Chapter 4 of ISO 9001:2015 explains how to understand the organization and its context. While this is often referred to as a new requirement that was not present in the previous version of the standard, ISO 9001:2008 clearly stated that the quality system is influenced by the environment in which it operates and by any changes that may occur in that environment.
In this sense, we cannot consider it entirely new, although it is in its current form. Some organizations have struggled to understand why attention should be paid to the external environment in which they operate and why it is no longer sufficient to simply continue doing what has always been done.
To explain this, it is enough to remind them that the external environment also includes potential competitors capable of offering their customers something better, prompting them to switch suppliers. It is clear, therefore, that keeping a watchful eye on what happens outside the company is always advisable, as it can influence its operations. Many requirements are linked to this Chapter 4. Let's review them together:
- 4.2 – Understanding the needs and expectations of interested parties;
- 4.3 – Determining the scope of the quality system;
- 4.4.1 – Determining the processes necessary in a quality system;
- 6.1 – Managing risks and opportunities;
- 8.1 – Planning and control;
- 9.1.3 – Analysis and evaluation;
- 9.3 – Management review;
- 10.1 and 10.2 – Improvement
It is evident, therefore, how this "new" concept is deeply embedded in this updated version of ISO 9001. In this article, we will specifically examine the first requirement of Chapter 4, namely, Clause 4.1 "Determining internal and external factors." Clause 4.1 of UNI EN ISO 9001:2015 contains several terms that should be well understood to ensure proper application of the standard. Let's analyze them one by one.
Starting with "internal and external factors." The generic term "factors" usually refers to something that can have a particular impact, and indeed, the note in the text states that this impact can be either positive or negative. The "purpose of the organization," on the other hand, refers to what an organization does. Regarding the factors mentioned above, they should be identified among those that have some potential to influence the achievement of this purpose. But what exactly is the purpose of an organization? Answering this question is easy because it is the very reason the organization exists.
Clearly, the answers may vary depending on how a person views the organization itself. For example, a factory owner might think that the purpose of their organization is to make money, while a nurse might believe that the purpose of a hospital is to care for the sick admitted there. Similarly, a sales representative in a computer manufacturing company might consider the goal of their company to be placing a computer on every desk in the country.
None of these perspectives are incorrect, but Drucker helps clarify by distinguishing between the purpose of a business (the reason an organization exists) and its function (what it does). Be careful not to be misled: the products or services of an organization do not represent its purpose, but rather the value that customers (or users) derive from owning, using, or benefiting from them. This brings us to the term "strategic direction." Strategy is nothing more than a broad and comprehensive plan explaining how an organization intends to fulfill its identified purpose. However, strategic direction goes even further because, among all the possible paths to achieving a goal, it ensures that the organization chooses the one it believes is best aligned with its vision.
The final term to understand Clause 4.1 of the standard is "ability to achieve intended results." A quality system should not be a mere set of requirements and procedures but a systemic vision of an organization from the perspective of those who acquire and seek to retain customers over time. A systemic vision is a model created from the perspective of those who see the organization as an entity striving to reach new objectives. Since one of the goals of a quality system has always been to ensure that products or services comply with customer requirements, regulations, and legal requirements, it is evident that this is one of the expected outcomes of correctly implementing a quality system.
In Clause 0.1, the standard highlights additional expected outcomes:
- Compliance with ISO 9001;
- Customer satisfaction;
- Beyond these three expected results indicated in the standard, we can also include the satisfaction of all stakeholders.
Having clarified the terminology of the clause, let us now understand why we need to determine which internal and external factors may influence (positively or negatively) our quality system. Identifying the key issues to focus on means, first and foremost, prioritizing tasks and ensuring that the entire system, composed of interconnected elements, functions in a way that achieves a specific result. Once the purpose of an organization is established, the strategy to follow is determined, the system to implement it is designed, and the elements necessary for the system to function are identified.
If the work is done correctly, the expected results should be achieved, and stakeholders should be satisfied. Each organization is different from another precisely because certain issues affect it and its quality system uniquely. Therefore, a quality system is unique and cannot simply be copied and adapted from another organization. Certainly, some routines may work effectively in two different companies facing the same situation, but there are too many variables to expect that the strategies, policies, objectives, and processes of one organization will work equally well in another unless it is a cloned entity, such as in some franchise businesses.
Regarding the purpose of an organization, ISO 9001:2015 acknowledges that each entity is formed with a specific purpose in mind. Keeping this in mind, strategies should be defined, and any issues that could act as drivers or barriers to achieving this purpose should be continuously monitored.
Purpose, strategy, and the identification of internal and external factors that may influence them are all outputs of the strategic planning process, which starts with clarifying purpose and objectives, moves on to environmental analysis, and develops a strategy that is then translated into policies, actions, measurements, and so on. To design an effective quality system, it is essential to have a broad vision and a deep understanding of the organizational system context, of which the quality system is merely a subsystem. The first step in clarifying an organization's purpose is to answer the following questions:
- “What do we do, or why do we exist?”
- “How do we do it?”
To answer this question, it is necessary to identify the main methods and activities the organization uses to fulfill its previously identified purpose.
- “For whom do we do it?” Answering this question identifies the organization's primary target audience.
- “What is critical to our success?”
To answer this question, all internal and external factors that may hinder or facilitate the achievement of our purpose must be identified. Once these four questions are answered, the next step is to analyze the internal and external environment, specifically:
- Identifying stakeholders
- Managing any changes related to stakeholder needs, always keeping the organization's purpose in mind
- Determining and continuously confirming the best metrics to ensure that we are effectively meeting stakeholder expectations