ISO 9001 and ERP: A united approach

Work process documentation is a good starting point for both certification and software selection

Pursuing ISO 9001 certification or implementing enterprise resource planning (ERP) software can give pause to even the most aggressive and visionary manufacturing leader.

When these projects go reasonably well, those who have gone there will attest to the immense cost and time of each undertaking, sometimes measured in years. At worst, most know of or have personally experienced cases where these projects have failed, suffering cost overruns, interminable delays, or unfulfilled expectations.

Often manufacturers postpone ISO 9001 certification and ERP implementation indefinitely because of their magnitude when considered alongside the daily job of running the business. Yet ISO 9001 and ERP software are increasingly necessary in light of advancing technology, firmer audit requirements from customers, and stiffer price competition.

What to do? Why not do both? Since implementing ERP software and achieving ISO 9001 certification are both centered around process documentation and system thinking, they should be evaluated, planned, and potentially executed in single or highly connected workstreams, making them more manageable, cost-effective, and successful on the whole.

Medina, Ohio-based United Tube Corp., a manufacturer of welded steel tubing, could be considered a poster child for successful ISO 9001 and ERP implementation. Reading the following examples from United Tube’s experience may help metal fabricators find some useful suggestions for achieving ISO 9001 and ERP.

Swallowing the Elephant

While situations vary by manufacturer, mutually considered ISO 9001 and ERP can be broken down into four primary sequential activities, with a supporting fifth activity (see Figure 1).

While United Tube did not tackle ISO 9001 and ERP simultaneously, it did follow this sequence over a period of time, using the outputs of its ERP project to facilitate ISO later. In 2008 then CFO Frank Sadowski knew that having modern ERP software was necessary for the future of the business. United Tube had the foresight to immediately conduct a system discovery with its third-party software consultant, equipping the company with workflows and software requirements that would prove highly useful not only to manage its ERP implementation, but later with ISO.

1. System process discovery. Kick off the overall initiative with discovery, in which current and future desired process workflows and software touch points are documented and agreed upon internally. A software partner or third-party process consultant can be helpful here.

2. ERP software selection. Evaluate ERP software that demonstrates the ability to execute the future process workflows easily, with a nimbleness to adjust to change. The importance of the vendor's willingness, technical ability, and track record in accommodating future change cannot be understated.

3. ERP implementation. Conduct the ERP software technical implementation, staying true to the processes as documented or adjusting as more is learned during testing and training.

4. ISO certification. Follow the ERP implementation closely with ISO certification, while the new business processes are still fresh.

5. ISO 9001 touch points. Involve the ISO auditor at key intervals throughout the entire program to gain helpful third-party insights and best practices and to be on the same page in advance of the scheduled ISO certification.

In 2013 United Tube pursued ISO 9001 certification and completed the process in August of that year. According to Sadowski, who has since become president and owner of United Tube, the ISO 9001 certification process went smoothly because they were able to hand over process mappings and charts from the ERP discovery to the ISO consultant, saving countless weeks that might have been needed to pull that information together.

Business Case

Why should a company approach ISO 9001 and ERP as suggested? There are many reasons, best summarized into three supporting cases:

- Time savings. Combining system process mapping into a single discovery activity yields a 25 to 50 per cent time savings in the ISO certification process. The ISO consultant that assisted United Tube with its ISO certification estimated that the company’s ERP discovery and implementation helped to eliminate at least six months from the process needed to certify United Tube’s quality management system that met the ISO 9001 standard.

- Employee ownership. Involving a core team in the mapping of processes, selection of software, and ISO certification fosters employee ownership in, enthusiasm for, and accountability for the entire effort, both from technology and process perspectives. Cleveland-based metal stamper Die-Matic Corp. implemented ERP software that took into account the TS 16949 quality requirements. The stamper involved all levels of employees in the development process, and securing their buy-in allowed management to hold them accountable, which had a positive effect on the bottom line, said Jerry Zeitler, Die-Matic’s president.

- Natural order of things. In the end, we all know that navigating major projects takes some common sense. Who would lay out a production facility without understanding how material should flow through the plant? Who would construct a freeway system without a clear, detailed knowledge of traffic patterns? Similarly, before choosing and implementing the software platform on which it will operate, a company should first document its future information flows with confidence. This principle is central to both ISO 9001 certification and properly managed ERP.

Lasting Results

The ultimate measure of a manufacturing project's success is return on investment (ROI). United Tube clearly recognized a quick ROI from its synchronized and thoughtfully managed ERP and ISO 9001 ventures. Speaking in terms of overlapping benefits that touch both, United Tube listed six specific tangible results:

1. Document control. Key documents, including quotes, confirmations, work orders, shipping documents, and invoices, are automatically generated and archived from one place in the software. Prior to the ERP implementation, data was entered into multiple places, and sometimes the same process was performed differently by different employees, according to Sadowski.

2. Equipment maintenance. The recording of equipment maintenance is a key tenet of ISO and is sometimes an afterthought and source of angst on ISO certifications. United Tube’s ERP plant floor preventive maintenance module now drives the maintenance schedule and automatically documents the process, said David Collins, United Tube’s plant manager.

3. Raw material traceability. United Tube connects labelled raw material to production shop orders and shipments using ERP bar code features on the plant floor. The company can easily show material traceability at the coil level in the ERP to auditors or customers without needing any additional paperwork.

4. Data analysis. Whether for ISO continuous improvement purposes or simply to better manage business, United Tube has timely access to many levels of historical data. It is now well-tooled to track its key metrics, including material utilization, scrap, and customer trends.

5. Paperless record retention. United Tube realized that most of its operational data was captured in its ERP and sought to store critical documents at key points in an electronic archive, eliminating the need for physical job folders.

6. Future agility. External requirements and related United Tube business processes undoubtedly would change down the road. Sadowski said that with the company’s ERP now well-coupled with business processes, it can easily adjust the software for an ISO-required form or other required business process change.

Taking the Necessary Steps

No sane manufacturing leader will claim that ISO 9001 certification or ERP software implementation is straightforward or easy. But the fact is that well-implemented ERP software and ISO certification have become increasingly required for many metal fabricators.

United Tube’s and other’s experiences demonstrate that companies can accomplish their desired objectives and even thrive as a result of ERP and ISO 9001 initiatives, when done thoughtfully and properly.

Mike Sweet is owner, Fidelis Partners Inc., 216-401-7244, www.fidelis-partners.com.

Steve Pettyjohn is president, Quality Assist Consulting, sapettyjohn@gmail.com.