Communications: Partnering With Auditors

Ken Bannister, Contributing Editor

The customs, practices and behaviors exhibited within a workplace are termed “corporate culture,” with each corporation, company, even individual departments revealing and immersing themselves in their own unique cultures.

Living and working within a corporate culture rarely allows an individual the opportunity to perform a cultural self-assessment without bias. That old “I can’t see the forest for the trees” adage clearly sums up our self-assessment inadequacy. The ability to candidly rate ourselves is hindered for a number of specific reasons:

• Lack of knowledge pertaining to a structured audit process
• Clouding of personal judgment due to internal politics and misunderstandings
• Lack of business process knowledge
• Inability to successfully communicate with personnel at all corporate hierarchical levels

Thus, to obtain accurate, unbiased “present state” assessments, an organization will seek out and retain, or in the case of mandatory audits and some voluntary ones, “receive” the services of professional auditors.

How and why assess?
There are various reasons for assessing the current state of a corporate, company and/or departmental culture, including, for example: regulatory compliance, accreditation compliance, licensing compliance, continuous improvement, change management, etc. Most of these reasons will eventually lead to the services of an auditor.

Because auditors are trained in the audit process and are able to view the corporation or department from the “outside in”—without bias—they are better able to deliver a fast, accurate audit assessment. Audits can be divided into mandated and voluntary categories.

• Mandated audits… are compulsory, with the scope of the audit being determined and directed by the regulatory agency performing the audit. Typical mandated audits include: tax audits by the Internal Revenue Service (IRS); validation audits of pharmaceutical or food companies by the Food and Drug Administration (FDA); licensing audits of nuclear power plants by the Nuclear Regulatory Commission (NRC).
• Voluntary audits… are most likely to be selffunded with a self-determined scope. Typical voluntary audits include: ISO certification audits; present “state of maintenance” audits for companies by outside consultants; assessment audits of companies competing for awards by judging/jurying committees (the Malcolm Baldridge Quality Award and North American Maintenance Excellence [NAME] Award are two that come to mind).

Audits—regardless of type—clearly are an important issue for a business. Since maintenance is an integral part of the business, its methods, processes and results can be subject to scrutiny or audit just like those of other departments—at any time. That said, any audit of a maintenance department will tax the organization’s resources. Understanding everyone’s role in the process, therefore, will optimize effort.

Whether working with an internal auditor (many external audits are prepared for by utilizing internal corporate staff to stage a practice or “dry run” audit prior to the real event) or with an external auditor, the maintenance department must communicate with the auditor prior to the event. This is done to determine two very critical elements:

1. the audit scope and
2. the auditor’s requirements.

What, where, how long and by whom?
Audit scope states exactly what is to be audited. In a mandated audit, the auditor will determine and provide the audit scope. For example, a nuclear power plant applying for an operational license can expect the NRC to determine the entire operation within the audit scope. On the other hand, the scope of an environmental spill audit initially will be confined to the immediate spill area.

In a voluntary audit, the corporation, company or department has the right to choose its auditor. Interviewing auditor(s) for suitability in terms of past experience, industry knowledge and their understanding of YOUR business needs is imperative. If two or more auditor candidates meet your technical needs, choose the one you feel the most comfortable partnering with, securing assurances that “who you see, is who you get” during audit time.

The next step is specifically determining and spelling out the audit scope to the auditor.

In a voluntary audit, the corporation determines exactly what is to be audited. For example, if you are undergoing ISO registration, you may choose to just register a single department, production line or process—not the entire plant. This being the case, the auditor will focus only on the methods, processes and records specific to the running and maintaining of that department, line or process.

In both mandatory and voluntary audits, once the audit scope is determined and understood, the auditor must be interviewed to determine the time and duration of the actual audit and the auditor’s requirements. What does he/she want to see? During actual audits, auditors typically have limited time on site. Thus, they often will detail lists of places or items they wish to review during their visits.

Places to see might include the MRO inventory crib or the maintenance tool crib. Items to see might include a Work Order Flow process map or a PM completion report. An auditor might even ask to interview a maintainer on how the maintenance department functions.

The bright side?
Fortunately for most maintenance departments, working with an auditor is an infrequent event. When it does occur, effective communication with the auditor will facilitate the audit process and help place maintenance in a position to grow as a result of the audit findings. MT

Ken Bannister is lead partner and principal consultant for Engtech Industries, Inc. Telephone: (519) 469- 9173; e-mail: kbannister@engtechindustries.com