Modernisation and risk-based thinking

In the 1987/1994 versions, the focus was on the customer-supplier relationship. Quality-assured processes (including quality control, prevention, error correction, reliability of evidence) were intended to strengthen customer confidence in the organization's products and services. 2000/2008 by means of the process orientation regarding the demands and expectations of the customers the customer satisfaction should be strengthened by constant improvement (customer orientation). However, the process management defined in this way could still be operated largely in parallel with the service production. The 2015 version sees quality management as an integral part of the business processes and focuses even more on the effectiveness of the system deployment and the processes to achieve the intended results of the QMS respectively of the organization including its strategic orientation. In this context, the focus is now extended beyond the customer to all groups interested in the organization. Associated with this are relevant issues arising from the organization's environment (context issues), the identification and assessment of risks and opportunities, increased and extended requirements for leadership and attention to the knowledge required to manage change and implement processes (Fig. 1). Ultimately, ISO 9001:2015 includes a good amount of flexibility in the documentation of the QMS, including its processes and evidence. In many places, the user is required to adapt the extent of the documentation to the requirements. Effectiveness in this context means establishing confidence that operations (processes) are performed as planned and that the intended results are achieved. This makes the standard also applicable to SMEs in a good and benefit-oriented way.

Uniform basic structure for management system standards

A few years ago, ISO developed a new content structure with generally applicable specifications for management systems. This so-called high-level structure (HLS) is the same for all ISO management system standards and is binding. It contains uniform main chapters, subchapters, requirement texts per subchapter and uniform terms (part of the ISO directives - see also www.iso.org). The HLS requirements must be fully adopted in all management system standards. Many changes in the new edition of ISO 9001, but not all, are thus HLS-related, e.g. Chapter 4, Context of the enterprise. The same requirements are then also found in other management system standards.

While the requirements in ISO 9001:2008 are divided into five main chapters (chapters 4-8), ISO 9001:2015 consists of ten main chapters (chapters 4-10). The following content structure exists for the new requirements:

• Chapter 4 - Contextual requirements / Risk-based thinking
• Chapter 5 - Leadership demands in the centre, quasi as a motor of an effective and PDCA-based system (Plan- Do-Check-Act)
• Chapters 6-10 Increased results orientation by means of extended process management based on PDCA the chapters 6: Planning (P), 7: Support (D), 8: Realization/Operation (D), 9: Evaluation of performance (C) and 10: Improvement (A). (Cf. Fig. 1).

It is important to note that there is no requirement for users to undertake a QMS rebuild to meet the requirements of ISO 9001:2015 due to the new structure.

Integration of different management systems more easily possible

By introducing the high-level structure, the compatibility of ISO 9001 with other management systems increases and users benefit from additional synergies. Among other things, once established, trained and proven concepts and procedures are much easier and with less effort transferable to other management disciplines and also combinable, the security regarding the appropriate implementation increases and uncertainties regarding different interpretation of requirements decrease. Unwanted coordination efforts disappear. ISO will also support this process at standards level by making the HLS text parts of the discipline-specific supplemented texts (e.g. QMS-specific supplements in ISO 9001) visible in the standard, e.g. through different text color.

Improved applicability for service providers

ISO 9001 is in principle intended for use by all types of organizations, regardless of type, structure, range, size, complexity of activity, etc. In the development of ISO 9001:2015, specific attention has been paid to the terms chosen and the formulation of requirements so that comprehensibility and suitability also fit service organizations. This applies to all types of services, whether private, public or social. The suitability for use in the environment of the increased dynamics of change in business models under the influence of new technologies was also taken into account when defining the requirements.

Promote risk-based thinking in the organization

The new standard is intended to support risk-based thinking in particular. The identified risks and opportunities are the starting point for creating QMS-like specifications, establishing performance targets and organizing continuous improvement. The risk-based approach therefore does not require risk management according to e.g. ISO 31000 with the classical instruments of risk analysis. Organizations that already (have to) use such an analysis should of course continue to do so, however. In business administration, the instruments presented below form a bridge between strategy and the operational activities of an organization and are intended to do just that: To make risks widely recognizable at an early stage and to prepare them for discussion and evaluation within the management. These tools and techniques represent possibilities and suggestions for optimizing a QMS in terms of benefits and continuous improvement, but do not claim to be the only ones possible or mandatory in this form. Other and also simpler tools may be appropriate depending on the situation of the organisation.

Understanding competition in the industry (NK 3.26/3.27/4.1)

One approach also used by trusts to understand the dynamics of an industry is Porter's 5 forces model. This involves assessing: How high are the barriers for new suppliers to enter the market (protective effect)? How strong is the bargaining power of suppliers on the one hand (procurement risks and costs) and buyers on the other (achievable price level)? To what extent can existing products and services be expected to be substituted by faster, cheaper and better processes (technical progress and innovation dynamics)? Last but not least, the intensity of competition in the industry (achievable margins) plays a role in the profitability of the industry. Legal regulations and ordinances can have an influence on all of the above factors (change or constancy of the "rules of the game").

Making future developments visible Environment

"A better understanding of external changes/trends in politics, environment, laws, technology creates competitive advantages. The consideration of competition, markets, social and societal, economy, etc. can be international, national, regional or local ". (NC 3.24/4.1)

For a systematic trend analysis, the St.Gallen Management Model is a good choice. The model allows a systematic structuring and identification of fields in which important changes for the organization can take place. On the one hand, procurement and sales markets form pillars of this model. On the other hand, the environment is bundled into so-called spheres. Specifically, these are society, nature, technology and the economy.

On the procurement side, it is not only bottleneck materials that need to be considered. Where demand or political distortions can occur, increased monitoring is appropriate. The "procurement" of employees, energy, capital or information should also be considered here. Bottlenecks are partly industry-specific. In the case of sales markets, dependencies on certain customers or industries as well as shifts from traditional sales channels to Internet-based channels are of importance. Multimedia and informed customers are changing the relationship with the organization. However, it is also important to keep an eye on developments in the payment behavior of customers.

The sphere of "society" can be further subdivided into changes in values, demographic change or regulations through laws and ordinances. In the "Nature" sphere, product recycling, environmental management, other energy sources or expected restrictions on individual mobility play a role. Technology" includes developments in product and process technology. In the case of the "economy" factor, fluctuations and discontinuities in the economic situation and political influences (immigration control, export financing, export restrictions, etc.) are significant.

The positioning of the industry in a matrix of market attractiveness and market growth provides additional information as to whether there is an opportunity or threat. For an initial analysis of the significance on the organisation's activities, a classification into "low", "medium" and "strong" should be sufficient. The strong trends of the external environment determined in this way are subsequently assessed as an opportunity (O) or a threat (T) for the organisation.

Identify capabilities and resources of the organization

"Focused development of internal issues such as structure, values, culture, knowledge, systems, skills, and performance creates differentiators for the organization." (NK 3.09/3.24./3.35/4.1/6.1/6.2)

One's own capabilities and resources can be presented by means of a grid, such as that provided by Lombriser and Abplanalp. The most important factors are determined qualitatively (better, same, worse) in comparison to the strongest competition. Depending on the assessment of the factors mentioned, an assignment is made as strength (S) or weakness (W). Internally, complicated processes, the overload of managers and employees, a low willingness to change or, for example, unresolved succession of owners or managers can be relevant factors.

Systematize strengths, weaknesses, opportunities and threats (SWOT)

"A systematic approach to managing risks and opportunities helps the organization decide whether risks can be avoided, mitigated, passed on or accepted. In turn, this forms the basis for decisions to consciously take certain risks in order to seize potential opportunities." (NK 3.09/3.24./3.35/4.1/6.1/6.2)

The information is now combined in a matrix. The strengths S and weaknesses W are plotted on the vertical and the opportunities O and threats T on the horizontal. The intersections result in four fields of action: The combination SO and ST allows for measures that should be managed on their own. The ST require increased efforts, e.g. in marketing or in product and process innovation. The WO and WT fields require more far-reaching decisions. WO strategies are characterized by entering into strategic networks, joint ventures or relocating production. In the WT field, the main options are sale or discontinuation of the relevant activities. Another option is to diversify from within or through acquisitions, but the chances of success are drastically lower than for the other alternatives, and the risks are therefore significantly higher (Fig. 3).

Capture the influence of stakeholders

"Identifying a company's relevant interested parties will promote successful positioning of the organization." (NK 3.02/4.2)

Every organization has a specific set of stakeholders. A classification grid, similar to the trend analysis, is useful for a systematic identification and overview. Suppliers and competitors can be just as much a part of the stakeholder group as "society" (the public, politicians, neighbours, employee representatives, etc.). "Business" may include owners, shareholders, banks, tax authorities or subsidy providers. Employees and management of an organization also belong to this category. Key customers are an important group. This stakeholder group will be discussed in more detail in the second part of this publication (June issue of this journal) under the focus "increased leadership requirements". A matrix with the axes "interest in the organization" and "influence/power on the organization" is suitable for defining targeted support procedures for the various groups. Dividing the axes into "Low" and "High" avoids indecisive "middle of the road" classifications. The resulting four quadrants then range from "attend minimally" with low interest and low power, to "inform actively" with high interest and low power, to "satisfy " with low interest and high power, to key groups with high interest and high power. Here it is called, intensive and "(pro) actively care".

Literature

• Knut Bleicher: The Concept of Integrated Management. 8th ed. Frankfurt /New York, 2011 -
• Roman Lombriser/Peter A. Abplanalp: Strategic Management. 5th ed. Zurich, 2010
• Michael E. Porter: Competitive Strategy. New York,1980
• ISO/DIS 9001: Quality management systems - Requirements. Geneva, 2014