Global companies are heading toward a paradigm shift beyond pure compliance, believes Harald Stubert, head of operational assessment and certification at Ericsson.
“You should be a little bit proud.” is the first thing Harald Stubert says to DNV Forum as he provides a warm welcome at Ericsson’s global headquarters in Stockholm, Sweden. “No other certification companies are allowed here.” Qualifying his statement he adds that while PricewaterhouseCoopers is the financial auditor, on the operational side DNV is alone at Ericsson. Mr Stubert then launches into an enthusiastic description of the Ericsson Global Management System (EGMS) – a system used in all countries where Ericsson does business and certified by DNV globally. The EGMS is applied in all Ericsson units for the purposes of describing and managing their way of working. It is a template for a ‘one company’ view, and it is consistently applied in every Ericsson operation, providing the framework for achieving operational excellence.
Delivering to the customer
“Most companies go local and get local certification,” he explains, “but that’s not meaningful to us. That would be very scattered. We want to follow the processes from the top to the customer. In a company you have a lot of processes, but there is only one process that is generating money. That is to deliver to the customer.”
Many of Ericsson’s customers are also global in scope, for example Vodafone and Deutsche Telekom. That means that they are Ericsson customers in many different countries, and they want the same delivery everywhere.
“Our way of ensuring this is by having a global management system – and by getting global assessment and certification by DNV,” says Mr Stubert. Few competitors can compete in as many countries as Ericsson can. For GSM – today the most common mobile system – Ericsson has approx 40% of the global market. There are 20 new mobile subscribers in the world per second. Says Mr Stubert, “40% of those will call on an Ericsson system.”
Unusual background
Mr Stubert does not have the technical background like most of those working for Ericsson. He comes from a career in consulting. He has degrees in psychology and teaching, which have been very useful he admits: “Information is very much administration. That is something that you have in the back of your mind. Ericsson is a very technical company. We have lots of people who know everything about technology, but when you come to implement eg, information security or corporate responsibility, you find very few people who understand how to do it. You find many who think that these subjects are very interesting and very important, but you have to have the tools to do it.”
This is where Mr Stubert and DNV come into the picture. He works closely with DNV’s London-based Jack Atamian who is the Key Customer Manager for Ericsson. He manages a team of some 25 people belonging to the global assessment resource pool for the Ericsson account.
Traditionally certification has been about to-the-letter compliance according to a standard. Ericsson, however, uses the relevant management system standards as a reference framework for good practice, and addresses their intentions within the context of the Ericsson business and culture to support the ‘way of working’. Where certification is demanded by the customers and considered appropriate, Ericsson demonstrates compliance within its global management system (EGMS).
Currently, Ericsson holds global group certificates to ISO 9001 (quality) and ISO 14001 (environment), as well as OHSAS 18001 (occupational health and safety) and ISO 27001 (information security) in specific areas. The EGMS is therefore used as the vehicle for addressing many requirements in the business, and using ISO 9001 as the basic framework, other relevant perspectives are managed within the same system. Effectiveness and compliance are systematically verified through assessments internally as well as by DNV.
The global management system is also useful when Ericsson acquires new companies, such as Marconi in 2005 and Tandberg Television in 2007. “Even if we buy relatively big companies, the total forms a minor part of global Ericsson. Most companies already have some sort of ISO certification. We immediately take this to DNV and include them in our setup. This means we have a much more dynamic system,” says Mr Stubert.
The full context
“Take for example Tandberg, which was already certified by another certification body prior to becoming part of Ericsson.
If we had let them keep their existing arrangement, that would have meant that another certification body would examine just Tandberg in isolation of the wider view. Perhaps they would come up with a non-conformity based on lack of understanding of the full context. Then that would have created big problems. For us, it’s important that they are integrated in an effective way in Ericsson.
We can ask DNV about that. They can see the whole pattern,” he says, continuing: One example of the usefulness of the EGMS is the way it deals with the American Sarbanes-Oxley Act (SOX) of 2002, a federal US law created in response to the many accounting scandals. Businesses quoted on US stock markets must comply with SOX. Instead of creating a separate SOX system Ericsson has included the requirements in the EGMS and applied it globally, in preparation for similar laws which are predicted to come in Europe and other countries.
Another example of the value of the system has been seen in relation to selection of suppliers. Earlier this year media uncovered unsatisfactory working conditions at suppliers to Telenor and Ericsson in Bangladesh. Ericsson has a systematic approach to supplier evaluation and selection within the EGMS. Therefore, suppliers in China, India and Brazil are focussed for greatest effort. It is interesting to note that an assessment of operations in Bangladesh had been planned some six months ahead in the annual global assessments of the EGMS, and scheduled for June with specific focus on the supplier interface issues.
Paradigm shift
Mr Stubert says that other global companies that have been doing things in the ‘old’ way are now seeing the value of Ericsson’s setup. “I know that other companies want it because they call me,” he says. “I’ve talked to several companies. It has to be described as a paradigm shift.”
Worth it
Ericsson pays for the total DNV effort of service delivery and the global management of it, with Jack Atamian doing a lot of work that other companies are doing internally. “We’re very satisfied with this arrangement. Is it worth it to invest in this? And it’s our conclusion that it is,” says Mr Stubert.
Text and Photo: Kaia Means
Date: 2008-12-22
