Tuesday, August 17, 2010

ISO 14001 – Application to Small and Medium Size Enterprises

ISO 14001 – Application to Small and Medium Size Enterprises

Most of the development and application of EMS has taken place in large companies. The use of such systems in small and medium-size enterprises (SMEs) has been limited—although it is in this segment of industry that some of the largest benefits might be anticipated, because of the difficulty of regulating large numbers of small firms and the potential efficiency improvements that are believed to exist. In practice, however, the characteristics of the typical SME make the adoption of EMS difficult: most SMEs do not have a formal management structure, they lack technically trained personnel, and they are subject to severe short-term pressures on cash flow.

Anecdotal evidence indicates that an EMS cannot be used to drive improved performance in a poorly organized SME. Targeted training in management and quality control can improve overall performance, including its environmental aspects, and can provide a basis for more specific EMS development. Many firms can reap significant benefits from introducing quality management concepts, even where they are not aiming at formal certification. Any steps in this direction should be encouraged.

An EMS, as normally envisaged, builds on existing production and quality management systems. Where such systems are weak or ineffective, as is often the case in enterprises that have poor environmental performance, a better management framework has to be established before focusing on the details of the EMS. The costs of establishing an EMS will therefore obviously depend on the starting point in terms of both management systems and environmental performance.

The ecoefficiency savings can, in some cases, pay for the costs of establishing the EMS, particularly if most of the planning and organizational work is carried out in-house. However, a poor performer will very likely have to invest in production upgrading or pollution control in order to meet environmental requirements, and these costs can be significant.

A full EMS can be complex and can require an appreciable commitment of operational resources.

However, the final system can be reached reasonably through a series of discrete steps, starting from a basic, simple procedure and becoming more comprehensive and sophisticated as capabilities and resources allow. In this way, even a small enterprise can begin to put in place the basic elements of an ISO 14001 system and can develop them at an appropriate pace. Once the basic EMS is in place, it is possible to carry out a gap analysis and to make a balanced judgment on the costs and benefits of seeking certification.

A related issue is the coverage of the EMS. Certification is normally for specific sites or facilities.

A large enterprise may have a number of different sites and production facilities and may choose to seek certification only for a subset of the sites.

Role of Governments In ISO 14001 Standards

Role of Governments In ISO 14001 Standards

Although ISO 14000 is a set of voluntary standards that individual companies may or may not choose to adopt, governments can clearly have a role in providing information, establishing the necessary framework and infrastructure, and, in some cases, helping companies to develop the basic capabilities to adopt ISO 14000. There are two particular areas in which government action would be useful: (a) providing information on the sectors and markets where ISO 14001 certification is a significant issue and assisting sector organizations to develop appropriate responses, and (b) helping to establish a certification framework, based on strengthening national standards organizations and encouraging competitive private sector provision of auditing and certification services. At present, the World Bank is having discussions with a number of countries about how assistance could be provided with these issues.

Governments should see EMS approaches as part of a broad environmental strategy that includes regulatory systems, appropriate financial incentives, and encouragement of improved industrial performance. Such encouragement can really only be effective where there is cooperation at the government level between the relevant departments, including industry and trade, as well as environment. There is a growing interest in integrating environmental management issues into productivity or competitiveness centers designed to promote SME performance, but little information exists on experience to date.

The characteristics of quality Classification of products and services

If we group products and services (entities) by type, category, class and grade
we can use the subdivision to make comparisons on an equitable basis. But
when we compare entities we must be careful not to claim one is of better
quality than the other unless they are of the same grade. Entities of the same
type have at least one attribute in common. Entities of the same grade have
been designed for the same functional use and therefore comparisons are valid.
Comparisons on quality between entities of different grades, classes, categories
or types are invalid because they have been designed for a different use or
purpose.
Let us look at some examples to illustrate the point. Food is a type of entity.
Transport is another entity. Putting aside the fact that in the food industry the
terms class and grade are used to denote the condition of post-production
product, comparisons between types is like comparing fruit and trucks – there
are no common attributes. Comparisons between categories are like comparing
fruit and vegetables. Comparisons between classes are like comparing apples
and oranges. Comparisons between grades is like comparing eating apples and
cooking apples.
Now let us take another example. Transport is a type of entity. There are
different categories of transport such as airliners, ships, automobiles and trains;
they are all modes of transport but each has many different attributes.
Differences between categories of transport are therefore differences in modes of
transport. Within each category there are differences in class. For manufactured
products, differences between classes imply differences in purpose. Luxury cars,
large family cars, small family cars, vans, trucks, four-wheel drive vehicles etc.
fall within the same category of transport but each was designed for a different
purpose. Family cars are in a different class to luxury cars; they were not
designed for the same purpose. It is therefore inappropriate to compare a
Cadillac with a Chevrolet or a Rolls Royce Silver Shadow with a Ford Mondeo.
Entities designed for the same purpose but having different specifications are
of different grades. A Ford Mondeo GTX is a different grade to a Mondeo LX.
They were both designed for the same purpose but differ in their performance
and features.
Now let us take an example from the service industry: accommodation. There
are various categories, such as rented, leased and purchased. In the rented
category there are hotels, inns, guesthouses, apartments etc. It would be inappropriate
to compare hotels with guesthouses or apartments with inns. They are
each in a different class. Hotels are a class of accommodation within which are
grades such as 5 star, 4 star, 3 star etc., indicating the facilities offered.
You can legitimately compare the quality of entities if comparing entities of
the same grade. If a low-grade service meets the needs for which it was
designed, it is of the requisite quality. If a high-grade product or service fails to
meet the requirements for which it was designed, it is of poor quality,
regardless of it still meeting the requirements for the lower grade. There is a
market for such differences in products and services but should customer
expectations change then what was once acceptable for a particular grade may
no longer be acceptable and regrading may have to occur.
Where manufacturing processes are prone to uncontrollable variation it is
not uncommon to grade products as a method of selection. The product that is
free of imperfections would be the highest grade and would therefore
command the highest price. Any product with imperfections would be
downgraded and sold at a correspondingly lower price. Examples of such
practice arise in the fruit and vegetables trade and the ceramics, glass and
textile industries. In the electronic component industry, grading is a common
practice to select devices that operate between certain temperature ranges. In
ideal conditions all devices would meet the higher specification but due to
manufacturing variation only a few may actually reach full performance. The
remainder of the devices has a degraded performance but still offer all the
functions of the top-grade component at lower temperatures. To say that these
differences are not differences in quality would be misleading, because the
products were all designed to fulfil the higher specification. As there is a
market for such products it is expedient to exploit it. There is a range over
which product quality can vary and still create satisfied customers. Outside the
lower end of this range the product is considered to be of poor quality.
If we group products and services (entities) by type, category, class and grade
we can use the subdivision to make comparisons on an equitable basis. But
when we compare entities we must be careful not to claim one is of better
quality than the other unless they are of the same grade. Entities of the same
type have at least one attribute in common. Entities of the same grade have
been designed for the same functional use and therefore comparisons are valid.
Comparisons on quality between entities of different grades, classes, categories
or types are invalid because they have been designed for a different use or
purpose.
Let us look at some examples to illustrate the point. Food is a type of entity.
Transport is another entity. Putting aside the fact that in the food industry the
terms class and grade are used to denote the condition of post-production
product, comparisons between types is like comparing fruit and trucks – there
are no common attributes. Comparisons between categories are like comparing
fruit and vegetables. Comparisons between classes are like comparing apples
and oranges. Comparisons between grades is like comparing eating apples and
cooking apples.
Now let us take another example. Transport is a type of entity. There are
different categories of transport such as airliners, ships, automobiles and trains;
they are all modes of transport but each has many different attributes.
Differences between categories of transport are therefore differences in modes of
transport. Within each category there are differences in class. For manufactured
products, differences between classes imply differences in purpose. Luxury cars,
large family cars, small family cars, vans, trucks, four-wheel drive vehicles etc.
fall within the same category of transport but each was designed for a different
purpose. Family cars are in a different class to luxury cars; they were not
designed for the same purpose. It is therefore inappropriate to compare a
Cadillac with a Chevrolet or a Rolls Royce Silver Shadow with a Ford Mondeo.
Entities designed for the same purpose but having different specifications are
of different grades. A Ford Mondeo GTX is a different grade to a Mondeo LX.
They were both designed for the same purpose but differ in their performance
and features.
Now let us take an example from the service industry: accommodation. There
are various categories, such as rented, leased and purchased. In the rented
category there are hotels, inns, guesthouses, apartments etc. It would be inappropriate
to compare hotels with guesthouses or apartments with inns. They are
each in a different class. Hotels are a class of accommodation within which are
grades such as 5 star, 4 star, 3 star etc., indicating the facilities offered.
You can legitimately compare the quality of entities if comparing entities of
the same grade. If a low-grade service meets the needs for which it was
designed, it is of the requisite quality. If a high-grade product or service fails to
meet the requirements for which it was designed, it is of poor quality,
regardless of it still meeting the requirements for the lower grade. There is a
market for such differences in products and services but should customer
expectations change then what was once acceptable for a particular grade may
no longer be acceptable and regrading may have to occur.
Where manufacturing processes are prone to uncontrollable variation it is
not uncommon to grade products as a method of selection. The product that is
free of imperfections would be the highest grade and would therefore
command the highest price. Any product with imperfections would be
downgraded and sold at a correspondingly lower price. Examples of such
practice arise in the fruit and vegetables trade and the ceramics, glass and
textile industries. In the electronic component industry, grading is a common
practice to select devices that operate between certain temperature ranges. In
ideal conditions all devices would meet the higher specification but due to
manufacturing variation only a few may actually reach full performance. The
remainder of the devices has a degraded performance but still offer all the
functions of the top-grade component at lower temperatures. To say that these
differences are not differences in quality would be misleading, because the
products were all designed to fulfil the higher specification. As there is a
market for such products it is expedient to exploit it. There is a range over
which product quality can vary and still create satisfied customers. Outside the
lower end of this range the product is considered to be of poor quality.

Documentation Structure For ISO 14001 EMS

ISO 14001 Standard does not require an Environmental Manual. Despite this, almost all companies I worked with developed and used EMS Manuals. Many of our clients use a four-level structures, including records, as shown below:
Manual – level 1
Procedures – level 2
Instructions – level 3
EMS Records – level 4
While auditing EMS systems like the one above, I often asked clients about the position of their Environmental policy in this structure. If you start from an Environmental Manual, how would you know what standard this manual should cover? The Environmental policy defines it and therefore it may be included into the structure:
Policy – level 1
EMS Manual – level 2
ISO 14001 Procedures – level 3
Work Instructions – level 4
EMS Records – level 5

The Needs Of ISO 14001 Standards

With the growing concerns of global warming, many industries are taking recourse to corrective measures so as to reduce the carbon emissions and abide by the government policies that lay stress on quality control measures so as to reduce the harmful gases in the atmosphere. Apart from following government policies, industries try to introduce various measures so as to reduce the pollution and minimize the risk it involves to the lives of workers and consumers.
To avail the highest quality standards, one has to get the ISO 14001:2004 certification from the International Organization for Standardization. It is an international governing body that lays specific standards for quality controls. Given the fact that environment pollution is the biggest menace that can affect the progress of any organization, to avail the best quality standards one has to get the ISO 14001:2004 certification so as to provide clean and safe environment that is not affected from industrial works.
All those who get the ISO 14001:2004 certificate make sure that their industrial practices do not interfere in the environment by emanating any harmful substance in the atmosphere that can lead to hazard.
ISO 14001:2004 is universally known as Environmental Management System (EMS) that is based on specific environmental aspects and policies that are implemented. Basically, ISO 14001:2004 is not based on finished product as it lays emphasis on the procedures that are adopted in the manufacturing and production of the product. According to ISO, ISO 14001:2004 certificates are provided to those industries and organizations that try to reduce pollution.
Those who avail ISO 14001:2004-certificate benefit from reduction of cost from waste management, saving fuel and energy while lowering the cost of distribution. This leads to improved industrial and corporate image amongst customers, regulators and public. ISO 14001:2004 strives for consistent quality control that helps in providing the best industrial support to an organization by helping in the reduction of global warming and pollution.
For all those organizations that are looking forward to reduce pollution, ISO 14001:2004 is a practical tool that helps an industry in managing its energy consumption along with finding an alternative way so as to enhance the productivity along with reducing pollution levels.
In case an industrial unit is not following ISO 14001:2004 guidelines, it will not be able to avail ISO 14001:2004 certification that provides it quality control features. Apart from ISO 14001:2004, ISO offers numerous other certificates that deal with specific standards such as specification for shipping containers, IT software and languages, Iron Ores, country codes, safety labels, graphics, Standard Generalized Markup Languages and numerous other features that make it a useful guideline.
So, in case one is planning to set up an industrial unit or is an existing owner, it is essential to have quality control measures based on ISO 14001:2004. This certificate provides Environmental Management System. An ISO 14001:2004 certificate will help you in reducing the cost of manufacturing and energy consumption. Manage your business solutions with ISO 14001:2004 guidelines and reap benefits of Environmental Management System.