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Adequacy, Suitability, Effectiveness and Efficiency of Quality

Management Systems: How to Perceive and Assess them?
DOI: 10.12776/QIP.V20I2.736

Jaroslav Nenadal

Received 05 June 2016, Revised 16 September 2016, Accepted 27 September 2016

ABSTRACT
Purpose: The paper brings set of original information related to the ISO
9001:2015 standard´s requirements focused on assessment and review of quality
management systems adequacy, suitability and effectiveness.
Methodology/Approach: Brainstorming, field research, seminars, comparative
literature analysis, interviews and design review were used.
Findings: According to the ISO 9001:2015 the quality management systems
adequacy, suitability and effectiveness must be assessed and reviewed, in spite of
the terms adequacy and suitability are not defined at the ISO 9000:2015 standard
at all. Also literature review has discovered serious absentation in this area of
interest. Additionally: the most of organizations managers (including quality
professionals) do not understand these features of the modern quality
management systems.
Research Limitation/implication: Special research activities focused on
perception and practical using the quality management systems adequacy,
suitability and effectiveness assessment and review was performed on sample of
172 Czech organizations (with 30 % response rate). A hypotheses described by
Fig. 1 below cannot be confirmed as relevant data are unobtainable from Czech
organizations at present.
Originality/Value of paper: The paper brings original set of information,
regarding to definitions of terms as well as development of the quality
management systems adequacy, suitability and effectiveness assessment and
review at different types of organizations.
Category: Research paper.
Keywords: quality management systems; adequacy; suitability; effectiveness;
efficiency.

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1 INTRODUCTION
Such terms as “adequacy”, “suitability” or “effectiveness” related to the quality
management systems have firstly occurred at the ISO 9001:2000 standard, but
without any remarkable or practical impact on these systems. The newest version
of this standard published in 2015 (ISO, 2015a) is more exacting in this area:
requirements regarding to the quality management systems adequacy, suitability
and effectiveness assessment or review are included minimally at two clauses:
a) “Top management shall review the organization´s quality management
system at planned intervals, to ensure its continuing suitability, adequacy,
effectiveness and alignment with the strategic direction of the
organization.” (cl. 9.3.1).
b) “The organization shall continually improve the suitability, adequacy, and
effectiveness of the quality management system”. (cl. 10.3).

Additionally, another requirement related to the quality management system

performance is repeatedly stressed at different clauses of this standard. When
consulting text of this standard in more detail, we are able to discover some
serious facts which can influence practical implementation or assessment of the
quality management systems against the ISO 9001:2015:
a) the ISO 9001:2015 takes use the terms “adequacy”, “suitability”
“effectiveness” or “performance” somewhat arbitrarily without
explanation of these terms with relation to the quality management
system,
b) the ISO 9001:2015 standard is not concerned with mutual relationships
among these terms at all, although these relationships really exist and play
important role in practice,
c) the ISO 9001:2015 standard ignores term “efficiency” related to the
quality management system although this quality management system´s
feature should be vital,
d) these three shortcomings can lead to different interpretation or
misunderstandings of all these terms from the point of quality
professionals and managers view,
e) but also internal and external auditors will be able to explain these terms
differently what can influence objectivity of all types of audits, including
third party audits performed by the certification bodies.

Therefore, the main goal of this article is to contribute to elimination of these

uncertainties by:

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• defining these terms,

• analyzing how these terms are perceived by quality professionals at
present,
• developing a set of steps within methodology focused on the quality
management systems adequacy, suitability, efficiency and effectiveness
assessment and review.

2 METHODOLOGY
To achieve defined goals of this article, a following methods and approaches
were used:
• a literature review, especially focused on terms as quality management
system adequacy, suitability, effectiveness and efficiency,
• a brainstorming conferences held with groups of quality managers and
quality technicians from Czech organizations with aim to reach consensus
regarding definition of key terms,
• an empirical field research how the terms as quality management system
adequacy, suitability, effectiveness and efficiency are perceived by
practice,
• obtained finding synthesis into methodology of the quality management
system adequacy, suitability, effectiveness and efficiency assessment and
review.

3 LITERATURE REVIEW
Unfortunately, it is not difficult to discover that such terms as quality
management system adequacy and suitability are not frequently discussed
throughout the world. Overwhelming majority of articles and books deals with
term „performance“ only. I can select from this majority following examples:
Hoyle describes how to perform the quality management performance review in
area of automotive industry (Hoyle, 2009). Oakland proposed a performance
measurement framework (Oakland, 2014) and both also recommend some steps
for quality management systems performance review, including performance
indicators. Gale has already argued that key performance indicator is customer
value (Gale, 1994). Neely, et al., 2010 proposed using a process approach
principle as a base for performance management system development. Set of
various key performance indicators was proposed by (Namešanská, et al., 2014).
Závadský and Hiadlovský searched answer to questions about various
performance indicators consistency (Závadský and Hiadlovský, 2014). And we
can remind also all books from Kaplan and Norton oriented to the Balanced
Scorecard methodology implementation – (Kaplan and Norton, 1996; 2006;

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2008) for example. This methodology can be used also within special parts of
processes. For example, (Bhagwat and Sharma, 2007) introduced their approach
to implementation of Balanced Scorecard methodology within supply chain.
Striteska and Spickova presented results of analysis and comparison the strong
and weak points of the most widely cited performance management systems
(Striteska and Spickova, 2012).
But unfortunately, there are only minimum resources where are terms as
“adequacy” or “suitability” discussed. We have discovered only two websites
which can be referred to mentioned terms: (MAS Solutions, 2015) and
(Whittington & Associates, 2015).
Such acute shortage of relevant resources made us to formulate and define key
terms ourselves.

4 DEFINING OF KEY TERMS

As it was mentioned above, the ISO 9000:2015 standard does not know such
terms as adequacy or suitability with relation to the quality management system
in spite of the ISO 9001:2015 standard requires the quality management systems
adequacy, suitability and effectiveness assessment and review. That was why we
had to define these terms first of all. We have inspired by websites (MAS
Solutions, 2015) and (Whittington & Associates, 2015), as well as by the
Random House Unabrigded Dictionary (Random House, 2002) on this purpose.
Now, we are able to put forward a propoal of following definitons:
Quality management system adequacy: is ability of this system to meet
applicable requirements, specified by the organization or standards. For
example, the requirements may be about the ISO 9001, contractual,
organizational or regulatory demands. Simply to say: adequacy means being
equal to the requirements, no more, no less.
Quality management system suitability: is capability or fitness of this system to
meet defined purpose. The organizations can identify various kinds of quality
management system´s purpose. To guarantee a maximum level of customer´s
satisfaction and loyalty, to support improvement culture at the organization or to
be a catalyst in the area of organization´s excellence should serve as example of
the quality management system´s purpose.
On the contrary, terms effectiveness, efficiency and performance are defined at
the ISO 9000:2015 standard by following way:
Effectiveness: extent to which planned activities are realized and planned results
are achieved.
Efficiency: relationship between the results achieved and the resources used.
Performance: measurable result.

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See also (ISO, 2015b). Let us have a look to these definitions. From the core
economic point of view, basic indicator of effectiveness is relation between
benefits and costs – see (Boardman, 2011) and many others. And practically: all
technical sciences associate the term “efficiency” with evaluation how a certain
capacity delivered to input of the technical system is successfully converted to
desirable outputs (Fried, Lovell and Schmidt, 1993) or (Hiltner, et al., 2002). As
to performance definition: what is measurable result of the quality management
system – that is a question! A number of certificates seem to be doubtful result, I
am sure. These notes make us to define these terms more preciously:
Quality management system effectiveness: relationship between the results
achieved by the quality management system and the resources used. We will
consider effective quality management system as system which brings
undoubtful economic or social effects.
Quality management system efficiency: extent to which planned activities within
the quality management system are realized and planned results are achieved.
Briefly, an efficient quality management system must be in rational operation.
Quality management system performance: extent to which quality management
system fulfils its functions and goals. By the way: author this term as well as
possibilities of this performance measurement has already described (Nenadal,
2016).
When giving all mentioned definitions thought we are able to come to the logic
conclusion: strong relationships must exist among all these quality management
features! We can depict this fact by Fig. 1.
What can we read from this figure? The quality management system can be
suitable and efficient, but this system need not be effective as a large amount of
various resources was wasted for example. All arrows illustrated in Fig. 1 can be
seen also as hypotheses which wait for future confirmation. Unfortunately, we
are not able to confirm these hypotheses at present as it asks for huge amount of
relevant data – and these data are simply unobtainable at Czech organizations
now.

5 RESULTS OF EMPIRICAL FIELD RESEARCH

As a part of special research project sponsored by VSB-TU of Ostrava we
performed an empirical field research in Czech organizations during January and

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Quality management Quality management

system adequacy system suitability

Quality management Quality management

system efficiency system effectiveness

Quality management system performance

Figure 1 – Mutual relationships among the quality management system´s

features

February 2016. A principal goal of this research was to investigate how the terms
as adequacy, suitability; effectiveness and efficiency (in relation to the quality
management systems) are practically perceived, used and assessed. 172
organizations from various areas of business were randomly selected. Data
gathering was based on structured questionnaire which could be filled
electronically. Additionally, interviews with some quality professionals were also
held. A response rate was 29,7 % what means that 51 organizations gave relevant
data for processing. Tab. 1 shows the organization´s distribution from business
area point of view.

Table 1 – Organization´s distribution from business area point of view

Business area Per cent
Automotive industry 19
Machinery 20
Metallurgy 4
Services 8
Chemical industry 10
Civil engineering 14
Food industry 4
Other 21

Of this sample, 49 % were large organizations, on the contrary, only 4 % were

organizations with less than 10 employees. 77 % of all organizations had
established and certified quality management system minimally against the ISO
9001:2008 standard.

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First of all, we launched above mentioned definitions of terms to all respondents

and afterwards, the quality professionals had to declare if they understand these
definitions. A proportion Yes (I understand it) versus No (I do not understand it)
is clear from Fig. 2 – 5:

Effectiveness
No
14%
86 %

Yes

Figure 2 – How the term “quality management system effectiveness” is

understood

Efficiency
No

29 %
71 %

Yes

Figure 3 – How the term “quality management system efficiency” is understood

Yes Adequacy

45 % 55 %

No

Figure 4 – How the term “quality management system adequacy” is understood

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Suitability No

55 % 45 %

Yes

Figure 5 – How the term “quality management system suitability” is understood

The respondents were also asked to describe what approach their organizations
apply for quality management system performance assessment: if this system is
assessed through individual features as adequacy, suitability, effectiveness and
efficiency (it is marked as Yes) or as a whole. Fig. 6 shows results.

70%

60%

50%

40%

30%

20%

10%

0%
Yes Only as a whole No at all

Figure 6 – Approach to quality management system assessment

The organizations which answered “yes” in this case were additionally asked to
list specific indicators used for quality management system adequacy, suitability,
effectiveness and efficiency evaluation. Analysis of these lists allowed us to
recognize that organizations take use wide range of indicators but most of them
are not relevant for quality management system features evaluation. For example:
we have occurred that indicators related to customer satisfaction or internal
auditing are used for evaluation and assessment of all features (such indicators
are about efficiency for one organization, while another organizations the same
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indicators apply in the field of adequacy, and so on). It is evidence that

understanding of discussed terms is little bit confusing in practice, in spite of
fact, that the same respondents declared sooner that these terms are fully
understandable for them!

We are able to summarize main lessons learned from this empirical study:
a) the organizations have not mostly a problem to understand terms
“effectiveness” or “efficiency” inversely against the ISO 9000:2015
definitions,
b) but 50 % of organizations or so have problems related to the terms
“adequacy” or “suitability”,
c) the most of organizations are not aware of fact that effectiveness,
efficiency, adequacy or suitability represents only a partial features of
overall quality management systems performance,
d) the approach to the quality management systems performance assessment
as a whole seems to be logic and rationale. On the contrary: such
information that 23 % of organizations do not generally perform this type
of assessment is strongly correlative of number of organizations without
quality management system certification,
e) quality professionals are mostly confused when assign relevant indicators
to such features of the quality management systems performance as
effectiveness, efficiency, adequacy and suitability really are.

Therefore we see as challenge all answers obtained to the last question within the
survey, focused on exploring if the organizations are interesting in special
methodology for quality management system´s adequacy, suitability,
effectiveness, efficiency and performance assessment: 89 % of all respondents
declared this concern without any hesitation as they perceive low level of
knowledge in this field on one hand and as important hindrance to objective and
fair quality management system assessment and review on the other hand.

6 FUNDAMENTALS OF QUALITY MANAGEMENT SYSTEMS

PERFORMANCE ASSESSMENT
Before anything else, we must identify set of indicators corresponding with
particular features of the quality management system performance. A proposal of
such set of indicators is presented by Tab. 2 – Tab. 5.

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Table 2 – Indicators for the quality management system suitability assessment

Quality management system Indicators related to
feature
• level of customer satisfaction
Quality management system
• level of customer loyalty
suitability as capability or fitness
of this system to meet defined • level of employee satisfaction
purpose. • number of improvement or innovation proposals
related to one employee
• level of customer value
• number of employees involved to improvement
teams related to total number of employees
• total amount of sales of new or innovated products
related to total turnover, etc.

Table 3 – Indicators for the quality management system adequacy assessment

Quality management system Indicators related to
feature
• results of all kinds of audits
Quality management system
• volume of nonconforming products related to total
adequacy as ability of this system
to meet applicable requirements, outputs
specified by the organization or • results of management system self-assessment
standards. • results of benchmarking
• input yield
• process capability indexes
• average response time to interested parties
requirements
• level of retained certificates successfully, etc.

Table 4 – Indicators for the quality management system efficiency assessment

Quality management system Indicators related to
feature
• prevention cost to total quality related cost ratio
Quality management system
• per cent of non fulfilled correction actions within
efficiency as an extent to which
planned activities within the required period of time
quality management system are • level of APQP (Advanced product Quality
realized and planned results are Planning) scheduled activities realization
achieved. • not fulfilled handed contracts to sales ratio
• volume of warranty claims or complaints related
to sales
• number of non conformities discovered by
customers to products sold ratio
• index of risk level change,
• extent of quality objectives fulfilment, etc.

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Table 5 – Indicators for the quality management system effectiveness assessment

Quality management system Indicators related to
feature
• return of quality management system investment
Quality management system
• internal failure cost to total cost ratio
effectiveness as relationship
between the results achieved by • external failure cost to total cost ratio
the quality management system • total quality related cost to total cost ratio
and the resources used. • value of key customers
• average profit from one quality improvement
project
• level of employees training effectiveness
• overall equipment effectiveness, etc.

The list of indicators presented by these tables must not be considered as

comprehensive set of course – it is only about examples! Various organizations
could be able to define some others indicators describing such features of their
quality management systems, as adequacy, suitability, effectiveness or efficiency
are. If we realize that all features describe also quality management system
overall performance, we look upon each of these indicators also as relevant
performance characteristic! Even though, correct assignment of indicators is
important, but not crucial part of the quality management systems performance
assessment. Therefore, let me introduce all general steps which seem to be
necessary to implement rationale performance assessment within establishing,
maintenance and improvement of the quality management system regardless the
type or size of the organizations:
1) The top management must define and communicate purpose, goals and
functions of the organization´s quality management system. Establishing
of quality policy, which is required by cl. 5.1 of the ISO 9001:2015 (ISO,
2015a), is not sufficient.
2) All managers of the organization must understand each area of quality
management system performance. It means that they have to see all
aspects of quality management system adequacy, suitability, efficiency
and effectiveness as useful and rationale and they must support
corresponding measurement and monitoring.
3) The top management must make a decision if the organization´s quality
management system performance will be assessed and monitored as a
whole, or within its particular features as adequacy, suitability, efficiency
and effectiveness. Any approach can be applicable; a choice depends
solely on the organizational environment.
4) Anyway, it is necessary to establish relevant set of indicators for each
quality management system performance feature. Tables 2 – 5 should
serve as possible inspiration. Management representative (or another
function) of the organization as well as process owners should approve
these indicators before releasing.
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5) Each of approved indicators must be described by mathematic formula.

All necessary responsibilities and authorities related to data gathering and
processing must be assigned to individual people. Such set of information
should be maintained through relevant documented information.
6) Top managers must develop efficient and effective ways of the quality
management system performance data reporting and communication.
Platform of so called management review, asked by the ISO 9001:2015 at
cl. 9.3 (ISO, 2015a) could serve as minimum on this purpose.
7) Top managers must ensure close link between management review actions
and continual improvement as I have already mentioned, cl. 10.3 of the
ISO 9001:2015 requires that the organization shall continually improve
the suitability, adequacy, and effectiveness of the quality management
system. And then: efficiency of implemented improvement actions should
be measured and monitored. A performance loop is closed!

7 CONCLUSION
I have mentioned some serious facts which can influence practical
implementation or assessment of the quality management systems performance
against the ISO 9001:2015 in the introduction of this paper. A confusing attribute
of the ISO 9001:2015 is hidden at clauses of this standard which require
assessment of the quality management system adequacy, suitability, effectiveness
and efficiency in spite of these terms are not defined at all or are defined
incorrectly. Therefore this article brings the own explanation of these terms and
on a basis of the empirical field research findings proposes fundamental steps of
all features of quality management system´s performance measurement and
assessment, including set of relevant indicators.
The main implications for various organizations are:
• the organizations can understand new requirements of the ISO 9001:2015
standard much easier,
• the organizations can see this paper as guideline for the quality
management system assessment and review based on facts,
• understanding of terms as adequacy, suitability, effectiveness, efficiency
or performance by organization´s managers and external auditors will
enable to reach mutual comprehension and eliminate possible conflicts,
• the paper should be seen as initial impulse for all who are interested in the
quality management systems development.
Opinions and proposals included to this article are expected to future refinement
of course.

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ACKNOWLEDGMENTS
This paper was elaborated in the frame of the specific research project No. SP
2016/91 which has been solved at the Faculty of Metallurgy and Materials
Engineering, VŠB-Technical University of Ostrava with the support of Ministry
of Education, Youth and Sports, Czech Republic.

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ABOUT THE AUTHOR

Prof. Ing. Jaroslav Nenadál, Ph.D., VŠB-Technical University of Ostrava,
Faculty of Metallurgy and Materials Engineering, Department of Quality
Management, 17. listopadu, Ostrava-Poruba 708 33, Czech Republic, e-mail:
jaroslav.nenadal@vsb.cz

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