ISO 9001:2015 QMS Awareness - Understanding Organization And Its Context

ISO 9001:2015 QMS Awareness - Understanding Organization And Its Context

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ISO 9001:2015 QMS standard in its clause 4.1 makes emphasis on clear understanding of the organization's context. The standard requires an organization to:

(i)        determine external and internal issues (positive and negative factors or conditions) that are relevant to its purpose and its strategic direction and that affect organization's ability to achieve the intended result(s).

(ii)       monitor and review information (data) about the determined external and internal issues (positive and negative factors or conditions).

 

The intent of the requirements is to understand important issues that can affect, either positively or negatively, the way the organization manages its quality management system to achieve the desired result(s). Requirements mentioned in clause 4.1 are too general and one may think many issues that may or may not be relevant. Consider only those issues that are relevant to the quality management system.

 

We should have a clarity that there are many issues that can help or make easier the understanding the external context of the organization and such issues may arise from legal, technological, competitive, cultural, social and economic environments and that can be global, national, regional or local. There are many other issues that can help or make easier the understanding the internal context of the organization and such issues may relate to the organization's values, culture, knowledge and performance.

 

What may be the source of information about internal and external issues? There may be various sources that may provide information about internal and external issues of an organization, such as:

 

- Internal records and documented information of the organization,

- Internal and external meetings,

- National and international news and reports,

- Various websites, for example - website of government, regulatory body, tax authority, competitors etc.

- Various publications, for example - government, professional, technical, sector publications,

- Conferences,

- Professional and business associations in your area, such as - Confederation of Indian Industry (CII), Association of Computing Machinery (ACM), SME Chamber of India, Ajmer Zila Laghu Udhyog Sangh etc.

 

Why an organization need to determine external and internal issues? One may answer, it is a requirement. But why is this a requirement? There are reasons, because:

(i)        the organization needs to take better decisions based on evidence.

(ii)       The potential benefits of implementing ISO 9001:2015 QMS standard to an organization is addressing risks and opportunities associated with its context and objectives. This leads to continual improvement in the quality management system.

 

Addressing risks and opportunities lead to proactively managing uncertainties that lead to better decisions based on evidence. This reminds 'evidence-based decision making' principle among the seven quality management principles on which ISO 9001:2015 QMS standard is based. Clause 0.1 of ISO 9001:2015 QMS standard also has a reference of the potential benefits of implementing ISO 9001:2015 QMS.

 

Internal context of an organization is the environment in which organization targets to achieve its objectives. Issues that need to be considered are related to culture, beliefs, values, or principles inside the organization, as well as the complexity of processes and organizational structure.

 

Typical examples of internal issues in an organization may be:

 

-    Management structure and decision-making processes

-    Employee skills and training

-    Information technology infrastructure

-    Products / services offerings and their quality

-    Financial resources and budget constraints

-    Production processes and production capacity

-    Supply chain management within the organization

-    Health and safety policies and procedures

-    Employee morale, management-employee relationship and job satisfaction

-    Compliance with legal and regulatory requirements

-    Internal governance, organizational structure, roles, responsibilities and authorities

-    Organizational assets (facilities, building, machinery, equipment, technology)

-    Information system within the organization, communication of guidelines

-    Organization culture

-    Perception of internal stakeholders (owners, internal suppliers, partners)

 

External context of an organization relates to the issues that may arise from legal, cultural, social, technological, competitive, economic environment that can be global, national, regional or local. Relevant external issues should be considered, while managing risks, uncertainty and opportunities and also at the time when you make decisions that may affect quality of the product / service your organization provides.

 

Typical examples of external issues in an organization may be:

 

-    Economic conditions, market trends and competition

-    Customer needs and expectations

-    Competitors and their strategies

-    Political and legal changes

-    Government regulations

-    Technological developments

-    Environmental concerns and related regulations

-    Social and cultural factors

-    Supply chain management

-    Natural disasters and other unforeseeable events

-    Trade restrictions and tariffs

-    Changes in industry standards and best practices

-    Certain events (such as trade fairs) providing new concepts / development

 

ISO 9001:2015 QMS standard does not provide direction on the method to determine such issues. It is for the organization to apply its own suitable method. One such method to determine, monitor and review the internal and external issues may consists of following steps –

 

(i)        The top management of the organization should constitute a team of identified persons, who are well-versed with organization and its processes.

(ii)       The team members should think individually as well as collectively and identify positive / negative factors and conditions that are relevant and that can affect achievement of organization's goals / objectives.

(iii)      All such identified issues should be summed-up. As such, the team should make a list of all such issues with necessary details.

(iv)      Assign responsibility to monitor and review such issues to the team, so that the team monitor and review identified issues from time to time and effective decisions can be taken for the improvement. It is better to define the scope of the monitoring and reviewing process, including the issues that will be tracked, the frequency of reviews, and the objectives of the process, the method of data collection, analysis and interpretation of data and reporting of findings. The team should identify the sources of information that will be used to monitor and review the internal and external issues. These sources can include customer feedback, employee surveys, industry reports, market analysis, and other relevant sources of information.  

(v)       All outcomes should be summed-up and necessary decision be taken for improvement.

(vi)      Take action - Based on the findings of the monitoring and review process, the organization should take action to address any issues or trends that could impact its ability to achieve its objectives. This could include changes to policies, procedures, or processes, as well as additional training or resources for employees.

(vii)     Continually improve - Finally, the organization should continually improve its monitoring and review process, incorporating feedback and making adjustments to the plan as needed to ensure it remains effective and relevant over time.

 

By following above steps, an organization can effectively determine, monitor and review both internal and external issues, and take proactive steps to address any factors that could impact its ability to achieve its objectives.

 

We find that the requirements of ISO 9001:2015 QMS standard starts with asking for determination of all issues that can enhance or interrupt achievement of the quality management system outcomes. The organizational issues may be internal and/or external that should be well defined, substantially subjective or not, so well defined. We need to understand them. A subjective issue may be internal issue within and among groups / people in the organization. It is required for the organization to monitor and review all those issues that can affect achievement of defined goals. With monitoring and reviewing internal and external issues, an organization is better prepared to make improvement and thus leads to a success path. It's always important to have a good understanding of the internal and external issues that can affect an organization's ability to achieve its goals and objectives, and to develop appropriate strategies to address these issues.

 

While auditing the standard's requirements, auditor would look into the objective evidence how the organization determined the issues related to the context of the organization, so well defined process will be useful.

 

Think of following Questions:

(i) What are the requirements for understanding organization and its context in ISO 9001:2015 QMS standard?

(ii) Why should an organization determine internal and external issues?

(iii) What can be internal issues that can affect organizational ability to achieve intended results?

(iv) What can be external issues that can affect organizational ability to achieve intended results?

(v) What may be the step-by-step process for understanding the organization and its context.

 

Best wishes,

 

- Keshav Ram Singhal

 

Please have your comments / reaction.

 

To train your employees with ISO 9001:2015 QMS Awareness, please supply them “TRAINING HANDBOOK ON ISO 9001:2015 QMS AWARENESS” (ASIN‏: ‎B093YFFY7Z), which is available worldwide at Amazon.

 

Thanks.