Recording the results of Supplier Evaluation

[nicoleirvin]

Hi - I could use some help with a purchasing issue. During our transition ISO audit, we received a pretty hefty CAR for purchasing. Our company is a wholesale distributor of pipe, valves, fittings and pumps. Here is the CAR:

The following discrepancies were noted with the quality management system:

The standard requires that the organization shall evaluate and select suppliers. Criteria for evaluation and re-evaluation shall be established. Results of actions arising from reviews shall be recorded.

1) Supplier performance review methods are in place for resale suppliers to analyze performance however it was not clear what records are available for suppliers of packaging materials. In addition in isolated cases there was no evidence of supplier corrective actions.

2) Supplier evaluation for new suppliers and re-evaluation for existing suppliers need clarification as to what is the record beyond the CMEX data base. Supplier surveys are not available nor are they sent out to qualify new suppliers or to re-evaluate existing suppliers.

3) Purchase activities are defined for the resale products but needs clarification for the purchase of capital items, packaging materials and shop supplies.

It is not clear how the organization has reserved the right to verify product on supplier premises as no such right is reserved by terms and conditions nor with in any completed surveys.

So how do you evaluate and what are your recorded results for new suppliers?

Here are my thoughts - our company doesn't do supplier surveys - we simply don't see the value of them. Our associates in Sales have the capacity to add suppliers to fulfill customer's needs and as a result, suppliers are added on a daily basis. Once a supplier is selected, the associate fills out a supplier information form. The standard requires that we record the results of an evaluation. Could I argue that the result is the supplier information form. If the supplier is unable to fulfill our needs, we simply don't add them to our approved supplier list. For every supplier we add - we must fill out a supplier information form - is this kind of record sufficient?

Also, we are a bit stuck on the evaluation and re-evaluation of non-resale suppliers. While our associates are pretty good at recording problems with resale suppliers, they do not analyze the performance of non-resale suppliers. This is really left up to managers in that department. If they are unsatisified with the product, they change suppliers. That process is hardly ever documented and I would argue that it doesn't need to be. Are there any other distributors out there who record the evaluation and re-evaluation of non-resale suppliers? I can see how this would be more applicable to manufacturers or those in health care, but for distribution?

Thanks for your help. And sorry this is so long

Nicole

 

[The Taz!]

This is an interesting senario. . . Seeing you are ISO certified, and ISO2K is process oriented, I think the gist of the nonconformance is that the process for using suppliers is not well defined or takes into account any qualification of suppliers. Isn't a SALES ASSOCIATE bringing on a supplier, and filling out a SUPPLIER INFORMATION FORM like letting the fox watch the hen house?

A simple supplier survey is a good tool to at least believe (On paper anyway) what (or who) you are dealing with. Are your suppliers ISO certified?

Another point is by buying product from essentially any available supplier, you are adding variation into your saleable product mix. Are all shipments to a customer of a given product from the same supplier?? or can/do you mix product from multiple suppliers?

IMHO, the practices your company uses may satisfy shipments, but do they lead to customer satisfaction? I think the process you use may be looked at as "not too robust"

 

[isogeorge]

I would suggest that the vendor information file be used as vendor qualification. The ISO std does not require you to document the criteria involved in qualifing a vendor, but you must keep a record of the qualificiation. The ISO std also doesn't spell out the re-evaluation time/criteria, so a simple statement in your policy about "when deemed necessary by the Purchasing Manager " should suffice.

 

[Rob Nix]

You have opened an interesting can of annelids (worms). First of all, did the auditor tie his findings to any specific elements or clauses in the standard?

Regarding your 3 points:

1) Evaluating on-going performance is often done through the Corrective Actions system; if packaging suppliers have performance issues, do they not show up on a Corrective Action Report? It may also be done by a survey or rating system (but not necessarily).

2) How are suppliers selected? There should be SOME method of evaluating/selecting a new supplier*. I find it disturbing that Sales can select suppliers without working through the purchasing department.

3) It should be a rather simple thing to add to your purchasing procedures the processes used for capital items, packaging materials, and shop supplies.

Finally, regardless of the TYPE of supplier (e.g. resale, packaging, etc.) *there MUST be some type of evaluation for selecting/maintaining suppliers, e.g. ISO certification, recommendations by others, customer requirement, past history, surveys, etc.

I hope this helps, but perhaps I am missing something.

 

[Claes Gefvenberg]

I agree with what Taz is saying, and would like to add a little something...

A simple supplier survey is a good tool to at least believe (On paper anyway) what (or who) you are dealing with.

We do use a survey for re-evaluation of suppliers... Internally.... We do not pester our suppliers with it. Instead we get the internal customers to grade the suppliers on:

• Delivery precision
• Product quality
• Cooperation
• Complaints
• Price

It should be far more interesting to examine the internal customers view of a suppliers performance than to send a survey to the supplier, right?

/Claes

 

[nicoleirvin]

Thanks for your responses!!

Our Core vendors are selected and evaluated by management. But authorized associates (which means inside sales) select all other product vendors. Most of our suppliers are approved and brought into the system simply because they are the only ones who can supply the product we need within the time frame we need it.

Our auditor suggested supplier surveys, but I haven't seen the value of them yet. Management admits that the surveys wouldn't deter them from approving or disapproving a supplier. Since we don't do supplier surveys, I'm unsure on how many of them are ISO certified.

 

[nicoleirvin]

I really like the idea of surveying our internal customers on a supplier's performance!

I would appreciate more control over our selection of vendors, unfortunately, I'm fighting with management on this issue. Our purchasing manager just wanted to eliminate the part of the QSM that said we were going to evaluate our suppliers - that was his initial answer to the CAR.

It is very hard to get our managers to document anything. For our packaging suppliers - if they are not suppling us with quality material, our warehouse manager simply finds someone else. It seems a lot easier for him to just select a new vendor instead of issuing CAR on the existing one.

 

[Claes Gefvenberg]

It is very hard to get our managers to document anything. For our packaging suppliers - if they are not suppling us with quality material, our warehouse manager simply finds someone else. It seems a lot easier for him to just select a new vendor instead of issuing CAR on the existing one.

That may in itself indicate that it is a bit too easy. After all, most suppliers (all of them?) make mistakes now and then, and that kind of carry on will not exactly promote long term cooperation...

Or is it perhaps too hard to issue a CAR?

/Claes

 

[Rob Nix]

I agree with Claes. Something is amiss, and perhaps it is "management's" view of a QMS, e.g. "It is very hard to get our managers to document anything".

 

[nicoleirvin]

I agree that all suppliers make mistakes now and then, but when it comes to packaging, if we are getting a shoddy product, we can't afford to wait for them to improve through a CAR process. If our boxes are falling apart during shipment, then we simply have to find new stronger boxes - immediately.

But I think you guys are right - the managers are trying to just look for an easy way out - and this goes back to how they view the QMS. Fortunately the president has a different view, so if I need to enforce a change (or mere compliance) within the QMS, then I can try to get him on my side. Ridiculous that we can't all work together on this. But I suppose I'm not the only one with this problem

Thanks for all of your input!!