Context of the organization is a new requirement in ISO 9001:2015 standard. Context of the organization is the business environment determined by external factors like legal, financial, social, regulatory and cultural, etc. and organization’s internal environment determined by internal factors like internal structures, governance, resource capabilities. Context of the organization also depends on the requirements of the Interested Parties.
Both internal and external context can influence strategic plans of an organization. Business environments is change quickly. Organizations who captures these changing business needs quickly are more able to survive in a highly competitive environment. In today’s business environment, a single customer compliant on a social media platform can spoil a company’s reputation. Customer pressures can force organizations to change various policies on product returns, customer support and much more. Similarly, internal context like organizational structures or skills of employees can result in procedural changes within organizations. When developing a Quality Management system, it is important organizations understand these contexts when determining the scope of the Quality Management System.
Capturing Internal and External Issues
Internal Issues relate to the internal environment in which the organization operates. This will determine your company’s approach towards governance and its relationship with various stakeholders. Internal issues need to be understood in terms of:
- Products or service offered
- Organizational structures, roles and responsibilities and governance
- Regulatory requirements
- Objectives, policies and strategies
- Resource capabilities and knowledge
- Standards or models adopted by the organization
External Issues include social, technological, ethical, legal, political, and economic environment in which the organization operates. External context need to be understood in terms of:
- The social and cultural issues
- Legal and regulatory requirements
- Technological or economic scenario
- Natural and competitive environment, be it international, national, regional or local
- Key market drivers and trends
- Relationships with external stakeholders
While determining the Context of an organization, various methods like SWOT (strengths, weaknesses, opportunities and threats), PEST (political, economic, social and technological) analysis may be used. Brainstorming needs to be done with Management to determine context of the organization. Issues may be captured using an issue log and actions may be planned against each issue to adequately address them. These should determine the strategic direction of the organization and scope of the Quality Management System.
Capturing Requirements of Interested Parties
Relevant Interested Parties in a business scenario are all stakeholders, internal or external, who impact or could potentially impact an organization’s capability to supply products and services, which meet customer and legal requirements, consistently. Once all stakeholders have been identified, you need to understand their requirements and address them adequately. A customer requirement could be to produce quality deliveries on time or provide value for money. Management may be looking for good financial performance and Government Agencies may have statutory and regulatory requirements which organization need to address. An organization needs to identify all such requirements and plan strategies to address them.
Monitor and review the context
Once the context, issues and Interested Parties are determined, mechanisms should be built in the organization to monitor and review these requirements on regular intervals. This can be done through Management reviews. Context and requirement of interested parties may change with time, which is why it is important to keep these up-to-date with the market trends and changing internal environment of the organization.
Define the scope of QMS based on the context
Scope of the Quality Management System should be defined based on
- The external and internal issues determined
- The requirements of relevant interested parties
- Products and services of the organization
The scope of Quality Management System should clearly indicate nature of product / service being offered, context in which the organization operates and shall address requirements of all interested parties.
To the novice quality manager, ISO jargon can be extremely overwhelming. What is an NCR? What do you mean by OFI? Are we certified or accredited? But before you go and pull out your hair, let’s take a moment to go over some of the most frequently used terms and their definitions with regards to ISO and Management System Certification.