Organizational Context
Since the new versions of ISO 9001 and 14001 were released in 2015, and conversion from older versions is due by 9/15/2018, in the next few issues we will look at some of the new concepts and their application.
Context of the Organization:
This first new concept is essential to any well-run company, and is a critical precursor to defining and reviewing ongoing strategy and objectives. While many new businesses start with a great idea or a core skill, and a business plan, over time it is easy for strategic planning to fall by the wayside in the day-to-day activities. Yet, as the old saying goes, if you don’t know where you’re heading, you’ll probably end up somewhere else.
In the new architecture of ISO standards, clause 4 Context of the Organization asks top management to define, monitor and review the External and Internal Issues that are relevant to your purpose and strategic direction and that affect the company’s ability to achieve the intended results of your QMS or EMS. The supplemental notes in this clause and in the Annex explain this well. Unlike the proverbial ostrich with its head in the sand, effective management monitors changing internal and external conditions. This is often done as part of management review.
Purpose and strategic direction: are often defined at business inception – Effective companies and leaders continue to review them periodically to ensure that operational decisions and investments continue to align with company purpose and strategy.
Issues: can include positive and negative conditions that need consideration – in other words, if it affects the business, put in on the list.
External Context: can include issues arising from legal, technological, competitive, market, cultural, social, and economic environments - locally, nationally and internationally. Areas to consider could include: Exchange rates, credit availability, economic forecasts, unemployment rates, safety perceptions, skill and education levels of labor pool, public holidays, political stability, local infrastructure, international trade agreements, technology advancements, materials and equipment availability, patent expirations, professional associations, competitors market offerings and benefit packages, market leader trends, customer growth trends, supply chain relationships, regulatory requirements and changes.
Internal Context: can include values, culture, staff education levels and knowledge, and performance of the organization. Areas to consider could include: Overall performance to objectives, resources such as infrastructure, work environment, organizational knowledge, staff competence, organizational behavior and culture, capabilities, capacity, customer satisfaction, tools and processes for decision making.
Possible tools: At the strategic level tools such as SWOT (Strengths, Weaknesses,
Opportunities and Threats) analysis, or PESTLE (Political, Economic, Social, Technological, Legal, Environmental) analysis, or a simple list of brainstormed issues and needed actions assigned to different people.
Whatever the tools you use, the context must be reviewed regularly to ensure that QMS activities and objectives are relevant to the purpose and strategic direction and context of the organization.
