International Journal of Quality & Reliability Management

Quality Audits and Technological Excellence

Walter W. Willborn
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Walter W. Willborn, (1989),"Quality Audits and Technological Excellence", International Journal of
Quality & Reliability Management, Vol. 6 Iss 4 pp.
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 Quality Audits and Quality Audits

Technological Excellence
by
Walter W. Willborn
University of Manitoba, Winnipeg, Canada 19
Received January 1988
Accepted March 1988
Technological progress, leading to excellence in performance, is closely
tied to utilisation and further advancement of computer-based quality
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assurance of products and services. Among other definitions, "quality"

is understood as "excellence" which is better than minimum standard[1].
In general terms, one can look on the auditing of quality assurance
systems as a "search for excellence" in that it evaluates existing applied
technology and reports on deficiencies and possible improvements.

To be effective, quality auditors must implement appropriate computerised auditing

tools. This will encourage others to use computer-based quality assurance
techniques. All standards for quality auditing prescribe an audit that is more than
mere verification of compliance with applicable quality assurance standards. Auditors
should assess the "appropriateness" [2] and "effectiveness" of the quality
assurance system. With this mandate and orientation and with the understanding
that an effective system must inherently have technological excellence, audits are
aiding management to attain the most suitable and cost-effective quality assurance.
This will ultimately result in the best quality of products and services.
In more specific terms, audits lead to superior production, management and
quality assurance techniques through the following features:
(1) Audits ensure that the requirements of applicable standards are met.
Standards, being descriptive documents, normally reflect the latest "state
of the art" in quality assurance and auditing.
(2) When practices deviate from such standards, auditors will also consider
that the standards need to be reviewed. In this way, auditors work with
practitioners to adjust and improve existing standards. The preparation of
additional standards will normally follow. An example is standards for software
quality assurance.
(3) Auditors also evaluate with reference to other comparable "up-to-date"
quality assurance systems they have come to know in other companies.
This enables auditors to show improvements which others have already
accomplished.
(4) Owner-operated small enterprises, especially, without ready access to aid
from specialists lag behind in using modern management and quality
 IJQRM assurance techniques. They do not recognise application of computer-
6,4 based testing and quality control without external auditors pointing this
out to them.
(5) Auditing itself demands the use of adequate auditing techniques in order
to remain useful and credible. Statistical methods and proper use of
computer-assisted auditing demonstrate the value of such control and
20 decision-making aids.
(6) Computer-assisted testing and inspection will be evaluated by auditors.
This means that the use of deliverable software is controlled. Auditors
evaluate the techniques used in the software design and testing stages.
This, without doubt, has an important impact on advancing quality control
in software engineering.
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(7) The use of the computer in design, production, management and quality
assurance helps to anticipate and prevent defects and system weaknesses
instead of just correcting and remedying them. Audits help to evaluate
in the early stages of design. Design integrity leads to more technologically
sound production and user application.
(8) Audits provide for open communication with reports becoming widely
circulated. Any deviation and apparent deficiency in the quality assurance
will be assessed and reported in a factual and constructive fashion. Many
problems and desires for change, usually representing technical
improvements, are more readily communicated through the independent
auditor.
(9) More open and constructive communication through an auditor creates
mutual trust, reduces the fear and encourages risk taking with new
technology. Many experienced practitioners still have to overcome some
mental barriers in using the computer.
(10) The fact that audits are performed creates customer confidence in the
up-to-date technology of production and the resulting products or services.
Such quality oriented audits show that technological integrity is being
maintained.
The impact and see-saw motion of quality audits on quality assurance are illustrated
in Figure 1. Any activity for assuring quality has a normal tendency to decay over
time. Procedures are poorly complied with and people presume quality is well
under control when this is not, in fact, the case. Applied technology gradually
becomes outdated.
The progress curve in Figure 1 shows the impact of repeated quality audits.
A higher level of quality assurance and system effectiveness is normally attained
through the audits and subsequent management actions. Such improvements
become less possible, however, as time progresses. The curve levels off. New
technological breakthroughs must be sought by management.
When auditors report weaknesses in quality assurance procedures, they often
induce managers to introduce superior technology. Auditors' observation of delayed
inspection, unreliable recording and reporting, inadequate defect prevention
 Quality Audits

21
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and generally poor communication are examples that can be largely resolved through
computerisation. In order to promote technological progress through auditing, both
quality assurance effectiveness and compliance with standards must be examined
by the auditor.
Audits of program effectiveness thus help to update the technology used in a
company. But what is considered "effective" by the auditor will change as the
technology progresses with time. This means that auditors must actively research
technological progress in their field of auditing expertise in order to serve their
management clients properly. Figure 2 shows innovative and integrative auditing
as approaches towards effective auditing in an environment of technological change.
The impact of general technological progress on quality auditing is now described
followed by an outline of innovative and integrative auditing as a positive response
by quality auditors.
 IJQRM
6,4

22
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Impact of Modern Technology on Auditing

As modern technology is predominantly computer based, the auditor must master
three challenges:
• auditing of computer-assisted testing and automated inspection and testing
built into the processes;
• auditing of software quality assurance systems, and
• developing and adopting computer-assisted auditing.
Auditing of computer-assisted quality assurance procedures can be technically
simple or highly complex. The following auditing features are important:
• Computer-aided testing allows a greater number of quality characteristics
on an item to be tested through all design and production stages. Defects,
if not ruled out, will be minimised when the software and surrounding
technology are adequate. The auditor will have to evaluate this adequacy.
• A greater variety of products and more frequent and rapid change-overs
demand intensive planning and control. Quality assurance procedures
become more intricate and deviations have greater detrimental impact.
• Inspection and testing shift away from the inspector and test technician
to the computer which can perform 100 per cent inspection in real time.
Operators become process controllers, if not entirely eliminated. Inspectors,
once qualified, become auditors of design assurance, production and
inspection planning, supplier quality assurance, non-conformance controls
and system maintenance.
• Software used in the various phases of product design and production is
never entirely free of latent defects. The application of the software must
be especially tested and verified by the auditor. The software might not
be properly designed for the purpose for which it is being applied by the
user; or the software is simply misapplied.
 Auditors may be called on to evaluate special software quality assurance programs Quality Audits
against various standards that were published more recently[3]. More standards
in software quality assurance are currently being drafted. Auditors of quality
assurance systems must be as qualified as special electronic data-processing (EDP)
auditors, so that co-ordination and co-operation between these modern auditing
branches become feasible.
More and more software is also provided for auditing itself. Computer-assisted
auditing goes "hand in glove" with general computerisation. Increasingly complex 23
auditing tasks demand innovative and integrative auditing.

Innovative Auditing
For the purpose of this article, "innovation" means technological improvement
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of quality assurance. While the manager decides on any technological innovation,

the auditor reports on necessary technological improvements in order to raise
programme effectiveness. Both manager and auditor seek positive innovations in
production, operations and quality assurance by means of technology transfer and
progress in the company. This contribution of auditors to technological excellence
in a company has been outlined earlier in general terms. Now we shall consider
the auditor in helping managers actually to innovate current technology in the
company. As a result, the company will become more competitive in the
marketplace.
The auditor innovates and contributes to innovation mainly in the following ways:
• Auditing "through" rather than "around" the computer — the auditor
extends the audit to electronic data processing and thus to the software
used. The examination includes the following:
— application of source code;
— data manipulation;
— data origination;
— data storage and bank;
— data coding and entry;
— data security and change control;
— information communication, and
— system review and maintenance.
In each audit element, the data flow is determined and evidence is attained
on this audit trail. Of particular interest are the error monitoring and handling.
• Comprehensive evaluation of the computer system could be restricted to
taking snapshots with marking and tracing of actual operational data on a
non-biased random basis. Transactions selected for this analysis must be
tagged. Code must be inserted into the program that will display on a CRT,
or list on a hard copy, the information on the transaction as it passes the
processing point(s). This approach would reduce and streamline auditing
where such interference with ongoing operation is acceptable.
 IJQRM • Auditors can use specially prepared "generalised audit software" — this
6,4 software performs sampling, statistical analysis, tracing, report preparation,
scanning, retrieval of records, verification of transactions and many other
auditing tasks. This software is not only a convenience but facilitates learning
and allows the auditor to make modifications in order to suit the situation
and audit task on hand.
24 • The auditor can use or develop software also for managing the audit project
— there are off-the-shelf project-scheduling and control packages readily
available also for micro and portable computers. Check-lists and other
working papers, along with general word processing, can also be
computerised and standardised.
• Since the auditor must comply with applicable auditing standards, these
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standards should be revised when computer oriented auditing is not explicitly

encouraged or required. Standards can very easily suppress innovations
and promote outdated technology.
Innovative auditing results from continuous education and training of auditors. The
ASQC Technical Committee on Quality Auditing has been instrumental in giving
this profession the necessary stimulation by instituting an examination and
certification programme and by supporting research. Among other aids, the
Committee is publishing a bibliography that includes applicable software and EDP
auditing. The ASQC Generic Guidelines for Auditing Quality Systems also directs
auditors towards technological innovation[4].

Integrative Auditing
Quality assurance has become, and is being accepted as, an important task for
all managers and staff in the organisation. The quality assurance specialist has
a supporting and guiding role which is mainly carried out through the design,
implementation and maintenance of the quality assurance system. The system
maintenance, however, is performed through quality auditing. The deeper ingraining
of quality assurance tasks in all operations of the company leads auditors, other
than quality auditors, to consider quality assurance in their audits. Quality assurance
then becomes integrated in all auditing activities throughout the company.
Quality auditors are challenged by managers and other auditors to adapt and
make their contributions. Innovative auditing as described places quality auditors
in a strong position. This innovation includes various forms of co-ordination and
co-operation with others. The ASQC Technical Committee, for example, has
established close working relationships with the American Institute of Internal
Auditors. At the other side of the spectrum, many companies arrange joint auditing
teams composed of different auditing specialists.
The objective of integrative auditing is to help management in maintaining effective
quality assurance company-wide. The more immediate goal for quality auditors
is to establish, actively and aggressively, their strong position in auditing. Taking
the leadership, rather than being possibly pushed into isolation, is a necessary
and positive reaction of quality assurance auditors. This calls for joint actions with
managers and other auditing branches. Management will support quality auditing
 only when it visibly and convincingly proves a contribution to the strengthening Quality Audits
of market positions and required technological excellence.
Whether or not quality auditors will succeed individually and collectively in raising
auditing effectiveness through co-ordination and integration with other audits
depends on several factors, for example:
• Actual working relationships of auditors with others and the status of quality
assurance and quality auditing within management and the organisation. 25
• Availability and acceptance of standards common to different departments
describing responsibilities and providing information for exchange.
• Willingness and ability of auditors to participate actively in innovative and
integrative auditing, seeking closer ties with other auditors, and advancing
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their own qualifications accordingly. Quality auditors must continually pursue

an understanding of modern management concepts and methods, as well
as a broader range of auditing knowledge and experience.
• The Technical Committee of ASQC, standard writing bodies, research in
universities, industries and governments must devote attention to integrated
auditing systems.
There are many practical examples of close relationships quality auditors maintain
with others. This usually arises from necessity in the daily life of an auditor and
is not an entirely new development. What is new is the fact that the dividing lines
are no longer so clearly and neatly drawn and that conflicts cannot be ruled out.
Taking leadership is easier said than done, particularly when managers have closer
working relationships with others than they have with quality auditors. The following
are just some principles quality auditors have followed:
• Establish formal audit programmes with individually well laid out and
computer-based audit projects and plans. Show relation, and the possible
complement or overlap, with other non-product quality oriented audits.
• Refer to applicable auditing standards in order to gain more authenticity
and credibility.
• Co-ordinate the audit programme and individual plans, possibly down to
audit elements and check-lists with other auditors working in the same field.
• Gain approval for co-ordinated and mutually agreed audit programmes and
individual audit projects from managers concerned. Show tangible and past
or expected positive cost-benefit outcomes and include a budget.
• Whenever feasible and cost-effective, plan and conduct joint audits with
other non-quality-oriented audits. Seek audit team leadership, possibly
alternating, and ensure sufficient independence and integrity of the internal
quality audit.
• Arrange quality circle-like meetings of auditors in order to discuss and resolve
problems and to promote innovative and integrative auditing.
• Pursue quality assurance of auditing and audit reports.
IJQRM Summary
6,4 Auditors of quality assurance systems contribute to technological excellence. But
in current "turbulent times" [5] the impact of computer-based and assisted design,
production and management systems has changed the situation in quality auditing.
Auditors must adapt through innovative and integrative auditing. This is to take
place by individual auditors in their various and varied audit tasks. These auditors
must promote an auditing and management policy that encourages advanced auditing
26 technology. One outstanding example is the ASQC Guidelines for Auditing Quality
Systems, sponsored by the ASQC Quality Auditing Technical Committee.

References
1. Sinha, M. and Willborn, W.W., The Management of Quality Assurance, John Wiley & Sons,
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New York, 1985.

2. Generic Guidelines for Quality Systems (Z-l. 15), ANSI/ASQC, Milwaukee, 1979.
3. Dunn, R. and Ullman, R., Quality Assurance for Computer Software, McGraw-Hill, New York,
1982.
4. Generic Guidelines for Auditing of Quality Systems, ASQC, Milwaukee.
5. Drucker, P.F., Managing Turbulent Times, Harper and Row, New York, 1980.