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Validated Performance Statements - Going Public
With Your Quality Management Successes
By David Powley DNV Certification Ltd
The concept of quality management has been with industry and commerce
for some time. So too have various means and devices with which an organisation
may choose to demonstrate its level of quality management. Just one example
of this has been the certification to various standards and specifications
that relate to quality management. There has always been a need therefore
to achieve a certain state of adequacy and publicly declare that state
of adequacy to any interested party. This is natural in a competitive
and international business world where anything that can raise the stakes
on the competition is sought and used in an unremitting commercial war.
However, there has been insufficient appreciation given to the power of
the publication of data and information on actual performance
as a result of quality management. In matters relating to the environment,
the reporting of performance is long established. Many of the large corporations
have for a long time declared their environmental probity and credentials
by publishing validated environmental performance statements and this
has in recent years resulted in the formal European Union regime known
as the Eco-management and Audit Scheme (EMAS). The less formal validation
of environmental statements has been in existence for considerably longer.
Similarly, publication of data on health and safety performance is known
but this has been to a lesser extent and mainly, though not exclusively,
for internal consideration.
There are great possibilities for an organisation in producing a quality
performance statement. Registration to quality management codes and standards
have proved to be reliable in showing the credentials of an organisation
and can act as a general indicator (or predictor) along the lines of that
organisation being reliable when entering into business transactions.
Nevertheless an even more distinctive advantage may be gained by providing
reliable information on actual quality management performance
which is pertinent to the potential ‘buyer’ or any other relevant
interested party. The procurement manager of an organisation may find
his/her task made easier during selection of contractors and suppliers
when confronted with validated data of particular interest. Similarly
a sales force may find life a little easier when it can brandish favourable
and reliable performance information about its own organisation.
| What then are the potential benefits
arising from; |
| • |
producing a performance statement
on actual quality management performance |
| • |
having that statement rigorously validated by a
reputable third party and then |
| • |
publishing that statement? |
Why produce a Quality Performance
Statement?
The suggested content and structure of a Quality Performance
Statement (QPS) will be considered in more detail later. At this stage
it is more worthwhile considering the benefits of producing and validating
a QPS. Suffice it to say for now that a statement should have a structure
and contain that which impresses readers who are relevant interested parties.
The relevant interested parties are various but the following are given
together with the benefits and advantages that may be gained as a result
of producing (for them) a validated QPS.
Existing clients and customers
This is the relevant interested party that is already on your ‘buying
platform’ and consequently needs to be protected due to their significance
to the survival of your business. It would be beneficial for you to keep
the customers appraised, by means of a QPS, of the aspects that may have
caused them to enter into contract with you in the first place especially
if your organisation has shown further improvement with regard to these
aspects. Alternatively, if certain matters of quality performance in the
past have given cause for concern, an independently validated QPS may
give assurance to the existing customer.
Prospective clients and customers
New clients and customers are crucial to the growth of the business and
of course deserve to be impressed. These are actual prospects who have
shown an interest or have already entered into dialogue with a view to
a business transaction. A third-party validated QPS inserted with the
other necessary tender documents may assist in securing a contract especially
if the QPS contains enough favourable information on the aspects of your
organisation which are of most interest to these prospects.
The general market
This interested party represents the prospective customers who are not
yet known to your organisation yet are equally crucial to the development
of your business. The power of good advertising is well known and could
be further enhanced by the information contained within a QPS. In other
words chosen extracts and quotes (within context) from a validated QPS
inserted within an advertisement may put some distinction between your
organisation and the competition.
The shareholders
A third party validated QPS, proudly disseminating performance data and
placed within an annual report, may persuade shareholders that their investment
is secure.
The managing director
This is the person who may occasionally make sounds of doubt about your
ISO 9000 series management system, if you have one. A third party validated
QPS showing the favourable effects of the management system could maintain
or increase the level of support.
The workforce
The people of the organisation who have been most instrumental in producing
a good performance may experience a boost of morale upon reading a praising
QPS which has been validated by an independent and reputable third party.
What should be the content and structure of Quality Performance Statements?
| What then are the potential benefits
arising from; |
| i. |
A presentation of the organisation’s
mission statement or policy (should it have one) and a description
of the organisation, its activities and the time frame to which the
QPS applies. |
| ii. |
A description of the ‘quality critical aspects’
of the organisation. |
| iii. |
A description of how the organisation is managing
these ‘quality critical aspects’. |
| iv. |
A presentation of key performance information and
statistics which relate to the ‘quality critical aspects’. |
| v. |
A description of the organisation’s objectives
and targets. |
| vi. |
Any other preferred information. |
| These items can be considered in turn: |
| i. |
Policy, mission statement, organisation,
activities and time frame – It is important to be clear on the
activities or processes or the part of the organisation, to which
the QPS applies. Similarly the period of consideration is relevant.
This is a kind of ‘ring-fencing’ which enables all reporting
in (and validation of) the statement to be on a sound basis. Publication
of a customer / quality policy or mission statement in a QPS is a
good opportunity to brandish the ideals of the organisation as well
as publicising any intentions and customer care initiatives. |
| ii. |
Quality critical aspects – These are the
aspects of an organisation’s activities that determine the relationship
with relevant interested parties and can lead to success or failure
depending on how well they are managed. The following are merely examples,
- a service call centre and its response time and friendly dialogue
with callers,
- a retail operation and the visual impact of the store and the demeanour
of staff to customers,
- a manufacturer’s capability to deliver material on time and
within specification,
- an advisory or consultancy service and its capability to deliver
competent advice.
Whatever the quality critical aspects are considered to be, it is
suggested that these are given in the QPS in order to show relevant
interested parties that these have been recognised. |
| iii. |
Management of quality critical aspects - The basis
of management of quality critical aspects is a combination of doing
something to manage the risk of failure and to monitor this management.
Generally speaking a manufacturing situation demands the management
and monitoring of hardware and people capability equally whereas service
situations would give predominance to the management and monitoring
of people capability. A QPS, in providing a description of the management
of quality critical aspects, might briefly say something about what
the organisation is doing (i.e. managing and monitoring) with regard
to assurance of plant and equipment and the development and control
of its personnel, as is appropriate to the aspects. |
| iv. |
Key performance information and statistics –
This is probably the most important section of a QPS, generating the
most interest for the readership and those who would validate it.
It can contain all of the information and data which is for consideration
by all of the interested parties given above or just that which is
of significance to those who are most important. Of course, the type
of information will depend on these targeted readers. Data on number
of customer complaints, out of specification product, late deliveries,
response times etc. may all be meaningful for inclusion. Positive
as well as negative reporting is important in order to establish an
element of balance. ‘Internal’ data may be indicative
for a number of relevant interested parties and this could include
the amount of re-work or staff absenteeism or turn-over etc. Whatever
the information, it should be relevant to quality critical aspects
and the relevant interested parties. The validation process (see later)
will check the veracity of the information. |
| v. |
Objectives & targets – It may be appropriate
to insert, into the QPS, a section on the organisation’s objectives
and targets. This is especially so in cases where it is felt an improvement
in performance is achievable or necessary. Real intentions are almost
as important as actual achievements to a customer who has been disappointed,
for example. This declaration may just make that customer give another
chance. Objectives are more believable if they are carefully and briefly
stated and have adequate descriptions of the intended means of achievement
together with time frames. Here again the validation will ascertain
the ‘reality’. |
| vi. |
Any other preferred information – Any other
relevant information may be useful for inclusion in a QPS provided
that it is possible to validate it. |
Who should validate Quality Performance Statements
and how should they be validated?
So far the ‘why’ and ‘what’
regarding QPS have been considered. It is now time to deal with the ‘who’,
‘how’ and to a lesser extent the ‘when’.
In order to validate a QPS it must firstly be appreciated what the actual
statement represents. That is a serious declaration of claims made to
a population. It follows that whoever validates a QPS carries a high level
responsibility thus requiring the process to be carried out by capable
individuals in a conscientious manner. Furthermore, the validators must
hold a considerable status and track record of independence and propriety.
In checking the veracity of quantitative and qualitative claims, a validator
would ‘look behind’ the presented data and information to
check that the system generating it was sound. For example, a QPS may
state a number (or even a reduction in the number) of customer complaints.
This would lead a validator to establish a level of confidence that the
system and personnel are able to detect and register a customer complaint
when confronted by one. If there were a qualifying definition of what
constitutes a customer complaint (as there should be) then a validator
would expect to see this definition in the QPS.
A validator would also seek that a QPS maintained a level of balance.
Should an organisation have ‘tales of woe’ in the same context
as success stories, then the QPS ought to give due recognition. Claims
regarding Objectives or intentions should be checked to establish a level
of ‘reality’ and commitment.
In all of this the validator would be constantly comparing the presented
situation (in the QPS) with the reality. The variances found can be addressed
in only one of two ways before validation and publication is possible.
These are either making the statement meet the reality or vice versa.
In most cases the former would be the preferred and often the only possible
path of correction. What comes to mind here is a piece of advice that
EMAS verifiers give to producers of environmental statements which is
‘Tell it like it is, however it is’.
| A QPS validation requires a suite of
skills and capabilities. Should they not all be found in one person
for a contract then this will need to be complemented. The 3 core
skills are: |
| a) |
A capability in auditing, preferably
of management systems. |
| b) |
A suitable knowledge of the industry sector concerned. |
| c) |
A capability to interrogate presented data and
information for its truth, representation, accuracy and balance. |
As indicated above, a QPS can only reasonably be representative
of a time frame in the life of an organisation. Subsequent validations
of later Quality Performance Statements are possible or even validation
of summary up-dates.
Is there a relationship between ISO 9000 series management
systems and Quality Performance Statements and their validation?
The short answer here is yes. However, even posing the question
should indicate that having an ISO 9000 series management system is not
a pre-requisite for successful validation of a QPS. There are likely to
be many organisations that have chosen not to develop any formal management
system yet are capable of producing a QPS that can withstand the validation
process.
Nevertheless a company possessing an ISO 9000 series management system
will be in a fortunate position to facilitate the validation. It will
very likely have good record generation and management regimes, especially
with regard to retrieval of records containing supporting data. It will
also have confidence-building internal audit activity and generally follow
all of the disciplines that go hand in hand with management by management
systems. All of this is likely to give a degree of comfort to a validator
during selection of a ‘sample’.
It is also interesting to note that ISO 9001:2000 supports the concept
of performance reporting.
The need for an organisation to publicly declare
its performance and credentials is not new. The success of the advertising
industry is testimony to this. However, in most situations there has been
a lack of opportunity to establish the reliability and reasonableness
of these declarations. The process of validation has been absent. It is
only by subjection of such claims to the scrutiny of an independent, respected
and reliable third party that a degree of comfort can be given to interested
parties. It is very possible that those who are willing to publicly declare
their performance and undergo validation will enjoy a competitive advantage.
DNV QA Ltd, part of Det Norske Veritas, is offering an independent service
for the validation of Quality Performance Statements.
| David Powley is a Principal Lead Integrated Management
Systems Auditor for DNV Certification Ltd. He is a Chartered Chemist
and Member of the Royal Society of Chemistry, Member of the Institution
of Occupational Safety and Health, a Principal Environmental Auditor
with the Institute of Environmental Management & Assessment, a
registered Lead Auditor with the International Register for Certificated
Auditors scheme for quality management systems and Lead Verifier for
EMAS. David has produced many published articles on management systems
for quality, environment and health & safety and their integration,
being regarded as a pioneer on the subject of integration. He is currently
finalising an experienced-based book on the subject of integrated
management systems. David can be contacted on dave.powley@dnv.com |
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