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ISO 9004:2000, Quality

management systems
Guidelines for performance
improvements

The ISO
9000:2000
series
by Dr. Lawrence A. Wilson

In brief
Until now, the most intensive use of the ISO 9000 family has centred
on the certification models primarily ISO 9001 and ISO 9002,
and, to a lesser extent, ISO 9003 to the detriment of the quality
management guidance given in ISO 9004 and its related standards.
ISO Technical Committee ISO/TC 176 is out to change that with
the ISO 9000:2000 series.
The emphasis on ISO 9000 certification, as opposed to using the
standards for quality improvement, has now been corrected. ISO
9001:2000 (quality system requirements) and ISO 9004:2000 (organizational performance improvements) have been expressly designed for optimal use in combination as a consistent pair.

There is very little


relationship between
the newly released
ISO 9004:2000 and its
predecessor

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1) Dr. Lawrence A. Wilson, Wilson &


Associates, 3727 Summitridge Drive,
Atlanta, Georgia, USA.
Tel. and Fax + 1 770 723 1785.
E-mail Lwilson284@aol.com

To answer these questions, Dr. Lawrence A. Wilson1), Leader of


Task Group 1.7.8, responsible for developing ISO 9004:2000, contributes this specially written article which is probably the first to
introduce the revised standard so thoroughly.

Background
ISO Technical Committee ISO/
TC 176, Quality management and
quality assurance, has recently
completed its first revision since
1994 of ISO 9004, which was published on 15 December 2000 by
ISO as ISO 9004:2000, Quality
management systems Guidelines
for performance improvements.
This guidance standard was revised by Working Group 18 of
Subcommittee 2, Quality systems.
In order to achieve maximum
consistency between ISO 9004:
2000 and ISO 9001:2000, the revision of the two documents was performed simultaneously by Working Group 18.
The joint revision process was
unique in that a project management approach was used to expedite the documents through a series of preparatory activities,
culminating in the actual writing
process being completed in only
three years. The Working Group
Project Manager (or Convener)
was Dr. Jeff Hooper, who di-

ISO 9004:2000
presents the quality
management system
as comprising many
inter-related processes
rected the effort to produce this
consistent pair of standards. Due
to the worldwide interest in the
revision of the two standards and
on behalf of SC 2, its Chairman
Dr. John Davies and Secretary
Charles Corrie, Dr. Hooper
maintained high visibility within
ISO/TC 176 during the revision
process.
Dr. Hooper was responsible for
a number of innovations, such as
the intensive use of electronic
communication (e-mail and Web
sites) to ensure that the revision
activities continued between international meetings.

ISO 9000 + ISO 14000 NEWS 1/2001

The author, Dr. Lawrence A.


Wilson, Task Group Leader of
TG 1.7.8, the TG within ISO/TC
176/SC 2/WG 18 assigned the
responsibility for developing ISO
9004:2000. He is also a member
of the WG 18 Process Operations
Task Group, as a Task Monitor.
Retired as Director of Product
Assurance and Safety, from
Lockheed Aeronautical Division
after 26 years, he is currently
President of L.A. Wilson &
Associates, a company providing
consulting services in the field of
managing for quality.

Most readers will be familiar with the basics of ISO 9000 certification, even if the requirements of ISO 9001:2000 have evolved
considerably. But what is the born again standard, ISO 9004:2000
all about and what benefits is it expected to bring to the organizations that implement it?

In another move, designed to


ensure ease of acceptance or transition to the new revisions, Dr.
Hooper established a Product
Launch Package for future users
of the standards worldwide. The
documents making up this package are available free from the
Web sites of ISO www.iso.ch and
SC 2 www.bsi.org.uk/iso-tc176-sc2
In addition, ISO/TC 176, ISO/
CASCO (Committee on conformity assessment) and IAF (International Accreditation Forum) have
established a common policy on
transition to the revised standards
for current and future holders of
ISO 9000 certificates of conformity (see, ISO and IAF cooperate
to ease ISO 9000 transition, on
the ISO Web site.
Finally, Dr. Hooper has set up a
Product Support Team to operate
after publication of the revised
standards, to further assist as necessary in the transition from the
current versions.

Each member of the


consistent pair ISO
9001 and ISO 9004
is based on the same
set of quality
management
principles

ISO 9000 + ISO 14000 NEWS 1/2001

Relationship between
ISO 9004:2000 and
ISO 9004-1:1994
The new ISO 9004:2000 is
clearly not an in-line or step-evolution descendant from the previous version, ISO 9004-1:1994,
Quality management and quality
system elements Guidelines. In
fact, there is very little relationship between the newly released
ISO 9004:2000 and its predecessor. A completely different approach has been taken regarding
the nature and application of the
technical content of ISOs new
version of ISO 9004.
Such a radical departure from
previous approaches was determined to be essential, in response
to:
the absence of user interest in
the 1994 version as a guide-

line, as manifested by lack of


sales and poor user acceptance of the document, and
recently identified user interest in the availability of suitable guidance for the management of those organizations
wishing to go beyond the basic
ISO 9001 requirements, in
pursuit of performance improvement which benefits the
organization and its interested
parties.
Although both standards have
the term, guideline in their title, the 1994 document was intended to provide basic guidelines
(9004-1) for quality management
and quality system elements.
There are several other guideline
documents in the ISO 9004 grouping which are intended for services (ISO 9004-2) and processed
materials (ISO 9004-3). ISO
9004:2000 has a different role,
that of providing guidance to management for performance improvements: firstly, improvement
of the quality management system (QMS) and, subsequently, for
improvement of the organization
itself.
In addition, the 1994 version
concentrated on a set of 20 requirement elements that are generic to any quality system,
whereas the new standard uses the
process approach to represent the

actual operation of the QMS and


the organization. The new standard recognizes that organizations
do not operate or perform the 20
elements in the QMS as separate
entities. Rather, the new standard
recognizes that all 20 elements, as
well as many other activities, are
involved in the diverse realization and support processes whose
operation and performance represents the truly dynamic nature
of any organization.
ISO 9004:2000 presents the
quality management system as
comprising many inter-related
processes that incorporate all of
the previous 20 system elements
throughout a comprehensive
QMS process network.

Relationship of ISO 9004:2000


to ISO 9001:2000
As noted above, ISO 9004:
2000 and ISO 9001:2000 are each
part of a consistent pair of quality
management system standards.
These standards may be used as
either stand-alone documents, or,
optimally, as a pair of complementary standards with different
but consistent purposes and
scopes.

These standards may


be used as either
stand-alone
documents, or,
optimally, as a pair
of complementary
standards with
different but
consistent purposes
and scopes
As stated, ISO 9004:2000 provides guidance for developing a
comprehensive quality management system, directed towards the
management of the organization,
the implementation of which can
enable management to improve
the performance of both the quality management system and, ultimately, the organization itself. In
support of guidance for a comprehensive quality management system, ISO 9001:2000, as a subset of

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within boxes (boxed text) in


ISO 9004:2000. Due to the fact
that the two standards have the
same basic structure, the boxes
with the ISO 9001 requirements
have been conveniently located
adjacent to the related text of ISO
9004.

the comprehensive QMS, identifies the basic requirements within


the system which are necessary to
ensure that the organization
meets specified requirements,
and has evidence to that effect.
For ease of use and application,
each member of the consistent pair
is based on the same set of quality
management principles, developed by ISO/TC 176. Both standards have basically the same document structure and use the process
approach both to organize their
content and also to facilitate their
implementation by organizations.
The principles are common to successful organizations and close
variants are found listed in the requirements for candidates participating in national and regional
quality award programmes.

2) move the examination beyond


the ISO 9001 requirements to
take advantage of the related
ISO 9004 guidance which
identifies those recommended
management actions that collectively can result in continual performance improvement of the entire organization.

ISO 9004:2000 as a
management tool for
improving the organization

Principle 5 System approach to


management

in pursuit of continual improvement, and resultant organizational success. The concepts are
integrated within the clauses and
text of both standards. Whereas
the ISO 9001:2000 standard focuses on the provision of satisfactory product to customers, ISO
9004:2000 is directed toward performance improvement and the
satisfaction of all interested parties of the organization. Interested parties have a stake in the
success of the organization and
benefit in some way from the organizations success.

Principle 6 Continual improvement

The interested parties of a typical organization may include:

Principle 7 Factual approach


to decision making

customers and end-users,

Principle 8 Mutually beneficial supplier


relationships

owners and investors,

These quality
principles are:

management

Principle 1 Customer focus


Principle 2 Leadership
Principle 3 Involvement of
people
Principle 4 Process approach

The principles are presented in


Clause 4.3 of ISO 9004:2000 and
ISO has also produced a brochure
on them, giving further explanations. The brochure is available
free on ISOs Web site: www.iso.ch

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1) examine the directive text of


ISO 9001 to see what is expected in order to meet the
specified requirements and,

The principles represent the


concepts that should be applied by
the management of organizations

people in the organization,


suppliers and partners,
community and society
Contrary to past practice in the
publication of of ISO/TC 176
standards,
the
requirements
stated in ISO 9001:2000 are also
provided in ISO 9004:2000 for
ease of use. The ISO 9001:2000
requirements are clearly identified and enclosed separately

ISO 9004:2000 is written for


management, with a focus on top
management being the primary
level responsible for the success
of the organization and thereby
achieving satisfaction for all the
organizations interested parties.
The standard provides guidance
and is not directive in nature.
There are no stated requirements. It offers concepts, ideas,
suggestions and recommendations for management to use or
not use, as they determine the
standards applicability to the organization.
The guidance in the standard
tends to convey a representative
set of best practices for management consideration. The standard does not attempt to present
a course in the management of
organizations, however, it does
provide guidance on the benefit
to the organization of taking
those important steps beyond
simply meeting specified requirements.
For example, ISO 9001:2000
focuses on the effectiveness of operation does it meet the requirement or not? but ISO 9004 focuses on both effectiveness and
efficiency does it meet the requirement in a manner which is
both cost effective for the organization and will benefit the organizations interested parties?

ISO 9000 + ISO 14000 NEWS 1/2001

ISO 9004:2000 is
directed toward
performance
improvement and the
satisfaction of all
interested parties of
the organization

This placement of the ISO 9001


requirements within ISO 9004
permits the user to:

The guidance provided in ISO


9004:2000 can be used by top
management to move the organization toward the achievement of
performance improvement, on a
continual or sustained basis. The
strategy presented is to use improvement within the quality
management system as the driver
or engine to achieve performance
improvement for the entire organization.
By continual improvement of
the processes of the QMS and by
satisfying the organizations interested parties, all in an effective and
efficient manner, management can
utilize the content of the standard
as a tool or vehicle for moving the
organization toward excellence.
The extent of the desired movement toward excellence is to be
determined by management.

It is also clearly stated in the


scope of ISO 9004:2000, that it is
not a guide for the implementation
of ISO 9001:2000. Although the
two standards have a similar structure, are based on the same quality
management principles and embrace the concept of managing the
organization by use of the process
approach (using basically the
same process model), these two
ISO standards serve different purposes and have different scopes.

ISO 9000 + ISO 14000 NEWS 1/2001

Since there are no actual requirements


stated
in
ISO
9004:2000, only recommendations to management, there are no
mandatory conformance points by
means of which a compliance or
conformity assessment can be legitimately performed. The contents of the standard are optional
and acceptance for use is entirely
at the discretion of the management of the organization. Only
management is in a position to
determine if the recommendations are suitable for implementation, or timely. As clearly stated
in the content of the standard itself, it is not the intention or purpose of the standard that it ever be
used for certification purposes.

How ISO 9004:2000 provides


guidelines for performance
improvement
Both ISO 9004:2000 and ISO
9001:2000 have four principal
clauses, the titles of which are:
Clause 5, Management responsibility,
Clause 6, Resource management,

The desired movement may be


toward national or regional excellence award models, or the movement may be based on desired
market share or profit margins.
Even if the organization is resource-limited, whether such
movement is planned or not, or
whether deferring to a more suitable timeframe is best for the organization all are entirely a decision of the organizations
management.
Whatever the reason for the
pursuit of improvement or excellence, or the rate at which it
moves, the use of ISO 9004 will be
a vehicle for moving straight toward improvement. Direct line
movement means that there is
never a situation where there is a
concern for re-trenching or changing direction from using the ISO
9004:2000 vehicle, even if a national excellence award becomes
the goal of the management of the
organization.

ganization can make such a decision. A progressive organization


may elect to take advantage of
the ISO 9004 recommendations
when implementing ISO 9001,
whenever going beyond ISO 9001
requirements is in the best interest of the organization and is in
keeping with the organizations
strategic plan.

Clause 7, Product realization,


Clause
8,
Measurement,
analysis and improvement.

The guidance
in the standard
tends to convey
a representative set
of best practices
for management
consideration
Even though the two standards
have a consistent structural outline, most notable in the respective table of contents, ISO
9004:2000 does not cover the
same textual content as ISO
9001:2000. For example, a given
topic in ISO 9004:2000 may address the effective and efficient
improvement of all the realization and support processes in the
total organization to the satisfaction of all its interested parties. In
contrast, ISO 9001:2000 approaches the same topic with the
more limited scope of the effective improvement of the realization process as it relates to satisfying customer requirements.

However, even with the same


clause titles in the two standards,
each clause is approached from a
different viewpoint. A number of
differences have already been
discussed. The differences tend to
highlight the major discriminators
or critical identifiers between the
two standards. Examples of the
discriminators for ISO 9004:2000
show that it:

Obviously, there is material in


the content of the ISO 9004 revision which may provide ideas that
may aid in the implementation of
the ISO 9001 revision, but only
the management of a given or-

3) has been written for the use of


top management,

1) is clearly a guideline standard and states no requirements,


2) provides guidance for performance improvement, both
of the QMS and the organization,

4) focuses on improvement of all


realization and support processes in the organization,

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5) addresses both effective and


efficient improvements in the
organizations processes,
6) seeks to achieve the satisfaction of all the organizations
interested parties,

9001:2000. By glancing through


the list of statements, the user can
quickly develop an accurate view
of the nature of the content of the
new revision of ISO 9004.

7) looks beyond ISO 9001 toward the pursuit of excellence by the organization,

Clause 5 Management
responsibility

8) displays all ISO 9001:2000


requirements within separate
and identified boxes,

Clause 5.1.1 Using external


measurement,
such
as
benchmarking and third party
evaluation

9) has an Annex A for the performance of self-assessment by the organization,


10) has an Annex B for the performance of continual improvement by the organization,
11) is not meant to be a guide for
the implementation of ISO
9001:2000,

Clause 5.1.2 Planning for the


future of the organization and
managing change
Clause 5.2.1 Society in terms of
the community and the public
affected by the organization

Clause 5.6.1 Management reviews should be platforms for


new ideas, with open discussion
Clause 5.6.2 The reviews should
include the financial effects of
quality related activities
Clause 5.6.3 Review outputs
should include information for
strategic planning and future
needs

Clause 6 Resource
management
Clause 6.1.1 Top management
should ensure resources necessary for its strategy and objectives

Clause 5.2.2 Identify market opportunities, weaknesses and


future competitive advantage

Clause 6.1.2 Consider organization


structures,
including
project and matrix management needs

Clause 5.2.3 Benefits to interested parties from exceeding


statutory/regulatory requirements

Clause 6.2.1 Development of


people by involvement in objective setting and decision
making

Clause 5.3 Use the quality


policy as a means of leading
the organization

Clause 6.2.2.1 Resources include anticipated management and workforce succession needs

12) is not meant to be used for


certification purposes.

It is not the intention


or purpose of ISO
9004:2000 that it ever
be used for
certification purposes

1) simply extending the basic


ISO 9001 intent, so as to consider such aspects as satisfaction of all interested parties,
or the pursuit of efficiency in
addition to effectiveness and,
2) providing uique considerations for the management of
organizations interested in receiving the full benefits from
the ISO 9000 experience, as
they pursue performance improvement.

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Some typical examples of performance improvement guidance


from subclauses within each major clause are presented in the following sequence, Clauses 5 8.
For each subclause, there is a
paraphrased example of statements which are typical of those
found in ISO 9004:2000, but
which would not be found in ISO

Clause 5.4.1 Quality objectives


for the future needs of the organization and its markets
Clause 5.4.2 Quality planning
using related risk assessment
and mitigation data
Clause 5.5.1 All the organizations people should have authority to help achieve objectives
Clause 5.5.2 Management
representative(s) should be
given authority by top management
Clause 5.5.3 Management
should actively encourage
feedback and communication
from people

Clause 6.2.2.2 Training considers leading, problem solving,


teambuilding, and communicating
Clause 6.3 Consider environmental issues like conservation, pollution, waste and recycling
Clause 6.4 Work environment
includes heat, humidity, light,
airflow, hygiene, and noise
Clause 6.5 Data are a resource
which, when converted to information, can become knowledge

ISO 9000 + ISO 14000 NEWS 1/2001

Within each of the major


clauses of ISO 9004:2000, there is
guidance that clearly goes beyond the requirements of ISO
9001:2000. This guidance may
take the form of:

Clause 6.6 Partnerships can aid


in the mutual improvement of
processes that create value
Clause 6.7 Have contingency
plans to ensure the continuing
availability of natural resources
Clause 6.8 Improving a QMS
aids in reducing costs of product failure, warranty, lost markets

Clause 7 Product realization


Clause 7.1.1 Support processes
are necessary, adding value to
the organization indirectly
Clause 7.1.2 Evaluate the role
of people within processes to
ensure peoples health and
safety

Clause 7.4.1 Cost of purchased


product should include product
performance, price and delivery
Clause 7.4.2 Conduct supplier
financial review for viability
during intended period of supply
Clause 7.5.1 Control of realization processes for conformance, and benefit to interested
parties
Clause 7.5.2 Traceability may
be a contract requirement,
such as for product recall or to
meet regulations
Clause 7.5.3 Organizations
should protect the value of
customer property in its control

tor/industry studies and the


media
Clause 8.2.1.3 Audits may also
include evidence of excellence for use in motivation and
reward
Clause 8.2.1.5 Self-assessments
can determine the maturity of
the quality management system
Clause 8.2.2 Process measurements may include throughput,
yield, capability, waste and
cost
Clause 8.2.3 Product measurement may include customer,
regulatory or third party verifications
Clause 8.2.4 Perception of the
organization by relevant sections of society should be
measured

The self-assessment
approach is not a
substitute for the
formal internal audit
process

Clause 7.1.3.1 Operating plans


should define opportunities
and actions for process improvement

Clause 7.5.4 Identify resources


to maintain product throughout its life cycle to prevent
damage

Clause 7.1.3.2 Verification of


product can be carried out
within the process to identify
variation

Clause 7.6 Organizations


should consider eliminating
potential process error by foolproofing

Clause 7.1.3.3 Validation should


consider use of resources including materials and energy

ISO 9000 + ISO 14000 NEWS 1/2001

Clause 7.2 Process review information includes market research, with sector/end-user
data
Clause 7.3.1 Besides specified
design factors, consider life cycle, usability, ergonomics, risk
Clause 7.3.2 Consider needs and
expectations of end-users, as
well as those of direct customers
Clause 7.3.3 Design review
should evaluate potential hazards or fault modes in product
use

Clause 8 Measurement,
analysis and improvement
Clause 8.1.1 Organization must
ensure the validity and purpose of measurements/data
add value
Clause 8.1.2 Measurements of
customer satisfaction are vital
for evaluation of the organization
Clause 8.2.1.1 Improvement areas can be noted from satisfaction surveys from interested
parties
Clause 8.2.1.2 Satisfaction data
may be from focus groups, sec-

Clause 8.3.1 Nonconformities to


both realization and support
processes may be recorded for
use
Clause 8.3.2 Authorized people
should determine any trends
or patterns requiring attention
Clause 8.4 For total performance evaluation, integrate
data from all parts of the organization
Clause 8.5.1 Improvements can
range from small-step continual improvement to breakthroughs
Clause
8.5.2

Analyzing
nonconformities may be carried out by an individual or by
a corrective-action team
Clause 8.5.3 Management
should plan systematic mitigation of losses, by a loss prevention plan
Clause 8.5.4 Management
should create an environment
to involve people pursuing improvement

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Annex A provides a methodology for the user to evaluate the


quality management system of
the organization. This is from the
point of view of whether the system is actually accomplishing
what is intended and just how well
it is doing in that regard, as rated
on a predetermined scale reflecting improvement or position (i.e.
1- 5).

Approaching
continual
improvement as an
investment will
result in sound
business decisions
Self-assessment is a judgement
based on a simple evaluation
made by knowledgeable people,
anticipated to be the top management, who go through a process of
asking and answering key questions. The assessment may or may
not require the assessor to go to
the pertinent site. The assessment
may be for all or a small part of
the system, may be done as convenient, by one person or several,
or may be used as a simple indicator to be combined with other
measures. Annex A has not been
developed to be used in competition with other self-assessment approaches.
Sample questions are provided
in the Annex. However, the user,
or the organization itself, may develop even more suitable questions, ones directly relevant to its
operations. In other words, using
Annex A as a guide, the user organization can tailor the questions
to its own concerns and interests
and use the answers to determine
approximately where it stands in
relation to where it wants to be.
Used over a period of time, the
management of the organization
can monitor apparent change, the
direction of the change and
whether the rate of change is as
expected or desired. Over time,
the degree of maturity of the quality management system and indeed the organization itself may
be observed and monitored.

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Another aspect of Annex A is


the equating of benefits or results
to the progress or maturing of the
quality management system. As
the organization makes progress,
it can also check that the expected
benefits are encountered. Alternatively, the desired benefit may
be selected and then the relevant
questions developed to guide the
organization to that goal.
The self-assessment approach
is not a substitute for the formal
internal audit process. The basic
content of the standards present
the internal audit process which is
to be used for determining the
conformance (or nonconformance)
of the organization to its quality
management system. Internal audit utilizes trained auditors to
compare specific requirements
with the actual performance of the
organization as to its conformance to the selected requirement.
It is a yes-or-no decision based
upon objective evidence. A selfassessment as presented in Annex
A is based on the opinion of one or
more experts within the organization.

Annex B, Process for


continual improvement
Annex B presents a simple, generic process for continual process improvement that can be used
by any organization. It covers
both ongoing small-step continual
improvement and the breakthrough, or large-step improvement.
The basic process, whether for
either small- or large-step improvement, will utilize the same
activities for achieving improvement. The process also makes it
clear that the involvement of the
people in the organization is one
of the best ways to reap the most
benefit. Management must create
the environment for people to be
responsive, and therefore, for the
process to be successful.
By following the simple steps
presented in Annex B, in the sequence offered, the management
of any organization can quickly
develop an ongoing programme.
Attention should be directed toward the need to allocate and
prioritize projects and resources
for the continual improvement
process. Approaching continual
improvement as an investment
will result in sound business decisions.

Summing up
ISO 9004:2000 has been developed as one member of a consistent pair of quality management
standards, the other member being ISO 9001:2000. Both standards are based on a set of quality
management principles that have
been integrated into the content
of each standard. ISO 9004:2000
permits the management of the
organization to go beyond the requirements of ISO 9001 to pursue
performance improvement of the
quality management system and
ultimately performance improvement of the organization itself,
thus benefiting the organizations
interested parties.
The recommendations and content of ISO 9004:2000 can be used
as a tool to move the organization
as far toward improved performance as desired by the management and permitted by the resources. The standard also has an
annex for guidance on self-assessment and one on a continual improvement process.

ISO 9000 + ISO 14000 NEWS 1/2001

Annex A, Guidelines for selfassessment