Many automotive customers suggest that their suppliers start on the path to IATF 16949 certification. For small and medium-sized companies, however, obtaining certification may not be an easy path. Let's see why.

Costs and benefits

As with any business decision, the return on investment must justify the expense. Often the entrepreneur does not have the tools or even the time to verify the exact cost/benefit ratio of certification. There are, however, academic studies that have examined the value of companies before and after certification on a large scale and with objective and measurable indicators, applying appropriate statistical techniques, have established that the value is definitely higher for certified companies, in particular with regard to:

• Higher sales and growth rates after certification
• Earnings are higher than in non-certified companies
• More advantages for smaller companies than for larger ones
• Low accident and fatality rates compared to non-certified companies

How to obtain certification

As far as 'how' to obtain certification is concerned, there are mainly three possible ways:

1. Implement the whole system with internal resources only, without the use of consultants. In this way, the company is able to set up a simple system, but one that is very close to its own reality. The advantages are the reduced costs and the simplicity of the system. The disadvantages are generally the lengthening of time, a system that is not always appreciated by the customer (because basically one continues to do as one has always done, without seeking true continuous improvement from a customer perspective).
2. Use external documentation and training courses (like ours) and complete the work with your own resources. In essence: do it yourself, but with outside help. In this way costs increase slightly, but time is shortened drastically. In addition, you do not have to dedicate an internal person to the work of drafting system documentation, with a clear reduction in lost time and the acquisition of an internal resource that can do something else.
3. Hiring an external consultant to implement the entire certification process. The costs are certainly higher because the consultant can cost between EUR 5,000 and EUR 50,000. It must be verified that the consultant is actually qualified and experienced in the automotive sector, otherwise the time to transfer knowledge to the consultant could increase considerably and the time could lengthen, as well as having a system that is not so efficient. In any case, if you have money to invest in the certification project, this is definitely the best solution.

Conclusions

The entrepreneur is the only one who can know what is the best solution for his company at any given time, based on the customer's requirements, the context in which the company operates and other considerations that cannot be specified here in their entirety.

Certainly, our organisation can offer many solutions, from the simplest to the most complex, because in over twenty years of experience where we have held all roles as consultants, auditors of certification bodies, lecturers, quality managers, we have gained the expertise and skills to meet any customer's needs and help them achieve their goals, whether they are a micro or a very large company.

IATF 16949 certification is an engine for growth. Because if it opens the door to a broader spectrum of business relationships (along the production and distribution chain), it can open up new opportunities in markets that might not otherwise be accessible.

IATF 16949 certification helps to keep business going for longer. Car Makers such as the Volkswagen Group, FCA, Peugeot, Renault, and their direct suppliers (Tier 1) generally choose certified companies to have greater assurance of business continuity. Companies that apply for IATF 16949 certification are also generally willing to invest more and do more to maintain the relationship with their suppliers. Controlling the production process is also one of the biggest costs for Car Makers, so once a supplier has been chosen, it is necessary to change as little as possible in the control conditions of the production process. In the end, IATF certification increases customer loyalty and reduces production costs. Unplanned or unwanted product deviations cost everyone time and money.

The bottom line, from the customer's point of view, is that the higher the level of quality that can be consistently produced, the more they repeat their purchases. People (or companies) do not change their purchasing habits without motivation.