Implementing Integrated Management
Systems for Efficiency and Effectiveness
Chad Kymal
CTO Omnex
Omnex
Abstract Implementing Integrated Management
Systems for Efficiency and Effectiveness
In 2015 both ISO 9001 and ISO 14001 are changing. Moreover, both standards
will be adopting the same high level structure now required by Annex SL of ISO.
These changes and the new revision of both standards will require a restructuring
of the management systems. More so, both standards now need to follow the
process approach. These changes represent an opportunity for the adoption of
Integrated Management Systems. Integrated Management Systems result in a
reduced number of processes and process owners in an organization. This in turn
results in a reduction in implementation costs for those implementing the
standard for the first time. Most importantly, they also result in reduced
maintenance of management systems and reduced third party auditing
costs. Omnex estimates that the cost of implementation is reduced by 50%,
maintenance costs by 66% and third party auditing costs by 20% when
integrating ISO 9001, ISO 14001 and ISO 45001 (previously OHSAS 18001).
The paper is based on a book published by ASQ called Implementing Integrated
Management Systems QMS, EMS, OHSMS including Aerospace, Automotive
and Food Safety Management.
Agenda
Automotive Organizations and Supply Chain
Rationale for an IMS
Integrated Management Systems
Integration and Standardization
Self Assessment Questions for Integration and
Standardization
Using Software for Integration
Conclusion
Questions?
AUTOMOTIVE ENTERPRISES
The Challenge of the Enterprise
The Challenge of the Enterprise
Multi-Site, Multi-Language, and Multi-Cultural with
Multiple Standards, Audits and Risk Management
Plants
Design Centers
Corporate
Entities in N. America, Europe and
Sales Offices
Asia
Support
and Sales
Automotive Supply Chain Woes
Quality 2020 a 2015 Survey by AIAG of the
supply chain pointed to 5 top concerns of
Automotive Suppliers The 2nd biggest
concern pointed to standardization of
business processes and systems.
Note Though the overall concern was about customer
specific requirements, many processes can be integrated and
standardized with or without CSR proliferation.
Enterprise Problem Statement
Lack of consistency (of standards, processes, audits, risk management,
problem solving) across the Enterprise.
No central access for quality data.
Outdated systems, non-complaint software
Systems Incompatibility Integration needs
Process Inefficiencies
Little or no knowledge transfer or best practices between facilities.
No common nomenclature for quality metrics (including audit
nonconformities).
No integration in quality and business planning efforts (audit practices).
Lack of flexibility and functionality in current practices.
This leads to financial loss due to nonconforming product and
non-value added activities
Single Entity Stand-Alone Implementations
Mean More Work
OHS BMS Manual
EMS Manual
Integration in One Site
INTEGRATION VS STANDARDIZATION
Lack of Integration and Standardization
in Processes
ISO 9001
Integration vs Standardization
Integration refers to stand-alone systems that duplicate
training processes, document control, and internal audit
processes for each standard within the company. There is a
tremendous loss of value associated with stand-alone
management systems within an organization as discussed
above.
Worse yet, many organizations continue this duplication of
effort among their different sitesincluding plants, design
centers, and sales offices. If there is a lack of efficiency and
confusion caused by the duplication in one site, one can
imagine the magnification of these same problems when
duplication is repeated multiple times in a large organization.
Standardization
Lack of Integration and Standardization Results
Duplication of processes, audits and risk
assessment
Increased cost to implement and maintain
management systems, audits, and the risk
analysis
Increased cost to maintain system, conduct
audits or risk management systems
Duplication of Processes
Confusion for Top Management
Management has four reviews for example:
1. ISO 9001:2008 (QMS)
2. ISO 14001:2004 (EMS)
3. OHSAS 18001:2007 (OHSAS)
4. Review performed in order to operate the business
I really dont have time for this!
Do I need this??
Duplication of Processes
Confusion for the Engineer
When designing a product:
Study quality procedure for FMEA and Control Plan
Study EMS planning procedure for aspects and impacts
Study OH&S planning procedure for health and safety risks
I dont do QMS, EMS or OHSAS; I just do my job!
Why am I doing Risk Analysis multiple times?
Rationale for Integration and Standardization
In an enterprise of four sites with three management systems twelve
individual management systems vs. one integrated management system
shows that
if there are 100 process documents on average in each of the systems, then
there are 1200 documents in twelve
management systems vs.
one hundred in one integrated and standardized
management system.
If there are 100 process owners in one system it equates to twelve
hundred process owners in the four sites each carrying out specific tasks
assigned to them. 1200 process owners vs. one hundred process owners
carrying out globally assigned processes.
Just the magnitude of extra work of twelve hundred processes vs. one
hundred global processes should explain the efficiency of Integration and
Standardization.
RATIONALE FOR AN IMS
Integrated Management Systems
IMS Drivers
High Level Structure
Proliferation of
Standards
IMS Drivers
Impl and Maint Costs
Challenge of the
Enterprise
Emergence of a High Level Structure
ISO has long had high interest in
developing an integrated management
system standard.
De-proliferation mandate
Annex SL is the latest effort
High Level Structure (HLS) is Changing
New Clause Numbers
1. Scope 7. Support
2. Normative References Resources
Competence
3. Terms and Definitions Awareness
4. Context of the Organization Communication
Understanding the Organization and its Documented Information
Context 8. Operation
Needs and Expectations
Operational Planning and Control
Scope
Management System 9. Performance Evaluation
Monitoring, Measurement, Analysis
5. Leadership and Evaluation
Management Commitment
Internal Audit
Policy
Management Review
Roles, Responsibility and Authority
10. Improvement
6. Planning Nonconformity and Corrective Action
Actions to Address Risks and
Continual Improvement
Opportunities
Objectives and Plans to Achieve Them
Proliferation of Standards
Organizations today adhere to multiple standards Some examples include:
ISO 9001:2008 QMS Standard
ISO 22000:2005 FSMS Standard
ISO/TS 16949:2009 QMS Standard
ISO 26262 Functional Safety
VDA 6.3 VDA Process Audit Standard
ISO 14001:2004 EMS Standard
OHSAS 18001:2007 OH&S Standard
ISO 17025:2005 Laboratory Standard
Sarbanes-Oxley (SOX) Financial Controls
Malcolm Baldrige Excellence Standards
JACHO Medical Industry Quality Standard
AS9100 Aerospace Standard
ISO/IEC 20000 Information Technology Service Management
ISO/IEC 27001 Information Security Management
The Challenge: Growing Expectations
Source: W. Visser
Why Multiple Standards?
Customers require it!
Management wants to reduce risks:
Quality
Environmental
Health & safety
Financial
Markets require it
Certification required in order to supply product.
Industry
Government
Increasing Costs for Maintaining Standards
As standards, customer specific requirements,
and regulations grow the need for
management systems documentation and
staff grows.
Standards are expensive to implement and
maintain
Cost of implementation $50,000
Cost to maintain $30,000 - $35,000
IMS Drivers
High Level Structure
Proliferation of
Standards
IMS Drivers
Impl. and Maint. Costs
Challenge of the
Enterprise
INTEGRATED MANAGEMENT SYSTEM
What is an Integrated Management System?
An Integrated Management System includes
integrated processes, integrated risk, and integrated
audits.
Integrated Processes
Management systems are considered integrated with
70% to 95% integration for the procedures and at
least 30% for work instructions.
For a process or work instruction to be fully
integrated, it should be managed by one process
owner.
All processes do not have to be integrated.
Organizations need to determine what they want to
integrate.
Single Site Process Integration Matrix
Integrated Risk
Integrated management systems have integrated
risks (common risk methodology) between quality,
environmental, health and safety, and food safety (Q,
E, HS, and or FS) and have comparable severity (Sev.)
and occurrence (Occ.) risk ratings between the
categories.
Optimally, one team conducts the risk analysis for
the three different categories.
Integrated Audits
The use of one common audit process and
audit program for Q, E, HS, or FSMS
management systems in one site.
The audit process uses an integrated audit
checklist and an audit team capable of
auditing the integrated system.
Rationale for Integration
The object of each standard is reduction and
control of variation in processes resulting in:
Product nonconformity and waste
Injuries, illness and deaths
Environmental impact and/or contamination
System approaches to management,
improvement and control are the same.
Benefits of Integration
Focus
Integration of organizations overall goals and objectives.
Efficiency
Reducing the number of processes and process owners.
Integration of management planning, realization and
control processes.
Effectiveness
Application of proven process and risk tool throughout the
organization.
Single Entity Stand-Alone Implementations
Mean More Work
OHS BMS Manual
EMS Manual
Integration in One Site
Additional Efficiency
Additional Efficiencies are gained by:
Integrated and Standardized Risk in the Enterprise
Integrated Audits
We will discuss this in greater detail in subsequent presentations
SELF AUDIT ON INTEGRATION AND
STANDARDIZATION
Is Our Organizations Management System Integrated?
Integration Question
Key Questions
Have any of our sites developed an integrated management system
integrating QMS, EMS, OHSAS, and other management systems?
If the answer is yes, then continue. If no, go to the next slide.
Does the organization have one manual?
What percent of the processes and or procedures of the management
systems are common?
What percent of the work instructions of the organization are
integrated?
What percent of the forms and checklists of the organization are
integrated?
Are there process measures for the integrated processes?
Is there one process owner for the integrated processes?
Is Our Organizations Management System Standardized?
Standardization Question
Does the organization have one manual for the entire corporation
or the sites that have integrated?
What percent of the processes and or procedures of the
organization are common (or the sites that have integrated)?
What percent of the work instructions of the organization are
common (or the sites that have integrated)?
What percent of the forms and checklists of the organization are
common (or the sites that have integrated)?
Are there global process measures for the global processes?
Are there global process owners for the global processes?
To ask the standardization questions, at least two sites need to have
IMS implemented
Integration Savings in a Medium Size Organization
One Site
Assumptions: cost of implementation of three management
system standards, $200,000; maintenance costs, $90,000/year;
and third-party auditing costs, $45,000 for three years
Savings from implementation (one-time cost): $200,000 x .50 =
$100,000
Savings from maintenance: $90,000 x .66 = $60,000 per year for
each site (NPV at 10% would be $600,000)
Savings from third-party audit costs: $3000 each year (NPV is
$30,000)
Total Savings: $100,000 + $600,000 + $30,000 = $730,000
Implementation Savings 50% and Maintenance Savings 66%
Third Party Savings 20%
USING SOFTWARE FOR IMS
Enterprise Integrated Management Systems (EIMS)
Enterprise Integrated Management Systems (EIMS) software is
defined as software that can:
Satisfy the requirements of ISO 9001:2015, ISO 14001:2015,
and ISO 45001:2016. In fact, EIMS software needs to satisfy
and conform to the High Level Structure of ISO that satisfies
the core requirements of all ISO standards.
Satisfy APQP, FMEA, and PPAP or Risk-based Phase Gate New
Product Launch processes including Design, Process, and
Project Risk. Additionally the same risk tool should be able to
assess risks of processes in the Process Map, EMS, OHSMS or
Social Responsibility Risk (any risk from any standard).
Characteristics of an EIMS
Enterprise-wide Web-based system or equivalent
Manage multiple sites
Support multiple languages and multiple date conventions
Integrated with e-mail notification, reminders, and escalation services
Ready to integrate with legacy and ERP systems
One-point user authentication
Role-based security
Fully integrated solutions; Lean data entry
Includes enterprise integrated processes
Includes minimum functionality of ISO 9001, ISO 14001, OHSAS 18001/ISO
45001, and FSSC 22000
Ability to add one site or management system and then scale up
CONCLUSION
Conclusions Why?
Integrated Management Systems, Integrated Audits and Risk
Analysis are inevitable
Integrated Management Systems, Integrated Audits and Risk
Analysis save money
Reduces confusion and duplication of efforts
Reduces implementation costs by 50%, reduces maintenance costs by
60%
Reduces internal and external auditing costs by 25%
Reduces Risk Analysis for QMS, EMS, and OHSMS by over 50%
Using Enterprise Software Integrated Management Systems
and Risk Analysis is made easy
Implementing Integrated Management Systems
Much of the information from this webinar can
be found in greater detail in the book
Implementing Integrated Management Systems
QMS, EMS and OHSMS Including Aerospace,
Automotive and Food Safety Management
Systems written by Chad Kymal, Gregory
Gruska and R. Dan Reid.
NOW AVAILABLE through ASQ Press!
Thank You!
Questions?
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734.761.4940