Operations Consulting Overview - RSM India publication

Astute Consulting
OPERATIONS CONSULTING
- AN OVERVIEW

Astute Consulting
- AN OVERVIEW
OPERATIONS CONSULTING - AN OVERVIEW

Partnering
Always.
For Your Success...
Indian member of RSM International
International delivery capabilities
Audit, Tax, Consulting and Outsourcing
Services
Multi-disciplinary team
RSM International in India
Members include
Suresh Surana & Associates
Lemon Consulting
Nation-wide presence in 10 cities
Personnel strength of over 750
Astute Consulting
RSM International
Founded by RSM McGladrey, the 5th
largest accounting and consulting
group in the USA (next only to the Big 4)
World's 7th largest accounting and
business advisory organisation
Annual revenue of US$ 3.06 billion
662 offices across 64 countries

PREFACE
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BACKGROUND
OperationsConsultingrepresentsabouquetofserviceofferingsthatimpactsevery
linkinthevaluechainofanorganization.Factorsthathavecreatedtheneedforthis
range of services include increased competition, complex and dynamic operating
environmentandtechnological advancements.
We believe that Organizations have the potential to gain unprecedented
performance from each link in the value chain and it is our endeavour to help our
clientsachievethisthroughthefollowing:
•Assisting organizations achieve higher levels of productivity from their core
assets,theirbusinessprocessesandtheirstrategicrelationships.
•Helpingclientsgainadistinctanddurablecompetitiveadvantage.
•Seeingitthrougheveryphaseofimplementation.
Astute can be your ideal service provider in the area of Operations Consulting, due
to:
•Access to global best practices due to our membership of RSM International
(the seventh largest accounting and consulting group worldwide with annual
revenueofUS$3.06billion)
•Availability of highly qualified, experienced & skilled staff – We have
professionals from varied backgrounds viz. Chartered Accountants, Cost
Accountants, MBAs, Engineers etc. this enables us to address a variety of
issuesfromdifferentperspectives
•Exposure to various industries – Engineering, Gem & Jewellery, Hospitality,
Entertainment,FinancialServices,Retailetc.
•Emphasisona“SolutionOriented”approach
•Ability to service your multi-geographic locations in India due to Astute
ConsultingGroup'spresencein10citiesacrossIndia
As always, Astute is committed to incorporating the latest techniques and highest
skillsinourserviceofferings.Wearesurethatmanyoftheserviceofferingslistedin
this publication will be of interest to your organization. Our representatives will be

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pleased to meet you in person and provide you with assistance in identifying areas
thatneedattention.
We trust that you will find this publication of interest to your organization and look
forwardtoamutuallybeneficialrelationship.
In this circular compiled by us, we intend to offer a broad outline of various
operationsconsultingservicesprovidedbyus.
This circular should not be relied upon for taking actions or decisions without
appropriate professional advice as the facts of each case have to be studied and
the legal position analyzed properly before taking any action or decision in the
matter. We have taken all care and effort to ensure that the information provided
herein is correct and upto date. However, we take no responsibility for any
inaccuracy or omission that might have occurred in this Circular. This note is for
privatecirculationonly.Nopartofthisnotemaybereproducedortransmittedinany
formorbyanymeanswithoutourwrittenpermission.
SCOPEANDLIMITATION

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CONTENTS
1 Certification to Various International Standards 1
1.1 ISO 9001:2008 - Quality Management System 1
1.2 ISO 14001:2005 - Environment Management System 3
1.3 OHSAS 18001:2007 - Occupational Health And
Safety Assessment Series 4
1.4 SA 8000:2008 - Social Accountability 6
1.5 ISO 27001:2005 - Information Security
Management System 9
2 Compliance / Certification to
Certain Industry Specific Standards 12
2.1 BPP Best Practice Principles for Sightholders
of Diamond Trading Company 12
2.2 BEM Business Excellence Model
Applicable to select Diamantaires of Rio Tinto Diamonds 13
2.3 Healthcare Industry Specific Standard ( NABH) 14
2.4 TS 16949:2002 Standard for Automotive Industry 16
2.5 ISO 22000:2005 Standard for
Food Safety Management System 17
3 Process / Performance Improvement 19
3.1 Six Sigma 19
3.2 Diagnostic Studies leading to Business Improvement 21
3.3 Cost Optimization Materials / Manpower /
Establishment & Administrative 23
4 Enterprise Risk Management and
Internal Control Framework 24
5 Documentation of Systems, Procedures, SOPs. 26
About Astute Consulting Group 27
Chapter
No.
Topic Page
No.
- AN OVERVIEW

1.1 Certification to ISO 9001:2008 Standard for Quality Management
System
1.1.1 WhatisISO9001:2008?
1.1.2 HowtoachievecertificationtoISO9001:2008?
ISO stands for International Organization for Standardization. This
organization with its Head Quarters in Geneva has representatives from
more than 140 countries and is involved in developing standards that are
acceptedinternationally.
ISO 9001:2008 is one such standard developed by ISO and this standard
addresses Quality Management System (QMS). QMS refers to managing
the processes within the organization that affect quality so that customer
requirements are fully taken care of. This standard is applicable to any
organization irrespective of the nature of product or service provided. Thus,
the standard has been successfully implemented in Manufacturing, Service,
Software,Hardwareandotherindustrysegments.
The main focus of this standard is to achieve high level of customer
satisfactionandensurecontinualimprovementinallinternalprocesses.
Everyorganizationdesirousofachieving certification toISO9001:2008must
gothroughthefollowingsteps:
•Obtain management commitment and appoint a “Management
Representative”tocoordinateallactivities
•Identify the processes within the organization that affect the quality
oftheproduct/serviceprovidedbytheorganization
•Document the processes and train personnel to implement these
processes
•Set functional objectives and create system for measurement and
monitoring
CHAPTER 1: CERTIFICATION TO VARIOUS
INTERNATIONAL STANDARDS
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•Conduct internal audit to check effectiveness of the implemented
system
•Review by the Senior Management of the organization to check
adequacyandeffectivenessoftheQualityManagementSystem
•Conduct third party assessment by a professional certification
body and Obtain certification of the QMS to the ISO 9001:2008
standard
•Maintain the system with necessary changes from time to time and
workforContinualImprovementofthesystem
•Getperiodicsurveillanceauditsconductedbythecertificationbody
Thecertificatehasavalidityof3yearsandhastoberenewedthereafter.
This standard is applicable to all organizations irrespective of their size,
manpower strength and the nature of product or service provided by the
organization to its customers.Thus, any organization that desires to improve
its process orientation and demonstrate its commitment to quality should go
in for this certification. Obtaining certification to this standard is considered
as a basic step in setting up sound systems and paves the way for adopting
additionalinitiativesintherealmofTotalQualityManagement.
Thereareessentiallytwosignificantadvantagesofthiscertification:
Marketing Tool – Customers trust ISO 9001 certified organizations more
than those that are not certified. Thus the certification enhances the
organization's image in the eyes of its customers. In certain situations,
customersdemandthattheorganizationsmustbecertifiedtothisstandardin
ordertoqualifyfordoingbusinesswiththem.
ImprovedInternalControls–Anorganizationthatfollowstherequirements
oftheISO9001standardwillhavewelldefinedprocessesandsoundinternal
control systems. Obtaining third party certification ensures rigorous
implementation of the systems and helps to achieve stable and effective
processorientation.
1.1.3 WhichorganizationscanapplyforcertificationtoISO9001:2008?
1.1.4 BenefitsofobtainingcertificationtoISO9001:2008
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1.2 CertificationtoISO14001:2005StandardforEnvironmentManagement
System
1.2.1 WhatisISO14001:2005?
ISO stands for International Organization for Standardization. This
organization with its Head Quarters in Geneva has representatives from
more than 140 countries and is involved in developing standards that are
acceptedinternationally.
ISO 14001:2005 is one such standard developed by ISO and this standard
addresses Environment Management System (EMS). EMS refers to
managing the processes within the organization that affect the Environment
so that adverse impacts to the environment are minimized. Running
industries in an eco-friendly manner is no more an option but a pre-requisite
fortheirexistence.
Every organization desirous of achieving certification to ISO 14001:2005
mustgothroughthefollowingsteps:
•Obtain management commitment and appoint a “Management
•Identify the processes within the organization that have an impact
ontheenvironment
•Documenttheaspectsandtheirimpactsontheenvironment
•Identify projects that will reduce the impact on the environment and
setmeasurabletargetstobeachievedwithwelldefined timeframe
•Conduct internal audit to check effectiveness of the implementation
oftheidentifiedprojects
adequacyandeffectivenessoftheEnvironmentManagementSystem
•Conductthirdpartyassessmentbyaprofessionalcertificationbody
andObtaincertificationoftheEMStotheISO14001:2005standard

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Validity of ISO 14001 : 2005 certificate is for a period of 3 years and needs to
berenewedthereafter.
This standard is applicable to all organizations irrespective of their size,
manpower strength and the nature of product or service provided by the
organization to its customers. Thus, any organization that desires to ensure
environment friendly processes within the organization and demonstrate its
commitmenttoacleanenvironmentshouldgoinforthiscertification.
Fulfilling requirements of the ISO 14001:2005 standard helps an
organization to reduce the impact on environment of its operations as well as
it helps in controlling depletion of natural resources. The certification
enhances the organization's image in the eyes of knowledgeable and
demandingcustomers.
OHSAS 18001:2007 addresses Occupational Health & Safety Management
in organizations. This standard helps in managing occupational health and
safety impact of organizations' operations. By adopting this standard,
organizations can eliminate or minimise risk to its employees and other
interested parties who may be exposed to OH&S risks associated with its
activities Occupational Health & Safety is being well recognized as an
Integral Part of the Company's Business and any neglect at any stage from
concept stage to design, Erection,Testing, Commissioning, and Operation &
Maintenance of Plant can result in Disaster in the shape of Human Loss and
Sufferings. The management system does not target the product or service
safety, but the safety of employees, temporary employees, contractors,
visitors, and other personnel. This systems is applicable to service
organizations as well. Especially to those organizations where there is high
stress level/work pressure (e.g. software/BPO due to working hours) or the
1.2.4 Benefits
1.3 Certification to OHSAS 18001:2007 Standard for Occupational Health
andSafetyAssessmentSeries
1.3.1 WhatisOHSAS18001:2007?

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organizations which are exposed to the treat of being an easy target of any
kind of disaster, be it man made or natural (like malls, shopping complexes
etc.) due to number of people operating in the physical boundary limit of the
organization.
OHSAS 18001 has been designed to be compatible with ISO 9001 and ISO
14001tohelpyourorganization meettheirhealthandsafety obligations inan
efficient manner. Every organization desirous of achieving certification to
OHSAS18001:2007mustgothroughthefollowingsteps:
•Assemble a team and define your strategy - The adoption of a
management system needs to be the strategic decision of the whole
organization. It is vital that your senior management is involved in the
creation process. They decide the business strategy that an efficient
management system should support. In addition, you need a
dedicated team to develop and implement your management system.
Obtain management commitment and appoint a “Management
•Identify hazards and assess risks in your work environment and
develop methods to eliminate hazards and risks. Document the
processesrelatedtoriskmanagement.
•Implement measures to evaluate further improvement and
strengthenyourorganization'sabilitytomeetstrategicobjectives.
•Conduct internal audit to check effectiveness of the implementation
ofthesystem
adequacyandeffectivenessoftheManagementSystem
andObtaincertificationtoOHSAS18001:2007
Validity of OHSAS 18001:2007 certificate is for a period of 3 years and needs
toberenewedthereafter.
1.3.2 HowtoachievecertificationtoOHSAS18001:2007?

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1.3.3 WhichorganizationscanapplyforcertificationtoOHSAS18001:2007?
1.3.4 Benefits
1.4 CertificationtoSA8000StandardforSocialAccountability
1.4.1 WhatisSA8000?
OHSAS 18001 can be adopted by any organization wishing to implement
formal systems and procedures to reduce the risks associated with health
and safety in the working environment for employees, customers and the
generalpublic.
Occupational Health and Safety Management System
With a systematic and effective OHSMS,
youwillreduce:
•The number of personnel injuries through prevention and control of
workplacehazards.
•Theriskofmajoraccidentsoccurring.
•Themateriallosscausedbyaccidentsandproductioninterruptions.
•Theinsurancecostsaswellascostsduetoabsenceofemployees.
Your work to safeguard employees will give you a more enthusiastic
workforce. But it also proves to your customers that you are working actively
to ensure that your operations are safe not only for your employees but also
thesurroundingenvironment.
SA 8000 is a standard that covers labour rights and workplace conditions in
factories. The standard was created by Social Accountability International
(SAI) that was founded in 1997 and brings together business and
stakeholderstodevelopandimplementsocialaccountabilitysystems.
Ensuring fair treatment of employees in today's complex business
environment is an important requirement and numerous stakeholders --
suppliers, manufacturers, buying agents, contractors and subcontractors --
An (OHSMS)
promotes a safe and healthy working environment by providing a framework
thatallowsyourorganizationtoconsistentlyidentifyandcontrolitshealthand
safety risks, reduce the potential for accidents, aid legislative compliance
and improve overall performance.

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sharetheresponsibilityofsafeguardingworkerrights.
The Social Accountability Requirements includes nine subsections that
cover such topics as child labor, forced labor, health and safety, freedom of
association and right to collective bargaining, discrimination, disciplinary
practices,workinghours,compensationandmanagementsystems.
The following steps must be adopted by organizations for obtaining the
certification:
•LearnWhatSA8000Requires-FamiliarizeyourselfwiththeSA8000
Standard and Certification system by reviewing the SA8000 Standard
andGuidanceDocuments.
•Seek SA8000 Applicant Status - You should apply for SA8000
Applicant status by requesting an application form from an accredited
certification auditing body. Submit the application with supporting
documentation showing that your facility complies with relevant
national and local regulations, assessing your facility against the
SA8000 standard and making the commitment to apply for a
certification audit within one year by placing a non-refundable deposit
for auditing fees.Applicant status is an important signal to buyers and
others that a facility is committed to pursuing SA8000 certification in a
timely fashion. Buyers that have committed to implementing SA8000
through the SA8000 Corporate Involvement Program (CIP) must give
preference to suppliers who are SA8000 Applicants. CIP companies
must also report publicly of the number of suppliers who have
achievedApplicantstatusandgoalsforthenearfuture.
•Initial Assessment - Once you have completed your internal
assessment of compliance to SA8000 and made any changes to
conditions, policies and management systems required by the
standard, you can arrange for an assessment audit (also known as a
"pre-audit"byoneoftheaccreditedauditingfirms).
•Certification Audit and Surveillance Audits - You have made the
changes identified by the pre-audit. Now, contact your Certification
Auditor to make arrangements for a full certification audit. This will
include scheduling the timing of the audit, the amount of auditor time
needed to conduct the audit and the fee for the audit. A specially
1.4.2 HowtoachievecertificationtoSA8000?

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trained local audit team will be assigned to your business. The team
should know applicable local laws, local NGOs will brief them and
trade unions and speak the local language(s) of your managers and
workers. You will be asked to provide the audit team with access to
relevantrecordsaswellasthefreedomtointerviewyouremployees.If
any aspect of your operations does not meet what is required by the
standard, the audit team will issue a major or minor corrective action
request. As part of the certification audit process, you will have the
opportunity to address these corrective action requests by taking
immediate action or developing a plan for addressing the non-
compliance in a brief period. The audit team will review your
responses to any corrective action requests and then make a
recommendation on whether or not to issue a certificate to their
management who will then make a final decision and communicate it
to you. An SA8000 certification is good for 3 years. There will be
surveillance audits every 6 months or once a year if the certification
auditordeemsthatthefacilityisperformingverywellincomplyingwith
the standard. Every three years, the facility must undergo a full
certificationaudittomaintainitscertification.
Any organization desirous of demonstrating its commitment to employee
welfare, decent working conditions and compliance to local and international
labour laws should go in for certification to SA 8000. If you are a supplier to
any large multinational chain, certification to SA8000 may be a pre-requisite
fordoingbusinesswiththeclient.Thecertificationisawayforretailers,brand
companies, suppliers and other organizations to maintain just and decent
working conditions throughout the supply chain. SA8000 certified facilities
are posted on the SAI Web site. Companies that join level two of the SA8000
Corporate Involvement Program (CIP) release annual progress reports
verifiedbySAI.
Along with humane workplaces, the implementation of SA8000 offers more
benefitstoworkers,companiesandothers:
•Puttingcompanyvaluesintoaction.
1.4.3 WhichorganizationscanapplyforcertificationtoSA8000?
1.4.4 Benefits

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•Enhancingcompanyandbrandreputation.
•Improvingemployeerecruitment,retentionandperformance.
•Bettersupplychainmanagementandperformance.
•Clearandcredibleassuranceforethicalpurchasingdecisions.
•Identification of products made ethically and companies committed to
ethicalsourcing.
•Public awareness of companies committed to assuring humane
workingconditions.
Information is an asset that, like other important business assets, is essential
to an organization's business and consequently needs to be suitably
protected. This is especially important in the increasingly inter connected
business environment. As a result of this increasing inter connectivity,
information is now exposed to a growing number and a wider variety of
threatsandvulnerabilities.
Information security is the protection of information from a wide range of
threats in order to ensure business continuity, minimize business risk, and
maximizereturnoninvestmentsandbusinessopportunities.
ISO 27001:2005 is an international standard that provides a model for
establishing, implementing, operating, monitoring, reviewing, maintaining
andimprovinganInformationSecuritymanagementSystem(ISMS).
Every organization desirous of achieving certification to ISO 27001:2005
mustgothroughthefollowingsteps:
•Obtain management commitment and appoint a person to
coordinateallactivitiesrelatedtoInformationSecurity
•Establish ISMS policy, objectives, processes and procedures
relevanttoinformationsecurity
1.5 CertificationtoISO27001:2005StandardforInformationSecurity
1.5.1 WhatisISO27001:2005?

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•Identify security requirements carrying out a process of risk
assessment and selecting controls to ensure that risks are reduced to
anacceptablelevel
•Implementandoperatethesystemcreatedasabove
system
•MeasureprocessperformanceagainstISMSpolicy,objectivesetc.
adequacyandeffectivenessoftheISMS
andObtaincertificationoftheQMStotheISO27001:2005standard
ISO 27001:2005 is aligned with ISO 9001:2008 and ISO 14001:2004 and
one suitably designed system can satisfy the requirements of all these
standards.
Validity of ISO 27001:2005 certificate is for a period of 3 years and needs to
berenewedthereafter.
Information can exist in many forms. It can be printed or written on paper,
stored electronically, transmitted by post or by using electronic means,
shown on films or spoken in conversation. Whatever form the information
takes, it should always be appropriately protected. Any organization that
needs to ensure security of its information should go in for certification to this
standard. Typically, organizations involved in processing customer
information need this certification to assure their customers about the
security of the information provided to them. Besides, organizations can
adopt this standard to protect their internal information systems. Thus,
organizations from a wide variety of industries have been certified to this
standard.

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1.5.4 Benefits
Certificationtothisstandardenablesorganizationto:
üDemonstrateahigh,andappropriate,standardofsecurity
üIncreasetheabilitytomanageandsurviveadisaster
üEstablishmutualtrustbetweennetworkedsites
üEnhanceQualityAssurance-ISO9000,SEI-CMM
üEnable future demands from clients, stockholders and partners to be
met
üCompliance/Certificationtocertainindustryspecificstandards.

2.1 Compliance to Best Practice Principles (BPP) for Sightholders of
DiamondTradingCompany
2.1.1 WhataretheBestPracticePrinciples?
2.1.2 HowtoachievecompliancetoBPP?
The Best Practice Principles (BPP) have been defined by De Beers as a
compliance requirement for the sighthoders of the Diamond trading
Company. The BPP Assurance Programme is a systematic means of
monitoring the compliance of sightholders and their business partners in the
diamond industry with the BPPs. It has been developed to provide evidence
to pipeline partners, consumers and other interested stakeholders that the
exploration, extraction, sorting, cutting and polishing of diamonds, and the
manufacture and sale of diamond jewellery by entities that are owned or
controlled by the De Beers Group or by Diamond Trading Company
sightholders, are undertaken in a professional, ethical and environmentally
friendlyandaccountableway.
The BPPAssurance Programme comprises a management system and set
of audit tools, the most important of which is an audit workbook. The
information provided by completing the Assurance Programme Audit
Workbook (the “BPP Audit Workbook”) measures compliance with the
BPPs systematically, in accordance with the BPP Requirements. This
programme is based on various international standards such as 9001,
14001,OHSAS18001andSA8000.
Sightholders of the Diamond Trading Company are required to go through
thefollowingstepsinordertoachievecompliancetotheBPP:
•Document the policies and procedures of the group addressing
BPPrequirements
•Trainpersonneltounderstandandimplementtheprocedures
•Conduct First Party audit to check effectiveness of implementation
–IdentifyMaterial,MajorandMinorBreaches
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CHAPTER 2 : COMPLIANCE / CERTIFICATION TO
CERTAIN INDUSTRY SPECIFIC STANDARDS

•Review by the Senior Management of the breaches and identify
correctiveaction
•SubmitBPPWorkbooktotheverificationagency,SGS
•SGSwillchoose10%oftheentitiesforphysicalverification
•CompleteverificationauditbySGSandsubmitcorrectiveactions
•RepeatthiscycleeveryyearaspertheschedulegivenbyDeBeers
It is mandatory for all sightholders of Diamond Trading Company to comply
withBPP.
The Business Excellence Model (BEM) has been developed by Rio Tinto
Diamonds for the Diamond and Jewellery industry based on the various
National and International standards such as ISO 9000, ISO 14000, OHSAS
18001,SA8000etc.
The BEM is applicable to any organization in the diamond and diamond
jewellery manufacturers and retailers that wishes to demonstrate its ability to
consistently provide a product and / or service that meets customer and
applicableregulatoryrequirements.
Rio Tinto Diamonds awards certificates to those organizations that
successfully pass an audit conducted by a third party agency appointed by
RioTinto.
Entities in the Diamond and Diamond Jewellery manufacturing and retailing
business are required to go through the following steps in order to achieve
certificationtotheBEM:
•Document the policies and procedures of the group addressing
2.1.3 WhichorganizationsshouldcomplywithBPPs?
2.2 Consultancy for certification to Business Excellence Model (BEM) of
RioTintoDiamonds
2.2.1 WhatistheBusinessExcellenceModel?
2.2.2 HowtoachievecompliancetoBEM?
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BEMrequirements
•Trainpersonneltounderstandandimplementtheprocedures
•Conductinternalaudittocheckeffectivenessofimplementation
•Review by the Senior Management of the non conformance and
identifycorrectiveaction
•Invite DNV for document review and physical verification - DNV
conducts an audit and confirms that the organization complies with
BEMrequirements
•DNVsubmitsitsreporttoRioTintoDiamonds
•RioTintoDiamondsissuesthecertificatebasedonDNV'sreport
•BEM Certificate is valid for three years during which surveillance
auditsareconducted
Any organization in the Diamond and diamond Jewellery manufacture and /
orretailcanapplytoRioTintoforobtainingcertificationtoBEM.
NationalAccreditation Board for Hospitals & Healthcare Providers (NABH) is
a constituent board of Quality Council of India (QCI). NABH is set up to
establish and operate accreditation program for healthcare organizations.
NABH is structured to cater to much desired needs of the consumers and to
setbenchmarksforprogressofhealthindustry.Theboardhasfullfunctioning
autonomy and is supported by industry, consumers and government. In
December 2005, NABH has drafted Accreditation Standards for the
Hospitals&Healthcareindustry.
“Standards for Hospital” has been drafted by the Technical committee of
NABH and contains complete set of standards for evaluation of hospitals for
grant of accreditation. The standard provides a framework for quality
assurance and quality improvement for hospitals and focuses on patient
safety and quality of care. The standard also calls for continuous monitoring
2.2.3 WhichorganizationscanapplyforcertificationtoBEM?
2.3 Accreditation to the NABH Standard for Hospitals and Healthcare
Providers
2.3.1 WhatistheNABHStandardforHospitalsandHealthcareProviders?

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and comprehensive corrective action plan leading to building of quality
culture at all levels and across all the functions. The standards are equally
applicabletohospitalsandnursinghomesinthegovernmentaswellasinthe
privatesector.
Accreditation to the NABH standard provides a public recognition of the
achievement of standards by a healthcare organization, demonstrated
throughanindependentexternalpeerassessment.
TheNABHstandardaddressesthefollowingissues:
•Access,AssessmentandcontinuityofCare(AAC)
•PatientRightsandEducation(PRE)
•CareofPatient(COP)
•ManagementofMedication(MOM)
•HospitalInfectioncontrol(HIC)
•ContinuousQualityImprovement(CIQ)
•ResponsibilityofManagement(ROM)
•FacilityManagementandSafety(FMS)
•HumanResourceManagement(HRM)
•InformationManagementSystem
ThestepsinvolvedinachievingaccreditationtotheNABHstandardare:
•UnderstandtheNABHStandard
•CarryoutSelfassessmentvis-à-visstandard
•Identifygapsanddrawactionplan
•Prepareprotocolsatdepartmentlevel
•Developpolicy&proceduredocumentation
•Implementationoftheprocedures
•Submitapplicationformforassessment
•Payaccreditationfees
•Pre-assessmentaudit
2.3.2 HowtoachieveaccreditationtotheNABHstandard?

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•Takecorrectiveactions
•Accreditationaudit
•Receiverecommendation-Accreditation
Any organization in the Hospital and Healthcare industry can go in for this
accreditation.
ISO/TC 16949:2002 is a standard that is applicable to organizations in the
automotive industry. This standard has been based on ISO 9001:2008 and
supersedes the QS 9000 standard. This standard was prepared by the
International Automotive Task Force (IATF) and Japan Automobile
Manufacturers Association (JAMA) with support from ISO/TC 176. The goal
of this Technical Specification is the development of a QMS that provides for
continual improvement, emphasizing defect prevention and the reduction of
variationandwasteinthesupplychain.
An Organization that has already implemented ISO9001:2008 can upgrade
to ISO/TS 16949:2002 by setting up additional documents to include the
additionalrequirementsofthisstandard.
Every organization desirous of achieving certification to this standard must
•Prepare Quality Manual and other documents required to define the
processes
•Set functional objectives and create system for measurement and
monitoring
system
2.3.3 WhichorganizationscanapplyforaccreditationtoNABHStandard?
2.4 Certification to the ISO/TS 16949:2002 standard for Automotive
Industry
2.4.1 WhatisISO/TS16949:2002?
2.4.2 HowtoachievecertificationtoISO/TS16949:2002?

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•ReviewbytheSeniorManagementoftheorganization
•ConductthirdpartyassessmentandObtaincertification
Thisstandardisapplicabletoallorganizationsintheautomotiveindustry.
ISO 22000:2005 specifies requirements for a food safety management
system where an organization in the food chain needs to demonstrate its
ability to control food safety hazards in order to ensure that food is safe at the
time of human consumption. The standard involves the elements of
interactive communication, system management, prerequisite programmes
and HACCP principles. Communication along the food chain is essential to
ensure that all relevant food safety hazards are identified and adequately
controlled at each step within the food chain. This implies communication
between organizations both upstream and downstream in the food chain.
Communication with customers and suppliers about identified hazards and
controlmeasureswillassistinclarifyingcustomerandsupplierrequirements.
ISO 22000 has been aligned with ISO 9001:2008 in order to enhance the
compatibility of the two standards. ISO 22000 can be applied independently
of other management system standards or integrated with existing
managementsystemrequirements.
Every organization desirous of achieving certification to this standard must
•Prepare Documentation including Food Safety Policy required by
thestandard
2.4.3 WhichorganizationscanapplyforcertificationtoISO/TS16949:2002?
2.5 CertificationtotheISO22000:2005standardforFoodSafety
2.5.1 WhatisISO22000:2005?

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•Assist in conducting hazard analysis and reducing it to acceptable
level
system
•ReviewbytheSeniorManagementoftheorganization
•ConductthirdpartyassessmentandObtaincertification
It is applicable to all organizations, regardless of size, which are involved in
anyaspectofthefoodchainandwanttoimplementsystemsthatconsistently
providesafeproducts.

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CHAPTER 3 : PROCESS / PERFORMANCE IMPROVEMENT
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3.1 SixSigma
3.1.1 WhatisSixSigma?
3.1.2 BenefitsofSixSigma
Six Sigma is a rigorous & disciplined methodology that uses data & statistical
analysis to improve operational performance by reducing the defects that
occurasaninherentnatureoftheprocess.TheSixSigmamethodologyuses
a specific problem solving approach and selected Six Sigma tools to improve
processes and products. This methodology is data driven and the goal is to
reduceunacceptableproductsorevents.
The original goal of Six Sigma methodology was to reduce process variation
such that the number of unacceptable products would be no more than 3.4
parts per million (PPM).As currently practiced by most companies, however,
thereal–worldapplicationofSixSigmaistomakeaproductthatsatisfiesthe
customerandminimizessupplierlosses.
Successful implementation of Six Sigma methodology requires
organizations to have data relating to their operations. If the data is not
availablethereisaneedtosetupsystemstocollectdata.
Six Sigma can be applied to all types of organizations – Manufacturing,
Service, BPO's etc. The reports regarding Mumbai's dabbawalas achieving
SixSigmacompliancedemonstratestheversatilityofthetechnique.
SixSigmaimplementationcanprovidethefollowingbenefits:-
•Reductionindefects
•Improvedcustomersatisfaction
•Reductionincycletime
•Improvedresourceutilization
•CostReduction
•Bettercontrolontheoperation

3.1.3 Typicalapplications
3.1.4 MethodologyandCompany'srole
Six Sigma can be applied to all functions within an organization. Some of the
examplesare:
Thefirststepistoidentifyareasthatneedtobeaddressedandcreateproject
teams that will be assigned responsibility for addressing the issues. Top
management commitment is essential and the project team members need
to undergo training to be designated as Green belt, Black Belt and Master
Black Belt. The team should consist of members drawn from all the affected
areas.
SixSigmamethodologyisgenerallydefinedthroughthefollowingsteps:
D–Define–Referstoaccuratelyandcompletelydefiningtheproblem
M – Measure – Create systems for measurement of defined parameters /
collectionofdata
A – Analyze –Use of statistical tools to identify the root causes and possible
solutions
I–Improve–Bringaboutimprovementsbyimplementingthesolution
C–Control–Institutemeasurestoensuresustainabilityoftheimprovement
20
Astute Consulting
Sr. No. Function Areas of Improvement
1 Commercial / Finance •Cost Reduction
•Working Capital optimization
•Document Processing Time
2 Operations / Quality Control •Reduction in defects / rejections
•Reduced inspection stages
•Reduction in cycle time
•Reduction in downtime
3 Logistics •Improved inventory turnaround
•Improved delivery performance
•Reduction in transportation costs
4 Human Resources •Reduction in staff turnover
5 Marketing and Sales •Improved Enquiry to Order ratio
•Greater levels of customer
satisfaction

Astute Consulting
3.2 DiagnosticStudyLeadingtoBusinessImprovement
3.2.1 WhatisDiagnosticStudy?
3.2.2 BenefitsofDiagnosticStudy
3.2.3 AreascoveredbytheDiagnosticStudy
Every organization is interested in getting a fair view of its strengths and
weaknesses through an independent assessment process. A diagnostic
study fulfills this need. Diagnostic study refers to a detailed review of various
operational areas of an organization with a view to benchmark them against
internationally accepted best practices and arriving at areas of concern.
These are then prioritized for initiating corrective actions. The diagnostic
study also includes identification of appropriate corrective actions and an
actionplanwithatimetableandresponsibilitymatrix.
Each functional area and activity being performed is subjected to a critical
evaluation. The actual conduct of the process and its effectiveness are
benchmarked against the best practices followed by internationally
successful organizations. Thus, the diagnostic study brings up issues that
may not come up in normal reviews. Since it is conducted by an independent
agency, it is objective and fair.Astute's experts look into the relevance of the
activities with reference to the goals set by the organization while conducting
the study. Thus the results help the management to get a very accurate
assessmentofitsactivitiesandidentifyareasthatneedattention.
Typically,thefollowingareasarecovered:
21
Sr.
No. Area Elements
1 Organisational Profile üOrganisational Environment
üOrganisational Relationships
üCompetitive Environment
üStrategic Challenges
üPerformance Improvement System
2 Leadership üVision and values
üCommunicationandOrganisationalPerformance
üOrganisational Governance
üLegal & Ethical behaviour
üSupport of key communities

3 Strategic Planning üStrategy Development Process
üStrategic Objectives
üAction Plan Development and
Deployment
üPerformance Projection
4 Customer and Market Focus üCustomer and Market Knowledge
üCustomer Relationship Building
üCustomer Satisfaction Determination
5 Knowledge Management üPerformance Measurement
üPerformance Analysis and Review
üData and Information Availability
üData,InformationandKnowledgeQuality
6 Human Resource Focus üOrganisation and Management of Work
üEmployee Performance Management
System
üHiring and career Progression
üEmployee Education, Training and
Development
üMotivation and Career Development
üWork Environment
üEmployee Support and Satisfaction
7 Process Management üValue Creation Processes
üSupport Processes
üOperational Planning
8 Business Results üProduct and Service Results
üCustomer Focused Results
üFinancial and Market Results
üHuman Resource Results
üOrganisational Effectiveness Results
üLeadership and Social Responsibility
Results
3.2.4 MethodologyandCompany'sRole
The Diagnostic Study includes interactions with all the stakeholders of the
organization. Besides meeting and eliciting the views of the top
management, our experienced consultants will carry out the study through a
combinationofinterviewswithoperatingpersonnel,inspectionoftherecords
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Astute Consulting
Sr.
No. Area Elements

23
Astute Consulting
and observation of the activities as they are performed. If required and with
your consent, we will visit your customers and suppliers to obtain feedback
regarding their perception of your organization. It is necessary that the
organizationnominatesacoordinatortofacilitatetheaboveprocess.
Subsequent to the Diagnostic Study, Astute will assist the organization in
implementingtheidentifiedcorrectiveactions.
In the current business scenario, cost optimization is an ongoing goal for an
organization. Increased competition has made it necessary for every
organization to be conscious of optimizing its costs in several areas. Though
an organization has in existence good systems and procedures to optimize
its costs, a periodic review must be undertaken to evaluate the effectiveness
of such systems and procedures and also look at possibilities for
improvement. By resorting to such reviews, the organization can continue to
focusonareasofcostoptimization.
The nature of operations of an organization provides a clue regarding the
areaofcostoptimization.Foranymanufacturingorganization,materialscost
optimization is an essential area while for service organizations,
administrative areas may offer an opportunity for cost optimization.
Manpower costs need to be reviewed in order to set benchmarks for
productivity and utilization. Solid leadership and continuously paying
attentiontoarazor-sharpimplementationareessentialtosuchanapproach.
3.3 Cost Optimization – Materials / Manpower / Establishment &
Administrative
3.3.1 Introduction
3.3.2 Avenuesforcostoptimization

Astute Consulting
24
4.1 WhyEnterpriseRiskmanagement(ERM)
4.2 Regulatoryrequirement
4.3 TheSolution
Today'sbusinessesacrosstheglobeseekfor
•betterdecision-making,
•greatershareholdervalueand
•strongerinternalcontrols.
In the wake of dynamic market conditions and regulatory initiatives,
protecting shareholders' interests is becoming a top priority for boards.
External perceptions of a company are affected by a level of risk that it faces
and the way its risks are being managed. No business is immune to Risk,
managing it to create a sustainable shareholder value is a critical challenge.
Businessesneedsmartsolutionforthispurpose.
The Clause 49 of the Listing agreement, which comes into effect on 1
January2006,says,
“The Company shall lay down procedures to inform board members about
the risk assessment and minimization procedures. These procedures shall
be periodically reviewed to ensure that executive management controls risk
throughmeansofaproperlydefinedframework.”
The clause also makes the CEO/CFO certification on Internal Controls
mandatory.
An enterprise wide initiative involving all levels of management and steered
by the Board of directors is a need of the hour.Awell-defined Internal Control
Framework and structured approach to risk management can, not only limit
thedamagetothecompanybutalsoenableitcaptureopportunities.
CHAPTER 4 : ENTERPRISE RISK MANAGEMENT AND
INTERNAL CONTROL FRAMEWORK

Astute Consulting
25
4.4 BusinessBenefits
Potential benefits of adopting integrated approach to Internal Control & ERM
frameworkswouldbe
Greater likelihood of
achieving business
objectives
Reduction in
management time spent
in fire fighting
Ability to respond quickly
to market demands & avoid
losses
Lower cost of
capital
Better strategy setting
& implementation
Risk Identification
Business
Objectives
Future
R
isks
PresentR
isks
K
nown
R
isks
U
nknow
n
R
isks
Risk Management
Risk Assessment
RiskMitigation
RiskControl
Processes
and
Systems
Risk Reporting
Board of Directors
Senior Management
Operating Management
Internal Controls
Risk Identification
Business
Objectives
Future
R
isks
PresentR
isks
K
nown
R
isks
U
nknow
n
R
isks
Risk Management
Risk Assessment
RiskMitigation
RiskControl
Processes
and
Systems
Risk Reporting
Board of Directors
Senior Management
Risk Identification
Business
Objectives
Future
R
isks
PresentR
isks
K
nown
R
isks
U
nknow
n
R
isks
Risk Management
Risk Assessment
RiskMitigation
RiskControl
Processes
and
Systems
Risk Reporting
Board of Directors
Senior Management
Internal Controls

Astute Consulting
26
5.1 WhyDocumentSystems/Procedures?
5.2 What Are Good Documentation Practices?
“An hour spent in documenting at 2 PM may prevent an emergency at 2AM”.
The importance of documentation cannot be over emphasized. As
organizations grow, they cannot depend only on individual brilliance to
ensure compliance to processes. An organization can sustain its
performance levels only if the systems are documented and made available
toitsoperatingpersonnelinanunambiguousmanner.
Gooddocumentationaddressesthefollowingissues:
§Audience is well identified – The personnel to whom the document
is addressed are to be identified before setting out to prepare the
document.
§Contents are well researched – The subject matter of the document
must be well defined and should be self explanatory. The reader
shouldbeabletounderstanditwithoutsomeonehavingtoexplainit.
§Purpose is well understood – It is important to know as to why the
document is being prepared – What is the user going to derive from it?
Thisknowledgewillensurethattheeffectivenessofthedocumentisto
thedesiredextent.
§Documents are dynamic – All documentation should be viewed as
“living” documents. Once written, it should not be tossed aside and
forgotten. Any failure to keep the document updated will bring the
entireexerciseintoseriousdoubt.
§Documents must be well advertised – There has to be adequate
effort to make all concerned aware of the existence of the
documentation so that they will be inclined to study and follow the
same.
CHAPTER 5 : DOCUMENTATION OF SYSTEMS,
PROCEDURES, SOPS

Astute Consulting
27
AstuteConsultingGroup(Astute)isoneoftheleadingaccountingandmanagement
consultancy groups in India. It is Indian member of RSM International, the seventh
largest international organization of accountants and business advisors with annual
billings of about US$ 3.06 billion and offices in 64 countries. RSM International is
th
founded by RSM McGladrey, the 5 largest accounting and consulting group in the
US(nextonlytotheBig4).
Our multi-disciplinary team of over 750, comprises of Chartered Accountants,
MBAs, Engineers, Company Secretaries, System Professionals and Cost
Accountants. With their respective competencies, our professionals are capable of
developing the required competitive advantage and sustainable value for a wide
rangeofbusinesses.
Astute operates through its offices in 10 cities viz. Mumbai, New Delhi, Chennai,
Kolkata, Surat, Bangalore, Hyderabad, Ahmedabad, Gandhidham and
Visakhapatnam, facilitating servicing of clients across India in a cost effective
manner.
”To partner with our clients to facilitate achievement of their strategic
objectives through creative solutions which integrate people,
processes & technology.”
3OperationsConsulting
3QualityManagementSystems(includingISO)
3InternalandManagementAudits(includingTechnoCommercialAudits)
3InternationalandIndianTaxation
3CorporateAdvisoryandStructuring
3AttestationServices
3AccountingandBusinessProcessOutsourcing
3LegalandCommercialDocumentation
MISSION
SERVICES
ABOUT ASTUTE CONSULTING GROUP

Astute Consulting
28
Some of our services for Operations Consulting and Quality Management
Systemsinclude:
3Preparing Plan for making the organization compliant with the
requisitestandard
3Developing policies and procedures to address the various
requirementsofvariousstandards
3Preparing documentation of the system as per requirements of
variousstandards.
3Implementingthedocumentedsysteminaneffectivemanner
Assistancein compliancewithvariouslegalrequirements
3Trainingofpersonnel
3Conductinginternalaudits/periodicreviews
3Assistanceduringthirdpartyaudits
3Assistanceincertification/recertificationaudit
3Closure of non conformities and developing corrective and preventive
actions

Astute Consulting
NOTES

Astute Consulting Group is the sole Indian member of RSM International, the seventh largest
accounting and business advisory organisation worldwide.
Astute Consulting Group
Mumbai
3rd Floor, Ahura Centre,
82, Mahakali Caves Road,
Andheri (E), Mumbai - 400 093.
602/603, Regent Chambers,
208, Nariman Point,
Mumbai - 400 021.
608, Sagar Tech Plaza B,
Sakinaka, Andheri (E),
Mumbai - 400 072.
New Delhi
F-116, Himalaya House,
23, K. G. Marg, Connaught Place,
New Delhi - 110 001.
Chennai
1A, Chamiers Apartments,
62/121, Chamiers Road,
R. A. Puram, Chennai - 600 028.
Kolkata
2058/A, Mercantile Buildings,
Block "A", 9, Lalbazar Street,
Kolkata - 700 001.
Bangalore
2nd Floor, No. 546,
C.M.H. Road, Indiranagar,
Bangalore - 560 038.
Surat
604-605, Tirupati Plaza,
Athwa Gate, Nanpura,
Surat - 395 001.
T-720, Belgium Tower,
Opp. Linear Bus Stop,
Ring Road, Surat - 395 002.
Hyderabad
Office No. 5, 3rd Floor,
Farhat Afza Building, Road No.10,
Banjara Hills, Hyderabad - 500 034.
Ahmedabad
504, Narnarayan Complex,
Navrangpura,
Ahmedabad - 380 009.
Gandhidham
216, Golden Arcade, Oslo Road,
Plot No.141 & 142, Sector 8,
Gandhidham - 370 201.
Visakhapatnam
No. 9, Merrylife Apartments,
Doctors Colony, Peda Waltair,
Visakhapatnam - 530 017.
Network Associate-Kochi & Thiruvananthapuram
K.Venkatachalam Aiyer & Co.,
41/3647B, Blue Bird Towers,
Providence Road, Kochi - 682 018.
Tel : (91-22) 6696 0644 / 2287 5770
Email : emails@astuteconsulting.com
Fax : (91-22) 2820 5685 / 2287 5771
URL : www.astuteconsulting.com

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