SURVEY OF ISO 9000 USERS IN NEW

ZEALAND –
DRIVERS and BENEFITS
A descriptive analysis

Pavel Castka
University of Canterbury

Michaela A. Balzarova
Lincoln University

John Kenny
Board member, New Zealand Organisation for Quality

December 2006

For more info visit: http://www.mang.canterbury.ac.nz/research/iso/index.shtml

 Christchurch, December 2006

Dear participants,

New Zealand Organisation for Quality and University of Canterbury,

College of Business and Economics partnered to conduct a survey of
ISO 9000 users in New Zealand. Our aim was to determine what
drives New Zealand companies toward ISO 9000 certification and to
what extent the companies benefit from this.

During August and September 2006, we sent 1774 questionnaires to

quality professionals who have a leadership role, a co-ordination role
or some level of responsibility for ISO 9000 in their respective
organisations. This sample represents all NZ ISO 9000 certified
companies according to Joint Accreditation System of Australia and
New Zealand (JAS-ANZ). We have received 472 valid responses
giving us 27% response rate.

We would like to thank you for your participation in this survey and
offer to you a descriptive analysis of this research. Other papers and
discussion of the results will be available at
http://www.mang.canterbury.ac.nz/research/iso/index.shtml in
March 2007. Should you have any further questions, suggestions or
should you wish to comment on the results, please contact through
our e-mails.

Best wishes,

Pavel Castka, Michaela A. Balzarova and John Kenny

Pavel Castka Michaela A. Balzarova John Kenny

University of Canterbury Lincoln University Board member
Nominated Expert, E-mail: balzarom@lincoln.ac.nz New Zealand Organisation for
ISO/TMB/WG SR Quality
E-mail: E-mail: john.kenny@nzoq.org.nz
pavel.castka@canterbury.ac.nz

Castka, Balzarova and Kenny (2006) Survey of ISO 9000 users in New Zealand – Drivers and Benefits 2
 Part 1: Basic company data
This section of the report provides an overview of companies that took part in this survey. We
have received 472 valid responses. Figures 1.2-1.6 give details about our sample. In general,
most of the participating companies were either manufacturing or services (90% of our sample)
and NZ owned (only 16% of companies were foreign owned). Most of the companies were
small facilities (76%) but many of these were part of larger companies (50% of participating
companies were classified as large). In line with previous studies, we classified small facility as
having 100 employees or less working at the facility and small company as having 100 employees
or less working for the company globally. This classification will allow us to conduct
comparative studies at the international level. Finally, we offer descriptive statistics regarding
certification bodies and a year were companies were first certified to ISO 9000. In our sample,
the majority of companies were certified by Telarc (51%) and the peak in ISO 9000 certification
seems to be around 1994-1995.

Software Foreign ownership Publicly owned

Construction 15%
16%
9% 1%
State owned
Services 8%
43%

Manufacturing
47% Privately owned
61%

Figure 1.1 Companies by sector Figure 1.2 Companies by ownership

Large facility
24%

Large Small
company company
50% 50%

Small facility
76%

Figure 1.3 Companies by size Figure 1.4 Facilities by size

80

SGC-S&SC VNZ NCSI 70

SAI Global
60

LRQA
50

40

ICL Telarc 30

GCS 20

DNV BVQI 10

BC 0
1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006
AGRIQUALITY

Figure 1.5 Companies by certification body (in Figure 1.6 Companies by year first certified (in
our sample) our sample)

Castka, Balzarova and Kenny (2006) Survey of ISO 9000 users in New Zealand – Drivers and Benefits 3
Part 2: Geographies of ISO 9000 certified companies
In question 5 of the survey, we asked for the location of your immediate customers by
indicating how important sales in various geographic regions are for your company. In Figure
2.1 we present the mean scores from our data. The results indicate that most NZ ISO 9000
certified companies have their immediate customers based in New Zealand. Australia, Asia,
Europe and North America are important for some manufacturing and software companies.
However, the results for software companies must be treated with a caution due to a small
number of software companies participating in this survey (1%, see Figure 1.1).

Asia

Japan

NZ - South

NZ - North

Software
Australia Construction
Manufacturing
Services
Africa

Europe

1=not important at all

S America
2=not important
3=moderately important
N America 4=important
5=very important
0.00 0.50 1.00 1.50 2.00 2.50 3.00 3.50 4.00 4.50 5.00

Figure 2.1 Customer bases

In question 7a we asked how many customers in various regions require ISO 9000 certification.
In Figure 2.2 we present the mean score from our sample. In general, the data suggests that very
few companies do require ISO 9000.

Asia

Japan

NZ (South)

NZ (North)

Software
Australia Construction
Manufacturing
Services
Africa

Europe

S America 1=none
2=few
3=some
N America 4=most
5=all
0.00 0.50 1.00 1.50 2.00 2.50 3.00

Figure 2.2 Customers requiring ISO 9000

Castka, Balzarova and Kenny (2006) Survey of ISO 9000 users in New Zealand – Drivers and Benefits 4
 Part 3: Motivations for certification
In question 8 we asked to what extent your company’s success depended on ISO 9000
certification. The results (Figure 3.1) suggest that ISO 9000 played an important role (48%), it
was not important for 18% of our respondents.
quality improvement

marketing advantage

corporate image
not important at all customer pressure
extremely important not important
4%
18% 14% capturing workers' knowledge

relations with authorities

cost reductions

major competitors certified

benefits experienced by other companies

relations with communities

important
somewhat important avoid potential export barrier
30%
34%
0.00 0.50 1.00 1.50 2.00 2.50 3.00 3.50 4.00 4.50

Figure 3.1 Contribution of ISO 9000 to company’s success Figure 3.2 Reasons for ISO 9000 certification

In question 9b we asked you to specify your motivations to seek and maintain ISO 9000
certification (the same scale as for Q8 was used). Figure 3.2 indicates that the main reasons are
related to quality improvement, marketing, corporate image and customer pressure. Figure 3.3 provides a
comparison across sectors. Here, service companies seem to be more motivated in terms of
quality improvements [important] and relations with authorities [somewhat important] and relations with
communities [not important]. Even though the last two elements are of less importance to service
companies, these are significantly different to manufacturing companies. Manufacturing
companies, on the other hand are different to services in their focus on marketing advantage
[important], customer pressure [somewhat important], avoid potential export barrier [somewhat
important] and major competitors certified [somewhat important]. This suggests that manufacturing
companies experience more coercive pressures from their industry to become ISO 9000
certified that services do. However the pressure does not seem to be very strong as all of these
issues are somewhat important. Similar to service sector, construction companies are more
motivated in terms of relations with authorities and relations with communities. Furthermore,
construction companies report stronger reasons to get certified because of major competitors
have already certification and because of cost reductions. Finally, software sector reports avoid
potential export barrier as a much more dominant reason for ISO 9000 certification in comparison
to other sectors. However, results related to software and construction sector should be treated
with caution due to the number of these companies in our sample (10% combined). Differences
between services and manufacturing (as described above) are statistically significant.
quality improvement quality improvement

marketing advantage marketing advantage

corporate image corporate image

customer pressure customer pressure

capturing workers' knowledge capturing workers' knowledge

relations with authorities Total relations with authorities Total

Construction Manufacturing
cost reductions cost reductions

major competitors certified major competitors certified

benefits experienced by other benefits experienced by other

companies companies

relations with communities relations with communities

avoid potential export barrier avoid potential export barrier

0.00 0.50 1.00 1.50 2.00 2.50 3.00 3.50 4.00 4.50 0.00 0.50 1.00 1.50 2.00 2.50 3.00 3.50 4.00 4.50

quality improvement quality improvement

marketing advantage marketing advantage

corporate image corporate image

customer pressure customer pressure

capturing workers' knowledge capturing workers' knowledge

relations with authorities Total relations with authorities Total

Services Software
cost reductions cost reductions

major competitors certified major competitors certified

benefits experienced by other benefits experienced by other

companies companies

relations with communities relations with communities

avoid potential export barrier avoid potential export barrier

0.00 0.50 1.00 1.50 2.00 2.50 3.00 3.50 4.00 4.50 0.00 0.50 1.00 1.50 2.00 2.50 3.00 3.50 4.00 4.50

Figure 3.2 Reasons for ISO 9000 certification (by sector)

Castka, Balzarova and Kenny (2006) Survey of ISO 9000 users in New Zealand – Drivers and Benefits 5
 Part 4: Implementation
In New Zealand, the main drive for ISO 9000 certification comes from several groups in a
company; typically from CEO & top management and quality department (Figure 4.1). Other
departments, such as marketing play less significant role. In the one hand, this is in line with the
most dominant reason to seek ISO 9000 certification (i.e. quality improvement). On the other
hand, less significant role of marketing department is somehow surprising given that marketing
advantage and corporate image were also amongst the main reasons to seek ISO 9000 certification.

R&D, design, development

department
2%
quality department
18% 81-100%
28%
whole organisation 0-20%

7% environmental, H&S 40%

department
3%

marketing
10%

61-80%
CEO, top management 9%
47% operations 21-40%
41-60% 13%
13% 10%

Figure 4.1 Groups initiating ISO 9000 certification Figure 4.2 Employees receiving training for ISO 9000

In question 11 we asked about the percentage of employees that received training for ISO 9000.
On average between 40-60% of all employees receive training (for detailed breakdown see
Figure 4.2). In comparison to the results obtained globally, on average NZ companies seem to
be more relaxed about training for ISO 9000 than their counterparts in other countries. For
instance, in Canada or the US the most companies report 81-100% of employees receiving
training for ISO 9000.

In question 12a of the survey we asked about the importance of several factors for successful
implementation and how much effort did it take. The results in Figure 4.3 suggest that all factor
are seen as highly important apart from training (between medium and high importance) and
capital investment (between some and medium importance). In comparison, the actual effort
that the implementation took, companies mostly reported medium effort. The exception is
documentation and redefining of standard procedures that are seen as requiring a high effort to complete.
Noticeable is a difference between an importance assigned to top management commitment and the
effort it actually took.

Castka, Balzarova and Kenny (2006) Survey of ISO 9000 users in New Zealand – Drivers and Benefits 6
 implementation of corrective action

following standard procedures

periodic audits

workers' commitment

middle management commitment

top management commitment Effort

Importance
capital investment

training
1=none
2=some
documentation 3=medium
4=high
(re)defining standard procedures 5=very high
identification of quality aspects

0.00 0.50 1.00 1.50 2.00 2.50 3.00 3.50 4.00 4.50

Figure 4.3 Factor affecting successful implementation – importance and effort

In question 13a we asked whether quality management systems are implemented exactly as
required by ISO 9000. Here, we wanted to find out whether NZ companies go beyond the
compliance with the standard. On average our respondents disagreed, which suggests that
mostly NZ companies go beyond the requirements. This is in particular significant for service
and manufacturing sector (Figure 4.4).

Q13A
strongly agree strongly disagree
22% 4%
3.10 somewhat disagree

3.00
1=strongly disagree 5%

2=disagree
2.90
3=neutral
2.80 4=somewhat agree
2.70 5=strongly agree
somewhat agree
2.60
27%

2.50
neutral
42%
2.40
Services Manufacturing Construction Software Mean

Figure 4.4 QMS implemented as required by ISO 9000 Figure 4.5 ISO 9000 as facilitator of ISO 14000

Question 13c we asked whether ISO 9000 has facilitated ISO 14000 certification. 113
companies (25% in our sample) responded to this question. For 75% of the remaining
companies this question was not applicable as these companies did not seek ISO 14000
certification. The results suggest that ISO 9000 can be seen as a contributor to ISO 14000
implementation.

In questions 13d and e we sought an understanding about the coercive pressures in supply
chains. In other words, we wanted to know whether ISO 9000 companies in NZ exert any
pressure on their suppliers. Here, most respondents indicated that they in general do not require
their suppliers to seek ISO 9000 certification (Figure 4.6). This is similar across all industries
apart from software. Here again, the result should be treated with caution as the number of
software companies in this survey was very low.

Castka, Balzarova and Kenny (2006) Survey of ISO 9000 users in New Zealand – Drivers and Benefits 7
 3.50 Q13D Q13d We require our key suppliers to have ISO
3.00
Q13D 9000 certification
Q13D
Q13D Q13D
2.50
Q13e We require all our suppliers to have ISO
Q13E
Q13E
Q13E Q13E Q13E
2.00
9000 certification
1.50

1.00
1=strongly disagree
2=disagree
0.50 3=neutral
4=somewhat agree
0.00
Services Manufacturing Construction Software Mean
5=strongly agree

Figure 4.6 Supplier required to seek ISO 9000 certification

In question 13f we asked whether internal audits contribute to improvement of companies’

business. The results in Figure 4.7 confirm the important role of internal audits for companies’
success. This is particular true for service organisations that report the highest score in this area.

Q13F

4.40

4.30

4.20

4.10
1=strongly disagree
4.00
2=disagree
3.90
3=neutral
3.80
4=somewhat agree
3.70
5=strongly agree
3.60

3.50

3.40
Services Manufacturing Construction Software Mean

Figure 4.7 Internal audits contributing to companies’ success

Part 5: Benefits
The majority of NZ companies find ISO 9000 certification beneficial and 41% enjoy substantial
benefits from ISO 9000 (Figure 5.1). Only 1% of companies have no benefits and 16% report
only minor benefits (this is more or less similar for each sector). A sector analysis provides very
similar results.

no benefits
very substantial benefits 1% minor benefits
5% 16%

substatial benefits
36%

moderate benefits
42%

Figure 5.1 Overall benefits from ISO 9000 certification

Castka, Balzarova and Kenny (2006) Survey of ISO 9000 users in New Zealand – Drivers and Benefits 8
Figure 5.2 provides more focused view on the specific benefits from ISO 9000 certification
whilst Figure 5.3 shows differences between software, construction, manufacturing and service
sectors.

improved internal procedures

quality improvements

increased customer satisfaction

improved corporate image

increased on-time delivery to customers

improved relations with authorities

increased productivity

improved employee morale

increased market share 1=no benefits

maintained/increased profit margin 2=minor benefits
3=moderate benefits
environmental improvements
4=substantial benefits
cost reductions 5=very substantial benefits
improved relations with communities

0.00 0.50 1.00 1.50 2.00 2.50 3.00 3.50 4.00

Figure 5.2 Specific benefits from ISO 9000 certification

improved corporate image 1=no benefits

improved relations with communities
2=minor benefits
3=moderate benefits
improved relations with authorities 4=substantial benefits
improved employee morale
5=very substantial benefits

improved internal procedures

maintained/increased profit margin Total

Software
increased market share
Construction
increased customer satisfaction Manufacturing
Services
increased on-time delivery to customers

environmental improvements

quality improvements

increased productivity

cost reductions

0.00 0.50 1.00 1.50 2.00 2.50 3.00 3.50 4.00

Figure 5.3 Specific benefits from ISO 9000 certification – by sector

For further analysis, we highlight and compare the results from manufacturing and services.
Here the number of respondents allowed us to draw statistically significant results. Figure 5.4
outlines specific benefits that ISO 9000 certified manufacturing and services reported. The
respondents indicated that they enjoy substantial benefits in terms of ‘improved internal procedures’
and ‘quality improvements’ and moderate benefits in terms of ‘increased customer satisfaction’ and
‘improved corporate image’. There was a statistically significant difference in ‘cost reductions’, ‘improved
relations with authorities’, ‘improved relations with communities’ and ‘improved corporate image’. Here,
service sector seems to experience more benefits in terms of ‘improved relations with authorities’
[moderate benefits], ‘improved corporate image’ [moderate benefits], ‘improved relations with communities’
[minor benefits] – all of these in fact externally focused. Manufacturing sector, on the other
hand, enjoys more ‘cost reductions’ benefits than service sector even though overall this is only a

Castka, Balzarova and Kenny (2006) Survey of ISO 9000 users in New Zealand – Drivers and Benefits 9
minor benefit.

improved corporate image

improved relations with communities
improved relations with authorities
improved employee morale
improved internal procedures
maintained/increased profit margin
Manufacturing
increased market share
Services
increased customer satisfaction
increased on-time delivery to customers 1=no benefits
2=minor benefits
environmental improvements
3=moderate benefits
quality improvements 4=substantial benefits
5=very substantial benefits
increased productivity
cost reductions

0.00 0.50 1.00 1.50 2.00 2.50 3.00 3.50 4.00

Figure 5.4 Specific benefits from ISO 9000 certification – manufacturing and services

Conclusion
In this research we aimed to map fingerprint characteristics of NZ ISO 9000 certified
companies. We contacted 1774 companies with ISO 9000 certification and asked them about
their motivations and benefits gained through the adoption of the ISO 9000 standard. Data
collected through 472 responses suggest that NZ ISO 9000 certified companies are motivated
to get ISO 9000 certification because of improved quality, marketing benefits and improved
corporate image. The benefits gained after the ISO 9000 certification seem to be largely of
internal nature such as improved internal procedures and improved quality. NZ patterns of ISO
9000 certification are comparable with patterns identified in other developed countries such as
US, Australia, France.

The results outlined in this document provide preliminary descriptive statistics. We plan to
further analyse the data and focus at:
• sector analysis
• comparison and analysis of the results of this study and similar study conducted in 2001
• global comparison
• ISO 14000 drivers and benefits
• “Going for gold”: profiles of NZ companies that enjoy substantial benefits from ISO
9000

More info will be available at http://www.mang.canterbury.ac.nz/research/iso/index.shtml.

Please contact us if you have further comments and suggestions.

Castka, Balzarova and Kenny (2006) Survey of ISO 9000 users in New Zealand – Drivers and Benefits 10