Bsi bip 2002 2003

I should be rea d in c nju ction with IMS: Implement in a d Oper at in and other publcations in the series dealing w ith spec ific management sy stems.These bo ks present a fr amew ork –

Cr eatin g a Man u al

The Integr ated Mana ement Sy stems ( MS) ser ies of bo ks pr ov id es

practi cal gu i d an ce an d ad vi ce on i n t egr ati n g th e syst em s operat i n g w i t hi n an

organ i zati on The IMS ser i es provi d es a fr am ework i n t o whi ch ad d i t i on al

m an agem en t system s can be i n corpor ated

Each v olume is wr it en b an ac k now led ed ex pert in the field The series

ed itor is Dav id Smith of IMS R isk Solutions Ltd, w ho has be n inv olv ed in

w riting mana ement sy stem standar ds sinc e the early 19 0s and is himself

the author of a n mber of BSI bo ks on the subje t

IMS: The Fr amewor k

IMS: Implement ing a d Oper at in

IMS: Cust omer Sat isfact ion

IMS: Cr eat in a Ma u l

IMS: Infr mat ion Se ur it y

IMS: Ma a in Fo d Safet y

IMS: Risk Ma a ement f r Go d Go er na c

IMS: The Exc lenc Model

IMS: Audit a d Review

IMS: Huma Re our ce

IMS:

Fir t publshed 2 0

©IMSR isk Solutions Ltd 2 0

ISBN 0 5 0 4 1 6 3

BSI r fr nc : BIP 2 0

The right ofIMS R isk Solutions Ltd to be id entified as the author of this

w ork has be n ass rted in ac cord anc w ith the Co y right, De igns and

Patents Act 19 8

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per mis ion fr om BSI If per mis ion is gr ant ed , th e ter ms ma in c lud e

r oy alty p y ments or a lc ensing a r eement Detais and ad vic e c an be

o tained fr om the Co y r igh t Mana e, Br itish Stand ar d s Institution,

3 9 Chisw ic k High Ro d , Lon d on W4 4AL

Gr at care has be n tak en to ensur accuracy in the compiation and

pr paration of this publcation How ev er,sinc e it is intend ed as a guide

and not a deinitiv e statement, the author and BSI cannot in any

circ umstanc es ac cept r sp nsibi ty for the r sults ofany action taken

on the basis ofthe information contained in the publcation nor for any

e ror or omis ions This d e not affc t y our statutory rights

1 In tr od u ction 1

Appen d ix 1 IMS fr amewor k 5

Appen d ix 2 Me tin g the r eq u ir emen ts of spe ific

This bo k presents an a proac h to producing a sy stems manual for a

busines that has, or plans to hav e, an integrated management sy stem

Th e t erm ‘busi n es ’ i s u sed her e to d esc ri be an y organ i zati on I d oes n ot

i m pl y th at i t i s a com m erc i al or gan i zati on , bu t r efer s eq u al l y t o a gover n m en t

d ep r t men t o a n ot -for -pr ofi t or gan i zat i on , a hospi tal o a pol i c e for ce

About this book

This bo k prov ides guidanc e on preparing a man al fo an integrated

management sy stem After c v ering the prep ratory work, the bo k then

prov ides a sample manual The bo k do s not at empt to be a man al for

the implementation of any spec ific sy stem or disc iplne Other bo ks in this

ser ies giv e guid nc on me ting the r eq uirements of a partic ular stand rd

or disc iplne as part of an integrated sy stem

This bo k d oes not claim to be a hand o k fo the integration of ex isting

ma na gement systems I should be rea d in c nju ction with IMS:

Implement in a d Oper at in and other publcations in the series dealing

w ith spec ific management sy stems.These bo ks present a fr amew ork – the

integrated mana ement sy stems ( MS) fr amew ork – that giv es a model for

enc omp s ing all the c mmon elements of the d iferent mana ement

sy stems This f amew ork w as b sed on ISO G uide 7 , whic h proposed a

for mat that all future management standard s should folow

Th i s fram ewor k ser ves to i d en ti fy th e com m on el em en t s of su c h stan d ar d s

an d fac i l i tat e their i n c orpor ati on i nt o a un i fi ed syst em I i s eq u al l y

a pl i cabl e t o an y m an agem en t system , wh et he or n ot i t i s for m al i zed as a

m an agem en t syst em st an d ard Al l su ch systems h ave mu ch i n c omm on wi th

each oth er, wi th t he ad d i ti on of speci fi c r eq u i r em en t s r el at i n g to th e

p r t i c u l ar system Th i s fr am ework wi l l ac cord i n gl y for m the m od el fo an y

i n t egr ated man agem en t system i r respecti ve of t he d i fferen t systems or

d i sc i pl i n es t hat ar e to be i n cor por ated Th e fr am ework i s r epr od u c ed i n

Ap en d i x 1 an d i s t he b si s of th e syst em man u al pr esen ted her e The u se of

t he fr amewor k an d t he as oci at ed proces m ap i n g en abl es a si mpl er system

m an ual t o be em pl oyed i n t hat b ad d r es i n g t he el em en ts of th e fram ew or k,

t he en t i r e system c an be covered Au d i ti n g i s si m i l ar l y si m pl i fi ed

This bo k d oes not ad d r es the c ultur al o mana ement c hanges that ma

be nec es ar y to ac hiev e an integr ated sy stem Cer tain sy stems have often

tr ad itionaly be n r eg r d ed as the ‘pr oper ty’ of a sec tion of the busines –

ac c ou ts, pur c hasing o d esign, fo ex ample The ‘pr opr ietor s’ of these

systems ma not find it easy to ac c ept that it is the busines -w id e sy stem

that is impor tant – of w hic h their s is but a p r t

Furthermor e, this bo k is primariy c nc erned w ith the mana ement

sy stem at an operational lev el For the most par t, strategic c nsiderations

ne d to be c v er ed sep rately, although the principles ar e the same This is

c onsidered further in Chapter 7

I is hoped that this bo k w il be useful as an aid to prod uc ing a manual

to serv e those sy stems the busines already operates, as wel as prov iding a

f amew ork into w hich a ditional management sy stems, or new v er ions of

existing stand rds (fo ex ample, BS EN ISO 9 01:20 0) that the busines

w ishes to a opt, can be inc orporated

Abusines w il usually hav e a n mbe of distinct sy stems, some for mal and

doc umented, many informal and feq uently u related Surv ey s sug est

that most busines es hav e six or sev en d iferent sy stems in oper ation

Asit be omes rec ognized that these are al part of the ac tiv ity of r un ing

the busines , it is c lear that this u ity of purpose means that there is an

ad v antage to be g ined in integrating the sy stems The busines w il

prob bly hav e manuals or guid elnes c v er ing some of its ac tiv ities – a

q uality manual,perhaps, or a manual for the acc ou ts What is now ne ded

is a manual that c v er ex isting formal sy stems and also allows for the

future inclusion of other elements that are not cur ently p rt of the formal

busines sy stem

The objectiv s ofa busines

Any busines must aim to satis y its stakeholder , as otherwise it cannot

surv iv e In the case of a c mmercial busines , those stak eholder s wi

includ e c ustomer ,owner s, employ ees, neighbour and sup ler – all those

w hose lv es are affec ted in any w ay b the activ ities of the busines

With a publc bod y, o a sc ho l o hospital, the same lst a ples ex c ept that

the c ustomer s ar e the user s of the ser vic e and ar e not nec es ar ily the same

pe ple as those w ho p y fo it The ow ner s ma be tax pay er s o c har ities,

but they w il sti ne d to be satis ied b the per for manc e of the busines

Incr easingly, customer and other stakeholder w il se k assuranc on

the wa that a busines is r un and that there is transp rency in its

operations Re ent sca ndals in the activ ities of c rta in la rge publc

c mpanies hav e serv ed to r emind dire tor of their oblg tions in this area

Continua l improvement

Fo ev er y sor t of busines , the aim ought to be to ac hieve c ontin al

impr ovement in the ser vic e to stakehold er s Whie the r esults w il be

a p r ent at the mac r o lev el, over al impr ov ement w il in gener al be ac hieved

only b impr ovement of ind ivid ual elements w ithin the busines Ther e ma

be the oc c asional c ase w hen over al impr ovement is obtained at the top level

b , sa , ac q uisition o r efinanc ing, but suc h instanc es ar e r ar e The

op or tu ity fo impr ovement at the d etaied level is alw ays pr esent

The nor mal proc es of achiev ing c ntin al improv ement is b a plc ation

of the ‘plan-d o-che k-ac t’ (PDCA) c y cle Eac h element of the busines is:

rev iewed with the aim of further improv ement This is c nsider ed in

more d etai in Cha ter 6

Impr ov ement c an usually be car ied out only in respe t of indiv idual

proc es es w ithin the busines (o oc casionaly w ithin lnk ed groups of

proc es es) For it to be done efe tiv ely the pro es es within the busines

ne d to be id entified and their relationship establshed

Mod ern m an agem en t syst em s t en d to be con st r u c t ed arou n d proces es

r ath er t han pr oced u r es Th e i d en ti fi cat i on of pr oc es es an d t hei r r el at i on shi p

wi th each ot he i s oft en an es en ti al requi rem en t – for exampl e, i t i s a

r eq u i rem en t of BSEN ISO 9 01:20 0 Even i fn ot obl i gat or y, i t i s a u sefu l

th i n g to d o

The meaning of‘proces ’

Apro es is often defined as the mec hanism w hereb an input is c nv erted

into an output How ev er, as is often the c ase with definitions, this is not

par ticularly helpful or informativ e Often, the ter m is defined in a

manufac tur ing c ntex t – but this is not a eq uate either

The objec tive of any busines is to ad d value to its inputs to me t the ne d s

of its c ustomer s, and a pr oc es is any ac tivity that for ms p r t of that

seq uenc e of ad d ing v alue Enter ing an or d er o answ er ing an enq uir y ar e

both pr oc es es, but so is answ er ing the telephone c al, w hic h ma be the

star t of eithe ac tivity.Ther e is an input – in this c ase a telephone c al – and

somebod y d oes something, o something ha pens, that pr od uc es an output

This output w ould pr ob bly be the input to the nex t pr oc es in the seq uenc e

Atahigh level, one ma r eg r d ac tivities suc h as mar keting, bud geting or

d esign as pr oc es es, but eac h of these w il in pr ac tic e be a c olec tion of many

othe pr oc es es The fu d amental ac tiv ities of the busines – w hether

making and sel ng a pr od uc t, making sic k p tients healthy a ain, or

ed uc ating a c hid – c an be r eg r d ed as pr oc es es, w hic h w il br eak d ow n

thr ough n mer ous levels to suc h b sic ac tivities as answ er ing the telephone

Ev en the lar gest busines w il usualy be a le to d esc r ibe its ac tivities in

ter ms of thr ee o four high-ev el pr oc es es

In the p st, q ualty sy stems in p r tic ular have emphasized the impor tanc e

of pr oc ed ur es r athe than pr oc es es This sometimes lead s to c onfusion

betw een the tw o, and it is impor tant to d istinguish them A pr oc es is any

ac tivity that is p r t of the ad d ition of value, w hic h is the busines of the

organization

An y acti vi t y o set of acti vi ti es th at u ses r esou r ces to t r an sfor m i n pu ts

to out pu ts c an be con si d er ed as a pr oces (BS EN ISO 9 0 :20 0)

Apro edur e desc ribes how an activ ity is to be car ried out I is c nc erned

w ith means and methods rather than inputs and outputs Along w ith

operating instructions, a proc edure d escr ibes how a proc es is to be c arr ied

out; it do s not d efine the proc es

Asi mpl e exam pl e i s recei vi n g an or d er from a cu stom er an d en ter i n g i t i n to

t h e sal es system In i ti al l y, th e sal es cl erk m ay h ave wri tten the or d er on an

ord er for m , an d a pr oced u r e o oper ati n g i n stru c t i on w oul d d esc ri be h ow thi s

was t o be d on e L at er, a com pu te syst em i s i n stal l ed t hat en abl es the c l er k

t o en te th e ord er on t he com pu ter Th i s wou l d requi re a d i fferen t pr oced u r e

t o be w ri tt en Th e proces , h owever, wou l d be u n c h an ged – i t wou l d sti l l be

recei vi n g t he ord er an d en t eri n g i t i n to the sal es system ; on l y th e m et hod of

ord er en t r y has chan ged If th e c omput er system en abl es the cl er k t o d o

t h i n gs t hat t hey cou l d n ot d o before, such as chec ki n g st ock avai l abi l i ty or

gi vi n g t he custom er a fi r m d el i very d at e, th en these ar e n ew pr oces es

If a busines has a go d set of pr oc d ures, these c an be useful in helping

todefine the proc es es, but the distinction betw een the two must be kept

c lear Proc edures or operating instructions ma sti be ne ded to d escr ibe

how the pro es is to be car ried out, but they wi not d efine the proc es I

w il be fou d to be useful if spe ific (rather than gener al) pro edur es or

operating instructions c arry a referenc to the pr oc s to whic h they refer

Busines es hav e traditionally tended to hav e an organizational structure

that is v er tical – that is, b sed on fu c tions within the busines – and this

is sti lar gely the case The initial sta es of an enq uiry or plac ing an order

w il ty picaly c ome w ithin the responsibi ty of a sales fu c tion, hea ed

perhaps b a sales direc tor This is folowed b the aloc ation of the order

b production plan ing and the ex ecution b a production or operations

fu ction head ed perha s b an operations d ir ector This w il be ty picaly

folow ed b desp tch, tr ansport, inv oicing and c lec tion, each with its

separate fu c tional management For ex ample, the same proc edures, but

w ith diferent titles, wi apply to a hospital, sc ho l or polc e station

In c n t rast , t h e sequ en ce of proce sse s wi t h i n a bu si n es s i s es sen t i al l y

h ori zon t al , cu t t i n g acros s t h e vert i cal st ru ct u re from t h e fi rs t i n pu t s t o fi n al l y

re ach i n g t h e cu st om e r Th i s i s l arge l y t h e v l u e of a proach i n g t h e bu si n e ss

t h rou gh i t s proce sse s rat h er t h an t h e t rad i t i on al fu n ct i on al ap proach – i t i s

se en as a wh ol e ,n ot as a seri es of sep arat e com p art m en t s Th i s d oe s n ot i m pl y

that there is any ne d to cha nge f om the fu ctiona l management

organ i zat i on , wh i ch m ay st i l l be a propri at e Th e st ru ct u re wi l l n e ed t o

re cogn i ze, h oweve r, t h at t h e i n t egrat e d syst em of t h e bu s i n es i s n ot re st ri ct ed

b a ve rt i cal m an age m en t st ru ct u re an d t h at t h e syst em m an age r, for

e xam pl e , wi l l h ave a re spon si bi l i t y t h at cu t s acros al l t rad i t i on al fu n ct i on s

Onc the proc es es inv olv ed in the busines hav e be n c dified and

mapped , the a plc ation of the req uirements of any spe ific mana ement

sy stem can easiy be se n This is the case whether in relation to q ualty or

o c up tional health and safety, for ex ample, or to the org nization’s

ac cou ting sy stem, sales, per on el o any other They all finaly relate to

proc es es and can be add res ed ac cordingly

Th e pr od u c t i on of a proces m ap i s i n i tsel f a rewar d i n g exer ci se, q u i t e

a art fr om t he su bseq u en t u ses to whi ch i t c an be pu t It portr ays wh at the

bu si n es i s a ou t i n t otal , r ath er th an t he p r t i c u l ar secti on o fu n c t i on wi th

whi ch th e i n d i vi d u al i s con cern ed It t her efor e ser ves to r em i n d ever yon e of

how th ei r ac t i vi t y fi ts i n to th e overal l c omp n y objecti ves, an d i s acc or d i n gl y

i n val u abl e i n bu i l d i n g a team r athe than a d ep r t men tal att i tu d e On e l ar ge

q u ar ryi n g c omp n y, fo exam pl e, d i st r i bu tes i ts pr oces m ap t hrou gh ou t al l

its qua rries a nd ma nufa cturing opera tions, with the lo a l a ctivities

hi ghl i ght ed to show thei r pl ace i n th e overal l busi n es acti vi t i es

The id entific ation of pr oc es es w ithin a busines not only ena les a

pr ogr amme of c ontin al impr ovement to be c ar r ied out, but it also per mits

the a plc ation of r isk analy sis to eac h element of the busines This is

inc r easingly r ec ognized as an es ential element in busines mana ement,

and the subjec t is c onsid er ed in mor e d etai in Cha te 4 Many faiur es in

busines es ar e the r esult of fai ng to a pr ec iate that ther e ar e r isks

as oc iated w ith any ac tivity Fo to long, busines es w or ked on the u stated

as umption that tomor r ow w ould be just lke tod ay, ex c ept that things w ould

pr ogr es ively get bet er To many c omp nies have r ec ently ex per ienc ed a

r ud e aw akening fr om this at itud e I is not only the spec tac ular event that

c an spel the d ow nfal of a busines ; it is mor e lkely to ha pen as a r esult of

smale u c onsid er ed events, suc h as poltic al c hanges, o ex c hange r ate

fluc tuations, o tec hnic al o fashion d ev elopments The id entific ation of

these r isks, and a pr ogr amme to mana e those that pr esent a signific ant

thr eat to the suc c es of the busines , is es ential I is inc r easingly

d emand ed b stakehold er s and not only the ow ner s of the busines , but

c ustomer s, employ ees and sup ler s to be as ur ed that r isks ar e id entified

and mana ed

Proces ma ping

The pr oc s approach desc ribed in this bo k enables all these fu ctions to

be c v ered

Initially, al pro es es in the busines ne d to be identified lev el b lev el

u ti all are c v ered, showing how each relates to the other pro es es with

w hich it is as o iated

Th ere ar e vari ou s ways i n whi ch th e pr oces es c an be r ec ord ed an d

por trayed Th e i m portan t th i n g i s t hat th e proc ed u re i s for m al i n ac cord an c e

wi th a c on si sten t c on ven ti on For m os purposes, i t m ay be fou n d that

proces m ap i n g u si n g ac t i vi ty sequen ce fl ow char t s i s t he m os a pr opr i ate

Asi m pl e exam pl e – maki n g a c u p of t ea – i s sh own i n Fi gu r e 3.1

The other de ision to be taken is w here to start – that is, w hether to wor k

top-down or bot om-up I is tempting to start at the top, as top-ev el

proc es es c an be easiy defined, often b just one per on The dific ulties

that then arise are in dr iv ing the proc es d own throughout the busines ,

maintaining momentum w hie inv olv ing incr easing n mber of pe ple at

each stage

For most organ i zati on s, th e bot tom -up a proac h i s pr efer abl e Th i s en abl es

t he pe pl e who actu al l y c ar ry ou t th e pr oces to d o the m ap i n g (afte br i ef

per h aps m os i m por t an t ofal l , t he wor kforc e i s i n vol ved i n the

operat i on an d wi l l com e to a preci ate th ei r pl ac e i n t he acti vi t i es of the

bu si n es As an ai d to fost eri n g a t eam at i t u d e i t can be i n val u abl e

For a busines where the n mbe of pro es es is not great (and this has

nothing to do w ith the size of the busines – some of the lar gest c nc rns

may be simple in proc es ter ms), a manual sy stem apply ing the c onv entions

in Ap endix B to the sample sy stem manual (se Chapter 8) can be used

For more c mplex busines es, a c omputer-based sy stem ( here are many

p ckages av ailable) may help to make the task more mana eable

Whatev er sy stem is ad opted, it is es ential that eac h pr oc s can be se n

in relation to those that c ome before and after, and that al proc es es within

the busines c an be c v ered At least c onc eptually it must be pos ible to

c onstruc t a single pro es ma c v ering the w hole busines

Fig r e 3.1 Pr oc s ma ping using act ivit y s q enc flow char t

To keep the relationship betw een pr oc s es clear, a sy stem of n mbering

the proc es es should be dev ised that w il a ply throughout the busines

T he P roc es s M ap R es ourc es nee ded

This should be the responsibi ty of the sy stem manager, as should

superv ision of the entire pr oc s -ma ping activ ity

Note that the pro es ma as portray ed in Figure 3.1 is not the same as

acritic al p th d ia ram The pr oc s es w il be the same, but the ord er in

w hich they ar e c arr ied out ma be diferent, w ith some tak ing place in

p rallel When making a c up of tea, it is sensible to put the w ater in the

ket le and put it on to boi before put ing the tea bag in the c up If a c ritical

p th dia ram of a pro es ex ists this can eq ually be taken as a b sis for the

proc es map

The pr oc s map should be regar ded as a busines resour ce, not the

property of any department o series of departments The r esults should be

f e ly av ailable to ev ery mana e or per on in a managerial position

throughout the busines

Each proc es rec orded should show the inputs ne ded to achiev e the

proc es These w il include resourc es such as plant, buidings, serv ic es,

eq uipment, per on el and skils Other inputs ma be purchases o other

sup les f om outside the busines , and/or the outputs fom other pro es es

w ithin the busines These should be formally rec orded in a u iform sty le,

a ain id eally as part of a c mputer-based d tabase, and the information

reg rded as a busines resourc e

I is important to r ec r d w hich of the input resourc s are used exc lusiv ely

in the per ormanc of that partic ular pro es , and whic h are used in

c ommon with other proc es es ( his c uld includ e, for ex ample, buidings,

serv ic es o c mputer sy stems) This is signific ant when c nsidering the

risks attac hed to eac h element and w hat should be done about them

The objec tiv es of each pr oc s should also be rec orded, together w ith the

name and title of the mana e responsible fo the pr oc s and the means of

monitoring the pro es (including methods of measurement and rec ording

the results of the pr oc s ) Ex isting pro edures and pro es lay outs ma

prov ide much of this information An ex ample is show n in Figure 3.2

Dimensions of a busines system

The ar eas of a busines most f eq uently c v ered b formal sy stems are:

Fig ur e 3.2 Example o pr oc s ma ping

In a c mprehensive busines system, the folowing depa rtments or

fu ctions are also lk ely to be c v er ed, although the lst w il v ary ac cording

to the size and nature of the or ganization:

Proces s Re fe r e n ce 1.A.1

Ord e r Re cei pt an d Han dl i n g

I nput, r al i zati on and output

Res ourc es ne ded

The nex t sta e is to analy se the risks attached to eac h pro es

This is a subje t that feq uently causes dificulty, but in c nc pt it is

simple; most of the pr oblems arise through the ter minolog used

For each pro es y ou ne d to ask the folow ing q uestions

Are the seriousnes and the lkelho d that something wi go w rong

such that something ne ds to be done a out it?

That is al that ther e is to r isk analy sis The subjec t is d ealt w ith in mor e

d etai l in this c ha ter, but ther e is one impor tant point that should be mad e

now : it is not only things going w r ong that should be c onsid er ed , but things

going r ight The c losur e of a p r tic ular mar ket ma have majo implc ations,

but so ma the opening of a mar ket that has be n c losed – as w ith, for

ex am ple, R us ia and China The ad vent of new mater ials (fo ex ample,

plastic s and c er amic s) o new tec hniq ues (CNC mac hining and antibiotic s)

ma pose a thr eat to tr ad itional method s, but ma also open up new

op or tu ities in both method s and pr od uc ts

The risk analy sis of eac h pr oc s is at the heart of the busines sy stem

Most organizations that fail do so be ause they hav e not c onsidered the

d nger to whic h they ar e ex posed or, eq ually important, hav e failed to

re ognize op or tu ities that hav e presented themselv es

This appr oach is sensible in al organizations, but in many it is a

non-negotiable regulatory req uirement – for ex ample, in health and safety or

fo d safety

Identifica tion of a spect

The pr oces of r i sk as es m en t con si st s of th r ee st ages The fi rst i s to i d en t i fy

t hose th i n gs t hat c oul d go wr on g – or ri gh t Then th e con seq u en ces of su ch

an occ u rr en c e n eed to be c on si d er ed , an d th e l i kel i h ood that i t wi l l h ap en

Eac h pr oc es w il d epend on c er tain c r itic al fac tor s on w hic h the suc c es ful

c onc lusion of the pr oc es d epend s These ar e know n as aspec ts These

aspec ts ma inc lud e the avaia i ty of c er tain ser vic es (suc h as elec tr ic ity,

telephones o c omputer s) o a c er tain spec ialzed piec e of plant, o the

avaia i ty of an oper ato w ith p r tic ular skils, and so on The q uestion to

be asked is ‘w hat c ould go w r ong w hic h w ould pr event the pr oc es being

c ar r ied out suc c es fuly ?’ Remembe that although aspec ts ar e fr eq uently

r efer r ed to as ‘hazar d s’ this imples that their efec t is alw ay s d ama ing

This is not the c ase The efec ts ma be benefic ial just as they ma be

d ama ing The hazar d ter minolog is a pr opr iate only in suc h ar eas as

health and safety o fo d safety, w her e the r isk is alw ay s d ow nsid e The

mor e gener al q uestion is not ‘w hat c ould go w r ong?’but ‘w hat might c hange

that w ould afec t this pr oc es ?’

In our simple ex ample of making a cup of tea, the aspe ts that c ould go

w rong and the efe t that they hav e on the output are show n in Table 4.1

Table 4.1 Risk analysis – ma ing a cu o t ea

Cup not av aiable (lost, ro e ,cracke ) No t ea 2 Hig h

Ket tle not av aiable (not t ested,bro e ) No t ea 1 L ow

A sp ct to b co sid re

Ex mples of aspe ts to be c nsidered include the folow ing

u r est or w ar in sup ler c u try.

Plant and eq ipme t :

Risk asses ment matrix

Asimple matr ix to giv e a measure of the r isk attac hed to a pr oc s is show n

in Figure 4.1 and in Ap endix F to the sample manual in Chapter 8

Fig r e 4.1 Risk as e sment mat r ix

Any method of gr ading can be used , but the temptation to make a mor e

ela orate or pr ecise sy stem (for ex ample, using scales of 1 to 10 instead of

1 to 3) should be treated w ith c aution R isk measurement can nev er be an

exa ct scienc a nd the a sses ment must be qua lita tive ra ther tha n

q uantitativ e The es entials are that a distinction is ma e betwe n those

risks that repr esent a serious thr eat in any of the dimensions of the sy stem

that ne d immed iate at ention, and those that, w hie not toler able, do not

ne d attention with the same degre of urgency

I must also be remembered that duration is an important element of an

impact Most busines es c ould surv iv e a faiure of a telephone sy stem that

lasts only half an hour,but perhaps not one that lasts sev eral d ay s

A distinction also ne ds to be mad e betwe n those impac ts that hav e a

ser ious efe t on that pro es , and those w here the imp ct is on the w hole

busines , the env ironment or the w orld Whie this is c mmon sense, it can

be obsc ur ed if a me hanistic approach is taken to the subje t

Risk ana lysis example

Table 4.2 is a simple ex ample of the applcation of risk analy sis to a proc es

that ar ises in one form or another in almost any busines

Table 4.2 Risk analysis example

Order re eipt and handlng pro es R ef:1.A.1

Dime si ons of t he syst em

A Qu lty

B Oper ati n l h alth a dsafety

C Env ironme t

D Custome satisa ti n

E S les a dmar ketin

F Costs/ fin n ial

G Huma rsou c s

1 S les ofic u av aiable (ir ,u safe) X X X X ( Sh rd)

Ma aer resp nsible:S les Ofice Ma a er

Note: W hee rsou c s a to be sh r d wit h othe proc ses, t is cle r that the impa ts n e t o

be consid rd in conju cti n with those att ac e to the othe afe ted proc ses

Proposed co t rol me sures

A spe t Cont rol measures pro ose Cos Time to Risk re u tion

Risk asses ment

Onc e these aspec ts or hazar ds hav e be n identified, the nex t sta e is to

deter mine whic h of the dimensions w ould be afe ted – fo instanc , would

it affe t the q ualty of the output, d ma e c ustome serv ic e, pr ejudic the

health and safety of employ ees or hav e d ma ing c st efec ts

Having id entified the aspec ts and the d imensions in w hic h they w ould

have an efec t o imp c t, the nex t sta e in the r isk as es ment is to

d eter mine how ser ious the imp c t w ould be Could it be a smal d isc har ge of

non-tox ic fumes, o a Bhop l? Would it r esult in a few id entifia le

substand ar d pr od uc ts o a c omplete pr od uc t r ec al? Would it halt pr od uc tion

fo a few hour s, o fo w eeks and months Whie it is not feasible to at r ibute

spec ific values to suc h efec ts, they c an at least be gr ad ed on a sc ale fr om

‘slght’ to ‘d isastr ous’ o 1 to 10 o ev en 1 to 10 Ther e ne d s to be some

w ay of ex pr es ing the d egr ee of ser iousnes in a u ifor m w ay

Th e t h i rd e l e m e n t of ri sk as e ssm e n t i s t o ass es h ow l i ke l y t h e e ve n t i s t o

h app en Th i s i s a m at t er of ju d gem e n t , c m m on se n se an d h i st ory If t h e

prem i se s h ave bee n fl ooded i n t h e p st , i t i s n ot i m prob bl e t h at t h e y wi l l be

a ai n El e ct ri ci t y su ppl i e s d o fai l , as do t e l ep h on e syst em s an d com p u t ers

Wh at wou l d an i n su ran ce c m pan y ch arge t o c ve r t h e ri sk? Or wh at odd s

wou l d L adbrokes gi ve you ? Al m os t an y e ven t cou l d c n ce i va l y h ap e n , bu t

som e are so u n l i ke l y t h at t h e y can be di sre gard e d Ot h ers wi l l al m os c rt ai n l y

h app en at s om e t i m e , bu t t h e qu e st i on i s wh e n or h ow oft en Re m e m be r t h at

i fan e ve n t i s ju dge d l i ke l y t o h ap e n on ce i n a h u n dre d ye ars, t h at m ean s i t

i s ju st as l i ke l y t o h app en n e xt year as i n 50 ye ars’ t i m e

The ter m ‘lk elho d’ is to be prefer red to ‘pr obabi ty ’ in this c ontex t to

av oid c nfusion with the mathematical definition of pr obabi ty that is

c onc erned with random ev ents

The c ombination of the c hanc s that something w il happen and the

efe t, or imp ct, if it do s happen is the measure of the risk If something

is v er y u lkely to ha pen and the c onseq uenc s ar e not serious ev en if it

do s, then the risk is low and can probably be ignor ed If it is u lkely, but

the c onseq uenc s would be v ery serious (as, for ex ample, in the case of

Chernoby l), then all pos ible means wi ne d to be taken to minimize the

risk I can nev er be elminated entirely, but all prac ticable steps must be

taken to red uc e the lkelho d of the ev ent happening and also the a v er e

efe ts if it should happen

In prac tical terms, most risks w il be a c ombination of things that c ould

w el happen with moderately serious c nseq uenc es fo the or ganization

Ex amples of pos ible aspec ts (hazar d s) in v ar ious fu c tions of a c omp ny

r efer r ed to as hazar d s, it is impor tant to r emembe that they c an be positive

as w el as neg tiv e A shar p r ise in the pr ic e of a r aw mater ial ma be se n

as a hazar d , but w ould a fal in pr ic e open up new op or tu ities fo the

busines , and should c ontingenc y plans be mad e fo this to ?

I is also important to remembe that there is some risk at ac hed to just

about ev er y thing Hu dreds of pe ple are str uc k b lghtning ev er y y ear,

but w e do not spend our time w or y ing a out it I is u lkely that an

airc raft wi c rash into y our buiding, but if y our ofic e is c lose to the end of

ar unw ay of a busy airport the airc raft risk ma bec ome one that y ou w ish

to c onsider

The lst of aspe ts (hazards) identified in respe t of eac h proc es can now

be augmented b the lkelho d or prob bi ty of the ev ent ha pening and

an a prox imate measure attr ibuted

Ever y pr oc es is ther efor e d epend ent on a n mbe of es ential inputs

(aspec ts), and as oc iated w ith eac h of these is a r isk element The analy sis

w il pr ob bly show that most of these r isks ar e so smal that they c an be

c onsid er ed toler able and no fur the ac tion ne d s to be taken I is lkely,

how ever, that one o tw o r isks w il stand out as u ac c epta le

Th i s l ead s t o t h e se con d el e m en t i n ri sk m an age m en t – n am el y, ri sk

t reat m e n t How can t h e organ i zat i on redu ce or c n t rol t h e ri sks so t h at t h e y

be com e t ol erabl e? For eve ry s i gn i fi can t ri sk, t h ere are p rob bl y seve ral

pos si bl e ways of re d u ci n g i t t o a t ol e rabl e l eve l , each wi t h i t s own i m pl i cat i on s

of c st , e ffe ct i ve n e ss, ease an d sp ee d of i m pl e m en t at i on an d s o on

The aspec ts (hazar ds) are initially identified in respe t of each pr oc s –

the responsibi ty les w ith the departmental mana er for se ing that this

is done Simiarly, the impac ts, lkelho d and risk wi be asses ed within

the same area, w ith outside spec ialist assistanc e as req uired The same

gr oup w il initially propose and probably de ide on the risk treatment

ac tions to be taken

There ar e tw o areas where risk treatment at the departmental lev el is

inappropriate

Fi rs t , wh ere se veral d i fferen t dep art m en t s i d e n t i fy t h e sam e si gn i fi can t

aspe ct s, su ch as t h e avai l abi l i t y of s ervi ce s (for e xam pl e , e l ect ri ci t y,t el e ph on es

or com p u t ers) i t wou l d be i n ap ropri at e for each d e part m e n t t o c m e u p wi t h

i t s own an al ys i s of t h es e ri sks an d t h i s n ee d s t o be carri ed ou t at a h i gh er l e ve l

Th e dep rt m en t s h ou l d , h owe ver, regi st e r t h e s eri ou sn es s of t h e ri sk as far as

i t s own act i vi t i es are c n cern ed, as ot h e rwi se t h at si gn i fi can ce m ay n ot be

fu l l y a p re ci at e d A fai l u re t h at h as on l y a sm al l i m pact on e ach of a n u m ber

of d e part m e n t s m ay h ave a si gn i fi can t i m pact wh e n c n si d e re d acros s t h e

wh ol e bu si n e ss

Se ond, at the str ategic lev el, w hich may ov erlap w ith the fir t – for

ex ample, a dec ision to hav e a se ond p rallel c mputer sy stem in operation

to safeguard against failure, or the installation of stand y elec tricity

generator There are other str ategic risks that the busines may ne d to

c onsider that d o not fit rea iy into the pro es ma S c h c onsiderations

as c hanges in exc hange rates, the lkelho d of war in for eign parts o ev en

the activ ities of c mpetitor ma be of major signific anc , w hich should

c learly be inc luded as part of c r porate gov ernanc Whie the man al is a

suitable v ehic le for oper ational risk analy sis, sep rate arrangements ne d

to be ma e to ensur e that strategic risk management is c v ered The

subjec t is c nsidered more fuly in Chapter 7

Confide tiality

In pr inc iple, information about the proc es es of the busines and the r isks

at ac hed to them should be w idely dis eminated throughout the busines

The more pe ple inv olv ed in id entify ing r isks and making sug estions

a out the best way s of managing them, the more lk ely it is that the

optimum solution w il be fou d , and multidiscipl nary teams are alway s to

be prefer ed I is often the non-spec ialst outside w ho can se risks that

are not a parent to those closely inv olv ed in the pro es , and w ho may be

a le to se solutions that ar e not obv ious to those closely inv olv ed

I has to be re ognized, how ev er, that c nsiderations of c nfidentialty

may arise For c mmercial reasons, the details of some proc es es may be a

c losely guarded sec ret The risks attached to c ertain activ ities may be such

that the infor mation must be kept fom c mpetitor s or f om the publc In

these circ umstanc es, the top mana ement ne ds to restrict any disc us ion

of the is ues to a smal c ircle, and ensure that the infor mation is kept out

of the c omp ny data ase Se ret proc es es should sti be re ord ed, but

described in suc h a wa as to not rev eal sensitiv e infor mation The de ision

to keep c rtain matter c onfidential should be taken b the chief ex ecutiv e

only and such instanc es k ept to a minimum There is a tendenc y for

manager to tr y to keep a lot of information sec ret w hen in r eality this is

not only u nec es ary, but also deleter ious to the total busines

In all but the simplest busines , mapping al the pro es es is a major task

and one that is not to be u dertaken lghtly One ma be embarking on

a progr amme that may take y ear before ev ery activ ity in the busines

is c v ered

This should not be a deter ent – benefits can be ex pec ted to ac r ue f om

d y one for the folow ing reasons:

•

the wor k c an be d one in p rallel throughout all areas of the busines ;

•

afte brief initial training, the work c an (and should) be deleg ted

The mor e that the pro es ma ping and identification of aspec ts is

car ied out b pe ple ac tually doing the work, the more lkely it is to

be acc urate and kept up to d te;

•

this inv olv ement of n merous pe ple at all lev els thr oughout the

organization is in itself of v alue in mak ing them aw are of the

fu ctions of sy stems throughout the busines and enc oura es a team

ev en the ac tion of proc es mapping may be instrumental in

identify ing op ortu ities for improv ed eficienc y and c ost red uc tion

Th e probl em i s t hen on e of m an agem en t , pl an n i n g an d t r ai n i n g The fi rst

st ep wi l l be t o sel ect a system man age (n ot n eces ari l y w i t h th at ti tl e) who

wi l l be r espon si bl e t o th e chi ef exec u ti ve fo th e i m pl em en t at i on an d

m ai n t en an ce of th e w h ol e projec t Cl earl y t he job i s of a d i ffer en t or d er of

m agn i tu d e from th at of, sa, a t ypi cal q u al i ty o safety man ager, al t hou gh

ei the r of these wou l d br i n g som e experi en ce of the t echn i ques u sed Wh oever

i s a poi n ted w oul d al m ost c er t ai n l y ben efi t from a sh or t t r ai n i n g c ou rse on

i n tegr ated m an agem en t system s Th e pr i n ci pal man ager s then n eed to

recei ve hi gh-l evel trai n i n g on the ai m s an d m ethod s of t he projec t , an d the

way i t i s to be c ar ri ed ou t Toget he wi th t he syst em m an ager, t hey w i l l t hen

d eci d e on person n el , t i meta l es, t r ai n i n g an d an yth i n g el se t hat i s n eces ar y

t o tu rn th e pl an s i n to a real i ty

From then on it should be the r esponsibi ty of the sy stem manager to

ensure that the proje t r uns ac or ding to plan, w ith the chief ex ecutiv e

ensuring that the sy stem mana er r ec iv es the sup ort and c ooperation

they ne d Progr es should be repor ted regular ly at mana ement me tings

The PDCA improvement cycle

Th e e sse n ce of con t i n u al i m prove m en t , wh i ch m u s t be t h e ai m of an y bu si n e ss

m an agem e n t sys t e m , i s t o ex m i n e al l proce sse s at al l l eve l s t o i n ve st i gat e

h ow t h e y m ay be i m proved

In general, a proc es w il be jud ed in terms of the v alue that it a ds to

the ov er all activ ity and henc to the busines as a w hole In practic e, it is

not alw ay s easy to measure the add ed v alue at ributable to a partic ular

proc es , espe ially at a low lev el, and henc the emphasis may hav e to be

on add ed c ost bec ause it is easier to measure

Th e fi rst q u esti on t o ask of an y pr oces i s wh at t hat pr oces i s i n t en d ed t o

ac h i eve Is i t n eces ar y at al l ? Wh y i s i t n ec es ar y? The greatest i m provem en t

th at can be achi eved wi th an y pr oc es i s to el i m i n ate i t en ti rel y, so l on g as t hi s

d oes n ot pr eju d i ce th e overal l achi evem en t In al m ost an y bu si n es ther e wi l l

be proces es o acti vi t i es th at have grown u p b cu stom an d practi ce, the

u sefu l n es of wh i c h h as l on g d i sa pear ed , bu t wi th n o on e havi n g taken t he

posi ti ve step of st op i n g t hem

Hav ing esta lshed that the proc es is ne es ary, the nex t stage is to

ex amine whether it c an be d one more efe tiv ely.This means whether it can

be done more ec onomicaly, or whether it c an achiev e more Two or more

sep rate pro es es can often be c ombined w ith c onsid era le c ost sav ings I

should be q uestioned w hethe the pro es has to be done at this loc ation or

at this sta e in the ov erall pr oc s Why here? Along w ith this go s the

q uestion of who is doing it and w hy ? The proc es c ould be car ied out mor e

ec onomicaly and efec tiv ely b a diferent per on, perha s in c nju ction

w ith another proc es

The improv ement options w il often fal into one of thre c ategories.

•

Streamlning – can the c omplex ity be reduc d? Can the proc es be

remov ed or c mbined w ith another

Al pr oc s es should be ex amined f om the point of v iew of av oid nc of los

(or c ost).Although this ma be regarded as a negativ e appr oach, in practic e

los is often easier to identify than inc rease in ad ded v alue The te h iq ues

of v alue engine r ing, w hich has the same aims of c ontin al impr ov ement,

may prov e useful in these studies

Hav ing de ided w her e improv ements ma be mad e,their implementation

has to be planned ( he plan sta e of the PDCAcy c le) This plan ing must

include c sts and benefits, time for implementation and the impac t on not

only the d imensions c ov ered b the mana ement sy stem but also on other

proc es es, per son el and dep rtments

On c e the nec es ar y a r eement has be n obtained (inc lud ing any nec es ar y

auth or ity to spend the money ), the impr ovements c an be implemented This

is the d o sta e of the PDCAc y c le

Aft er th e c h an ges have be n i m pl emen ted an d have be n r u n n i n g fo a

per i od of t i m e, chec ks n eed to be m ad e to se th at th e i m pr ovem en t s

en vi s aged h ave be n r eal i zed How the i m provem en t i s t o be m easured

(whe th er b c ost savi n gs or i m proved ou tpu t, fo exam pl e) shou l d h ave be n

speci fi ed at t he pl an n i n g sta e, al on g wi th t he per i od for fu l l i m pl em en t at i on

aft er wh i c h i t i s sen si bl e t o measu r e t he efects Thi s i s t he c h eck sta e of t he

PDCAcyc l e

If any of the c hanges hav e failed to produc the planned r esults then

these ne d to be re-ex amined and the nec es ar y changes made If all has

gone acc ording to plan then ar rangements ne d to be mad e for repeating

the pro edure to achiev e another rou d of impr ov ement This is the ac t

sta e of the PDCA cy cle

This bo k has so far be n c nc rned w ith the ac tiv ities of risk as es ment

and c ontin al improv ement in the operations of the busines

The top-ev el manager of the busines also hav e to c nsider the risk s

attac hed to the future of the busines as a w hole and the appr opriate

measures ne ded I ma be argued that these are no diferent fr om the

analy sis of proc es es, and can be v iewed as the same as a risk analy sis

regar ding the activ ities of the busines as a single proc es at the highest

lev el This v iew is tena le, but not helpful

The ac tiv ities of the busines w il d epend on c rtain basic req uirements

and to often it wi be as umed that these wi c ontin e u c hanging In

more set led times this might hav e be n a reasonable assumption, but in

the circ umstanc es of today it is u r easona le

Al l th e b si c r eq u i r em en t s ofth e bu si n es shou l d be exam i n ed an d a r i sk

factor a pl i ed to each of t hese aspec t s, n o m at te how i m pr ob bl e a p r ti cu l ar

r i sk ma a pear Even i fso i m pr ob bl e th at th e ri sk c an be d i scou n ted , th e

r i sk has at l eas be n i d en ti f d an d con si d er ed If, when c on si d er i n g th e

l i kel i ho d , i t i s fou n d to d i ffi cu l t t o u se th e 1, 2, 3 sc al e su ggested i n Fi gu r e

4.1, q u al i t at i ve ter m s m ay be used su ch as ‘pr ac t i c al l y i mpos i bl e’ an d ‘very

u n l i kel y’ at on e en d t o ‘very l i kel y’ an d ‘al m os c er t ai n ’ at th e other

Man y of the r i sks to be con si d ered w er e l i st ed i n Cha t er 4 Most

busines es ne d premises f om which to work , whether they a re a

m an u factu ri n g bu si n es , sh op, h ospi t al or scho l Coul d t hey su r vi ve i fth e

prem i ses were d estr oyed b fi r e, fl ood o ear th q u ake? The an sw er i s n ot

al w ays t hat th ey cou l d n ot survi ve Dom est i c worki n g an d c al l c en tres, for

exam pl e, have d i st r i bu ted th e acti vi ti es of m an y c on c er n s Som e exi st on l y as

‘vi r t ua bu si n es es The In ter n et cam e i n to bei n g as an att em pt t o su r vi ve

th e pos i bl e d estructi on of m i l i tar y h ead quar t ers Most bu si n es es, however,

wi l l n eed to c on si d er an y si gn i fi c an t th r eat t o t hei r pr em i ses as a th r eat t o

th e bu si n es Su ch a t hreat cou l d , of cou r se, ar i se from the en vi ron m en t Is

t he bu i l d i n g n ext d oor t o a n ucl ear pow er st at i on , a fi r ewor ks factory o a

bu sy ai rport run way?

If the r isks are c nsidered intolerable, a mov e or ev en a se ond loc ation

may be de ided on A gov erning bod that d id not c nsider such r isks and

take action w here appropriate c uld be held to hav e failed its stakeholder

In the case of a publc lmited c omp ny it is a req uirement in the UK that

the dire tor take c ognisanc of the risks attached to their busines , and

only c mpanies that can demonstrate that they do so are elgible to hav e

their shares lsted on the London Stoc k Ex c hange Fur the details of these

req uir ements ar e giv en in PD 6 6

Surv iv al is a b sic instinct w ith busines es as w el as h mans One of the

greatest perc iv ed r isks is f eq uently that of an u welc me takeov er bid

This ma be f om another publc c mpany, or may be a pr oposal fr om a

health authority to merge hospitals, or the thr eat of ‘re r ganization’ b a

gov ernment dep rtment Management efort w il often then c onc entrate on

c ou tering this perc eiv ed threat In othe circ umstanc es, a busines that

se s dific ult times ahea ma go out delberately to se k ac q uisition or

amalgamation In determining the a proac h to be taken, it is the interests

of stakeholder in total that should be c nsider ed – that is, customer ,

employ ees and sup ler , as w el as ow ner Too often it is the interests of

the mana ement that deter mines the pol c y and this ma not be to the

benefit of the majo stakehold er

Afu rthe vi tal el em en t i n con si d eri n g t he aspects of the bu si n es i s often

t he com pu te an d i n for m ati on systems Whi l e a bu si n es m ay su r vi ve th e l os

of i ts pr em i ses, i t i s l es l i kel y th at i t wi l l su r vi ve th e l os of i t s i n form at i on

an d c om pu t er systems A total fai l u r e wou l d prob bl y be as oc i ated wi th th e

l os of prem i ses, bu t havi n g th e system i n operat i ve fo a d ay o two, o th e

l os of d ata, cou l d spel l t he en d of a travel a en c y o a mai l ord er fi r m an d

cou l d sever el y preju d i c e th e efecti ve w or ki n g of a hospi tal The l os of sec ret

i n for m ati on – such as a for m u l a, reci pe or even a c l i en t l i st – cou l d mean th e

en d of som e con cern s

Th e requ i re m e n t i s t o t h i n k of an yt h i n g t h at cou l d go wron g – or e ven

an yt h i n g t h at c u l d go ri gh t Ne w m arke t op ort u n i t i e s m ay su d den l y e m erge

(as wi t h , for ex m pl e, Ru ssi a an d Ch i n a) or n e w m at eri al s or t e ch n i qu e s c u l d

be com e a ai l abl e t h at c u l d t ran sform prospe ct s for t h e bu si n e ss

In general it is the dow nside risks that the management wi be most

c onc erned to identify.Whie one can nev er be sure that ev ery thing has be n

thought of, appr oaching the task b c onsid eration u der a n mber of

headings ma at least ensure that the obv ious is not ov erlo ked S ch

headings might be as folow s

inabi ty to sup ort gr owth.

Org niz at ion and cult ure:

•

is the management structure appropriate?

•

is the cultur e appr opriate?

I w il be app rent that the subje t of risk management is a wide one I

is ex amined in more d etai in anothe bo k in this series, IMS: Risk

Ma a ement f r Go d Go er na c

This bo k is intended to portra the kind of sy stem man al that might be

used in a busines that has, or plans to hav e, an integrated busines

management sy stem

Al busines es are diferent, and any sy stem manual that claims to be

c mmon to all w ould hav e to be so generalized as to be useles for any

practical purposes This bo k pr esents a form of man al that ofer a

fr amew ork c apable of inc rpor ating the difer ent elements of the sy stems

oper ated b the busines in a u iform w ay, and able to be extended to the

point w her e in d ue c ur e it c ould be ful y c mprehensiv e for that busines

I is b sed on the IMS f amewor k , whic h is repr oduc ed in Ap endix 1, and

w hich has be n the subjec t of earler bo ks in this ser ies

I is u lkely that ev er y d imension of a busines c an be inc or por ated

immed iately.In c er tain d imensions (fo ex ample, q ualty, health and safety,

and ac c ou ts), for mal systems ma alr ead y ex ist that c an be inc or por ated

r ead ily into the over al man al Othe ar eas ma not be the subjec t of for mal

sy stems and these w il have to be d ev eloped later.The objec tive is to pr od uc e

afr amew or k into w hic h ad d itional d imensions c an be r ead ily inc or por ated

At the same time, it w il ac t as a guid e to the for mulation of sy stems in

d imensions that hav e y et to be for maly ad d r es ed b the busines

Ev ery busines is difer ent f om ev ery other, and busines sy stems w il

also be u iq ue in some respe t to that or ganization How ev er, at the

oper ational lev el any busines sy stem can be regard ed as a seq uenc of

proc es es These ma be proc es es in a phy sical sense (in the case of a

factor y or a hospital , or a ser ies of a ministrativ e o c lerical proc es es (as

in a serv ic organization or a gov ernment d epar tment) Inputs wi be

ne ded for each pro es , as w il resourc s to car y out the pro es and

ac hiev e the r eq uired outputs Hav ing a sy stem that id entifies these

proc es es and the risk s (both positiv e and neg tiv e) asso iated w ith them

means that a c mprehensiv e picture of the ac tiv ities of the busines can be

buit up BS EN ISO 9 01:20 0 req uir es that a (q ualty ) sy stem manual

includes the sc pe of the sy stem (se the note on page 4 ), the do umented

proc edures esta lshed fo the sy stem (o referenc e to them) and a

description of the proc es es of the sy stem and their inter action

The man al is ac or dingly based on the folow ing approach:

•

Identify pr oc s es and map them to show their seq uenc and

inter action This is desc ribed in Cha ter 3

•

Identify the inputs, realization and outputs assoc iated with eac h

activ ity This should be re ord ed formaly in a standar d format,

although the details wi be diferent for d iferent ty pes of busines

and diferent d imensions within those organizations For ex ample,

those fo the acc ou ting fu ction w il be v ery diferent f om those for

apr oduc tion shop or a sales w arehouse

•

Ap ly a risk analy sis to eac h element of those pro es es in eac h

dimension of the sy stem (for ex ample, env ironmental or financ ial)

This is the cr ux of the sy stem The id entification of the risks

pertaining to each pro es can best be done b brainstorming ses ions

inv olv ing management f om outside the department d ir ectly

c onc erned, as wel as those w ithin, using a multi d isc iplnar y team

Whie the id entification of pro es es, inputs and outputs should be ma e

f e ly av aia le throughout the org nization, ther e ma be elements of r isk

as es ment that ne d to be kept c nfidential within the busines or ev en

w ithin a partic ular department This should be v ery selec tiv e The more

pe ple thinking about a par ticular risk the bet er, as they are more lkely

to find the best solution Any dec ision to maintain c onfidentiality on a

p rticular risk should be spe ificaly a prov ed b the chief ex ecutiv e

In clas ify ing risk s, the efe t of d uration should be re ognized A power

failure that c loses dow n a fac tory for an hour has les of an imp ct than one

that lasts w eeks; but fo a hospital or a fire serv ic e, a serv ic e failure of ev en

an hour may be intolerable

Ap l y th e pl an -d o-c h eck-ac t c yc l e i n proces i m pr ovem en t Con ti n u al

i m provem en t m ust be an objecti ve of th e bu si n es an d , at t he operat i on al

l evel , su ch i m provem en t m u st c om e fr om t he i m pr ovem en t of pr oc es es,

i n cl u d i n g el i mi n ati on Whi l e each pr oces at th e l owes l evel shou l d be

exam i n ed , t hi s i s n ot i n i tsel fsu ffi ci en t to en su r e opt i m i zat i on of the m ai n

proces At t hi s l evel , i t i s l i kel y t hat th e m ai n pr oc es es wi l l c u t acr os

t r ad i ti on al fu n cti on al r espon si bi l i ti es, so several m an ager s m ay n eed to wor k

t oget h er to achi eve a posi ti ve r esu l t

Although these pro edures w il apply to al operational ac tiv ities of any