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Two Steps Beyond
the Baseline

Adapting your quality system to comply with the "cost of quality" and "voice of the customer" offers many benefits.

by James Mroz

Does your company understand what "cost of quality" means? Are you familiar with the "voice of the customer" concept? I must admit that when I first heard the phrases last spring, these were new concepts to me -- as far as quality system standards go. Yet the QS-9000 Task Force is considering both concepts for inclusion in the next edition of QS-9000.

As a result, I tried to learn more about these additions' inspiration: the German automotive quality standard, Verband Der Automobilindustrie E.V. (VDA) 6.1. Whether or not the next edition of QS-9000 contains requirements based on these concepts, the benefits they generate make their addition to your quality system worthwhile. They come from an excellent source: ISO 9004-1. By looking at what VDA 6.1 adopted from ISO 9004-1, you can zero in on the more important quality system additions that will benefit companies already registered to ISO 9001 and/or QS-9000.

ISO Technical Committee 176 will be meeting in Rio de Janeiro next month. At that meeting, a working group within TC 176 will begin a process that, by June 1998, is expected to result in first committee drafts for the revision of ISO 9001 and ISO 9004-1. ISO 9004:2000 will continue to provide guidelines for quality management system development that goes beyond the baseline of ISO 9001, including the basis for VDA 6.1's "Cost of Quality" and "Voice of the Customer."

However, TC 176's working group is expected to add guidance to ISO 9004-1 from other ISO 9000 standards that is valuable but is not practical to have in separate standards. This "beefing up" of ISO 9004-1, in order for it to serve as a partner to ISO 9001 and form a "consistent pair," is meant to encourage the use of ISO 9004-1. ISO 9001 sets minimum requirements that every company should have, while ISO 9004-1 offers opportunities to do more.

Despite the fact that ISO 9004-1 already offers a great deal of guidance in areas that are important to a good quality program, only the German automotive industry has, until now, used ISO 9004-1 extensively in creating its quality standard. Although other additions may follow, the two elements that QS-9000 is expected to include in the future were added to VDA 6.1 to bring commercial aspects to the quality management system through additional requirements from ISO 9004-1, according to Lothar Winterhalder. He is managing director of DEKRA Certification Services GmbH in Stuttgart, Germany, one of the first registrars accredited by VDA to conduct registration audits of automotive suppliers to VDA 6.1.

     Winterhalder explains how the "cost of quality" and "voice of the customer" are defined when it comes to VDA 6.1. "There are actually two 'costs of quality,' " he notes. "The first consists of costs derived from quality activities to assure the quality of the processes and resulting products -- for example, testing and planning costs. The second consists of costs resulting from failure to assure quality -- such as expenses when nonconforming product occurs and must be scrapped or reworked, or when mistakes happen, requiring the system to be fixed. Companies registered to VDA 6.1 have to show the costs for their quality management system and document the costs related to products of bad quality."

The "voice of the customer" requires your company to implement procedures so that you hear about the customer's satisfaction and collect information about it with your products and/or services, explains Winterhalder. He also emphasizes that DEKRA's present clients do not have trouble complying with these two requirements -- and they see benefits in satisfying them. There are 2,000 tier 1 suppliers in Germany -- a number of whom are registering to QS-9000 as well as VDA 6.1 because they also supply Ford, Opel (a wholly owned subsidiary of GM) and many more tier 2 and tier 3 suppliers.

There are many benefits to formally adapting your quality system to comply with the "cost of quality" and "voice of the customer" requirements. Although VDA has developed a draft English translation of VDA 6.1, your company might be better off evaluating ISO 9004-1 and simply incorporating those extra elements that are appropriate to your quality system, even though ISO 9001 does not require them. Why wait until 2000 when ISO 9001 and ISO 9004-1 are a consistent pair -- or even 1998 when QS-9000 may require these two extra steps beyond the baseline?

About the author

James G. Mroz is senior editor of The Informed Outlook, a twice-monthly newsletter providing information and guidance on ISO 9000, QS-9000 and ISO 14000, published by INFORM (International Forum for Management Systems Inc.), 15913 Edgewood Drive, Montclair, VA 22026; telephone (703) 680-1436, fax (703) 680-1356 and e-mail jmroz@ qualitydigest.com.


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