4.1 Organizational Context [ISO 45001 Procedure]

What Are Internal and External Issues?

Internal and external issues are circumstances, characteristics, and changes that can positively or negatively influence the OH&S Management System. It is imperative that these are identified so that there is a clear understanding and appreciation of the operating environment.

How to Document Internal & External Issues Relevant To Your Organization

Use a Context and interested Parties Matrix to document any external and internal issues relevant to your organization's operational purpose and strategic direction that may affect its ability to achieve the management system's intended result.

To assess whether your organization has a high-level, conceptual understanding of its internal and external issues that affect its ability to achieve the intended outcomes, you should describe the processes used to identify these issues and reference all objective evidence, including examples of these issues.

Examples of organizational issues might include:

• Health and safety conditions capable of affecting or being affected by the organization;
• External: cultural, social, political, regulatory, financial, economic, natural and competitive issues, whether international, national, regional or local;
• Internal: organization’s activities, products, services, strategic direction and capabilities (people, knowledge, processes, systems).

You will need to determine and understand the various health and safety conditions and internal and external issues typically experienced in your type of organization, which can have positive or negative impacts.

The standards do not specify that these internal and external issues, or their monitoring and review, be documented, so there might not be ‘lists of issues’ or records of reviews. However, information can be obtained via interviews with relevant Top Management regarding your organization’s context and strategic direction, the identified issues and conditions, and how these may affect the intended outcomes of the management system.

Collate evidence to provide assurance that your organization is regularly, or as necessary, reviewing and updating its external and internal issues. Although there is no requirement for documented information to define the context of the organization, your organization will find it helpful to retain the types of documented information listed below to help demonstrate compliance:

• Business plans and strategy reviews
• Competitor analysis
• Economic reports from business sectors or consultant’s reports
• SWOT analysis for internal issues
• PESTLE analysis for external issues
• List of external and internal OH&S issues and conditions
• OH&S action plans and objectives
• Annual reports
• Minutes of meetings (Management review and, e.g. design review minutes)
• Process maps, tables, spreadsheets, mind mapping diagrams

Reviewing your organization’s context could include interviews with senior management, questionnaires, surveys and research. Cross-functional input is essential for the specific expertise required to identify the full breadth of issues, such as finance, training, human resources, commercial, engineering and design, etc. Not only will this ensure a broader appreciation of the context but also wider engagement, particularly with those functions not previously involved with the OH&S Management System.

Using SWOT and PESTLE Analysis Templates, analyze internal and external issues. This provides clear evidence that a comprehensive process has been carried out to understand the context within which your organization operates.

This activity will also help determine the scope of the OH&S Management System as required under Clauses 4.3 and 9.3.

It is recommended that the information gathered during discussions at all levels of the organization to determine context be placed into a report. This provides a cohesive explanation and a good reference to support present and future business strategy.

Documenting Internal Issues

Using a SWOT Analysis Template will help you identify and analyze your organization’s strengths, weaknesses, opportunities and threats.

Below are typical examples; however, each issue will be focused on the individual organization:

Strengths

Our organization's strengths allow operations to be more efficient and effective than our competitors.

• What does our organization do well?
• What advantages does our business have over other internal sections or external organizations, including competitors?
• What makes our organization different from competitors?

Weaknesses

Weaknesses are areas that are recognized as needing improvement.

• What can be done better?
• What causes problems or complaints (information from root-cause analysis)?
• Which capabilities need modifying, strengthening or divesting for the future?

Opportunities

Opportunities are trends, circumstances, or business opportunities that may be taken advantage of.

• What are the changes in technology or markets?
• What local and global events may be useful?
• What are the changes in customer/societal values?

Threats

Threats can be external or internal and can adversely affect business or operations.

External threats could be economic, new legislation, or even a new competitor in the market.

Internal threats could be a skill or staff shortage within our organization.

• What obstacles are there for ongoing operation?
• Are there any potential competitors to the business?
• Who might be the new competition?
• Are there any potential changes to staffing, products, services, or technology that could threaten operation or business?

Documenting External Issues

A workshop approach often allows ideas to be shared and provides an effective and efficient way of achieving a valuable outcome. The workshop could simply be a discussion identifying the issues that can be mapped out using Political, Environmental, Social, Technological, Legal and Economic (PESTLE) analysis.

This method helps to structure the conversation and will also help to achieve buy-in to what is often seen as a peripheral or niche area.

PESTLE Analysis - Political

What is happening politically in the environment in which we operate?

• Trading policies
• Funding, grants and initiatives
• Home market lobbying/pressure groups
• International pressure groups
• Wars and conflict
• Government policies, terms and change
• Inter-country relationships and attitudes
• Political trends
• Internal political issues
• Shareholder needs and demands

PESTLE Analysis - Environmental

What is happening with respect to ecological and environmental issues?

• General market conditions that affect the business
• Market direction
• Environmental issues
• Environmental regulations
• Stakeholder/investor values
• Needs for the organization’s products and services in the market
• Customer market technology opportunities
• Competitors and differences between competitors
• Competitiveness of the organization and what affects its ability to compete
• Customer problems and complaints with current products and services

PESTLE Analysis - Social

What is occurring socially and culturally in the markets in which we operate?

• Current or emerging trends in lifestyle and their implications
• Demographic trends that may affect market size (growth rate, income, population shifts)
• Whether these trends represent an opportunity or a threat
• Changes in consumer behavior
• Increasing environmental awareness
• Urbanization
• Consumer demands; personalization and high-end experiences
• Public demand for transparency and participation in decision-making

PESTLE Analysis - Technological

What is happening technology-wise that can impact our actions?

• Maturation of existing technologies
• Technological developments or trends that affect or could affect the business
• New product development and potential markets: government, international, resource sector, etc.
• Productivity improvements through automation
• Telecommunication infrastructure
• Online connectivity and digital data

PESTLE Analysis - Legal

What is happening with changes to legislation?

• Possible changes in regulation/legislation
• Impacts of these changes on business
• Stability of government
• Outsourcing regulations
• Government bureaucracy – rules and regulations
• Legal constraints

PESTLE Analysis - Economy

What is happening within the economy?

• National and internal financial trends (trends in economic forces)
• Economic trends that may have an impact on business activity
• Emerging markets
• Inflation, employment levels, supply
• Energy available
• Global financial situation

Examples of Internal Issues

• Governance, organizational structure, roles and accountabilities
• Policies, objectives, and the strategies in place to achieve them
• Resources (including human), knowledge and competence
• OH&S culture within the organization and the relationship with the worker
• Process for the introduction of new products, materials, services, tools, software, premises and equipment
• Working conditions

Examples of External Issues

• Cultural, social, political, legal, financial, technological, economic and natural surroundings, including the environment in which the organization operates
• Who the competitors are and any contractors, subcontractors, suppliers, partners and providers
• National and international law
• Industry drivers and trends that have an influence on the organization
• The organization's products and services and their influence on occupational health and safety

Finally

Identify OH&S-related internal and external factors and conditions that could affect or be affected by your organisation’s activities. Identify any significant risks and opportunities.