STANDARDS OUTLOOK
DAN REID
Putting Things In Context
Implementing new requirements in ISO 9001:2015
IT CAN BE argued that ISO 9001:2015
enhances the role quality management
systems (QMS) play in the success of
an organization and its business pro-
cesses. Evidence of this, in part, is in a
new requirement in subclause 4.1 titled,
“Understanding the organization and its
context.”
This subclause requires an organiza-
tion to “determine external and internal
issues that are relevant to its purpose and
its strategic direction and that affect its
ability to achieve the intended result(s) of
its quality management system.”1
ISO 9000 adds that the “creation of
unity of purpose and the direction and
engagement of people enable an orga-
nization to align its strategies, policies,
processes and resources to achieve its
objectives” (see Figure 1, p. 68). It also
2
asserts: “Leaders at all levels establish
unity of purpose and direction and
create conditions in which people are
engaged in achieving the organization’s
BY R.
quality objectives.”3
The 2008 version of ISO 9001 men-
tioned the “purpose” of the organization
only in the context of ensuring that a qual-
ity policy is appropriate to that purpose.
It did not mention the strategic direction
of an organization, perhaps because the
QMS was not previously thought to be a
boardroom topic necessarily.
The new concept of context in sub-
clause 4.1 also requires that the issues that
can affect the intended results of the QMS
be determined. This means these intended
results or outcomes of the QMS must
be determined up front. Figure 1 shows
intended outcomes as an output of the
scoping of the QMS.
Finding purpose
The purpose and strategic direction of an
organization are traditionally boardroom
topics. There are differing views on what
the purpose of an organization is. It has
been defined as: “to accomplish the goals
and objectives as indicated within the or-
ganization’s vision statement. The mission
statement will indicate how [the organiza-
tion] plan[s] on reaching those goals and
objectives.”4
The purpose has also been defined as
“to serve and satisfy its customers.”5 This
follows the logic that businesses exist to
serve customers, so customers are more
important than stockholders, workers or
management. Without customers, there
is no business. ISO 9001:2015 deals with
customers in a broader fashion by describ-
ing them as “interested parties,” but more
on that later.
Others could argue that the purpose of
a for-profit organization is to make money,
and that for not-for-profit organizations,
it is to serve some segment of society in
some prescribed way. Curiously, in ISO
9001:2015, purpose and strategic direction
are not defined, but both terms are used in
the new context requirement in subclause
4.1.
The word “mission” is defined as an
“organization’s purpose for existing as
expressed by top management.”6 Because
mission is defined as the purpose, mission
is shown as an input for determining the
context in Figure 1 and is a good starting
point for engineering or reengineering a
QMS.
Defining context
In ISO 9001, context is defined as “the
combination of internal and external
issues that can have an effect on an orga-
nization’s (subclause 3.2.1) approach to
developing and achieving its objectives.”7
ISO 9000 offers more guidance. “Under-
standing the context of the organization
is a process. This process determines
December 2015 • QP 67
 STANDARDS OUTLOOK

factors which influence the organization’s

purpose, objectives and sustainability. It
Planning the quality management
considers internal factors, such as values, system—ISO 9001:2015-related
culture, knowledge and performance of clauses / FIGURE 1
the organization. It also considers external
factors, such as legal, technological, Mission
competitive, market, cultural, social and
economic environments. Examples of the
ways in which an organization’s purpose Strategic Understanding
Interested party
expectations
can be expressed include its vision, mis- direction context (4.1)
(4.2)
sion, policies and objectives.”8 The issues
to be determined are those that:
Relevant?
• Are relevant to the organization’s pur- (4.1, 4.2)
pose.
• Are relevant to the organization’s stra- (Re)scope of Intended
tegic direction. management outcomes
system (4.3)
• Can affect its ability to achieve the
intended results of its QMS.
Policy Quality policy
development
(5.2.1)
External issues
External issue examples include:
Technology. New technology has Resources (7.1)

the potential to make current products Identification of risks

Identify risks and
or services obsolete. “Business leaders andopportunities
opportunities Process Documented
Processes (4.4) information (7.5)
(6.1) controls (8.1)
should keep their organizational strategies
updated in the face of continually evolving Objectives
technologies, ensure that their organiza- setting and Plans
planning (6.2)
tions continue to look ahead and use tech- Objectives
nologies to improve internal performance. Documented
Disruptive technologies can change the information (7.5)

game for businesses, creating entirely new check

products and services, as well as shifting
pools of value between producers or from Data (9.1.3) Metrics (9.1.1)

producers to consumers.” 9
Technology’s impact on a QMS involves
organizational knowledge. “When ad-
dressing changing needs and trends, the
organization shall consider its current
knowledge and determine how to acquire
or access any necessary additional knowl-
edge and required updates.”10
Competition. A privately owned
stamping organization has a much differ-
ent competitive landscape from that of a
turbocharger manufacturer. Competition
typically drives prices down and quality
and service up. These issues emphasize
the critical need for good benchmarking,
process effectiveness and efficiency, and
can affect the amount of documented
information needed and the amount of
resources that are available.
Litigation profile of the organi-
zation. How much risk is involved in
the product or service the organization
Yes
On target?
No
Corrective
action (10.2.1)
provides? Due to the nature of their busi-
nesses, pharmaceutical organizations,
hospitals and utility companies must act
on the risk in their QMSs much differ-
ently and more diligently than does a
manufacturer of cloth gloves. Problems
with their product or service can result in

68 QP • www.qualityprogress.com
Technology’s impact on a quality management
system involves organizational knowledge.
lawsuits, which can be costly regardless
of outcome. Legal costs just to mount a
defense are significant. This requires bet-
ter planning and risk mitigation through
improved design, process controls and
error-proofing.
Regulatory environment. Product
and service sectors may be required to
comply with regulatory and statutory
requirements that can be ambiguous and
complex. Often, organizations need a
regulatory consultant to help identify and
deal with the applicable requirements.
This affects the new requirement for orga-
nizational knowledge.
Customer-specific requirements.
Some sectors, such as automotive and
aerospace, require third-party certifica-
tion to ISO 9001-based QMS standards.
Suppliers also are obligated to comply
with additional customer-specific require-
ments, which add significant complexity
as organizations operate at lower levels of
the supply chain.
Organizations at the top require their
suppliers to flow down their requirements
to their suppliers. These suppliers typi-
cally add their own requirements and pass
them all down to their suppliers. Add to
that the need for second-party, on-site as-
sessments to determine conformance, and
organizations are forced to deal with a lot
of work for little added value. This affects
resources, supplier management (control
of externally provided processes, products
and services), data and documented
information.
Union or nonunion. This also could
be argued as an internal issue. Regardless,
this can affect a quality system in several
areas, such as communication, awareness,
competency and policy.
Geographical. Delivery can be more
complex to manage depending on where
the organization is located and with what
customers it chooses to contract. Export-
ing of products, as well as added regula-
tory issues increases inventory to the
supply pipeline and carries more risk for
design changes.
Some locations are prone to natural
disasters—such as being in a flood plain
or earthquake zone—which places a
premium on business continuity planning
and supply chain risk mitigation, which is
costly at best.
Internal issues
Examples of internal issues include:
Resources. About the time of the
economic turmoil in 2008, many organiza-
tions elected to downsize by reducing
headcount. No doubt, many people who
were left working in these organizations
were required to do what had been the
work of several others, in addition to their
own work.
Without reengineering the processes in-
volved, this dramatic cut in resources can
significantly affect an organization’s QMS
and, arguably, its ability to achieve its
purpose. Technical human resources—en-
gineers and quality practitioners—can be
hard to replace. This emphasizes the need
for capturing organizational knowledge,
another new requirement in the ISO 9001
revision.
Other assets, such as infrastructure,
also must be considered. Information
systems are now at the forefront of key
processes that support a QMS through
control of documented information, such
as procedures and records. Outdated or
insufficient IT can harm the effectiveness
and efficiency of a QMS and its intended
outcomes.
Organizational structure. Is your
organization a more traditional, pyramid
structure or a matrix organization where
a worker has more than one supervisor?
This structure can affect various elements
of the QMS, including subclauses:
• 5.3 on organizational roles, responsi-
bilities and authorities.
• 7.4 on communication.
• 7.1.6 on organizational knowledge.
Are the authorities for work adequately
and effectively specified and aligned
with the responsibilities assigned? ISO
9001:2015 requirements for communica-
tion include determining the who, what,
when and how for internal and external
communications and the target audience.
Knowledge is described as knowledge
specific to the organization gained by ex-
perience that is used and shared. Quality
guru Philip B. Crosby indicated commu-
nication is hard work. If you don’t plan
for it and work at it, it does not happen.11
Complexity in organization structure and
related issues can affect a QMS.
Products and services. Even the
product and service offerings the organi-
zation chooses will affect a QMS. Product
complexity, volume, target markets and in-
tended application are all issues that must
be decided, planned for and effectively ad-
dressed. Clearly, this can affect resources,
organizational knowledge, infrastructure,
competency and other QMS elements.
Interested party needs and ex-
pectations. In ISO 9001:2008, the term
“interested party” was not used. It was
addressed in ISO 9004:2008: “ISO 9004
provides a wider focus on quality man-
agement than ISO 9001; it addresses the
December 2015 • QP 69
 STANDARDS OUTLOOK
needs and expectations of all interested
parties and their satisfaction, by the
systematic and continual improvement of
the organization’s performance.”12
There is now a requirement (sub-
clause 4.2) to include the requirements
of relevant interested parties within the
QMS. ISO 9000 adds guidance: “Relevant
interested parties are those that provide
significant risk to organizational sustain-
ability if their needs and expectations are
not met.”13
Interested parties can affect the level
of control expected for the design and de-
velopment process.14 Feedback from rel-
evant interested parties must be included
in the management review process.15
The quality policy must be available
to relevant interested parties, as appro-
priate.16 Examples of interested parties
include providers, partners, customers,
investors, employees or society as a
whole.17 Determining interested party
needs and expectations is now an input to
the scoping of a QMS (see Figure 1).
Note that the intent of the standard is
that the organization determine which
interested parties are relevant. An organi-
zation could take a minimalist approach
to this and exclude some parties or re-
quirements that may, in fact, be relevant.
Certainly, auditors of a system will need
to audit the criteria used and determine
the effectiveness of an organization’s
conclusions.
Revising your QMS
Context and interested party expecta-
tions are not the only clauses that must
now be considered in planning. Figure 1
depicts one way to look at the planning
and implementation of major elements
of the revised standard. It could be
argued that processes such as objectives
setting, resource allocation and QMS
processes are not actually sequential or
in the order shown in Figure 1, which is
true enough. The important takeaways
70 QP • www.qualityprogress.com
from Figure 1 are:
Linkages. A link to the mission and
strategic direction of the organization.
The scope or rescoping of a QMS.
The scope of a QMS may change. The
scope defines what is included in a QMS.
The definition of “management system”
now provides for a narrow scope of one
or more functions or disciplines inside
an organization, as well as the entire
organization.
While there is no longer an explicit
provision for exclusions in the standard,
minimalists could argue that the appli-
cable requirements from the standard
that must be included in the management
system can be those applicable to only
one or more functions rather than the
whole organization.
Organizations that choose to do this
will make life difficult for customers that
require third-party certification unless the
customers address this issue in customer-
specific requirements. The addition of
interested party needs and the context
requirement could, on the other hand,
require a scope expansion.
QMS outcomes. The standard refers
to the QMS outcomes, creating a need for
determining them.
Identification of risks and oppor-
tunities. Standards writers point out
that the concept of risk has always been
inherent to ISO 9001, but it is now an
explicit requirement. Full risk manage-
ment is not required, but risks must
be determined and addressed. Risks
pertaining to products, processes and
suppliers should be included. Identified
risks will need efforts to mitigate them
through design and process controls and
verification activities.
Objectives. The continued use of
enterprise-level objectives that are to be
deployed and aligned with more specific
objectives at relevant levels and functions
inside an organization is key and is main-
tained from past versions of the standard.
Objectives should be measure-
able and time based. They should be
reset after they are achieved to drive
improvement. Metrics must be monitored
and acted on as necessary to achieve
planned results. Good metrics drive good
behavior; just as bad ones drive wrong
behavior. Be sure to choose wisely. QP
REFERENCES
1. International Organization for Standardization (ISO), Final
Draft International Standard ISO 9001:2015—Quality
management systems—Requirements, Subclause 4.1—
Understanding the organization and its context.
2. ISO, Final Draft International Standard ISO 9000:2015—
Quality management systems—Fundamentals and
vocabulary, Subclause 2.3.2.2—Rationale.
3. Ibid, Subclause 2.3.2.1—Statement.
4. Answers.com, “What is the Purpose of an Organization?”
Oct. 4, 2015, http://tinyurl.com/purposeoforg.
5. Angelfire.com, “The Purpose of Business Organization,”
Oct. 4, 2015, http://tinyurl.com/q53hgtp.
6. ISO, Final Draft International Standard ISO 9000:2015—
Quality management systems—Fundamentals and
vocabulary, Subclause 3.5.11—Mission.
7. Ibid, Subclause 3.2.2—Context of the organization
(terms).
8. Ibid, Subclause 2.2.3—Context of an organization.
9. James Manyika, Michael Chui, Jacques Bughin, Richard
Dobbs, Peter Bisson and Alex Marrs, “Disruptive Tech-
nologies: Advances That Will Transform Life, Business and
the Global Economy,” McKinsey & Co., Oct. 4, 2015, http://
tinyurl.com/nmbecug.
10. ISO, Final Draft International Standard ISO 9001:2015—
Quality management systems—Requirements, Subclause
7.1.6—Organizational knowledge.
11. Philip B. Crosby, Quality is Free: The Art of Making Qual-
ity Certain, McGraw-Hill, 1979.
12. ISO, ISO 9001:2008—Quality management systems—Re-
quirements, Subclause 0.3—Relationship with ISO 9004.
13. ISO, Final Draft International Standard ISO 9000:2015—
Quality management systems—Fundamentals and
vocabulary, Subclause 2.2.4—Interested parties.
14. ISO, Final Draft International Standard ISO 9001:2015—
Quality management systems—Requirements, Subclause
8.3.2—Design and development planning.
15. Ibid, Subclause 9.3.2—Management review inputs.
16. Ibid, Subclause 5.2.2—Communicating the quality policy.
17. ISO, Final Draft International Standard ISO 9000:2015—
Quality management systems—Fundamentals and
vocabulary, Subclause 2.3.7.4— Possible actions (rela-
tionship management).
R. DAN REID is the director of
standards and consulting at Omnex
Engineering and Management in
Ann Arbor, MI. He is an author of
ISO Technical Specification 16949,
QS-9000/QSA, ISO 9001:2000, the
first International Organization
for Standardization international
workshop agreement, the Chrysler, Ford, GM Advanced
Product Quality Planning With Control Plan, Production Part
Approval Process and Potential Failure Modes and Effects
Analysis manuals and the AIAG Business Operating Systems
for Healthcare Organizations. Reid was the first delegation
leader of the International Automotive Task Force. He is an
ASQ fellow and an ASQ-certified quality engineer.