1 forming relationships for the future supplier rating program space & electronics trw working...

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Forming Relationships for the Future

SUPPLIER RATINGSUPPLIER RATINGPROGRAMPROGRAM

Space & Electronics TRW

WORKING TOWARDS COMMON GOALS, ANDFORMING RELATIONSHIPS FOR THE FUTURE...

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SUPPLY CHAINSUPPLY CHAINMANAGEMENT VISIONMANAGEMENT VISION



Forming Relationships with key members of our Supplier Base, and allowing TRW to provide

products to their customers with a commitment towards the highest levels of quality, through

technical excellence, at an affordable cost,with on-time delivery.

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• Approved Manufacturers Directory

• Supplier Rating Program

Evaluation of Quality Management

Customer Satisfaction- Suppliers Report Card- Subcontracts Report Card

Supplier Quality Performance

Subcontract Quality Performance

Supplier & SubcontractsRating System

Performance Level Summary

Supplier Rating Program

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ApprovedManufacturersDirectory (AMD)



• Based on TRW’s ISO-9001 Registration, TRW is required to Evaluate, Select, and Control Suppliers or Subcontractors.

• TRW requires Suppliers or Subcontractors which will provide deliverable products / materials be approved and listed in TRW’s Approved Manufacturers Directory (AMD).

• The AMD is the result of a consolidation of our prior Manufacturers Evaluation & Control Board (MECB), and the Quality Assurance Supplier Directory (QASD) systems. The AMD process is intended to provide a single system for supplier evaluation, selection, and control.

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Supplier Rating Program



TRW’s Supplier Rating Program will require Suppliers to participate with TRW in an on-going assessment of the Supplier’s Performance. The Suppliers will be evaluated in three areas:

GoldGoldSilverSilverBronzeBronze

CustomerSatisfaction

QualityManagement

SupplierPerformance

Schedule

FinancialQuality

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Evaluation of Quality Management



The Rating Process will evaluate the Supplier and their Quality Management. This isaccomplished using TRW’s QSA-9000, MIL-I, MIL-Q, or NHB Quality Systems Assessment Checklist.

Area Evaluated from TRW QSA-9000 Area Evaluated from MIL-I, MIL-Q, NHB Survey Form

4.1 Management 1 Management for Quality

4.2 Quality System 2 Drawings and Specifications

4.3 Contract Review 3 Control of Procurement

4.4 Design Control 4 Government / Customer Furnished Property

4.5 Document and Data Control 5 Control of Insp. Measuring and Test Equip.

4.6 Purchasing 6 Statistical Qulaity Control

4.7 Control of Customer Supplied Product 7 Control of Procured Supplies and Services

4.8 Product Identification & Treacability 8 Handling and Storage

4.9 Process Control 9 Fabrication Control

4.10 Inspection & Testing 10 Completed End Item Inspection and Test

4.11 Control of Measure. & Test Equipt. 11 Nonconforming Material

4.12 Inspection & Test Status 12 Product Identification

4.13 Control of Nonconforming Product 13 Preservation, Packing and Shipping

4.14 Corrective and Preventive Action 14 Workmanship

4.15 Handlg, Stor, Pkging, Preserv. & Delivery 15 Special Processes

4.16 Control of Quality Records 16 Retention of Inspection and Test Records

4.17 Internal Audit Program 17 Corrective Action

4.18 Training 18 Audit of Reliability and Quality

4.19 Servicing 19 Mil-Std-1535, 1520, 45662, Requirements

4.20 Statistical Techniques

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Quality Management Criteria: • - Must be currently certified to ISO 9001 or ISO 9002 by a third party Registrar, or achieve continuous (12 months) Gold level performance in Customer Satisfaction and Supplier Performance areas. • -Must be certified to TRW’s QSA 9000 Quality Program, and meet the Silver Level performance criteria.• - Currently certified to Mil-I-45208, Mil-Q-9858, or NHB 5300.4, and meet the Bronze Level performance criteria.

Definitions:Minor Nonconformance - Administrative in nature, one-time occurrence; easily correctable.Major Nonconformance - Directly affects product; systemic in nature.

Gold

Silver

Bronze

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Evaluation of Quality Management (Cont.)



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Major Minor

Silver 0 to 2 0 to 9

Bronze 3 to 4 10 to 15

Red > 4 > 15

Major Minor

Bronze 0 to 4 0 to 15

Red > 4 > 15

ISO-registered suppliers are rated Gold based on the successful completion of a 3rd Party ISO assessment. This Gold rating is maintained by the successful completion of continual 3rd Party Registrar evaluations.

Unsuccessful 3rd Party re-evaluations require a QSA Quality Processes Assessment. (See below)

Suppliers MIL-I, MIL-Q, NHB approved cannotobtain a rating greater than bronze. After correction of any documented nonconformance(s), rating improvement will be reflected in the following quarter.

TRW QSA certified suppliers are rated using TRW’s QSA 9000 quality assessment checklist according to the above table. After correction of any documented nonconformance(s), rating improvement will be reflected in the following quarter.

ISO Quality Management Assessment

QSA Quality Management Assessment

MIL-I, MIL-Q, NHB Quality Management Assessment

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Customer Satisfaction



Our customers will be provided the opportunity to submit a Quarterly Report Card on the Suppliers/Subcontractors that they are currently doing business with. They will be assessing the following areas:

- Management- Quality- Technical- Schedule- Financial

These values will composea Customer Satisfaction IndexRating (CSI), which will beused to assess the Supplier’soverall certification status.

TR WMGMT QUALITY TECHNICAL SCHEDULE FINANCIAL CSI

Input #1 4.1 4.4 4.7 3.8 3.0

Input #2 3.8 4.8 N/A 3.5 N/A

Input #3 4.1 4.5 4.5 3.7 2.8

Input #4 3.8 4.4 4.6 3.3 N/A

Input #5 3.9 4.6 4.4 4.0 3.2

Sum 19.7 22.7 18.2 18.3 9.0 87.9 Total Points

No. of Inputs 5 5 4 5 3 22 No. of Inputs

Category Scores 3.94 4.54 4.55 3.66 3.00 3.99 Index Rating

MGMT QUALITY TECHNICAL SCHEDULE FINANCIAL

3.9 4.5 4.6 3.7 3.0

CUSTOMER SATISFACTION REPORT CARD

Customer Satisfaction Index (3.99)Customer Satisfaction

Index Report

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Customer SatisfactionSuppliers Report Card



CUSTOMER SATISFACTION ELEMENTS RATING AVG. CSI

MANAGEMENT1 Responsive to Customer issues and concerns. 12 Supports documentation for all processes. 2

34 Supports a system/process for Quality Assurance. 45 Supports timely communication with TRW 5 15/5=3

QUALITY1 Adheres to the Quality System which TRW has approved. 1

3 Maintains a Corrective & Preventive Action Process 34 Performs against the Quality Flowdown requirements from TRW 45 Supplier processes provide timely communication to TRW 5 15/5=3

TECHNICAL1 Adheres to the processes which TRW has approved. 1

3 Performs against the Procurement Specification requirements 34 Responsive to technical issues and concerns. 45 Supplier processes provide timely communication to TRW 5 15/5=3

SCHEDULE1 Supplier maintains an adequate scheduling system 12 Supplier's scheduling system supports workarounds 23 On time delivery performance 34 Supplier maintains an accurate scheduling system 45 Supplier processes provide timely communication to TRW 5 15/5=3

FINANCIAL1 Cost trends 12 Cost reduction efforts 23 Periodic Cost Reviews 34 Affordability 45 Supplier supports timely communication with TRW 5 15/5=3 3.0

3Supports a work force which identifies and initiates prevention of nonconformities, and implements process improvements.

2Supplier performs work against their Quality System through documented procedures.

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2Performs work against their Engineering Processes through documented procedures.

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The Report Card will be used to evaluate elements for Customer Satisfaction. The evaluationis based on a scale of 1 to 5, and is used to assess the Customers view on the Supplierscommitment on Management, Quality, Technical, Schedule, and Financial. This evaluationwill be used to address areas that are critical to our customers.

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CUSTOMER SATISFACTION ELEMENTS RATING AVG. CSI

MANAGEMENT1 Responsive to Customer issues and concerns. 1

2Directs resources to clearly understand & implement contractual obligations. 2

3 Demonstrates forward planning & institutes preventive measures. 3

4 Manages lower tier suppliers effectively. 45 Provides timely communication with TRW 5 15/5=3

QUALITY

1Performs work & documentation to a Quality System approved by contract. 1

2 Minimum waivers, deviations and nonconformance activities. 23 Product performs acceptably prior to delivery to TRW. 34 Product performs acceptably after to delivery to TRW. 45 Provides timely communication to TRW 5 15/5=3

TECHNICAL

1 Maintains adequate technical systems and processes to contract. 12 Demonstrates technical competance and depth. 23 Performs according to contract technical specifications. 34 Responsive to technical issues and concerns 45 Provides timely communication to TRW 5 15/5=3

SCHEDULE1 Maintains a credible scheduling system 12 Scheduling system supports workarounds 23 On time delivery performance on hardware and documentation. 34 Meets key programatic milestones (PDR, CDR, MRR). 45 Provides timely communication to TRW 5 15/5=3

FINANCIAL1 Maintains a credible cost control system (Cost type) 12 Performs to cost targets (cost type) 23 Accept contract changes to fair and equitable arrangements. 34 Maintains financial viability for contract execution. 45 Subcontractor provides timely communication with TRW 5 15/5=3 3.0

The Report Card will be used to evaluate elements for Customer Satisfaction. The evaluationis based on a scale of 1 to 5, and is used to assess the Customers view on the Subcontractscommitment on Management, Quality, Technical, Schedule, and Financial. This evaluationwill be used to address areas that are critical to our customers.

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Customer SatisfactionSubcontracts Report Card


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Supplier Quality Performance



Suppliers will be assessed based on their ability to meet or exceed thresholds that are established in Quality, Schedule and Financial. The defect prevention program that TRW is currently using , is a Six Sigma Defect prevention Program. The program will focus on “0” Rejects and 100% on time Delivery. TRW’s Supplier Rating & Incentive Improvement Program (SRIIP) will be used to assess Financial.

Acceptance (%)

Period (Months)

On-Time (%)

Period (Months)

GOLD 100 - 98 12 100-96 12

SILVER 97 - 94 12 95-91 12

BRONZE 93 - 90 12 90-85 12

RED < 90 12 < 85 12 <.885

.973 - .931

.930 - .885

SRIIP

1.0 -.974

Supplier Quality PerformanceQuality Schedule Financial

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Subcontracts Quality Performance



Subcontractors will be assessed based on their long term ability to meet or exceed Quality, and Schedule goals. Customer Satisfaction Report Card(s) composite scores for the previous twelve (12) months, will be used to determine a Subcontractors’Quality Performance.

CSI for Quality (%)

Period (Months)

CSI for Schedule

(%)

Period (Months)

GOLD > 4.5 12 > 4.5 12

SILVER > 3.5 12 > 3.5 12

BRONZE > 2.5 12 > 2.5 12

RED < 2.5 12 < 2.5 12CSI = Customer Satisfaction Index

Subcontractor Quality PerformanceQuality Schedule

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Supplier / Subcontracts Rating System



Gold

Silver

Bronze

Exceptional SupplierPerformance, clearly exceeds expectations.Quality Management Score: 0 major, 0-4 minor nonconformancesQuality: 100-98% acceptance for Suppliers, and Subcontractors 4.5 or above of 5 points Customer Satisfaction Quality Performance for 12 months.Schedule: 100-96% on time for Suppliers, and Subcontractors >4.5 or above of 5 points Customer Satisfaction Schedule Performance for 12 months.Financial (SRIIP Score): 1.0-.974 for SuppliersCustomer SatisfactionIndex: 4.5 or above of 5 total points.

Excellent SupplierPerformance, meets or exceeds expectations.Quality Management Score: 1-2 major, 5-9 minor nonconformancesQuality: 97-94% acceptancefor Suppliers and Subcontractors 3.5 - 4.4 points Customer Satisfaction Quality Performance for 12 months.Schedule: 95-91% on time for Suppliers, and Subcontractors 3.5 -4.4 points Customer Satisfaction Schedule Performance for 12 months.Financial (SRIIP Score): .973-.931 for SuppliersCustomer SatisfactionIndex: 3.5 to 4.4, out of 5 total points.

Satisfactory SupplierPerformance,meetingexpectations.Quality Management Score: 3-4 major, 10-15 minor nonconformancesQuality: 93-90% acceptance for Suppliers and Subcontractors 2.5 - 3.4 points Customer Satisfaction Quality Performance for 12 months.Schedule: 90-85% on time for Suppliers and Subcontractors 2.5 - 3.4 points Customer Satisfaction Schedule Performance for 12 months.Financial (SRIIP Score): .930-.885 for SuppliersCustomer SatisfactionIndex: 2.5 to 3.4, out of 5 total points. Performance is evaluated according

to four color-coded standards.

Supplier Performance

7580859095

100

1 2 3 4 5 6 7 8 9 10 11 12

Months

Sta

tus

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Unsatisfactory Supplier Performance,clearly failing to meetexpectations.Quality Management Score: > 4 major, > 15 minor nonconformancesQuality: <90 % acceptance for Suppliers and Subcontractors <2.5 of 5 points Customer Satisfaction Quality Performance for 12 months.Schedule: <85% on time for Suppliers and Subcontractors <2.5 of 5 points Customer Satisfaction Schedule Performance for 12 months.Financial (SRIIP Score): < .885 for SuppliersCustomer SatisfactionIndex: Below 2.5 out of 5 total points.

Red

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Performance Level Summary


WORKING TOWARDS COMMON GOALS, ANDFORMING RELATIONSHIPS FOR THE FUTURE... 14

Quality Mgmt.

Customer Satisfaction

Process ControlCapabilities

Suppliers/Subcontracts

Period

MonthsSuppliers/Subcontracts

Period

Month

Management,Quality, Tech-

nical, Schedule,Financial

Gold 0Maj, 0-4min 100-98/>4.5 12 100-96/>4.5 12 >4.5 of 5

Silver 1-2M, 5-9m 97-94/>3.5 12 95-91/>3.5 12 >3.5 of 5

Bronze 3-4M,10-15 93-90/>2.5 12 90-85/>2.5 12 >2.5 of 5

Red >4M, >15m <90/<2.5 12 <85/<2.5 12 <2.5Only Suppliers

<.885

.930-.885

Supplier Rating & Incentive

Improvement Program

1.0-.974

.973-.931

Cert Level

Quality Schedule Financial

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What could being a TRW Certified Suppliermean to your company?

Established Supplier Relationship with TRW Established Strategic Agreement Alliance. Supported by a TRW Commodity Team/Product Team Empowered to perform selected TRW’s Traditional Source Inspections (In-Process, Pre-Caps, Finals) Product Delivered Direct to Inventory. Delete In-House Testing Requirements (as appropriate). Preferred Supplier for Increased Business Opportunities. Listed in TRW’s Approved Manufacturers Directory (AMD) as a GOLD / Preferred Supplier. Candidate for TRW’s GOLD Supplier of the Year Award.

Candidate for Supplier Relationship with TRW. Candidate for Strategic Agreement Alliance. Candidate for assistance from a TRW Commodity Team/Product Team Candidate for TRW’s Skip Lot Sampling Program Candidate for deletion of In-House Testing Requirements Listed in TRW’s Approved Manufacturers Directory (AMD) as a SILVER Supplier. Candidate for TRW’s SILVER Supplier of the Year Award. Opportunity to become a TRW GOLD Supplier.

Candidate for continued Supplier Relationship with TRW. Candidate for Strategic Agreement Alliance. Candidate for assistance from a TRW Commodity Team/Product Team Candidate for TRW’s Bronze Supplier of the Year Award. Listed in TRW’s Approved Manufacturers Directory (AMD) as a Bronze Supplier. Opportunity to become a TRW SILVER Supplier.

Immediate assessment and plan of action by Commodity Team/ Product Team

Immediate assessment of Active procurements by Management. Placed on AMD Hold Supplier not eligible for future placement of procurements. Candidate for being De-Activated as a TRW Approved Supplier.

GOLD

SILVER

BRONZE

RED

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WORKING TOWARDS COMMON GOALS, ANDFORMING RELATIONSHIPS FOR THE FUTURE... 16

For additional information regarding the Supplier RatingProgram, please contact one of the following individuals:

Key Contacts

• Ivan Kudlacek (Supply Chain Quality) (310) 812-9354

• Robert Jaco (Supply Chain Quality) (310) 812-8017

• Gil George (Subcontracts)(310) 813-7629

Rev.11/15/01

1 forming relationships for the future supplier rating program space & electronics trw working...

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