8 July, 2014 Christine Park, Quality Architech, Christine Park & Associates
|Ensuring supplier quality requires a baseline
understanding of four fundamental concepts.
"Everyone cares about quality. Just ask them. However, unless someone actively measures quality performance, you must question the commitment to improvement."
Supplier management is a process getting much more scrutiny from notified bodies and regulatory agencies these days. The process includes establishing supplier criteria, evaluating capabilities, selection and ongoing monitoring of suppliers. It starts early in the development activity of the product or service where the requirements and/or specifications are outlined, and progresses through the evaluation and selection through ongoing monitoring and support. The application of supplier management depends on the nature and risk associated with the product or services being purchased and/or received.
Ensuring supplier quality requires a baseline understanding and acceptance of four fundamental concepts:
1. Supplier assessment is a continuous process
It is too simplistic to this of supplier assessment solely in terms of "sizing up" a supplier prior to purchasing a product. True, that initial sourcing decision is perhaps the most critical in the supplier-customer relationship, but the ongoing fulfillment of the contract also warrants continuous assessment. This is done to ensure high-quality product throughout the life of the contract, to refine our supplier evaluation process, and to keep a "scorecard" for evaluation at the time the contract is due for renewal.
2. Organizations only choose to measure things which are really important to the business.
Everyone cares about quality. Just ask them. However, unless someone actively measures quality performance, you must question the commitment to improvement. You expect suppliers to measure their own performance, but that's not enough. You must define your own metrics and performance measures for the performance of your suppliers. This is the foundation of supplier assessment and management.
3. Informed quality decisions are less costly than those made in ignorance.
While every supplier is not going to be perfect, every sourcing decision can be effective. By going through the supplier assessment process up front, you can ascertain the supplier's strengths and capabilities before the business commitment is made. True, significant cost differences between suppliers might force a re-evaluation of the quality. Sole source suppliers pose different quality evaluation challenges. It is critical there are no surprises after you enter the agreement. There is no substitute for data.
4. Suppliers are assessed in different ways, depending on the potential impact on customer satisfaction and business profitability.
One size does not fit all when it comes to supplier assessment. The breadth and depth of the assessment may differ from product to product. The common thread through the process is the need to make a conscious decision related to the supplier's capabilities early enough to avert financial losses and possibly jeopardize customer satisfaction. The assessment of a non-critical part supplier can begin much later than the assessment of an OEM customer solution provider, because there is far less at stake with more options to recover, if necessary.
One way to manage this assessment is to perform an annual supplier review based on key risk criteria and supplier relationships. Documenting past performance and other quality system activities captures the objective evidence of these decisions and provides a foundation for supporting your decisions.
Many companies develop supply agreements with strategic and/or key suppliers. You should consider adding a master quality agreement to help manage these relationships. Documenting decisions for accountability and responsibility for key quality processes early in the relationship with the supplier can save big headaches.
Christine Park is a quality systems consultant with expertise in the implementation and remediation of sustainable and regulatory compliant quality systems. She has led the successful implementation of quality systems in large corporations, as well as small start-up companies. Her industry experience and background supports compliant yet practical, pragmatic quality systems. She can be contacted at 678-480-5411 and at email@example.com.