example of a Taylorist organization according to WITORG might be this:
Below, a map of management processes defined as Taylorist:
Of course, an organization usually focuses on the customer. In Taylorist organizations, the departments in contact with the client have this focus, or at least some people in these departments. The certifying auditors in a quality standard will surely find evidence and proof about the client’s focus. However, all those departments/functions that are not in contact with the client can live with their backs to them, missing opportunities for improvement that a better knowledge of the customer could bring. Is it necessary that all people are focused on the customer?
Speaking of customers and management systems, the term ‘internal customer’ became fashionable a decade ago. Starting from the basis of the importance of the ‘customer focus’, as not all people in an organization can focus directly on it, the importance of focusing also on the internal customer is raised.
From here, this question arises: do the departmental Taylorist organizations, with their maps of processes representing functions, establish easily external and internal customer relationships?
In chapter ‘A. Organizational characteristics’, the increasing complexity in a changing world is represented. The approach to understand increasingly complex current environments, is to have management processes where that focus is given to the organization’s customers. But, in addition, it is necessary that same customer focus to know the connection of the internal reality of an organization with the environment. This will have to be done through the design of management processes that rethink departmental Taylorist structures.
WITORG Guide presents the internal elements, concepts and reflections on how to make the evolution from Taylorist systems towards others less Taylorist and more holacratic in sections 200, 300, 400, 500 and 600.
III. Continuous improvement and evidence-based decision making
These two principles of the quality system based on the ISO 9000 family of standards, when we compare them with two or three decades ago, they acquire another dimension. In ISO 9000:2000 version, the principles of improvement and decision-making based on facts are already present, however, the new dimension acquired by these two principles is:
- External constraints to an organizational system in an accelerated world, with a temporary feeling, greater speed in the changes and in a wider and more complex environment, as described in ‘A. Organizational characteristics’.
- The evolution of the concept of continuous improvement, proposed in ‘200. Continuous improvement’.
Decision making based on evidence:
- The possibilities that technology offers today regarding the technological possibilities of the 1990-2000 period will be explained the post ‘Automation Pyramid and Industry 4.0.’
- The concepts developed in ‘400. KPI and targets’ regarding the possible self-learning, the interconnection of the KPIs and the level of belligerence of the KPIs. Always taking into account the information in real time.
To show in a different way the new dimensions of the principles of quality, continuous improvement and decision making based on evidence, the PDCA concept from two or three decades ago can be compared with the PDCA concept nowadays. The big differences are:
- Technological possibilities to measure KPI in real time, shared by different teams of people and with immediate reaction possibilities.
- Technological possibilities at the time of data storage (big data), for the analysis of information.
- Self-learning through the analysis of data storage (big data), clearly focused on the concept of continuous improvement.
IV. People’s involvement and relationship management
An organization will usually share a similar philosophy for these two quality principles. Establishing principles for people’s involvement within an organization will surely lead to trying to use the same principles in environmental relationships. There may be exceptions for various reasons, but generally, if an organization operates inside in a certain way, that type of relationship will be more comfortable with external agents as it is used to it.
If an organization has internally a policy of information transparency, it is easier to be willing to do the same with suppliers, customers and collaborators. This does not mean that it is always achieved. Internally, it can be transparent, however, and as an example, that transparency may not be such with a supplier, because it is not willing, at that time, to collaborate in that way.
The two previous paragraphs intend to show the need for ‘true’ values in an organization to be clear about how to state ‘people’s involvement’ and ‘relationship management’ as quality principles. The mission, vision and values stated in an organization are not always true, and even if they are, there is not always a way to take them to 100 % of the organization for various reasons.
Summary of quality systems, their principles and requirements
- Quality systems, mainly ISO 9000 family and derivatives, have their origin in the quality and control of manufacturing processes world, which emerged in the second millennium. They have evolved from their origin towards the world of management, focusing on organizational systems.
- Quality systems help create a language and ways of making common to a sector, which facilitates the relationship between organizations.
- As the origin of these systems comes from the second millennium, sometimes, although the standard has conceptually very valid principles, organizations continue to interpret them as they did in their origin, however, in the current millennium, the environment has changed.
- EFQM, ISO 9000 family and derivatives are models that support, that provide what considerations an organizational system should contemplate. However, how these considerations are introduced into an organizational system depends on each organization, so we can meet with two organizations with the same considerations and yet with very different ways of doing.
- Within the WITORG Guide, ‘B. Quality systems’ is an external element. Quality systems are guides with requirements and considerations. How to contemplate both the requirements and the considerations is something that is established within the organizational system. Therefore, the organizational system is unique and particular to each organization.
- The requirements of a standard are met from the organizational system of an organization, hence the importance of developing the internal elements of the guide 100, 200, 300, 400, 500 and 600. These developments of an organization are used for its normal operation independent to an external standard or quality system. And this is the reason why it is considered a standard in ‘B. Quality systems’ external to the organizational system. Of course, the organizational system will have to comply with the requirements of a standard, even if it is external, at least if it wants to be certified. And, in addition, it will help to create a common language with many other organizations.
- Any other the reader wants to add.