Costs and Benefits of ISO9000-based Quality Management Systems to Construction Contractors

Thomas Ng, Ekambaram Palaneeswaran, Mohan Kumaraswamy


ISO9000-based Quality Management Systems(QMSs) have been widely applied by manycontractors with a hope to improve the productquality and hence achieve the desiredobjective of client satisfaction. However,setting up and implementing an ISO9000-based QMS is not without cost. Unless thecontractors can benefit from such system, it isunlikely that the senior management ofcontracting firms will commit to implement anISO9000-based QMS. In this paper, the costsof setting up and implementing an ISO9000-based QMS are assessed through aquestionnaire survey. The results arecompared with the benefits attained by thecontractors. It is found that contractors couldbe benefited from the use of ISO9000-basedQMS both tangibly and intangibly. Based on amore conservative estimation of some tangiblebenefits, a basic operational cost-benefit ratioof one to three was derived from the results ofthe survey. Since the latest version ofISO9000 has been fully implemented for anumber of years, the perception of contractorson the benefits gained after theimplementation of ISO9001:2000 is alsoexamined in this paper.

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