ECSI Blog

 The choice to implement an ISO-type management system (14001, 9001, OHSAS 18001) is an important step for management to take toward sustainability. Mature and ready organizations understand that a proactive approach to managing risk is almost always the best approach for the business.  Managers also understand that any investment made in a management system needs to provide an attractive return, just like any other investment the organization might make.  Organizations need to avoid making mistakes while implementing a management system—mistakes that can dramatically limit the ability of the system to pay off.  Here are a few common misunderstandings/mistakes that often hinder organizations.

Misunderstanding the Purpose

The purpose of a management system should be to help an organization in systematically managing risks that threaten the organization.  Often, we find that organizations believe that the purpose of the management system is to “pass an audit” and satisfy customers’ or other stakeholders’ needs.

Organizations that recognize the value in investing in a management system to help them improve performance are much more likely to implement an effective system that easily passes audits.  Organizations that view the purpose of the of the management system as simply to pass an audit, on the other hand, usually implement an ineffective system that makes passing the audit more difficult.

Operating the System in Silo

Organizations new to management systems sometimes unknowingly establish the system in a “silo.” As a result, the system is operated almost in isolation from other business processes. This silo system is most common in organizations where the primary objective of implementing a system was to pass an audit rather than to enable to organization to continually improve its performance. 

Over-Documenting the System

In the past, the management system mantra was “Document what you do and do what you document.”  This led some organizations to over-document their systems to the point that they were overwhelmed with too many documents, many of which did not have a clear purpose.  Today, each document in the system needs to have a clear purpose and communicate important information like who does what, when, where, and how.

Investing Too Little in the Internal Audit Process

A good internal audit is key to an effective management system.  Skilled auditors can assist an organization in identifying potential risks before they turn into real problems.  Some organizations view internal audits as something they need to do to meet a requirement of a particular standard and to maintain their certification.  They put too little effort into training auditors, and as a result, the audits performed provide little or no information about the performance of the system.  Investing in auditor competence is a must if the system is to be effective, and if it is to provide an attractive return on investment.  Not all organizations have persons who are interested or capable of performing good audits, and the investment of achieving and sustaining an adequate level of competence is not cost-effective.  For this reason, some organizations are choosing to out-source their internal auditing needs, and with excellent results.

Misunderstanding the Corrective Action Process

Internal and external audits discover potential problems, and the corrective action process should fix them.  However, misunderstanding the corrective action process can  lead to the inability of an organization to address the problems or to take actions to permanently fix the problems.  Corrective actions need to be tracked and reviewed frequently, and the actions taken need to be based on the root cause of the problem and cannot be just a band-aid to temporarily stop the bleeding.  Many organizations find value in some type of corrective action tracking software that will help them keep on top of open corrective actions.

Reviewing Management Inputs Too Infrequently

A well-engineered management system collects information about the performance of the organization and presents it to top management in an “actionable” form.  If management review is viewed as a once- or twice-per-year activity that  needs to be done only to satisfy an auditor, the system is likely to fail to achieve its objective.  Elements of management review should be integrated with the other regular business management meetings, where the financial performance of the organization is reviewed.  Management review inputs like the status of corrective actions or the progress toward meeting system objectives should be reviewed more frequently than once or twice a year to avoid surprises. 

Poorly Defining Performance Objectives and Measurements

Performance measurements are sometimes referred to as “metrics.”  These metrics are measurements an organization makes to periodically check how well it is doing toward achieving performance objectives.  The performance objectives must be chosen carefully and must have extended duration for performance improvements.  An example of a poor objective would be “replace all lights.”  An objective like this is not measureable. It is actually a task to be performed as part of a larger objective, which is “to reduce energy consumption.” 

Performance measurements should also be tied to some measure of production.  This is sometimes called “normalizing the measurement” to adjust for increased or decreased production levels.  Normalizing the measurement makes it more meaningful to management.