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MGT510 - Total Quality Management - Lecture Handout 27

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ISO 9001(2000) QMS (CLAUSE # 8) MEASUREMENT, ANALYSIS, AND IMPROVEMENT

ISO 9001:2000 - Quality management systems - Requirements
8 Measurement, analysis and improvement
8.1 General

The organization shall plan and implement the monitoring, measurement, analysis and improvement processes needed:

  1. To demonstrate conformity of the product,
  2. To ensure conformity of the quality management system, and
  3. To continually improve the effectiveness of the quality management system.

This shall include determination of applicable methods, including statistical techniques, and the extent of their use.

8.1 General guidance
Introduction

An organization should provide for the measurement and evaluation of its product, the capability of processes, customer satisfaction and items required by other interested parties at appropriate intervals. This includes the recording, collecting, analyzing, summarizing and communication of relevant data needed to monitor and improve the organization's performance.

Measurements should be evaluated in terms of the added value provided to the organization, and should be deployed only where the benefit can be identified. The measurement criteria and objectives should be identified. These measurements should lead to consideration of appropriate action. They should not be purely for the accumulation of information.

The results of measurement can show a level of achievement, but consideration should also be given to trends and variation. The causes of trends and variation should be identified in order to ensure they are understood. The organization should determine the need for the use of statistical techniques for analyzing data, including verifying process operations and product characteristics. Statistical techniques selected for use should be suitable for the application. The organization should control and monitor the use of the statistical techniques selected.

The results of analysis of data from improvement activities should be one of the inputs to the management review process. The information and data collected should be used throughout the organization to support effective and efficient management.

The organization should promote the use of creative and innovative approaches for improvement processes. Also, the organization should plan the implementation of the improvement action and provide adequate resources. The organization should continually monitor and record the implementation of improvement actions, which will also provide data for future improvements. Relevant comparative data and information should be used to set realistic and challenging goals.

Continual improvement requires change within the organization. Evaluation of change requires measurement. Measurement itself does not initiate change. Measurements should be taken for a clearly defined purpose.

Issues to be considered

Measurement, analysis and improvement include issues such as the following:

  1. Measurement, analysis and improvement should be used to establish appropriate priorities for the organization;
  2. The measurements employed by the organization should be reviewed periodically, and data should be verified on a continuum (basis for accuracy and completeness;
  3. The benchmarking of individual processes as well as customer satisfaction should be employed as .an improvement tool;
  4. The use of measurements and the generation of information are essential for good communication and they should be the basis for improvement and involvement of all interested parties; such information should be current, and be clearly defined as to its purpose;
  5. Appropriate tools for the communication of information resulting from the analyses of the measurements should be implemented;
  6. The effectiveness of communication to interested par1ies should be measured to determine whether the information is clearly understood;
  7. Self-assessment should be considered on a periodic basis to assess organizational performance and to define improvement Opportunities.

ISO 9001:2000 - Quality management systems - Requirements
8.2 Monitoring and measurement
8.2.1 Customer satisfaction

As one of the measurements of the performance of the quality management system, the organization shall monitor information relating to customer perception as to whether the organization has met customer requirements. The methods for obtaining and using this information shall be determined.

8.2 Measurement and monitoring
8.2.1 Measurement and monitoring of system performance
General

The organization should identify the methodologies needed for identification of areas for improvement in the overall efficiency and effectiveness of the quality management system. Examples of measurement and monitoring methodologies include customer satisfaction measurement:

  • Internals audits,
  • Financial measurements, and
  • Self-assessment methodologies.

8.2.1 Measurement and monitoring of customer satisfaction

The organization should recognize that there are many sources of customer-related information, arid should establish processes to gather analyze and deploy this information. The organization should identify sources of customer and end-user information available in written and verbal forms, from internal and external sources. Examples of customer- related information include:

  • Feedback on all aspects of product,
  • Customer requirements and contract information, .market needs,
  • Service delivery data, and
  • Information relating to competition.

The organization's process for requesting, measuring and monitoring feedback of customer satisfaction and dissatisfaction should provide information on a continual basis. It should address conformance to requirements, meeting needs and expectations of customers, as well as price and delivery of product. The organization should establish and use sources of customer information and should cooperate with its customers in order to anticipate future needs. The organization should plan and establish processes for implementing appropriate marketing activities to efficiently obtain the “voice of the customer”.

The organization should specify the methodology and the measures to be used and the frequency of gathering and analyzing data for review.

The organization should plan data collection methodologies. Examples of sources of information on customer satisfaction include:

  • Customer complaints,
  • Direct communication with customers,
  • questionnaires and surveys, .focus groups,
  • Reports from consumer organizations,
  • Reports in various media, and .sector studies.

ISO 9001:2000 - Quality management systems - Requirements
8.2.2 Internal audit

The organization shall conduct internal audits at planned intervals to determine whether the quality management system:

  1. Conforms to the planned arrangements to the requirements of this Internal Standards and to the quality management system requirements established by the organization, and
  2. Is effectively implemented and maintained

An audit program shall be planned, taking into consideration the status and importance of the processes and areas to be audited, as well as the results of previous audits. The audit criteria, scope, frequency and methods shall be defined. Selection of auditors and conduct of audits shall ensure objectivity and impartiality of the audit process. Auditors shall not audit their own work.

The responsibilities and requirements for planning and conducting audits, and for reporting results and maintaining records shall be defined in a documented procedure.

The management responsible for the area being audited shall ensure that actions are taken without under delay to eliminate detected nonconformities and their causes. Follow-up activities shall include the verification of the actions taken and the reporting of verification results.

8.2.2 Internal audit

An organization should establish an internal audit process to assess the strengths and weaknesses of the Quality Management system. The internal audit process may also review the efficiency and effectiveness of other activities and support processes in the organization. The internal audit process should include the planning, implementation, reporting and follow-up activities related to internal audits. Planning for internal audits should be flexible in order to permit changes in emphasis based on findings and observations obtained during the audit Input from the area to be audited, as well as from other interested parties, should be considered in the development of internal audit plans.
Examples for consideration by internal auditing include:

  • existence of adequate documentation,
  • effective implementation of processes,
  • identification of nonconformance,
  • documentation of results, competence of people,
  • opportunities for improvement,
  • capability of processes,
  • use of statistical techniques,
  • use of information technology,
  • analysis of quality cost data,
  • assigned responsibilities and authorities,
  • performance results and expectations,
  • adequacy and accuracy of performance measurement,
  • improvement activities, and
  • relationships with interested parties, including internal customers.

In addition to documenting non-conformances, internal audit reporting could also indicate areas for improvement (with recommendations), as well as areas of outstanding performance.
Examples of follow-up activities include:

  • Verification of implementation,
  • timeliness and effectiveness of corrective action, and
  • Effectiveness of the internal audit process.

8.2.2 Self assessment

Organizations should consider establishing and implementing a self-assessment process. The range and depth d the assessment should be planned in relation to the organization's objectives and priorities. The self-assessment methodology, as well as existing quality awards criteria or other appropriate methodologies may be used for self-assessment of the organization. Some of the advantages of using the self-assessment methodology are that:

  • it is simple to understand,
  • it is easy to use,
  • it has minimal impact on the use of management resources, and
  • it provides input to enhance the performance of the organization's Quality management system.

The self-assessment methodology focuses on determining the degree of efficiency and effectiveness of implementation of the Quality management system defined in this International Standard is not intended to provide a self-assessment methodology to compete with existing models. Self-assessment methodology should not be considered as an alternative to internal or external quality auditing. Use of the methodology can provide an overall view of the performance of the organization and the degree of maturity of the quality management system. It can also provide input for identifying areas in the organization requiring improvement and can help to determine priorities.

8.2.3 Measurement and monitoring of processes

The organization should identify measurement methodologies and perform measurements to evaluate process performance. The organization should consider how these measurements can be incorporated into the product realization process and the role of measurement in process management.
Examples of measures of process performance include:

  • accuracy,
  • timeliness,
  • dependability,
  • reaction time of processes and people to special internal and external requests,
  • cycle time or throughput,
  • effectiveness and efficiency of people,
  • utilization of technologies, and
  • cost reduction.

ISO 9001:2000 - Quality management systems - Requirements
8.2.3 Monitoring and measurement of processes

The organization shall apply suitable methods for measurement and, where applicable, measurement of the quality management system processes. These methods shall demonstrate the ability of the processes to achieve planned results. When planned results are not achieved, correction and corrective action shall be taken, as appropriate, to ensure conformity of the product.

8.2.4 Monitoring and measurement of products

The organization should establish and specify the measurement requirements (including acceptance criteria) for its products. The measurement of product should be planned and performed to verify conformance to specified requirements.

The organization should consider the following when choosing a methodology to measure products:

  1. The conformance to specified requirements of its products, and those provided by suppliers;
  2. The location of each measurement point in its process sequence;
  3. Characteristics to be measured at each point, the documentation and acceptance criteria to be used;
  4. Equipment and tools required;
  5. Customer established points for witness or verification of selected characteristics of a product;
  6. Inspections or testing that are required to be witnessed or performed by statutory and regulatory authorities;
  7. Where, when and how the organization intends, or is required by the customer or statutory and regulatory authorities, to engage qualified third parties to perform
    • type testing,
    • In-process inspections or testing,
    • Product verification,
    • Product validation;
  8. Qualification of material, product, process, people or the quality management system;
  9. Final inspections to confirm that all specified inspections and testing are completed and accepted;
  10. Outputs of the measurement process of the product.

The measurement of product should be performed prior to delivery to verify that the product is in conformance with requirements. The organization should review the approach used for measuring products and the records of verification and make appropriate improvement.
Typical examples of product measurement records include:

  • inspection and test reports,
  • material release notices,
  • certificates as required, and
  • electronic data.

ISO 9001:2000 -Quality management systems - Requirements
8.2.4 Monitoring and measurement of product

The organization shall monitor and measure the characteristics of the product to verify that requirements have been met. This shall be carried out at appropriate stages of the product realization process in accordance with the planned arrangement.
Evidence of conformity with the acceptance criteria shall be maintained. Records shall indicate the person(s) authorizing release of product.
Product release and service delivery shall not proceed until the planned arrangements have been satisfactorily completed, unless otherwise approved by a relevant authority and, where applicable, by the customer.

8.2.4 Measurement and monitoring of satisfaction of interested parties

The organization should identify the measurement information required to meet the needs of other interested parties at appropriate stages of product realization. Such information should include measurements relating to people, owners, suppliers and society.

8.2.4 People in the organization

The organization should:

  • gather the opinion of its people regarding the manner in which the organization satisfies their needs and expectations, and
  • assess individual and collective performances and their contribution to organizational results.

8.2.4 Owners

The organization should:

  • assess its capacity to attain the defined goals,
  • measure financial performance,
  • measure the impact of external factors on results, and
  • identify the value contributed by the actions taken.

8.2.4 Suppliers

The organization should:

  • monitor the performance of suppliers and their compliance with the purchasing policy,
  • measure or monitor the quality of the product purchased, and
  • measure the performance of the purchasing processes of the organization.

8.2.4 Society

The organization should:

  • define appropriate measurements relative to its objectives, for interaction with society, and
  • periodically assess the efficiency of its actions and the perceptions of the results by relevant parts of society.

8.3 Control of nonconformance
General

All people within the organization should have the authority to report non-conformances at any stage of a process. This is particularly true for those people engaged in monitoring processes and process output verification. Prompt attention to non-conformances permits the initiation of prompt corrective action. Authority for reaction to non-conformances should be defined to maintain achievement of product requirements. The organization should control product identification, segregation and disposition in order to prevent misuse. The organization may also need to consider recording information on those non-conformances which are corrected in the normal course of work. Such data can provide valuable information for process improvement. It is essential that all non-conformances be recorded, together with their disposition, to assist learning and provide data for analysis and improvement activities.

8.3 Nonconformance review and disposition

The organization should have a process to provide for review and disposition of all non-conformances. Review of non conformances should be conducted by designated persons to determine if any trends or patterns of occurrence exist. These trends should be considered for improvement and as input to management review. People carrying out the review should be competent to evaluate the effects of the non-conformance and should have the authority and resource to define corrective action. Customer acceptance of the disposition may be a contractual requirement.

ISO 9001:2000-Quality management systems – Requirements
8.3 Control of nonconforming product

The organization shall ensure that product which does not conform to product requirements is identified and controlled to prevent unintended use or delivery. The controls and related responsibilities and authorities for neither dealing with nor conforming product shall be defined in a documented procedure. The organization shall deal with nonconforming product by one or more of the following ways:

  1. By taking action to eliminate the detected nonconformity;
  2. By authorizing its use, release or acceptance under concession by a relevant authority and, where applicable, by the customer;
  3. By taking action to preclude its original intended use or application.

Records of the nature of nonconformities and any subsequent actions taken, including concessions obtained, shall be maintained.
When nonconforming product is corrected it shall be subject to re-verification to demonstrate conformity to the requirements. When nonconforming product is detected after delivery or use has started, the organization shall take action appropriate to the effects, or potential effects, of the nonconformity.

  • operational performance,
  • customer satisfaction and dissatisfaction,
  • satisfaction level of other interested parties,
  • effectiveness and efficiency of - organization,
  • supplier contribution,
  • economics of quality and financial and market-related performance and,
  • benchmarking of performance.

8.4 Analysis of data for improvement

The organization should analyze data from various sources to assess performance against plans and goals and to identify areas for improvement. The organization should plan to use statistical methodologies for data analysis, which can help in assessing, controlling, and improving performance of processes.

The analysis of data can help determine the cause of problems, and therefore guide effective corrective and preventive action. This may require analysis of the product specifications, as well as analysis of relevant processes, operations and quality records.

Information and data from all parts of the organization should be integrated and analyzed to evaluate the overall performance of the organization. The overall performance should be presented in a form that is suitable to different levels of management.

The results of analysis can be used to determine:

  • trends,
  • operational performance,
  • customer satisfaction and dissatisfaction,
  • satisfaction level of other interested parties,
  • effectiveness and efficiency of - organization,
  • supplier contribution,
  • economics of quality and financial and market-related performance and
  • benchmarking of performance.

ISO 9001; 2000 - Quality managements -Requirements
8.4 Analysis of data

The organization shall determine collect and analyze appropriate data to demonstrate the suitability and effectiveness of the quality management system and to evaluate where continual improvement of the effectiveness of the quality management system can be made. This shall include data generated as a result of monitoring and measurement and from other relevant sources.
The organization shall analyze this data to provide information on:

  1. Customer satisfaction (see 8.2.1),
  2. Conformity to product requirements (see 7.2.1),
  3. characteristics and trends of processes and products including opportunities for preventive action, and
  4. suppliers

ISO 9001:2000- Quality management systems - Requirements
8.5 Improvement
8.5.1 Continual improvement

The organization shall continually improve the effectiveness of the quality management system through the use of the quality policy, quality objectives, audit results, analysis of data, corrective and preventive actions and management review.

8.5 Improvement
8.5.1 General

The organization should continually seek to improve its processes, rather than wait for a problem to reveal opportunities for improvement. Potential improvements can range from continual activities to long-term improvement projects. The organization should have a process in place to identify and manage improvement projects.

The efficiency and effectiveness of processes should be emphasized when actions are taken. These actions should be monitored to ensure that desired goals are met. Identification of causes of deviations may result in changes to, the product, processes and even revision of the quality management system.

8.5.2 Corrective action

The organization should plan and establish a process for corrective action. Corrective action planning should include evaluation of the significance of problems affecting quality. The evaluation should be in terms of the potential impact on such aspects as operating costs, costs of nonconformance, performance, dependability, safety and customer satisfaction. Appropriate functions should be represented in the corrective action process.

The organization should identify sources of information, collect information and define the necessary corrective - actions. The defined corrective action should be focused on eliminating causes of nonconformances and defects in order to avoid recurrence.

Examples of sources of information include:

  • customer complaints,
  • non-conformance reports,
  • outputs from management review,
  • internal audit reports,
  • outputs from data analysis,
  • relevant quality management system records,
  • outputs from satisfaction measurements,
  • process measurements and results of self-assessment.

The corrective action process should include:

  • a definition of the causes of non-conformances and defects,
  • elimination of causes of non-conformances and defects,
  • appropriate actions to avoid recurrence of problems, and
  • a record of the activity and results.

Efficiency and effectiveness of processes should be emphasized when actions are taken and the actions should be monitored to ensure that desired goals are met.

Corrective actions should be considered for inclusion in the management review process. For example, corrective actions with high financial impact or those that have significant potential impact on customer satisfaction should be considered.

Root because analysis results should be verified by testing, where appropriate, in order to define effective corrective action.

ISO 9001:2000 -Quality management systems -Requirements
8.5.2 Corrective action

The organization shall take corrective action to eliminate the cause of nonconformities in order to prevent recurrence. Corrective action shall be appropriate to the effects of the nonconformities encountered.
The documented procedure shall be established to define requirement for:

  1. Reviewing nonconformities (including customer complaints);
  2. Determining the causes of nonconformities;
  3. Evaluating the need for actions to ensure that nonconformities do not recur;
  4. Determining and implementing the corrective action needed;
  5. Recording results of action taken;
  6. Reviewing of corrective action taken.

8.5.3 Preventive action

The organization should use preventive methodologies to identify the causes of potential nonconformances. Examples of such methodologies include risk analyses, .trend analyses, statistical process control, fault tree analysis, failure modes and effects and criticality analyses.

Appropriate organizational representatives should participate in the preventive actions. The organization should identify sources of information for planning and prioritizing preventive actions.
Examples of sources are:

  • customer needs and expectations,
  • market analysis,
  • management review output,
  • outputs from data analysis,
  • satisfaction measurements,
  • process measurements,
  • systems that consolidate many sources of customer information,
  • relevant quality management system records,
  • results of self-assessment, and
  • processes that provide early warning of approaching out-of-control operating conditions.

Preventive actions should be considered for inclusion in the management review process. This is especially true for preventive actions with high financial impact or those that have significant potential impact on satisfaction of customers and other interested parties.

ISO 9001:2000-Quality management systems -Requirements
8.5.3 Preventive action

The organization shall determine preventive action to eliminate the causes of potential nonconformities in order to prevent occurrence. Preventive actions shall be appropriate to the effects of the potential problems. A documented procedure shall be established to define requirements for:

  1. Determining potential nonconformities and their causes;
  2. Evaluating the need for action to prevent occurrence of nonconformities;
  3. Determining and implementing action needed;
  4. Records of results of action taken and
  5. Reviewing preventive action taken.

8.5.4 Process for improvement

In addition to the improvement actions described in the previous sub-clauses, the organization should define and implement a methodology for process improvement that can be applied to all processes and activities. Such a standard methodology for process improvement can become a tool for improving internal effectiveness and efficiency, as well as improving the satisfaction of customers and other interested parties.

Examples of inputs to the improvement process include:

  • validation data,
  • test data,
  • requirements and feedback from interested parties,
  • financial data,
  • product performance data, and
  • service delivery data.

The organization should undertake small step improvement activities integral to routine operations in order to maintain continual improvement through involvement of people. Improvement should also be planned for breakthrough projects to achieve specific objectives.

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