External and Internal Issues

ISO 9001:2015, 4.1, Understanding the organization and its context, states that an organization must determine the internal and external issues that are relevant to its purpose and strategic direction, and that affect its ability to achieve the intended quality results.

It also requires the organization to monitor and review information about these external and internal issues.

Note 1 in the standard says that issues can include positive and negative factors or conditions for consideration.
Note 2 states that understanding the external context can be facilitated by considering issues arising from legal, technological, competitive, market, cultural, social and economic environments, whether international, national, regional or local.
Note 3 states that understanding the internal context can be facilitated by considering issues related to values, culture, knowledge and performance of the organization.

The intent of clause 4.1 is to understand the external and internal issues that are relevant to the organization’s purpose and strategic direction and that can affect, either positively or negatively, the organization’s ability to achieve the intended results of its quality management system.

The organization should be aware that external and internal issues can change, and therefore, should be monitored and reviewed. An organization might conduct reviews of its context at planned intervals and through activities such as management review.

According to ISO/TS 9002:2016, information about external and internal issues can be found from many sources, such as through internal documented information and meetings, in the national and international press, websites, publications from national statistics offices and other government departments, professional and technical publications, conferences and meetings with relevant agencies, meetings with customers and relevant interested parties, and professional associations
Examples of external and internal issues relevant to the organization’s context can include, but are not limited to:

a) external issues related to:

1) economic factors such as money exchange rates, economic situation, inflation forecast, credit availability;
2) social factors such as local unemployment rates, safety perception, education levels, public holidays and working days;
3) political factors such as political stability, public investments, local infrastructure, international trade agreements;
4) technological factors such as new sector technology, materials and equipment, patent expirations, professional code of ethics;
5) market factors such as competition, including the organization’s market share, similar products or services, market leader trends, customer growth trends, market stability, supply chain relationships;
6) statutory and regulatory factors which affect the work environment (see ISO 9001:2015, 7.1.4) such as trade union regulations and regulations related to an industry;

b) internal issues related to:

1) overall performance of the organization;
2) resource factors, such as infrastructure (see ISO 9001:2015, 7.1.3), environment for the operation of the processes (see ISO 9001:2015, 7.1.4), organizational knowledge (see ISO 9001:2015, 7.1.6);
3) human aspects such as competence of persons, organizational behavior and culture, relationships with unions;
4) operational factors such as process or production and service provision capabilities, performance of the quality management system, monitoring customer satisfaction;
5) factors in the governance of the organization, such as rules and procedures for decision making or organizational structure.

At the strategic level, tools such as Strengths, Weaknesses, Opportunities and Threats analysis (SWOT) and Political, Economic, Social, Technological, Legal, Environmental analysis (PESTLE) can be used. A simple approach can be useful for organizations dependent on the size and complexity of their operations, such as, brainstorming and asking “what if” questions.

The next two articles give examples of external and internal issues.