Zero Defect Zero Effect (ZED) Certification

Addressing the nation on India's 68th Independence Day, Hon'ble Prime Minister Shri Narendra Modi urged the industry, especially the Micro, Small and Medium Enterprises (MSMEs) of India, to manufacture goods in the country with "Zero Defects" so that our exported goods are never returned to us and to ensure that the goods have "Zero Effect" that they should not have a negative impact on the environment.

The Ministry of MSME has decided to implement the ZED Certification Scheme with the help of Quality Council of India (as NMIU) & other stakeholders for 22,222 micro, small and medium enterprises (MSMEs) with a total budget of Rs. 491 Crores (including Government of India contribution of Rs. 365 Crores) during the 12th Five Year Plan. The objectives of the scheme include inculcating Zero Defect & Zero Effect practices in manufacturing processes; ensure continuous improvement and supporting the Make in India initiative. The scheme is an extensive drive of the Government of India to enhance global competiveness of MSMEs by providing them financial support in assessment, rating & hand holding of its manufacturing processes on quality and environment aspects.

Thus, the ZED model aims to achieve high quality manufacturing that’s also green. While India putting efforts to become global manufacturing hub, the ZED model is necessary to take forward the efforts.

The major objectives of the ZED Scheme are:

• To create proper awareness in MSMEs about ZED manufacturing and motivate them for assessment of their enterprise for ZED rating.
• To drive manufacturing with adoption of Zero Defect production processes without impacting the environment (Zero Effect).
• To encourage MSMEs to constantly upgrade their quality standards in products and processes.
• To support “Make in India” campaign.

Assessment Criteria:

There are 50 parameters on which the MSMEs will be assessed and rated.

The MSME applicant is required to comply with identified 20 essential parameters & at least 10 other parameters (as per the MSMEs domain competency, i.e. sector of operation and type of industry). Hence, the MSMEs will be rated on a minimum of 30 parameters. MSMEs may seek ZED rating on more than 30 parameters as per the processes and systems available at the MSME.

Each parameter has 5 maturity levels. Each level corresponds to the existing state of systems and processes in the manufacturing unit that is being assessed. These levels range from struggler which is level 1, to beginner, organized and achiever that correspond to level 2, 3 & 4 respectively. The topmost level is world class at level 5. The Rating is based on a weighted average level. The company is encouraged, handheld and trained to achieve a higher level for each parameter and thus elevate itself in the maturity model.

The ratings provided in the maturity model are: If the MSME’s score is above 2.2 and up to 2.5, then the rating is Bronze If the MSME’s score is above 2.5 and up to 3.0, then the rating is Silver If the MSME’s score is above 3.0 and up to 3.5, then the rating is Gold If the MSME’s score is above 3.5 and up to 4.0, then the rating is Diamond If the MSME’s score is above 4.0 and up to 5.0, then the rating is Platinum In case an MSME scores 2.2 or lower, then no rating is provided.

ZED Maturity Assessment Model will evaluate an MSME’s manufacturing unit on process based enablers and performance based outcome parameters at the operational level.

e.g.

• Enabler for process quality
• Enablers for emission, effluent & waste disposal activities: Enablers for resource management
• Enabler on outsourced activity
• Enabler on innovation, creativity & safeguarding
• Outcomes for quality performance
• Outcomes for Process Performance
• Outcomes for environmental performance
• Outcome for overall company performance

ZED Process Flow :

Four Steps of ZED Rating Process

Free Online Registration :

The MSME has to first register online on www.zed.org.in. This simple step expresses an MSME’s intent to participate in the ZED scheme. The MSME must have a working email ID & an Indian number to start the registration process. A ZED ID will be allotted to you after completing the registration.

Online Self-Assessment:

The Online self-assessment process is a precursor to the desktop assessment and onsite assessment of the systems and processes of the applicant MSME’s manufacturing unit. A maximum of three attempts will be permissible per applicant.

This process has three key outcomes: First, it will make the applicant aware of the parameters and simultaneously assist the applicant in selection of the optional parameters that apply to its manufacturing unit. The desktop and site assessments will be based on these selected optional parameters, along with the 20 mandatory parameters. Second, the applicant will be made aware of the requirement of relevant evidences for desktop and site assessments stages. Third, it will broadly indicate the existing state of systems & processes of the applicant’s manufacturing unit on the ZED scale.

Desktop Assessment:

The Desktop Assessment process will evaluate the online self-assessment exercise undertaken by the applicant MSME. This process is in 3 stages: First, payment of relevant fee (Rs. 10,000/-) by the applicant MSME. Second, submission of relevant evidences as advised in the self-assessment stage. Third, evaluation (by the desktop assessor) of the self-assessment vis-à-vis evidences submitted.

QCI will monitor & assess the documents submitted by MSMEs in the online self-assessment exercise and provide detailed report and guidance wherever necessary to the MSME before the MSME goes for the ZED site-assessment and rating process.

Site Assessment:

The Site Assessment process is a comprehensive physical assessment & evaluation of the existing systems and processes of the applicant MSME. Site-assessment is conducted by third party accredited Credit Rating agencies, Certification Bodies and other agencies. TUV India Pvt. Ltd. is also appointed as ZED rating agency by Quality Council of India.

Typically, 2 assessors will participate in this process and assess/evaluate the existing systems and processes of the manufacturing unit on the parameters selected during the online self-assessment stage and collect additional relevant evidences as applicable. This assessment is done using the latest technology with hand-held tabs. The rating agency has to provide a system generated report for onsite assessment to QCI. Ownership of the assessment report will be maintained by the rating agency. Their assessment report will be evaluated by the NMIU which will result in a Certification as appropriate.

The rating provided will be valid for a period of 4 years. Surveillance audit will be carried out by QCI.

Typically an MSME can apply for re-certification after 6 months of initial certification. However, the subsidy on the cost of the re-certification component will be given to those MSMEs only which achieve a higher level in rating from the initial/previous rating. e.g. if the previous rating of an MSME unit was Bronze, then subsidy will be extended only if re-certification rating of that MSME unit is minimum Silver.

The ZED Model is applicable to all sectors of MSME’s but currently the ZED Model is launched only for Manufacturing Sector.

It is a voluntary scheme which will provide the MSMEs a roadmap to global competitiveness.

ZED is an integrated and holistic certification and hand holding scheme which aims to provide an opportunity to Micro, Small and Medium Enterprises to strive to continuously improve its processes thereby aiming to move up the ZED maturity assessment model (Bronze- Silver-Gold-Diamond-Platinum). It is a maturity assessment model and not a conformity assessment model.

Benefit to MSMEs:

• Easy access to Loans
• Credible & reliable vendor database
• Reducing negative effect on our environment
• Awards & Rewards
• Aligning with best practices
• Global Competitiveness
• Visibility & brand recognition

Recently first ZED Bulletin has been released by Quality Council of India. It is available on the below link.

youtu.be/hm0pkySSdP0