1. PURPOSE / SCOPE

burpfancyElectronics - Devices

Nov 8, 2013 (3 years and 9 months ago)

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:Work
Instruction



WI# 7410
-
000
-
002
-
0 COR

Description:

Supplier Performance


Page
1

of
4

Date Issued:

08
-
29
-
01

Revision Date
:

10
-
18
-
10

Updated By:

Mike Shipley

Approved By:

Tom Wright



1.

PURPOSE / SCOPE

This work instruction details the method used to monitor the performance of suppliers. Areas monitored include
quality, delivery, lead
-
time, and cost reductions. The primary responsibility for this work instruction is the Purchasing
functio
n. Secondary responsibilities as defined in attached flow chart.


2.

DEFINITIONS

Supplier scorecard


Information submitted to suppliers every four weeks detailing quality, delivery, lead time, and
cost reductions performance against pre
-
established goals


3.

FO
RMS

The scorecard is contained within the MacPac mainframe computer system


4.

INPUTS

4.1

Supplier quality level history

4.2

Supplier delivery history

4.3

Supplier lead
-
time (weighted average)

4.4

Supplier cost reductions (relative to current standards)



5.

PRO
CEDURE (Also see flow chart below)

5.1

Scorecard Criteria

Scorecard Total = 100 points Maximum


The Scorecard monitors multiple areas of Quality:

Period Level

and

Trend
-

Combined they
equal 25 of total Scorecard points available


Quality Level 20 points maxim
um

Quality Levels (3
-
Period DPPM) will be rated using the following criteria

< 501


Excellent

20

501
-
2500

Acceptable

15

2501
-

7500

Conditional

7

>7500


Unacceptable

0


Quality Trend 5 points maximum

Positive trend when comparing 6 period average
to 13 period average

Positive trend = 5 points,

Negative trend = 0 points


Calculations referenced above are made using the following common DPPM quality performance rating formula:



Number of Defects Delivered

x 1,000,000 = DPM


Number of Parts D
elivered




On Time Delivery 25 points maximum

Delivery will be rated on the following % on time based on an allowed 2 days early, 0 days late

98
-

100 %

Excellent

25

92
-

97%

Acceptable

18

83
-

91%

Conditional

10

<83%


Unacceptable

0


Lead Time Days

20 points maximum

Lead
-
time is measured based on a weighted average of the transactional and full part lead times in days


Transactional Lead
-
time

0


5


Excellent

14

6


15


Acceptable

9

16


30


Conditional

5


>30


Unacceptable

0


:Work
Instruction



WI# 7410
-
000
-
002
-
0 COR

Description:

Supplier Performance


Page
2

of
4

Date Issued:

08
-
29
-
01

Revision Date
:

10
-
18
-
10

Updated By:

Mike Shipley

Approved By:

Tom Wright



Full Lead
-
time

0


10


Excellent

6

11


30


Acceptable

4

31


60


Conditional

2


>60


Unacceptable

0


Price Variance (Current Period) 8 points maximum

Cost improvements will be rated on the following basis

>4.9%


Excellent

8

2.0


4.9%

Acceptable

6

0.0


1.9%

Conditional

4

<

0%


Unacceptable

0


Price Variance (6 Period Weighted Avg.) 17 points maximum

Cost improvement ideas will be rated on the following scale based on potential savings

>4.9%


Excellent

17

2.0


4.9%

Acceptable

13

0.0


1.9%

Conditional

7

< 0%


Unacceptable

0


5.2

Setting up Suppliers to automatically receive the Scorecard every period

5.2.1

The Supplier’s email or fax number is loaded into the Order Processing menu in Mac Pac (58. Customer
Fax# for Doc. Update).

5.3

Viewing an individual supplier’s scorecard

5.3.1

Current supp
lier scorecards can be accessed in MacPac using the Purchase Order menu item #72
(Supplier Scorecards) and typing in the supplier number (see Example below).





















5.4

Reviewing past period scorecard data for all suppliers

5.4.1

Run the query “SCORECA
RD” on the Allenton file server at the beginning of the following period.

5.4.2

Upload to Excel for review and consolidation

5.5

There will be a periodic review with supply chain leads and the NPI purchasing groups regarding supplier scores
and necessary actions. S
uppliers consistently scoring in the Unacceptable range will be targeted for corrective
action and possible replacement (removal from the Approved Vendor List). Suppliers with Excellent scores will be
given first opportunities to quote new business.

5.6

An an
nual business review will also take place with strategic suppliers selected by the supply chain group where
performance to goals will be discussed and targets for the new year will be communicated.



:Work
Instruction



WI# 7410
-
000
-
002
-
0 COR

Description:

Supplier Performance


Page
3

of
4

Date Issued:

08
-
29
-
01

Revision Date
:

10
-
18
-
10

Updated By:

Mike Shipley

Approved By:

Tom Wright





Acceptable?
Annual
Performance
Review.
Request
Corrective
Action.
Review
with
Supplier.
Monitor
performance.
Supplier
recognition.
Compare to other Suppliers of
same commodity
No
Yes
Review alternate
sources
Purchasing
Supplier
Performance
Record
Retention
Purchasing
Receiving
Inspection
Quality
Purchasing
Purchasing
Purchasing
Purchasing/Quality
Purchasing
Purchasing
-Discrepancy History - DPPM calc
-Delivery Performance - OTD%
-Lead Time
-Price/Cost Reduction

:Work
Instruction



WI# 7410
-
000
-
002
-
0 COR

Description:

Supplier Performance


Page
4

of
4

Date Issued:

08
-
29
-
01

Revision Date
:

10
-
18
-
10

Updated By:

Mike Shipley

Approved By:

Tom Wright




6.

OUTPUTS / RECORDS

6.1 Sup
plier scorecard in the MacPac mainframe computer system (see example on page 2)


6.2 Meeting notes will be stored on
Titan/Operations/Supply Chain/Private in a folder


6.3 Supplier scorecard sent to suppliers (see example below)