Why doesn’t re-auditing a supplier sometimes yield the improvements you want as soon as you need them?
It’s standard practice to conduct factory audits to evaluate a new supplier before working together. Some companies and retailers will even arrange to go in again to re-audit them after a number of months.
In China, in particular, many suppliers take the attitude of “wait until the buyer forgets”. So, having a regular re-audit plan should work well to counter that attitude, as it “maintains pressure,” right? Not always.
We have found that coming back and checking the same points does not stimulate improvement. It actually stimulates better paperwork and better justifications on the manufacturer’s side!
How to efficiently drive continuous improvement in a supplier?
In order to drive continuous improvement in your supplier, it often makes a lot of sense to perform a layered process audit on the quality systems and on the operational & support processes in a systematic monthly re-auditing cycle for a period of time where each audit focuses solely on one theme, in more depth. This is especially important for key suppliers with whom you want a long-term relationship.
In a Layered Process Audit program, our auditor re-audits your supplier’s processes and quality systems by focusing on one key aspect per month.
Rather than trying to examine all kinds of quality systems and processes in one day, the auditor makes a plan to systematically examine each one in-depth per month which maximizes the opportunities to identify and correct any problems or inconsistencies.
It also makes it easier for the supplier to think systematically because they are only required to focus on fixing one thing at a time.
An LPA program can be customized to your needs, and suppliers will all have their own features and challenges. However, here’s a typical example of how our auditors may approach assessing your key supplier’s factory:
- Month 1: the measuring & testing instruments (accuracy, precision, users’ training, records…)
- Month 2: the quality control plan (inspection points, inspectors, records…)
- Month 3: maintenance of production equipment
- Month 4: standard work instructions for operators
- Month 5: staff training
- Month 6: mistake proofing and other preventive approaches
- Month 7: labeling and identification
- Month 8: general housekeeping, cleanliness, storage
- Month 9: machine setup
- And so on…
Following the audit, the supplier has 1 month to make corrective changes ready for the auditor’s next visit where the changes will be examined before she moves on to the next target.
A layered process audit program is for importers who are serious about improving their supplier’s performance. This may be because your supplier produces key parts or products and you can’t afford any mistakes or supply chain disruptions, or maybe their results have started to slip over time and you want to take remedial action to get them back to where they need to be, or perhaps because you want to keep working with them long-term and want the reassurance that they’re working at their optimal performance.
Suppliers are unlikely to accept such an intensive program of re-auditing and work to fix and adjust systems and processes if you are not a key customer of theirs. For example, if you account for 40 or 50% of their sales, this is something you could request to put in place, but if you’re a small customer accounting for only 2%, it’s probably not realistic.
A man-day for the auditor performing layered process audits may be split up as follows:
- 30-90 min of follow-up of corrective actions (based on the prior audit’s findings)
- 60-90 min of randomized audit of the quality system (not focused on one area, still lets the auditor get an overview that everything is, broadly, alright)
- The whole afternoon focused on one area (see above, the audit plan will be based on your needs)
In South China our QA team has the experience of working in numerous industries and can audit the following processes, among others:
- General assembly & packing
- General metal machining
- Die casting
- Wood machining for furniture
- Plastic injection molding
- Rubber molding
- Electronics (PCBA)
- Cut & sew for garments & bags
We are able to perform LPA audits in some other key areas, such as Vietnam and India, as well as wider Asia, but please discuss your needs with us in order for us to confirm if we have a suitable engineer locally or need to send one (extra costs may apply for the latter which we will inform you of in advance).
Our auditor’s main findings are laid out in our report, together with comments and photos. It will be quite obvious what the highest sources of risk are.
Each layered process audit monthly report will include:
- Results of corrective work undertaken to improve any issues found in the prior month’s audit
- The main findings of this month’s audit which is focused on one area in particular
- The corrective actions that the supplier has agreed to undertake
How much does it cost?
Costs for an LPA program start at 500 USD per visit in South China (in the Shenzhen/Dongguan area). Quotation on request in other areas and countries.