Customers as Suppliers - Chrysler Supplies Defective Product to us!

[Marc]

From: ISO Standards Discussion
Date: Mon, 19 Jun 2000 11:39:47 -0500
Subject: Re: Customers as Suppliers /Staples/Naish

<< From: Staples: Has anyone had any experience with customers as suppliers. Chrysler stamps a part which is shipped to my company, welded into our assembly and then sent to a Chrysler assembly plant. I have been accumulating defects from the Chrysler stamper and when pushed, they will give an RMA number for disposition, but I have never yet seen a corrective action report or containment activities. Does anyone have any suggestions? >>

Patricia,

As one auditor recently asked one of my clients: Why don't you stop using them? Just a little humor here folks!! It is not likely that you can do that.

Have you thought about not paying your bills until you get the corrective action? Don't know that it will work. But one of my clients years ago tried it with their customer who in turn didn't pay their bill so it was a tit for tat process that still provided no response.

Years ago when I was at Intel we were in a sort of similar situation. We had a customer who required us to use their bare board supplier. We had continual quality problems with them. What we did was call a meeting including the management, engineering, and quality staff (at least one from each discipline from each company). We sat and discussed the problems, the causes, and agreed on a plan to correct the problems. In our case our customer did not have the capability to correctly generate the film need to ensure proper layer registration and hole alignment. So we agreed to do the artwork at our customer's expense and send it to the supplier. Many but not all the problems went away in this cooperative venture. Perhaps getting a team with at least quality and engineering and production management together from the three facilities even if 2 are the customer's with a brainstorming session may help.

Phyllis Naish

[Marc]

From: ISO Standards Discussion
Date: Tue, 20 Jun 2000 09:23:24 -0500
Subject: Re: Customers as Suppliers /Staples/Kiely

From: GKiely

Patricia,

My company laminates material(s) that are used in the production of self-adhesive US postage stamps. Although our customer (a printer/converter) is actually another sub-contractor of the USPS, we still consider the USPS as a customer (and they consider my company as a direct supplier). The Postal Service provides all suppliers with equipment to test and measure the phosphor level of the stamp face paper. This equipment is considered 'customer-supplied product' by the ISO 9001 Quality Standard. As a supplier we have put in place several documented (controlled) procedures to protect this 'product'. These documents include: Operational procedures, calibration procedures, and return procedures. These procedures clearly states "ownership" as well as the requirements on how we as a 'supplier' will protect the device(s) while they are under our control.

Gerry Kiely

We have this problem all the time. In fact our two worst suppliers are our two best customers (GM and Ford). More than 92% of our late deliveries of finished product to our customer are because we didn't have the customer supplied component to complete the assembly. On one job last year we were scheduled to deliver finished product in May. We finished our work in April. We were not able to deliver the finished product until after we received the cusomer supplied component in October. This is an extreme case but there have been a number of times when the customer supplied product has been a day or two to more than a week late. Since we are required to use their components this is something we have just learned to live with as we cannot directly control the situation.

Best Regards,

Jim

Question: Can you argue that if your customer is your supplier then what you have is really "4.7 Control of customer-supplied product".

If I read it right, you're required to verify, store and maintain this, and report and record any that are lost, damaged or is otherwise unsuitable for use. This puts the onus on the customer to get the delivery right, correct?

AJP

AJ,

Absolutely the onus is one them. My real point is that it wreaks havoc on our scheduling when you set up a production line for a particular job based on the promised delivery of a customer supplied item only to have it not show up. If this performance was from one of our suppliers they would have been off the approved list long ago. But as I said before it is not like we have a choice to go some place else.

Jim