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How Can You Move From QS-9000 to TS 16949:2002?

considering any in the group.

Control, Measure and Analyze Are Last 3 QS to TS Challenges

By Chad Kymal and David Watkins
Publishers Note: This article has been reprinted with permission from THE INFORMED OUTLOOK Newsletter, June 2003 issue. hen we started examining the 15 key challenges of transitioning from the third edition of QS-9000 to ISO Technical Specification (TS) 16949:2002 in November 2001, the second edition of the automotive TS had not yet been finalized and the number of registrations to the first edition of the TS was minimal. Today, there are more than 130 ISO/TS 16949 registration certificates held by North American automotive suppliers (as of May 14, 2003), and the first Big Three transition deadline for TS 16949 is slightly more than a year away. However, more than 9,300 certificates for QS-9000:1998 registration are still held by automotive suppliers in North America, so the number of organizations facing the 15 key challenges as we complete this series remains vast. While some of those 9,300+ certificates will disappear as organizations with multiple certificates consolidate them under a global registration and others will migrate to ISO 9001:2000 (either because the suppliers organization is not eligible for ISO/TS 16949:2002 conformity or it can meet customer requirements using ISO 9001:2000), a large number of organizations will need to understand what the 15 challenges we have identified are and how they can be addressed in transitioning from QS9000. Indeed, many of those migrating to ISO 9001:2000 from QS-9000 will need to conform as well as they can with the supplemental sector requirements in ISO/TS 16949 if they have a customer(s) that is registered to the TS and supplies to an original equipment manufacturer (OEM). Table 1 on the next page provides the full list of the 15 challenges and indicates the entries in this series in which the first 12 were examined. In this article, we will be examining the last three transitional challenges with ISO/TS 16949:2002: Subclause 7.1.4, Planning of Product RealizationChange Control Subclause 8.2.3, Monitoring and Measurement of Processes Clause 8.4, Analysis of Data. The sequence in which we have covered the 15 key challenges does not mean that these 3 should be the last that you address in upgrading your quality management system (QMS). Rather, each set of 3 that has been examined has been presented in this sequence to build on correlations that exist among certain groups of clauses and subclauses. While the three challenges addressed below may seem unrelated at first glance, we think you will find that it makes sense to discuss them together and for organizations to think about each one when

Subclause 7.1.4, Change Control

Although QS-9000:1998 contains Subclause 4.9.5, Process Changes, QS9000 does not require the organization to have a process to control and react to changes that impact product realization to the extent that ISO/TS 16949:2002 does. In fact, something approaching this requirement was contained in the edition of Q-101 that preceded the present one. In that edition, which also preceded the advent of QS-9000, Question 3 in the Ford Quality Assessment presented the need for Change Control or Managing Change, along with a checklist on how to manage the change. The manage the change process introduced in the last edition of Q-101 was rolled out with a manage-the-change checklist that considered a long list of design, manufacturing and quality documents that could be affected when a change was implemented. The reason that this requirement was included in the Q-101 Quality Assessment was to measure the impact that changes had in causing line shutdowns on supplier assembly lines or in the organizations own facilities. Typical examples given included: 1. A coolant change in a manufacturing process interacting with the coolant in a washer either in the organizations own facility or at the assembly plant 2. A design change in a component interacting negatively in the assembly or subassembly of the product. Change Control, as defined in Subclause 7.1.4, is linked directly to the production part approval process (PPAP). In effect, product or process changes that affect product realization

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Reprint: June 2003

Table 1. The 15 Transition Challenges for QS-9000 Organizations

Clause/Subclause 4.1, Quality Management System General Requirements* 5.2, Management Responsibility Customer Focus 5.4.1, PlanningQuality Objectives 5.5.3, Internal Communication 5.6, Management Review 6.1, Resource Management Provision of Resources 6.2, Human Resources (particularly 6.2.2.3 and 6.2.2.4) 7, Product Realization 7.1.4, Change Control 7.3, Design and Development* Influenced by ISO 9001:2000 Challenges Requirements for process map (or equivalent), process management, customer-oriented processes, support processes and process characteristics. Decision on customers vs. interested parties. Need for process to gather needs and expectations of customer/interested parties. Deployed Objectives addressing customer expectations. Creation of internal communication processes suitable to organization. Revision of previous management review process. TS adds additional items to be reviewed. Establishment of a resource allocation process. Provision of job competency, on-the-job training and employee motivation and empowerment. Documents for effective control of all processes in process map. Minor change for most suppliers. Inclusion of design and development of processes, not just product (note required development and use of FMEAs) Inclusion of service suppliers in coverage and use of supplier monitoring indicators. ISO 9001:2000 registration of suppliers Customer rating for quality and delivery insufficient; monitoring of customer perceptions of quality. Importance of customer satisfactionsupplemental requirements, including delivered part quality and schedule performance to IATF. Manufacturing process and product audits and audits based on COPS and process approach. Process studies on manufacturing processes. Measurement of all processes in process map. Increased scope from QS-9000.

ISO 9001:2000

ISO 9001:2000 & TS 16949:1999 ISO 9001:2000 ISO 9001:2000 & TS16949:1999 ISO 9001:2000 ISO 9001:2000 & TS 16949:1999 ISO 9001:2000 New (actually Fords Q1 2002) New

7.4, Purchasing*

New

8.2.1, Monitoring and Measurement Customer Satisfaction

ISO 9001:2000

8.2.2, Internal Audit 8.2.3, Monitoring and Measurement of Processes 8.4, Analysis of Data

TS 16949:1999 ISO 9001:2000 & TS 16949:1999 ISO 9001:2000

*Clauses/Subclauses examined in the third article in series (November 2001). Clauses/Subclauses examined in the fifth article in series (July 2002). Clauses/Subclauses examined in the sixth article in series (September 2002). Clauses/Subclauses examined in the seventh article in series (December 2002).

Reprinted with permission from THE INFORMED OUTLOOK June 2003 issues

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Volume 8, Number 6
need to be evaluated and verified by the organization. The customer should be apprised of any change as defined in the related PPAP reference manual, including changes to the customers proprietary designs. If a PPAP is required, then it needs to be conducted in order to validate that the change had no impact on the ability of the product and/or process to meet customer specifications. Of course, PPAP is only a customerspecific requirement of Chrysler Group, Ford Motor Company and General Motors. The customer-specific requirements of your organizations individual customer(s) need to be considered when conforming with Change Control. Although Subclause 7.1.4 is a new requirement in ISO/TS 16949:2002, it is not really new to the US automotive industry. This requirement was included by most organizations during QS-9000 implementation either because of PPAP or Q-101. The biggest impact of 7.1.4 could be found in the statement: For proprietary designs, impact on form, fit or functionshall be reviewed with the customer. This requirement differs slightly from QS-9000:1998, where 4.4.9.1, Design ChangesSupplemental, required the impact on form, fit, function, performance, and/or durability shall be determined with the customer so that all effects can be properly evaluated. The expectation is that the organization now has responsibility to consider the impact of changes not just on customer-owned design, but also on the designs that it owns.. This approach to Change Control involving proprietary designs was not implemented in many of the large Tier 1 automotive suppliers with QS-9000. Now, even though the design is proprietary, changes impacting form, fit or function need to be evaluated with the customer. This may enhance the partnership nature of customer-supplier relations in some cases. At present, one of us is working with a large Tier 1 that has hundreds of factories worldwide. It is rolling out a Manage the Change process across its several business units. The reason for the rollout is that changes in products and/or processes are causing severe problems for its OEM customer. The organization promised the customer that it would roll out a worldwide program and is now in the process of doing just that, spending a considerable amount of resources and time. Reviewing the existing change process has clarified several factors that this organization needs to consider, including: What types of changes need to be included in the process? Should all changes go through this process, including a document change? How centralized or decentralized should this process be? (Centralization provides for more control, but it results in less speed in making changes.) How many people should be involved in the change process? (More

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people may mean less risk but may result in less speed and more cost.) This implementation effort clarified the importance of managing the change process in regard to the customer, the quality of the product and the organization. Most organizations would be wise to study and implement this process carefully as they revise their QMSs to fully satisfy Subclause 7.1.4.

Subclause 8.2.3, Monitoring and Measurement of Processes

The requirements in Subclause 8.2.3 of ISO 9001:2000 apply to both manufacturing and nonmanufacturing processes. The measurement and improvement of nonmanufacturing processes will be new to QS-9000-registered organizations. Clause 4.1, Quality Management SystemGeneral Requirements, requires an organization to e) monitor, measure and analyse these processes [needed for the QMS], and f ), implement actions necessary to achieve planned results and continual improvement of these processes, after which Subclause 8.2.3 requires that all processes be monitored and measured to demonstrate the ability of the processes to achieve planned results. Our organization recommends that its clients use a business management system (BMS) control plan to plan for and control nonmanufacturing processes. Figure 1 below provides an example from a BMS control plan, a complete version of which would list all processes

Figure 1. Example From a BMS Control Plan

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4 THE INFORMED Outlook

from the process map, including customer-, management- and supportoriented processes (COPs, MOPs and SOPs). Customer expectations affecting these processes, measurements, acceptance criteria and the control methods are listed in the BMS control plan. Control methods can include meetings, persons and/or teams that review the measurables. In this manner, an organization can clearly delegate responsibility and communicate responsibilities throughout the organization, thereby achieving the desired result of Subclause 8.2.3fulfillment of product and process specifications and QMS goals and objectives. In addition to the ISO 9001:2000 requirements, the International Automotive Task Force (IATF) included two additional requirements in drafting ISO/TS 16949:2002 related to the following: Process studies for new manufacturing processes Ongoing process capability. These requirements are contained in 8.2.3.1, Monitoring and Measurement of Manufacturing Processes. What is required in conducting process studies for new manufacturing processes can be found in the customerspecific requirements for PPAP of the Chrysler Group, Ford, GM and/or other OEMs having such requirements. However, 8.2.3.1 also requires process studies to be conducted every time a new manufacturing process is introduced into the organization. When the manufacturing process study is conducted, production specifications and objectives for manufacturing process capability, reliability, maintainability and availability need to be documented. This requirement parallels what is found in 7.3.3.2, Manufacturing Process Design Output, which is appropriate. An organization can follow the same process for design and development of manufacturing processes when it introduces a new manufacturing process. The second requirement contained in 8.2.3.1 that warrants examination is an ongoing process capability requirement. ISO/TS 16949:2002 specifies that the manufacturing process needs to maintain the process capability or per 2003 by INFORM

Reprint: June 2003

formance that it had when it obtained initial product approval, but on an ongoing basis. For organizations using PPAP, a Ppk >1.67 was required for initial product approval. This means that an organization needs to maintain its initial capability study performance levels on an ongoing basismaintaining Ppk >1.67 or whatever the value was when the initial study was done. view information on g) recommendations for improvement. These opportunities for improvement are to be discussed during the review, with the output to include decisions and actions related to a) improvement of the effectiveness of the [QMS] and its processes, b) improvement of product related to customer requirements,. Once Top Management has decided on the improvements to be made and allocated resources toward their accomplishment, then continual improvement in line with Subclause 8.5.1 can take place. In effect, the continual improvement cycle that begins with Clause 8.4 and moves to 5.6 concludes with 8.5.1, which states: The organization shall continually improve the effectiveness of the quality management system through the use ofanalysis of dataand management review. In other words, the opportunities for improvement identified in the analysis of data is reviewed and resourced in Management Review. This becomes the same improvement monitored in Subclause 8.5.1. With the ISO/TS 16949:2002 additions to ISO 9001:2000, Analysis of Data is part of an even larger QMS relationship involving customer satisfaction (8.2.1), conformity to product requirements (7.2.1, 8.2.2.3, 8.2.4 and 8.3), characteristics and trends of processes and products (4.1, 8.2.3 and 8.2.4) and suppliers (7.4.3.2). Because of this larger relationship, the data to be analyzed must come from many sources. For instance, the customer satisfaction data to be analyzed is not to consist only of customer perception data, customer score cards and/or customer dissatisfaction data, but it must also include the data specified in 8.2.1.1, Customer SatisfactionSupplemental, in ISO/TS 16949:2002. And the data for conformity with the TSs product requirements is gathered during contract review (7.2) and then documented in pre-launch and production control plans. This data is probably captured in monthly statistical process control (SPC) reports for special characteristics and in nonconforming data for all the other characteristics. Another source of data with the TS is derived by meeting 8.2.2.3, Product Audit, which requires an organization to
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Clause 8.4, Analysis of Data

Clause 8.4 in ISO 9001:2000 requires an organization to not just collect data about the organizations processes and product, but to use that data to make decisions about the QMS. Data needs to be collected and analyzed to provide the organization with four types of information: Customer satisfaction Product conformity Process- and product-related characteristics and trends Supplier. This comprehensive data analysis is designed to verify the suitability and effectiveness of the system and to identify potential targets for continual improvement, the second of which was not present in QS-9000. There is an expected relationship between Clauses 8.4 and 5.6, Management Review, and Subclause 8.5.1, Continual Improvement. Clause 8.4 states: The organization shall determine, collect and analyse appropriate data to demonstrate the suitability and effectiveness of the quality management system and to evaluate where continual improvement of the effectiveness of the quality management can be made. In other words, the analysis is not causal, but it is used for the purpose of showing the effectiveness of the QMS and identifying where continual improvement can be made. The opportunities for continual improvement identified as a result of 8.4 are reviewed by Top Management in conforming with Clause 5.6, Management Review, which states: The review shall include assessing opportunities for improvement and need for changes. Further, Subclause 5.6.2, Review Input, requires as one of the inputs to Management Re-

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audit products at appropriate stages of production and delivery to verify conformity to all specified requirements,. Measurement and monitoring of processes related to the organization is required in Clause 4.1 and Subclause 8.2.3. Our organization recommends that its clients again use their BMS control plans described earlier to plan and assign overall responsibilities for the measurement and monitoring of processes. Except for key processes (e.g., product realization, design and development or manufacturing) that may be monitored by Top Management, all others are probably measured locally by departments. Therefore, the organization has to assign responsibility for the analysis of data. This responsibility may be decentralized or centralized, but the result should be information that identifies potential opportunities for improvement, as described earlier. In effect, Clause 8.4 requires an organization to establish data management plans. Your organization will need to determine who will collect the data and to what aggregation level. The aggregation of the data has a direct impact on data analysis. Aggregation levels should correspond to the level of detail required for conducting data analysis. For example, delivery data gathered by the customer would identify how well your organization is meeting customer delivery requirements, but it would not tell you what productsand which of your departmentswere late. If this type of data analysis is required, then your organization needs to gather sufficient data by customer and department as well as by product. This sort of data aggregation would allow analysis by department and product as well as by customer. Finally, for data management and aggregation, you have to consider where the data is available, who will collect it, who will analyze it and what type of information is required for problem-solving and continual improvement. Most organizations will obtain large savings through the use of good data management plans and automated data collection. In most organizations, a variety of employees gather the same type of data in several different ways.
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Worse yet, this data often is not in agreement. If this data can be collected once in an effective and efficient way, made available to everyone who needs it and acted on by all in the same way, it will lead to immense savings and real benefits for the organization. So far, we have been discussing the ISO 9001:2000 requirements for analysis of data. ISO/TS 16949:2002 adds Subclause 8.4.1, Analysis and Use of Data. What Subclause 8.4.1 does is add requirements, as stated in its title, for the use of data and states: Trends in quality and operational performance shall be compared with progress towards objectives and then lead to action. Quality and operational performance data can be thought of as measurements related to the product realization process as required in Clause 4.1 and Subclauses 5.1.1, Process Efficiency, and 8.2.3. However, 8.4.1 requires this data to be compared with progress toward objectives. The overall objectives are to be set by Top Management (per Subclause 5.4.1) and then deployed into the manufacturing plants, where specific quality and operational performance data can then be tracked. Subclause 8.4.1 also relates this data analysis to addressing overall customerrelated problems and trends. The operational and quality data analyzed needs to be compared with progress toward objectives and then lead to actions for improvement as required, including the provision of prompt solutions to customer-related problems and determination of trends affecting the customer. Determining trends must contribute to status review, decision-making and longer term planning so as to identify issues to be addressed and processes and practices that have positive impacts and need to be maintained and enhanced. 8.4.1 requires linkages between data analysis and customer needs and expectations (per Clause 5.2, Customer Focus) as well as customer satisfaction (per Subclause 8.2.1). Finally, data analysis relating to the customer also needs to be linked to longer term planning (i.e., Subclause 5.4.2, Quality Management System Planning). What is important to take away from ISO 9001:2000s Clause 8.4 and

the TSs Subclause 8.4.1 is that your organization is required not just to collect data. Your organization must collect data that is relevant to measuring the effectiveness of the QMS and its processes and the satisfaction of your customer(s) and then act on this data. ISO 9001:1994 required a great deal of documentation, including of procedures, that made for a nice paper trail but did not always lead to improvement and responsiveness to customer needs. While QS-9000 was more attuned to the pursuit of improvement and customer satisfaction, ISO/TS 16949:2002 represents a more proactive approach to quality management.

Parting Advice to Automotive Suppliers

This concludes our series on the 15 key challenges we have identified for transitioning from QS-9000:1998 to ISO/TS 16949:2002. Other requirements that involve changes have been left out, including the customer-specific requirements that will differ for each organization depending on its customer mix. Transitioning to ISO/TS 16949:2002 is not going to be a piece of cake for most organizations. The prime challenge is becoming customer- and process-focused. These are large culture changes for any organization and it does not happen overnight. In many cases, it does not happen even when your registrar audits you. Sometimes seeds sown by the time of registration do not result in the harvesting of the fruit until years later. Your organization should have a strategy in place when transitioning to ISO/TS 16949:2002 regarding multisite and remote location implementations when this is an issue. Some organizations also have to deal with facilities that serve both automotive and nonautomotive markets. Different organizations will require different strategies with ISO/TS 16949:2002. Additional strategies may be necessary regarding the involvement of Top Management in ISO/TS 16949:2002 implementation and then maintenance. Can Top Management delegate its responsibilities? These are all topics that will be explored in coming months.
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For now, our parting advice to you is this: Implementing ISO/TS 16949:2002 has to produce results. The TS clearly spells out these requirements in 8.2.1.1, Customer Satisfaction Supplemental, which requires metrics on delivered quality performance, customer disruptions (including field returns), delivery schedule performance (including premium freight) and customer notifications related to quality and delivery issues. These not only apply to the organization, but to its suppliers (per 7.4.3.2, Supplier Monitoring). How you and your registrar cope with these challenges and your ability to convince Top Management of the need for real change will determine whether your organization has success or failure with ISO/TS 16949:2002 as you move into the future. The IATF is working with the International Automotive Oversight Bureau (IAOB) and the other oversight bureaus to make sure that the ISO/TS 16949:2002 launch is a success. If your organization and other automotive suppliers take the low road, and if your registrar does not focus on providing value-added audit results, then ISO/TS 16949:2002s future wont be straightforward. There could even be a return to individual OEM standards and to second-party auditing. In 1988, when automotive suppliers asked the American Society of Quality to petition the Big Three to standardize their standards, it was because too many standards were being imposed on the supply chain by the OEMs, Tier 1s and even Tier 2. This caused havoc in the industry. ISO/TS 16949:2002 is a move in the right direction, harmonizing expectations in the global automotive supply chain. It is going to be difficult to achieve standardized TS implementation, registration and use across the world, especially with several different oversight bureaus involved in different parts of the world. Much clarification of OEM, IATF and oversight bureau expectations needs to occur for ISO/TS 16949:2002 to be implemented worldwide in a consistent and effective manner. The industry is rising to this challenge of increased expectations with ISO/TS 16949:2002, which it is hoped will provide additional value to suppliers and better results for the OEMs. ### Chad Kymal is Chief Executive Officer of Omnex, Inc., an international consulting, training and software organization specializing in business quality improvement methodologies. Omnex has worked with hundreds of organizations to meet the requirements of ISO 9001/2/3, QS-

Reprint: June 2003

9000 and ISO/TS 16949 worldwide and to obtain registration. He assists organizations worldwide in his capacity as a consultant and trainer and also serves as a Lead Auditor for AQSR, an accredited registrar that is qualified to conduct ISO/ TS 16949:2002 assessments. Mr. Kymal served in the past two years on the Malcolm Baldrige National Quality Award Board of Examiners, has a BSME from General Motors Institute and has an MS in Industrial Operations Engineering and an MBA from the University of Michigan. He is also author of Auditing ISO 9001:2000, published by Paton Press (www.patonpress.com), and is currently working on a book on ISO/TS 16949:2002. Mr. Kymal can be contacted by e-mail (ckymal@omnex.com). David Watkins is President of Omnex, Inc., and is a senior trainer/consultant. He has a wide range of international experience focused on enhancing the ability of organizations to create value for their customers and stockholders and integrating QMSs and other management systems to enhance performance. Mr. Watkins can be contacted by e-mail (dwatkins@omnex.com).

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