Status of Quality Certification Implementation in Vietnam

administrative areas such as: Department of Standards, Metrology and Quality of Hanoi and Ho Chi Minh City, Dong Nai Department of Industry, Long An Department of Planning and Investment....

In terms of quality, we can see positive changes in many companies and organizations after applying this system. However, many places apply ISO only for the purpose of obtaining certification or due to export market requirements, without paying attention to maintaining and updating the system after certification. Rigid documents, processes, and procedures, far from reality, make the work a burden for the implementer.

* The situation of ISO 14000 application of Vietnamese enterprises

Up to now, although many experts have stated that Vietnam is an export-oriented country and must consider ISO 14000 as an important factor to maintain global competitiveness, the rate of application and acceptance of these standards is not as high as in other developed countries in the region. However, many enterprises tend to combine the QMS with the EMS, on the contrary, the formation and application of the EMS in companies that do not have a QMS is completely possible.

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In 1993, the State issued the Law on Environmental Protection, after which many sub-law documents guiding its implementation were issued.

Since 1998, the Directorate for Standards, Metrology and Quality has proposed and been accepted by the Ministry of Science, Technology and Environment for ISO standards on environmental management systems and environmental assessment (TCVN/ISO 14001, 14004, 1410, 14011, 14012, 14020) as national standards. The application of ISO 14000 standards for companies operating in Vietnam is not a mandatory requirement but on a voluntary basis. Currently, the government is very concerned about environmental issues and has established an Environmental Protection Support Fund, businesses are given priority to borrow capital with low interest rates to invest in environmental protection. This activity is especially encouraged and is becoming a movement in Ho Chi Minh City.

However, the response of businesses to the ISO standards

14000 in Vietnam compared to other developing countries in Asia is still low, even the enthusiasm is lower than in countries such as Taiwan, Korea, Japan, China and Malaysia. During this period, domestic companies still play a passive role in responding to external pressures rather than creating positive changes in their economic and environmental performance. There are several reasons: to apply the EMS, businesses have to spend a significant amount of money, awareness of the EMS and ISO 14000 is still very limited, lack of expertise and human resources, currently there is no pressure to certify the EMS from domestic consumers because they do not have full awareness in this field.

As of May 2002, only 32 enterprises in Vietnam have achieved ISO 14000 certification, most of which are joint ventures or 100% foreign-owned companies. Only 5 Vietnamese enterprises have achieved ISO 14000 certification, accounting for 15.6% of the total number of Vietnamese enterprises achieving ISO 14000.

* HACCP implementation status of Vietnamese enterprises

As introduced above, HACCP is a quality management system applied in the field of food processing and preservation, ensuring food hygiene and safety. HACCP standards are equivalent to ISO 9000 quality management system.

In Vietnam, HACCP is mainly applied in seafood processing enterprises for export and some pharmaceutical manufacturing enterprises. The application of HACCP in the seafood industry has quickly changed the situation of this industry: reaching an export turnover of nearly 2 billion USD in 2001, with a rapid growth rate. Such achievements are thanks to the leadership of the Ministry of Fisheries and the Ministry of Trade who have promptly directed enterprises to overcome barriers and increasingly strive to meet market demand. In 1994, the Center for Aquatic Product Hygiene and Quality Control (NAFIQUACEN) was established to control the quality of exported goods during the production process from the first stages and support enterprises in applying the quality management system according to GMP, SSOP, HACCP. On October 8, 1999, Vietnam was listed in group 1 of seafood exporting countries in

The EU has done a good job of monitoring food safety. So Vietnam has overcome some barriers and stood firm in the EU market - a large but very demanding market.

By the end of 2001, 78 enterprises had been granted HACCP certificates, some of which combined with GMP implementation to strive to improve production organization conditions, especially infrastructure and environment.

Due to pressure from the export market, some businesses have increased investment, upgraded factories and technological equipment, eliminated or limited negative impacts on the environment, and have been recognized by specialized agencies.

The application of HACCP, GMP... quality management systems in export enterprises has brought about clear results such as: Creating a basis for enterprises to control the production process; promptly preventing risks related to hygiene and food safety; increasing reliability of product quality; significantly reducing complaints. However, the number of enterprises achieving such progress is not much, most of the remaining enterprises are small and medium-sized, their products are mainly consumed domestically, have weak capacity, and are not proactive in controlling quality.

Difficulties in applying HACCP:

The concept of quality control in the KCS style is so ingrained in their subconscious that to switch to a new management method, there must be a transition period, combined with widespread propaganda of the benefits of applying the new system.

Businesses cannot find the funds to hire consultants to implement and upgrade infrastructure.

Legal documents and technical regulations are still inconsistent and incomplete, and lack standards on production conditions and inspection regulations for processing facilities, fishing vessels, fishing ports, and fish markets. There are no channels for collecting and distributing information among businesses.

* The application of the Social Management System according to SA 8000 standards by Vietnamese enterprises

The SA 8000 social management system is becoming increasingly necessary for export enterprises, and for that reason, Vietnamese authorities are currently conducting many information, training, and consulting activities for enterprises to apply this quality management system.

It can be said that the form of building, applying and certifying this system is quite new in Vietnam, but its nature is not. If a business complies well with the requirements of Vietnamese law, the application and certification of the above system will not have any significant obstacles. However, Vietnamese businesses need to take time to consider actual requirements, market and social pressures to make the right decision, avoiding following the trend.

On the business side, only a few (by the end of 2001, there were only 3 businesses) voluntarily applying the SA 8000 standard, mainly businesses in the leather, footwear, textile and garment industries, which attract a large number of workers. Furthermore, these are companies with the goal of exporting goods to the US, so they pay great attention to barriers, especially when the Vietnam - US Trade Agreement was signed.

In fact, the application of this standard will be more favorable for state-owned enterprises than for private companies. Firstly, because the human resource management mechanism of state agencies is unified, units must comply with a system of laws, which is the Vietnamese Labor Law, which is very close to the International Labor Law. Secondly, state agencies will receive great support and assistance from the Vietnamese government and managers, including workers, if they fight to protect the rights of workers. In addition, another reason why SA 8000 will certainly be applied by more and more units is because most of its provisions are consistent with the Vietnamese Labor Law. The issue now depends largely on the awareness and decision of the units when to apply and the pressure from the buyers.

Some obstacles in the process of applying SA 8000

Companies often fail to anticipate the difficulties they will encounter in

During the implementation process, one should either give up or do it perfunctorily, especially when the company is facing difficult circumstances.

Some companies cannot implement a work week of no more than 48 hours.

The cost of applying SA 8000 (assessment, implementation of changes) is still a difficult problem for many units. Limited financial and human resources have prevented many units from building a monitoring system according to the requirements of implementing SA 8000.

There is a growing divide between multinational companies and private companies over the ability to apply this standard.

Cultural differences between customers and suppliers.

3. Status of quality certification implementation in Vietnam

3.1. Type of certification

Mandatory: applies to cases related to safety, hygiene, health & environment.

Voluntary: includes many subjects with the purpose of advertising, enhancing reputation and competitiveness in the market.

3.2. Subject of certification

Management system certification: certification activities in accordance with quality management systems according to ISO 9000, HACCP, ISO 14000, SA 8000... standards and are also voluntary certification activities.

Product certification: includes both types: voluntary & mandatory (depending on state regulations).

The two types of certification objects above are two different forms. System certification is to create trust, while product certification is to confirm that the product meets a required quality level. Currently, nationwide, there are nearly 200 enterprises with about 20 types of products that have been certified and granted quality marks.

Product quality meets national standards TCVN, foreign and other international standards.

3.3. Certification consulting activities

As introduced above, QUACERT Certification Center under the General Department of Quality Measurement of Vietnam is an internationally recognized unit with sufficient capacity in assessment and certification work. QUACERT accounts for about 40% of the market share of certification work in Vietnam.

Besides QUACERT, there are about 20 foreign certification organizations operating in Vietnam, including organizations that have not registered to operate according to the law.

To date, about 85% of businesses are ISO 9000 certified in

our country is thanks to advice and guidance.

It is worth mentioning here that there are still many shortcomings surrounding the system certification: some businesses find it too expensive to get certified, others just need the certificate and ignore the system. There are businesses that lack seriousness in awareness and implementation process, they only need the certificate to be famous but do not really care about quality. In short, this activity needs to be corrected immediately, especially when it is still too new in our country.

In addition, the certification of the quality management system also has some weaknesses: There is a lack or no standards for many products currently in Vietnam; Low testing capacity, many products cannot be tested in Vietnam or can be tested but the results are not guaranteed; The State has not had many specific measures to encourage and motivate activities to assess conformity with standards. However, looking at it objectively, certification activities in Vietnam, under the impact of the revised Ordinance on Goods Quality and the awareness trend of both enterprises and certification organizations, are currently on the rise.

III/ ASSESSING THE CURRENT STATUS OF APPLYING INTERNATIONAL QUALITY MANAGEMENT SYSTEMS BY VIETNAMESE ENTERPRISES AND DRAWING LESSONS

1. Achievements

Product quality has changed significantly, even making great progress compared to the period of centralized planning in terms of variety, style, design, and packaging. Some products that were previously dominated by foreign goods have now been able to compete and stand firm in the market, and are favored by consumers. Imported goods have been improved and developed, contributing significantly to the increase in export turnover. The market is increasingly abundant and diverse, significantly meeting the diverse needs of consumers and producers.

Quality management has been developed strongly, richly, and diversely from low to high, from narrow to wide, from local to general, from asynchronous to systematic, creating the premise for higher and more comprehensive development in this century.

The rate of enterprises being granted quality management system certificates has increased rapidly, from 5 enterprises in 1996 to more than 800 enterprises in mid-2002.

The structure of certified enterprises has changed, from 100% joint ventures or 100% foreign capital in 1996-1998 to 60% and then 75% Vietnamese enterprises in September 2001.

Regarding the type of QMS, initially, businesses only applied ISO 9000, but now they have applied more diversely such as HACCP, ISO 14000, TQM, SA 8000... This proves that businesses are not only under pressure from the international market but also from the domestic consumption market. But no matter what, businesses are more aware of the benefits and inevitability of applying QMS.

The industries that apply QMSs most widely and effectively are:

textile, leather, footwear, and seafood industries because these products are mainly exported to foreign markets where fierce competition takes place. Achieving an export turnover of about 2 billion USD per enterprise in 2002 was a great effort by Vietnamese enterprises, the important driving force being the doubling of the number of enterprises applying HACCP. In addition, this application has also been extended to many other stages in the export production process.

The application of quality management systems of enterprises has gradually become routine with the awareness of always supplementing and systematizing documents as a basis for dissemination and uniform application throughout the enterprise, for all stages in the production chain. Strict document control helps enterprises to promptly analyze, evaluate results, find the cause of errors, propose timely solutions and handle them. In addition, thanks to the systematization of documents, enterprises have clearly understood the requirements of the product, focused resources to create quality products as well as calculated the effectiveness of applying quality management systems by reducing errors, reducing costs of time, staff, raw materials, increasing profits, increasing income. From there, the reputation of the enterprise is enhanced, officers and workers are excited, assured, and cooperate more closely with each other.

The following businesses are typical examples:

After a period of applying ISO 9002, Thanh Tri Export Garment Enterprise has reduced the defect rate to below 1%, arranged labor reasonably, so labor productivity increased by 11%, reputation was consolidated, there were more orders, workers' lives were guaranteed, and average income per capita increased.

Tan Chau Import-Export Company specializes in sewing and exporting jackets, T-shirts and sportswear. After 5 months of applying ISO 9002, the rate of defective products decreased from 30-40% to 5%. Labor productivity increased by 10-20%.

After 1 year of applying ISO 9000, Thang Loi Garment Company increased product consumption by 20% (thanks to better quality and lower prices).

After applying ISO 9000, FIDECO Company reduced the number of complaints by half.