ISO 9001 Compliance-7.4 Purchasing Developing a supply-chain that satisfies your customers

The Purchasing requirements in the ISO 9001 standard help to ensure that products and services you purchase from various suppliers fully meet your needs so that you can, in turn, satisfy your customers. The disruption and cost to your organization stemming from supplier problems can impact your customers and your own bottom-line. So, having processes in place that prevent problems and provide consistency within your supply chain is a key focus of your ISO quality management system (QMS).

CONTROLLING WHAT IS NOT UNDER YOUR DIRECT CONTROL

"It is surprising how many times a 'supplier problem' actually has its root cause in your own organization stemming from internal miscommunication, inaccurate information or other mishaps that lead to 'mistakes' made by a vendor."

While your suppliers' operations are not under your direct control, your purchasing power can give you significant influence over which suppliers you do business with and how they meet your needs. This influence starts with you having a clear understanding of what your needs are regarding purchased materials and services. These needs then must be translated into criteria for choosing suppliers and requirements for them to meet. Without this clarity, neither you nor your suppliers will know what is to be expected and will inevitably lead to problems down the road. It is surprising how many times a "supplier problem" actually has its root cause in your own organization stemming from internal miscommunication, inaccurate information or other mishaps that lead to "mistakes" made by a vendor.

The ISO 9001 requirements for Purchasing (section 7.4) itemize basic processes that will put you and your suppliers on the same page.

Your ISO QMS then begins with you firming up your own purchasing processes to improve the information suppliers will rely on to meet your requirements. Then, controls are put in place to monitor supplier performance and to take corrective action, if needed. By establishing strong internal procedures for purchasing, you'll more easily exert the influence needed to assure quality coming into the loading dock.

MAKING THE RIGHT CHOICE

The purchasing requirements begin with a recognition that your company is responsible to:

… ensure that purchased product conforms to specified requirements. (ref. 7.4.1)

To do this you'll establish controls for your suppliers and your purchased product that are appropriate based on how the supplied product might impact your products and/or services delivered to your customer. If a supplied part is critical, you'll exert more control than if a part is less important to the quality of your company's output.
This control begins with the selection of suppliers that you'll depend on to meet your own customers' requirements. You'll implement processes for initially qualifying suppliers based on appropriate criteria such as cost, quality and delivery requirements. The criteria you establish should make sense for your business.
Once qualified, suppliers must be reassessed to reconfirm their continuing ability to meet your requirements. This re-qualification will be based on data analysis relating to your suppliers' performance. Section 8.4 of the standard itemizes these requirements. Records for the selection, evaluation and re-evaluation of your suppliers must be maintained.

COMMUNICATION IS KEY

How you communicate with your suppliers has a direct impact on their ability to meet your requirements. Your documented purchasing requirements define the target they must hit when delivering their products or services. The accuracy, clarity and level of detail provided in your purchasing documents must be ensured though good internal administrative processes.

Your purchasing information should clearly specify what is required, including as appropriate:

a) requirements for approval of product, procedures, processes and equipment

b) requirements for qualification of personnel, and

c) quality management system requirements. (ref. 7.4.2)

On purchase orders or other documentation be sure that the details adequately describe the product or service you require including technical specifications, packaging and delivery requirements and special requirements for your supplier's internal processes. Again, depending upon the type of product or service purchased, the information will include more or less details. Your internal procedure should ensure that all purchasing information is reviewed before being sent to your supplier.

MAKING SURE IT'S RIGHT

The third purchasing process to address is how you verify that received material and services are what you ordered and that they fully meets your requirements. This verification may be through a simple confirmation when the product is received or may involve formal inspections or testing. If necessary, you may even want to verify the product before it is shipped, or allow your customer to do so, by visiting your supplier's facility for an inspection. If this is required, you'll need to specify this in your purchasing documentation when the order is placed or the contract is signed.

A STEP BY STEP APPROACH

As you prepare to implement an ISO 9001 compliant purchasing processes, you might want to follow these steps:

Step 1: Define Criteria for Suppliers

On what basis will you choose your suppliers? What minimum requirements must they meet?

Step 2: Evaluate Current Suppliers

Which of your current suppliers meet your minimum requirements? Which might need to improve to remain qualified or face being replaced?

Step 3: Establish Qualification Process for New Suppliers

How will you identify, evaluate and qualify new suppliers? How will these qualifications be recorded?

Step 4: Set up Supplier Performance Monitoring Process

What is the best way to track supplier performance? Who will review the data? When will action be taken?

Step 5: Review Purchasing Communication Process

How are your requirements documented for your suppliers? How do you ensure it is accurate, clear and detailed enough to communicate what is ordered?

Step 6: Review Purchased Product Verification Process

What procedures are needed to confirm that you receive what you ordered? When might a visit to a supplier's facility be needed to verify a shipment?

For many organizations, bringing your purchasing processes up to ISO 9001 standards is an investment of time and effort that must fit into an already busy schedule. But this effort will not only support your ISO initiative, it can also be off set by fewer interruptions and unnecessary costs resulting from poor supplier performance.