TweetSharePinShare55 SharesThe International Organization for Standardization (ISO) has published its new quality management standard, ISO 9004:2018, which aims to help companies achieve sustained success. According to ISO, before any standard is developed, guidance is needed to “confirm that a new international standard in the subject area is really needed”. This applies to the ISO 9004:2018 Quality management – Quality of an organisation – Guidance to achieve sustained success. As its title suggests, ISO 9004:2018 provides “guidance for organisations to achieve sustained success in a complex, demanding and ever-changing environment”. The standard was published in April 2018 and supersedes ISO 9004:2009 as shown in Table A. The standard is not intended for certification and has gone through development. The structure of ISO 9004:2018 is illustrated in Figure A. There are a few things to consider with the new standard. Figure A: Structure of ISO 9004:2018 standard. Clause 4: Quality of an organisation and sustained success The interesting aspect of sub clause 4.1 “Quality of an organisation” is a link to the definition of quality, which is derived from the ISO 9000:2015 Quality management systems – Fundamentals and vocabulary standard. Therefore, ISO 9004:2018 defines the quality of an organisation as “the degree to which the inherent characteristics of the organisation fulfil the needs and expectations of its customers and other interested parties, in order to achieve sustained success”. This is not a one size fits all approach. Companies should ask themselves whether customer loyalty to their products or services guarantees their sustained success. The business environment is becoming more complex. Each organisation needs to define what is significant in its quest to achieve the desired sustained success. In addition, embracing the quality-management principles as outlined in ISO 9001:2015 is recommended. The principles are customer focus, leadership, engagement of people, process approach, improvement, evidence-based decision-making and relationship management. The revised guideline emphasises that organisations should look at customer-focus and relationship-management principles. It’s not surprising that some organisations are embracing a customer-centric outlook. An example of a customer-centric strategy is illustrated in Figure B, which is sourced from an article by Steven MacDonald titled: How to create a customer-centric strategy for your business. Clause 5: Context of an organisation Figure B: How to create a customer-centric strategy for your business. The title of the fifth clause is derived from the ISO High Level Structure (HLS). Assessing a business environment is the ideal place to reflect and act on risks and opportunities. In this case, we take a glimpse into the ISO 9001:2015 Quality Management Standard and Clause 4.1: Understanding the organisation and its context. The fundamental issues to consider are the interested parties, and external and internal issues. Clause 6: Identity of an organisation The clause covers what defines the identity of an organisation. The saying, “tell me who you go with and I’ll tell you who you are”, resonates with many of us. Likewise, an organisation’s identity and context will make or break it. The revised guideline outlines the key features of a corporate identity. These include a mission (the organisation’s purpose for existing); vision (aspiration of what an organisation would like to become); values (principles intended to play a role in shaping the organisation culture and determine what is important in supporting the mission and vision); and culture (beliefs, history, ethics, observed behaviour and attitudes that are interrelated with the identity of the organisation). It is of utmost importance to remember that any organisation that compromises on its mission, vision, values and culture will have short-lived success. Clause 7: Leadership The demand on leadership to energise everyone in the organisation will always be a cornerstone in ensuring sustained success. The clause highlights that top management should show leadership and commitment by “promoting a culture of trust and integrity”. Unlike ISO 9004:2009 Clause 5: Strategy and policy, the new Clause 7.2: Policy and strategy recommends that “top management should set out the organisation’s intentions and direction in terms of ISO 9004:2018 in the form of the organisation’s policy to address aspects such as compliance, quality, environment, energy, employment, occupational health and safety, quality of work life, innovation, security, privacy, data protection and customer experience”. This makes it ideal for an integrated management approach instead of just a stand-alone, quality-focused guideline! Despite the significant changes in the wording or text, strategy formulation and deployment, as well as effective communication thereof, are still relevant in the new guideline. Michael Porter, a leading guru on strategy, sums it up well in his book On Competition. He says: “Strategy renders choices about what not to do, as important as choices about what to do.” Clause 8: Process management Behind the scenes of an organisation’s sustained success lies its core and support processes. This creates a system in which the needs and expectations of interested parties thrive. The revised standard recognises: “Organisations deliver value through activities connected within a network of processes.” Like its predecessor, ISO 9004:2018 also advocates for a process approach if organisations are to attain objectives. Clause 8 has changed significantly and provides value-adding guidance to an organisation’s management system. However, it is important to look out for process risks that could hinder the achievement of objectives. Clause 9: Resource management The availability and provision of resources remains an overwhelming undertaking for many organisations. ISO 9004:2018 requires: “An organisation should determine and manage the resources needed for the achievement of its objectives.” This is not a new clause. A risk-based mindset had already taken stage in the ISO 9004:2009 standard. Examples of internal and external resources are outlined as follows: financial resources; people; organisational knowledge; technology; infrastructure such as equipment, facilities, energy and utilities; the environment for the organisation’s processes; the materials needed for the provision of products and services; information; resources provided externally, including subsidiaries; partnerships and alliances; and natural resources. Clause 10: Analysis and evaluation of an organisation’s performance Sustained success does not happen by mistake. It calls for continual monitoring of the business environment. The requirements in this clause are better understood when reflecting on the ISO 9001:2015 Clause 9.1: Monitoring, measurement, analysis and evaluation. It requires an organisation to determine what needs to be monitored and measured; the methods for monitoring, measurement, analysis and evaluation needed to ensure valid results; when the monitoring and measuring should be performed; and when the results from monitoring and measurement should be analysed and evaluated. Top management needs to have a candid approach when assessing their organisation’s performance. This could be achieved through, but not limited to, key performance indicators, risk assessments, integrated assurance, self-assessments and benchmarking. Clause 11: Improvement, learning and innovation The sustained success of an organisation remains in the balance if improvement, learning and innovation is stagnant. However, this clause confirms the importance of interdependence between improvement, learning and innovation if an organisation is to achieve sustained success. Lastly, the ISO 9004:2018 standard provides a self-assessment tool. The tool can be used to assess its current performance while identifying opportunities for improvement. It is obvious that some organisations have not taken the leap of faith to assess the maturity levels of their management systems. It is not too late. Playing a business-as-usual card is risky. During the last 20 years, I have observed many ISO-certified organisations that have not adopted ISO 9004 to enhance their management systems and performance. These organisations implement and maintain the standards, but never go beyond certification. In this context, I am reminded of a quote by Joe Namath: “If you aren’t going all the way, why go at all?” Organisations that have invested in quality-management systems need to consider the ISO 9004:2018. Leave a Reply Cancel ReplyYour email address will not be published.CommentName* Email* Website Save my name, email, and website in this browser for the next time I comment.