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Herb Clifford and John Martin It's a term that's been compared to "The Good Housekeeping Seal of Approval." It assures that products are produced by meeting well-defined standards of quality and consistency. And, for many companies and industries, it's fast becoming a requirement of doing business. In fact, more and more, marketing and salespeople of small- to mid-size manufacturing and supply companies are being asked by their customers to demonstrate that they are International Standards Organization (ISO) certified. In light of this, marketing and sales managers are beginning to view ISO certification as an important element in their sales success. In 1987, the International Organization for Standardization set three quality management standards to assure vendor quality. ISO 9001 certifies those companies that do design and development, product manufacturing, installation, final inspection and testing, as well as supplying and maintaining software. ISO 9002 covers companies doing production and installation and ISO 9003 affects companies that handle final inspection and testing. ISO certification requires that a company must set up and document all of its procedures including the procurement and storage of materials, the manufacture and delivery of products, employee training and customer support. Originally, ISO involved only those companies doing business in Europe. Today, however, businesses that supply those companies (many of which are smaller firms that do business only in the states) are being asked to meet ISO certification. The reason? The European Community requires companies in some specifically regulated industries that sell products in Europe, not only be ISO-certified themselves, but also that they purchase only from suppliers and vendors that are also ISO-qualified. More and more, large businesses, most of whom do business in Europe and are already certified, are requiring that their smaller suppliers here in the states are certified. The standards were developed to help manufacturers and service providers in the international marketplace develop a quality conscious approach for their research, testing, manufacturing and support operations. Preparing for ISO 9000 certification can cost a small- to mid-size company from $25,000 to $50,000 in consultant fees, training programs, auditing costs and registration. Because of these prohibitive costs, some uncertified companies are finding themselves blocked from significant business opportunities. Still, production and quality assurance managers who support ISO say that the process produces performance improvements and cost savings over the long term. Rethinking and documenting every aspect of a corporate process can help identify and eliminate weaknesses and low productivity areas. Managers also note that the payback from cost savings usually occurs within a three to five-year period. Skeptics point out that going through the certification process creates increased paperwork and takes time away from other issues. They argue that the long-term cost savings may not be worth the investment. For marketing and sales managers, however, the real issue of value is quickly becoming one of sales and profits. Those who can readily answer "yes" to the question of certification say they do have a competitive advantage because ISO is a powerful marketing tool and an effective form of differentiation. According to quality assurance manager Joe Greene, Crosby Valve and Gauge Company realized the need for certification when one of its major international customers required that its successful bidder be certified. "The need for certification was clear, and we found that compliance to the standards was a natural progression in our quality improvement process," Greene said. "The certification effort not only improved our processes and products, but also helped demonstrate Crosby's commitment to our customers." Already certified companies are using ISO to effectively market and sell their products and services. Those who are not certified are under increased pressure from marketing and sales managers to make the investment. EMC Corp., a maker of data storage devices and one of its state's leading growth companies, is a strong advocate for certification. CEO Michael Ruettgers has this advise to those on the fence: "When the time comes for your firm to decide on ISO, don't hesitate. The resultant revenue jumps, system improvements and employee enthusiasm make it worth the hurdles." About the authors Herbert Clifford and John Martin are Associates of Q/P Management Group, Inc. © Copyright, 2000-2002. Q/P Management Group, Inc. Proprietary and Confidential. All Rights Reserved. |
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