ISO vs Lean: What delivers customer satisfaction?

Many manufacturing organizations are often faced with this dilemma. Should they start working towards ISO 9001 certification? Or should they start applying Lean principles (also known as The Toyota Production System (TPS) or Kaizen) in order to deliver customer satisfaction?

You may be surprised to know that not only are these two initiatives are complimentary, but an organization that has started applying Lean will finding applying for ISO certification a much smoother experience.

Overview of ISO

The ISO standard was created in 1947 to provide a recognized and unified reference to produce safe, reliable and good quality products across multiple countries and regions. Over the seventy years that ISO has been in existence, it has generated over 22,606 international standards across multiple industries, with members from 164 countries.

Created in 1987, the ISO 9000 standard family is currently the widest used ISO standard and is used to determine the Quality Management System of a company. This standard is continually assessed by a technical committee of subject matter experts and developed via consensus. The standard is broad enough to be used by an enterprise or organization that delivers a product or service to a customer.

Many businesses will attain ISO certification as perquisite to attract certain markets (e.g. exports) and customers. The certification provides the customer the peace of mind that the products they buy will meet an international standard of quality.

Overview of Lean

Since the dawn of the industrial age, man has been working on improving the method of production. Briefly, this timeline includes:

  • Fredrick Taylor – 1900s – Experiments to improve efficiency. This was done my breaking down process tasks into smaller sub tasks with minimal variation. This standardization of work led to improved productivity.
  • Henry Ford – 1910s – Installs the moving assembly line in 1913 at his Baton Rouge industrial complex to enable the continuous flow of production.
  • Edward Deming – 1930s – Deming recognized that the key to improved quality was in understanding the nature of variation. This led to the development of TQM (Total Quality management) methodology which incorporates 14 principles which espouse, among others build quality into the product, improve constantly, break down barriers between departments.
  • Taichi Ohno – 1950s – Development of the Toyota Production System (TPS) at the Toyota Motor corporations. TPS incorporates many of the principles described above but add focus on delivering value to the customer by “smoothening” the flow of production. This includes but is not limited to the removal of waste and recognizing and developing the skills of the employees in removing unevenness. TPS enabled Toyota to become the worlds largest manufacturer while building cars with legendary reliability.
  • James Womack, Daniels T Jones – 1980s – Based on their work observing Toyota as part of an MIT study, Womack and Jones wrote the book The Machine That Changed The World which introduced the Toyota Production System to the rest of the world. They coined the term Lean Production.

Enterprises who embark on a Lean Transformation Journey often so based on business conditions pressures (poor customer satisfaction, increased competition, increased costs of doing business). They use Lean Principles to:

  • Understand the value they deliver to their customers
  • Standardize the processes which deliver this value,
  • Use lean tools to remove the waste from these processes and hence maximize the delivery of the value of the
  • Develop a culture of continuous improvement by empowering all the stakeholders to implement lean.

The lean principles allow the business to deliver maximum value at ever reducing costs.

ISO vs. Lean Comparison

In summary, ISO provides a standard of all the procedures and systems that the business should have in place to deliver a product with consistent quality. As this standard is internationally accepted, it enables customer to know that the same product built on two different continents at ISO certified companies will perform similarly.

In my experience, the main pitfall with the implementation of the ISO standard (and something that the newer ISO standards are tying to address) is that many businesses approach ISO certification as a checklist exercise to improve their processes. ISO tells a business what they should have in place but doesn’t provide the skill on how they should implement. I have seen many businesses with ISO certification, yet many of the same operational problems remain.

Lean transformation, on the other hand, changes the way the organisation approaches its business. By focusing on maximising the delivery of value to the customer, by the removal of waste in all processes and empowering employees, the organisation at large becomes completely focused on delivering customer satisfaction. Unlike applying for ISO certification, Lean transformation does not have a date upon which Lean is achieved and all preparations stop. It is a journey.

Which should you implement first?

Businesses that start the lean transformation journey first, will have a strong foundation for an easier and faster ISO certification process. Using lean tools such as process mapping, value stream mapping, problem solving among others, the business will have developed the capability to deliver value competitively in a method that closely aligns with the ISO Quality Management Standard.

In summary, while Lean and ISO complement each other, Lean provides the foundation for an effortless ISO certification process.