Integrating Total Quality Environmental Management Systems – a Critical Study of TQEM
Relevance of TQM to Environmental Management
Scope of Dissertation
Moving from Reactive to Proactive Management
Understanding TQM in Relation to TQEM
History of TQM
Operation of TQM
Quality and Environmental Management Standards
Environmental Management Systems
Weaknesses of EMS Standards
Total Quality Environmental Management
Comparing ISO 9000 and ISO 14000
Integrating the ISO 14000 Environmental Management System
Impact of certification on economic and ecological performances
Research Design and Nature
Integrating a Sustainable EMS with TQM
Steps to Implementing an Effective TQEM Strategy
INTEGRATING QUALITY AND ENVIRONMENTAL ManagementS SYSTEMS – A CRITICAL STUDY
Background and Overview of Study
For decades economic growth has been considered the main indicator of a healthy society (Oliver, 1996). However, only recently has society begun to recognize the environmental cost of this growth. As a result, there is now an urgency to develop the means of satisfying present needs without compromising the ability of future generations to meet theirs. The implementation of sustainable management initiatives within organizations has largely been reactive, responding to environmental pressures, legal obligations, risk management, customer demands and competition. Some organizations have taken strategic advantages of such initiatives for commercial self-interest or to increase the stakeholders’ perception of the organization. These views will challenge the traditional outlook of organizations, as stakeholders interpret sustainable development through constraints of politics, economics, science, culture and religion.
All types of economic activity involve utilization of environmental or natural resources. Around the world, leaders have realized that production and consumption patterns have become unsustainable. Increasing awareness and growing public concern about the negative impacts on the environment and natural resource base has caused governments to reconsider existing strategies for growth and economic development. Most countries are now trying their best to balance the development and environmental needs based on the economic situation in their countries.
Prior to the 1950s, the common business response to environmental pollution was to ignore these types of problems. This was possible when the problems were smaller and the awareness of the health and environmental impacts was low. In the 1960s, a common approach to pollution was to assume “the solution to pollution is dilution” concept. Air pollutants were dispersed by tall smokestacks and water pollutants were discharged. However, these diluted pollutants accumulated in soil and water and eventually found polluted the food chain.
In 1970s, the government realized that pollutants had exceeded the capacity of the environment. There were efforts to establish environmental standards to regulate the discharge of pollutants. This resulted in the use of end-of-pipe (EOP) treatment systems. As the discharge standards became tighter, the cost of such of wastes became more expensive and affected the economic viability of many industries.
Besides the high costs, the was found to be ineffective. Pollutants were not eliminated, but simply transferred from one medium to another. The policy responses came in many forms, ranging from command-and-control regimes to voluntary systems emphasizing prevention of pollution at its source, waste minimization, cleaner production, and environmental management systems such as the ISO 14000 series. These voluntary systems were found to be more cost-effective and viable than using a command and control approach alone.
To survive in global marketplace that expanded in the 1990’s meant challenging and changing the way that business had been carried out since the beginning. What made it all the more difficult to see the need for change, was the success and profits that businesses had enjoyed in the past. A change management process was necessary. As a result, corporate social responsibility (CSR) was born.
CSR promotes a vision of business accountability to a wide range of stakeholders, besides shareholders and investors (IISD, 2002). The main areas of concern are environmental protection and the well-being of employees, the community and civil society in general, in both the present and the future.
The concept of CSR is based on the idea that corporations can no longer act as isolated economic entities operating apart from broader society. Traditional views about competitiveness, survival and profitability are being eliminated and unity is encouraged.
Some of the drivers pushing business towards CSR include the following (IISD, 2002):
The shrinking role of government: Traditionally, governments have relied on legislation and regulation to deliver social and environmental objectives in the business sector. Shrinking government resources, combined with a distrust of regulations, has caused the exploration of voluntary and non-regulatory initiatives.
Demands for greater disclosure: There is an increasing demand for corporate disclosure from stakeholders, including customers, suppliers, employees, communities, investors, and activist organizations.
Increased customer interest: There is evidence that the ethical conduct of companies exercises a growing influence on the purchasing decisions of customers. In a recent report by Environics International, more than one in five consumers reported having either rewarded or punished companies based on their perceived social performance.
Increasing investor pressure: Investors today are changing the way they assess companies’ performance, making decisions based on criteria that include ethical concerns. The Social Investment Forum reported that in 1999, there was more than $2 trillion worth of assets invested in portfolios that used screens linked to the environment and social responsibility in the U.S. A separate survey by Environics International demonstrated that more than a quarter of share-owning Americans took into account ethical considerations when buying and selling stocks.
Competitive labor markets: Employees today are looking beyond paychecks and benefits, favoring employers whose philosophies and operating practices match their own principles. In order to hire and retain skilled employees, companies are being forced to improve working conditions.
Supplier relations: As stakeholders become more and more interested in business affairs, many organizations are taking steps to ensure that their partners conduct business in a socially responsible manner. Some are introducing codes of conduct for their suppliers, to ensure that other companies’ policies or practices do not blemish their reputation.
Some of the positive outcomes that may arise when businesses adopt a policy of social responsibility include (IISD, 2002):
Company benefits, such as improved financial performance; lower operating costs; enhanced brand image and reputation; increased sales and customer loyalty; greater productivity and quality; more ability to attract and retain employees; reduced regulatory oversight; access to capital; workforce diversity; product safety; and decreased liability.
Benefits to the community and the general public, including charitable contributions; employee volunteer programs; corporate involvement in community education, employment and homelessness programs; and product safety and quality.
Environmental benefits, including greater material recyclables; better product durability and functionality; greater use of renewable resources; integration of environmental management tools into business plans, such as life-cycle assessment and costing, environmental management standards, and eco-labeling.
Despite these benefits, many companies continue to overlook CSR in the supply chain. For example, some companies still import and export timber that has been illegally harvested. While governments can impose embargos and penalties on offending companies, the organizations themselves benefit by making a commitment to sustainability by being more discerning in their choice of suppliers.
Today, the concept of corporate social responsibility focuses on the global business agenda. However, in order to move from theory to concrete action, many obstacles need to be conquered.
A key challenge facing business is the need for more reliable indicators of progress in the field of CSR, along with the distribution of CSR strategies. Implementing total quality environmental management programs can help businesses overcome many challenges and gain a more trustworthy reputation, while increasing the standards of other organizations at the same time.
Relevance of TQM to Environmental Management
One reason that TQM is perceived as relevant to environmental problems is a belief that it produces radical improvements in the performance of any activity it is applied to. However, there are also more specific connections between the objectives and practice of TQM and environmental management.
These are as follows:
TQM’s emphasis on the importance of customers and its broadening of the term beyond mere purchasers of a product provides a useful framework for considering and responding to the demands of environmental stakeholders;
TQM’s emphasis on commitment to continuous improvement is very helpful to organizations wishing to move beyond mere compliance with environmental regulation;
TQM’s focus on eliminating the root causes of problems rather than their symptoms fits with the growing awareness that pollution prevention is often a better approach to environmental problems than “bolting on” pollution control equipment;
TQM’s belief that quality is everyone’s responsibility within a company fits well with the growing awareness that all employees have to make a contribution to environmental performance;
TQM’s concern with calculating the cost of (non) quality provides a useful framework for considering the total costs and benefits of environmental action or inaction.
Statement of the Problem
Consciousness about environment friendliness has caused a lot of companies to change their business approach (Anthony, 2002). Adopting a pro-environment approach is a proven method to improve a company’s cost efficiency, quality, delivery and flexibility. This change is however posing a challenge in areas like production planning, inventory management and distribution, making operations management difficult.
Environmental management includes recycling and remanufacturing of parts and products (Anthony, 2002). Disassembly and recycling of reusable parts help the cause of environment protection, reduces the cost of usage of a fresh component, and avoids disposal costs. (MRP), an assembly-oriented scheduling system, does not support the process of disassembly. Uncertainty of quality, quantity and timing of recovery of reusable parts makes production planning difficult. To incorporate product recovery planning in MRP, use of reverse bill of material for every retrieved component or product is recommended. Concepts used in planning probabilistic demands for end items are used in structuring the bill of material.
Closed loop system is a widely used environment practice by many companies. This system requires new material only on non-receipt of recyclable material, thereby accounting for recovered as well as fresh goods in production planning. The problem comes when a recovered part is not usable because of some damage or requires some rework before reuse. At times recovered material from one product is used for a completely different product. Ford Motor Company uses recycled bumpers to make taillight housings. Similarly, GE plastics experimented by recycling used bumpers to make internal automotive components, plastic benches, building material and fuel for incinerators. This recycling affects capacity planning. New techniques need to be created to replace standard capacity planning techniques.
Environment Management is an important part of Total Quality Environmental Management (TQEM) (Anthony, 2002), which is comparable to Total Quality Management (TQM). Zero waste or zero emissions, reduction of hazardous inventory and leak prevention, some of the critical aspects of environment management are respectively analogous to zero defects, reduction in Inventory, preventive maintenance of TQM. Reducing and recycling packaging material also reduces waste.
Steps being taken by various companies for environment preservation affect their production and inventory control. Solutions to some of these problems have been found. However in certain areas a lot of work needs to be done.
Today, U.S. environmental regulations, alone, exceed 80,000 pages, and the costs of compliance continue to increase, as do the expectations of regulators and the public (Wever,). Companies can only get ahead of the curve by moving from reactive to proactive management, taking a quality-based approach that factors in the needs of consumers, the public, and the natural resource base. A well-conceived and executed total quality environmental management (TQEM) program not only results in reduced pollution and lower compliance costs, but also greater efficiency in production, improved worker safety, more responsibly designed products, and ultimately, a more satisfied public.
International Environmental Management System (EMS) standards are quickly becoming a key ingredient in strategic business planning. Today’s most successful global organizations have integrated the EMS structure within their business management systems. The implementation of an EMS into business operations has many benefits for businesses. It increases internal efficiency, expands communication with external parties, and reduces management risk. Global corporate responsibility starts with environmental and social accountability, which is continuing to have a greater impact on business decisions. Senior managers in global organizations have reduced management risk by integrating an effective EMS into the organization’s business system.
The EMS is a key aspect of competing in the existing global market. Ford, GM, Toyota, Xerox, Philips Electronics, BMW, Owens Corning, and many other global companies have registered to ISO 14001, and are urging, and in some cases requiring their suppliers to implement an EMS. Employees from senior management to store personnel have been trained to understand their job’s impact has on business operations, in relation to environmental responsibility of the company.
The International Organization for Standardization (ISO) began development of international management system standards in 1987 with the ISO 9000 quality management system standard series. In 1996, the ISO 14001 EMS standard was published. As international management standards continue to be developed, organizations will stress management systems integration, to improve business efficiency.
As one of the two ISO published international management system standards the ISO 14001 EMS has become the foundation of management systems integration, as it affects all aspects of business decision-making. Unlike the ISO 9000 quality management standard, which applies to manufacturers and product quality, the ISO 14001 standard addresses not only product quality, but also environmental and social impact. ISO 14001 assist managers in analyzing the management risk involved within the total business system through review of all the company’s activities, products and services.
Scope of Dissertation
Businesses today expect improved performance from their environmental department just as they would expect improvement in their manufacturing processes (Dufresne, 2000). Many organizations are beginning to think beyond environmental compliance towards environmental performance. A well-designed Environmental Management System (EMS) can have a profound impact on both the immediate bottom line and the long-term financial health of a company. An EMS that has been certified to the internationally recognized International Organization of Standards (ISO) 14001 Standard is considered the state-of-the-art in environmental management.
In a poll conducted by the ISO 14000 Information Center in 1999, over 130 respondents stated that the ability to streamline their environmental management efforts was the single greatest motivating factor for implementing an EMS. Before this poll, experts beloved that customer pressure was the leading factor. It turns out that dollars saved by implementation of an EMS add to the market advantage ISO affords, according to experts at IBM, Ford Motor Company (Ford) and Analog Devices, Inc. These businesses have realized not only the environmental efficiency that can be gained by such a program but also the favorable public relations image being “green” brings. This image separates these companies from their competitors.
In order to be successful, an environmental program must include a commitment to continual improvement of the EMS. One of the most prevalent management philosophies permeating business over the past fifteen years has been the concept of Total Quality Management (TQM). Continuous improvement is one of three basic principles associated with TQM, as is the participation of everyone within the organization and a focus on the customer. Basically, this concept assumes that every process used to operate a business can be continuously improved.
In order to move beyond compliance, the ISO standard requires that an organization examine all aspects of its operation that it can control and their impact on the environment. This involves integrating its QMS policies with EMS. EMS must be included in the manufacturing processes of an organization, the supporting functions, manufactured products, or the services they provide. Typically, most companies have experience dealing with the direct impact of manufacturing operations on the environment. Compliance issues often deal with the air, water or waste discharges from these operations. These are areas that have traditionally been regulated by Federal, state and local government for the past four decades. Most activities that surround a business have some impact on the environment, from employees commuting to work to the landscaping of the property.
II. LITERATURE REVIEW
Moving from Reactive to Proactive Management
The term environmental management is best defined by the United Nations Environmental Program, as “the control of all human activities which have a significant impact on the environment (Barnes, 1997).” The environment, as defined by the International Organization for Standardization (ISO), is the “surroundings in which an organization operates, includes air, water, land, natural resources, flora, fauna, humans, and their interrelation (Barnes, 1997).” From these two definitions, one can conclude that “it is the responsibility of the organization’s managers to plan the organization’s activities, products, and services in a manner that reduces the organization’s detrimental impact on the environment, increases the organization’s benefits to the environment, while at the same time increasing the organization’s ability to achieve profit maximization.”
However, the problem with existing strategies of environmental management in most organizations is that managers focus only on achieving regulatory compliance, using a regulatory management system (RMS), rather than developing a method of exceeding compliance requirements and integrating environmental responsibilities into business planning using an environmental management system (EMS).
must see their organizations as a system, with departments and personnel collaborating to achieve total quality environmental management through integrating business thinking with environmental planning (Barnes, 1997). Management systems, including financial and environmental performance, are the key ingredients in developing successful business strategy, and optimizing the organization efficiency through management systems integration. An EMS employs information from other management systems within the organization to increase operational efficiency and control environmental impact. Environmental management system standards are becoming essential in today’s highly competitive global market.
The environmental management system in the U.S. has enjoyed dramatic environmental progress, making this nation’s environment the cleanest in the world for the population and quality of life it serves (Kingsbauer, 2003). Since 1991, most major industrial sectors have reached compliance with existing regulations, while creating cost pressures on many of the industry’s customers. In the following years, few new environmental legislative programs have been created, and fewer new regulations have been developed. The environmental management industry in the U.S. has been one whose growth has been, largely, a reaction to government regulations.
With the erosion of regulation-induced demand, buying patterns for environmental products and services are experiencing a fundamental change, which is characterized by a shift away from demand for pollution control, waste management, and remediation products and services to one based on the goal of increasing resource productivity and environmental improvements that improve competitive advantage. As these changes continue to gain momentum, the environmental market is shifting from activities designed to correct mistakes of the past and toward one dominated by preparations for the future.
The nature of the demand for environmental products and services is evolving rapidly in all sectors of the global market (Kingsbauer, 2003). Industry leaders feel that these changes are caused by the combined impact of the environmental regulatory system and changes in customer expectations. These factors have failed to produce a system that can survive, for the long-term, outside of the regulatory stimulus-based marketplace that is currently in place. In addition, due to the nature of the U.S. environmental market, few U.S. environmental management companies are prepared for international competition, where a significantly different set of factors form customer demand and expectations.
A variety of approaches to environmental management are now visible among public and private sector customers (Kingsbauer, 2003). These approaches involve, to various degrees, corporate strategies to environmental decision making, including locating the environmental decision makers in the corporate structure, the inclusion of processes, and the analysis of decision factors. All of these approaches are rooted in the performance measures set by the EPA, state, and local environmental agencies. These performance standards have traditionally provided the primary motivation to companies to make expenditures that benefit the environment. Industry started with a “traditional” compliance orientated approach to buying environmental services and products, and is now moving towards a more “advanced” approach that integrates both environmental and business decision making.
The traditional organizations respond to government imposed environmental regulations. This group typically chooses end-of-pipe solutions that treat pollution after it has already formed, rather than avoiding waste from the get-go. Basically, they manage for environmental compliance. Some smaller industries actually remain out of compliance.
This method of management is no longer acceptable. To remain competitive, traditional businesses must now expand their approach beyond questions of compliance with regulations. They must start process of making decisions that optimize economic and environmental decisions, or simultaneously consider economic and environmental factors. These organizations have a broad range of options, including those that reduce waste and the generation of pollution. Advanced leaders have made significant shifts in their organizations that expand the factors and participants in decision making. They integrate environmental factors in their decisions more often and fully than other firms, adopting advanced production processes and product designs that are both economically and environmentally advantageous. These companies regard productivity and technology as essential drivers of manufacturing strategy, invest more in process and product research, and make greater use of quality-based strategies. In addition, these companies realize the benefits of a positive environmental perception in the marketplace.
The increasing number of businesses using the advanced approach to environmental management is leading the change in demand for environmental products and services. Demand is increasing, for example, for new products and services that improve the efficiency of production processes and reduce pollution. More and more businesses are seeking environmental services that are multi-media in nature, meaning they are integrated into the production and management processes. Companies are telling their environmental product and service providers that their future competitiveness is contingent upon their continued improvement in environmental management. They are questioning the benefits of their investments in relation to an increase in environmental performance.
According to Kingsbauer, (2003): “To stimulate consistent demand for environmental products and services, and to create incentives for continuous environmental improvement in industry, industry leaders, academics, and policymakers believe economic policies must be implemented that value the environment in national and international commercial systems. The internalization of wasted resources, pollution, and environmental degradation into society wide accounting and, therefore, into everyday business calculations will enable the free market to accurately reward environmental excellence and punish environmental wrongdoing.
Industry leaders recommend that this reform be implemented through a greater use of market-based instruments. These tools would effect incremental economic consequences for each increase in environmental degradation, and reward each increment of improvement. While these issues represent the framework for both a more competitive and more sustainable economy, and for the future competitiveness of the environmental industry, these changes remain in the future in terms of business tactics for environmental companies. The essence of business strategy is long-term vision, and many business leaders believe they must be devoted to the vision of creating a sustainable economic policy for their companies and for the collective environmental industry.”
Since the early 1990s, numerous industry-led initiatives have promoted environmental auditing as central to completing their mission (Kingsbauer, 2003). Originally referred to as the “Valdez Principles,” these concepts were promoted as a means to avoid environmental disasters. Later, these business practices, primarily founded in the continual auditing of environmental procedures, became known as Total Quality Environmental Management (TQEM). The EPA, as part of a regulatory reform initiative, responded in the spring of 1995 with a new environmental auditing policy, updating its policy from 1986. The new policy provided significant new incentives to conduct voluntary self-audits. This new policy reduces penalties for violations that companies voluntarily reveal. Self-auditing is used as a baseline measurement in TQEM, as well as for a gauge to determine the effectiveness of improvements already made. PriceWaterhouseCoopers conducted a survey in March of 1995 that showed three out of four companies with over $1-billion in sales and over 10,000 employees had environmental auditing programs in place. Of the surveyed companies that did not have auditing programs in place, one third of them planned to implement a program. According to Kingsbauer (2003): “Environmental auditing is no longer an afterthought, but an essential element in any comprehensive approach to environmental management.” corporate culture that once viewed environmental functions as nonproductive liabilities is experiencing a new generation of environmental managers (Kingsbauer, 2003). They are thinking beyond compliance and remediation activities and redefining their business’ environmental policies to reach business objectives. This new breed of environmental managers is focused on TQEM programs that impact company profits, competitive advantage, public image, and shareholder values. When environmental programs are driven by government compliance requirements, the role of the environmental manager is changed, leaving little room for innovation. When environmental programs are bound by key business drivers, as opposed to environmental legislation, the environmental function becomes an integral part of an organization’s business goals. Examples of key business drivers include increasing global competitiveness and public awareness of a company’s environmental policy. Environmental programs that are not tied to business drivers are hard to maintain over a long period of time. When decision making is based on responding to regulations, rather than a conscious plan based on financial decisions, the improvements tend to diminish in importance in the long run.
New generation environmental managers understand that environmental issues are business issues. Environmental issues can no longer be viewed as a distinct function, separate and apart from business operations. Instead, environmental policy has to be merged into manufacturing and distribution, with “best practices” functioning as the glue holding the parts together. Environmental managers are reaching beyond compliance requirements and taking innovative measures to improve every aspect of an organization’s operations and achieve business goals. Environmental managers who want to achieve these results have a variety of key issues facing them:
How to integrate environmental excellence into all business functions and processes.
How to align environmental initiatives with business efforts to control costs.
How to help the company do more with less, enhancing resource yields and efficiencies.
How to create strategic opportunities for the company and mitigate risk.
Today’s environmental managers view the above process as a gradual disengagement from the previous strategy of regulation-based environmental policies. The goal is to routinely operate at such a high level of excellence that regulatory standards and oversight become a side issue. Regulatory compliance becomes a starting point to a higher level of performance.
Understanding TQM in Relation to TQEM
Total Quality Management (TQM) is often seen as a way to cut waste. The world is now starting to understand that waste lives not only in defects, but also in pollution, so “Total Quality” must mean an ultimate goal of zero pollution (whether for an individual firm, or for a group of companies in an industrial ecosystem) (Friend, 1993).
In a nutshell, Total Quality Management (TQM) is a management style that is based upon producing quality service as defined by the customer (Ishikawa, 1985). TQM is basically a quality-centered, consumer-focused, information-based, team-driven, senior-management-led process to achieve an organization’s strategic imperative through continuous process improvement. TQM principles are also known as total quality improvement, optimal quality, continuous quality improvement, total service quality, and total quality leadership.
The word “total” in Total Quality Management means that all members of an organization must be involved in the continuous improvement effort, the word “quality” focuses on customer satisfaction, and the word “management” refers to the people and processes that work to achieve the quality (Ishikawa, 1985).
Total Quality Management is more than a program; rather, it is a systematic, integrated, and organizational style directed at the continuous improvement of an organization. It is a proven management style used successfully for decades in organizations worldwide. TQM is not an end in itself; it is a means to an organizational end. TQM must not be the primary focus of an organization; it should merely be the means to achieve organizational goals.
History of TQM
Understanding the history of TQM is helpful in understanding its techniques (Wever, 1996). TQM was developed in the mid-1940s by Edward Deming, an advisor in sampling at the Bureau of Census and professor of statistics at the New York University Graduate School of Business Administration. Dening found it hard to convince American businesses to adopt TQM at first but his management methods were successful in Japan.
After World War II, General MacArthur took 200 scientists and specialists, including Deming, to Japan to help rebuild the country. While working on the Japanese census, Deming was invited by the Japanese Union of Scientists and Engineers to give lectures on his statistical quality techniques. A professor to many of Japan’s CEOs believed in Dening’s concept and urged his CEO students to use Dening’s techniques to turn Japan’s economy around in five years. Dening focused on achieving quality at a reduced cost. Many of the CEOs took the professor’s advice and attended the lectures. Eventually, many Japanese manufacturing companies assumed Deming’s theories and were able to produce quality products at reduced costs.
While the Japanese business world focused on producing quality products, businesses in the United States were more concerned with producing massive quantities of products, paying little attention to quality. The American emphasis on quantity at the expense of quality enabled the Japanese, with their inexpensive, high-quality products, to gain a substantial foothold in American markets.
In the 1970s and 1980s, many U.S. companies, including Ford, IBM, and Xerox, adopted Deming’s principles of TQM. As a result, U.S. companies were able to regain some of the markets previously lost to the Japanese. Although TQM gained its prominence in the private sector, it was soon adopted by public organizations, as well.
Operation of TQM
TQM operation is best explained by examining Dr. Deming’s universal fourteen points of quality management.
Universal Fourteen Points
The universal fourteen points for quality management are the foundation of TQM and guide the entire TQM process. These points are as follows (Cohen, 1998):
1.”Create constancy of purpose towards improvement.” Replace short-term reaction with long-term planning.
2.”Adopt the new philosophy.” The implication is that management should actually adopt his philosophy, rather than merely expect the workforce to do so.
3.”Cease dependence on inspection.” If variation is reduced, there is no need to inspect manufactured items for defects, because there won’t be any.
4.”Move towards a single supplier for any one item.” Multiple suppliers mean variation between feedstocks.
5.”Improve constantly and forever.” Constantly strive to reduce variation.
6.”Institute training on the job.” If people are inadequately trained, they will not all work the same way, and this will introduce variation.
7.”Institute leadership.” Deming makes a distinction between leadership and mere supervision. The latter is quota- and target-based.
8.”Drive out fear.” Deming sees management by fear as counter- productive in the long-term, because it prevents workers from acting in the organisation’s best interests.
9.”Break down barriers between departments.” Another idea central to TQM is the concept of the ‘internal customer’, that each department serves not the management, but the other departments that use its outputs.
10.”Eliminate slogans.” Another central TQM idea is that it’s not people who make most mistakes – it’s the process they are working within. Harassing the workforce without improving the processes they use is counter-productive.
11.”Eliminate management by objectives.” Deming saw production targets as encouraging the delivery of poor-quality goods.
12.”Remove barriers to pride of workmanship.” Many of the other problems outlined reduce worker satisfaction.
13.”Institute education and self-improvement.”
14.”The transformation is everyone’s job.”
These fourteen points form the foundation of Total Quality Management.
The United States is leading in a related innovation, Total Quality Environmental Management, that applies the practical wisdom of TQM to environmental management systems and to the increasing challenge of bringing total quality to the environmental aspects of economic life. In TQEM, four key streams — “ecology, cybernetics. Respect and profitability — “collaborate.
Ecology holds that industrial systems must include the principles of rich interconnection, resilience and tight, rapid feedback that we find in natural systems, which are the successful result of billions of years of research and development (R&D) in competition and efficiency. In cybernetics, the law of requisite variety proves what every good manager already knows: you cannot know enough to manage everything yourself, you must empower and equip your front line.
TQM, which is often seen as an management/engineering system, is actually based on respect for the creativity and maturity of every employee, valuing human capability (both cultural and technical) and encouraging creative participation at every level of business. According to management consultant Stewart Sagar (Friend, 1993), “In the information age, its all the more important to understand that the real resources are not the machines, but the minds.”
Finally, the quest for profitability requires a fierce commitment to customer satisfaction and continuous quality improvement for any type of defect, from poor performance to environmental pollution. Today’s global economy requires this type of commitment, and the ability to deliver on it.
The Classic TQM Cycle works in conjunction with TQEM (Friend, 1993):
Step One, Plan. Understand the gaps between present state and desired state, set priorities, and develop an action plan.
Step Two, Do. Implement the changes, and collect data on actual results.
Step Three, Check. Observe the effects, analyze the data, pinpoint problems.
Step Four, Act. Study the results, redesign systems, change standards, communicate broadly and retrain. And repeat the cycle continually.
The Global Environmental Management Initiative, a collaboration of several dozen major U.S. firms, identifies four additional TQEM elements (Friend, 1993):
Identify the customer – both external and internal. Motorola, a pacesetter in quality systems, trains its people to recognize customers in all interactions, and to satisfy them completely.
Commit to continuous improvement: No matter how good a company is, it can always do better; yesterday’s “impossible” may become tomorrow’s standard, particularly in the fast world of environmental quality.
Do the job right the first time: The cost of quality is the cost that quality failures impose on a company.
Take a systems approach to work. Deming observes that “apparent differences between people arise almost entirely from the action of the system that they work in, not from the people themselves.”
TQM provides a critical part of the framework for what Stafford Beer labels “autonomy in a coherent whole” (business goals and feedback systems clear enough that business units and personnel have the flexibility to meet those goals, without the cumbersome command and control structures of the past) (Friend, 1993). A well designed and implemented TQEM system can transform information into action.
Since the early 1980s, photocopier manufacturer Xerox has continuously strived to improve its corporate environmental performance (IISD, 2002). Xerox’s environmental commitment was reinforced by its “Leadership through Quality” program, which was developed to implement total quality management (TQM). The combination of environmental and quality initiatives has resulted in an environmental program that represents the application of Total Quality Environmental Management (TQEM) principles.
In 1990 the Xerox ‘Environmental Leadership’ program was approved and communicated to all managers and employees by Paul Allaire, the CEO of Xerox, demonstrating the high level of management commitment to environmental protection (IISD, 2002). The emphasis of the program was on proactive environmental protection measures, and employee involvement was a key aspect of the implementation of new environmental initiatives.
At Xerox, the TQEM goal of continuous improvement will stay firmly intact until the elimination of pollution and waste. Zero Defects, Zero Disposal and Zero Pollution are the three major goals toward which Xerox aims for in its plan for sustainability.
Quality and Environmental Management Standards
Standards make a major contribution to most aspects of our lives – although very often, that contribution is not easily seen (Rosas, 2002). However, when there is an absence of standard, it is easy to see the importance of standards. For example, as consumers, individuals tend to notice when they turn out to be of poor quality, do not fit, are incompatible with equipment they already have, or are unreliable or dangerous. When products meet consumer expectations, this is taken for granted. People are usually unaware of the role played by standards in increasing levels of quality, safety, reliability, efficiency and interchangeability, as well as in providing these benefits at an economical cost.
International Organization for Standardization (ISO) is the world’s largest developer of standards. While ISO’s main activity is the development of technical standards, ISO standards also have important economic and social effects. ISO standards make a positive difference, not just to engineers and manufacturers for whom they solve basic problems in production and distribution, but to society in general.
One of the most increasingly popular decisions made by organizations around the world today as they deal with the challenge of avoiding the costs of environmental incidents and regulatory compliance activities is to streamline their environmental and quality programs (Chinn, 2001). Traditionally, quality conscious CEOs have applied total quality management (TQM) principles to prevent quality problems and improve profitability. Today, many organizations are realizing the financial benefits of improved environmental performance in conjunction with their business processes.
In 2000, at least one-third of certifications performed worldwide by ISO registrars were of integrated quality and environmental management systems. This volume of integrated system certifications is continuing to increase, mainly because the new ISO standards incorporate the TQM-based business model.
Early ISO implementers discovered that they are more able to control the costs of quality nonconformity and environmental noncompliance by leveraging the ISO 9001 and ISO 14001 elements under one, integrated management system category. Potential cost savings can result from: more efficient use of resources, eliminating duplicate functions in quality and environmental management systems, reducing the number of audits, and improving environmental performance. If two systems can be integrated within a short time span, there are additional competitive advantages from meeting windows of opportunity.
The international standards developed by ISO are useful to industrial and business organizations of all types, to governments and other regulatory bodies, to trade officials, to conformity assessment professionals, to suppliers and customers of products and services in both public and private sectors, and, ultimately, to the general public in their roles as consumers and end users.
According to a recent ISO publication (Rosas, 2002), “ISO standards contribute to making the development, manufacturing and supply of products and services more efficient, safer and cleaner. They make trade between countries easier and fairer. They provide governments with a technical base for health, safety and environmental legislation. They aid in transferring technology to developing countries. ISO standards also serve to safeguard consumers, and users in general, of products and services – as well as to make their lives simpler. When things go well – for example, when systems, machinery and devices work well and safely – then often it is because they conform to standards. And the organization responsible for many thousands of the standards which benefit society worldwide is ISO. ”
ISO 19011:2002, Guidelines for quality and/or environmental management systems auditing, has replaced six older standards in the ISO 9000 (quality) and ISO 14000 (environment) families (Rosas, 2002). Using these guidelines gives organizations a more integrated and balanced view of their operations, making it an essential tool for continuous improvement towards business excellence. These standards help user organizations optimize their management systems, facilitate the integration of quality and environmental management, and, in allowing single audits of both systems, save money and decrease disruption of business units being audited.
Both the ISO 9000 and ISO 14000 families of International Standards emphasize the importance of audits as a management tool for monitoring and verifying the effective implementation of an organization’s policy for quality and environmental management. Audits are also an important part of activities such as external certification and registration, and of supply chain evaluation and surveillance.
ISO 19011 gives guidance on the conduct of internal or external quality and environmental management system audits, as well as on the management of audit programs. Users of this standard include auditors, organizations implementing quality and environmental management systems, and organizations involved in auditor certification or training, certification and registration of management systems, and accreditation or standardization in the area of conformity assessment.
ISO 19011 was created by a joint working group (JWG), set up by two subcommittees of the ISO technical committees ISO/TC 176, Quality management and quality assurance, and ISO/TC 207, Environmental management.
The new guidelines provide a basic approach for the auditing of environmental (EMS) and quality management systems (QMS) (Rosas, 2002). As many organizations apply both EMS and QMS – either as separate systems, or as an integrated management system – they want to complement and, where possible, combine the auditing of these systems.
When it comes to external audits, ISO 19011 also provides certification/registration bodies with a uniform approach and facilitates the combined external assessment of management systems. ISO 19011 promotes better harmonization of practices in the quality and environmental management market.
ISO 19011 replaced ISO 10011-1, ISO 10011-2 and ISO 10011-3 in the ISO 9000 family and ISO 14010, ISO 14011 and ISO 14012 in the ISO 14000 family (Rosas, 2002). It has completed the ISO 9000 “core series,” also comprising the revised ISO 9000, ISO 9001 and ISO 9004, published in December 2000.
Environmental Management Systems
The intent of an EMS is to enable any organization to voluntarily implement an effective management system for both sound environmental performance and to participate in environmental auditing schemes. The design principle is not so much a regulatory device as a management tool, with the objective of improving an organization’s environmental performance. Pressures from external parties, may result in a requirement similar to the developments of ISO 9000 and could overshadow the flexibility of the design principles. If so, organizations in the near future may need some form of environmental management certification to compete in the marketplace.
Organizations that have ISO 9000 experience have a competitive advantage in implementing an EMS due to a greater understanding of the management system requirements, continuous improvement and quality principles (see Figure 1).
The relationships of Quality and Environmental Management Systems.
Four main areas integrate environmental protection into the management system These are developed after considering the direct and indirect effects organizational processes and products have on the environment. It is essential that the areas and elements relate to the achievement of organizational goals. The organization must determine objectively how can they reduce environmental impact, as well as improve the quality of their processes and products. Only then is an organization able to formulate and implement the elements of an environmental management system.
Weaknesses of EMS Standards
One of the main weakness of EMS standards is that they do not establish absolute requirements for environmental performance beyond compliance with self-determined limits and a commitment to constant improvement (Chinn, 2001). The minimum level should be, ethically, to comply with current environmental regulations within its zone of operation and within the market place. The extent of application of the elements depends on the organization’s interpretation of social responsibility as reflected in its environmental and management policies.
Because EMS standards are management tools for self-governance, they provide only a simple foundation structure. An outcome is that organizations are not required to drastically change management structure, appraisal systems, techniques or culture for the implementation of an EMS, even though doing so is probably the best idea.
This weakness can, as demonstrated by some ISO 9000 implementations, lead to a systems adherence with little measurable impact on the business or environmental outcome. As with any quality initiative, the success of an EMS depends greatly upon the commitment from all levels of an organization and needs top management involvement. If the organizational structure and culture are not properly addressed, failure can occur to sustainable management initiatives.
Total Quality Environmental Management
The Total Quality Environmental Management (TQEM) philosophy takes the concept of Total Quality Management (TQM) a step further, moving the focus to meeting or exceeding consumer expectations (Chinn, 2001). TQEM identifies and includes in its customer definition society in general. The main focus of TQEM is achieving effective sustainable management of resources by making it into a learning organization. The TQEM approach differs from a system approach as it changes an organization’s focus from complying to statutory regulations or stakeholders’ views to a proactive culture of managing resources for society as a whole. Thus, it takes a holistic view of the environment that also includes people, social and community aspects to ensure that the organization meets or exceeds society’s needs in relationship to the environment.
The ISO 9000 series of Quality Management standards, with over 70,000 registrations around the world, is used by organizations as a model for a quality management system (Fredericks, 1995). In recent years, the ISO 14000 series of standards, the model for an environmental management system, has arrived on the scene.
Environmental management enables an organization to stay aware of the interactions that its products and activities have with the environment and to achieve and continually improve the desired level of environmental performance.
ISO 9000 aims to meet customer requirements, control of the process and continuous improvement. ISO 14000 is aimed at these, and more: “customer requirements” has expanded to include regulatory and other mandatory environmental requirements; and “continuous improvement” is not only driven by customer expectations but also by priorities and objectives generated internally by the organization.
ISO 14000 Environmental Management System Model
The ISO 14000 series of standards is comprised of several guideline standards and one compliance standard — ISO 14001 Environmental Management Systems (Fredericks, 1995). The ISO 14000 series is modeled after the BS 7750 (Environmental Management Systems) originally published in 1992 and updated in 1994. The BS 7750 standard has been the subject of a pilot implementation program involving nearly 500 participants from various industries.
Comparing ISO 9000 and ISO 14000
ISO 14000 does not replace ISO 9000. A company with an ISO 9000 registration has a sound foundation for ISO 14000 and both are part of an organization’s general management system (Fredericks, 1995). ISO 14000 also does not replace regulations, legislation and codes of practice that an organization must comply with. Instead, it provides a system for monitoring, controlling and improving performance regarding those requirements.
ISO 14000 is the package that ties the mandatory requirements into a management system that is made up of objectives and targets focusing on meeting and exceeding the minimum requirements with a focus on prevention and continuous improvements.
ISO 14001 uses the same basic systems as ISO 9000, such as documentation control, management system auditing, operational control, control of records, management policies, audits, training, statistical techniques, and corrective and preventive action.
There are also some major differences. Besides the similarities, ISO 14001 has clear statements about communication, competence and economics than are now found in ISO 9000. Also, ISO 14001 incorporates the setting of objectives and quantified targets, emergency preparedness, considering the view of interested parties and public disclosure of the environmental policy.
A company with an ISO 9000 registration may find that they are quite a way towards an ISO 14001 registration from the outset (Fredericks, 1995). Even though there are differences, the management system is typically consistent in both the standards. The ISO approach to management serves as a “model” that needs to be adapted to meet the needs of the organization and integrated into existing management systems. The standards have been designed to be applied by any company in any country regardless of the organization’s size, process, economic situation and regulatory requirements.
Relationship between Management Systems
Integrating the ISO 14000 Environmental Management System
The Environmental Management System must be integrated with the organization’s other activities (Fredericks, 1995). If it is seen as a separate program, it will be hard to maintain. The objectives, targets, procedures and systems must be part of routine operations related to the genera; activities of the organization.
ISO 14000 is not an add-on program. It is not about “environmentalism” or being “green (Fredericks, 1995).” An effective EMS is a consistent and systematic control of procedures or operations, products or services which can have a significant impact on the environment. It is concerned with environmental performance, but also what it is about is effective corporate management.
An organization that has effectively integrated an ISO 14001 Environmental Management System with its other business management systems is working towards managing its processes with a view towards compliance, consistency and continuous improvement, and can accrue the benefits.
The societal dimensions of TQEM.
TQEM evaluates the environments’ distress is communicated through representation by society (Chinn, 2001). This is reflected in:
the development of statutory regulations, green pressure organizations, stakeholders and consumers evaluating organizations.
Organizations are coming to the realization that, as they are building strong relationships with society’s representatives, they are indirectly adding to value of the organization by reducing compliance costs and increasing competitiveness.
These evaluations are not limited to a narrow-minded view of the organization’s performance in the singular environment, but other factors, such as human resource policies and community service activities. As a result, the organization’s culture needs consideration to achieve the higher societal dimension, as well as economic performance for sustainable management. TQEM promotes the need for commitment to continuous improvement and investment in all dimensions for sustainability rather than compliance’s to reactive systems or intended regulations. The organization must objectively view itself as an existential community of planned inputs and outputs to fulfill itself and its social responsibilities. The outputs are intended products and services and unintended products and services are waste or lost resources. Such wastes or lost resources, reported to be up to 94% are the result of process deficiencies. Through continuous improvements such process deficiencies are minimized with the ultimate goal of sustainability.
III. RESEARCH METHODOLOGY
The ability of companies to manage their environmental performance is emerging as a strategic issue, worldwide. This is primarily because the environment is now regarded as an important and highly valuable asset. Consequently, managers, today, are not only expected to decrease lead times, improve quality, reduce costs and enhance flexibility, they are also expected to become more environmentally responsible (Montabon et al., 2000). In response to the increasing need for companies to address the impact of enterprises’ activities on the environment, the International Organization for Standardization has created the ISO 14000 series of standards. The standards provide a supplement to preexisting environmental regulations (Murray, 1999) and aim to help companies integrate environmental considerations into corporate decision making in a more organized manner (Gale, 1996). The ISO 14000 standards deal with many matters concerning the environment, and the standard that primarily focuses on environmental management systems (EMS) is ISO 14001.
While there has been an increase in the number of studies investigating corporate environmental reporting (e.g. Guthrie and Parker, 1990; Deegan and Gordon, 1997), research on the combined impact of ISO 14001 and ISO9001 on a company’s economic and environmental performances is lacking. It is thus the objective of this study to address this issue by examining corporate and environmental performance and other related issues of ISO 14001 and ISO9001 certified companies in the United States. Besides enhancing literature in the area of environmental management, it is hoped that the results of this study will assist other companies to embark on certification.
Through a survey of ISO 14001 and ISO 9001 certified companies, the study mainly attempts to answer the following research questions:
What is the impact of ISO 14001 certification on the company’s environmental performance?
What is the impact of ISO 14001 certification on the company’s economic performance?, and What are the factors influencing companies to seek certification?
The paper proceeds in the following manner. The prior section is a review of literature on TQM, EMS, QMS and TQEM, followed by a discussion of existing research examining the impact of these methods on corporate performances in developed countries. Section 3 describes the research methodology while section 4 discusses the findings. Section 5 concludes.
As the number of certified sites in the United States is large, the choice of method has to be one that allows a random number of the ISO 14001 and I9001 certified sites to be surveyed. Since all the certified sites are located all over the U.S., a mail survey seems to be the best method. The use of postal questionnaire survey as a method of data collection has been very popular with researchers as it provides numerous advantages. A survey enables the collection of a sufficiently large and representative sample for analysis. Besides being simple, the postal questionnaire survey method is cost effective and enables respondents to preserve their anonymity. Therefore, this would make respondents feel more comfortable when answering the questionnaire.
The questionnaire comprises two parts. Part 1 focuses on the research questions of interest while Part 2 is on the demographics. Questionnaires were sent to 130 ISO 14001 and I9001 certified sites in March 2004. The letter accompanying the questionnaire stated that the questionnaire should be answered by the party most responsible for environmental management at the site. 58 sites responded to the survey.
Table I provides the profile of respondents. The respondents represented a variety of positions and functions including, environmental managers, environmental engineers, TQM managers, QCC managers, safety and health officers, safety and training managers, environmental, safety and health (ESH) managers and superintendents of sites.
Profile of Respondents
Manufacture and electrical goods/semiconductors
Designation of respondents
Health, Safety and Environmental (HSE) Managers
Human Resource Managers
No of employees
5000 and above Total large majority (64%) of the respondents are involved in the manufacturing of semiconductors and electrical goods.
Impact of certification on economic and ecological performances
On a scale of ‘1’ (least impact) to ‘5’ (most impact), respondents were asked to rate the impact of ISO certification on various performance measures such as whether or not ISO certification:
a) results in company exploring alternative technologies, b) enhances the reputation of the company, significantly reduces waste in its production process, d) places reasonable demands on the information system and data requirements, e) improves company’s chances of penetrating the international market, f) helps company design better products, g) improves company’s competitive edge, h) significantly reduces overall costs, i) improves the quality of product, and lastly, j) significantly reduces lead times.
Although these factors are neither quantifiable nor measurable, the results here provide an indication that respondents do perceive there are benefits to certification.
ISO certification has:
Rank a. helped enhance the reputation of company b. significantly reduced waste within the production process c. significantly improved company’s position in the market place d. improved company’s chances of successfully selling its products in international markets e. caused company to investigate alternative technologies and procedures f. helped company design/develop better products g. placed reasonable demands on the information system and on data requirements h. significantly reduced overall costs i. significantly improved product quality j. significantly reduced lead times
The next research question focuses on the factors that influence companies to seek certification. We sought respondents’ perceptions (on a scale of ‘1’, least influence to ‘5’, most influence) on nine factors: improves corporate image, improves market opportunities, compliance with environmental laws, customers, employees, government, financial institutions, environmental pressure groups and suppliers.
Factors influencing company’s decision to gain certification
Rank a. improves corporate image b. market opportunities c. compliance with environmental laws d. customers e. employees f. government g. budget allocation h. financial institutions i. pressure groups j. suppliers
Research Design and Nature
Data Sources collected (Primary or Secondary,
Theoretical Framework of the research study (Dependent or Independent variables), Rationale- what style has been preferred (Qualitative or Quantitative way of research, the Data Collection Methods (Questionnaires from Subject Population),
Validity and Reliability of the collected data,
Hypotheses Formulation/Development (***** Very-Very Important Note: It is a PREREQUISITE to have definitely SIX
HYPOTHESES QUESTIONS formulated, concerning AIMS & OBJECTIVES & the SCOPE/PURPOSE of the research*****).
At the end of the chapter a Summary section outlining all the above from this chapter.
According to TQM’s basic principles, a long-term plan is required to achieve a complete quality transformation, but such a long-term plan that has been pursued for a long period may become an end unto itself. Completion of the plan often becomes the ultimate goal. Objectives the plan was designed to accomplish are eliminated; achieving the transformation becomes the main objective. Instead of maintaining continuous change, the organization may hit a stable point and stagnate. To produce continually high quality services, a business must react quickly to changes in the community and not be restricted by management style.
While TQM calls for organizational change, it does not demand radical organizational reform. Real quality improvement requires radical structural change, like flattening organizational structures, and the liberation of employees from oppressive control systems and functionalism, both of which stifle teamwork.
TQM calls for the elimination of the goals and objectives required by Management-by-Objectives. Critics of TQM claim that this may negatively affect motivation. They claim that having established production goals gives employees higher goals to reach, which motivates them to find innovative ways to reach the goals. When there are no established production goals, employees will only produce the minimum required to retain their jobs.
Some maintain that TQM delegates the determination of quality to quality experts rather than to “real” people. TQM claims that quality is a complicated entity that is beyond the average employee to comprehend without specialized training in statistical techniques.
TQM promises to continually improve the quality of corporate operations toward a goal of perfecting the quality of products and services to improve the competitive edge, as well as customer satisfaction and loyalty. However, despite these promises, many corporations have abandoned their TQM initiatives due to a lack of visible improvement. According to Dooyoung et al. (1998), “Despite the potential benefits of TQM articulated by quality gurus and consultants, and despite anecdotal success stories, the high failure rates (60-67%) quoted in the literature have made many companies believe that TQM has not been delivering on its promise” (p. 10).
This high failure rate is not attributed to flawed TQM principles, but to the lack of an effective corporate environment to carry out TQM principles properly. Leadership, organizational culture, quality infrastructure, and system readiness are commonly cited by the literature as the most significant contributors to the successes or failures of TQM initiatives.
However, leadership appears to be the most significant of these factors and some authors (Krumwiede et al., 1998) have conducted significant investigations into the relationships between the personalities of the leaders and TQM implementation. Krumwiede et al. (1998) contended that leaders play a key role in influencing the corporate culture and that their leadership behavior and personality are critical to a successful implementation of TQM. This logic suggests that the leaders are the most influential people in a corporation — “their commitment, personality, and vision are central to the focus of the corporate culture. Thus, TQM is a very important part of EMS, and, ultimately, TQEM.
Environmental Management Systems help organizations integrate effective environmental practices within their operating systems (Chinn, 2001). The boundary of influence for EMS’s is not as strong as that of TQEM as they tend to have structured requirements for only environmental performance with little integration of other societal dimensions. In their existing form, EMS’s require continual improvement on environmental objectives and targets after taking into consideration, effect its products have on the environment, organizational goals and the views of society.
The philosophy of TQEM is similar to that of TQM, yet the principles are expanded to achieve sustainable management of resources to meet society’s requirements, today and in the future. TQEM promotes the will of commitment for sustainability rather than compliance to specific or intended regulations. TQEM it is not a tool but rather a management philosophy that requires the organization to consider its social, economic and environmental performance to create a learning culture of continuous improvement.
Both TQEM and EMS address environmental issues but the TQEM approach is fundamentally different, as it challenges current organizational principles, particularly in regard to social responsibilities. Therefore, TQEM with its holistic view of meeting the needs of society ” requires a whole new structure, from foundation upward ” for innovative learning to take place (Chinn, 2001).
True commitment to the environment requires organizations to develop and implement policies on sustainable management. EMS techniques can limit innovation and changes to the organization that sustainability development demands (Chinn, 2001). Therefore, in the long-run, TQEM demonstrates a greater influence on sustainable development due to its philosophical approach and higher societal dimensions.
For TQEM to be successful, management must break away from current practices and change the values and philosophy of the organization to overcome the number and complexity of organizational issues that clash with society.
No matter which technique an organization implements, society will benefit directly from the outcome, however the degree of the outcome will differ greatly due to the intent and integrity of management.
The chief obstacle that is envisioned to develop an EMS is the level of effort required implementing such a system (Dufresne, 2000). There is also a considerable amount of confusion as to what is required to have an EMS that can be certified to the ISO 14001 Standard. There are some consultants who have abetted this lack of understanding by making a viable EMS seem more complex than it really needs to be. Perhaps their motivating factor has been to make it seem difficult in order to justify their services. Consultants can assist an organization with their experience, but the real drive to develop an EMS must come from within in order to achieve success over the long haul. Companies that have made an honest effort at compliance to regulations already have a leg up in developing their EMS. If they couple this effort with the tools they routinely use to manage their business, they will find that much of the framework for the EMS already exists. The ISO 14001 Standard provides an internationally accepted model that has an inherent amount of flexibility designed into it. Companies that have already developed an ISO 9001 Quality Management System can choose to readily adapt such existing systems as document management, internal system auditing and corrective action to their EMS. The emphasis in developing an EMS should be to integrate systems that have a proven track record and are known to work.
Most of the concepts discussed in this paper are part of what business management has evolved to become in the late 20th century. The concept of continual improvement or the reduction of the negative impact an organization has upon the environment is the cornerstone of an EMS (Dufresne, 2000). The management of environmental affairs should be elevated to the same level as any business issue. It should also be held accountable to the same criteria as any other parameter. Business owners and senior management should expect improved performance from their environmental department just as they would from quality and the efficiency of their manufacturing processes. It is the opinion of this writer that over time, the initial level of effort made to pull together an EMS will be justified by the streamlined management of environmental issues and the measurable gains in performance that are anticipated.
Integrating a Sustainable EMS with TQM
Businesses and governmental organizations use many different approaches to meeting quality and environmental quality expectations, depending on their size, structure, and business strategy (Chinn, 2001). Implementing a full or partial TQEM depends on how well a company’s quality and environmental management activities can be integrated with its existing organizational structure. With bureaucratic organizations, full integration can be hard because of their non-flexible and rigid functional divisions and departments. More participative organizations, which often focus on teamwork, have a much better opportunity for full TQEM integration. Those organizations, which have succeeded in combining environmental consciousness in their business operations, often have one characteristic in common. They all embrace the core TQM principles into their environmental quality and performance improvement practices.
Both TQM and environmental management are systems that depend on four core TQM principles that promote the survival of an integrated TQEM (Williams, 1997). These principles are (Chinn, 2001):
Customer focus: This principle is based on the idea that the entire quality deployment process begins with and is driven by an understanding of consumers (Berry, 1991). Customer focus is both a driver and a distinguishing characteristic between a QMS and an EMS. In a consumer-focused QMS, companies are pressed to conduct surveys, measure customer satisfaction, and utilize all surveyed data in the design of its products and services. Similarly with an EMS, an organization must continually assess the environmental aspects of its operational activities with a focus on reducing or eliminating negative environmental impacts on external and internal parties, or “environmental customers.” One of the primary goals of ISO 9001 is to eliminate waste in business activities and to produce products and services for optimum efficiency, without sacrificing effectiveness. ISO 9001 standards are written around conforming to specific requirements dictated by customers’ expectations related to a product, service or activity.
On the other hand, the ISO 14000 standards and guidelines are focused on controlling and reducing the effects of business activities on the environment.
Employee involvement: In TQM, this principle involves using the skills and experience levels of all employees in quality improvement activities. EMS encourages involvement by all employees of the organization to contribute their ideas and efforts to improve environmental performance. To progress these goals, employees at all levels of an organization are trained in integrating and leveraging quality and environmental management principles. Human resources management in the QMS/EMS integration effort may be the greatest challenge to implementing a sustainable QEMS. In today’s work environment, few organizations have integrated their quality and environmental management staff functions.
Monitoring and measurement: Performance monitoring and measurement enables the metrics that allow management to plan and make decisions within an organization. In a QMS environment, metrics are used to link performance to organizational and quality objectives. Under an EMS, metrics link environmental objectives, often focusing on compliance, with EMS program targets in specific operational activities. Innovations in business performance measurement techniques introduced through the quality transformation in the 1980’s have fostered quality-driven environmental performance measurement practices in many organizations. As a result of this transition, quality managers today are less dependent on “end-of-production line” inspections and are adopting quality assurance techniques implemented during design to prevent losses. With the transition from “end-of-pipe” environmental compliance actions to pollution prevention programs, EMS programs are now recognized for their value in reducing environmental compliance penalties, energy and resource waste, and lost time and money from accidents. The benefits of reporting EMS performance information, in the context of continuous improvement, are more widely recognized as more companies address environmental performance in their annual reporting strategies.
Continuous improvement: Continuous improvement links organizational strategies with the continuous need to maintain a given quality and performance level that meets customer expectations and enables businesses to remain competitive. This TQM principle centers on the universally applied quality improvement (QI) concept: plan, do, check, act. The aim of QI is to constantly identify and eliminate waste, or those activities that add little or no value to the product or service provided. When applied to an EMS, continuous improvement aims at reducing waste handling by modifying controllable activities related to business processes that have negative impacts on the environment. Continuous improvement collaborates with a key ISO element that is common to a QMS and an EMS
Corrective and Preventive Action. Other system elements that are addressed under common ISO 9001 QMS and ISO 14001 EMS elements can be integrated under a QEMS “umbrella,” including:
Document and data control
Control of records
Product realization and operational control
Monitoring and measurement
Corrective and preventive action
Internal system audits
Steps to Implementing an Effective TQEM Strategy
Mapping the key steps in developing a QEMS is essential to translate the concepts stated in the ISO 9001 and ISO 14001 standards. The difficulty with implementing an accelerated and comprehensive program is the reality that every organization faces these days – limited resources and conflicting priorities. As a result, many activities are delayed or eliminated because of lack of budget or resource. By prioritizing the most important activities during all stages of an implementation program, management can make more effective decisions as to how to allocate resources to what many consider to be an extra layer of activity. Essential steps within the TQEM implementation roadmap are as follows:
1. Develop an ISO Map – This tool displays the status of policy and procedure documentation needed to comply with the ISO standard, element-by-element. It cross-references between ISO 9001 and ISO 14001 and identifies specific Level 2 procedures and Level 1 quality/environmental manual sections, which correspond to elements of the standard. If desired, priorities are assigned based on identified need, gaps and other criteria reflecting importance or urgency. Process owners from the organization’s functional groups are listed on this map to reflect assigned responsibilities for implementing each system procedure.
2. Prepare a Project Plan – A Gantt chart project schedule is developed that identifies all key milestones, project activities, planned start and complete dates, responsibilities, and completion percentages. This chart is used to track progress against a baseline schedule.
3. Identify Process Owners – Process owners are those individuals selected to be responsible for completing and implementing assigned procedures. They are charged with leading the process team and taking ownership of the process described in the procedure and arranging for awareness training of the procedure after its completion.
4. Develop TQEM policies and procedures – Using a two-iteration process, policies and procedures are developed to reflect organizational policies and processes for identified processes, as needed and appropriate. The documents are prepared to a consistent format and may be text, 3-column, flowchart, or combination thereof.
5. Train Personnel – Personnel are trained during documentation preparation meetings, formal awareness training sessions and, where needed, in . Personnel training includes internal auditor training for persons authorized to perform internal audits for the organization.
6. Perform internal audits – Prior to the external registrar’s initial audit, the organization’s internal auditors should assess the operation of the TQEM under actual working conditions to identify and record any nonconformity from planned arrangements.
7. Implement Corrective Actions – Input from the internal auditor reports and other suggestions/recommendations should be translated into corrective actions and implemented as part of the organization’s continuous improvement process.
Management on a regular basis should evaluate the effectiveness of these corrective actions.
Efforts to implement a TQEM can be tedious unless an organization accepts and commits to the concept of value from integrating pollution prevention, energy and environmental management, and emergency preparedness and response in its core business processes. Adopting ISO 9000-based quality management practices, alone, cannot result in a sustainable environmental management system. And ISO 14001 cannot be viewed as the only management tool for implementing a TQEM (Hemenway, 1996). In addition to management standards, it takes top management commitment and buy-in from workers at all levels to transform existing environmental, health and safety practices to a business strategy, which supports a sustainable TQEM. Combining core TQM principles and EMS practices with effective process improvement techniques will have the best chance of success in integrating TQM and EMS.
Positive changes will occur if a strong quality foundation previously exists within an organization. For this to happen, an organization must have reached a stage of maturity as measured by four Critical Success Factors (Berry 1991) in developing and sustaining an effective TQEM process. These vital factors work together with the core TQM principles discussed early in this dissertation and are as follows:
management commitment to the environment and involvement in sustainable development;
supportive corporate culture, which fosters systematic integration of environmental issues into the decision-making process of the organization;
down training from quality, environmental, health and safety awareness to on-going skills training;
Customer communications, including aligning customer needs throughout all aspects of the organization’s human resource, business management and technical practices.
These success factors enable traditional environmental management practices to move away from “command and control” regulatory response actions and focus on pollution prevention efforts. These factors, working synergistically with the core TQM principles, will help businesses to lower your cost of doing business, capitalize on new market opportunities and improve environmental performance.
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