What happens if we evaluate supplier as not approved and there are no anothers?

[Qualqueen]

Re: what happen if we evaluate supplier as not approved but there no another one ?

and is third party certification is a base for evaluation a supplier and be the only one basis?

A third party cert ( ISO 9001:2008 ; ISO 17025 )is definately a good beginning. Acceptable consecutive shipments is something that works for our own company. May not work for yours. These are just examples, not engraved in stone.

 

[QCNat]

"It seems to work and this is a small percentage of overall vendors anyway. Remember, the system has to allow for those 1% of exceptions and give a way to deal with them."

I have had complaints from purchasing that our vendor approval process is preventing us from getting a sale because it is time consuming and as a distributor we have to procure parts quickly sometimes. We are certified AS9120:2009 & ISO2001:2008

My issue as a quality manager is that this is more then 1% of our business. One time buys or a supplier being the sole supplier are about 50% if not more of our business. Vendors are being added daily and in order to have some risk management I implemented a process to show we do due diligence to assess the risk and assure that we are procuring legitimate parts.

I have put in the procedure to allow for customer approval or if the vendor will not respond to our quality questionnaire that the parts will have to be tested prior to sending to the customer.

I have been asked if we could just skip doing the vendor survey and send the vendor a purchase order along with the vendor survey and our terms and tell them if they do not complete the survey and sign the terms that we will not receive the parts, but what if based on their answers we wouldn't have approved them, and/or wouldn't that technically be purchasing from vendors that are not approved?? Since one time buys are at least half, or the majority how can we determine risk without a survey, quality references, or researching of any kind.

I am looking for a way to simplify the process and make the management/purchasing department happy while still complying with the guidelines in the standard and doing our due diligence when it comes to managing risk.

Any suggestions would be gladly appreciated.

 

[John Broomfield]

I have had complaints from purchasing that our vendor approval process is preventing us from getting a sale because it is time consuming and as a distributor we have to procure parts quickly sometimes. We are certified AS9120:2009 & ISO2001:2008

My issue as a quality manager is that this is more then 1% of our business. One time buys or a supplier being the sole supplier are about 50% if not more of our business. Vendors are being added daily and in order to have some risk management I implemented a process to show we do due diligence to assess the risk and assure that we are procuring legitimate parts.

I have put in the procedure to allow for customer approval or if the vendor will not respond to our quality questionnaire that the parts will have to be tested prior to sending to the customer.

I have been asked if we could just skip doing the vendor survey and send the vendor a purchase order along with the vendor survey and our terms and tell them if they do not complete the survey and sign the terms that we will not receive the parts, but what if based on their answers we wouldn't have approved them, and/or wouldn't that technically be purchasing from vendors that are not approved?? Since one time buys are at least half, or the majority how can we determine risk without a survey, quality references, or researching of any kind.

I am looking for a way to simplify the process and make the management/purchasing department happy while still complying with the guidelines in the standard and doing our due diligence when it comes to managing risk.

Any suggestions would be gladly appreciated.

QCNat,

You have many options open to you to maintain standards while speeding up purchasing but I'm not sure how many of these you have already taken:

1. Vary the selection criteria and assessment method according to the supplied products' impact on product quality
2. Work with Purchasing to measure and reduce the total acquisition costs instead of just the PO price
3. Devise and apply a two-stage approval process where the first stage is quick for the new supplier to achieve probationary status before the second stage kicks in for partner status

Of course you'll work with Purchasing so together you come up with mutually beneficial criteria and assessment process.

John

 

[John Broomfield]

QCNat,

You also may have the option to specify additional controls in the PO for suppliers until you have evidence that they fulfill your selection criteria.

John

 

[QCNat]

Thank you John for your quick response.

Vary the selection criteria and assessment method according to the supplied products' impact on product quality
Work with Purchasing to measure and reduce the total acquisition costs instead of just the PO price
Devise and apply a two-stage approval process where the first stage is quick for the new supplier to achieve probationary status before the second stage kicks in for partner status

Yes I currently have measures in place such as these.
Risk Categories A. Significant B. Medium C. Low

"A." Vendors are probationary if they meet 1 of the below criteria...
1.Website shows evidence of QMS and/or other quality certifications AND able to verify business is legit.
2. Verified Business 10+ years active with no bad reviews (Google, Better Business Bureau)
3. Satisfactory completion of vendor Questionnaire and no report of Suspect parts with ERAI that are unresolved.
4. If they are given a positive rating of 3.0 or higher across the board with Net Components and no reports of suspect counterfeit parts.
5. IC Source 1 year or more
6. Ebay 500+ with rating of 97% or higher
7. Reseller Ratings 500+ rating 9 or above
8. Customer Approval
9. Manufacturer Direct
10. Franchise

"B." Vendors Can be approved for One Time Buys


Where I run into issues are when purchasing feels:
They are the sole supplier of the part and there are time constraints
1. no time to assess- end of day/after hours- feel it is time consuming to look into the criteria for probationary approval.
2. vendors that do not meet the criteria
3. will not respond
4. They have been reported and purchasing wants to make an exception

Issues like this I feel the parts should go to testing or we should get approval from the customer to authorize.

But they are saying where in the standard is this required.

I was asked - Why cant we force the vendor to complete our paperwork and issue a PO at the same time. Telling them we must receive the completed paperwork back or we will refuse the parts. Basically issuing a trial purchase order.

I have a cpl issues with this

1. A vendor is marked approved or not approved in our database. The system will only let you issue POs to vendors that are "approved".
So in this case wouldn't it be the same as approving the vendor using no selection criteria, and since this sounds like a much faster and easier process what is to prevent purchasing from getting out of control and doing this for all vendors they want to approve instead of using the criteria.
2.What if when the vendor completes our survey it is not done satisfactorily but they already shipped the parts.

I don't want to prevent sales but I want to ensure quality. Finding a happy medium is a challenge.

 

[John Broomfield]

QCNat,

What stops you doing this:

"You also may have the option to specify additional controls in the PO for suppliers until you have evidence that they fulfill your selection criteria."

Your dbase rules are too absolute when it should be serving the process. Having a two stage approval is very useful.

Is Purchasing being put under time pressure by the Requisitioners not planning their purchasing? If so, you need to find out why the management system is not helping them to get it right.

I would not involve my customers in this unless they'd like to nominate suppliers they trust.

John

 

[Chennaiite]

I tend to think questionnaire mechanism may not work for one-time buys. No surprise to me that sometimes suppliers don't respond to it. However, before jumping the gun I am interested to know what sort of parts are these one-time buys.

For monopolies, I don't think frankly there is any option other than to work with the Supplier and build mutual trust. What if your evaluation system rejects a monopoly supplier? You can perhaps plan a conditional acceptance.

I would ask how much do you think your current system helps in your pursuit towards managing risks in bought out items.

 

[somashekar]

Where I run into issues are when purchasing feels:
They are the sole supplier of the part and there are time constraints

You evaluate supplier to meet your organization requirement, which in simple terms is to be in business.
All sole suppliers stand evaluated and selected, otherwise while you are meeting your defined selection criteria., your business will stop and sink and may not quickly recover. This is not the purpose of the QMS or the supplier evaluation selection.
Here is a scope to work with such suppliers towards improvement while keeping supply and business going about with all necessary controls to avoid defects and associated costs. This is also a situation to establish quality objectives in purchasing to move from critical sole supplier situation to dual / multiple sources.

 

[QCNat]

QCNat,

What stops you doing this:

"You also may have the option to specify additional controls in the PO for suppliers until you have evidence that they fulfill your selection criteria."

Your dbase rules are too absolute when it should be serving the process. Having a two stage approval is very useful.

John

Thank you for your input.

I will add something on the PO that addresses additional controls..
Something like

Vendors that are not ISO certified will be added as "PROBATIONARY" on our AVL, (Approved Vendor List).

In order to establish "APPROVED" status requirements include:
1. A satisfactory performance evaluation.
2. A signed copy of our Supplier Profile & Purchase Order Terms & Conditions on file.

I wish our database rules were a little more flexible but our software currently does not have the flexibility to add parameters for probationary vendors. However, we are able to add a field for status.

 

[QCNat]

Here is a scope to work with such suppliers towards improvement while keeping supply and business going about with all necessary controls to avoid defects and associated costs. This is also a situation to establish quality objectives in purchasing to move from critical sole supplier situation to dual / multiple sources.

Did you mean to include an attachment?

Based on the feedback that I am receiving it seems to me that maybe I am not being flexible enough in allowing vendors probationary status especially when it comes to sole suppliers. I will keep that in mind when meeting with purchasing, revising the SOP, and work instructions.

Being a distributor and specializing in hard to find or obsolete parts,(electronic components and aerospace hardware), sole suppliers are common. We shop the open market and so we take on a lot of risk when choosing a vendor without doing a little research, as counterfeit issues have been on the rise and are a huge concern.