International Aspects of Quality-ISO 9000 Quality Standards:
Many of the tools used in quality management today were developed in Japan after World War II. In statistical process control, Japanese companies borrowed heavily from the work of Edwards Deming, However, Japanese companies are largely responsible for quality circles, JIT, the idea the the quality is everyone’s responsibility, and the emphasis on prevention rather than on inspection.
In 1980s, quality reemerged as a pivotal factor in the market. Many companies find that it is impossible to effectively compete without a very strong quality program in place. This is particularly true of companies that wish to compete in the European market.
The ISO 9000 Standards:
The International standards Organization (ISO), based in Geneva, Switzerland, has established quality control guidelines known as the ISO 9000 standards. Many companies and organizations in Europe will buy only from ISO 9000 standard certified suppliers. This means that the suppliers must demonstrate to a certifying agency that:
A quality system is in use, and the system clearly defines an expected level of quality
The system is fully operational and is backed up with detailed documentation of quality control procedures.
The intended level of quality is being achieved on a sustained, consistent basis.
The key to receiving certification under the ISO 9000 standard is documentation. It’s one thing for a company to say that is has a quality control system in operation, but it’s quite a different thing to be able to document the steps in that system. Under ISO 9000, this documentation must be so detailed and precise that if all the employees in a company were suddenly replaced, the new employees could use the documentation to make the product exactly as it was made by the old employees. Even companies with good quality control system find that it takes up to two years of painstaking work to develop this detailed documentation. But companies often find that compiling this documentation results in improvements in their quality system.
The ISO 9000 has become an international measure of quality, Although the standards were developed to control the quality of goods sold in European countries, they have become widely accepted elsewhere as well. Companies in the United States that export to Europe often expect their own suppliers to comply with the ISO 9000 standards, since these exporters must document the quality of the materials going into their products as a part of their own ISO 9000 certification.
The ISO program for certification of quality management programs is not limited to manufacturing companies. The American Institute of Certified Public Accountants was the first professional membership organization in the United States to win recognition under an ISO certification program.
Real Business Example:
How ISO 9000 can Improve Quality:
Over the years, E. I. du Pont de Nemours & Company has been a leader in quality control systems. Despite this emphasis on quality, for many years the engineers at one of Du Pont’s plants were unable to control a high defect rate in the output from a press that makes plastic connectors for computers. As part of the documentation needed for certification under the ISO 9000 standards, workers on the press were required to detail in writing how they do their jobs. When engineers compared the workers’ notes, they fond that the workers were in consistent in the way they calibrated probes that measure press temperature. As a result, the press temperature were often set incorrectly. When this problem was corrected, the defect rate for the press fell from 30% to 8% of output.
You may also be interested in other useful articles from “cost terms, concepts and classifications” chapter:
- Manufacturing and Non-manufacturing Costs
- Product Costs Versus Period Costs
- Cost Classifications on Financial Statement
- Cost Classifications for Predicting Cost Behavior (Variable and Fixed cost)
- Mixed or Semi variable Cost
- Cost classification for Assigning Costs to Cost Objects (Direct and Indirect Cost)
- Decision making costs – cost classification for decision making
- Quality Costs
- Further Classification of Labor Costs
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