Defining Measurable Objectives/ Metrics to Drive Continual Improvement

Measurable objectives are an essential input for all levels of the management and come from the top management (TM). These objectives guide personnel at the work level to help ensure the success of a management system. The need for a set of value-based metrics is met by looking carefully at the company policy (based on the strategic direction) and then drawing the measurable objectives from it.

My thought is for any organization giving more than the desired value is a challenge! Values in today’s business world are often related solely to the ROI (Return on Investment). Providing value to the customer is a goal. The question is at what cost? Due to budgetary concerns, no organization wants to do more than what is required. Availability of funds is input to the design of the final product and or service. Consequentially, the values that an organization sets for itself must be based on trying to meet the objectives and expectations of the customers, or the statutory bodies (if relevant) within the constraints of the resources. Where a statutory body is involved, it is the vital responsibility of that body to precisely define expectations and what metrics they will accept.

My opinion is that the statutory bodies such as the FAA, FDA, EPA, and USCG, would have concerns about continual improvement by the external service providers. It is therefore critical to conduct an analysis and conduct management reviews internally to achieve the intended purpose of Clause 10.3 of ISO 9001:2015. However, it all starts with defining, providing and monitoring these clear expectations. This means that the statutory body should provide guidelines for stated requirements, as the IMO does in the ISM Code, within Resolution A.1118(30) & MSC-MEPC.7/Cir8. In a similar manner, the USCG could provide clear guidelines for TPO (Third Party Organization) and for the towing companies for the Subchapter M.

Statutory bodies, understandably, may struggle with defining their policy in the initial stages and clearly converting it to a set of measurable objectives (Value based metrics) for external providers. The need for the Leadership (TM) is to spend time and resources well at the plan stage of the PDCA cycle (Plan-Do-Check-Act) by understanding the context of the organization (Clauses 4.1 and 4.2 of the ISO 9001) and appreciate the various risks (Clause 6.1 of ISO 9001) keeping the customer focus in mind. The Standard here provides useful clauses to make the decision. An objective audit of the internal procedures of the statutory body (Clause 9.2 of ISO 9001) would provide the inputs for the Management Review (Clause 9.3) and ensure a robust decision-making process. This then should be followed by regular audits of the organization to which the processes have been outsourced (meeting the requirements of Clause 8.4.1 and 8.4.2 of ISO 9001). The organization which provides the outsourced service or product needs the information in terms of clause 8.4.3 to perform to the total satisfaction of the statutory body. As such providing clear requirements is a vital role of the statutory body.

Once requirements are clear, then the organization providing a product or service will use these inputs to design their Policy (Clause 5.2 of ISO 9001) 5.2.1d. This policy would then ensure that the feedback loop will help to drive continuous improvement efforts of the QMS. This policy would then provide the framework for the “value-based metrics” which in Quality terms would be the measurable objectives in terms of clause 6.2. Both 6.2.1 and 6.2.2 would put the organization on the correct path to success. The statutory body would vigorously and regularly audit the correct implementation itself or by using an independent professional service provider.

In effect, what this means is that just being certified to e.g. ISO 9001:2015 is not enough for any organization. What is required is a functioning PBMS (process-based management system) based on the chosen standard and other criteria implemented by committed leadership and motivated manpower.

(The author Dr. IJ Arora, is the President and CEO of QMII)

SECURING THE MARITIME IoT FRAMEWORK

As technology advances, there are a growing number of providers that are developing products and services based on the IoT (Internet of Things) framework. In the maritime industry, it is increasingly common for vessel containers to be tracked from ashore and even machinery performance metrics, providing remotely automated readouts, to those ashore. With the increased use of technology, the risk of these networks being compromised also increases. There are a growing number of incidents in the maritime industry where systems were compromised leading to losses in millions of dollars.

On an average when these breaches occur it may take over 100 days before they are even detected! Various maritime organizations and associations have published guidelines on measures to be taken to prevent/deter such a compromise, but history has shown that the maritime industry tends to be more reactive than proactive. Even the ISM code now includes as an appendix a circular on guidelines for maritime security. As part of the implementation of the ISM Code measures for cybersecurity should be included in the system. From the security of networks to machinery to contingency plans in case of breaches occur.

The implementation of cyber-security measures includes the need for protection of three aspects of the system; the IT aspect, the human aspect, and the physical aspect. Organizations need to consider the cyber-security risks at the planning stage of the system and determine where vulnerabilities lie and how to address them. Instead of reinventing the wheel organizations may consider the implementation of an information security management system based on ISO 27001. ISO 27001 lays the framework for the IT security of the system. Once implemented and used, based on industry feedback the standard includes an annex of controls for implementation to secure the system. ISO 27001 has a total of 114 controls split across 35 control categories.

If an organization already has an ISO management system framework in place, for example, an ISO 9001 based system, integration of ISO 27001 into the existing management system would be a simple exercise. This integration has been made easier by ISO through the use of the High-Level Structure across standards. QMII has over 30 plus years encouraged its clients to “appreciate your management system”. As such we build upon your existing measures and documentation to fill the gaps for requirements set by the standard. This ensures continuity in system acceptance by the users, the changes to the system are minimal and easier to implement. For successful implementation of your system beware of templates that promise conformance to the requirements. They may enable you to gain certification but will not ensure any long-term success least of all cybersecurity.

Learn more about how you can improve your management system and integrate the requirements of ISO 27001 into your existing management system.

Monitoring Outsourced Processes is a Primary Responsibility of Every Organization

The international standards provide a world of wisdom enabling robust planning to achieve results by the organizations. In this global economy, often doing all the work in-house is not a cost-effective solution. Moreover, with super-specialized industry requirements, perhaps a lot of quality products and services can be procured at reasonable prices. Yet it seems organizations fail to act in the spirit of the standard when putting in place requirements for monitoring outsourced processes. Clause 8.1 of ISO 9001:2015 in operational planning and control has a sting in the tail with a clear whip requiring that “the organization shall ensure that outsourced processes are controlled.”

Statutory requirements are created to provide the required oversight, maintain customer focus and protect the interests of the customer when products and services are cleared for use. The caveat is that the statutory body should be well resourced, have the infrastructure, maintain organizational knowledge levels (Clauses 7.1.5.1, 7.1.3 & 77.1.6 of ISO 9001) with competent manpower (Clause 7.2). This often is not possible or with time not sustainable due to budgetary constraints, knowledge level dropping with time, Leadership forgetting their primary role (Clause 5.1.1) of taking accountability for the effectiveness of the QMS (Quality Management System). As such, the resources (5.1.1 e) needed for the QMS are not provided or budgets not available. The statutory bodies rationalize it by their helplessness since the government does not provide the funding and budgetary support for this.

Whatever the reasons, the question is who suffers? A ship is sunk, and aircraft with all on board has crashed, dangerous drugs are in use. It is the customer who suffers. In helplessness on their ability to do their duties, the statutory bodies outsource the work to contracted parties or worst to the manufacturer itself! The whole logic of creating a statutory body is lost with this.

What then is the remedy? The essential rulemaking that implements compliance requires competence, resources, and infrastructure with a committed Leadership ensuring continuing suitability, adequacy and effectiveness of the system. When budgetary constraints do not allow this role to be fulfilled, the risk to the system along with the products and services it provides must be assessed and mitigated or the opportunity for improvement taken (Clause 6.1 of the ISO 9001).  This would require the authority to appreciate the FMEA (Failure Mode Effect and Analysis) and take measures to remedy this. If this risk is not appreciated as NC (Non-conformity) the CA (Corrective Action) will not take place nor will the government know of the consequences of underfunding or of recognizing the failure and finding alternatives/ considering options. If the manufacturer has the resources, the government may consider this an asset and avoid duplication of resources, thinking in national terms. Outsourcing to the manufacturer as has been seen can mean losing customer focus and is strict counter to the very philosophy of statutory work. It would call for aggressive, proactive and strict monitoring of the outsourced processes.

In my opinion, monitoring the outsourced processes diligently, as clearly prescribed in the standard is the answer. New options may not be necessary, if the existing clauses of ISO 9001 and related industry-specific standards, where applicable, are understood in the spirit of the standard and vigorously implemented.

  • Dr. IJ Arora

AUDITING RISK-BASED THINKING

 

As we work with clients, we find increasing examples of certification bodies requiring risk to be documented within an organization. This despite ISO 9001 specifically not requiring so!

This then brings up the question, “How should we audit the requirements of risk-based thinking within an organization when the same has not been documented using a formal risks management system or methodologies such as FMEA?”.

Let us start with the intent of including ‘risk-based thinking’ in the standard, replacing the previous requirement for ‘preventive action’. Risk-based thinking has been included as a preventive measure with the intent of making an organization more proactive to identifying and addressing potential non-conformities (NCs) than to be reactive to NCs. Additionally, rather than limit preventive action to the end of the PDCA cycle it is now addressed throughout the standard with the concept of risk-based thinking. To therefore answer the question posed above auditors need to evidence risk-based thinking throughout the system starting with the management down through the operator/service provider.

Before we begin to discuss the process for doing this let us for recall how many times a preventive action has been raised within our organization when the requirement did exist under ISO 9001:2008. In my auditing experience the answer is rarely! This in essence defeats the purpose of what the standard was trying to achieve.

Before we begin to audit risk based thinking the auditor should get an understanding from management of the context of the organization and the needs of the interested parties relevant to the organization as identified by them. Keep in mind the requirement of Clause 4.1 and 4.2 also need not be documented. Further what are the risks that management has associated with the organization achieving its strategic direction. We can also evidence the records of the management review to assess the inputs provided to management per Clause 9.3.2 e.

Once we have the above understanding from leadership, we then look for evidence on how the organization has addressed the risks as identified by leadership. These may include as an example risks to meeting business/process objectives, risks from loss of personnel, risks from new legislation that may impact the organization etc. As we audit the organization, we are looking to assess how the processes have been resourced and controlled in order to manage the risk of not meeting the process objective or customer/regulatory requirements. Risk based thinking is inherent in the clauses for design where organizations are asked to consider the potential causes of failure, in the purchasing process where the organization is asked to select external providers based on their ability to provide products/services meeting requirements, in the planning of audits, in the determination of customer requirements (intended use & unstated requirements), in the resourcing of the system, in the fitness for purpose of monitoring and measuring equipment and in the determination of potential similar non-conformities when taking corrective action.

The above is but a sample of where the application of risk-based thinking can be evidenced. Further information from analysis of data per clause 9.1.3 is further sued as a source for improvement as per clause 10.1 and all of this can be evidenced in the system.

So then why are certification body auditors seeking a documented risk-management system? Auditees too often do not push back when such a “requirement” is brought up. It does make the audit easier if everything is documented including risk but then are, we really ensuring the effective application of the standard. The organization could meet this “requirement” for documentation of risk by just documenting two or three risks and monitoring the effectiveness of actions taken to address them. This would meet the auditors requirement but then what about other applicable risks? These would then do unaddressed as the organization will tend to focus on the documented ones, killing the system!

Let us determine the need to document the risks within our system or NOT and not be pressured into documenting our system to meet the needs of auditors.