The Power of the Management Review

In my previous post, I discussed the art of the Management Review. “So what?” you might ask. Where is the payoff? 

Your company must communicate with customers and suppliers. To do this effectively, your company must communicate well internally. This communication is essential to grow your business, and as your business grows, the importance of unifying your team grows. The power of the MR lies in exposing these communication threads and strengthening them. The following benefits are independent of potential after actions to pursue ISO 9001 certification.

Face-to-face information exchanges

Experience has shown that most people know surprisingly little about what others in the company do; and even more surprising, management is not exempt from this condition. It is difficult to overstate the value of periodic face-to-face meetings among the company’s finest. People get to know and trust each other; and a mutual understanding of the work all do can raise the level of further information exchange regarding a wide range of company issues.

A well-planned, well-run MR is a morale booster because it brings key company personnel together to work as a team for the purpose of improving the company. Each attendee benefits from 1) gaining a clearer sense of how the role they play benefits the company, 2) understanding how that role can be refined and the company strengthened through interactions with teammates, and 3) bonding with those teammates.

Paper trail

Briefing materials, prepared under consistent guidelines, are useful to briefers and listeners alike. These materials can provide source material for proposals. They can be used (following redaction when necessary to exclude proprietary information) to describe the company to new hires, interviewees, guests, teammates, and customers. Meeting minutes and an action-item list are key outputs that capture the lessons and decisions from the meeting. In the event that the MR is part of the ISO 9001 Quality Assurance standard, this paper trail will be source material for much of the information required for certification.

Continual Improvement

One outcome, not generally anticipated by management, is a resolve to do MRs periodically. This tends to confirm the MR’s value and the ISO 9001 requirement for periodic MRs. It is also consistent with the 9001 principle of continual improvement – as MRs are integrated into company culture, their cost / benefit ratio improves.

Management Review, the Art and the Facilitator

An MR has three overarching phases: preparation; execution; and follow-up. The art of the MR lies in delineating and coordinating these three phases effectively. While the MR is “the CEO’s meeting,” the CEO may not have the time or inclination to manage it. This challenge is normally remedied by designating an MR Facilitator, either a company employee or an outside consultant, to act as the CEO’s agent. In an ISO-9001-certified company, the Quality Representative typically assumes the role of MR Facilitator.

If you are a CEO, you may be thinking, “why would I need some outside consultant to come in and tell us what to do? If I need help with this, I can ask one of my people to go on line, find a checklist (here is one, by the way), and just get ‘er done.” I call that “learning by doing” and, depending on who is carrying out the task, it might work out well; it is also true that no outsider can honestly guarantee success.

However, the cost to engage a consultant as Facilitator is actually a small part of the investment in an MR and, when matched against the potential payoff, looks even smaller. To the first point, each actor in the MR will have to take time away from daily activities to prepare for and play his role in the meeting (the execution phase). Whether this cost is hidden or explicit (charged to overhead), it can amount to a considerable investment of time. An experienced Facilitator should be able to raise the probability that such time is invested wisely.

As CEO, you may still be wondering, “What can an outsider, however experienced, possibly know about my company?” When he first comes on the scene, probably not much. However, his lack of knowledge just happens to be the key that lets the Facilitator unlock the power of an MR. A good Facilitator brings two critical qualities to an MR: first, the curiosity to learn as much as he can about your company as quickly as possible; and second, knowledge of the questions to ask – from an ISO-9001 perspective, your perspective, and his own perspective – in the form of briefing templates, to learn much of what he would need to know were he to be named the new CEO. To reinforce the point, the Facilitator brings process, but the knowledge specific to your company will come from within your company where it may now lay hidden.

To the second point, it will fall to the Facilitator to assure that the goals, objectives, and processes of each MR phase are clear to all. The Facilitator is responsible for asking the right questions of each actor at each stage of preparation and for making an initial judgment regarding whether the answers are sufficient. Another way to look at this is that, as the CEO’s agent, the Facilitator must understand what the CEO needs to know and when he needs to know it.

A tight focus will be critical to MR success. Less obvious, perhaps, is that attendee engagement is a necessary condition to that focus. It will be incumbent on the Facilitator to incorporate both challenge and humor in the MR to keep all attendees awake and active. If MR preparation, conduct, and follow-up are the art, the Facilitator is the artist.

How ISO 9001 can benefit Management Review Contents

In previous posts I have emphasized that a Management Review (MR) need not imply a commitment to ISO 9001 certification. That is true, but there are advantages to using the knowledge of the ISO 9001 Standard in designing an MR.

The Standard represents Management Experience

The ISO 9001 Quality Assurance Standard has gone through several iterations over more than 30 years. As such, it represents a very considerable management experience base. ISO 9001:2015 is now being implemented. The standard is based on seven management principles: 1) Customer focus; 2) Leadership; 3) Engagement of people; 4) Process approach; 5) Improvement; 6) Evidence-based decision making; and 7) Relationship Management. An examination of how the standard is defined within each of these areas gives rise to a class of questions: Are we doing that? If so, how well are we doing it? If not, why not?

In the unlikely case that the company is doing everything that ISO 9001 would ask of it, a sense of validation comes from knowing that. In the more likely case that the questions expose areas of neglect, potential risks, and opportunities for improvement, it is better to know that now than to be surprised later.

ISO 9001 Audit Preparation

A corollary to the first advantage is that, if the company does plan to pursue ISO 9001:2015 certification, the MR will anticipate questions that arise during an external audit. Whether or not the MR serves as an entry point into certification, it offers some of the best features of ISO 9001.

A Complement to CEO Needs

The MR is the CEO’s meeting; he sets the requirements, goals, and objectives. That said, since the option is available, it makes perfect sense to draw on ISO 9001 requirements to either complement or validate his choices in that regard. Very few CEOs have become successful by ignoring the experience of their predecessors. As it relates to the MR, why would a CEO ignore that body of wisdom from previous CEOs and management experts?

The Management Review Connection to ISO 9001

A leading indicator in business is communication. The more effectively employers and employees work as a team, the better their mutual chances of success. One effective mechanism of business communications, the Management Review (MR), brings together key company personnel to 1) share information critical to assessing company status, 2) examine long-term company strategies and near-term objectives, and 3) decide on actions to implement strategies and meet objectives. The MR, while often tied directly to the ISO 9001 Quality Standard, can also be developed as an independent event.

ISO 9001 is a widely-accepted Quality Assurance model from the International Organization for Standardization (ISO) designed to reduce waste and variation in product characteristics and process parameters. ISO 9001 brings the discipline of regular audits of processes and business assessments to bear on continual improvement of customer satisfaction and employee morale. ISO 9001 certification helps to maintain that discipline and may result in increased recognition by customers and teammates. Since ISO is currently implementing the new 9001:2015 Standard, now is a good time for companies to consider that implementation. On the other hand, since no quality management approach is right for all, it is important for any company to carefully evaluate the relevance before entering into the ISO-9001 certification process.

Regular (annual or semi-annual) MRs are an ISO 9001 requirement. There are at least two reasons for this: first, constructed and executed properly (as judged by an outside auditor), they help companies uncover much of the information required by the standard; and second, they provide an opportunity to ensure that ISO 9001 processes and benefits are understood and practiced throughout the company. The latter point is judged sufficiently important that most ISO 9001 auditors will interview company employees at random when they visit the company site for the initial audit or a renewal; they want to know if ISO 9001 policies and guidelines have been adopted by the entire company or by just the CEO and his Quality Representative.

MRs need not be tied to ISO 9001. However, for companies uncertain of the value of ISO 9001, an MR represents a low-risk entry into the heart of the standard prior to the assumption of the additional cost and risk associated with certification. Moreover, whether or not it is the precursor to certification, an independent MR can benefit from incorporating some or all of the widely-accepted features required by ISO 9001.

Random thoughts about ISO 9001 per se: for a company interested in becoming ISO-9001-compliant from top-to-bottom, there is much to be gained from the process; by contrast, if the purpose is to have a certificate to “hang on the wall,” the cost may exceed the benefit.