by Richard Saul

The topic I have chosen for discussion is auditing leadership and commitment. I am going to make the following qualifiers before I start:

• For the purposes of this discussion, my definition of “uncommitted” organizations are those who are registered to ISO 9001 and leaders don’t appear to be using that standard to its fullest capacity.
• This does not imply there is any lack of commitment to the success of the business itself. I am only referring to the role their QMS program plays in it.

Commitment can be defined as “dedication to a cause.” The “cause” may be something larger than yourself—something that will lead to the existence of a desired future state. A cause can be described, visualized, or documented.

Sporting analogies are always good, because the cause is easily identified. A vision of yourself standing on the podium, crossing the finish line, breaking a previous record. Commitment to that cause is what you will do to achieve this. The time spent away from home to attend training camps, eliminating things you love from your diet, the sacrifices your family has to make…

Or a political campaign. All those volunteers, contributing their own time, stuffing mailboxes, putting up billboards, knocking on doors, often taking some abuse in the process. That’s commitment.

And each cause needs a leader. An icon, a person who embodies the cause. And, that icon must possess the ability to inspire commitment to the cause.

The leader needs a plan. Without a plan, the methods used to achieve the objective tend to become random actions with no interconnection.

Once the event has passed, regardless of the results, the cause evaporates. Unless the cause has been redefined, like a new competition, a new campaign or even achieving a business objective, there is no reason to commit to anything. After all, once it’s all over what’s the point?

In that way leadership and commitment are intertwined. You can have a worthwhile cause, but without leadership it will struggle to get off the ground. Or you can you can have an inspirational leader, but without a cause there is nothing to be committed to.

So how does that translate to businesses and more specifically their leaders? Most business leaders have a “cause”, although they probably wouldn’t describe it as such. You might see it as a vision or mission statement. And it is a rare organization that cannot produce strategic or business plans.

Yet, some organizations seem to struggle to fulfil their cause. I’ll give you two examples from my own experience. The first was a company in the public sector I audited many years ago. Their vision at the time was to become “world class.” They had a strategy, which was to follow the Malcolm Baldrige criteria and they had a definition for success—receiving a quality award, which would validate their achievement.

As it happened, 10 years later I was asked to audit the same company. Their vision had remained the same and in theory so had the approach, but 10 years later they had not made any progress toward winning the award they sought.

The second example was a company in the private sector. It had a goal to have a defect rate below half a percent. They had maintained good records going back several years, so it was easy to track their progress. Results year after year hovered just above the goal, but never reached it.

In both cases, there was no evidence of a lack of commitment. In fact, in the first example, on the day I arrived, 10 years later, the organization was holding a “world-class day.” Slogans were on display and there was a list of topics to be discussed. The staff I talked to seemed to be genuinely committed to that “cause,” although I might add any staff from my original audit had long since departed and top management had changed three or four times.

In the second instance, attempts to reach the objective of less than half a percent was well understood and there appeared to be some commitment to reducing the rate and yet the goal continued to remain elusive.

On the surface there appeared to be no common element between the two organizations. They are two very different companies with different approaches to establishing their “cause.” The only common element was they were not able to achieve their stated definition for success.

In this digital age, information can come from many sources. I located a clip on YouTube from the late Dr. Russell Ackoff—one of the pioneers of systems thinking—giving a talk at the University of Cincinnati. During the clip, Dr Ackoff talked about two independent studies—one by Arthur D Little, the other by Ernst and Young. In each case, 3,000 leaders from organizations were asked to comment on their satisfaction with the results of quality programs they had authorized. More than two-thirds of the managers who had ordered these programs considered them to be failures.

Dr. Ackoff’s conclusion was this: He was confident there was nothing wrong with the programs themselves. After all, he said, quality is a good thing. So, he argued there must be something wrong with the way people are trying to pursue it.

The common thread for both my examples is that both organizations seemed to care enough. After all, who doesn’t want to succeed? The roadblock was that they didn’t have the knowledge they needed to use the quality programs effectively to achieve the results they wanted.

As auditors, we have that knowledge. We live and breathe the standard every day. We’ve seen it applied to many organizations over time. We have seen what works and what hasn’t. I also believe we care about the success of our clients. I say that because during my career as an auditor, I’ve never met an auditor who didn’t care. What I have seen, however, is that some auditors struggle to communicate their knowledge in a way that will result in the auditee considering changing their behavior.

How should we, as auditors, communicate the benefits of using the standard to leaders who on the surface may appear to be uncommitted, especially when they may not even be present? I am going to make another assumption here. Regardless of the level of their participation, top management will read the audit report. If they were not present, the report will be their primary source of information. Which means if we can influence their behaviour at all, it will have to originate from that report. Here are two examples of how I have approached this.

Over time there have been a few organizations where I have never actually had a real conversation with the CEO. They have never participated in the audit process, didn’t attend opening or closing meetings, and were often out of town or country when third-party audits were scheduled. When I questioned staff about the absence, the response was along the lines of: “We have been entrusted by the CEO to oversee the quality program and we can answer any of your questions.”

Does that mean top management was not committed? Not necessarily. While the standard may require top management to be accountable for audit outcomes, it does not automatically follow that their absence proves a lack of commitment. There’s nothing in the standard that says top management must be present for third-party audits. In fact, the standard doesn’t mention third-party audits at all.

Until I see evidence to the contrary, I am going to take these representatives at their word—that anything I need, I can get from them. But they have made a declaration and I am going to test that.

So, my questions for these representatives will be exactly the same as if I were talking to the CEO, starting with a request for their board papers. If they can be provided, we can then go through them in detail, where I will ask for their comments on any particular points of interest, and follow up with the setting of objectives, their strategic plan, and so on.

If those nominated representatives—individually or collectively—were able to provide all the information requested, could speak intelligently and with authority to any questions asked, and I could make conclusions based on what they provided, then yes, the CEO’s claim that he or she has “good people” running his or her quality program has been validated.

If, on the other hand—as I would suspect—I could not be provided with the information needed, I would make sure the auditee realized that perhaps their original declaration on behalf of the CEO needed some review. I need to do this because, while I may not be there when the report is read by the CEO, they will be, and there is a high probability that they will be questioned on what happened and why a nonconformance was raised. It is at that moment I will need them to corroborate my findings.

The wording of the report is important. It might start with the following introduction: “Due to the absence of key personnel, the following information could not be provided.” Then I would bullet point each example of where I couldn’t get what I needed. The combination of the contents of the report, along with support from the relevant staff, will hopefully send a strong signal to the CEO that it would be in their best interest to make themselves available during the next audit. You can be sure that when I create that audit plan, it will include time for a one-on-one with them.

The second example I want to share are situations where top management may be on site and has participated in the audit process, but their knowledge of how to use the standard effectively could be improved.

Organizations tend to focus on their core business. By that, I mean money-generating activities. Areas like production schedules, availability of raw materials, and staff shortages. Because of that focus it will be unusual to find any gaps in those areas.

The corollary to that is that there may be less focus in supporting areas. Areas such as document control, the internal audit program, change management, retention, and transfer of organizational information and internal communication. The lack of that focus could result in undiscovered themes which lie dormant, just waiting for the right conditions to surface.

In my experience, there are generally one or two main areas of weakness in each organization. I’ll also venture to add that if we dig deep enough, most of any non-conformances we raise will relate back to those weak areas in some way.

For uncommitted organizations, the best opportunity to bring those areas to the CEOs attention is through the report—mainly because it might be our only chance to reach them. So, seeing as we are writing it for them, we need to know how they think. Here are some of the characteristics I have identified, based on my experience:

• They need a headline: CEO’s are big-picture thinkers and are less likely to continue reading if the report is filled with information that is too detailed and can be addressed at lower levels.
• They will want evidence to support that headline—so provide examples of that evidence, maybe three or four bullet points.
• They will want clarification of what risk this presents—so make sure you have included it.
• If they remain doubtful, they will most likely seek collaboration by staff who were present.

If we can include all of that, I believe top management will more likely to act on those findings, non-conformance or not. If this reporting style continues, they may well will look forward to your next report. Sooner or later they may show up.

Which means if we are going to “sell” a finding to a CEO, we not only have to identify individual gaps, but connect them to a theme, then link the theme to a business risk, all the while making sure you have had your observations witnessed by a staff member who will support your findings.

I am a fan of using stories to illustrate a point. These stories often relate to domestic situations that have some allegorical connection. And they often include my wife, Roberta. She knows I do this and she often proofreads my discussion papers. I take that as tacit approval to continue. This one is about house hunting.

Many years ago, my wife and I were considering the possibility of moving and went to a series of open homes. We looked at the usual things: cracks in the wall, water marks, the size of the rooms, plumbing, etc. When we walked out we compared observations. Roberta then turned to me and said: “I think these people are in over their head financially.”

“How could you possibly know that?” I asked.

“Many of the clothes in their closet were showing signs of wear—like the cuffs of the pant legs were frayed and the socks in the laundry basket had been darned. The linen on the beds were well worn, pieces of the crockery were chipped but still being used. The guy had a desk in his office where the repairs had been done by an amateur. Oh, and I saw an overdue bill at the back of that desk.”

Individually each of those findings were legitimate, but what did that have to do with the overall mission, finding a suitable house?

In my view there were two themes identified, both relevant to the overall mission. First, as my wife rightly pointed out, was the homeowner could be open for an offer. But the second possibility—the more important theme discovered—was what if she was right about their financial situation? Did that apparent jury-rigged approach to repairs in the house extend to the maintenance of the house itself? That was the headline. The latent risk was that while  the individual symptoms were all visible, unless you connected them to a common theme the individual items would be managed at lower levels, flying below the CEO’s radar, until as I mentioned the right conditions showed up.nIf you include themes like that in your report, he or she is more likely to read the next one. And the next step you’d hope to see was an increase their presence during third-party audits.

Things always become clearer when you present an argument in written form. Here is what I learned in the process and hopefully, you will have received some benefits from it:

• Quality programs are sold as a tool for increased performance.
• In many cases this are requirements, either from the company board, or an industry.
• If we believe the results from Dr. Ackoff’s talk, about two thirds of the managers that ordered these programs failed to see the value (i.e., investment vs. results).
• As a consequence, their commitment starts to wane.
• As auditors we have the ability to provide guidance on how to use the tool.
• While we cannot tell them what to do, we can, using some of the techniques I described above—provide them with examples of how to use the tool more effectively and thus increase their ability to achieve their objectives.

I hope that sharing some of my experiences has been of benefit.

 

About the author

Richard Saul is an Exemplar Global-certified Lead Auditor and skills examiner for quality, environmental, and health and safety programs. During his career, he has conducted more than two thousand audits in Australasia, Korea, China, and India. He became a registered auditor with the China Certification and Accreditation Association in 2012. He has provided auditor training since 2006 and trained dozens of auditors over that period. On two occasions, he was a National Evaluator for the New Zealand Business Excellence Awards program. This experience has evolved into the delivery of consulting services, which he has offered since 2011.

As well as publishing numerous articles, Saul has been a speaker at three World Quality Congresses, both in New Zealand and Canada. He holds a Master of Management degree and a Graduate Diploma in Business, both from the University of Auckland.