Computer software: Projected annual growth, 1992-1994: 3%Imports from the U.S., 1992: $167 million
Household consumer goods Projected annual growth, 1992-1994: 0.3%Imports from the U.S., 1992: $100 million
Medical equipment: Projected annual growth, 1992-1994: 0.4%Imports from the U.S., 1992: $3 million to $4 million
*Source: "Hungary: Country Marketing Plan 1993,' U.S. and Foreign Commercial Service (202-482-4915).
ISO 9000: MAKING THE GRADE
By Leslie Brokaw
The first time Lori Sweningson heard the phrase ISO 9000 was back in October 1991, at an annual conference her Minneapolis company holds for its software users. "One of our customers asked, 'What are you going to do about meeting ISO 9000, those European quality requirements?' And I thought, Beats me.' But then Sweningson knew little about the European market, period. Her company, Job Boss Software, hadn't yet sold there, mostly "because I didn't know anything about it.' There certainly was no reason not to consider the possibility, though: founded in 1985, Job Boss makes software for small custom manufacturers to manage their shop flow, and with 800 customers, it had profitable 1992 sales of $2.3 million.
Inspired by the conversation, Sweningson went to a couple of seminars on international selling and in February 1992 attended a matchmaker trip, sponsored by the Department of Commerce, to France and Belgium to scope out overseas distribution opportunities. The more people she came in contact with, "the more ISO 9000 kept coming up. The word was that to trade in the European economic community, manufacturers were going to need to prove their processes met minimum quality standards.'
Like many people running U.S. companies, Sweningson already was fluent in quality lingo: she has embraced the theories of total quality management (TQM), is applying for a Minnesota Quality Award (which she doesn't expect to win but does expect to learn from), and plans on one day going for the Malcolm Baldrige citation.
But ISO was unfamiliar. An acronym for the International Standards Organization, ISO is the newest quality to-do bubbling within manufacturing circles. Spawned in Europe, ISO aims to promulgate quality standards for companies to meet as a way of showing that the methods they use in product development and testing ensure quality end products. (See "ISO at a Glance,' below.) Unlike TQM or other internal quality programs, ISO requires certification by a third party. Among many large European businesses, ISO is becoming a kind of Good Housekeeping Seal of Approval, increasingly being required of both European and U.S. suppliers.
The more Sweningson heard, the more she thought ISO made "tremendous sense' from marketing and quality-discipline points of view. "The whole idea is to get to where you could take a person out of the process, and the process would continue because of the habits of the organization,' she says. That tenet of quality management is one she'd already been pursuing, and ISOmade it all the clearer. After looking into ISO over the summer, deciding that she would need the designation to sell in Europe, and weighing the amount of time it would demand from people at her company, Sweningson ultimately took the plunge and committed last fall to undertaking the yearlong certification process. Her goal: ISO certification by the end of 1993.
Because ISO is just beginning to move beyond its initial buzz here in the States, Sweningson is finding that working toward certification is a bit like inventing the wheel -- but it's to her advantage. "One big reason to do it right now is that the system is still embryonic, and there are more issues subject to interpretation,' she says. "The requirements are definitely easier than they're going to be in a couple of years.'
Her first step toward ISO certification was to begin preparing an extensive quality manual. Job Boss hired a consultant to help put together a paper trail documenting each step in how the company designs and tests products and gets customer feedback. (See "So What's Involved, Anyway?' below.)
Writing the manual over the next several months should be fairly straightforward; a set of printed guidelines supplied by ISO -- for a software company, that would be form 9001-3 -- tells exactly what the company has to account for.
Explains Sweningson: "There'll be a section titled 4.1.2.1' -- the minutiae of subsections is prodigious -- "which deals with authority, and under A we'll write, This is how they initiate action. Under B we'll write, This is how they record any quality problems. And so on. We'll take every one of these tiny sentences and blow them up to several paragraphs.'
The next step will be submitting the document to an ISO-certification auditing firm, which must approve the paperwork and then make an on-site visit. There are accredited U.S. firms, but for added credibility in Europe, Job Boss is looking into using a Belgian firm, Bureau Veritas Quality International. (BVQI has an office in Jamestown, N.Y., and has already certified another Minneapolis software company.) Job Boss vice-president of customer service Marlene Walsten, who currently spends about half her time heading up the ISO effort, estimates that 80% of the steps Job Boss needs for certification already are in place. "Really, the key is understanding the specs of what the auditors want,' she says. "When the form states 'Your quality policy must be visible,' does that mean everyone has to have a copy at his or her cubicle? That it's on the reception-area wall? That it's included in your quality manual?' Walsten is counting on the consultant, Jolene Hart, a senior partner with Software Quality International, in Minneapolis, to help interpret the sometimes-vague directions of the guidelines.
The process doesn't come cheap. Sweningson has budgeted $30,000 to $50,000 for out-of-pocket consultant and auditor fees. And steaming toward ISO may be overwhelming for Job Boss's 40 employees, who already are busy enough running the company, let alone ruminating on how they do it. "On the face of it, it's almost contrary to all the '90s things, where you're empowering your employees to make their own decisions,' concedes Walsten. "But part of the guidelines say that if the customer's needs have to be met in a more efficient way than how you've documented, you do that. You make that flexibility explicit in the manual.'
Job Boss is banking on the payoffs' being broad. The most obvious benefit is that ISO certification should have cachet as a marketing tool both in foreign countries and in the United States. In addition, 20% of Job Boss's revenues come from consulting services, and Sweningson figures the company will add the ISO experience to its offerings. And she truly believes that ISO will fast become a minimum requirement for many sales.
