Context of the organization

Context of the organization
See also



Context of the organization as defined in ISO 9001 is understood as set of factors affecting business (internal and from environment). ISO 9001:2015 require to evaluate internal and external factors affecting business during preparation to implement quality management system. Managers should define organizational objectives, culture of organization, production processes, information system, market position, customer requirements, employee needs, knowledge gap, key success factors, etc. Is should also contain comprehensive stakeholder analysis. Context of the organization is then used to make strategic implementation decision and preparing resources needed for efficient QMS implementation[1].

The context of the organization is a new concept in ISO 9001. This concept is in the uniform structure of "High Level Structure", which since 2012 has been defined for all management systems. Therefore, this is also linked to the revision of ISO 14001. The requirements for this element are given in Chapter 4 in all management system standards. In this chapter, two aspects can be distinguished: 4.1 Understanding the company and its context, 4.2 Understanding the needs and expectations of stakeholders. The idea is to determine the requirements that affect the planning of the quality management system.

Organization context - requirements The organization should define internal and external issues that affect the ability to achieve the intended goals of the quality management system and are appropriate to the strategic direction and purpose of the enterprise. The organization must review and monitor these issues.

1. External issues The external environment of the company includes, among others, factors:

  • economic factors
  • technological factors
  • political factors
  • social factors
  • cultural factors
  • legal factors
  • financial factors
  • environmental factors For example: The purchase of new technologies may have a positive impact on the functioning of the company, so it is important to design the system so that its implementation in the future is ready.

2. Internal issues The internal context of the organization consists of elements such as:

  • human resources
  • know-how and possessed technologies
  • applicable standards
  • targets
  • strategy
  • organizational structure
  • communication system
  • e.t.c. For example: To increase the production volume, human resources that the organization has are not sufficient. The machine park that is used is energy-intensive. It is worth systematically approaching all planned improvements that improve the functioning of the company.


Tools that can be used for analysis[edit]

Tools that can be used for analysis:

  • P.E.S.T analysis - Political, Economic, Social, Technological
  • P.E.S.T.L.E. (E) analysis - P.E.S.T + Legal + Environmental + (Ethical)
  • SWOT analysis - Strengths, Weaknesses, Opportunities and Threats

PEST[edit]

PEST is a tool that is used to analyze the company's macro-environment. The abbreviation PEST was taken from the words indicating the company's environment: Political, Economic, Social / Socio-cultural, Technological. When planning a business, all these factors must be taken into account.

Factors:

  • Political factors - which include the company regulation system is, for example, European integration, environmental protection regulations, antimonopoly laws and regulations relating to foreign trade.
  • Economic factors - they include inflation, interest rates, money supply, unemployment, economic cycles, trends in GDP, etc. In order to match the offer to the financial capabilities of citizens, the average salary or standard of living should also be taken into account.
  • Socio-cultural factors - include studying the level of education, lifestyle, habits, population demographics, moral and ethical norms etc. When introducing a new product, we need to know what preferences consumers have in order to properly adapt the product to a potential buyer.
  • Technological factors - include state spending on research, focus on technological effort, transfer speed or new technologies.

SWOT[edit]

SWOT is a strategic analysis of an enterprise named after four concepts: Strenghts, Weaknesses, Opportunities, Threats. This analysis can be used both for the entire company and individual spheres of functioning, eg marketing, production, etc. It is often used as a technique of the initial strategic analysis of the company in the advisory activity. This analysis is a venture in which people in lower-level positions as well as managerial positions are involved[2] . To properly develop a SWOT analysis, it is necessary to identify factors that may affect the current and future situation of the company. We distinguish two qualifying factors that cause both positives and negatives: external (PEST, scenario analysis, etc.), internal (knowledge, financial resources, personnel, etc.).

PESTLE[edit]

PESTLE this is economic analilza for entrepreneurs. It is prepared mainly for the purpose of entering the market, it is adapted for a given territorial area.

Elements of the PESTLE analysis:

P - political - here mainly politics and programs of local authorities that define the functioning of business.

E - economic and financial determined business operations, as well as economic conditions of clients.

S - social - customer behavior and consumer behavior, which are culturally and socially conditioned.

T- technological - technological as well as scientific background which refers to conducting activities in the field of research and development.

L - legal - legal regulations that relate to a large extent to the process in which we obtain patents, and to the laws on the protection of intellectual property as well as to the research and development department.

E - environmental - these are international systems and initiatives by the government and the local government regarding environmental protection.


References[edit]

Footnotes[edit]

  1. Mohammad Mosadegh Rad, A. (2006)
  2. Hill T., Westbrook R., (1997)

Author: Magdalena Worłowska