FOUNDATIONS OF QUALITY MANAGEMEN

CHAPTER 2

INEN 4315 Industrial Management

Berna Eren Tokgoz, PhD
Department of Industrial Engineering
Chapter 2

• ‘Pride and joy” in work –and its impact on quality- is one of

the foundations of the philosophy of Edward W. Deming.
• This chapter provides insight the quality philosophies of three
leaders which are Edward W. Deming, Joseph M. Juran and
Philip B. Crosby.
• We will examine their similarities and differences. In
addition, we will look at their individual contributions to
modern practice.
• We will look at other individuals’ contributions to quality
management.
• Totally, all contributions lead to establish the total quality
and the implementation of quality management systems,
such as ISO 9000.
Quality Profile – Texas Nameplate Company,
Inc.
• TNC manufacturers and sells identification and information
labels. It has more than 1000 costumers in the US and 9 in
foreign countries.
• It sharpened its corporate culture with its small size which
allows them to do communication, rapid decision-making and
accessible leaders. These are their competitive advantages.
• “Fear is useless; what is needed is trust.”
• They created a continuous learning environment that enables
empowered teams of workers to take charge of processes and to
deliver products and services with a “star quality.”
• Reduced its defects from 3.65 percent to about 1 percent in four
years.
• Satisfaction rates in five areas employees say are the most
important exceed national norms by a significant margin.
 Quality Profile: MEDRAD
• MEDRAD has been committed to improving patient outcomes by
developing, marketing, and servicing innovative, cost efficient
medical imaging and other devices for diagnosing and treating
diseases.
• Company has created an environment of distributed decision making
in support of a culture of high performance.
• Systematic approaches to capture customers’ expectations and
preferences.
• The Customer Complaint Process focuses on timely response and
successful resolution of customer issues
• MEDRAD’s overall Net Promoter (NP) scores (a loyalty metric defined
by the level of repeat sales and referrals) have been consistently 60
percent or higher, compared to the 50 percent or higher marks for
other organizations over the same time periods.
Leaders in the Quality Revolution

• W. Edwards Deming
• Joseph M. Juran
• Philip B. Crosby

• Armand V. Feigenbaum
• Kaoru Ishikawa
Deming Philosophy
• Unlike other management gurus and consultants,
Deming never defined or described quality precisely.
• In Deming’s view, variation is the main driver of poor
quality.
• The Deming philosophy focuses on continual
improvements in product and service quality by reducing
uncertainty and variability in design, manufacturing, and
service processes, driven by the leadership of top
management.
• He believed that never-ending cycle of continuous
improvement has to be supported by statistical analysis.
 Deming Chain Reaction

Improve quality
Less rework,
Costs decrease fewer mistakes,
fewer delays,
Productivity improves better use of
time and
Increase market share with better materials
quality and lower prices

Stay in business

Provide jobs and more jobs

Deming stressed that top management must assume the overriding responsibility for
quality improvement
Deming’s 14 Points

• At the time of his era (1960’s and 1970’s) manufacturing is

driven by quotas and strict work measurement with
uncooperative relationship between labor and
management.
• Many organizations were ruled by autocratic managers who
had little interest in listening to costumers, engaging the
workforce, or improving quality.
• Deming proposed his 14 points to achieve quality
excellence.
• Of course today management practices are different but 14
points still gives important insights and provide guidance
for managing effective organizations.
Deming’s 14 Points (Abridged) (1 of 4)

1. Create and publish a company mission statement and commit to it

• Do not simply think profit
• Invest in innovation, education, and training----CREATE LONG TEM VIEW
• Take responsibility to create jobs and improve company’s competitive position as top
managers
• Even though, managers know what needs to be changed, they are some form of in
denial “ We can’t be that bad”
2. Learn the new philosophy
• In order to survive, companies have to adapt customer-driven approach to quality.
• Both people and organizations should be constantly renew themselves to learn new
approaches and relearn many older ones.
3. Understand the purpose of inspection
• Deming encouraged workers to take responsibility of their work. He emphasize the
importance of in-process inspection and the use of statistical tools that would help to
eliminate post-production inspection.
• Inspection should be used as an information-gathering tool for improvement
• However, few managers truly understand variation.
Deming’s 14 Points (Abridged) (2 of 4)

4. End business practices driven by price alone

• Deming urged businesses to establish long-term relationships
with few suppliers, leading loyalty and opportunities for mutual
improvement.
• “Price has no meaning without quality”---Shewhart
5. Constantly improve system of production and service
• Improvement of design and good comes from understanding
customer needs and continual market surveys and other source
of feedback.
• Continuous improvement is necessary for surviving in a highly
competitive and global business environment,
6. Institute training
• Not only for improvement of quality and productivity, for also
worker’s morale.
Deming’s 14 Points (3 of 4)

7. Teach and institute leadership

• One of the biggest obstacle of improvement is lack of leadership
• The job of management is not supervision it is leadership.
• Supervision is more about overseeing and directing work on the other hand leadership
is providing guidance and eliminate fear and encourage teamwork.

8. Drive out fear and create trust.

• Workers afraid of reporting quality problems, managers are also afraid of to cooperate
with other departments
• Creating a culture without fear is a slow process

9. Optimize team and individual efforts

• Internal competition for raises and performance ratings inhibits teamwork and
cooperation.

10. Eliminate exhortations for workforce

• A well-designed system that provides workers with the right tools and environment will
lead to higher levels of trust and motivation than slogans and goals can achieve.
Deming’s 14 Points (4 of 4)

11. Eliminate numerical quotas and Management by objective. Focus on

improvement
• Deming acknowledge that goals are useful but meaningless without incorporating a method to
reach the goal (Example: let’s increase our sales by 5%, decrease our cost by 10%)

12. Remove barriers that rob people of pride of workmanship

• Effective organizations need to understand the factors that motivate and engage workers and
build an environment in which workers take pride in what they do, understand the meaning of
their work, and are rewarded for their accomplishments.

13. Encourage education and self-improvement

• This point refers to continuing, broad education for self development.
• Organizations must invest in their people at all levels to ensure success in the long term.

14. Take action to accomplish the transformation

• It is very hard to make chances. Changing organizational culture generally meets with skepticism
and resistance that many firms find difficult to deal with.

www.deming.org
Criticism of Deming’s 14 Points

• Many people criticized Deming’s principle because it is

not giving specific direction to say managers “how to do
it”.
• It did not fit into the traditional American business
culture.
• It is just a philosophy.
• Deming always stated that “There is no instant pudding”
• Quality excellence takes learning, hard work, and
dedication, many are unwilling to make the commitment.
• However, many companies used Deming’s principle with
great success.
Quality Spotlight: Hillerich & Bradsby Co.

• They producing baseball bat since 1884 but in mid 1980’s

they faced a very big challenges from market changes and
competition.
• Company CEO took four-day Deming seminar. He also
insisted that union officials had to take Deming seminar.
• They implemented several Deming’s principles such as
elimination work quotes. They established team-based
approach.
• Overall productivity improved
• Company focused on training and education
• Today, the Deming philosophy is still the core of Hillerich
& Bradsby Company's guiding principles
Deming’s System of Profound Knowledge

To eliminate some confusion and misunderstanding,

Deming provided the underlying foundations of the
14 points which can be stated in four elements:
• Appreciation for a system
• Understanding variation
• Theory of knowledge
• Psychology
Systems
• System can be defined as a set of functions or activities within an
organization that work together for the aim of the organization.
• Most organizational processes are cross-functional
• Parts of a system must work together
• Every system must have a purpose
• Management must optimize the system as a whole
• Think about a McDonald’s restaurant. It is a system that includes several
subsystems
• order-taker/cashier, grill and food preparation, drive-through, order
fulfillment
• these subsystems are linked together as internal customers and suppliers.
• Think about an organization. It is composed of many individual functions
which are cross-functional.

To manage any system, managers must understand the interrelationships

among the system’s components and among the stakeholders who are
involved.
Variation
• Many sources of uncontrollable variation exist in any process
• Excessive variation results in product failures, unhappy
customers, and unnecessary costs
• Statistical methods can be used to identify and quantify
variation to help understand it and lead to improvements
• Modern technology has improved to reduce variation but, the
variation can also come from human behavior.
• Therefore, Deming suggested that management first
understand, and then work to reduce variation through
improvements in
• technology,
• process design, and
• training.
Theory of Knowledge
• Knowledge is not possible without theory-
• You can apply statistical formula or you can use Microsoft Excel data analysis tool
but if you do not know how to use it appropriately, results could be very wrong.
• Copying an example of success, without understanding it with theory, may lead to
disaster

• Experience alone does not establish a theory, it only describes-it

cannot be tested or validated- think why very experienced people try
to get their masters or Ph.D. degrees?
• Theory shows cause-and-effect relationships that can be used for
prediction
• Deming never wanted to give a recipe to managers to achieve quality.
Instead, he wanted them to learn and discover what works and what
is appropriate for their individual organizations.
Psychology
• People are motivated intrinsically and
extrinsically; intrinsic motivation is the most
powerful
• Intrinsic motivation refers to behavior that is driven by internal
rewards. In other words, the motivation to engage in a behavior
arises from within the individual because it is intrinsically
rewarding.
• Extrinsic motivation refers to behavior that is driven by external
rewards such as money, fame, grades, and praise.
• Deming’s controversial belief’s is: Pay is not a motivator. 

• Fear is demotivating--- it prevents people from

reaching their full potential.
• Managers should develop pride and joy in work
Impacts of Profound Knowledge

• When people don’t understand systems, they basically don’t

understand that incidents, interventions, and control are the
net result of many actions and interdependent forces.
• When people don't understand variation, they don’t
understand the difference between prediction, forecasting,
and guesswork, thus being unable to distinguish between fact
and opinion.
• When people don’t understand psychology, they don’t
understand motivation or why people do what they do, which
causes them to misunderstand change and resistance to it.
• When people don’t understand the theory of knowledge, they
don’t know how to plan, accomplish learning, improve, change,
or solve problems, despite their best efforts.
Joseph Juran
• He pioneered in the development of statistical methods for
quality
• He wrote a book “Quality Control Handbook”
• He taught quality principles to the Japanese in 1950s
• Some steps taken by Japanese organizations as a result of
Juran’s leadership were:
• Directing quality from the senior management level
• Training the entire management hierarchy in quality principles
• Striving to improve quality at a revolutionary rate
• Reporting progress on quality goals to executive levels
• Involving the workforce in quality
• Revisiting the reward and recognition structure to include
quality.
Juran Philosophy
• Both Deming and Juran believed that the solution of to quality crises depend on
new thinking about quality that includes all levels of the managerial hierarchy.
• They are thinking that upper management requires training and experience in
managing for quality.
• Juran did not propose a major cultural change in the organization. His program
designed to fit a company’s strategic business planning.
• Unlike Deming (statistics should be the common language), he argued that
employees at different levels of an organization speak in their own languages.
• Juran focused on increasing conformance to specifications through elimination
of defects, supported by statistical tools for analysis.
• Juran proposed a simple definition of quality: “fitness for use.” This definition of
quality suggests that it should be viewed from both external and internal
perspectives; that is, quality is related to “
(1) product performance that results in customer satisfaction;
(2) freedom from product deficiencies, which avoids customer dissatisfaction.
Juran’s Quality Trilogy

Juran’s perspective focus on three major quality

processes:
• Quality planning--- the process of preparing to
meet quality goals.
• Quality control--- the process of meeting
quality goals during operations.
• Quality improvement--- the process of breaking
through to unprecedented levels of
performance.
Juran’s Breakthrough Sequence
Unlike Deming, Juran specified a detailed program for quality improvement and called it
breakthrough sequence:

• Proof of the Need -- managers need to be convinced that quality improvements are
simply good economics.
• Project Identification -- all breakthroughs are achieved project-by-project.
• Organization for Breakthrough --organization for improvement requires a clear
responsibility for guiding the project.
• Diagnostic Journey -- Diagnosticians skilled in data collection, statistics, and other
problem-solving tools are needed at this stage.
• Remedial Journey -- choosing an alternative that optimizes total cost, implementing
remedial action, and dealing with resistance to change.
• Holding the Gains -- This step involves establishing the new standards and procedures,
training the workforce, and instituting controls to make sure that the breakthrough
does not die over time.

Juran believed that Deming was wrong to tell management to drive out fear; he noted:
“Fear can bring out the best in people”
Crosby Philosophy

“Quality is free . . .
... It’s not a gift, but it is free. What costs money are the
unquality things -- all the actions that involve not doing
jobs right the first time.”
Crosby’s Absolutes of Quality Management
• Quality means conformance to requirements (manufacturing perspective)
• Problems are functional in nature
• There is no optimum level of defects
• Cost of quality is the only useful measurement
• Zero defects is the only performance standard

Crosby’s approach to quality was primarily behavioral and emphasized

management and organizational processes to chance corporate culture and
attitudes rather than statistical techniques and improvement methodologies. Like
Juran his approach fit well within existing organizational structures.
Crosby believed that most of the human errors come from lack of attention
rather than lack of knowledge. However, Juran and Deming believed that despite
workers’ good intentions, the majority of the quality problems stem not from
human error, but from poorly designed systems that are the responsibility of
management.
A.V. Feigenbaum

• Quality is a strategic business tool

• Popularized the term “hidden factory”---portion
of plant capacity wasted due to poor quality
• Three Steps to Quality
• Quality Leadership, with a strong focus on planning
• Modern Quality Technology, involving the entire
work force
• Organizational Commitment, supported by
continuous training and motivation
Kaoru Ishikawa

• Instrumental in developing Japanese quality

strategy
• Influenced participative approaches involving all
workers
• Advocated the use of simple visual tools and
statistical techniques
• Dr. Ishikawa is best known for developing a
popular quality improvement tool called a cause-
and-effect diagram, which often bears his name.
Total Quality

• Principles – foundation of the philosophy

• Practices – activities by which principles are
implemented
• Techniques – tools and approaches to make
practices effective
Core Quality Management Principles

• Customer focus
• “Market out” vs “market in”
• Teamwork
• Continuous improvement
ISO 9000:2000 Quality Management Principles
As the quality discipline evolved, the principles that define modern
quality management have evolved too. In addition to core principles
following core principals are vital:

• Customer Focus
• Leadership
• Involvement of People
• Process Approach
• System Approach to Management
• Continual Improvement
• Factual Approach to Decision Making
• Mutually Beneficial Supplier Relationships
Quality Management Practices

• These practices represent the approaches that

organizations use to achieve the principles.
Customer Focus Practices

• Researching and understanding customer needs and

expectations.
• Ensuring that the objectives of the organization are linked
to customer needs and expectations.
• Communicating customer needs and expectations
throughout the organization.
• Measuring customer satisfaction and acting on the results.
• Systematically managing customer relationships.
• Ensuring a balanced approach between satisfying
customers and other interested parties (such as owners,
employees, suppliers, financiers, local communities and
society as a whole).
Leadership Practices

• Considering the needs of all interested parties including

customers, owners, employees, suppliers, financiers, local
communities and society as a whole.
• Establishing a clear vision of the organization’s future.
• Setting challenging goals and targets.
• Creating and sustaining shared values, fairness and ethical
role models at all levels of the organization.
• Establishing trust and eliminating fear.
• Providing people with the required resources, training and
freedom to act with responsibility and accountability.
• Inspiring, encouraging, and recognizing people’s
contributions.
Involvement of People Practices

• People understanding the importance of their contribution

and role in the organization.
• People identifying constraints to their performance.
• People accepting ownership of problems and their
responsibility for solving them.
• People evaluating their performance against their
personal goals and objectives.
• People actively seeking opportunities to enhance their
competence, knowledge, and experience.
• People freely sharing knowledge and experience.
• People openly discussing problems and issues.
Process Approach Practices

• Systematically defining the activities necessary to obtain a

desired result.
• Establishing clear responsibility and accountability for
managing key activities.
• Analyzing and measuring of the capability of key activities.
• Identifying the interfaces of key activities within and
between the functions of the organization.
• Focusing on the factors such as resources, methods, and
materials that will improve key activities of the
organization.
• Evaluating risks, consequences, and impacts of activities on
customers, suppliers, and other interested parties.
System Approach to Management Practices

• Structuring a system to achieve the organization’s objectives in the

most effective and efficient way.
• Understanding the interdependencies between the processes of the
system.
• Structured approaches that harmonize and integrate processes.
• Providing a better understanding of the roles and responsibilities
necessary for achieving common objectives and thereby reducing cross-
functional barriers.
• Understanding organizational capabilities and establishing resource
constraints prior to action.
• Targeting and defining how specific activities within a system should
operate.
• Continually improving the system through measurement and evaluation.
Continual Improvement Practices

• Employing a consistent organization-wide approach to

continual improvement of the organization’s performance.
• Providing people with training in the methods and tools of
continual improvement.
• Making continual improvement of products, processes, and
systems an objective for every individual in the
organization.
• Establishing goals to guide, and measures to track,
continual improvement.
• Recognizing and acknowledging improvements.
Factual Approach to Decision Making Practices

• Ensuring that data and information are

sufficiently accurate and reliable.
• Making data accessible to those who need it.
• Analyzing data and information using valid
methods.
• Making decisions and taking action based on
factual analysis, balanced with experience and
intuition.
Mutually Beneficial Supplier Relationships
Practices

• Establishing relationships that balance short-term gains

with long-term considerations.
• Pooling of expertise and resources with partners.
• Identifying and selecting key suppliers.
• Clear and open communication.
• Sharing information and future plans.
• Establishing joint development and improvement
activities.
• Inspiring, encouraging, and recognizing improvements
and achievements by suppliers.
Total Quality Techniques

• Techniques include a wide variety of tools to plan

work activities, collect data, analyze results,
monitor progress, and solve problems.
• Statistical methods
• Visual aids for problem solving, such as flowcharts
• Techniques specific to quality assurance activities,
such as control charts, measurement systems analysis,
reliability models, and so on.
Variation and Statistical Thinking

• Managers do not think statistically, they think

basically based on one data or two data points.
• Statistical thinking is a philosophy of learning
and action based on these principles:
• All work occurs in a system of interconnected
processes
• Variation exists in all processes
• Understanding and reducing variation are the keys
to success
Sources of Variation in Production Processes

Measurement
Operators Methods
Materials Instruments

INPUTS PROCESS OUTPUTS

Tools Human
Machines Environment Inspection
Performance
Problems Created by Variation

• Variation increases unpredictability.

• Variation reduces capacity utilization.
• Variation contributes to a “bullwhip” effect.
• Variation makes it difficult to find root causes.
• Variation makes it difficult to detect potential
problems early.
Types of Variation
• Uncontrollable variation (Common causes) are a natural part of a
process:
 This is a result of the design of the product and production system.
 Common cause variation can only be reduced if the product is redesigned, or if
better technology or training is provided for the production process.
 Wilson Sporting Goods golf balls
• Special (assignable) causes of variation can be recognized and
controlled
 This arises from external sources that are not inherent in the process.
 It can be detectable by using statistical techniques and are usually economical to
correct.
 Common factors that lead to special causes are
 A bad batch of a material from supplier
 A poorly trained substitute machine operator
 A broken or worn tool
 Miscalibration of measuring instruments

• Failure to understand these differences can increase variation in a

system
Two Fundamental Management Mistakes

1. Treating as a special cause any fault, complaint, mistake,

breakdown, accident or shortage when it actually is due to
common causes -tampering with a stable system can increase
the variation in the system
2. Attributing to common causes any fault, complaint, mistake,
breakdown, accident or shortage when it actually is due to a
special cause – the opportunity to reduce variation is
mistakenly assumed to be uncontrollable
Deming’s Red Bead Experiment – Round 1
• A foreman (Usually Deming), six workers, a recorder, two inspector and chief
inspector.
• Materials are 3200 white beads, 800 red beads.
• Two tupperware boxes, one is little smaller than the other.
• A paddle with 50 holes or depressions used to scoop up 50 holes.
• Company producing white beads and customer does not buy red beads
Deming’s Red Bead Experiment – Round 2
• Foreman announces that management set the goal of no more than 7 red beads
Deming’s Red Bead Experiment – Round 3
• Foreman announces that management set the goal of zero defect.
• The zero defect day did not improve quality.
• Costs are getting out of control and they were talking about the
shutting down the entire plant.
• Dave and Tom received pink slips saying that tomorrow will be their
last day.
Deming’s Red Bead Experiment – Round 4
• However, foreman is optimistic he posts a poster “Be a quality
worker”
• At the end of the fourth day, the production is still bad.
• Foreman announces that management has decided to close
the plant after all.
Control Chart of Results

• Variation exists in systems and, if

stable, can be predicted. The
variation arises from common
causes.
• All the variation in the production of
read beads, and the variation from
day to day of any worker, came
entirely from the process itself.
• Numerical goals are often
meaningless.
• Management is responsible for the
system.
Lessons Learned

• Quality is made at the top.

• Rigid procedures are not enough.
• People are not always the main source of
variability.
• Numerical goals are often meaningless.
• Inspection is expensive and does not improve
quality.
Illustration of Funnel Rules
Deming’s Funnel Experiment
Its purpose is to show that people can and do affect the outcomes
of many processes and create unwanted variation by “tampering”
with the process, or indiscriminately trying to remove common
causes of variation.
• Rule 1: Leave the funnel alone. However many people believe
they can improve the results by adjusting the location of the
funnel.
• Rule 2. Measure the deviation from the point at which the marble
comes to rest and the target. Move the funnel an equal distance in
the opposite direction from its current position.
• Rule 3. Measure the deviation from the point at which the marble
comes to rest and the target. Set the funnel an equal distance in
the opposite direction of the error from the target.
• Rule 4. Place the funnel over the spot where the marble last came
to rest.
Simulated Results of Funnel Experiment

• Leave the funnel alone results in

the least variation
• People use these rules
inappropriately all the time,
causing more variation than
would normally occur.
Quality Management Systems
Organizations need a structured and systematic approach to implement the principles,
practices, and techniques of total quality.
• Quality Management System (QMS) - a mechanism for managing and continuously
improving core processes to "achieve maximum customer satisfaction at the lowest
overall cost to the organization.”
• Objectives
• Higher product conformity and less variation.
• Fewer defects, waste, rework, and human error.
• Improved productivity, efficiency, and effectiveness.
• One of the first things to do is to establish a quality policy which is a formal document
that demonstrates a commitment to achieving high quality and meeting customer
expectations.
• Next, management must establish an organizational structure for its QMS that includes
responsibilities, methods of communication, maintenance of essential records and
documentation, and procedures for reviewing performance.
• Management must also identify and provide appropriate resources to achieve the
objectives. These resources might include people with special skills, training, workspaces,
manufacturing equipment, inspection technology, computer software, and the supporting
work environment.
Quality Manual
• A permanent reference for implementing and maintaining the
system.
• Typical records
• inspection reports
• test data
• audit reports
• calibration data

• Other documents, such as drawings, specifications, inspection

procedures and instructions, work instructions, and operation
sheets are vital to achieving quality and should likewise be
controlled.
• Finally, the system needs to be maintained and keep up to date.
• Many ways exist to structure QMS, but many organizations start
with the ISO 9000 family standards, which are a set of standards
and guidelines for quality management systems that represents
an international consequences on good quality management
practices.
ISO 9000 Family of Standards
• Terms such as quality management, quality control, quality system, and
quality assurance caused sometimes conflicting meanings from country to
country, within a country, and even within an industry.
• International Organization for Standardization (IOS) founded in 1946 in
Europe.
• A series of written quality standards have been developed with the
participation of 91 nations in 1987.
• The IOS took a unique approach in adopting the “ISO” prefix in naming the
standards.
• ISO is a specific tem for equal (as in isotherm lines on a weather map, which
show equal temperature).
• The intent was to ensure that organizations certified under the ISO 9000
standards have quality equal to their peers.
• The standards are recognized throughout the world.
• Meeting these standards became a requirement for international business.
 ISO 9000:2000 Objectives (New Version
ISO 9000:2005 revisited in 2015)
• The standards were revised in 1994 and consisted of 20 fundamental elements of a basic quality
system that included such things as management responsibility, design control, purchasing,
product identification and traceability, process control, inspection and testing, corrective and
preventive action, internal quality audits, training and statistical thinking.
• The standards were intended to meet five objectives:
1. Achieve, maintain, and seek to continuously improve product quality (including services)
in relationship to requirements.
2. Improve the quality of operations to continually meet customers’ and stakeholders’
stated and implied needs.
3. Provide confidence to internal management and other employees that quality
requirements are being fulfilled and that improvement is taking place.
4. Provide confidence to customers and other stakeholders that quality requirements are
being achieved in the delivered product.
5. Provide confidence that quality system requirements are fulfilled.
• The European Union realized that companies were more concerned with “passing a test” than on
focusing their energies on quality processes and improvement.
• In response, IOS revisited the standards in 2000.
• In 2008, an amendment to the standards was released, designed to clarify some of the language
and concepts, and improve compatibility with ISO 14001: 2004, the popular environmental
standard.
ISO 9000:2000 Documents

The standards are very generic and indented to apply to any organization,
regardless of type, size, or products provided.

The standards consist of three documents:

1. ISO 9000:2005—Fundamentals and vocabulary: This document provides
fundamental background information and establishes definitions of key terms
used in the standards.

2. ISO 9001:2015—Requirements: This is the core document that provides

the specific requirements for a quality management system to help
organizations consistently provide products that meet customer and other
regulatory requirements.

3. ISO 9004:2009—Guidelines for Performance Improvements: This document

provides guidelines to assist organizations in improving and sustaining their
quality management systems.
ISO 9001:2008 (Now ISO 9001:2015)
This requirements provide a structure for a basic quality assurance
system:
• Management Responsibility addresses what top management
must do to ensure an effective quality system.
• Resource Management ensures that an organization provides
sufficient people, facilities, and training resources.
• Product Realization refers to controlling the production/service
process from receipt of an order or quote through design,
materials procurement, manufacturing or service delivery,
distribution, and subsequent field service.
• Measurement, Analysis, and Improvement focuses on control
procedures for assuring quality in products and processes, analysis
of quality-related data, and correction, prevention, and
improvement planning activities.
Benefits of ISO 9000

• It provides discipline. The ISO 9001 requirement for

audits forces an organization to review its quality
system on a routine basis.
• It contains the basics of a good quality system.
These include understanding customer requirements,
ensuring the ability to meet them, ensuring people
resources capable of doing the work that affects
quality, ensuring physical resources and support
services needed to meet product requirements, and
ensuring that problems are identified and corrected.
• It offers a marketing program. ISO certified
organizations can use their status to differentiate
themselves in the eyes of customers.
Benefits of ISO 9000 - Examples
• Many diverse organizations have realized significant benefits from ISO 9000 that
range from higher customer satisfaction and retention, better quality products,
improved productivity, and decreased costs.
• In addition, organizations have found that using ISO 9000 resulted in increased
use of data as a business management tool, increased management commitment,
more efficient management reviews, and improved customer communication.
• At DuPont, ISO 9000 has been credited with increasing on time delivery from
70% to 90%, decreasing cycle time from 15 days to 1.5 days, increasing first-
pass yields from 72% to 92%, and reducing the number of test procedures by
one-third.
• Sun Microsystems’ Milpitas plant was certified in 1992, and managers believe
that it helped deliver important quality and service to customers.
• Toronto Plastic Ltd., reduced defects from 150,000 per million to 15,000 per
million after one year of ISO implementation.
• Delcor-homes, the first home builder to achieve registration, reduced its rate
for correctable defects from 27.4 to 1.7 in two years and improved its building
experience approval rating from the mid-60s to the mid-90s.