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How ISO 9001 can increase your ROI

Many service, distribution and manufacturing organisations find meeting quality requirements consistently costly. So it makes sense to implement ISO 9001 NZ right across your organisation. It increases your quality performance and saves money on your bottom line.

A Quality Management System (QMS) helps lower expenses which increases profits. Investing in a quality system makes your company attracts more customers. Focusing on quality encourages customer loyalty which gives you a competitive edge. A QMS lowers your expenses by:

  • Reducing the need to carry inventory so you do not need so much working capital.
  • Streamlining processes and procedures which lowers your production costs.

Your return on investment (ROI) in quality will outweigh the costs of implementing and maintaining a QMS.

 

What is quality costing you?

It is natural to want to know if a QMS is cost-effective. First you need to assess what quality costs you:

  • Cost of prevention. How much do you spend on preventing recurring quality problems? This can include the cost of creating procedures and processes, quality plans and training.
  • Cost of appraisal. How much do you spend on measuring and monitoring activities to achieve consistent quality across the company?
  • Cost of internal failures. What are internal failures costing you? This includes scrapping and reworking a product, and the time and labour spent replacing products.
  • Cost of external failures. Cost of external failures includes warranties and loss of business.

The cost of preventing quality issues is a lot less than dealing with customer complaints. But you probably already know this. Poor quality products and services cost your organisation 10 times more to deal with once it reaches your customer than it does to prevent the issue in the first place.

 

ISO 9001 benefits

The following are just a few of the financial benefits of a QMS:

  1. Reduces manual processes which reduces human error and increases employee productivity.
  2. Access to real-time reporting. This allows you to make more informed decisions which means less overall downtime.
  3. Improved processes and efficiency means higher productivity.
  4. Consistent quality control across the whole organisation. This reduces defects, mistakes and customer complaints.
  5. Increased customer satisfaction which boosts sales and business opportunities.

Understanding and measuring what quality costs you allows you to see how spending more on prevention and appraisal helps reduce costs. Spending more in advance implementing a QMS lowers the cost of poor quality. Understanding all this helps you can calculate your ROI.

Our specialists understand quality and how you can use a QMS to get the best out of your business. Contact us today to find out how ISO 9001 can increase your ROI. We are passionate about helping businesses grow too their full potential using ISO certification.

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