Management Reviews and Business Improvement

What is an effective Management Review?

Management Reviews are a key part of ISO Management systems, designed to deliver continual improvement. Although ISO management systems class the Management Review as part of ‘Performance Evaluation’, a good Management Review is perhaps better considered as part of the ‘Improvement’ strand of the management system. The review looks at the management system as a whole, to “…ensure its continuing suitability, adequacy, effectiveness and alignment with the strategic direction of the organization” (clause 9.3.1, ISO 9001:2015).

In practice, the Management Review involves senior management meeting for a structured review to determine how the management system, and therefore the wider organisation, has performed. Typically, the director or senior manager responsible for the management system (typically a quality, environmental, health & safety or integrated system) will be present, along with the system manager (the person responsible for the day-to-day running and development of the system), internal auditors, operational and production managers. The meeting will typically take half a day, but this obviously varies depending on the size and complexity of the organisation and the management system.

As auditors, we sometimes find that organisations appear to have conducted the Management Review ‘because the auditors are coming’. Indicators of this tend to be a Management Review conducted days (or hours!) before the audit, with content often cut and pasted from the previous year’s report, and essentially reporting that ‘all is fine, move on’. While this might avoid a major non-conformity at audit, it means that one of the most useful drivers for continual improvement is being missed, and the benefits from running the management system will be greatly reduced.

We believe that part of the reason Management Reviews are sometimes neglected is because they are misunderstood. A view we often come across at audit, particularly in smaller companies, is that Management Reviews are unnecessary because senior staff regularly meet and discuss issues on a rolling basis or in ‘real-time’. We try to explain that the purpose of a Management Review is different to that of daily, weekly, or even monthly operational meetings, which are management meetings, not management reviews. The Management Review should be much more ‘big-picture’: it should be a review from a more strategic position and allow you to step back and look at your organisation from a different angle. The ‘helicopter view’ allows for reviewing clarity of purpose and promotes systems thinking. It involves looking at your organisation as a whole, not just focusing on single issues and smaller details. As part of a Management Review, you are going to ask questions such as: “What’s our overall strategy for improving quality?”; “Is it working?”; or “What resources, staff or training do we need to invest in?”. These discussions and decisions should be evidence-based, using internal audit findings, non-conformities and continual improvement and customer satisfaction data.

We also often get asked about the frequency of Management Reviews. ISO 9001, for example, states that Management Reviews should be held ‘at planned intervals’, which is not very helpful! Most auditors will expect to see a Management Review being conducted at least annually, drawing on data and information collected throughout the year

Management Review Inputs and Outputs

Details of the expected inputs and outputs of a Management Review are set out in Section 9.3 of the management standards. These can be used to generate an agenda or structure for the meeting. In essence, actions from previous Management Reviews need to be addressed: were the actions completed, were they evaluated, were they successful, do any further actions need to be generated? Then a strategic discussion may be held: what has changed for the organisation, internally and externally? Changes might include new processes, new clients, or a looming recession. How have you or will you react to these changes? Then you will examine the performance and effectiveness of the management system, including whether objectives, KPIs and results have been delivered, looking at customer satisfaction, audit results, non-conformities and improvement actions.

Based on the above, risks and opportunities will be reviewed, including the effectiveness of actions you have taken to minimise risk and utilise opportunity.

Finally, all the above is considered to identify opportunities for improvement and appropriate actions. These become the output of the Management Review, including any need for changes to the management system and identification of resources needed for effective implementation.

Driving Business Improvement

This overview has aimed to briefly highlight why the Management Review can be very effective in driving continual improvement in a business. It allows the management team to see ‘the big picture’ issues based on real data from audit, surveys and other monitoring activities. It allows KPIs to be reviewed and acted upon. A good Management Review should identify the management system issues, and address these through effective actions. Finally, these actions need ownership by individual senior managers, and the actions need to be reviewed in an appropriate manner. This will deliver real and tangible improvement to your organisation.