Selecting the Right Compliance Management Solution for Your Organisatoin

Selecting the right compliance management solution for your organisation can be a daunting task. Executed poorly and you could be stuck with a white elephant that exposes your organisation to unacceptable noncompliance risks and costs. Executed correctly and you can be rewarded with a robust business tool that not only identifies the sources of noncompliance but prevents noncompliant items being supplied to internal and external customers.

Define Your Compliance Assessment & Control Requirements

As with any major purchasing decision, the single most important thing you can do to ensure success is to form a clear understanding of your organisation’s compliance assessment and control objectives before you start evaluating options.  Unfortunately, this is where a lot of organisations come unstuck.

100% Inspection

The simplest and most effective method of assessing noncompliances is 100% inspection.   The major benefit of this methodology is that as soon as a noncompliance is identified immediate steps can be taken to address the cause of noncompliance and items can be removed and/or corrected before they are inadvertently supplied to a customer.  Unfortunately, this can be very time consuming and expensive process; especially where large quantities of items are involved.

Sampling Inspection / Auditing

The affordable and more commonly used alternative to 100% inspection is sampling, whereby the compliance level of a small number of randomly selected items is used to estimate the compliance level of a much larger population or batch of items.  Sounds ideal?  Well, not exactly.

Balancing Sampling Risks and Costs

What a lot of organisations fail to understand is that regardless of how unbiased the sample selection process may be there is always a risk that the items in a sample will not be representative of those in the batch.  Therefore there is always a risk that a “good” batch will be assessed as unacceptable and a “bad” batch assessed as acceptable.   This is what is commonly referred to as sampling risk.

The easiest way to reduce sampling risk is to increase the sample size; but at what point does this become impracticable from a cost perspective?  Fortunately there are internationally recognised statistical Acceptance Sampling Standards available (i.e. AS 1199:1) that describe how organisations can achieve the optimum balance between their sampling costs and sampling risks,  but for the most part they require an in-depth understanding of statistics; something a lot of organisations don’t have.  This might explain why so few organisations include this requirement in their compliance management solution selection process.

Available Software Solutions

Unfortunately, this situation is not helped by the myriad of software applications on the market that profess to be “complete” compliance management solutions yet fail to include the features needed to accurately and cost effectively measure, assess and control noncompliance levels within a sampling inspection and risk management framework; that is until now.

Compliance Master® is the first web-based compliance management application to use internationally published statistical acceptance sampling methods to asses and control noncompliances.  The software includes the following features;
– assess  the “total number of noncompliances per 100 items” or “percentage noncompliant items”,
– categorise item attributes according to their noncompliance risk,
– specify an acceptable noncompliance limit for each risk category,
– select different inspection levels to strike the optimum balance between sample size and sample risk,
– create a tailored attribute checklist for each batch inspection,
– register and assign suitably qualified inspectors to each inspection,
– enter inspection results remotely over the Internet,
– receive automatic warnings should a registered organisation, process or individual continually exceed the specified noncompliance limit.

To learn more about how Compliance Master® can help your organisation can quickly implement a rigorous statistical based compliance assessment and control system visit our website at www.compliance-master.com or give us a call on +61 1300 827 933.

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