This post was originally published on the IQS website, and can be found here.
Quality management software and risk management software have several aspects in common. However, within your company, quality and risk managers may not be collaborating in a meaningful, value-added way. These two fields are distinct disciplines, but if your organization can integrate risk management concepts into a modern quality management system, synergies may begin to come together in unforeseen ways. Finding common ground between quality management and risk management in today’s global manufacturing industry will help overall quality.
Defining Risk Management and Quality Management
Are These Disciplines Two Sides of the Same Coin?
Research on the topic of using a risk management methodology in a quality management system sheds light on where similarities exist between these two disciplines. In one manner of speaking, risk management and quality management are two sides of the same coin. How they can work together is a separate question entirely and one that demands your immediate attention moving forward in 2014.
Quality management focuses on adhering to manufacturing requirements, international standards such as ISO 9001, and different government regulations – domestically and abroad. Risk management, on the other hand, focuses on the effects of uncertainty as well as the probability and consequences of potentially adverse events from a company-wide point of view. Despite their differences, however, risk management and quality management share common ground in a few areas.
Common Ground Between Quality and Risk Management
From a high level, both disciplines rely on cause-and-effect analysis techniques to decide which corrective and preventative actions are the best choice. Both risk management and quality management strategies must find ways to account for uncertainty. After all, in the quality management space there is no such thing as an absolutely perfect quality product. Handling risk is implicit in the day-to-day tasks of a successful quality management professional.
The poor quality of one product or part can have a seriously negative impact on the quality of another – thus increasing the severity and potential impact of unforeseen problems. Given the increasingly competitive nature of the manufacturing industry today, you should understand that risk management touches every level of your quality management system on a daily basis. Rightly so, as creating synergies between risk management and your discipline may give your company a competitive advantage over the long term.
Integrating Risk Management into Quality Management Creates Synergies
As a quick example of how risk management and quality management complement one another, consider the challenges of managing a large, multi-tiered supplier base. Meeting compliance mandates domestically and abroad poses a never-ending series of challenges for your organization, which is why having a sound quality management system is so critical today. Depending on your company’s industry segment and position in the global value chain, suppliers may play a business-critical role.
Including risk management in a modern quality management system gives you a means to further vet suppliers in a systematic way. Generally speaking from a high level, risk management encompasses:
- Establishing context (i.e., supplier quality)
- Identifying and assessing risks
- Taking action to lower risks systematically
Managing the quality of a globally disperse network of suppliers would not be possible without company-wide risk management strategies included in a quality management system. Consider the trend of increasing the role of suppliers in daily quality management processes.
As the quality of one supplier’s products or parts decreases over time, so does risk rise. Taken a step further, without a systematic, integrated way to monitor quality in tandem with risk management, the validity of a supplier’s capabilities comes into question.
When Risk and Quality Management Work Well Together
In several ways, risk management and quality management already integrate to a certain extent. As one example, consider the use of failure modes and effects analysis used by automotive manufacturers today. Also, Six Sigma techniques for reducing quality defects imply the lowering of risk by reducing deviations.
Unfortunately, risk management and quality management do not speak the same language on a day-to-day basis despite having so much in common from a company-wide point of view. To bring risk management into the quality management fold, your task is to challenge the culture within your company to find creative ways to infuse risk management into quality management processes – and vice versa.
Today, quality is key to staying competitive and is strengthened by adding risk management to the equation. As such, it is absolutely critical that you work with your company’s risk management professionals to fine tune an updated quality management system.
Quality management and risk management share more common ground than you might initially believe. By taking an integrated and holistic approach to quality and risk, your company can achieve synergies that in an ideal situation would lower total cost of quality alongside reducing risk and increasing quality overall.
About the Author
Michael Rapaport is the President of IQS, Inc. in Cleveland OH. Michael is responsible for enabling operational excellence across the company as well as building capabilities for IQS’s growth. Corporate vision, strategic planning, and innovation are the cornerstone to Michael's 30 years of leadership in the technology industry. He is passionate about data visibility and continuous improvement and believes in helping manufacturers save time and money with real technology solutions.More Content by Michael Rapaport