35th International Conference on Computers and ...

STRATEGIES AND CRITICAL SUCCESS FACTORS FOR INTEGRATED MANAGEMENT SYSTEMS IMPLEMENTATION Musli Mohammad, Mohd. Rasid Osman1, Rosnah Mohd. Yusuff2 & Napsiah Ismail3 Department of Manufacturing and Industrial Engineering, Faculty of Mechanical and Manufacturing Engineering, Kolej Universiti Teknologi Tun Hussein Onn, 86400, Batu Pahat, Johor, Malaysia [email protected] Department of Mechanical and Manufacturing Engineering, Faculty of Engineering, University Putra Malaysia, 43400, Serdang, Selangor, Malaysia 1 [email protected], [email protected] & [email protected] Tel: 100-603-89466343, 200-603-89466342 & 300-603-89466336 Fax: 00-603-86567122

Abstract:This paper discusses the strategies and factors that are critical for IMS implementation. The IMS strategies cover the possible ways and approaches for management systems integration. There are two ways of integrating the management systems which are consecutive implementation of management systems followed by integration and integrate the management systems simultaneously from the beginning. Several approaches that can be applied as a basis for integrating the management systems are include the standard approach, systems approach, Total Quality approach, and Plan-Do-Check-Act (PDCA) approach. Meanwhile, the critical success factors for IMS implementation can be categorized as management commitment and leadership, resources management, focus on stakeholders, education and training, performance measurement, systems and processes, and continual improvement. Keywords:Integrated Management Systems, Quality Management Systems, Environmental Management Systems, Occupational Health and Safety Management Systems

1. Introduction Today’s global markets require companies to implement Integrated Management Systems (IMS) to survive and stay competitive. Traditionally, management systems such as quality, environmental, and occupational health and safety are operated independently by different departments in organizations. The certification of the management systems standards such as ISO9000, QS9000 and ISO/TS16949 for Quality Management Systems (QMS), ISO14000 for Environmental Management Systems (EMS) and OHSAS18000 for Occupational Health and Safety Management Systems (OHSMS) which are conducted separately incur redundancies and high costs to organizations. By developing and implementing IMS that integrate the management systems, the companies are able to reduce paperwork, minimize costs, eliminate redundancy, and eventually improve system effectiveness and efficiency. This paper presents the strategies and critical success factors for IMS implementation consisting of QMS, EMS and/or OHSMS. Even though this paper discusses only on these three management systems, the scope of a ‘true’ IMS should encompasses of any management systems that affect the business results such as human resource (IIP), information security management (ISO/IEC 17799) and social accountability (SA8000) (Wilkinson & Dale, 1999). 1. Ways of integrating the management systems In general, there are two ways of integrating management systems which are consecutive implementation of management systems followed by integration and integrate the management systems simultaneously from the beginning. The first option has been practiced by companies that started with the implementation of a single or separate management system (e.g. QMS, EMS, or OHSMS) due to business pressure or for legal reasons. This option involved a sequential or one-by-one implementation of individual management system and followed by integration (Labodova, 2004). Most of the companies normally implemented QMS first and

35th International Conference on Computers and Industrial Engineering

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then continued by integrating it with other management systems (e.g. EMS or OHSMS). This is probably the most usual path due to a larger number of companies that have QMS registration compared to other systems (Karapetrovic, 2002). Companies usually establish QMS first and then continued with combining the EMS as close as possible to their QMS in structuring the integration of QMS and EMS (Karapetrovic, 2002; Labodova, 2004; Douglas & Glen, 2000; Bechmerhagen, Berg, Karapetrovic & Willborn, 2003). For companies under strong environmental regulations (e.g. oil company, electrical utility or a nuclear power plant) they might implement EMS first, and subsequently integrate other management systems (QMS or OHSMS) using the EMS model and/or requirements (Karapetrovic, 2002; Bechmerhagen et al., 2003). Whether companies integrate EMS with QMS or EMS with OHSMS depends on which systems are required by them. Since these companies have integrated two management systems, they might continue with integrating the third management system in order for them to have all three management systems (QMS, EMS and OHSMS) in place. The second option that can be implemented is by integrating the management systems simultaneously from the beginning. For the companies that do not have any formal management systems, they can integrate all three management systems (QMS, EMS and OHSMS) consecutively or they can also start by integrating two management systems first (e.g. QMS and EMS, or EMS and OHSMS) then followed by other management system. However, for companies those have already certified with one management system, they can simultaneously integrate two other management systems first and then integrate it with the existing management system (Labodova, 2004; Karapetrovic, 2002; Bechmerhagen et al., 2003). 2. Approaches towards integrating management systems From the literature, it was found that there are several approaches that can facilitate the integration of management systems such as standard approach, systems approach, Total Quality approach and Plan-DoCheck-Act (PDCA) approach. First approach is based on management systems standard. It can be easily achieved since ISO 14001 shares common management system principles with ISO 9000, and OHSAS 18001 is compatible with ISO 14001 and ISO 9000. This issue has been highlighted by most of the writers, such as Dubinski, Gruszka & Krodkiewska-Skoczylas (2003), McDonald, Mors & Philips (2003), Abarca (1998), Jorgensen & Simonsen (2002), Beckmerhagen et al. (2003), Beechner & Koch (1997), Wilkinson & Dale (1999), Karapetrovic (2002), and Karapetrovic & Willborn (1998). This approach can be divided as follows: • Integrate the management systems by using the ISO9000 requirements/model (Beckmerhagen et al., 2003; Karapetrovic & Willborn, 1998; Stamou, 2003; Scipioni, Arena, Villa & Saccarola, 2001; Von Ahsen & Funck, 2001) • Integrate the management systems by using the ISO14000 requirements/model (Beckmerhagen et al., 2003; Karapetrovic & Willborn, 1998; Von Ahsen & Funck, 2001) • Integrate the management systems by using the OHSMS standard requirements/methodology (Labodova, 2004) The second approach is by using systems concept. Karapetrovic (2002) stated that systems concept views a problem as a whole, rather than as separate parts. A system consists of interlinked processes that function harmoniously, share the same resources, and are all directed towards the achievement of a set goals or objectives. This concept provides a good foundation for simultaneous integration, starting from the determination of objectives and desired outputs, through system design, allocation of resources and system implementation, to the comparison of actual and desired outputs. It is also compatible with the ISO9001:2000, ISO14001 and OHSAS18001 (Jonker & Karapetrovic, 2004). The next approach utilizes Total Quality Management (TQM) concepts and/or quality award model such as Malcolm Baldrige National Quality Award (MBNQA) and European Quality Award (EQA). Wilkinson & Dale (2001) have developed an integrated organizational model for Quality, Environmental, Health and Safety Management Systems, using Total Quality approach which includes leadership and culture issues. Following the same approach, Chan, Gaffney, Neailey & Ip (1998) have developed an IMS for a railway engineering management using the basis of MBNQA criteria.

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Beckmerhagen et al. (2003) and Karapetrovic (2002) have proposed the following approach for management systems integration which is using Plan-Do-Check-Act (PDCA) cycle. Since ISO14000 (EMS) and BS8800 (OHSMS) are developed based on the PDCA cycle, therefore this approach is suitable to integrate these two management systems. At the same time, the new ISO9001 version 2000 and it process model are also compatible and can be combined together into the PDCA cycle. Alternatively, the companies can also combine several approaches to integrate their management systems. For example, Mackau (2003) stated that TQM confronts organizations and employees in many situations with excessive demands while the ISO9000 standard is underdeveloped. In order to balance it, Mackau (2003) has developed an IMS manual by combining both management system standard (ISO9000) and Total Quality approach. 4. Critical success factors for IMS implementation There are various factors that are currently being perceived to be critical for successful IMS implementation. Even though there are different views given by various authors, the factors are actually centered on seven main elements which are management commitment and leadership, resources management, focus on stakeholders, education and training, performance measurement, systems and processes, and continual improvement. Management commitment and leadership The need for management commitment and leadership is highlighted by most authors such as Jackson (1996), Beechner & Koch (1997), Scipioni et al. (2001), Mackau (2003), Zutshi & Sohal (2005), Abarca (1998), and Dubinski et al. (2003). Management should prepare an IMS policy statement and objectives. Then, it should be communicated and interpreted to all the employees in order for them to understand. Management should regularly conduct IMS planning and review the IMS performance. At the same time, they should provide the employees with sufficient resources (e.g. financial, physical and technical) in order for them to perform their work effectively. To ensure smooth implementation of IMS, the appointment of a coordinator or “champion” is also needed to administer all related activities in daily operations and translate what the management expectations so that the people at the lower levels of the organization can understand and able to carry-out their job effectively (Beechner & Koch, 1997; Zutshi & Sohal, 2005). Resources management Even though management commitment and leadership are critical, effective resources management is also vital for successful IMS implementation. It embraces human resources, information, infrastructure, and equipment. Employee involvement is needed in all functions and at all levels. Everyone in the organization is responsible and empowers to implement and maintain quality, environment, health and safety aspects (Beechner & Koch, 1997; Zutshi & Sohal, 2005). Employees input should be obtained when defining job responsibilities and IMS procedures (Jackson, 1996). At the same time, pertinent information on IMS should be collected, analyzed, managed and communicated properly to all staff in the organization (Scipioni et al., 2001). IMS will only work if everyone understands and uses them. Companies should also provide and maintain the infrastructure needed to achieve conformity to quality, environment, safety and health requirements. Concurrently, all the inspection and test equipment are calibrated and maintained to ensure that they are able to perform the inspection and test as required (Beechner & Koch, 1997). Focus on stakeholders The existence of the business is because of stakeholders. Therefore, each company needs to focus on stakeholders in order to sustain the business (Jackson, 1996; Yusof, 1999). The stakeholders include the internal customers, external customers, suppliers, subcontractors, local authorities, regulators, local community and society (Karapetrovic & Willborn, 2002). Each company should identify the customers’ needs by asking what they expect. At the same time, government and/or local authorities’ regulations relating to quality, environment, safety and health have to be identified. Each company also has to build, maintain and enhance its relationships with the stakeholders (Beechner & Koch, 1997). Moreover, every company should ensure that the suppliers are able to maintain high technical standards and meet quality, environment, safety and health specifications.


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Education and training Education and training are important to obtain management and employees’ involvement. Management and employees have to be trained to ensure that they are aware and understand how to implement IMS. Management should demonstrate that they are willing to learn and provide learning opportunities for all employees (Yusof, 1999; Zutshi & Sohal, 2005). Mackau (2003) stated that all employees should have wellfounded knowledge about internal company procedures and some of the employees are trained for interpretation of the management systems standard. At the same time, the company should regularly review the employee training plans to ensure it is relevant and sufficient for successful IMS implementation (Beechner & Koch, 1997). Performance measurement Performance measurement is the element where the companies are able to check how far they have achieved, measure performance and compared to their objectives, check adherence to legal and standards’ requirements, and plan for new improvement targets (Scipioni et al., 2001). Some of the activities that the companies can implement are involving the followings: • Develop performance standards or checklists and a schedule for monitoring the progress of each system and process (Holdsworth, 2003). • Measure performance of systems processes and products/services, and compared to the business objectives (Jackson, 1996). • Benchmark company performance (e.g. market share and profit) among the companies in the same line of trade (Mackau, 2003). • Carry-out internal and external IMS audits to identify non-conformances in the systems and processes (McDonald et al., 2003; Dubinski et al., 2003; Abarca, 1998; Zutshi & Sohal, 2005). Systems and processes Beechner & Koch (1997) stated that the documentation system is a fundamental requirement for IMS. The IMS documentation includes the IMS manual, procedures, documents, forms and records. All the IMS documentation should be readily available to the departments that use it, reviewed periodically for relevancy and disposed when it becomes obsolete. At the same time, product and process characteristics that can affect quality, environment, safety and health performance should be identified, monitored and improved. Similarly, corrective and prevention actions should also be identified and implemented. Continual improvement According to Dubinski, et al. (2003), continual improvement is the glue that links the systems, and as an important tool to meet quality, environmental, safety and health objectives consistent with IMS policy. It must be conducted to improve processes and systems within the same department (within function) and across each department (cross functional). The adoption of continual improvement is a springboard for behavioral change, but it can only be successful when all parts of organization are in the same culture mode and able to work together (Hoyle, 1996; Wilkinson & Dale, 1999; Zutshi & Sohal, 2005). Concurrently, it should also be viewed as a work culture and everyone in the organization should continuously seek better ways of doing their jobs (Yusof, 1999). 5. Conclusions This paper presented some key issues from literature regarding IMS implementation focusing on the integration of QMS, EMS and/or OHSMS. The strategies that have been elaborated cover the possible ways and approaches that can be applied when integrating the management systems. Depending on the size, types of industry, culture of the company and its available resources, the companies need to choose a suitable strategy to integrate their management systems. Subsequently, several factors that are critical for successful IMS implementation have been explained. By knowing these factors, the companies are able to strategize their plan and focus on a few areas that are crucial for IMS to flourish. It will also help the companies to implement IMS successfully in a shorter period of time without having a lot of hassle and resistance. Further research will focus on investigating the strategies for management systems integration and identifying the critical success factors for IMS implementation in the manufacturing companies. A questionnaire has been developed and validated by academicians and practitioners before being used in the survey. Subsequently, 1394


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