ISO 9000 White Paper

"Increasing Profitability, Quality
and Compliance 
  with ISO 9000"


Barry K. Hall, CPA, Partner

Kruggel, Lawton & Company, LLC


Stephen H. Trexler, J.D.,
Senior Vice President

Roster Network, Inc.  


Introduction to ISO 9000  (Recommended viewing for both general business and industry and health care providers.)

ISO 9000 and Health Care (Recommended viewing for health care providers.)

The Roster Network ISO 9000 Facilitation Process  (Recommended viewing for both general business and industry and health care providers.)


Introduction to ISO 9000, a management tool for overall business excellence in your organization.

ISO 9000, a brief introduction to the basic concepts.

The term “ISO” is derived from the Greek word "isos", meaning equal.  ISO standards are developed and administered by the International Standards Organization, an international organization to which approximately one hundred countries belong.  The US representative is the American National Standards Institute.

The general purpose of ISO is to provide standards for the development, implementation and management of a quality management system.  ISO 9000 registration is best viewed as a management tool that reaches far beyond the province of "quality control" in a manufacturing environment, the application that first comes to mind to many business people.  For ISO 9000 purposes, the term "quality" should be viewed as being synonymous with "excellence" and as applying to all segments of a company's operations, even those administrative functions that are sometimes not viewed as being part of the overall goals of the company in meeting its customers needs. When used properly, ISO 9000 is a great management tool to promote excellence throughout all functions or all enterprises in all sectors of the economy, from manufacturing companies to service businesses to health care providers.

The innovation friendly ISO standards for systems and procedures documentation have received nearly universal acceptance in business and industry and is a virtual necessity for companies of all kinds doing business in or with European countries.  In recent years, adoption of ISO 9000 or the related automotive industry focused QS 9000 standards for documenting quality systems has become very wide spread in the US.

"Document what you do and do what you document," the essence of ISO 9000.

The essence of ISO 9000 is for a company to "document what it does and do what it documents."  The documentation is developed through the facilitation process and consists essentially of work instructions and quality and operational procedures designed to assure that goods and services are developed, created and delivered in a consistent manner that reflects the quality goals of the organization.

This built-in consistency not only promotes the interest of the customers of the organization (they get what they have been promised or expect), it promotes the efficiency and thus the profitability of the organization!  When properly facilitated and used, the documentation developed in the facilitation process and the ISO 9000 registration and audit process itself becomes a management tool to promote excellence throughout the business.

Some business executives have looked at ISO merely as a registration needed to do business.  Consequently, they take short cuts to achieve registration with "canned" documentation and using a registrar who focuses on whether the forms are filled out and not auditing the business' documentation to see if they really "document what they do and do what they document."  This is a very short sighted and ill-informed approach and can result in registrations that are essentially fraudulent; i.e., they misrepresent to their customers or others what is actually going on in the company.  

Just as financial audits of a company by its CPA serve to provide an independent third-party assurance as to the financial status of a company, audits of a company's quality systems and procedures serve to assure the customers that the company continues to implement the procedures and quality systems necessary to maintain the consistency of the company's products or services and that these procedures and systems are properly and timely documented."  

An essential feature of ISO 9000 is that it does not prescribe quality standards.  The registered companies are free to define the quality standards or "best practices" that are sufficient to meet the needs of their customers and market within which they operate.  All that ISO 9000 requires is that the applicable standards are documented in a certain way.  This innovation friendly aspect of ISO 9000 assures that companies are not locked in to stagnant, expensive and bureaucratic systems and procedures that may or may not meet the needs of their customers.

Preparation for Registration and the Facilitation Process

Companies that have knowledgeable and experienced internal staff members will prepare for the registration process on their own.  However, most companies work with an outside firm, such as a Roster Network Member to facilitate the preparation for registration.  The steps involved in preparation for registration are as follows.  Although the process may seem intimidating at first glance, it can be accomplished very efficiently if the facilitator (whether internal or external) takes his or her own advice and conducts the facilitation in a systematic and efficient manner.

The Audit Process

The registration audit or assessment is the essential step to evaluate the quality system documentation and whether it in fact reflects the reality of the workplace.

Assuring Continuous Improvement

The initial facilitation and registration processes are only the starting point for improving the excellence of the company's operations.  The Roster Network systems are ideally suited to promote continuous improvement throughout the organization.

Return to ISO 9000 Executive Summary contents.

ISO 9000 and Health Care, an efficient accreditation alternative that meets other essential needs.

While ISO is generally thought of in terms of the manufacturing segment of the economy, it is equally applicable to service firms, as we will illustrate with respect to health care.

Many hospitals, especially those in the UK, Australia, New Zealand and other Pacific Rim countries rely on ISO registration to document their quality systems and procedures.  ISO registration will provide a standard easily recognized and respected by business and industry leaders in the communities served by health care institutions adopting it.  This will provide added credibility to the institution to those persons and companies that are the ultimate source of health care funding for nearly all non-governmental insurance and self-funded benefit plans.

Institutions adopting ISO in lieu of Joint Commission on Accreditation of Healthcare Organizations ("JCAHO") need not fear loss of Medicare approved status as governmental regulations require either JCAHO accreditation or surveys by the Health Care Finance Administration ("HCFA") designated state agency, the avenue to approval relied upon by the 20% of hospitals not JCAHO accredited.

Additional Challenges for Health Care Providers

Approved payee status for federal health care programs is not the only challenge facing health care providers, however.  Additional issues confronting health care providers are as follows.  Providers should keep in mind that all of these issues are inter-related.  Problems in all of these areas have the same root causes.

Several Issues, One Solution

When facilitated with the proper systems and procedures and with the review of a dedicated registrar, ISO 9000 can become the tool for managing all of these issues.  Why?  The root cause of problems in all of these areas is the lack of systems and procedures that drive the organization to quality and continuous improvement.

Health care has historically relied upon intensive training of professionals and administrative staff and then punishing them when mistakes are made.  Problems with this approach are as follows.

As will be noted from the general discussion of ISO 9000, above, the whole thrust of the facilitation, registration and surveillance processes are to promote quality and excellence through defined, documented and communicated systems and procedures to reach the quality goals of the organization.  In the context of a health care provider, ISO standards would require a provider to have documented systems and procedures to address its needs with respect to:

The process shouldn't stop there, however.  Systems and procedures should be documented for all of the organization's activities, even those considered "administrative."  All of these activities will have either a direct or indirect impact on a provider's quality and profitability.  Examples are:

These are but a few examples of the systems and procedures that need to be defined, documented, communicated, enforced and continuously improved.  An additional review of how these issues inter-relate can be found in the Risk Management Techniques for Health Care page and the Risk Management Chart following it.

The documentation process for ISO 9000 registration is essentially the same as that used for Medicare-Medicaid compliance plan development and implementation.

Additional Benefits of ISO 9000 Registration for Health Care Providers.

In addition to the ability to improve quality and profitability as noted above, additional benefits of ISO 9000 as an alternative to JCAHO for health care providers are as follows:

Return to ISO 9000 Executive Summary contents.

The Roster Network ISO 9000 Facilitation Process, the most efficient and economical way to achieve registration and promote continuous improvement.

It is essential that facilitation for ISO 9000 meet the following criteria if the value of the process is to be maximized.

The Roster Network process of facilitation is uniquely suited to meet all of these needs.

Return to ISO 9000 Executive Summary contents.