LESSON 3 Higher-Level Quality Requirements and Supplier Responsibilities 15November2013 Lesson 4: Safety Stock

Lesson Introduction Given a contract, you will be able to identify the supplier’s responsibility to higher-level quality requirements.

Lesson Objectives Upon completion of this lesson, you should be able to: Describe the purpose for higher-level quality requirements in a contract. Identify the required quality specifications for contracts. Describe the relationship of Quality Management System (QMS) to higher-level quality requirements. Identify the supplier’s responsibilities pertaining to Quality Assurance (QA). Explain why a supplier would choose to use a Single-Standard Quality System. Lesson 4: Safety Stock

Lesson Topics This lesson will cover the following topics: Purpose of Higher-Level Contract Requirements Required Quality Standards for Contracts QMS and Higher-level Quality Requirements Relationship Supplier’s Responsibility to QA Supplier’s Use of Single- Standard Quality System

WIIFM? This lesson will help you: Work with the supplier in upholding their responsibilities when higher-level requirements are in place in a contract Understand your QA responsibilities when a contract requires the supplier to perform QA activities Understand why a supplier might choose to use a single-standard quality system for multiple contracts

Authority Federal Acquisition Regulation (FAR) 42.302(a)(38) – Ensure supplier complies with contractual QA requirement FAR 46.202-4 – Requires compliance with higher-level quality standards in contracts for complex or critical items to control work operations, in-process inspections, ….. FAR 52.246-11 – Specific format for the inclusion of Higher-Level Contract Quality Requirement(s) in a contract

Definitions – Contract Items Complex – Items with quality characteristics not wholly visible in the end item Critical – Application of an item in which failure of the item could injure personnel or jeopardize a vital agency mission Critical items – Items having significant effect on the production realization and use of the product

Definitions – Quality Management System Quality Management System (QMS) – System of quality management that includes all activities of the overall management function that determines the quality policy, objectives, and responsibilities and their implementation QMS

Purpose of Higher-level contract requirements Lesson Topics: Purpose of Higher-Level Contract Requirements Required Quality Standards for Contracts QMS and Higher-Level Quality Requirements Relationship Supplier’s Responsibilities to QA Supplier’s Use of Single-Standard Quality System

Topic 1: Purpose of Higher-Level Contract Requirements Typical quality requirements FAR Industry Military Purpose of higher-level quality requirements

Typical Quality Requirements - FAR 52.212-4, Contract Terms and Conditions – Commercial Items 52.246-1, Contractor Inspection Requirements 52.246-2 through -9, Standard Inspection 52.246-11, Higher-Level Contract Quality Requires a Standard Inspection clause and standard cited in contract

Typical Quality Requirements - Industry International Organization for Standardization (ISO) 9000 series (1987 to Present) 9001:1987, QA in Design/Development, Production, Installation and Servicing 9002:1987, QA for Production, Installation, Servicing 9003:1987, QA for Inspection and Test 9001:2000, Single Standard for QMS (9001:2008 update) Aerospace Standard (AS) 9100 (1999), AS9100:2009, QMS Requirements for Aerospace, Defense, and Space SAE International Aerospace Standards (SAE AS) Other approved standards

Typical Quality Requirements - Military MIL-I-45208A (1960-1996), Inspection System Requirements MIL-Q-9858 (1959-1996), Quality Program Requirements

Purpose of Higher - Level Quality Requirements Control work operations, in- process controls, and inspections Bring attention to organization, planning, work instructions, documentation control, and advanced metrology Help ensure quality requirements are met on complex and critical items

Question and Answer Contracts with FAR 52.246-11 as one of the listed clauses should always also list _______________. Drawings or specifications A supplier’s manufacturing plan Quality standards Surveillance plans

Required Quality Standards for Contracts Lesson Topics: Purpose of Higher-Level Contract Requirements Required Quality Standards for Contracts QMS and Higher-Level Quality Requirements Relationship Supplier’s Responsibilities to QA Supplier’s Use of Single-Standard Quality System

Topic 2: Required Quality Standards for Contracts A documented QMS is required for contracts with a higher- level quality requirement.

QMS Documentation Contracts with higher-level quality requirements require supplier to establish and maintain a documented QMS QMS documentation may consist of: Supplier Quality Manual or contract-specific Quality Plan Support process procedures, may be part of Quality Manual/Plan Manufacturing process procedures, to include inspection and testing DCMA does NOT approve/accept supplier’s QMS, but reserves the right to disapprove procedures based on the results of Government Contract Quality Assurance (GCQA) surveillance.

QMS Required Documentation Six specific ISO9001 clauses require documented procedures: Control of documents (4.2.3) Control of records (4.2.4) Internal audit (8.2.2) Control of nonconforming product (8.3) Corrective actions (8.5.2) Preventive actions (8.5.3)

Question and Answer What documentation would be included in a supplier’s ISO9001 QMS? Manufacturing Maintenance Schedule Supplier’s Quality Manual Supplier’s Personnel Work History Production Maintenance Records

QMS and Higher-Level Quality Requirements Relationship Lesson Topics: Purpose of Higher-Level Contract Requirements Required Quality Standards for Contracts QMS and Higher-Level Quality Requirements Relationship Supplier’s Responsibilities to QA Supplier’s Use of Single-Standard Quality System

Topic 3: QMS and Higher-Level Quality Requirements Relationship Higher-level quality requirements include: QMS information ISO9001 standards AS9100 standards ISO9001/AS9100 clauses AS9100

QMS QMS Information Quality Management System’s: Limited allowable exclusions must be listed in the Quality Manual Purpose is customer satisfaction and continuous improvement Intent is to prevent nonconformity Documentation via records Not required by DoD to be third party certified QMS

ISO9001 and AS9100 Standards ISO9001 standards are meant to include small companies to larger organizations AS9100 includes ISO9001 standards, but enhances with requirements for the aerospace industry AS9100 is more stringent than ISO9001, adding a significant number of requirements and notes to the ISO9001 QMS defining clauses

ISO9001 ISO9000 first published in 1987 to: Meet product-related statutory and regulatory requirements Ensure organizations met the needs of customers and stakeholders Based on British Standards (BS) 5750 standard series from British Standards Institution (BSI) Current version ISO9001:2008

AS9100 Americas Aerospace Quality Group (AAQG) formed in 1995 to standardize quality requirements for the industry. FAA D1-9000 ISO-9001 MIL-Q DoD AS9100 AAQG Process Output Inputs Company-specific Requirements Inputs from: International Aerospace Quality Group (IAQG) European Aerospace Quality Group (EAQG) Asia Pacific Aerospace Quality Group (APAQG) MIL-I NASA Used with permission of SAE and Mr. Dale K. Gordon

Question and Answer Besides controlling nonconformities, what is the purpose of the QMS? Listing quality standards from the Government Ensuring customer satisfaction and continuous improvement Documenting GCQA surveillance plans Compiling AS9100 and ISO9000 standards

ISO9001/AS9100 Clauses ISO9001:2008/AS9100 has eight clauses, last five define QMS: Scope Normative Reference Terms and definitions Quality Management System Management responsibilities Resource management Product realization Measurement, analysis, and improvement

ISO9001/AS9100 Clause 4 Quality Management System 4.1 General Requirements 4.2 Documentation Requirements 4.2.1 General 4.2.2 Quality Manual 4.2.3 Control of documents (required documentation) 4.2.4 Control of records

ISO9001/AS9100 Clause 4 (cont.) Clause 4 requires the supplier to: Establish, document, implement, and maintain a QMS and continually improve its effectiveness Document its quality policy, objectives, and manual Manual should reflect QMS scope Document procedures for control of documents and records Procedures will vary depending on size and type of activity performed, process complexity, and personnel competency

ISO9001/AS9100 Clause 5 Management Responsibilities 5.1 Management Commitment 5.2 Customer Focus 5.3 Quality Policy 5.4 Planning 5.5 Responsibility, Authority, and Communication 5.6 Management Review

ISO9001/AS9100 Clause 5 (cont.) Clause 5 requires the supplier’s top management to: Demonstrate commitment to developing and implementing the QMS and continuously improving the system Determine customer requirements and enhance customer satisfaction Ensure quality policy is appropriate to the organization Establish measurable quality objectives consistent with the quality policy Appoint a management representative with necessary authority relative to the QMS Ensure management reviews QMS for suitability, adequacy, effectiveness, and improvement opportunities

ISO9001/AS9100 Clause 6 Resource Management 6.1 Provision of Resources 6.2 Human Resources 6.3 Infrastructure 6.4 Work Environment

ISO9001/AS9100 Clause 6 (cont.) Clause 6 requires the supplier to: Provide resources to implement and maintain QMS, its improvement, and to enhance customer satisfaction Ensure personnel assignments are relative to and effectively achieve the quality objectives Provide and maintain an infrastructure to include buildings, hard/software equipment, and support services Manage work environment to achieve conformity to product requirements

ISO9001/AS9100 Clause 7 Product Realization 7.1 Planning of Product Realization 7.2 Customer-related Processes 7.3 Design and Development 7.4 Purchasing 7.5 Product and Service Provision 7.6 Control of Monitoring and Measuring Equipment

ISO9001/AS9100 Clause 7 (cont.) Clause 7 requires the supplier to: Plan product realization to include surveillance and testing for acceptance Determine requirements as specified by the customer and product usage in addition to contractual requirements Plan design/development reviews, surveillance and change controls Ensure quality of purchased product and that product satisfies purchase requirements Identify calibration requirements for equipment and devices, including software if used to monitor/measure

ISO9001/AS9100 Clause 8 Measurement, Analysis, and Improvement 8.1 General 8.2 Monitoring and Measurement 8.2.2 Internal Audit (required documentation) 8.3 Control of Nonconforming Product (required documentation) 8.4 Analysis of Data 8.5 Improvement 8.5.2 Corrective Actions (required documentation) 8.5.3 Preventive Actions (required documentation)

ISO9001/AS9100 Clause 8 (cont.) Clause 8 requires the supplier to: Implement measurement, analysis, and improvement for products and QMS conformity/effectiveness Monitor/measure customer satisfaction, internal audits, processes, and product Three types of audits: First Party, Second Party, and Third Party Ensure control of nonconforming products Analyze relevant data on customer satisfaction, product requirement conformity, and process and product trends Ensure continual improvement through quality policy/objectives, audit results, corrective/preventive actions and management review

Allowable Exclusions ISO9001:2008, 1.2 Application Based on the premise that all ISO9001 requirements are generic and intended to be applicable to all organizations Where requirement(s) cannot be applied due to the nature of an organization and its product, consider for exclusion When exclusions are made, claims of conformity to ISO9001:2008 are not acceptable UNLESS: Exclusions are limited to the requirements within ISO9001:2008, Clause 7 Exclusions do not affect organization's ability/responsibility to provide product that meets customer, statutory, and regulatory requirements

Higher-Level Quality Requirements and QMS Higher-level quality requirements specify quality controls for product/service and the QMS details the supplier’s plan and implementation of actions to fulfill those requirements. Higher-Level Quality Requirements: The QMS: Are listed in the contract: ISO9001 AS9100 Others Outlines supplier’s actions to meet higher-level quality requirements Control the quality of complex and critical items Identifies quality controls intended to prevent nonconforming items Require documentation to substantiate that products/services meet requirements Documents quality requirement fulfillment through process procedures, work instructions, and records

Question and Answer “Product Realization” is the title of ISO9001/AS9100 clause ____. 4 5 6 7

Question and Answer ISO 9001/AS9100 clause 5 that deals with customer focus, quality policy, and planning is titled “___________________.” Quality Management System Resource Management Product Realization Management Responsibilities

Question and Answer Which are required documentation for ISO9001/AS9100 clause 4? (Select all that apply.) Control of documents Control of measuring equipment Control of records Control of nonconforming product

Supplier’s Responsibilities to QA Lesson Topics: Purpose of Higher-Level Contract Requirements Required Quality Standards for Contracts QMS and Higher-Level Quality Requirements Relationship Supplier’s Responsibilities to QA Supplier’s Use of Single-Standard Quality System

Topic 4: Supplier’s Responsibilities to QA FAR Part 46 outlines: Contractor (supplier) responsibilities Inspection by contractor (supplier) Exceptions to contractor (supplier) inspections

FAR Requirements FAR Part 46 46.105, Contractor Responsibilities 46.202, Government reliance on inspection by contractor

Contractor (Supplier) Responsibilities According to FAR 46.105, supplier must carry out contractual QA obligations by: Controlling quality of product/ service Ensuring their vendors have acceptable quality control system Maintaining evidence that products/services conform to contract quality requirements Tendering to the Government ONLY products/services that conform to contract requirements

Inspection by Contractor (Supplier) FAR46.202-2, Government relies on the contractor to ensure products/services acquired at or below the simplified acquisition threshold conform to contract quality requirements by inspecting and testing prior to Government submission. Supplier Approved

Inspection by Contractor (Supplier) Exception Government shall not rely on inspection by contractor if the contracting officer determines a need: For Government test of supplies in advance of tender for acceptance To pass judgment on adequacy of contractor’s internal work processes Government Approved

Question and Answer What is the most important facet of FAR 46.105 in terms of the supplier’s contractual responsibilities to quality assurance? Relying only on the Government’s inspection of products/services Tendering to the Government only products/services that conform to contract requirements Acquiring only products/services below the simplified acquisition threshold Submitting to the customer products/services inspected only by the supplier

Supplier’s Use of Single-Standard Quality System Lesson Topics: Purpose of Higher-Level Contract Requirements Required Quality Standards for Contracts QMS and Higher-Level Quality Requirements Relationship Supplier’s Responsibilities to QA Supplier’s Use of Single-Standard Quality System

Topic 5: Supplier’s Use of Single-Standard Quality System Single-standard quality system is a system of control that applies to both Government and Commercial material. Supplier’s Single-Standard Quality System Contract 1: ISO9001 Quality System Contract 2: Boeing Quality Management System Contract 3: AS9100 Program Contract 4: Ford Motor Company Quality System

Single-Standard Quality System Supplier chooses single-standard quality system because it eliminates duplication of effort. Supplier must: Track product quality requirements on a contract-by-contract basis Identify a hold point in the production cycle to segregate Government items if identical/similar to commercial items

Summary Having completed this lesson, you should now know that: Higher-level quality requirements are inserted in a contract to better control those items that are complex or critical in nature and bring awareness to the associated planning and processes Both the supplier and QAS have specific responsibilities when higher-level quality requirements are specified in a contract ISO9001 and AS9100 standards are identified in contracts to ensure the supplier’s product/service meet specific quality requirements Single-standard quality systems allow the supplier to more efficiently control and generate products/services Lesson 4: Safety Stock

Summary (cont.) Having completed this lesson, you should now know that: QAS is responsible for providing oversight to the supplier in its efforts to create products/services that conform to contract quality requirements Supplier is ultimately responsible for the quality of its products/services prior to submission to the Government for acceptance Lesson 4: Safety Stock

Questions

Review Question 1 In addition to controlling work operations and bringing attention to planning, higher-level requirements also _________________________. Provide higher-level management product examination reports Ensure quality requirements are met on complex and critical items Guide the supplier’s process review scheduling Mandate the supplier’s use of a single-standard inspection system

Review Question 2 Which of these documentation items is found in a supplier’s Quality Management System? Applicable ISO9001 Clauses Technical Drawings Manufacturing Deliverables Quality Manual

Review Question 3 Higher-level quality requirements specify quality controls for product/service and the QMS does what in relation to this? Specifies the product/service surveillance activities Details the DCMA’s plan to inspect the supplier’s product/service Outlines the product/service the supplier will manufacture Details the supplier’s plan and implementation of actions to fulfill the higher-level requirements

Review Question 4 Which of these is a supplier’s responsibility to QA? Inspecting products/services after the Government has made an initial inspection Applying the DCMA’s process review criteria to their internal reviews Ensuring their vendors have an acceptable quality control system Recording the results of the Government’s GCQA activities in their facility

Review Question 5 In addition to being easier to manage and less costly to maintain, what other benefits does a single-standard system offer the supplier? Fulfills higher-level requirements with in subcontracts Eliminates duplication of effort Ensures all products are manufactured using identical processes Uses less personnel to manage the facility quality assessment procedures