All organizations have challenges in their businesses, But these internal and external challenges pose a threat to our goals and risk of their nonfulfillment.

1. By Safi Qudsi

2. Realities of Business World
New Satellite Program Major Delays
US Govt. faced
$3 billion in cost
overruns and a
three-year delay
in new satellite
program for
Hurricane &
severe weather
tracking.

3. Realities of Business World
FoxMeyer Drugs Bankruptcy
In 1993, FoxMeyer Drugs was the
fourth largest distributor of
pharmaceuticals in the U.S., worth $5
billion. In an attempt to increase
efficiency, FoxMeyer purchased an SAP
system and a warehouse automation
system it what was supposed to be a
$35 million project. By 1996, due to
number of issues the company was
bankrupt; it was eventually sold to a
competitor for a mere $80 million.

4. RISK BASED QUALITY MANAGEMENT SYSTEM
AUDITING

5. Definitions of Risk
Combination of the probability of an event and its consequence
(ISO DGUIDE 73)
The chance of something happening that will have an impact
upon objectives. It is measured in terms of consequences and
likelihood. (AS/NZS 4360)

6. Risk in Simple Words
Risk = Likelihood X Consequence

7. Risk Management
Acceptance/Tolerance: With or without planning of contingency.
Reduce likelihood or consequence: By establishing processes
and controls
Analysis, evaluation and assessment
of risk and its rational control in
helping to promote the objectives
and targets of the business

8. Risk Based Quality Management System
Auditing
Auditor typical
role was limited
to documenting
audit findings
including non-
conformances
(if any)

9. Risk Based Quality Management System
Auditing
VALUE ADDED
Auditing QMS Risk = AUDIT
Management tool to prioritize the issues accordingly

10. SCORING TABLE: RISK BASED CONFORMANCE AUDIT & SCORING SYSTEM
Quality Management System Conformance
Risk Classification
Clause / Score
Sub-Clauses ISO 9001:2008 Standard Requirements Clause Sub Clause
Score Score H M L
7 Product Realization
7.1 Planning of product realization
7.2 Customer-related processes (Title)
7.2.1 Determination of requirements related to product
7.2.2 Review of the requirements related to the product
7.2.3 Customer communication
7.3 Design and Development (Title)
7.3.1 Design and Development Planning
7.3.2 Design and Development Input
7.3.3 Design and Development Output
7.3.4 Design and Development Review
7.3.5 Design and Development Verification
7.3.6 Design and Development Validation
7.3.7 Design and Development Changes
7.4 Purchasing (Title)
7.4.1 Purchasing Process
7.4.2 Purchasing Information
7.4.3 Validation of Purchase Information
7.5 Product and Service Provision (Title)
7.5.1 Control of product and service provision
Validation of processes for production and service
7.5.2 provision Information
7.5.3 Identification and traceability
7.5.4 Customer Property
7.5.5 Preservation of product
7.6 Control of monitoring and measuring equipment

11. Post Audit Activities
• Decisions based • Plan to reduce
on analysis and Risks identified
monitoring in audit.
results. Improvement of
• Actions taken processes &
controls
ACT PLAN
CHECK DO
• Indicators & • Implementation
Measurement. of planned
• Audit actions