ISO-accreditation a must for local firms to compete

CEBU, Philippines - Moving toward international standardization in operations has become more significant for both small and big businesses considering the more liberalized trading among economies.

To take advantage of the integrated economy in the ASEAN region and better position in the regional competition, Philippine enterprises must certify with ISO International Standards.

Jong Fernandez, general manager and CEO of AGF Training & Consulting, said foreign companies would choose to trade with local firms here which are ISO-certified. AGF is an ISO-based management systems consulting firm based in Cebu.

"The direction of our country should really be toward standardization. We know that there is 2015 ASEAN economic integration," Fernandez told The FREEMAN in an interview.

Standard certification

While dollar is considered as the international standard money in currency, ISO is likewise the standard in worldwide business.

ISO is an international standard certification that ensures the required management system, manufacturing process and documentation are being undertaken by businesses for standardization and quality assurance.

International Organization for Standardization is a non-government international body that homogenizes how enterprises and organizations handle information and processes.

It develops International Standards such as ISO 9001 and ISO 22000 that ensure products and services are safe and of good quality. ISO 9001 (quality management) and ISO 14001 (environmental management) are the most common ISO certifications and are generic management system standards.

"It refers to different kinds of voluntary standards that businesses should actually adopt," he further explained of the certification which can be a tool to increase a business' credibility.

The Department of Trade and Industry's Bureau of Product Standards is the country's full member to ISO and is also promoting standards to different regulatory government agencies.

Fernandez pointed out that a number of small and medium sized enterprises, which account 99.6 percent of all registered businesses in the country, are still not wary on the importance of ISO certification.

The high cost, he said, is one factor that prevents SMEs to be certified and adhere to international principles.

"Well, it would really entail a significant investment which is usually the hindrance of SMEs. Instead of thinking it as a cost, we're trying to educate them that it's a necessary investment," he said.

He also noted the investment cost could range from P300,000 to P2 million, depending on the size of the business and the number of processes. The certification period takes a maximum of six months, involving two months of planning and four months of actual implementation.

ISO is not the one that issues certificates but external certification bodies. But ISO's Committee on Conformity Assessment has produced more than 19,000 International Standards related to the certification process.

'Be certified when still small'

The CEO added it is better and wise for a business to be certified with ISO when still small because the certification cost could still be manageable and it's the right time to set up a system.

"Kasagaran nila (SMEs) are intimidated nga para ra man sa dagko ang ISO. It's not a luxury for big companies, maybe in the past that may be true but now because of ASEAN economic integration, it is becoming critical (for any type of business)," he explained.

ISO standards impact the regulatory side of a company, its efficiency, quality, productivity and competitiveness and help it access new markets. Fernandez also added ISO eases free and fair global trade.

He said: "If you're not certified the implication is di consistent imong quality. It improves competitiveness because of the principle of continued improvement. ISO is basically anchored on that principle."

Critical industries in the Philippine economy such as power, construction, food and utilities must be educated on the role of standardization as the country moves toward integration next year, he said.  (FREEMAN)