California Southern University Supply Chain & Quality Organization Questions

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California Southern University


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Managing Supplier Quality: Tiger Devices Emily Madison is a quality engineer assigned to the Injected Molding Commodity Team at Tiger Devices. The commodity team is responsible for evaluating, selecting, and negotiating agreements with plasticinjected molding suppliers to be used throughout Tiger Devices. The team is also responsible for improving service quality and material that Tiger Devices receives from its suppliers. Emily’s role after supplier selection involves working directly with suppliers that require training or technical assistance concerning quality control and quality improvement. The company spends about 65% of each sales dollar on purchased goods and services, so suppliers have a major impact on product quality. Emily just received a call concerning a recurring manufacturing problem at Tiger Devices’ Plant No. 4. The plant buyer said the plant is experiencing some quality variability problems with a key plasticinjected molding component supplied by Eagle Plastics. The component is sometimes too short or too long to fit properly with other components within the finished product. On occasion, the bracket snaps, causing end-product failure. Although the unit cost of the plastic-injected molding component is only $1.59, these quality issues (length variability and snapping) are creating production problems that far exceed the component’s purchase price. The local buyer announced he was having difficulty resolving the problem and asked for support from the corporate commodity team. The buyer said, “You corporate folks selected this supplier that we all have to use. The least you can do is to help us out of the jam your supplier choice is causing.” The buyer’s comment surprised Emily, although Emily would soon come to understand that plant personnel resented not being able to select their own suppliers. After investigating the problem during a tension-filled meeting with Plant No. 4 personnel, Emily determined she would have to visit the supplier directly. She would work with Eagle’s process engineers to address the manufacturing variability caused by the nonconforming component. Emily went back and reviewed her team’s actions when selecting a single supplier to provide an entire family of plasticinjected moldings. Eagle had quoted the lowest price of all competing suppliers and had provided samples that passed Tiger Devices’ engineering tests. Upon her arrival at the supplier, Emily learned that Eagle did not have a dedicated process engineer. One engineer, Daniel Jacobs, was responsible for plant layout, process, quality, and industrial engineering. This individual, who was hired only two months previously, was still becoming familiar with Eagle’s procedures. When Emily asked to review the supplier’s quality control procedures, Daniel had to ask several people before he could locate Eagle’s procedures manual. Emily decided that her first step should be to understand the process responsible for producing the defective component. At an afternoon meeting, Emily asked Daniel for actual output data from Eagle’s process. Daniel explained they did not collect data for process capability studies or for statistical control charting of continuous production. However, he did say that sometimes “things don’t seem to be operating well” with the equipment that produces the component. Eagle uses an inspector to examine every finished item to determine if it should be shipped to the customer. After explaining the basics of process capability to Daniel, Emily asked him to collect data from the process that produced the bracket component. Emily requested that Daniel take exact measurements periodically from the process so they could draw statistical conclusions. Emily said she would return in three days to examine the data. Upon her return three days later, Daniel shared with Emily the details of the data collection effort. Once Emily calculated a preliminary process capability from this data and examined the training and quality control procedures at Eagle, she realized she had some serious work ahead of her. Assignment 1. Is Tiger Devices being reactive or proactive when it comes to managing supplier quality? Why? 2. Discuss the possible advantages of negotiating quality requirements directly into supplier contracts. 3. What is the risk of relying on product samples when selecting suppliers? What is the risk of relying too heavily on unit cost when making the selection decision? 4. Why was it so important for Emily to work with Plant No. 4 personnel before visiting Eagle? 5. The local buyer at Tiger Devices did not seem pleased that a corporate team selected the supplier that the local plants must use. Why do firms use corporate commodity teams to select suppliers? How can firms get support from plant personnel for companywide suppliers? 6. Is quality a major emphasis at this supplier? Why or why not? 7. What are the possible effects if Eagle’s inspector approves components for shipment that should be rejected due to nonconformance (Type II error)? What are the possible effects if Eagle’s inspector rejects components for shipment that are in conformance with specifications (Type I error)? How can we control error of measurement? 8. When evaluating supplier quality, why is it important to focus on the process that produces the material or service rather than on the material or service itself? What did Tiger Devices rely on? 9. If Tiger Devices decides to continue using Eagle as a supplier, what must both companies do to begin improving Eagle’s component quality? 10. Design a supplier quality management process for Tiger Devices that focuses on the prevention of supplier defects. (Hint: Activities performed during supplier evaluation and selection should be part of this process. Process capability analysis may also be part of your supplier quality management process.)
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Question 1

Most of the integrated devices become more reactive when dealing with the matter of
managing the quality of suppliers. In this case, the organization failed to audit the Eagle supplier
regularly to enhance recurring handling which resulted using supplier's quality organization
systems to the supplier’s system of rating. The organization noticed that it might take too long to
find a faulty supplier since the buyers complained about plastics injected with molding sections.
Hence, it was hard for them to fit them accurately for them to have the finished product.

Question 2

Negotiating on the quality required by the supplier contract helps to avert disagreements
on the commodity purchased between the supplier and the company, ensuring a better relationship
with the supplier. It also aids the company in acquiring quality commodities from the supplier.
Through quality requirements, a company will scale down the cost and not lose the customer. It is
very ...

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