Sine Qua Non: Quality Management and the Law

Topics such as Industry 4.0 and big data, product safety and product liability come together to produce a critical mass, presenting huge challenges to entire companies. Why not seize this opportunity to redefine the role of quality management as well?

As an industrial lawyer, I am loath to assume that I can assess the present or future of quality management or even make recommendations. Rather, I believe that the role of QM in business is the most useful aid for efficient and structured implementation of the prevalent legal requirements.

Minimizing risks

The number and variety of legal requirements for businesses can no longer be managed in an unstructured way. In addition to the aspects stated above, there is much more pressure from stakeholders who are not part of the company – not only customers, but also users, the authorities and even governmental bodies. Errors are thus noticed more frequently. Furthermore, more and more crisis scenarios occur in companies that maintain no or little structure in their process landscapes vis-a-vis legal requirements. In companies where legal topics are only dealt with when supposed or actual risks are detected, or when damage has already occurred, unrecognized risks resulting from operative business can easily go undetected. They are potentiated on a daily basis because as the company grows, the same erroneous and insufficient processes remain the same and new legal content is not implemented.

Establishing legal requirements effectively

There are several options for solutions, but the efficiency and invasiveness of the measures should be the deciding factors here. Certainly, it is possible that with enough resources, the best option is to monitor products and market conditions individually, as well as reviewing the executed measures and processes and their documentation. But is this actually a kind of company culture and process landscape that can and should exist in the 21st century? Isn’t the focus on process capability within the context of Six Sigma a far clearer sign that companies want to toughen up their processes and secure them, rather than monitoring them or even discarding product? At this point, we come back to legal requirements. The specification limits in the examination of process capability represent an important link to the legal requirements. As a result, the efficient implementation of legal requirements within a company becomes a specification or a corresponding process characteristic which breaks the legal requirements down into relevant components for a specific process step and allocates them dynamically.

Merging QM and legal obligations

Even an industrial lawyer can only tackle this reasonably if the quality management team is involved. In turn, it is clear that the content can only be provided by attorneys who are legally qualified to do so. The objective is thus to have an organization that uses a closed-loop process to recognize legal requirements in a self-learning methodology, implements the relevant process steps and automatically adapts to all new regulations in the relevant sectors. On the path to this objective, a first step is to get the companies to provide a process-oriented map of legal requirements. So which legal requirements are implicated for consumer goods manufacturers, mechanical engineering companies, automotive suppliers and medical device manufacturers, generally and individually? Which process step can fulfill the relevant requirements most efficiently and effectively?

The answer is Legal Quality Management

Upholding legal regulations for product safety will, for instance, have to be addressed already during the development phase. Questions involving complaints are primarily processed by the Sales department, but the Development department should actually be made aware of them as well. Under this methodology, the whole company will have to be realigned. By creating a hybrid between quality management and the legal elements, thus creating a Legal Quality Management system, we create a controlled process basis. Consequently, dealing with the new requirements of the Internet of Things, Industry 4.0 or big data is possible from the sound basis of a controlled structure. Otherwise, these elements will only add to the existing undiscovered hidden risks in companies. This battlefield is where Quality Management 4.0 should be deployed.

The Author

Philipp Reusch

Philipp Reusch is the founder of Reusch Legal Consultants, with offices in Saarbrücken and Berlin. After studying law and economics, his first role was in a law office geared towards medium-sized enterprises. Today, he focuses on the automotive, regulatory affairs and compliance sectors. Philipp Reusch is a lecturer in product liability and product safety with the RWTH Aachen University. He is the author of several legal textbooks and works as a highly demanded legal consultant for a number of quality-related trade magazines.

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