Released, 20 April 1998.

The McCannics e-survey, month just ended March 1998

ISO9000 and Quality Systems

Many businesses are choosing to become registered under the ISO 9000 Quality Standard, but some argue that this is under pressure from customers and that ISO 9000 does not necessarily lead to real improvements in business performance. In this survey we asked UK businesses about their experience of ISO 9000.

Respondents (mostly owners and managing directors of small firms with internet web-sites, but including a few managers of very large firms) were first asked whether their firm is registered for the ISO9000 Quality Standard.

The chart (right) shows that only 15 per cent of respondents are currently registered, though a further 6 per cent do intend to become registered in the future.

"Is your business currently ISO 9000 registered?"

"Is your business currently ISO 9000 registered?"
- by firm size

This overall picture, however, masks the fact that ISO9000 is, in practice, a standard for the larger firm.

The chart (left) shows that 86 per cent of the firms in our sample with 50 or more employees are already registered for ISO9000. The remaining 14 per cent intend to register soon.

The vast majority of firms smaller than this, however, are not registered for ISO9000 and have no intentions of becoming registered.

Of those firms which are registered for ISO9000, opinions are split over whether it offers genuine improvements in the quality and/or consistency of the output of the business.

The chart (right) shows that 58 per cent of those firms which are registered claim that they have achieved such benefits, but that 42 per cent of registered firms say that ISO9000 has not led to any significant improvements in the quality or consistency of the products or services which they supply.

Even among those who have witnessed improvements, there was not universal enthusiasm for the ISO9000 standard. Comments from firms which said that they had achieved significant benefits from ISO9000 registration, nevertheless included:

"We have obtained some minor benefits in terms of quality improvements - however it is increasingly becoming an essential requirement with our customers so it is just another cost of doing business."

and

"In my experience ISO 9000 has largely had its day and many more people appear interested in IIP [Investors in People]."

Mandy McCann, Quality Consultant of McCannics says, "The danger with ISO9000 is that customers demand registration of their suppliers, but only larger firms can afford the registration process. The customer then gets a product which is of consistent, but not necessarily high, quality. The small firms, which may be providing a higher quality product, are unable to compete".

More comments...

" If your business is registered,
do you believe that this has led
to significant improvements in
the quality and/or consistency
of the products or services which
you supply?"

Two of the firms taking part in the survey specialise in Quality Systems and asked to be mentioned. They are Business Challenge Ltd and Q I & T S Ltd.

McCannics itself also has a Quality consultancy division. For details, please contact Mandy McCann, who "believes strongly in the principles of a quality system, but not necessarily in the bureaucracy of an ISO9000 approach".

Sales and Prices

The internet-connected firms taking part in this survey continue to report positive news on sales over the past month.

Some 62 per cent of the firms said that their sales were higher in March 1998 than in March 1997, while 20 per cent said that they were lower. The resulting balance (the proportion saying higher minus the proportion saying lower) of +43 per cent is little changed compared with last month (+44 per cent).

"Was your sales turnover in the month just ended higher, about the same, or lower than in the same month last year?"

Note: Chart shows percentage balances (percentage saying higher minus percentage saying lower). Earlier surveys include late responses and so may differ from figures published elsewhere.

"Were your average selling prices in the month just ended higher, about the same, or lower than in the same month last year?"

Note: Chart shows percentage balances (percentage saying higher minus percentage saying lower). Earlier surveys include late responses and so may differ from figures published elsewhere.

In this survey, 39 per cent of respondents reported that their selling prices were higher in March 1998 than in March 1997, while 11 per cent said that their prices were lower. The balance of +28 per cent reporting higher prices compares with +23 per cent last month.

The unsponsored e-survey is carried out by McCannics, which also helps to carry out a number of other business surveys, including the NatWest/SBRT Quarterly Survey of Small Business in Britain and the 3i Enterprise Barometer.

Questionnaires are sent out and returned by e-mail each month. If you would like an e-mail to notify you each month when the latest e-survey is published, then please send an e-mail to esurvey@mccannics.co.uk with the subject SUBSCRIBE.

This ninth survey questionnaire was sent out on 2nd April 1998 and by 15th April responses had been received from 82 businesses across the UK.

As well as covering issues of topical interest, the e-survey aims to provide an indicator of prevailing business conditions, well in advance of official statistics and traditional postal surveys, and it has already found a place in the Bank of England’s Quarterly Small Business Report. Increasing its value depends on it recruiting more volunteer UK businesses, willing to complete a very short e-mail questionnaire each month. Owners or managers of businesses in the UK which would like to take part in the survey should send a blank e-mail to: volunteer@mccannics.demon.co.uk

All individual replies will be kept strictly confidential. Only anonymised results will be published, and your e-mail address will not be passed on to any third party.

Details of the sample were included in the first survey.

E-mail us with comments, queries or suggestions for future topical questions at: esurvey@mccannics.co.uk

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