The Cost of Certification

A deterrent to system implementation?

Published: Monday, May 8, 2017 - 11:02

Certifications often drive the implementation of a system approach, based on ISO standards. The primary implementation demand is for ISO 9001. Certifications do have initial costs and then recurring costs for surveillance and recertification visits. This is a responsive approach to business requirements, invariably driven by a forthcoming contract that mandates the system approach. Prudent businesses appreciate the risk of not having a process-based system.

When budgets are tight, supply chains are challenging, and retaining employees is difficult, it is all the more essential that organizations invest in a good management system. As W. Edwards Deming said, “A bad system will let down a good person every time.”

An efficient management system should be an essential asset of any good organization. Certification should not be the primary driver of this requirement. The optimum return on investment is by effective process performance based on objective information analysis, which in turn is based on data from within the organization or an appreciation of inputs publicly available. Organizations’ leaders should look beyond certifications to implementing and maintaining systems that drive continual improvement. Continual improvement drives organizations to find cheaper and quicker solutions while improving the quality of their products and services. After all, is that not what customers expect? The best quality for the cheapest price point?

Organizations can, and should, consider the option of self-declaring their conformity to ISO 9001, without incurring the added expense of certification, especially when customer requirements do not mandate it. Meeting customer requirements, ensuring continual improvement, and leading the organization to innovate cannot be achieved without a system in place. Effectiveness and efficiency is achieved when employees use system processes to achieve objectives. Customers’ confidence in the organization comes from trusting that they will receive conforming products/services consistently. The cost of not following a system approach can lead to work performance that is not optimized and results in losses.

ISO 9001:2015 requires an appreciation of the context of the organization, as well as the risks and expectations of the interested parties. This enables the organization’s leaders—in fact, requires them in clause 5.1.1 b—to define quality policy and objectives for the quality management system (QMS) that is aligned to the strategic direction of the organization. The QMS now is not an add-on to the business strategy but is integrated with it.

Experience has repeatedly shown that the lack of customer focus is the major cause of businesses failing or not performing, of governmental agencies overshooting budgets, and sensitive organizations (e.g., nuclear facilities, military bases, hospitals) making fatal errors. The cost of not having a system is so high and the consequences so dangerous that it would be almost suicidal not to have a management system in place.

Once the decision to implement the system has been made, why reinvent the wheel? The well-tried, regularly updated ISO 9001 standard, which encompasses years of global wisdom, is the correct choice. Once the system is implemented and the organization’s leaders have confidence in the system’s performance based on objective inputs (such as audits, inspections, feedback, and other inputs), top management can self-declare the system as conforming to ISO 9001. There is no cost to this except the minor investment in using a competent consultant who comes in respecting the existing system and then identifies and addresses any gaps. After all, every functioning organization has a system.

The next stage, requiring investment in the certification, is a decision to be made by top management when a business requirement necessities this. When it does, then the work will pay for it.

About The Author

Inderjit Arora

Inderjit Arora is the President and CEO of Quality Management International Inc. (QMII). He serves as a team leader for consulting, advising, auditing, and training in management systems. He specializes in several ISO and industry specific standards. He is an Exemplar Global certified Lead Auditor and is on the US TAG-176 committee, and a member of the US Submarine League. IJ  is a popular speaker at several universities and forums on management systems, conflict management, crisis communication and leadership. Dr. Arora is a Master Mariner with an MBA from the College of William and Mary and additionally MSC in defense studies and graduation in nuclear sciences. He has a 32 year record of achievement in the military, mercantile marine, and civilian industries. He writes a blog and contributes to several professional magazines, including Quality Digest. His articles have been published in the USCG Proceedings.