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5 minutes on…

Taking Quality Outside your Four Walls with Supplier Quality Management

Tim Lozier, EtQ, Inc.

The Need for Supplier Quality Management

• Complexity of Business increases complexity of the Supply Chain

• Supplier Adverse Events affect the Brand!• What are the top challenges in Supply Chain Quality?

1. Real-Time Participation in your Quality Process• Achieved through Supplier workflows• Limited access to Suppliers to your Quality

Management processes• Reduce errors, save time to completion• Suppliers are linked into your Quality System

2. Quality at the Receiving and Inspection Level• Identify Suppliers and Materials• Set Acceptable Quality Levels• Connect Inspection directly to Quality

– Failed inspections are immediately flagged– Nonconformance/Deviation process immediately takes over

• Link inspection data back to the Supplier– Affects the Supplier rating– Suppliers are immediately

notified of failed inspections

3. Supplier Rating Management

• Suppliers are rated on two elements– Quantitative: PPM, Quality of goods, etc.– Qualitative: Timeliness, reputation, history, etc.

• Scorecards are critical to maintaining quality– Rate Suppliers – better suppliers get the better contracts– Link Quality events – nonconformances, defects, Corrective

Actions – to the Supplier scorecard

• Quality Management and Compliance should factor into scorecarding

4. Build Risk into Supplier Rating

• Risk Management and Risk Assessment provide systematic method for making decisions

• Build levels of risk into Supplier relationship• Scorecards will dictate the level of Risk of the Supplier• Systematically filter out high-risk suppliers

5. Regularly Audit and Maintain the Relationship• Auditing of Suppliers

– Determine health of their QMS– Assess the viability of the partnership

• Automate the Audit process– Technology to conduct scheduled audits– Supplier Self-Audit – submit compliance information electronically on

a scheduled basis

Audit FindingsCompliance CertificationsSupplier Quality SystemSupplier Quality AgrmntsOnsite Inspections

Supplier Quality Management

• Provides greater visibility into supplier Quality

• Creates a real-time interaction between Suppliers and Brand owners

• Adds Compliance to Scorecarding

• Regularly Audit and assess Suppliers

For more than 5 minutes…

EtQ’s Blog on Supplier Managementblog.etq.com

Webcasts on EtQ’s Supplier Management Systemwww.etq.com/webinars

www.etq.cominfo@etq.com516.293.0946