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Pricing and Invoicing in a Quality Manual?



Need fast-thinking response fast!

Help! The CFO of the company has reviewed the Quality Policies Manual and made some handwritten notes. One is a question which I must now go into his office to answer : He wants to know why I haven't dealt with pricing or invoicing, etc. in the manual. He says that the reason we open the doors is to provide a service on a for-profit basis and without this the whole organization would fall apart.

Anyone have a good response????:confused:
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Quite Involved in Discussions
4.3 contract review, pricing is more than likely looked at during as well as quote review during quality planning in relation to control. It is addressed but not directly. Hope this helps or gets your mind thinking in a direction that helps. :D


Super Moderator
What level of participation did he have during the initial workup?
Was he one that was just too busy at the time and would get to it later?

Was any of his staff involved in the initial work? Did they fail to communicate with him?

Tell him it will be addressed as a corrective action and improvement. Ask for his feedback for wording in the manual.

M Greenaway


Traditionally things such as pricing and invoicing have been commercial issues that have fallen outside of the quality management system, although these days people like to address everything in the QMS - down to cleaning the toilets.

You could say that the QMS is based on the requirements of ISO9001:2000 which itself doesnt address the issues of pricing or invoicing.

These things are more commercial/financial management than quality management. But you could welcome the idea of bringing them into the QMS and broadening it to an overall business system (i'm sure Jim Wade would think this a good idea), then you could tell this guy that the functions he mentions could then be open to internal audit. I expect he will back off then !
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not quite there yet

Thanks for your help so far guys.

The manual doesn't mention pricing policies or invoicing policies because what I did was follow the layout of the standard and wrote our policy and responsibilities for each clause. And to be honest, it never occurred to me that these sorts of things belonged in the manual. After all, we will need to give this out to clients - what am I supposed to say? " We will price our products in order to achieve the greatest possible financial gain" ?

Randy, surely you jest. Participation? This is the third issue of the manual that I've provided to him over the last 8 months and this is the first review and response I've gotten. It is still in draft because he and the CEO have dragged their feet in doing the review. This is a one woman show here. I wrote the manual as they expected me to do - that is my job; what I was hired to do. (BTW, his staff consists of one manager and 4 underlings worldwide. We aren't a huge org.)

So, can any of you see what or where I would write something related to ?pricing ? Or invoicing? Or CTR (whatever that means but he used the term)?

My gut response to him is that 1) the manual will be provided to clients and so what would he have me to say? 2) obviously we want to be profitable but the way to do this is through the use of our QMS to please our customers and to control our processes - that there is no separate stand apart "profitability" factor. 3) Our objectives will most likely be somewhat profit related and the manual does address the fact that we establish objectives

I think he is going to make the following arguments : 1) what is this document used for? 2) if it is to communicate the overall intentions of this company to its employees, then why not address how we want to achieve profitability?

The reason why I am having a hard time with this is because I know that the manual is not really something that the employees will read or care about. That the real audience is clients and the auditor. That our employees will only know and care about their procedures. So should I say that??

Mike S.

Happy to be Alive
Trusted Information Resource

FWIW, I've never seen pricing or invoicing directly addressed in a ISO 9000 level 1 QM, and I've read maybe 10 or so from our vendors, etc. IMO it is usually addressed indirectly in the contract review section (quoting) of the QM and the details fall in the level 2 Departmental Procedures and Level 3 work instructions for Sales and Finance. You also bring up a good point -- what do you want to say that your customers should see?

Good luck. Let us know how it goes.

Mike S.


Brow Beating


Just demonstrates no Top Management involvement until now. I agree with db and Martin G.. Product Realization (Contract Review) Process should address terms and conditions, not specific. For example, "Terms and Conditons met? yes-accept order. That's all, JMHO. Martin's suggestion about making it Auditable may be enough to make him back off. I just can't imagine an External Auditor being able to audit financials effectively. To me, it's outside the scope of the Standard. How about your internal auditors? Does he want them to see the pricing policies? Profit margins? They may want bigger raises. :vfunny: This area is usually on a "need to know" basis to the majority of personnel.
It's just another method Top Management uses to keep you in your place. Or maybe, he just wants to see more of you.:lick:

:ko: :smokin:



I was typing my response before I saw yours posted.

Yes, I thought about that approach as well. There are two problems with it : 1) Our "finance group" is small. And everything that we do in performing our business touches their department. The procurement practices, the invoicing issues, the human resources functions, are weaved in and out of this "group". There is no way to separate "them" from "us" 2) And a valid argument is that if good process description and procedures are good business practice for the rest of the us, then why shouldn't we also apply it to our small finance group?

I do want a holistic approach here. That this is a business management philosophy, not a regimented calibrated documented type of compliance thing.

I am not totally opposed to making statements regarding profitability, I just don't know what would be the appropriate thing to say! And I really don't think that the word "profitable" belongs in our Quality Policy (which he is advocating as well!).

M Greenaway


I think you said it yourself when you stated that you constructed the manual around the standard, as most of us do, and the issues in question didnt appear because they are beyond the scope of ISO9001.

I think it is that simple. But welcome the suggestion to include these issues as quite rightly they are important issues that need (and I am sure are) tight control.

Put the ball back in his court that you welcome his suggestion in going beyond ISO9001 (towards ISO9004 and its requirement to address the needs of all stakeholders), and request him to draft some text for inclusion in the manual.

Tell him your primary short term objective is to achieve 9001 compliance, but what he suggests is excellant in moving towards your longer term goals for business improvement.


Super Moderator
Poor quality leads to reduced profitability. Profit and Quality are inter-twined and cannot be separated.

You need to corner this guy and nail him down as to what he thinks is applicable. Turn this into an N/C for Top Management's failure to committment (easier said than done I admit).

This financial stuff is one of the major reasons I went for an MBA. I don't understand it all, but I appreciate the relationship that finance plays with other organizational elements.
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