Is ISO9000 killing your business?
By Roger La Salle
Innovate or Perish?
I am not sure how many times I have related the statistic that whereas in the 1920’s the life expectancy of a public company in the USA was some 65 years, by the 1990’s this had fallen to ten years and today is even less.
There is a clear message there of the need for innovation and to be constantly moving your products, services and customers to an ever better place. In short, Innovate or Perish!
Is ISO 9000 the answer?
Many companies have embraced the teachings of the ISO regime and indeed many suppliers demand that their subcontractors be accredited to this standard as there is little doubt there are benefits to be had, at least in the short term.
The system and order delivered by the dictates of ISO certainly improves traceability and documentation and establishes systems and order into what may have formerly been a somewhat chaotic organisation. That’s the good news.
So what’s the catch?
A study done by Mike Tushman of Harvard Business School and Mary Benner of the Warton school showed that the adoption of ISO9000 comes with a “sting in the tail”.
In the years immediately following ISO implementation business outcomes improved in terms of reduced defect, less waste and rework, improved quality and more repeatability in terms of all processes. Customers, especially the bigger ones, loved this and were eager to see all of their suppliers embrace ISO 9000.
Of course in the wake of this many others followed suit, or in some cases were pushed into accreditation by their upper tier customers. However, after several year of working with the system and order dictated by ISO, the innovation of these accredited companies collapsed.
No longer was there so much free thinking and an ability to step outside the boundary dictates of ISO.
The result the study revealed was that within five to seven years at the most, innovation output plummeted, these companies became slaves to the ISO regime and stagnated.
What’s the message?
ISO9000 accreditation may be necessary, especially if you are a supplier to the majors, but beware its downside.
The more system and rigour you bring into your organisation, the greater the need to implement innovation circles as a cultural part of your DNA.
Observe what is happening to your business as staff work to ISO. Observe too the possible downward spiral of innovation output. If you see that happening and you are a slave to the upper tier suppliers, as most of the auto industry providers are, or were, you may well be “ISOing” yourself into extinction.
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Roger La Salle, is the creator of the “Matrix Thinking”™ technique and is widely sought after as an international speaker on Innovation, Opportunity and business development. He is the author of four books, Director and former CEO of the Innovation Centre of Victoria (INNOVIC) as well as a number of companies both in Australian and overseas. He has been responsible for a number of successful technology start-ups and in 2004 was a regular panelist on the ABC New Inventors TV program. In 2005 he was appointed to the “Chair of Innovation” at “The Queens University” in Belfast. Matrix Thinking is now used in more than 26 countries and licensed to Deloitte, one of the world’s largest consulting firms. www.matrixthinking.com
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