practical auditing

PRACTICAL AUDITING

Continual Improvement Program for Internal Quality Auditors

By Sid Calayag

Agenda

• PDCA and Process Approach

• Interview/Question Technique

• Notes, Check List & Cheat Sheet

• Report Writing

• Toughest ISO 9001:2000 Clauses

• How to Audit Difficult Clauses

• How to Audit Undocumented Process

• Auditor’s Code of Ethics

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Warm-up Exercise

The exercise will be used to gauge your present knowledge must be completed in 10 minutes.

Countdown starts now. . .


4

Process Based Approach

MANAGEMENT RESPONSIBILITY

RESOURCE MANAGEMENT

MEASUREMENT, ANALYSIS & IMPROVEMENT

PROCESS INPUT OUTPUT

C

U

S

T

O

M

E

R

P

D C

A

PRODUCT REALIZATION

Satisfaction

C

U

S

T

O

M

E

R

Requirements

THE PDCA CYCLE

PLAN

CHECK STUDY

DO

IMPLEMENT

VERIFY

ACT EVALUATE

VALIDATE

Interview and Question Technique

• Interview • Reason • Steps

• Question Techniques • Closed-ended Question • Open-ended question • Show-me Question


Interview Reason

• Supplements the documented process

• Determines the actual defined process

• Principal way of obtaining information

• Allows auditee to explain work practices

• Ascertains understanding and commitment

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Interview Steps -1

• Interview persons at their workplace

• Conduct interviews during normal hours

• Put person at ease (lower anxiety level)

• Explain your purpose (what you want)

• Ask about their job (question; observe)

• Verify responses (confirm understanding)


Interview Steps - 2

• Check the facts (use other sources)

• Record evidence (notes on checklist)

• Make tentative conclusion (no secrets)

• Give opportunity to discuss other topics

• Thank for their time and cooperation


Summary on Interview

• Remember, it is an interview, not an interrogation!

• Investigate a claim; accept an admission.


Questioning Techniques - 1

• Ask question and then actively listen

• Rely primarily on open-ended questions

• Avoid closed question (except to confirm)

• Ask for explanations and examples

• Rephrase your question for clarification

• Restate answer for your understanding

• Keep neutral; don't disagree or interrupt


Questioning Techniques - 2

• Ask "suppose" or "what if" questions

• Find basic flaws with simple questions

• Ask the blunt question about quality

• Nod in agreement to maintain dialog

• Use silence for expanded responses

• Observe unguarded facial expressions

• Learn from remarks of nearby people


Close and Open-ended Question

• Open-ended question can be used in determining the actual process during the interview.

• Close-ended question can be used to conclude the result of the interview.


Sample

Summary on Questioning Techniques

• STOP TALKING - LISTEN

Do not ask closed questions unless to conclude item

Maintain a 20% talking : 80% listening ratio

• USE THE SIX HONEST SERVING MEN

“I keep six honest serving men

They taught me all I knew

Their names were WHAT and WHY and WHEN

And HOW and WHERE and WHO”

(The Elephant Child - Kipling)

• SHOW ME

Notes, Check List & Cheat List

• Taking Notes in an Audit

• Check List

• Cheat List


Taking Notes in an Audit

• One use of a checklist is as a repository for your notes

• Take brief notes on what you have read, heard, and seen

• Capture specific references

• record what people are telling you about their practices

• Some of your notes will be used immediately for your next line of questioning


Check List

Requirements for check list

• Standard requirement

• Customer requirement

• Organizational requirement

• Legal requirement


Advantages on Using Check List

Checklists, if developed and used properly:

• Promote planning for the assigned audit

• Ensure a consistent audit approach

• Act as a sampling plan and time manager

• Serve as a memory aid and confidence builder

• Provide a repository for notes on evidence


Drawback on Using Check List

Drawback

• May result in poor coverage.

• Restrict interview questions

• May cause the auditor to use an outdated tool if not updated according to the new standard


Summary on Check List

• A checklist should guide auditors through the system flow from quality policy, to objectives, to processes, to measurements, to results, to actions, and eventually to continual improvement.

• Auditors should use the checklist as a planning tool for their assignment and be willing to pursue other areas of investigation.


Cheat Sheet

• A "cheat sheet" is a concise set of notes used for quick reference

• Job notes may not accurately describe the tasks, in conflict with written instructions, or unapproved by management.

ISO 9001:2000, clause 4.2.3 states that "Documents required by the quality management system shall be controlled." So, if cheat sheets are needed by employees to carry out their activities, these would be viewed as documents that must be controlled.


Report Writing

• Use CPLANES as a reminder • C – Clause • P -- Procedure or Instruction • L -- Location • A – Activity • N – Nature of Deficiency • E – Evidence • S – Scale of Deficiency


Writing Nonconformity Reports

• Conformity,

• Conformance, or

• Compliance?


Exercise No. 1

How well do you know the new ISO 9001:2000 standard? Can you identify the clauses for these requirements?

1. Reviewing the system at planned intervals

2. Identifying the status of product measurements

3. Maintaining process equipment

4. Handling, packaging, and storing products

5. Preventing the "recurrence" of nonconformities

6. Maintaining evidence of conformity of acceptance criteria

7. Ensuring requirements are complete and unambiguous

8. Identifying the control of outsourced processes

9. Planning for design review, verification, and validation

10. Including a quality manual in the documentation

24 Auditor Training rev 0 022009 answer

Toughest Requirements

• 4.1 General Requirements

• 5.1 Management Commitment

• 5.4.1 Quality Objectives

• 5.4.2 Quality Management System Planning (vs. 7.1 Planning of Product Realization)

• 7.3.1 Design and Development Planning


Toughest Requirements

• 7.5.2 Validation of Processes for Production and Service Provision

• 8.2.1 Customer Satisfaction

• 8.5.1 Continual Improvement

• 8.5.3 Preventive Action


Most Common Audit Findings

* Internal Audit Findings • 1. Customer satisfaction data and assessment (8.2.1 . . .

• 2. Documentation gaps (4.2.3 . . .

• 3. Continual improvement process (8.5.1 . . .

• 4. Objectives not measurable (5.4.1 . . .

• 5. Collection and analysis of data (8.4 . . .

• 6-7. Top management commitment and responsibility (5.4 . . .

• 6-7. Record keeping gaps (4.2.4 . . .

• 8-9. Competency requirements (6.2.2 . . .

• 8-9. Effective control of processes (4.1 . . . * Ref. : <http://standardsgroup.asq.org/news/psi/IMS06-2002E-Implementing_ISO_9001-BD.pdf>


http://standardsgroup.asq.org/news/psi/IMS06-2002E-Implementing_ISO_9001-BD.pdf>

Most Common Audit Findings

* Registrar Audit Findings • 1. Documentation gaps

• 2-3. Objectives not measurable

• 2-3. Top management commitment and responsibility

• 4. Continual improvement process

• 5-6. Customer satisfaction data and assessment

• 5-6. Effective control of processes

• 7-8. Collection and analysis of data

• 7-8. Record keeping gaps

• 9. Competency requirements * Ref. : <http://standardsgroup.asq.org/news/psi/IMS06-2002E-Implementing_ISO_9001-BD.pdf>


http://standardsgroup.asq.org/news/psi/IMS06-2002E-Implementing_ISO_9001-BD.pdf>

Comparison of Rankings


Internal Audit Findings • 1. Customer satisfaction data and

assessment

• 2. Documentation gaps


• 4. Objectives not measurable

• 5. Collection and analysis of data



• 8-9. Competency requirements


Registrar Audit Findings • 1. Documentation gaps

• 2-3. Objectives not measurable



• 5-6. Customer satisfaction data and assessment


• 7-8. Collection and analysis of data


• 9. Competency requirements

How to Audit Difficult Clauses

4.1 General Requirements

Clause 4.1 covers the requirement for your organization to set up a quality management system and broadly defines the associated activities. These activities are described in greater detail in the remainder of the standard. And, when you audit these other clauses, you are in essence auditing clause 4.1.


How to Audit ISO 9001:2000, Clause 4.1

• By recognizing its linkages to the clauses in the remainder of the standard.

• Audit those other areas well and you are in effect auditing clause 4.1.



5.0 Management Responsibility • 5.1 Management Commitment


• 5.4.2 Quality Management System Planning (vs. 7.1 Planning of Product Realization)



5.1 Management Commitment

Look for evidence on how top managers ensure their commitment is well known throughout the organization and records that show how they are keeping their promise



5.4.1 Quality Objective

Are You Setting SMART Quality Objectives?

• Is it specific?

• Is it measurable

• Is it achievable

• Is it relevant

• Is it timed?



5.4.2 Quality Management System Planning

(vs. 7.1 Planning of Product Realization)

Organizations must decide how to monitor, measure, and analyze their processes, as well as, be ready to implement the actions necessary to achieve planned results and continually improve the processes. Even outsourced processes are included in the planning.

Determine how this is done using process approach.



7.0 Product Realization

• 7.1 Planning of Product Realization


• 7.5.2 Validation of Processes for Production and Service Provision

Determine how the quality plan is developed.



8.0 Measurement, analysis and Improvement

• 8.2.1 Customer Satisfaction

• 8.5.1 Continual Improvement

• 8.5.3 Preventive Action


Auditing Undocumented Process

Auditing a Process that is Undocumented

Refer to the guide provided to you separately


Summary on Audit Practice

Audits examine compliance from three perspectives:

1. Documents (or definitions) that indicate the process is adequate

2. Records that show the process is implemented (being practiced)

3. Results that prove the process is effective (objectives are met)

By using the process approach in auditing, you will be able to gather all the evidence that you need in auditing for any clause that you may encounter in the field.


EXERCISE No. 2


The purpose of the exercise is to provide practice in assessing evidence in an objective manner..


Workshop

Mock-up audit of Engineering Department



Tips on Auditing

• Adjust your audit approach

• Evaluate the effectiveness of the system

• Remind auditors how to verify conformity

• Know how to audit an undocumented process

• Improve your current internal audit practices


Auditor Conduct

• Be critical

• Be side-tracked

• Argue

• Swear

• Be late

• Be sarcastic

• Compare

• Pass opinions

• Apportion blame

AN AUDITOR SHOULD NOT

Code of Conduct for Auditors

Purpose

To communicate the integrity, objectivity, confidentiality, and competence expected of internal auditors, as well as, to provide a means for them to pledge their commitment to these principles.



Integrity

The integrity of internal auditors establishes trust and provides the basis for relying on their judgment. As an internal auditor, I pledge to:

1. Perform my work with honesty, accuracy, fairness, and responsibility.

2. Not engage in activities that might discredit the audit profession or my organization.



Objectivity Internal auditors must be objective in gathering, evaluating, and communicating information about the activities being examined. They must make a balanced and impartial assessment of all the relevant facts and not be unduly influenced by their interests, or those of others, in making judgments. As an internal auditor, I pledge to:

3. Not join in any activity or relationship that may affect my unbiased assessment.

4. Not accept anything that may impair, or appear to impair, my judgment.

5. Disclose all the material facts to avoid any distortion of my audit report.



Confidentiality

Internal auditors must respect the value and ownership of the information they receive and not disclose it without the appropriate authority (unless obligated for legal or professional reasons). As an internal auditor, I pledge to:

6. Be prudent in the use and protection of the information acquired during my audit duties.

7. Not use the information for personal gain or in any way detrimental to the organization.



Competence Internal auditors must apply their knowledge, skills, and experience in

the performance of their assessment duties. As an internal auditor, I pledge to:

8. Engage only in audits where I possess the needed knowledge, skills, and experience.

9. Perform audits in accordance with the procedures and practices of my organizations.

10. Continually improve my proficiency and the quality and value of my audit services.

11. Assist other auditors under my supervision to develop their audit management skills.

12. Report any complaints regarding my performance and address them to avoid recurrence.


Addendum

• Exercise No. 3 – take home exercise

• ISO 9000 : 2005 –

• ISO 9001: 2008 –

• Sample Question for Top Management


Exercise No. 3

This is an exercise to see how nonconformities are reported

This is a take-home exercise. The answer shall be submitted later.


Internal Auditor Quiz

Answers for the ISO 9001:2000 Clause Quiz The correct clauses for the ten requirements are:

1. Reviewing the system at planned intervals = 5.6.1 [also 8.2.2 regarding audits]

2. Identifying the status of product measurements = 7.5.3

3. Maintaining process equipment = 6.3 (b)

4. Handling, packaging, and storing products = 7.5.5

5. Preventing the "recurrence" of nonconformities = 8.5.2 (not 8.5.3)

6. Maintaining evidence of conformity of acceptance criteria = 8.2.4

7. Ensuring requirements are complete and unambiguous = 7.3.2 [implied by 7.2.2 (a)]

8. Identifying the control of outsourced processes = 4.1

9. Planning for design review, verification, and validation = 7.3.1 (b) [implied by 7.1]

10. Including a quality manual in the documentation = 4.2.1 (b)

How did you do on the quiz? Do you agree with these answers?


Back

ISO 9000:2005

• It makes no changes to the basic principles of quality management stated in ISO 9000:2000

• It is essentially a tidying-up exercise to ensure consistency within ISO Standards

• It will probably have little, or no real impact on our quality system


ISO 9001:2008

• ISO 9001:2000 is due for an update in 2008.

• It is currently at Draft International Standard (DIS) stage

• Changes to the standard are very small

• It will replace ISO 9001:2000



6.0 Resource Management

• 6.1 Provision of Resources

• 6.2 Human Resources

• 6.3 Infrastructure

• 6.4 Work Environment


Process Approach

Interview

Question

PDCA

Note

Check List

Cheat Sheet

Sample Question for Top Management

• How do you influence/oversee the quality policy?

• What quality targets have been set for each department for this fiscal year? What about plant-wide targets? How did you influence these targets? What is your basis?

• How do you ensure that the integrity of the quality management system is maintained when changes are implemented? (i.e., costdowns, new products, hirings/layoffs...)

• How do you use our "Key Measurables" information to ensure continual improvement in quality?



• How are your Objectives developed?

• How do you use the Policy?

• What does the System gain from Management Review?

• Please provide an example of Improvement within the company.

• "If you could do it, what one thing in the Management System would you improve?“



• How do you contribute to achieving your organization's objectives?

• How are objectives determined?

• How are employees trained on objectives?

• How is progress against objectives communicated to the organization?

• What processes and/or tools are in place to help achieve objectives?

• Is there evidence of progress?


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