Risk based Thinking

ISO 9001:2015 Risk Based Thinking

One of the key changes in the 2015 revision of ISO 9001 is to establish a systematic
approach to risk, rather than treating it as a single component of a quality management
system. In previous editions of ISO 9001, a clause on preventive action was separated
from the whole. Now risk is considered and included throughout the standard. By taking
a risk-based approach, an organization becomes proactive rather than purely reactive,
preventing or reducing undesired effects and promoting continual improvement.
Preventive action is automatic when a management system is risk-based.Risk-based
thinking is something we all do automatically and often sub-consciously. for e.g if I wish
to cross a road I look for traffic before I begin. I will not step in front of a moving car. The
concept of risk has always been implicit in ISO 9001 this revision makes it more
explicit and builds it into the whole management system. The risk is considered from the
beginning and throughout the standard, making preventive action part of strategic
planning as well as operation and review. Risk-based thinking is already part of the
process approach. For e.g to cross the road I may go directly or I may use a nearby
footbridge. Which process I choose will be determined by considering the risks. Riskbased thinking makes preventive action part of the routine. Risk is often thought of only
in the negative sense. Risk-based thinking can also help to identify opportunities. This
can be considered to be the positive side of risk. Crossing the road directly gives me an
opportunity to reach the other side quickly, but there is an increased risk of injury from
moving cars. The risk of using a footbridge is that I may be delayed. The opportunity of
using a footbridge is that there is less chance of being injured by a car.Opportunity is
not always directly related to risk but it is always related to the objectives. By
considering a situation it may be possible to identify opportunities to improve.The
opportunities for improvement: a subway leading directly under the road, pedestrian
traffic lights, or diverting the road so that the area has no traffic. It is necessary to
analyse the opportunities and consider which can or should be acted on. Both the
impact and the feasibility of taking an opportunity must be considered. Whatever action
is taken will change the context and the risks and these must then be reconsidered.
Identify what your risks are it depends on context
Example:
If I cross a busy road with many fast-moving cars the risks are not the same as if the
road is small with very few moving cars. It is also necessary to consider such things as
weather, visibility, personal mobility and specific personal objectives.
Understand your risks
What is acceptable, what is unacceptable? What advantages or disadvantages are
there to one process over another?

Example:
Objective: I need to safely cross a road to reach a meeting at a given time.

It is UNACCEPTABLE to be injured.

It is UNACCEPTABLE to be late.

Reaching my goal more quickly must be balanced against the likelihood of injury. It is
more important that I reach my meeting uninjured than it is for me to reach my meeting
on time.
It may be ACCEPTABLE to delay arriving at the other side of the road by using a
footbridge if the likelihood of being injured by crossing the road directly is high.I analyse
the situation. The footbridge is 200 metres away and will add time to my journey. The
weather is good, the visibility is good and I can see that the road does not have many
cars at this time. I decide that walking directly across the road carries an acceptably low
level of risk of injury and will help me reach my meeting on time.
The Main Objectives Of ISO 9001 to provide confidence in the organizations ability to
consistently provide customers with conforming goods and services and to enhance
customer satisfaction. The concept of risk in the context of ISO 9001 relates to the
uncertainty in achieving these objectives.
Plan actions to address the risks
How can I avoid or eliminate the risk? How can I mitigate risks?
Example: I could eliminate risk of injury caused by being hit by a vehicle if I use the
footbridge but I have already decided that the risk involved in crossing the road is
acceptable. Now I plan how to reduce either the likelihood or the impact of injury. I
cannot reasonably expect to control the impact of a car hitting me. I can reduce the
probability of being hit by a car. I plan to cross at a time when there are no cars moving
near me and so reduce the likelihood of an accident. I also plan to cross the road at a
place where I have good visibility.
Implement the plan take action
Example:
I move to the side of the road, check there are no barriers to crossing. I check there are
no cars coming. I continue to look for cars whilst crossing the road.
Check the effectiveness of the action does it work?
Example:

I arrive at the other side of the road unharmed and on time: this plan worked and
undesired effects have been avoided.
Learn from experience improve
Example:
I repeat the plan over several days, at different times and in different weather
conditions. This gives me data to understand that changing context (time, weather,
quantity of cars) directly affects the effectiveness of the plan and increases the
probability that I will not achieve my objectives (being on time and avoiding
injury). Experience teaches me that crossing the road at certain times of day is very
difficult because there are too many cars. To limit the risk I revise and improve my
process by using the footbridge at these times. I continue to analyse the effectiveness
of the processes and revise them when the context changes. I also continue to
consider innovative opportunities:

can I move the meeting place so that the road does not have to be crossed?

can I change the time of the meeting so that I cross the road when it is quiet?

can we meet electronically?

DEFINITIONS
ISO 9001:2015 defines risk as the effect of uncertainty on an expected result.
1.

An effect is a deviation from the expected positive or negative.

2.

Risk is about what could happen and what the effect of this happening might be.

3.

Risk also considers how likely it is.

The target of a management system is achieve conformity and customer satisfaction.

Explanation:
Risk is the possibility of events or activities impeding the achievement of
an organizations strategic and operational objectives. It is the volatility of potential
outcomes. Risk can be defined by two parameters

Severity (This is the Seriousness of the harm)

Probability (This is the Probability that the harm will occur)

Risk as Currently Stated in ISO 9001:2015

ISO 9001:2015 uses risk-based thinking to achieve this in the following way:

Clause 4 (Context) the organization is required to determine the risks which

may affect this.The organization is also required to determine its QMS
processes and to address its risks and opportunities

Clause 5 (Leadership) top management are required to commit to ensuring

Clause 4 is followed. Top management is required to

Promote awareness of risk-based thinking

Determine and address risks and opportunities that can affect
product /service conformity

Clause 6 (Planning) The organization is required to identify risks and

opportunities related to QMS performance and take appropriate actions to
address them

Clause 7 (Support) the organization is required to determine and provide

necessary resources (risk is implicit whenever suitable or appropriate is
mentioned)

Clause 8 (Operation)the organization is required to manage its operational

processes (risk is implicit whenever suitable or appropriate is
mentioned). The organization is required to implement processes to address
risks and opportunities.

Clause 9 (Performance evaluation) the organization is required to monitor,

measure, analyse and evaluate the risks and opportunities.

Clause 10 (Improvement) the organization is required to correct, prevent or

reduce undesired effects and improve the QMS and update risks and
opportunities.

ISO 9001:2015 subclause 4.4.1QMS and it processes

The organization shall establish, implement, maintain and continually improve a
quality management system, including the processes needed and their interactions,
in accordance
with
the
requirements
of
this
International Standard.
The organization shall determine the processes needed for the quality management
system and their application throughout the organization and shall determine:
organization
shall:
f) address the risks and opportunities as determined in accordance with the
requirements of 6.1
The organization must integrate the actions to address risks and opportunities into its
QMS processes using the PDCA cycle. Not all processes of a quality management
system represent the same level of risk in terms of the organizations ability to meet its

objectives and the effects of uncertainty are not the same for all organizations. Each
organization is therefore responsible for the extent it applies risk-based thinking and the
actions it takes to address risk, including whether or not to retain documented
information as evidence of its determination of risks. 5.1.2Leadership and
commitment with respect to the needs and expectations of customers
ISO 9001:2015 subclause 5.1.1General under leadership and commitmentment
Top management shall demonstrate leadership and commitment with respect to the
quality management system by:
d) promoting the use
of the process approach and risk-based thinking;
ISO 9001:2015, requires that when planning its QMS, the top management must
implement and promote a culture of risk-based thinking throughout the organization to
determine and address the risks and opportunities associated with providing assurance
that the QMS can achieve its intended result(s); provide conforming products and
services, enhance customer satisfaction; promote desirable effects and improvement;
and prevent, or mitigate, undesired effects.
ISO 9001:2015 subclause 5.1.2Customer focus
Top management shall demonstrate leadership and commitment with respect to
customer
focus
by
ensuring
that:
b) the risks and opportunities that can affect conformity of products and services and
ability to enhance customer satisfaction are determined and addressed;
This can be achieved by establishing process capabilities for each process from
manufacturing and assembly to packaging and product delivery and installation. The
computation of a simple indicator of process capability (Cp) or the adjustment of the
process capability toward a specification (Cpk) would help managers quantify their
process risk. The objective would be to achieve the highest economically feasible
capability for each process, thus minimizing the risk of producing so-called unintended
output.
6.1Actions to address risks and opportunities
6.1.1 When planning for the quality management system, the organization shall
consider the issues referred to in 4.1 and the requirements referred to in 4.2 and
determine the risks and opportunities that need to be addressed to:
a) giving assurance that the quality management system can achieve its intended
result(s)
b) enhance
desirable
effects
c)
prevent,
or
reduce,
undesired
effects,
and
d)
achieve
improvement.
6.1.2 The
organization
shall
plan:
a)
actions
to
address
these
risks
and
opportunities,
and
b)
how
to
1) integrate and implement the actions into its quality management system processes

(see
4.4),
and
2)
evaluate
the
effectiveness
of
these
actions.
Any actions taken to address risks and opportunities shall be proportionate to the
potential impact on conformity of goods and services and customer satisfaction.
The organization must integrate the actions to address these risks and opportunities
into its QMS processes using the PDCA cycle. Not all processes of a quality
management system represent the same level of risk in terms of the organizations
ability to meet its objectives and the effects of uncertainty are not the same for all
organizations. Each organization is therefore responsible for the extent it applies riskbased thinking and the actions it takes to address risk, including whether or not to retain
documented information as evidence of its determination of risks. When planning its
QMS, the organization must consider the risks and opportunities presented by external
and internal issues as well as the needs and expectations of interested parties, relevant
to its purpose and strategic direction Means to address risks may include avoiding risk,
taking risk in order to avail an opportunity, removing the source of the risk, changing the
likelihood or consequences, sharing the risk, or making an informed decision to retain
the risk. Opportunities can derive from favorable circumstances that can lead to the use
of new practices, launch new products, enter new markets, address new clients, reduce
waste or improve productivity, grow relationships, use new technology and other
desirable and viable opportunities to facilitate the organization in achieving its strategic
direction and enhance customer satisfaction.
9.1.3 Analysis and evaluation
The organization shall analyse and evaluate appropriate data and information arising
from
monitoring and
measurement.
The
results
of
analysis
shall
be
used
to
evaluate:
e) the effectiveness of actions taken to address risks and opportunities;
Planning also requires monitoring and measuring these actions and gathering,
analyzing and evaluating appropriate data and information to determine the
effectiveness of such actions.
9.3.2 Management review Inputs
The management review shall be planned and carried out taking into consideration:
e) the effectiveness of actions taken to address risks and opportunities (see 6.1)
This planning must be periodically reviewed and updated as necessary when taking
corrective actions or at management reviews. These actions must be proportional to the
potential impact on the conformity of products and services.
10.2.1- Non Conformity and Corrective action
When a nonconformity occurs, including any arising from complaints, the organization
shall:
e) update risks and opportunities determined during planning,if necessary;

One could do failure mode effects and analysis (FMEA) to show that the risk-priority
number has decreased as a result of a process change. This would not be difficult to do
but full of uncertainties because FMEA is based on subjective assessment.

Use of risk based thinking.

By considering risk based thinking throughout the organization the likelihood of
achieving stated objectives is improved, output is more consistent and customers can
be confident that they will receive the expected product or service.
Risk-based thinking therefore:

builds a strong knowledge base

establishes a proactive culture of improvement

assures consistency of quality of goods or services

improves customer confidence and satisfaction

Use of Risk Register

The risk register or risk log becomes essential as it records identified risks,
their severity, and the actions steps to be taken. It can be a simple document,
spreadsheet, or a database system, but the most effective format is a table. A table
presents a great deal of information in just a few pages. There is no standard list of
components
that
should
be
included
in
the
risk
register. Some of the most widely used components are:

Dates: As the register is a living document, it is important to record the date that
risks are identified or modified. Optional dates to include are the target and
completion dates.
Description of the Risk: A phrase that describes the risk.

Risk Type (business, project, stage): Business risks relate to delivery of

achieved benefit;, project risks relate to the management of the project such as
timeframes and resources, and stage risks are risks associated with a specific
stage of the plan.

Likelihood of Occurrence: Provides an assessment on how likely it is that this

risk will occur. Examples are: L-Low >30%)(, M-Medium (31- 70%), H-High
(>70%).

Severity of Effect: Provides an assessment of the impact that the occurrence of

this risk would have on the project.

Countermeasures: Actions to be taken to prevent, reduce, or transfer the risk.

This may include production of contingency plans.

Owner: The individual responsible for ensuring that risks are appropriately
engaged with countermeasures undertaken.

Status: Indicates whether this is a current risk or if risk can no longer arise and
impact the project. Example classifications are: C-current or E-ended.

Other columns such as quantitative value can also be added if appropriate.

Risk-driven approach in organizational processes.

Identify what risks and opportunities are it depends on context. For example If I cross
a busy road with many fast-moving cars the risks are not the same as if the road is
small with very few moving cars. It is also necessary to consider such things as
weather, visibility, personal mobility and specific personal objectives.

1.

Analyse and prioritize your risks and opportunities.

What risk is acceptable, what is unacceptable? What advantages or disadvantages
are there to one process over another? for Example If I need to safely cross a
road to reach a meeting at a given time. It is UNACCEPTABLE to be injured. It is
UNACCEPTABLE to be late. The opportunity of reaching my goal more quickly
must be balanced against the likelihood of injury. It is more important that I reach
my meeting uninjured than it is for me to reach my meeting on time. It may be
ACCEPTABLE to delay arriving at the other side of the road by using a footbridge if
the likelihood of being injured by crossing the road directly is high.I analyse the
situation. The footbridge is 200 metres away and will add time to my journey. The
weather is good, the visibility is good and I can see that the road does not have
many cars at this time. I decide that walking directly across the road carries an
acceptably low level of risk of injury and an opportunity to reach my meeting on
time.

2.

Plan actions to address the risks

How can I avoid or eliminate the risk? How can I mitigate risks? For example I
could eliminate risk of injury by using the footbridge but I have already decided that
the risk involved in crossing the road is acceptable. Now I plan how to reduce the
likelihood of injury and/or the effect of injury. I cannot reasonably expect to control
the effect of a car hitting me. I can reduce the probability of being hit by a car. I
plan to cross at a time when there are no cars moving near me and so reduce the
likelihood of an accident. I also choose to cross the road at a place where I have
good visibility and can safely stop in the middle to re-assess the number of moving
cars, further reducing the probability of an accident

3.

Implement the plan take action

For example I move to the side of the road, check there are no barriers to crossing
and that there is a safe place in the centre of the moving traffic. I check there are
no cars coming. I cross half of the road and stop in the central safe place. I assess
the situation again and then cross the second part of the road.

4.

Check the effectiveness of the actions does it work?

For Example I arrive at the other side of the road unharmed and on time: this plan
worked and undesired outcomes have been avoided.

5.

Learn from experience continual improvement

For example I repeat the plan over several days, at different times and in different
weather conditions. This gives me data to understand that changing context (time,
weather, quantity of cars) directly affects the effectiveness of the plan and
increases the probability that I will not achieve my objectives of being on time and
avoiding injury. Experience teaches me that crossing the road at certain times of
day is very difficult because there are too many cars.To limit the risk I revise and
improve my process by using the footbridge at these times. continue to analyse
the effectiveness of the processes and revise them when the context changes. I
also continue to consider innovative opportunities such as Can I move the meeting
place so that the road does not have to be crossed? Can I change the time of the
meeting so that I cross the road when it is quiet? Can we meet electronically?