This report has been prepared to analyze the rise and fall of ISO 9001 and to forecast the upcoming trends in the total number of ISO registrations worldwide.
Operations and Project Management
Forecasting and Time Series Analysis
This report has been prepared to analyze the rise and fall of ISO 9001 and to forecast the upcoming trends in the total number of ISO registrations worldwide.
Contents
Worldwide and Country Analysis. 5
Smoothing and Forecasting Technique. 9
Introduction
Increased globalization, complex supply chains, and new business processes created much awareness among suppliers and customers. The continuous penetration of quality management systems in society has made everyone concerned and informed about the importance of effective implementation of ISO 9001 standard.ISO 9001 standards comprised of requirements as well as the guidelines which when combined make up an ISO portfolio in a context of quality management. If someone is looking to get certified or registered officially with ISO 9001, fulfilling the stated requirements of a standard is mandatory. On the other hand, guidelines as the name implies are just for value-addition purposes. These are the suggestions and recommendations which can be fruitful information. These are not compulsory to comply.
Purpose
With a vision to help organizations seeking assistance in consistently improving the quality of their services and products, ISO 9001 series standard has been developed. An Effective Implementation of this standard ensures that the organization is concerned with meeting the needs of its customers and other stakeholders while fulfilling regulatory and statutory requirements.ISO 9001 is one of the most well-known standards. The organization that wishes to adopt the ISO 9001 standard has to fulfill the requirements of this. It is not for any specific industry; every company can implement and get the benefits from it. ISO 9001 management system can be applied to any organization irrespective of its kind and size and it is widely getting used in developed countries (Zutshi and Sohal, 2005). The acceptance towards ISO 9001 quality management systems is also increasing in developing countries (Casadesus et al., 2008). More than a million certificates have been issued to over 190 countries worldwide. ISO 9001 is that management tool which is being used widely around the world despite all the criticism that it is not useful for all type of organizations.
Evolution
Organizations in the 1970s started publishing their standards related to quality management systems (e.g. the Ministry of Defense’s 05–20 series, Ford’s Q101, etc.). By doing so, the concept of an approved quality management system has been established so that reliance on a product can be achieved.
Development of Standard
· History of ISO 9000 certification goes back to the year 1987 in which the first standard has been developed. The first version (ISO 9000:1987) shared the same structure as of BS 5750 which is a UK standard. Depending upon the scope of activities of an organization, it presented three models for quality management systems.
· The first revision came out in 1994 which had a mission to refine an old standard. It highlighted how quality assurance can be achieved by using preventive actions technique. It also maintained the old practice of getting compliance evidence with documented procedures.
· The second revision in 2000 introduced process management conceptualization. Also, this revision attempted a drastic change in thinking.
· The fourth edition of the standard arrived on 14th November 2008. This revision came out with no big changes. It focused on the clarifications for existing requirements. Also, it tried to improve the consistency of approach concerning other standards like ISO 14001.
· In September 2015, the last revision got published. The aim is to update the last edition and to show the latest good practices of quality management. This standard is more integrated with other ISO management standards.
Top Ten Countries (2015)
Six European countries (Italy, Germany, UK, Spain, France, and Romania) have made it to the top ten lists.
China is leading with 292,559 certificates in the list while Romania being the last on the list. Japan is in the fourth position. The United State of America is lagging behind India by one position and placed on the seventh number. In 2015, out of 1,033,936 total certificates, 1,029,746 has been issued against ISO 9001:2008, and rest 4190 certificates got registered against the 2015 version.
Worldwide and Countries analysis
Certifications statistic (1993~2015)
If we look at the overall trend, we would come to know that from 1993 till 2002, Certifications number kept on increasing which eventually reduced by 63,847 certificates (-11% Annual Growth) in 2003. After that, it again started to increase until the total numbers dropped by 66,680 certificates (-6 % Annual Growth) in 2011. In 2015, numbers got diminished again by 2385 having an annual growth of -0.2 %. In 2003, ever continent faced a reduction in certificate numbers as compared to the previous year except for East Asia. The maximum number of certificates (1076525) got recorded in 2010. Except for 2003, 2011, and 2015, every year certificate numbers got increased by some numbers than the previous year.
Annual Growth
It is also clear from the below graph that the annual growth kept on changing in past years and there are three events in which negative annual growth has been observed. The maximum annual growth of 81% has been observed in the year 1995 very after the first revision of ISO 9001.
Regional Share
The below graph clearly shows that in 1993, Europe and East Asia & Pacific started with a regional share of 81.1% and 10.2% respectively. With all those years passed by, East Asia & Pacific is now one of the biggest regional shareholders after Europe. Drastic reduction in European regional share is also due to the efforts which East Asia is putting towards acceptance of the standard. China because of its expanding business all around the world and one of the most growing economies is on top of the list in East Asia & Pacific.
Inter-Continents analysis
On a bigger scale, there is some consistency observed among Continents regarding their positions when it comes to securing the most number of certifications every year since 1993. Africa has the least regional share of 1.2% in 2015. South and North America are at the regional share of 4.8% and 4.5% respectively. South Asia and the Middle East are at 3.9% and 2.2% respectively.
Europe vs. East Asia and Pacific
Europe always stood up as a most prominent continent throughout the world and always secured the maximum number of ISO 9001 certifications every year since 1993. However, East Asia & Pacific seems to penetrate the market with more certifications every year than previous and hence ended up with a regional share of 40.9% which is the second-highest after Europe having 42.5 % in 2015. Not only, it is the second-highest among continents in 2015, it always maintained its second position throughout since the beginning. It doesn’t mean that both Continents never faced a reduction in annual growth. They both have experienced negative growth in some years but still, they have managed to secure their positions. Because ISO is a European based organization so this can be one of the other reasons why Europe is always on top when it comes to the number of registered certificates. Europe faced a reduction in a couple of years and in the last three years including 2015, their graph is declining. Apart from this, numbers got diminished then the previous year in 2003 and 2011. On the other hand, East Asia seems much interested in ISO 9001 because its numbers in the last three years started increasing. If it maintains this interest in securing ISO 9001 certification every year, it may come across as the most prominent continent.
Countries per Continent
Interestingly in 2015, Africa has got the maximum number of Countries that are certified among all continents while Europe is in second place. Also, every year mostly, their numbers of countries are increasing. North America is in the last place having three countries that managed to gain ISO 9001 certification in 2015.
Inter-Countries Comparison
Greece vs. Pakistan
A study that has been conducted in European countries about the companies which are certified as per ISO 9001 standards has stated that Greece is still in the phase of development which means that Greek companies have this potential to grow their quality assurance systems (Franceschini et al., 2011). Greece being one of the countries in Europe seems to be more focused every year regarding ISO 9001 implementation. If we look at the below graph, we would be able to see that in 2003, certification numbers of Greece got decreased which can be due to the controversial year of 2013 as many political activities were getting happened throughout the year. Again in 2009, the reduction has been observed and continued for two more years. In 2009, the Greek crisis started because of the weaknesses in the economy of Greek so we can say that due to an unstable economy, there is no consistent growth in the certification numbers. Due to the volatile market of Pakistan, companies somehow started implementing ISO 9001 in their organizations but failed to derive some practical benefits from it due to non-seriousness and lethargic attitude. In Pakistan, specifically, most of the organizations implement ISO 9001 just to fulfill their customers’ demands so that they can get business. There are very few companies that implement ISO 9001 to get benefits from it. This is the reason that since 2005 till 2015, there is not any major improvement recorded. Though, on the other hand, we can say that they are consistent in retaining certification numbers in the same range that they have achieved in 2005.
Smoothing and Forecasting Techniques
Worldwide
To analyze given data in more detail, to remove the random error and high frequencies, we have applied two techniques, Moving Average and Exponential Smoothing. We can see clearly from the below graph that the overall trend is in an upward direction. Certificates number is increasing despite some numbers reduction three times in all these years. In the last couple of years, change is slow, line graphs are converging except Moving average.
Double Exponential Smoothing
If we compare double exponential smoothing with the actual number of certificates, we would come to know that since 2011, the smoothed graph is going downwards slowly because the improvement in certificate numbers from 2011 till 2014 is not a drastic one and also in 2015, numbers got dropped eventually.
Europe
By looking at the below graph, it becomes apparent that the last three years do not seem competitive for Europe in the context of securing ISO 9001 certifications. Their performance in the last three years got affected although this reduction is not that much drastic in comparison to what happened in the years 2003 and 2011.
Double Exponential Smoothing
Even in DES, it becomes apparent that smoothed values show the declining behavior of certificate numbers
East Asia & Pacific
Performance in the last three years also made some facts clear in all the below line graphs. Because of China’s considerable interest in ISO 9001, the total numbers of this region are increasing despite some setbacks in the past.
Double Exponential Smoothing
The graph shows smoothed values as almost in a straight line from the year 2011. This is because the drastic and consistent improvement in certificate numbers has not been recorded in the last few years.
Greece
Even after smoothing the data, it reflects the changes which happened in the past years. Overall the condition would improve in the future as smoothing data shows some improvement in numbers. The variations like the past would persist due to nonstability in this part of Europe.
Double Exponential Smoothing
The below graph shows a bit of an uprising trend in the last two years after smoothing the values.
Pakistan
In the last eleven years including 2015, numbers are in the range of 2000~2500. According to smoothing data in the below graph, the certificate numbers will continue to remain close to 2500 shortly. There is a little chance that it might cross the number of 2500.
Double Exponential Smoothing
The below-smoothed graph shows a straight line since 2012 as in the actual graph, numbers started rising in the year 2012 which in 2015 gets decreased.
2016 Forecasting
Worldwide
Using Double exponentials smoothing, we forecasted certificate numbers worldwide. In the below graph, the red line is showing actual data of certificate numbers up to 2015 and blue line which is a forecast one ended up on a number 1,112,112 in 2016.
Europe
Using Double exponentials smoothing, we forecasted certificate numbers for Europe. In the below graph, the red line is showing actual data of certificate numbers up to 2015 and blue line which is a forecast one ended up on a number 483,768 in 2016.
East Asia
Using Double exponentials smoothing, we forecasted certificate numbers for East Asia. In the below graph, the red line is showing actual data of certificate numbers up to 2015 and blue line which is a forecast one ended up on a number 450,843 in 2016.
Greece
Using Double exponentials smoothing, we forecasted certificate numbers for Greece. In the below graph, the red line is showing actual data of certificate numbers up to 2015 and blue line which is a forecast one ended up on a number 6,414 in 2016.
Pakistan
Using Double exponentials smoothing, we forecasted certificate numbers for Pakistan. In the below graph, the red line is showing actual data of certificate numbers up to 2015 and blue line which is a forecast one ended up on a number 2,687 in 2016.
Conclusion
Considering all the analyses of smoothing and forecasting, we have now much data to conclude our results. We have seen the underlying variations and trends in all of the graphs as already discussed before. By looking at the overall picture of the world statistics, there is a chance that the total number of certificates would get incremented in comparison to last year. Even though East Asia comes up with higher certificate numbers every year than the previous one, Europe always played an important role in maximizing the certificate numbers overall. Statistics are showing that in the future, East Asia has got potential to displace Europe from the most prominent continent position. If East Asia maintains the consistent uprising trend, it can also impact the total certificate numbers. Also, if we look at the certificate numbers on a time series, we would come to know that previously, three years got recorded with a lower number of certificates then their respective previous year. Those years were 2003, 2011, and 2015. Never in history, had two consecutive years got recorded with even lower certificate numbers than their immediate previous year so after 2015, we are quite optimistic that numbers would get increase as compared to what was recorded in 2015.
References
· Zutshi, A. and Sohal, A.S. (2005), “Integrated management system: the experiences of three Australian organizations”, Journal of Manufacturing Technology Management, Vol. 16 №2, pp. 211–232.
· Casadesus, M., Marimon, F. and Heras, I. (2008), “Countries behavior regarding the diffusion of ISO 14000 standards”, Journal of Cleaner Production, Vol. 16 №16, pp. 1741–54.
· Franceschini, F., Galetto, M., Maisano, D. and Mastrogiacomo, L. (2011), “A proposal of a new paradigm for national quality certification systems”, International Journal of Quality & Reliability Management, Vol. 28 №4, pp. 364–382.
