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1 INTRODUCTION

Management of construction companies are focusing on

quality issues as a competitive edge. Delivering pro jects that

satisfy client requirement has become a main priority in

maintaining good business relationships. Hence, the

construction industry should develop a common standard in

every stage of construction process. The International

Standardization for Organization has been formed to

promote the development of standardization, therefore the

acceptance of ISO standards in the construction industry

should be widely implemented in order to achieve high

quality product in every stage of construction process

(Youcef, 2006).

The construction industry has embraced the ISO 9000

standard since its inception. The Quality Management

standard is becoming the benchmark for successful

construction companies. The discipline and systematic

approach has helped many companies to structure their

management and processes to consistently meet the client’s

requirements. The revised ISO 9001:2008 standard places

greater emphasis on customer needs and expectations and

improving business performance and is now easily applied

to a construction companies operations. The implementation

of QMS in the Construction Industry is meant to assist the

industry to improve the efficiency and effectiveness of the

organization management system in ensuring successful

objectives of company (Said, etal, 2009).

According to Mohammed & Abdullah (2002), QMS is the

interaction of people, process, and documentation to meet

the customer’s stated and implied needs. The result would be

a reduction in inefficiencies and waste, improved work

practices, increased morale o f the management team, and the

opportunity for a greater market share.

There are at least 2,536 listed construction companies in the

Philippines as of 2009, out of which 2,409 belongs to the

Micro, Small and Medium Enterprise or better known as the

MSME’s (Industry and Trade Statistics Department, 2009).

SMEs play a crucial ro le In the development of the

Philippine economy. They represent 99.6 percent of all

businesses registered in the country and employed 70

percent of the total labor force. In addition, they account for

32 percent of the country’s gross domestic product (GDP)

(Leano, 2006). In China, the SMEs are the core of the

construction industry development and play main ro le in the

urban and rural building (Yuping et al., 2006).

There is still no specific data or informat ion regarding the

present condition on the implementation of ISO 9001:2008

in the construction industry in the Philippines, moreover to

the SME construction firms in the CALABARZON area.

1.1 Research Problem and Objectives The main objective of th is study was to develop a step-by-

step guideline in implementing ISO 9001:2008 for the small

and medium enterprise in the construction industry. This will

assist them in attaining its objective o f implementing quality

construction projects at stated period of time and min imum

cost.

2 REVIEW OF PERTINENT LITERATURE Quality Management Systems (QMS) is the interaction of

people, processes, and documentation to meet both

customers’ stated and implied needs. The result would be a

reduction in inefficiencies and waste, improved work

IMPLEMENTING ISO 9001:2008 IN THE CONSTRUCTION INDUSTRY:

A GUIDELINE TO THE SMALL AND MEDIUM ENTERPRISE (SME)

CONSTRUCTION FIRMS IN THE PHILIPPINES

Joseph Berlin P. Juanzon, PhD1 and Manuel M. Muhi, PhD2

1 Civil Engineering Department, Mapua Institute of Technology at Laguna, Malayan Colleges of Laguna, Pulo Diezmo Road,

Cabuyao, Laguna 4025 Philippines , Email: jbpjuanzon@mcl.edu.ph

2VP Research and Development, Polytechnic University of the Philippines , Sta Mesa, Manila

Email: manuel_muhi@yahoo.com

Abstract : The implementation of ISO 9001:2008, Quality Management System in the construction industry is now an

ongoing trend, more so in the Small and Medium Enterprise or the SMEs in the Philippines. Clients are now requiring the

construction industry to adopt a quality management system that will ensure them that the projects are completed with in the

constraints of the best quality, stated period of time and min imum cost possible. The main objective of this research is to come

up with a step-by-step guideline in implementing ISO 9001:2008 for SME-based construction firms in the Philippines.

Key words : ISO 9001:2008, Quality Management Systems (QMS), Small Medium Enterprise (SME).

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practices, increased morale, and opportunity for a greater

market share (Mohammed & Abdullah, 2002).The Quality

Management System for the Construction Industry is a

systematic approach for the companies who want to develop

and establish a quality system. The QMS gives guidelines to

the introduction, structure, and contents of quality systems

for the use of all part ies involved in the construction industry.

Plan and building authorities, clients, architects, engineering

consultants, contractors, subcontractors, factories and

suppliers have adopted the system.

Through the use of the QMS, the build ing industry will

achieve a surer and better communication. The system has

through the years, been adapted for use abroad. Up to 1995,

QMS has been introduced and further developed in five

European countries (Sjøholt & Berg, 2003). The

implementation programme - the Five Step Model as shown

in Figure 1 is an effective tool for quality management.

Figure 1 Five Step Model for implementing QMS

According to the original 1987 bulletin from the

International Organization for Standardizat ion (ISO), ISO

9000 is "a series of international standards dealing with

quality systems that can be used for external quality

assurances purposes." The ISO was founded in 1946 to

develop international quality standards to facilitate

worldwide trade and help Western countries regain their

competitiveness. The organizat ion consists of a coordinating

group of members from more than 90 countries. The U.S.

representative is the American Nat ional Standards Institute

(Barnes, 2000). Figure 2 shows the framework of ISO

9001:2008 based on Deming’s and Shewart’s cycle better

known as PDCA (Plan, Do, Check, Act) cycle.

The acceptance of ISO 9000 standards in the construction

industries is not as wide as in other industries such as

manufacturing. There are special features in the construction

industry that limit the implementation of the ISO 9000

standard. One of these features is that a construction project

is usually a unique collection of people, equipment, and

materials brought together at a unique location under unique

weather conditions, while most manufacturing is a system of

mass production wherein all of these factors are consistent

with producing typical products over and over again (Phenol,

1994).

Figure 2 ISO 9001:2008 Framework

Micro, small, and medium enterprises (MSMEs) are defined

as any business activity/enterprise engaged in industry, agri-

business/services, whether single proprietorship, cooperative,

partnership, or corporation whose total assets, inclusive of

those arising from loans but exclusive of the land on which

the particular business entity's office, plant and equipment

are situated, must have value falling under the following

categories: By Asset Size, Micro : Up to P3,000,000; Small:

3,000,001 - P15,000,000; Medium: P15,000,001 -

P100,000,000; Large: above P100,000,000.

Based on the study conducted by Philippine Institute for

Development Studies, Small and Medium Enterprises

(SMEs) have played an important role in industrial

production in particular, and economic growth in general in

less developed, developing, and transitional economies

worldwide. They have generally provided the bulk of

entrepreneurs and employment in these economies, and the

necessary foundations for sustained economic growth and

rising incomes.

The SMEs are the core of the construction industry

development and play a main ro le in the urban and rural

building. With the professional subdivision, the increasing of

professional ability and the improvement of project sub-

contract system in the construction industry, the roles of the

Industry Cluster of SMEs will become more and more

obvious, including stabilizing economic development,

enlarging employment rate in the towns, and promoting

technology innovation (Liao Yuping, Yao Bing, 2007).

3. IMPLEMENTING ISO 9001:2008

Before an SME-based construction firm be able to

implement ISO9001:2008 in their organization, they must

first understand the eight quality management principles on

which the quality management system standards of the ISO

9000 series are based. These principles can be used by

senior management as a framework to guide their

organizations towards improved performance.

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Principle -1 Customer Focus

Organizations depend on their customers and therefore

should understand current and future customer needs, should

meet customer requirements and strive to exceed customer

expectations. The key benefits on this princip le are (1)

increased revenue and market share obtained through

flexib le and fast responses to market opportunities, (2)

increased effectiveness in the use of the organization’s

resources to enhance customer satisfaction, and (3)

improved customer loyalty leading to repeat business.

Principle -2 Leadership

Leaders establish unity of purpose and direction of the

organization. They should create and maintain the internal

environment in which people can become fully involved in

achieving the organization’s objectives. With good

organization leadership, (1) people will understand and be

motivated towards the organization’s goals and objectives ,

(2) activities are evaluated, aligned and implemented in a

unified way, and (3) miscommunication between levels of an

organization will be minimized.

Principle -3 Involvement of people

People at all levels are the essence of an organization and

their full involvement enables their abilities to be used for

the organization’s benefit. Involv ing people in the

organization will result to (1)mot ivated, committed and

involved people within the organization, (2) innovation and

creativity in furthering the organization’s objectives , (3)

people being accountable for their own performance, (4)

people eager to participate in and contribute to continual

improvement of the system in the organization.

Principle -4 Process approach

A desired result is achieved more efficiently when activ ities

and related resources are managed as a process. A well

define process approach will result to (1) lower costs and

shorter cycle times through effective use of resources , (2)

improved, consistent and predictable results , (3) focused and

prioritized improvement opportunities.

Principle -5 System approach to management

A systematic approach in management will help identify,

understand and manage interrelated processes as a system

which contributes to the organization’s effectiveness and

efficiency in achieving its objectives.

Principle -6 Continual improvement

Continual improvement of the organization’s overall

performance should be a permanent objective of the

organization. The key benefits in continual improvement of

the organization are (1) performance advantage through

improved organizational capabilities , (2) Alignment of

improvement activ ities at all levels to an organization’s

strategic intent, and (3) flexib ility to react quickly to

opportunities.

Principle -7 Factual approach to decision making

Effective decisions are based on the analysis of data and

informat ion. Wrong informat ion will definitely lead to a

poor management decision, therefore and efficient access to

factual information will increase ability to demonstrate the

effectiveness of past decisions through reference to factual

records.

Principle -8 Mutually beneficial supplier relationships

An organization and its suppliers are interdependent and a

mutually beneficial relat ionship enhances the ability of both

to create value. It also enhances flexibility and speed of jo int

responses to changing market or customer needs and

expectations and optimization of costs and resources.

4. CONCLUSION AND RECOMMENDATION

The following recommendations have been formed for

effective implementation of ISO 9001:2008 QMS in

construction firms:

1. Creation of Quality Policy

The top management should establish a quality policy that

should be in-line with the needs of the organization and its

clients. The policy should include a commitment to meet ing

requirements as well as continual improvement. It must e

clearly understood by everyone in the organization and kept

under review by top management for on-going suitability.

2. System Procedures

Manage implementation of system that supports the core

process. System procedures help create the right

environment for quality by supporting, directing and

continually improving the business process. These include

procedures for the control of document and records,

recruitment, training, control of non-conformances, auditing

for effect iveness, preventing the occurrence and recurrences

of non-conformances, measuring client satisfaction and

improving the system.

3. Process Procedures

The process procedures describe how the core processes are

managed. They are useful to define the business cycle which

from the client’s needs and stop once the project is

completed. It also helps to manage and measure value that is

added to achieve client satisfaction. Core processes of a

contractor are captured in the process procedures to achieve

consistent operations in meet ing client requirements.

Contractors are also required to set-up a project quality plan

for each project to be able to customize the relevant

procedures as necessary.

4. Documenting a Quality System

Documents are information and its supporting medium. The

ISO9001:2008 standard does not specify how a quality

management system should be documented. The level and

number of documents needed in a contractor’s system will

largely depend on the size and structure of the organizat ion

itself. To further ease the documentation and implementation,

the system and process procedures can be flowcharted to

show who does what, when and how as shown in Figure 3.0

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and Figure 4.0 of Appendix 1. These procedures will also

provide a link to the forms, checklists and method

statements in the organization.

ACKNOWLEDGMENT

The Authors would like to acknowledge the members of

committee of the Inter-Specialty Group especially to its

chairman Mariano R. A lquiza, to Engr. Eustaquio T. Coronel,

Jr., chairman, Pro ject Management and Construction

Engineering Specialty Div ision and of course to the

incumbent President of PICE National Engr. David Sanchez

for giv ing us this opportunity to present this paper in the 40th

PICE National Convention.

APPENDIX 1.0 QMS MODEL

Figure 3.0 QMS Model Part A

Figure 4.0 QMS Model Part B

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