View Full Version : Are implementation of Quality and Safety Standards Extra Business Costs?
eternal_atlas 25th August 2008, 03:13 AM This is a comment from all our project managers about the quality and safety standards implemented in our company.
Please throw your opinion on these below mentioned comments.
1.Following ISO Standards increases the employee cost.. since we have to appoint safety officers,quality assurance engineers etc.,
2. Going for a purchase with the only vendor who is having a evidence of following QMS leads to buy at a high price..
3. Raising a non-conformance to the supplier affects the business relationship with the vendor and organisation
4.Following ISO procedures strictly affect the project effeciency. say for example.. preparing project execution plan only for documentation purposes.. conducting meaningless weekly department meeting,conducting management review meeting only for the documentation purposes.. measuring customer feedback only from the customers who are happy..
5. Calibration Cost,Equipment Maintenance Cost etc..
harry 25th August 2008, 04:09 AM These are my views and experience (sorry if you don't like it).
Item 1 - It does increase the cost a bit but the returns are more than adequate to defray these cost. First, it is about business strategy - you choose your own play ground and if your choice is the cut throat volume type of work, it will be more difficult but still possible because a tighter control through the system can result in savings in material plus mistakes/rework.
Next, ISO is just a QM system. Not everybody get the same results after implementation. What kind of result you will finally get is dependent on how well you know the system and the construction business and how well you integrate them. If you force-feed, chances are you will get negative results and resistance.
Item 2-5 These are traditional excuses for not implementing a system or evidence of resistance. In another thread, you questioned about the auditors finding on your poorly communicated policy. You imply that the auditor is nit-picking but with what you mentioned in this post, I give him the benefit of doubt in that finding. I am of the view that the implementation of the system at your place needs review and beefing up.
By the way, do you have management commitment? If not and if left to the operations or project people, then these excuses will surface also.
Colpart 25th August 2008, 06:26 AM Great answers Harry - here's my views on the subject:
1 - Yes, there is a cost involved - consider it more as an investment.
2 - Who said you have to do that? it is not part of ISO 9001 requirements
3 - So, if you are unhappy with what you have bought you should just put up with it?
4 - If you are documenting things that genuinely don't help you, why are you doing it?
5 - What is the point of measuring something if you can't trust the results? (calibration) and would you sooner wait until your car breaks down at an in-opportune moment or at least keep it in good shape.
Forgive my assumption but it could be that you have a system which needs some improvement (or is that too much trouble too) in order to start getting the benefits from your system.
BradM 25th August 2008, 08:47 AM Yes, these are all extra business costs. If you try to run and cover this fact up, then astute managers and bean counter will become your nemesis.
Doing things right will always cost more than just getting by in the short term. However, the long-term benefits of increased reputation, market share, decreased failures in quality, employee quality of life, non-imitable resources, etc. will outweigh the short term costs.
In the process mapping forum, I started a thread on the excellence of Disney. I can guarantee with high certainty that Disney does not engage in the practice of questioning the additional cost of quality and safety standards. Their risk management stance is evident by Duke Oakes statement alone.
IMHO, adding every "demand-side" cost of the equation ignores and/all effects to the "supply-side" of the equation.
eternal_atlas 25th August 2008, 10:15 AM We are following the QMS for the past 8 years in our organization. Resistance won’t be there in our company since top man is driving the QMS vehicle...
Top Management is reviewing each and every line of the audit report and non-conformances issued to the projects are linked with the performance of the project managersThese are my views and experience (sorry if you don't like it).
Item 1 - It does increase the cost a bit but the returns are more than adequate to defray these cost. First, it is about business strategy - you choose your own play ground and if your choice is the cut throat volume type of work, it will be more difficult but still possible because a tighter control through the system can result in savings in material plus mistakes/rework.
Next, ISO is just a QM system. Not everybody get the same results after implementation. What kind of result you will finally get is dependent on how well you know the system and the construction business and how well you integrate them. If you force-feed, chances are you will get negative results and resistance.
Item 2-5 These are traditional excuses for not implementing a system or evidence of resistance. In another thread, you questioned about the auditors finding on your poorly communicated policy. You imply that the auditor is nit-picking but with what you mentioned in this post, I give him the benefit of doubt in that finding. I am of the view that the implementation of the system at your place needs review and beefing up.
By the way, do you have management commitment? If not and if left to the operations or project people, then these excuses will surface also.
harry 25th August 2008, 10:58 AM We are following the QMS for the past 8 years in our organization. Resistance won’t be there in our company since top man is driving the QMS vehicle...
Top Management is reviewing each and every line of the audit report and non-conformances issued to the projects are linked with the performance of the project managers
I admit that I had been reading in between the lines. In another thread: NC for poorly communicated Quality Policy - does it add value to an audit?, you wrote:
Even project manager just read it by seeing the poster..
Answers from few Project Managers :
"They have taken the copy of the quality policy and read the policy statement infront of the auditors and could not able to give the convincing answer for the policy deployment in the projects.. say for example.. when auditor asked about the "Avoiding Re-work" and all project managers say that there is no rework in the project and they didnot explain what preventive actions or mechanism is available in their project to control the rework."
Normally, this kind of thing and/or attitude should not exist in an organization with good management commitment.
eternal_atlas 25th August 2008, 10:59 AM Great answers Harry - here's my views on the subject:
1 - Yes, there is a cost involved - consider it more as an investment.
2 - Who said you have to do that? it is not part of ISO 9001 requirements
3 - So, if you are unhappy with what you have bought you should just put up with it?
4 - If you are documenting things that genuinely don't help you, why are you doing it?
5 - What is the point of measuring something if you can't trust the results? (calibration) and would you sooner wait until your car breaks down at an in-opportune moment or at least keep it in good shape.
Forgive my assumption but it could be that you have a system which needs some improvement (or is that too much trouble too) in order to start getting the benefits from your system.
1. I agree with you..
2. Then what do you mean by the requirement of 7.4.2(b)
3. I agree with you..
4. Documentation to satisfy for the certification auditors purposes.
5. I agree with you ..
Randy 25th August 2008, 12:12 PM 4. Documentation to satisfy for the certification auditors purposes.
The purpose of the certification auditor is to verify that you have effectively met the requirements of the standard. Document what you need, to effectively do, what you need to do.
Your job isn't to make some auditor happy. It doesn't matter what an auditor likes or dislikes.
eternal_atlas 26th August 2008, 02:15 AM The purpose of the certification auditor is to verify that you have effectively met the requirements of the standard. Document what you need, to effectively do, what you need to do.
Your job isn't to make some auditor happy. It doesn't matter what an auditor likes or dislikes.
You are right.. Thats why, Internal Audit is more powerful,strict,result oriented than external audit..
joshua_sx1 26th August 2008, 05:04 AM ... Thats why, Internal Audit is more powerful,strict,result oriented than external audit...
…I cannot disagree on this…
…unfortunately, internal audit also, sometimes, is the most ignored audit…
eternal_atlas 26th August 2008, 05:26 AM …I cannot disagree on this…
…unfortunately, internal audit also, sometimes, is the most ignored audit…
Dear Joshua,
There you need management commitment so that internal audit will be as of value and result oriented..
but, i never seen the organisation is serious about the external audits.. since it is diluted in business point of view..
JaneB 26th August 2008, 11:29 PM This is a comment from all our project managers about the quality and safety standards implemented in our company.
Please throw your opinion on these below mentioned comments.
1.Following ISO Standards increases the employee cost.. since we have to appoint safety officers,quality assurance engineers etc.,
2. Going for a purchase with the only vendor who is having a evidence of following QMS leads to buy at a high price..
3. Raising a non-conformance to the supplier affects the business relationship with the vendor and organisation
4.Following ISO procedures strictly affect the project effeciency. say for example.. preparing project execution plan only for documentation purposes.. conducting meaningless weekly department meeting,conducting management review meeting only for the documentation purposes.. measuring customer feedback only from the customers who are happy..
5. Calibration Cost,Equipment Maintenance Cost etc..
Lots of good points have already been made. It is an old, old complaint that it 'costs more'. Short term attitude - NOT having quality/safety etc achieved consistently and reliably is just waiting for the big problem/s to arrive. I pay my insurance every year as insurance in case.
I do query, however, if you are ascribing problems to ISO itself, and whether it it's possible that the way the system has been implemented might add to the way it is perceived? For example:
1. nothing in 'ISO' insists on having to 'appoint safety officers,quality assurance engineers'. But yes, Standards do require responsibilities & authorities for say quality & safety overall to be assigned. (If not, how on earth do you ensure these are achieved???)
2. IF you can get the same quality standards at a lower price, fine. Can you? Consistently?
3. I'd hope that raising an NC does affect a business relationship. Because if a supplier is producing/delivering stuff that doesn't do what you want, there's a problem. Perhaps there is room for improving the system, but.
4. There is no such things as 'ISO procedures'. There is such a thing as requirements for procedures. If weekly meetings are 'meaningless' - change the frequency!
If MRs are only 'for documentation' & you're only measuring 'happy customers' then you (meainng company) are definitely missing the point and not getting value from your system. Perhaps you are following the letter of the Standard but not seeing its real purpose and value.
These are NOT the fault of an ISO Standard, they are faults in implementation. Without real commitment to a real policy & to really 'embracing' a Standard... it's a case of garbage in and too sadly, too frequently, garbage out.
vanputten 27th August 2008, 01:33 PM Capital expenditure is a business cost. New products are a business cost. New employees are a business cost. New facitlities, etc., etc., etc.
What things don't add new business costs? The question is one of economics. What is the benefit for the expenditure?
JaneB 29th August 2008, 05:34 AM The question is one of economics. What is the benefit for the expenditure?
Precisely so. And that's always a valid question, and worth asking.
MIREGMGR 29th August 2008, 05:55 AM 1.Following ISO Standards increases the employee cost.. since we have to appoint safety officers,quality assurance engineers etc.,
2. Going for a purchase with the only vendor who is having a evidence of following QMS leads to buy at a high price..
3. Raising a non-conformance to the supplier affects the business relationship with the vendor and organisation
4.Following ISO procedures strictly affect the project effeciency. say for example.. preparing project execution plan only for documentation purposes.. conducting meaningless weekly department meeting,conducting management review meeting only for the documentation purposes.. measuring customer feedback only from the customers who are happy..
5. Calibration Cost,Equipment Maintenance Cost etc..
Heh. We're a medical device company. For us, the costs of QA/RA are only "extra" compared to the rather lower expenditures involved in either being a lawbreaker or being out of business.
In order to be a viable business and make profits by selling products to customers, you have to spend money on certain things...personnel, buildings, and (at least in our industry) QA/RA. Anyone that doesn't understand that, urgently needs training to get them to understand how the system works. Maybe other businesses are different, but my employer will not tolerate undercutting of our strategic position by means of the above-exemplified kind of thinking. That's direct from the owner, face to face throughout the organization, on a daily basis.
Paul Simpson 29th August 2008, 07:40 AM There's the old definition of an accountant to throw into the mix:
Someone who knows the price of everything but the value of nothing! :lol:
But seriously .... all we are talking about here is the cost of specialization. Most organizations decide at some point in their development to put a lot of the quality responsibilities (for example) in the hands (or on the shoulders depending on your point of view :D) of a single person. All of the quality activities should be needed by the organization to satisfy the organization's customers and / or reduce business risk - if not they shouldn't be done!
Now the problem comes with larger organizations when activities that don't add any value are still done because "people have always done it this way" or the "specialist" says they have to be done (when in fact they don't) for reasons of job protection or whatever.:mg:
:2cents:
Randy 29th August 2008, 09:25 AM Capital expenditure is a business cost. New products are a business cost. New employees are a business cost. New facitlities, etc., etc., etc.
What things don't add new business costs? The question is one of economics. What is the benefit for the expenditure?
NOOOOOOOOOOOOOOOOOOOOO!:mad::blowup:
Capital expenditure, new products new employees, new facilities, etc... are not costs!:nope:
You said it yourself...What is the benefit for the expenditure? There is no expectation for benefit from a cost (Benefit is called ROI...Return on Investment)
If there was no expectation nobody, nobody would be doing any ISO systems anything. Organizations do not go through the problems, stress and pain-in-the-butt implementing and maintaining a management system just to get a nice warm fuzzy at the end of the day. And don't kid yourself into the "Organizations do it because it is the right thing to do..." crowd..........Horse-bagles:horse:
Systems implementations are an investment and require the same level of detail and attention as any other capital project an organization undertakes. Because many organizations have not been educated to that fact is the reason we see so many bogus, half-hearted, Bul--hit systems in place..........the system is looked upon as another load of copy paper and rubber bands (cost).
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