Using Internal Audits as an Efficiency Improvement Tool

How one company makes good use of co-auditors

Published: Tuesday, November 5, 2013 - 11:40

Every quality manager is familiar with internal audits, a systemic check of all company departments to verify that they are following established procedures. Most department heads are also familiar with internal audits. But there is often a big difference between how quality managers and department heads view the process.

Quality managers often function as the internal auditor. In that capacity they check that all established rules are known by employees and are followed during daily work practice. Department heads or other managers, on the other hand, usually are the auditees. They are on the receiving end of the audit, so to speak.

In my experience, it isn’t rare to see a lot of tension between auditors and auditees. During an audit, department heads often feel they are going up against the audit police and must fight to show that all operations are being performed according to the standard, and that there are no deviations. The internal auditor on the other hand might be disappointed that no discrepancies were found. After all, isn’t it his job to find something wrong?

If the company is in the early stages of implementing a quality management system or an integrated management system, the policing type of audit procedure described above may be OK. Meaning, despite the tension, the audit process works and provides value to the company in shaping its quality management system.

Many companies, however, have reached a more stable phase concerning the quality management requirements and have already made adjustments and optimizations in their management systems. In that case, all parties involved in an internal audit tend to be dissatisfied with the audit process. But they have to cope with it, they think, because it’s a requirement of ISO 9001 or whatever standard they are working under. But is it really necessary to perform internal audits only in this way?

Another solution

In my opinion it is not. All internal audits of quality management systems standards such as ISO 9001, ISO 17025, and so forth require comprehensive internal checks to verify that the management system is working properly and effectively. But why not check if it’s also efficient?

“Hang on,” you might say, “It is not the job of internal audits to check the efficiency of the quality system.”

Why not? What about organizing internal audits in a different way so that efficiency is also reviewed?

I know a company in Europe that has been following a new way of performing internal audits for many years. In this company the general manager was interested in creating a useful quality management system for a small firm using the guidelines of ISO 9004. Certification was seen only as a byproduct; the main goal was to efficiently organize the company, covering all departments, not just those involved in product manufacturing.

One day the general manager indicated that he wanted to have every employee act as an internal auditor from time to time. Years later he had not fully reached his goal, but many members of management and most technicians have acted as internal auditors at some point. How was that possible?

Internal auditors have to be trained in rather expensive training courses to gain the necessary skills and to fulfill the formal requirements to do a proper job. In that European company, about five interested people, who also had many years of work experience, passed the training and official tests to be able to act as internal auditors. These employees were not only from the quality management staff but also from purchasing, production, product development, and other departments. These were officially trained employees who would perform internal audits as lead auditors.

However, every other employee in the company can apply to join the audit team as so-called co-auditors. For them it’s not necessary to have education and training as an internal auditor. It is only their duty to study all the relevant regulations of the management system that are valid for the department in question prior the internal audit.

In this arrangement, the lead auditor is responsible for checking the established rules according to ISO 9001, for instance, and to decide if nonconformities occur, not unlike the typical type of auditing described above. However, the co-auditor’s task is to assess the procedures used in her colleagues’ departments, and to highlight positive and efficient processes. In that way, co-auditors learn a lot about other departments’ procedures and gain a much better understanding of how to work together. Auditees are always happy to show the audit team that effective and useful quality management system regulations are being implemented, and that they are being followed efficiently within their department.

Of course, audits often find nonconformities that must be addressed. But often, lead auditors or co-auditors might spot problems that are not nonconformities in the sense of not fulfilling the standard. Rather, these are areas for further improvement of procedures and workflows. Such observations are recorded in the audit report as opportunities for improvement. It is up to the department head to follow the suggestions or not.

Internal audit: An efficient improvement tool

Using this alternative procedure, internal audits usually cause no tension but rather a positive corporate culture of working together and finding improvements for workflows in all departments.

Before the audit it is common that auditees want the lead auditor to ask colleagues from specific departments to join the audit team as co-auditors. Many auditees want to show to potential unsatisfied “internal customers” how the procedures of the department have been running in detail.

During this process the co-auditor from the other department might ask uncomfortable questions, but in a collegial way that motivates the department head to set improvements in place. Remember, during a future internal audit, it might be this department head’s turn to assess the other department as co-auditor. In this way, an internal audit becomes a kind of internal training for better understanding on how to work together.

Here is an example of an improvement that came out of an internal audit at this company some time ago.

From time to time errors occurred in delivering wrong parts to the customer, and nobody could find the root cause in spite of looking very hard.

A colleague from the sales department acted as co-auditor at the internal audit of the materials management department. It took him only a few questions to discover that it was quite easy to misunderstand different database entries used in sales and materials management. His suggestion in the audit report enabled the department head of materials management to fix the issue completely.

Running this kind of internal audit for many years, the management is still happy with its unique way of performing internal audits as an efficient quality-improvement tool. Internal audits have become a highly accepted and efficient optimizing tool. Of course, this is now a part of the company’s quality management system.

About The Author

Gottfried Giritzer

Throughout his career, Gottfried Giritzer has continued to further his education while working full time by completing numerous training courses. He has become an accomplished quality engineer, quality manager, an ISO-certification auditor,  a microprocessor programmer, an expert logistician, an enterprise resource program administrator, and a project manager. He has also completed various IT training courses. He spent 13 years as the head of the IT department at an industrial firm in addition to his position as a quality manager, a profession he continues to practice. Giritzer is the author of the book Positive Quality Management for a Change (Books on Demand, 2013).