Back in the early 1990s, there was a saying, loudly heralded by one global registrar: “Certify your company, and the export markets will open their doors to it.” Well, the actual wording was a bit more rude, to get the message across to small companies.
I guess this slogan still holds true, looking at the figures registrars boisterously declare for their Far East markets. Pity that, when European Union citizens buy Chinese, Indian, Thai, Korean, or Taiwanese goods, they don’t care if the supplier manages a certified quality system—assuming that EU buyers even know what a management system certification is. They buy these goods mainly because they are cheaper, even though “cheap” they may look—and be.
This brings us to today’s debate: the downturn of the European Union’s certification market. According to the “The ISO Survey of Certifications—2010,” growth in European ISO 9001 certificates has dropped from a high of about 162,000 in 2004 to about 46,000 in 2010. Were it not for mandatory trends, the market growth in certifications here would be zero. Some registrars’ turnover grows at the expense of others’ losses, so the total number of certificates is barely growing.
This is particularly true for ISO 9001. More specific standards and specifications, such as ISO/TS 16949, ISO 14001, AS 9100, SA 8000, and BS OHSAS 18001, are growing at a faster rate, although not much faster. The reasons for this are various and change from company to company, but they can be boiled down to these three:
• “Dear supplier, either you certify your company according to X, or you won’t even receive a request for quotation from us.”
• Regional, and therefore governmental, funding. For example, coastal areas where there are money-making tourist resorts, and Tuscany, which holds the majority of SA 8000 certifications worldwide.
• Tax-reduction schemes. For example, certification to BS OHSAS 18001 means lower premiums for workers’ insurance.
However, all these certifications are mere appetizers; we could say that ISO 9001 certification, the main course, has yet to be served globally, at least in terms of the percentage of companies certified. And while we’re waiting for it to arrive, it’s looking increasingly meager. A stripped-down certificate might be efficient for management consultants, but it doesn’t do much for companies. Most of them still think of certification as a sort of driver’s license: What matters is that you have it; how you drive doesn’t even come into question.
But let’s put aside this not-so-trivial topic and concentrate instead on ISO 9001 certification. I’ll use Italy as a case study, although input and output can be adequately extrapolated to other countries.
Italy has a population of 60 million, almost 70 million if you include the fairly stable migrant population. There are half a dozen accreditation bodies—more or less one for each certification scheme—and some 60 accredited registrars, plus an undisclosed number of unaccredited registrars that nonetheless hold a market share.
Last but not least, given some 250,000 companies operating in Italy, only a few hundred operate with more than 50 employees.
Needless to say, Pareto’s 80–20 principle holds true here. For overall certification turnover, ISO 9001 enjoys the lion’s share of certifications, although that’s becoming unfortunately, though not unpredictably, smaller and smaller, year after year. The market seems to prefer product to system certification, I think because registrars never adequately explained to the market what system certification means. The certificates’ wording only helps a thick fog get thicker, emphasizing as it does the design, manufacture, and sales of “widgets” rather than the system as a whole.
Metaphorically speaking, ISO 9001 certification dipped below the lower control limit of the process run chart during the late 1990s, when company owners discovered, to their dismay, that certification to the standard did not help sales. ISO 9001:1994 was a virtual rewording of previous editions, apparently published just to keep the cash books of standardization bodies in the black.
The process approach seen in post-millennial editions of ISO 9001 could have been a breakthrough, had companies not grown tired by then of the unprofitable, continuous changes in each edition. Registrars didn’t help matters by demanding process mapping that resulted in companies either copying ISO 9001’s figures outright, or documenting organizational structures that weren’t their own, and were therefore totally useless to effective management.
What was warned of as a trend some 20 years ago has become a reality today: The certificate-cum-driver’s license is now a prerequisite for responding to customers’ requests for quotes. Certification has become not so much an indication of effective quality management as a way to keep from falling behind the competition.
ISO 9001 certification—let’s face it—has become more or less a byproduct of other, more tangible goals. For example: a fairly large company that manufactures master batches for plastics processing intends to register to ISO 9001. However, it has no structured system for implementing the mandatory requirements for how these batches should be added to plastics used for producing medical devices, food containers, or food-processing equipment. So what’s an ISO 9001 certification worth? And this company will surely get it, thanks to an enterprising registrar.
This begs the question of how we might develop a different market system for certification consultants and trainers. Young people entering the field will gravitate toward the more useful and promising certification schemes, but what about older consultants, closing in on retirement, often bored, and tired of studying and submitting themselves to all-too-obvious and nontechnical examinations?
Consultants must stop selling services aimed only at achieving certification. To survive, they must truly help customers understand and improve their management systems. Otherwise, suppliers will continue to treat certificates as driver’s licenses. They will assume they are capable drivers, yet they will run afoul of the requirements and rack up traffic tickets in the form of nonconformances. I don’t expect people to be perfect, but they can be educated, even if they don’t want to; we were all like this when we were kids.
Please don’t be misled by my Italian example. The issue of misused and underused certification applies to all countries. I’ve performed audits in Brazil, Croatia, the Czech Republic, Egypt, Germany, Ireland, Mexico, Poland, Slovakia, South Africa, Turkey, and the United States. In all of these, as well as in places I’ve not been but my fellow auditors have, ignoring the value of certification while profiting from poorly regulated, discounted goods from the Far East remains business as usual.