Inventory Control - only manufacture parts AFTER receipt of a purchase order

[Lassitude]

Original Question:

Right off, let me tell you that I am a neophyte in the QS world. I am trying to determine if there is any requirement in QS9000 that says that a manufacturer can only manufacture material or parts AFTER receipt of a purchase order from a customer. In other words, can a company, under QS9000, make product for stock?

This is a bone of contention between marketing/sales and manufacturing in a small company that I know.

My understanding is that QS is a system and each company can set up its own requirements as long as the management and documentation are in compliance with QS9000.

I look forward to your reply. Thanks in advance for your help.

I know of no restriction from manufacturing a product and stocking it prior to receipt of a PO as long as you comply with QS9000 requirements which includes applicable portions of APQP and being able to PPAP the parts. Maybe you make fuses for many applications and Ford decides to buy some of a kind and amperage youy already make.
Remember that not every auto component is specific and new. Often they are stock items in production prior to an automotive company even starting APQP for a model year.

Comments from others???

 

[Mike525]

I agree with Lassitude. QS9000 does not dictate how we can run our business, it simply gives us guidelines to ensure we take into account customer satisfaction in the performance and manufacture of our product and / or service.

 

[Jada]

Now that I have looked up the word neophyte I'll try and give a possible answer.

The only reference that comes close to describing what you are indicating is under 4.15.6.2 where your production scheduling has to be order driven.

While I cannot really understand why you would want to make product just for stock, if you categorise the "excess" stock as buffer, this will probably get you through a QS audit, but I am curious why you would want to manufacture excess stock?

 

[Lwax]

Jada, you ask a good question. As you'd expect, we wouldn't want to make excess inventory if we didn't expect to receive orders for it. The issue revolves around manufacturing lead-times and the ability to maintain a minimal, but sufficient inventory to satisfy spot demand from existing and new customers. In my opinion, this is something that must be done or you risk losing sales to the competition. Of course this requires knowledge of the market and customer history. (No matter how closely you work with your customers, you don't always know what their volumes will be.)

Our manufacturing group insists that QS9000 specifically calls out that all manufacturing runs must be scheduled only after receipt of an order. I have been very skeptical of that claim, and apparently rightly so. Thanks for all your help.

Larry

 

[Howard Atkins]

I agree with Joseph.
The demand for order driven production is obviously based on the need to minimize inventory at all levels to save money. Inventory at the supplier eventually costs the customer, but leadtimes and geographics also play a part. Our customer service receive orders and forcastes and we play with this to produce most economically, we are order driven but some of the orders are internal.

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[jclucas]

My take is that you don't want to produce product without an order (this seems logical to me) .. but it doesn't have to be a customer PO that generates that build order. We produce a couple parts for stock and generate an internal order for the part. I think here is where the definitions your manufacturing folks are using is a little off. QS says nothing that it has to be a 'customer' PO. There are other kinds of orders for parts.

Joseph Lucas

 

[ALM]

First off, to MIKE525, I wholeheartedly disagree that QS9000 "does not" dictate how you should run your business. If ever there was a dictatorial standard, QS9000 is it. "Guidelines," IMO is an understatement of a description for QS9000!

On to an answer...

I would believe that you can do a build of product at any time and still be QS compliant, even if for a future order for a specific customer.

As long as you meet the customer requirements... spec, print, etc. and have data to support conformance, there should not be a problem.

The only snafu that I can think of is a change on the next P.O. Perhaps labeling requirements or parts per roll/bag/box... then you might have a conformance issue with the customer.

As for being out of line with QS, I don't think so.

ALM

 

[Marc]

Motorola makes diodes at one facility. The facility is QS9000 registered. They sell only 'catalogue' products. They must still follow APQP for the diodes they sell to GM, etc., even though GM calls and gives an order for a catalogue item. Only lines/processes making automotive product is within the scope of their registration. It all gets 'weird' with QS.