ISO 9002 Registration Implementation At Secunda Marine Services Limited
Ernie Buist, Acadia University
1 Introduction

In November 1997, Captain Harry R. Pitcher, Quality and Safety Manager for Secunda Marine Services Limited (Secunda), sat at his desk in the company’s Dartmouth, Nova Scotia head office. He was reviewing the Company’s policies and procedures, which had been painstakingly assembled and documented over the past 6 months, as part of the process to register to ISO 9002 quality management standards. In order to move on to a successful registration assessment, the Company had to move from the policy and procedure documentation stage to implementation. 

Implementation could be a challenge for Capt. Pitcher due to the character of the organisation that had developed as a result of its rapid growth and due to the culture that prevailed in the offshore part of the marine industry. Successful implementation was Capt. Pitcher’s responsibility and gaining acceptance of and adherence to the specified ISO 9000 policies, procedures and related work instructions could prove difficult. 

Capt. Pitcher wondered how he could best manage implementation. 

2 Company

The Company’s corporate offices are located in Dartmouth, Nova Scotia and it operates branch offices in Newfoundland and Barbados. 

Secunda commenced operations in the early 1980’s in Dartmouth, Nova Scotia, on the east coast of Canada. The company was formed in response to the major offshore oil exploration program underway at that time off the Canadian east coast. The Company started with one supply boat and now operates a diversified fleet of 17 vessels including anchor handling/tug supply, DP platform supply/dive support, anchor handling ocean-going salvage tugs, standby rescue, seismic research, cargo, cable lay and deck barges (see Exhibit 1 – Fleet List). 
The expertise of Secunda’s personnel spans most facets of the marine transport industry, including: 
· General cargo shipments (including containerisation) in conventional vessels 
· Specialised areas of dynamically positioned ships 
· Tug/barge combinations 
· Ocean towage 
· Marine salvage 
· Offshore oil exploration and development support 
The underlying philosophy has been to avoid categorisation that would restrict utilisation of its ships. The company attempted to innovate and be flexible. 

Secunda has been active in the North Sea for the past several years and it provides salvage capabilities in the Atlantic Basin with vessels situated at various U.S. and Canadian ports ready to respond to any emergency. Secunda has worked extensively in Latin America and in the Caribbean markets. They have a strong presence in the Gulf of Mexico, providing dive support and anchor handling services. Secunda also provides trans-ocean towage. In addition to the Gulf of Mexico, Secunda vessels currently operate in West Africa, the Middle East, the North Sea, Eastern Canada and the Eastern United States. 

3 Competitive Environment

Secunda competes in a worldwide market against well-entrenched, well-capitalised European and American competitors. Given the investment in equipment and in human resources required in this industry, efficient utilisation is a key factor in a firm’s ability to compete and to succeed. Due to this, competitors, including Secunda, aggressively compete for contracts anywhere in the world. Calls for bids are as aggressively responded to for contracts off the east coast of Canada as they are for contracts in the Gulf of Mexico or in the North Sea. A stable and dependable home market does not exist. 

The main customers in this industry are the major oil and gas exploration companies. All contracts are awarded on the basis of bids provided by the various supplier companies. The decision criteria used to discriminate among competing bids is listed below, in order of importance: 

#1. Safety 
#2. Quality 
#3. Delivery 
#4. Price 

It may seem surprising at first reading to see that price is so far down in the list of priorities. The fact is, however, that an accident can be catastrophic in the environment in which Secunda operates. The Exxon Valdez accident in Alaska is an excellent example of the potential scope of the consequences of an accident. Increasing sensitivity to environmental issues led to increasing financial liability and hence to a higher priority ranking for safety and quality in decision making. 

4 Secunda’s Decision to Seek ISO 9000 Registration

In mid-1996, the International Maritime Organisation (IMO), to which Canada is a signatory country publicised a draft of a Safety and Environmental (ISM) standards code that all companies operating offshore vessels in signatory countries would have to comply with, by July 2002. 

The code was established by the IMO, which is a specialised organisation within the United Nations that is responsible for improving maritime safety and preventing pollution from ships. The IMO is composed of 158 countries. When member countries become signatories of IMO conventions they are obligated to meet the enforcement deadlines for the related codes. To date, 137 countries are signatories, covering nearly 98% of the world’s shipping tonnage. 

In January 1997, Secunda’s president, Mr. Fred Smithers, mandated Captain Pitcher to establish a Quality and Safety Department for Secunda. The department’s primary responsibility was to achieve company and vessel certification under the ISM standards and ensure that certification would be maintained. The company had five years before compliance would be required after which, in July 2002, vessels not certified would not be permitted to operate in waters regulated by signatory countries, which included all areas in which Secunda operated. 

In May 1997, Capt. Pitcher attended an ISM/ISO seminar, to learn more about management of the ISM audit process. The major topics of the seminar were the government mandated Safety and Environmental Standards Code (ISM) and the related regulations. There was also a discussion of ISO 9000 standards during the seminar. It was during this part of the seminar that Captain Pitcher became aware of the significant overlap of the ISM and ISO 9000 code elements. 

The decision facing Secunda management then became whether they should certify to the ISO 9000 standards concurrent with obtaining the mandated ISM certification. The $70,000 incremental cost of ISO 9000 registration was relatively modest and Capt. Pitcher had determined that there was an 85% overlap between the elements of the two codes. (See Exhibit 2: ISO/ISM/QSM Cross Reference

After review, senior management felt that registration to ISO 9000 standards would result in significant competitive advantage. To derive the full benefit, however, the implementation process would have to be carefully managed. 

Many of the major contractors preferred or required ISO 9000 registration as a pre-requisite to being qualified to bid on projects and the number of such firms was increasing. If registered, Secunda would be, if not the first, certainly one of the first North American firms in the industry to be registered to ISO 9000 standards. In addition to regulatory and customer pressure, Secunda’s executive recognised that the rapid growth they had experienced required more sophisticated management policy, procedures and controls. The president of Secunda expanded Capt. Pitcher’s mandate to include registration to ISO 9000 quality management standards. (See the links to several standards organisations at the end of the case) 

Capt. Pitcher realised that implementation would have to be managed carefully if operational problems were to be avoided. The rigid procedures that would have to be imposed on shipboard operations could be especially troublesome. The officers on Secunda’s various vessels would likely view the imposition of policies, procedures and standardised work instructions as a significant increase in administrative requirement. Marine officers typically enjoyed significant autonomy. 

5 Secunda Vessel Masters

The masters of Secunda vessels enjoyed a high degree of authority and responsibility, consistent with the development of marine culture over the past 500 years. This may be best illustrated in the following excerpt from the Company’s Quality, Safety and Environmental Policy Manual, 

The Master of Secunda vessels have absolute command of his/her vessel. He/she has complete authority to take whatever steps he/she deems necessary to ensure the safety of the vessel and its crew.
This is particularly the case in respect to issues of safety and environmental protection. 

Vessel masters are well paid and in demand, worldwide. To rise to the position, masters have many years of experience, progressing through the ranks, usually on a number of different vessels. They must also successfully complete numerous operational and management levels of certification to achieve the Master Mariner Certificate of Competency. The increase in safety and environmental regulations over the past two decades has added significant responsibility to the position. 

6 Vessel Organisation

Following is a summary of vessel staffing that is generally consistent with Secunda’s larger vessels. 

A typical deep sea merchant ship has a captain, three deck officers (or mates), a chief engineer, three assistant engineers plus six or more non-officers (deck seamen, cooks, etc. 

Larger coastal vessels may have a captain, a mate or pilot, an engineer and seven or eight seamen. 

Deck officers or mates perform work for captains as well as supervise crew activities onboard ship. Mates supervise cargo loading and storage and ensure vessel maintenance is completed. When more than one mate is on a vessel, they are designated chief mate, first mate, second mate, etc. 

Engineers operate, maintain and repair propulsion engines, boilers, generators, pumps, etc. If there are several engineers, they are designed similarly to mates, chief engineer, first assistant engineer, etc. 

7 Human Resources

Secunda operates with a staff of approximately 450 employees. Shore based staff, fulfilling the traditional business discipline roles, total 38, including executive positions. Of these, about 50.0% have less than 5 years tenure with Secunda. 

There is a total of approximately 412 vessel staff, fluctuating around this number depending upon need. These employees can be deployed around the world for months at a time, often restricted to the vessel for a period of days. 

7.1 Mr. Fred Smithers, CEO

Fred Smithers, in his mid-50’s, spent much of his working life in various industries around the Atlantic region. Mr. Smithers was motivated to start Secunda when he saw an opportunity arise as a result of the offshore oil developments in the 1980’s. While he had no marine experience prior to starting Secunda, he has developed a worldwide reputation as a competent and progressive manager in the marine industry. 

Under Mr. Smither’s tenure, Secunda has operated with an open door policy. Employees have been encouraged to approach management with problems and ideas, reflecting the informality in the company’s organisational structure, which established when the company was young and growing. The result has been open communication and management autonomy. This was a dynamic that the Company did not want to lose. 

7.2 Capt. Harry Pitcher, Quality and Safety Manager

As Quality and Safety Manager for Secunda Marine, Capt. Pitcher is responsible for the formulation, implementation and monitoring of the company’s quality, safety and environmental initiatives. Capt. Pitcher directs the activities of the Secunda quality and safety department, which includes a co-ordinator and an internal auditor. 

Capt. Pitcher joined Secunda Marine as Operations Manager in 1991. He has over 25 years of hands on and managerial service in marine areas such as offshore support vessels, dynamic positioning dive support vessels, cargo and Ro-Ro (roll-on; roll-off) vessels, tugs and barges and in the fishing industry. 

After six years as Operations Manager, Capt. Pitcher was mandated to establish the Quality and Safety department, as Manager. 

Prior to joining Secunda, Capt. Pitcher held senior positions in operations management with several national and international companies, as well as serving as master on various types of ocean going vessels. 

Capt. Pitcher holds a Master Mariner Certificate of Competency and holds certification in several specialised marine management and operations areas. He has taken courses in or holds certificates in the areas of internal auditing for quality, safety and environmental management systems as well as holding a diploma for the ISM code. 

8 Closing

Capt. Pitcher’s challenge was to ensure that Secunda employees at all levels accepted and followed the policies, procedures and work instructions defined in the various manuals. Failure to implement would result in failure of Secunda to attain registration to ISO 9002 standards. At the same time, Capt. Pitcher recognised that he had to approach implementation carefully, especially when it involved vessel masters, in order to maintain the positive corporate culture that had developed within Secunda Marine. 

Standards Organisations 

International Marine Organisation
International Organisation for Standardisation
World Certification Services, Ltd.
Standards Council of Canada
Canadian Environmental Auditing Association (ISO 14000)
Information Technology Industry Council