Your Internal Audit Team: Internal or Hired External? Outsourcing Internal Audits

My Management needs to add value in the organization as a result of internal audits.
I do audits, management is happy about the way I organize things but they want value addition as a result.
Any opinion/ comments/ suggestions are highly appriciated.

thanks,

That's a difficult question to answer without knowing what you're doing at the moment.....

amanbhai said:

My Management needs to add value in the organization as a result of internal audits.
I do audits, management is happy about the way I organize things but they want value addition as a result.
Any opinion/ comments/ suggestions are highly appriciated.

thanks,

Click to expand...

The focus of internal audits must shift after a system begins to mature. In the internal auditor classes I teach, the focus is on "Improvement Auditing" not just internal audits. The ISO process approach supports that idea, and it brings some Lean Mfg. thinking into the audit process. It is a continual seeking of things that can be improved, as opposed to just verifying whether people are following the correct methods and compliance. Since I have taken this direction in my classes, the feedback from management has been significantly better, with excellent results in their audits.

I believe that the value comes not so much from the auditor as from the Audit Program Manager! Instead of doing a traditional job of scheduling audits based on a year's calendar and so on, (a 'push' system) more active input should be sought from management as to what are the business challenges they face.

Then, as Helmut suggests, the auditors (possibly not the people you have at the moment) would then go an evaluate the qms for more than simple compliance issues.....

I've recently written two articles on both scheduling and competencies

Wes, I agree with all that you said. In today's economy, smaller companies (say 30-50 and under) are struggling to meet the demands of larger customers and fill the need with external help. I am helping with a company of less than 10 people that are not certified but want to at least be ISO compliant to fill the needs of a larger company and grow their business. While they are very basic in their QMS, they are seeing pressure to upgrade it due to a closing of a competitor. These situations are cropping up all over the country and the only option is to rely on external help.

Cost of hiring External Audit Consultant for ISO Process Audit?

Hi Elsmar Cove Friends,

Question for one of you consultants. I am putting together a proposal for two lead assessors (internal) to go do an external vendor audit. I have the costs associated with airfare etc.. (Denver to NY) for these two auditors. What I have been unable to find is a ballpark number to use as a comparison of what it would cost to hire a consultant to do an ISO process audit in NY, NY (2 day audit, fairly small operation). This is in the area of clinical trails and drug dependencies.

Does anyone have a source for how much in general consultants would charge per day and per diem etc...?

Any help would be greatly appreciated,
Callie

Re: Cost of hiring External Audit Consultant for ISO Process Audit?

Calico said:

Hi Elsmar Cove Friends,

Question for one of you consultants. I am putting together a proposal for two lead assessors (internal) to go do an external vendor audit. I have the costs associated with airfare etc.. (Denver to NY) for these two auditors. What I have been unable to find is a ballpark number to use as a comparison of what it would cost to hire a consultant to do an ISO process audit in NY, NY (2 day audit, fairly small operation). This is in the area of clinical trails and drug dependencies.

Does anyone have a source for how much in general consultants would charge per day and per diem etc...?

Any help would be greatly appreciated,
Callie

Click to expand...

I think I understand you to mean you intend to send your own folks to do the job at their regular salary PLUS the expenses associated with the trip, but (if you can make an economic case) you would consider hiring two local professional auditors to act as your direct agents in auditing a supplier instead of using your own people. Essentially, you'd be replacing travel, lodging, and per diem with professional fee + per diem. Is this correct?

I'm sure quotes are all over the map, but many experts of my acquaintance charge about $1,000 USD per day plus out of pocket expenses. This assumes the expert can hit the ground running and does not have to be brought up to speed on the idiosyncrasies of the target auditee's industry.

Just to be clear - you are NOT soliciting formal quotes from auditors for your business at this time - just fishing for ballpark rates.

Obviously [to me], you still have to work out the exact expertise which would be comparable to your in-house staff to include in a formal request for proposal from auditors.

Re: Cost of hiring External Audit Consultant for ISO Process Audit?

Hi Wes,

Actually it's the opposite. I'm trying to build the case why it would be better to send the two internal assessors instead of hiring consultants. We are just building up our internal/external audit program and the two lead assessors have a couple of hundred audits (combined experience) under their belts but not very many vendor audits. I would see this as a great opportunity to start building this knowledge.

I understand there are differing opinions on using internal folks as opposed to hiring consultants and could really go either way.

You are correct that I'm just fishing and not looking soliciting actual quotes.

Your post was most helpful and I appreciate it very much!



Callie

Re: Cost of hiring External Audit Consultant for ISO Process Audit?

Calico said:

Hi Elsmar Cove Friends,

Question for one of you consultants. I am putting together a proposal for two lead assessors (internal) to go do an external vendor audit. I have the costs associated with airfare etc.. (Denver to NY) for these two auditors. What I have been unable to find is a ballpark number to use as a comparison of what it would cost to hire a consultant to do an ISO process audit in NY, NY (2 day audit, fairly small operation). This is in the area of clinical trails and drug dependencies.

Does anyone have a source for how much in general consultants would charge per day and per diem etc...?

Any help would be greatly appreciated,
Callie

Click to expand...

Consultant rates will vary a lot. $1000 to 2000 a day is common, and I'm sure there are some even higher and lower than that range. More to the point, if I were your supplier, I would be a little put out if you sent a couple internal staff emloyees, but told me you were going to charge consultant rates for reimbursement. You want to be sure that suppliers don't feel you are trying to take advantage of them.