Organizations across the world make significant efforts to achieve accreditation for various operational outcomes. Some of the most commonly recognized accreditations are provided by the International Organization for Standardization (ISO). The two most pursued accreditations are the quality management system accreditation and the environmental management system accreditation, which are covered under the ISO 9001 and ISO 14001 standards, respectively. ISO 9001 provides a framework to be followed in the development and implementation of a quality management system. ISO 14001, on the other hand, is a framework for environmental management systems.
Similarities and Differences between Accreditation Systems
The two accreditation systems do not function as independent standards. They are both used in combination with other standards or as frameworks that help in achieving the requirements of other standards. One of the similarities between ISO 9001 and ISO 14001 is that both of them promote process improvement. ISO 9001 emphasizes continuous improvement through the identification of systems that are founded on specific elements of organizational operations (ASQ, 2020a). The most important aspect of the system is that it focuses on the improvement of quality and process efficiency, both of which are good indicators of effective performance. Similarly, ISO 14001 focuses on the continuous improvement of environmental management practices, which is considered an essential indicator of effective performance, particularly in contemporary times whereby organizational efficiency is pegged on measures of sustainability, key of which is environmental management.
Secondly, both standards present leadership as one of the tenets of their respective modelsThe implementation processes for the different ISO frameworks are also similar, including the stakeholders involved and the impacts on business effectiveness.
Despite the similarities between the ISO 9001 and ISO 14001, there are also significant differences between them. The major difference between the two is the area of focus. While ISO 9001 focuses on the effectiveness of the operations process- achieving continuous improvement in product/service quality, ISO 14001 focuses on environmental operations- continuous improvement and compliance with environmental management standards (ASQ, 2020b). Accordingly, it is deductible that while ISO 9001 is customer-centric, ISO 14001 is internally oriented.
Impacts of Accreditation Systems on Business Excellence
The goal of every business seeking an ISO accreditation is to enhance its performance in at least the aspect covered directly by the accreditation requirement. ISO 9001 and ISO 14001 both have significant impacts on business performance, particularly on business excellence (ASQ, 2020a). One of the common impacts of the two systems is that they improve resource efficiency. While ISO 9001 improves the efficiency of resource utilization in production processes through achieving higher quality standards by the same resources, ISO 14001 improves efficiency through the improvement of environmental management and the ensuing sustainability (ASQ, 2020b). In either case, there is a set of drafted policies and objectives to be pursued, which increases the organizational focus on its abilities and how it can optimize the benefits from them.
Accomplishing certification based on the two accreditation systems also helps organizations to achieve excellence by reducing wastes. Waste reduction in organizational operations helps to improve profitability, which is the foundation of business excellence. In both environmental management and quality improvement, waste management is a crucial strategy for optimizing resource utilization; it also indicates an improvement in process efficiency, both of which reduce operational costs and thus improve profitability (Pohle, Blind, & Neustroev, 2018). Since profitability is the core economic objective of any business, sustainable profitability is considered as one of the core indicators of business excellence, and companies choose to pursue the accreditation systems that promise optimum outcomes in profitability. Priede (2012) reports that more companies go for ISO 9001 compared to those that pursue ISO 14001. This choice is because the quality management systems have outcomes that directly impact profitability through their impacts on customer relations, while the environmental management systems affect performance indirectly, and their impacts on profitability are of lower magnitude compared to the impacts of quality management systems on profitability.
Certification under ISO 9001 and ISO 14001 can improve performance by their impact on statutory and regulatory requirements. According to Pohle et al. (2018), different countries have different quality and environmental standards based on which they are evaluated for performance. The quality and environmental standards have different statutory requirements, which have to be accomplished by all companies operating in specific industries. By maintaining ISO 9001 and ISO 14001 as the underlying frameworks for quality management and environmental management, respectively, the compliant organizations inevitably adhere to the requirements of the law (Pohle et al., 2018). This means that whatever the location of the company is, compliance with the ISO accreditation systems translates to compliance with local systems as the ISO systems are both comprehensive and international.
Challenges to the Business Excellence Journey
The journey towards business excellence is marred with various challenges that organizations seeking to achieve success must overcome. In the journey towards business excellence, the types of challenges vary from one business to another and from one industry to another. For instance, one of the challenges that can be faced is in communication strategies. In any organization, communication has to be both vertical and horizontal. Understanding communication needs can help an organization to plan its resources effectively and achieve the goals outlined under both ISO 9001 and ISO 14001 (Priede, 2012). In some organizations, however, there are breakdowns in communication, which result in a lack of clarity, lack of direction, and inadequate management support for the pursuit of business excellence. Communication also results in other challenges, such as lack of employee engagement and distrust of processes, which hamper the journey towards business excellence.
Another challenge that can be faced in the journey towards business excellence is the lack of drive and consistency. According to McNamara (2009), one of the principles of management, as proposed by Henri Fayol, is the focus on the unity of direction. Brown (2014) further posits that unity of direction can only be achieved where there are clear goals and objectives, and organizational stakeholders are unified towards achieving those goals and objectives. This implies that in a business environment in which there is limited unity towards organizational goals or where the organizational goals are implicit, there can be a lack of consistency and lack of drive towards business excellence (Hao & Yazdanifard, 2015). Where there are divergent goals and objectives, organizational stakeholders are bound to reach different destinations. In this way, lacking drive or consistency becomes a hindrance to the achievement of business excellence.
Lack of leadership support could also be a challenge to business excellence in various ways. The management of any organization is responsible for providing a supportive environment for the pursuit of organizational goals and objectives. The management is responsible for strategic planning, provision of resources, and supervision of implementation practices (Brown, 2014). This means that without leadership support, organizations lack guidance and supervision towards the pursuit of business excellence; they may lack resources for the implementation of proposed practices and standard operating procedures; and a clear direction on organizational strategic plan (Hao & Yazdanifard, 2015). The combination of these outcomes is disastrous in any effort towards business excellence. Brown (2014) further purports that a lack of management support is the source of other challenges, including communication challenges, which may result in low productivity and poor performance in general.
The Role of Leadership in Addressing Business Challenges
The importance of leadership support towards the accomplishment of business excellence objectives indicates the importance of the role played by the leadership on the journey towards business excellence. Research by Brown (2014) shows that for all challenges to be addressed effectively, the input and support of leaders are required. One of the ways through which organizational leadership helps in addressing business challenges is through the development of an organizational culture that supports employees. Business excellence, even through the implementation of the requirements outlined in the ISO 9001 and the ISO 14001 accreditation systems, requires resources and clear strategic goals (Sony, 2019). The first step in complying with the frameworks provided under both systems is to be intentional in the expected outcomes. The organization, beginning with its leaders, has to agree to pursue the accreditation. This is achieved through leadership decision to work towards a clear organizational goal, which is shared with the organization and the employees motivated towards it. This is to say that organizational leaders create good opportunities and support networks for consistency and drive towards achieving organizational goals.
Secondly, leaders also have the responsibility of providing the requisite resources for the accomplishment of the set organizational goals and objectives. Brown (2014) suggests that resource inadequacy can be a challenge, even where there is a clear goal to be achieved. Resources include tangible and intangible resources, as well as human resources. Organizational management is responsible for hiring the right people in the right positions and giving individuals in supervisory roles the authority and responsibility of managing their teams (Brown, 2014). Accordingly, various studies have indicated that having the right people in the right positions not only helps in the communication of organizational goals to the rest of the team but also to foster an environment of the intentional pursuit of those objectives. The individuals placed in various positions of authority have to be able to handle crises when they occur, and the competency levels of the hired individuals determine their ability to handle those crises (Brown, 2014). With the right people and the right tangible and intangible resources, achieving business excellence is possible. Additionally, leaders can initiate the use of business excellence frameworks to facilitate the implementation of procedures for accreditation systems and adherence to standards.
Conclusion
Business excellence is one of the major objectives of any organization. To steer organizational stakeholders on the path towards business excellence, organizations use different approaches, including training leaders and developing effective and explicit organizational strategic plans. The use of accreditation systems, such as ISO 9001 and ISO 14001, also helps organizations to achieve specific business excellence objectives. ISO 9001 and ISO 14001 are accreditation systems for quality management and environmental management, respectively. These systems are similar in their focus on continuous improvement, leadership support, and benefits to organizations. On the other hand, they majorly differ in terms of their focus, in that ISO 9001 focuses on customer needs while ISO 14001 focuses on environmental needs. These differences notwithstanding, these systems help organizations to increase efficiency, reduce costs, and promote profitability, all of which are important outcomes associated with business excellence. Organizational leaders play an important role in leveraging the benefits associated with the ISO accreditation systems as well as with their authority as leaders. Through effective hiring practices, provision of resources, and development of effective strategic plans, organizational leaders can develop supportive processes for the achievement of business excellence.
References
ASQ (2020). What is ISO 9001:2015 – quality management systems? American Society for Quality. Retrieved from https://asq.org/quality-resources/iso-9001
ASQ (2020). What is ISO 14001:2015 – environmental management systems? American Society for Quality. Retrieved from https://asq.org/quality-resources/iso-14001
Brown, A. (2014). Challenges to business excellence: Some empirical evidence. Nang Yan Business Journal, 1. Retrieved from https://content.sciendo.com/view/journals/nybj/1/1/article-p76.xml?lang=en
Hao, M.J., & Yazdanifard, R. (2015). How effective leadership can facilitate change in organizations through improvement and innovation. Global Journal of Management and Business Research: Administration and Management, 15(9). Retrieved from https://globaljournals.org/GJMBR_Volume15/1-How-Effective-Leadership.pdf
McNamara, D. E. (2009). From Fayol’s mechanistic to today’s organic functions of management. American Journal of Business Education, 2(1), 63-78. Retrieved from https://files.eric.ed.gov/fulltext/EJ1052767.pdf
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Sony, M. (2019). Implementing sustainable operational excellence in organizations: An integrative viewpoint. Journal of Production & Manufacturing Research, 7(1), 67-87. Retrieved from https://www.tandfonline.com/doi/full/10.1080/21693277.2019.1581674