5.1 Governance and Operating Model

Supplier Quality Management (SQM) isacts as the technical firewall separating external supply chain entropy from your internal manufacturing stability. UnlikeWhile Procurement, whichProcurement optimizes for cost and deliverylogistics (Commercial), SQM optimizesmust ruthlessly optimize for Risk and Capability (Technical). This chapter mandatesdefines the operational architecture required to extend process control beyond the factory walls, ensuringtreating external partners functionnot as reliablevendors, but as remote extensions of the internal production line.

Mission and Boundaries

The Supplier Quality Engineer (SQE) operates withrequires absolute separation of powers from Procurement. This separation is criticalProcurement to prevent the conflict of interest inherent in prioritizing "cheaper" over "compliant."

• If the issue is Technical (Capability, Risk, Specification) –-> SQE owns the decision.
  • Mandate: Exercise veto power over new suppliers based on audit results.
  • Mandate: Block or Quarantine suspect material immediately. This authority overrides production urgency.urgency to prevent catastrophic field failure.
  • Mandate: Own the Supplier Corrective Action Request (SCAR) cycle from initiation to validation.
• If the issue is Commercial (Price, Terms, Logistics) –-> Procurement owns the decision.
  • Mandate: Negotiate pricing, payment terms, and contracts.
  • Mandate: Select the partner from the SQE-qualified list.
  • Mandate: Expedite late deliveries.

Pro-Tip: Never allow "Commercial Leverage" to override a "Technical Veto." If a supplier is technically incapable, no price discount can compensate for the resulting line-down risk.risk or recall cost.

Authority Matrix (RACI Logic)

Ambiguity during a quality spill is a failure mode. adhereAdhere to the following decision logic to maintain velocity.

• Scenario: New Supplier Qualification

• SQE:SQE (Accountable): Accountable. Validates technical capability.
• Procurement:Procurement (Consulted): Consulted. alignsAligns commercial terms.

Scenario: Stop Ship / Quarantine Stock

• SQE:SQE (Accountable): Accountable. Executes the physical and digital block.
• Operations:Operations (Informed): Informed. Adjusts production planning.

Scenario: Deviation Approval

• Engineering:Engineering (Accountable): Accountable. Only design authority can waive a specification.
• SQE:SQE (Consulted): Consulted. Assesses risk of the deviation.

Scenario: Recovery Cost Negotiation

• Procurement:Procurement (Accountable): Accountable. Recoups financial losses from the supplier.
• SQE:SQE (Informed): Informed. Provides technical evidence of the failure.

The Operating Lifecycle

TheTreat the SQM lifecycle isas a closed-loop control system. Dosystem, not treat these asa linear administrative steps; they are gates that must be cleared to proceed.path.

Phase 1: Qualification (Pre-PO)

• Input: Procurement nominates a potential source.
• Action: Execute Risk Assessment and On-Site Audit (VDA 6.3 / ISO 9001).
• Logic:
  • If Audit Score ≥ Threshold –-> Pass. Add to Qualified Vendor List (QVL).
  • If Audit Score < Threshold –-> Fail. Assign "Do Not Use" status.status to prevent PO generation.

Phase 2: Incoming Control (Active)

• Input: Material arrives at Dock.
• Action: IQC inspects per the SQE-defined Sampling Plan.
• Logic:
  • If Compliant –-> Release to Stock.
  • If Non-Compliant –-> Reject to MRB.

Phase 3: Escapes & Reaction (Reactive)

• Input:Action: Defect detected on Line or Field.
• Action:Logic: Initiate Containment (24h) and issue SCAR.

Phase 4: Resolution & Monitoring (Sustaining)

• Input:Action: Supplier submits CAPA.
• Action:Logic: Verify Permanent Corrective Action (PCA).
• Metric: Updateand update Supplier Scorecard.

Interface with Internal Stakeholders

The SQE operates as the system architect for external quality, requiring precise interfaces with internal teams.quality.

• Interface with IQC: The
  • SQE acts(Legislator): as the "Legislator" (definesDefines the inspection plan and limit samples), while samples.
  • IQC acts(Enforcement): asExecutes the "Enforcement" (executes the plan).
    plan.
    • Requirement: Provide clear, binary acceptance criteria. Ambiguous instructions lead to false rejects or escapes.
  • Interface with Production: Production is the primary customer.
    • Requirement: If bad parts stop the line, SQE presence on the floor is required within 15 minutes to assess impact.
  • Interface with Program Management (PM):
    • Requirement: Define the "Risk Profile" for NPI. If a supplier is high-risk, mandate "Safe Launch" protocols (e.g., 100% source inspection).
      
      Required Quality Records (The "Evidence Pack")
    Suppliers must generate and retain specific records for every manufacturing lot. These records must be retrievable within 24 hours upon request.
    • Retention Period:
      • Standard: 5 Years.
      • Safety Critical / Automotive: 15 Years.
      • Medical: Indefinite (Lifetime of product + 2 years).
    • The
    "Lot History Record" (LHR):
    1. Traceability: Raw material lot codes (e.g., Resin Batch #, PCB Date Code) linked to the finished unit serial number.
    2. Process Parameters: Reflow oven profiles, Molding press settings, or Crimp pull test values for the specific production run.
    3. Inspection Results: First Article Inspection (FAI) report, In-Process QC logs, and Final QC (OBA) reports.
    4. Test Data: Pass/Fail logs for every serialized unit (ICT/FCT).
    5. Personnel: ID of the operators and inspectors who touched the lot.

    The Supplier Risk Rating Model

    Risk is not a feeling; it is a calculated score.score, Everynot a feeling. Assign every active part/supplier combination is assigned a risk tier based on weighted technical inputs.

    • inputs: Risk FactorsCriticality (Inputs):
      1. Criticality (40%): Does this part affect Safety (e.g.Safety/Function), High Voltage) or Function (e.g., CPU)? (High/Med/Low).
      2. Process Maturity (20%):Auto Doesvs theManual), supplier use automated inspection (AOI) or manual visual check? (Auto/Manual).
      3. Quality History (20%):SCARs), Haveand there been any SCARs or MRB rejects in the last 12 months? (Yes/No).
      4. Complexity.
         (20%): Is the part a custom mechanical assembly (High Risk) or a standard passive component (Low Risk)?
    • The Risk Tiers:
      • If Tier 1 (High Risk): -> Custom Mechanics, Safety Critical Parts, or New Suppliers (< 6 months).
      • If Tier 2 (Medium Risk): -> Standard Active Components (ICs), Connectors.
      • If Tier 3 (Low Risk): -> Standard Passives (Resistors, Capacitors), Hardware (Screws).Hardware.

    Control Levels (The Response)

    The Risk Tier determines theAdjust "Inspection Intensity" at the receiving dock.dock based on the Risk Tier.

    Level 1: Tightened Inspection (High Risk)

    • ScopeScope:: New Suppliers (NPI), suppliers on Probation (Grade C), or Critical Safety Items.
    • MandateMandate::
      • Sampling PlanPlan:: AQL 0.4 / Level II (High sample size).
      • DocumentationDocumentation:: Full Certificate of Analysis (CoA) with actual measurement data required.data.
      • Safe LaunchLaunch:: The first 3 lots from a new supplier must undergoMeasure 100% measurement of Critical Dimensions (CDs) for the first 3 lots before moving to sampling.

    Level 2: Normal Inspection (Medium Risk)

    • ScopeScope:: Established suppliers with stable performance (> 6 months w/o SCAR).
    • MandateMandate::
      • Sampling PlanPlan:: AQL 1.0 / Level II.
      • ChecksChecks:: Verification of MPN, Date Code, Packaging condition,Packaging, and basic dimensional check (Key Characteristics only).
      • Documentation: Standard Certificate of Conformance (CoC).check.

    Level 3: Skip-Lot / Dock-to-Stock (Low Risk)

    • ScopeScope:: Preferred Suppliers (Grade A) providing commodities (e.g., Yageo, Vishay).commodities.
    • MandateMandate::
      • Sampling PlanPlan:: Inspect 1 out of every 5 lots (Skip-Lot).lots.
      • Flow: Material moves directly from Dock to Warehouse.
      • RevocationRevocation:: A single line-reject immediately revokes Dock-to-Stock status for 3 lots.

    Dynamic Risk Adjustment

    The system is not static. Performance drives the control level. The system must adapt dynamically.

    • Escalation (Tightening)::
      • TriggerTrigger:: A single field failure or Line Down incident.
      • ActionAction:: SupplierMove movessupplier immediately to Level 1 (Tightened).
      • DurationExit Criteria:: Minimum 3 consecutive clean lots required to de-escalate.
    • De-Escalation (Relaxing)::
      • TriggerTrigger:: 10 consecutive lots accepted with zero defects.
      • ActionAction:: SupplierMove movessupplier to Level 3 (Dock-to-Stock) to saveoptimize IQC labor.

    Evidence & Records

    Supplier Quality Requirements Index (The "Contract")

  We do

  Do not rely on "Standard Industry Practice." We rely onIncorporate specific Dannie Standards. These documents are incorporatedStandards by reference into every Purchase Order (PO).

  • Binding Mechanism: The PO states: "Seller agrees to comply with the Dannie Supplier Quality Manual (SQM) Rev X." Acceptance of the PO constitutes legal acceptance ofof:
    these rules.
  • The Index (Hierarchy of Authority):
    1. The Drawing (2D/3D):: The absolute truth.truth (Dimensions, Material).
    2. The SpecificationSpecification:: Performance requirements (e.g., "Must withstand 85°C").requirements.
    3. The Quality Manual (SQM):: TheProcedural procedural rules (Sampling, SCARs, Audits).rules.
    4. External StandardsStandards:: IPC-A-610, ISO 9001.

  Evidence Submission (The "Virtual Lock")

  For Critical Tier 1 suppliers, we do not just "trust" they have the records; we demand the evidence upfront.

  • The "Ship-to-Stock" Gate:
    • RequirementGate:: The supplierSupplier must upload the Certificate of Analysis (CoA)CoA and Measurement Report to the Dannie Supplier Portal before the shipment leaves their dock.
    • ValidationValidation:: The systemSystem blocks the "ASN"ASN (Advance Ship Notice) if the evidence is missing or shows out-of-spec data.spec.
  • CoC (Certificate of Conformance):
    • Mandatory Statement: "We hereby certify that these goods were manufactured in accordance with Drawing Rev X and PO # Y."
    • Signature: Must be signed by a Quality Manager, not a Sales Rep.

  Audit Defense and Retrieval

  Suppliers must retain records (Lot History Record, Traceability, Process Parameters) and retrieve them within 24 hours upon request.

  • If Standard: Retain 5 Years.
  • If Safety Critical / Automotive: Retain 15 Years.
  • If Medical: Retain Indefinite.

  Pro-Tip: If a field failure occurs, the "24-Hour Rule" applies.

  • Scenario: A battery fire occurs in the field.
  • Demand: Dannie demands the "Reflow Profile" and "Battery Batch # Traceability" for the specific date of manufacture.
  • Failure: If the supplier cannot produce the record"Reflow Profile" or "Batch Traceability" within 24 hours,hours of a field failure, they are presumed liable for the failure due to lack of process control.

  
  

Final Checklist

Control Point	Requirement / Threshold	Non-Negotiable Rule
Authority	Technical Veto	SQE can block any shipment or supplier regardless of Commercial pressure.
New Suppliers	Audit Score	If Audit < Threshold, Supplier is Fail (Do Not Use).
High Risk Control	AQL 0.4 / Level II	Critical Safety Items or New Suppliers must face Tightened Inspection.
Safe Launch	100% Measurement	First 3 lots from new supplier require 100% check of Critical Dimensions.
Escalation	1 Failure = Level 1	Any Line Down/Field Failure triggers immediate return to Tightened Inspection.
Record Retention	24-Hour Retrieval	Failure to produce records within 24h implies liability.
Binding	PO Acceptance	PO must reference the SQM and Drawing as the primary truth.