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ISO 9001-2000 Certification comes free with your ERP purchase!

September 2006 - IAS Turkey

Zeynep Çalik - ERP ISO9001 Globalization and the accompanying technological and social changes have in turn led to changes in organizations. The change with the most far-reaching implication is the declaration of the customer as the king, and the resulting emphasis by businesses on re-orienting their organizations towards focus on the customer, in addition to their existing attention to products and profitability. In this context, the customer takes the center place in the current organizational model and is treated at the crux in the mechanism for all organizational decision-making. As businesses come to realize they no longer enjoy the generous profit margins of the past, they try to maximize and maintain customer satisfaction. The concept of customer satisfaction, defined as the gap between perceived quality and expectations, is essential for organizations targeting total quality management. The quality of the products and services offered to the customer is directly proportional to such attributes as the labor performed, the quality of the raw material used, and the productivity of the work force. To be able to offer the highest quality output to the customer at the most reasonable price point, carefully selected inputs need to be utilized, and the least costly and most effective processes need to be implemented. To achieve this objective, the inputs and processes have to be effectively monitored and analyzed. ISO 9001?2000 standards suite presents an integrated sum of standards that can be used to track inputs and processes, and in turn, allows the desired outputs to be obtained. At the heart of these standards is the idea of recording all business processes, and utilizing and analyzing them on demand.

One of the basic standards making up ISO 9001?2000 suite is the standard for "supplier evaluation". Supplier evaluation calls for pre-purchase assessment of suppliers on such criteria as quality, delivery date, price, delivery duration, due date, and execution of the purchase through the most suitable supplier. For example, if we have five suppliers as candidates for the purchase of goods or services, and we have made ten purchases from each over the previous three month period, there will be close to 250 separate criteria for us to evaluate. Considering that we would have to do this for all goods and services we purchase, there will be thousands of data points for us to query. We need a system that allows us to interrogate in real time information on purchase orders and agreements, expected and actual delivery dates of goods, quality control criteria used and associated analysis results, and delivery duration and price policies. Furthermore, we may want to be able to define evaluation methodology using custom metrics so that we can rank suppliers. If we turn around and look at the process from the point of the supplier, we see that the organization supplying the goods or services will have to evaluate its own performance on its end using the same criteria: whether it has made deliveries to the customer on time, the quality of the goods it has sent out, and its sales and price policies. To achieve these objectives, the supplier, among other things, has to be able to accurately perform capacity planning, obtain fault analysis reports, and use quality goods and skilled labor to produce products of unblemished quality.

"Corrective and preventive actions" is another one of the basic standards constituting the ISO 9001?2000 suite. The primary goal of the standard associated with corrective and preventive actions is to capture all data before and after a fault is discovered, and for all corrective and preventive actions to be applied. Again in this case, the number of data points that need to be queried is large and retrospective analysis is required. Information on when the fault took place, when it will be corrected, the department in charge, its priority, description, and status will need to be tracked.

A well-chosen ERP system will contain the infrastructure required to record and monitor the standards associated with ISO 9001?2000 suite. In fact, such an ERP system will already contain all of the data mentioned in the examples above. Indeed, an organization using ERP will adequately be satisfying the requirements for ISO 9001?2000 standards. Organizations would therefore be best advised to first decide on the ERP system they will be using and define their business processes; afterwards, they can commence on their plans related to their use of ISO standards. An organization having an effective ERP system in place only needs to define procedures and instructions in order to implement ISO compliance.

In organizations that are in the process of institutionalizing their business practices, compliance with ISO 9001-2000 has become a way of life, as opposed to being treated as only a certificate of quality. To effectively include ISO 9001-2000 in all business processes and to involve the work force in the same processes, a system must be in place. The enterprise resource planning system being used must be examined to gauge how well it meets the requirements of such a system. An ERP system that falls short of satisfying expectations related to ISO standards, and which is difficult to administer, will only serve as a cost burden to the organization.

Zeynep Çalik
Systems Senior Consultant
IAS Turkey

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