The concept of establishing goals and flowing them throughout an organization isn’t new in business or in quality management system standards. In ISO 9001:1994, the establishment of goals was done via the quality policy, following a review of effectiveness in meeting these management goals. QS-9000 took the concept further in defining the need for goals, which are driven from the business planning process and tied into the analysis and use of company level data along with the basic requirement. ISO 9001:2000 and ISO/TS 16949:2002, however, have taken the concept to a whole new level in terms of the definition, monitoring and communication of requirements throughout all relevant levels of the organization. Any discussion on ISO/TS 16949 should begin with a quick evaluation of the applicable requirements.

Requirements: The major applicable requirements related to goals and objectives are found in the following sub-elements of ISO/TS 16949.

• 5.4.1 and 5.4.1.1. Quality objectives—Require the establishment of quality objectives at relevant functions and levels within the organization and require that the objectives and measuresbe included in the business plan

• 5.1.1 Process efficiency—Requires management to review product realization and support processes for efficiency and effectiveness

• 5.3 Quality policy—Requires the provision of a framework for establishing and reviewing quality objectives

• 5.6 Management review—Requires management to review and monitor quality objectives as a means toward improved system performance, processes and satisfaction of customer requirements

• 6.2.2, 6.2.2.4 Training—Requires personnel to be aware of how they contribute to quality objectives and requires the company to measure this awareness

• 8.2.1. Customer satisfaction—Requires monitoring of specific data to determine customer satisfaction

While these are the major areas where the requirements for objectives exist, there’s an overlap with requirements for process monitoring, analysis of data and continual improvement.

Interaction: It’s important to know how the requirements fit together and how a company can ensure compliance using the process approach during internal and external audits.

It all begins with setting the business objectives and determining the measurable data that will be used to monitor these objectives’ performance. While ISO/TS 16949 allows for flexibility, it also directly defines a few required metrics, most specifically cost of poor quality (5.6.1.1), the measures related to customer satisfaction (8.2.1.1) and their corollary in supplier monitoring (7.4.3.2). A less direct definition, through 5.1.1, requires the monitoring of both effectiveness and efficiency measures for product realization and support processes. Product realization processes are defined in Section 7 of the specification (the old design, contract review, APQP, purchasing, process and calibration of QS-9000), whereas support processes enable the product realization processes to be implemented (e.g., training, document control).

Effectiveness and efficiency: Effectiveness and efficiencymeasures need to be defined for product realization support processes. Effectiveness is generally easy to cover, as people in the quality field are generally familiar with its indicators (e.g., audit results in an area, PPM, on-time delivery). Efficiency, however, may be a new concept to many organizations, particularly in the area of support processes. It’s a measure of the resources consumed to perform the task to a minimum expected level. For most companies, monitoring the efficiency of the production processes is already in place through measures such as value-added labor content or cost per move, but only a few companies have measures in place to determine the efficiency of their preventive maintenance or purchasing processes. As a company prepares for an upgrade or registration, it’s critical to identify what measures it currently has and whether these measures cover all product realization and support processes.

Implementation: Once the objectives and measures are determined, the next step is to determine their course in the organization. In many cases, there may be a flow directly from a customer objective (e.g., 25 ppm or 100 percent on-time delivery) through production. In other cases, the objective may be driven from the business plan. In either case, objectives should relate to the quality policy and truly support the quality policy objectives, which exist at the highest level of the organization, and cascade down to the departments (or processes) and finally to the individual.

Audit approach: During audits, it’s essential to ensure that top-level objectives, either established by the organization or mandated by the customer, are cascaded down throughout the organization to the processes and departments that comprise the system and then down to the individual. Although it’s possible that not every person will have a specific objective, most processes, according to 5.1.1, will have one. Through 6.2.2, the auditors attempt to confirm that people throughout the organization generally know and understand the objectives and have a specific idea of how each individual affects the objective. Via 6.2.2.4, it’s possible to confirm that a measure of this awareness exists.

Summary—using the data: In addition to all of the directly mapped references, there are related requirements for data analysis, corrective action and continual improvement. The requirements of these elements account for the use of data to form either actions for corrective measures (in cases of negative trends in data) or plans for continual improvement (in cases where the data shows that requirements are being met). In either case, these requirements, along with those found in management review, require some data to be used toward the overall improvement in the processes’ effectiveness and efficiency within the system.

The game has significantly changed from the days of tracking objectives from the quality policy to management review. The authors of the specification have embedded requirements that lead to an integrated implementation of process monitoring and measurement, with management oversight and requirements for action, which is a long way from ISO 9001:1994.