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Document Number: FMS-QMS-4-079-00
Revision: B
flexTitle: SRS Internal Training and General Information
Document Owner: Alejandra Vargas
CONFIDENTIAL
SRS General Information
Alejandra VargasSupplier Quality Engineer
Document Number: FMS-QMS-4-079-00
Revision: B
flexTitle: SRS Internal Training and General Information
Document Owner: Alejandra Vargas
Supplier Quality System SRS
Definitions and Acronyms 3
Introduction 4
SRS Measurements & Weights for Final Score 6
SRS Measurements 7
Actions Based On SRS Final Score 19
Quarterly Scorecard Distribution 20
SRS Scorecard Template 21
1
Document Number: FMS-QMS-4-079-00
Revision: B
flexTitle: SRS Internal Training and General Information
Document Owner: Alejandra Vargas
Supplier Quality System SRS
DEFINITIONS and ACRONYMS
SRS Supplier Rating System
GCM Global Commodity Manager
SCAR Supplier Corrective Action Request
CRP Continuous Replenishment Program
JIT Just-In-Time
PO Purchase Order
MDSS
Materials Decision Support System. An application from the MicroStrategy
suite used for online analytical data processing and reporting; also known
as cubes.
SQE Supplier Quality Engineer
RFQ Request For Quote
OTD On-Time Delivery
QUALfx Global Quality System Tool
2
Document Number: FMS-QMS-4-079-00
Revision: B
flexTitle: SRS Internal Training and General Information
Document Owner: Alejandra Vargas
SRS Introduction
PURPOSE:
This document provides detailed instructions in the proper use and understanding of the SRS
4.0 metrics defined in Supplier Rating System, FMS-QMS-2-005-00.
SCOPE:
This process is applicable to all Flex operations. This includes all Flex materials groups,
procurement personnel, GCMs, SQEs, and any other Flex employee involved in the
procurement process or that have a procurement relationship with supplier performance.
3
Document Number: FMS-QMS-4-079-00
Revision: B
flexTitle: SRS Internal Training and General Information
Document Owner: Alejandra Vargas
SRS Introduction
BACKGROUND
Flex’s SRS 4.0 is a Supplier Management Tool with the following benefits:
Provides objective supplier information to our customers and suppliers.
Ensures continuous supplier improvement through quarterly performance scorecards assessing
suppliers’ quality, delivery, price, and responsiveness in order to promote world-class suppliers and
create continuous improvement in supplier performance.
Facilitates constructive discussion in the context of quarterly business reviews (QBRs) that Flex
Procurement Teams hold with suppliers.
Flexible enough to be used by all sites and business groups.
Data used for SRS 4.0 is systemic and refreshed quarterly. Line item transactions are extracted and
calculated from MDSS, through a Cube.
Any supplier activity (purchase orders, pricing, terms, etc.) that is managed outside an ERP (Enterprise
Resource Planning) system is not considered in SRS 4.0. Any ERP system not linked to MDSS is also
not considered.
4
Document Number: FMS-QMS-4-079-00
Revision: B
flexTitle: SRS Internal Training and General Information
Document Owner: Alejandra Vargas
SRS Measurements & Weights for Final Score
5
MEASUREMENTS
SRS rates criteria made up of eight
measurements.
The overall score is achieved by a
fixed weighted average according
to the Supplier Type. The final
score is a weighted average
aggregated score.
The highest overall score for these
measurements combined is 4.00.
If one measurement is “N/A”, then
the weight of the item is divided
and proportionally aggregated to
the remaining items.
Document Number: FMS-QMS-4-079-00
Revision: B
flexTitle: SRS Internal Training and General Information
Document Owner: Alejandra Vargas
6
SRS Measurements
On-Time Delivery % (Supplier Promised Date)
Purpose: To improve On-Time Delivery, which will ultimately increase manufacturing efficiency based on the receipt transaction
tables in MDSS. If the receipt date is not earlier than 3 days from the confirmed or changed delivery date and not later than 2 days
from the confirmed or changed delivery date, it is considered “On-Time”.
Note: The calculation is based on WorkingDays.
Score Definition
0.00 Less than 70%
1.00 Greater than or equal to 70% and less than 80%
2.00 Greater than or equal to 80% and less than 90%
3.00 Greater than or equal to 90% and less than 95%
4.00 Greater than or equal to 95%
S DELIVERIES - 3 TO +2 DAYS
ALL DELIVERIES
% = X 100
N
1
N = NUMBER OF DELIVERIES BETWEEN -3 AND +2 DAYS
FROM CONFIRMED OR CHANGED DELIVERY DATE.
(CALCULATION IS BASED ON WORKING DAYS)
Logic:
If Purchase Order is SMI or JIT, then OTD = 1
Else
If Conf Delivery Date is NOT NULL,
If -3 <= (Received Date – Confirmed Delivery Date) <= 2
Then OTD = 1
Else
if -3 <= (Received Date – Planned Delivery Date) <= 2
Then OTD = 1
Else
OTD = 0
Document Number: FMS-QMS-4-079-00
Revision: B
flexTitle: SRS Internal Training and General Information
Document Owner: Alejandra Vargas
7
SRS Measurements
On Time Delivery % (Flex Requested Date)
Purpose: To improve On-Time Delivery which will ultimately increase manufacturing efficiency based on the receipt
transaction tables in MDSS.
Score Definition
0.00 Less than 70%
1.00 Greater than or equal to 70% and less than 80%
2.00 Greater than or equal to 80% and less than 90%
3.00 Greater than or equal to 90% and less than 95%
4.00 Greater than or equal to 95%
SN
DELIVERIES <=2 DAYS
ALL DELIVERIES
% = X 100
N = NUMBER OF DELIVERIES <=2 DAYS
(CALCULATION BASED ON WORKING DAYS)
1
Logic:
If Purchase Order is SMI or JIT, then OTD = 1
Else
If Change Delivery Date is NOT NULL,
If (Received Date - Changed Delivery Date) <= 2
Then OTD = 1
Else
If (Received Date - Planned Delivery Date) <= 2
Then OTD = 1
Else
OTD = 0
Document Number: FMS-QMS-4-079-00
Revision: B
flexTitle: SRS Internal Training and General Information
Document Owner: Alejandra Vargas
8
SRS Measurements
SMI – CRP Spend % (Supplier Managed Inventory – Continuous Replenishment Program)
Purpose: To increase SMI/JIT and CRP spend to 60% or greater, decreasing direct spend and costs associated with
logistics, as well as increasing time to line and reducing warehouse costs.
This measurement is based on the field named ‘PO Source’ and overall spend for a supplier. The percentage of SMI-CRP
spend compared to overall spend (for the specified time frame) dictates the score.
Score Definition
0.00 All less than 15%
1.00 Greater than or equal to 15% and less than 30%
2.00 Greater than or equal to 30% and less than 45%
3.00 Greater than or equal to 45% and less than 60%
4.00 Greater than or equal to 60%
S SPEND FOR PO TYPE = ((SMI + JIT)+(CRP*0.75))
TOTAL SUPPLIER SPEND% = X 100
N
1 N = No. of Suppliers w/ SMI, JIT & CRP
Logic:
Calculate spend for Purchase Order source type
((SMI+JIT) + (CRP*0.75) then divide by total spend
at supplier level.
Document Number: FMS-QMS-4-079-00
Revision: B
flexTitle: SRS Internal Training and General Information
Document Owner: Alejandra Vargas
9
Score Definition
0.00 Payment terms are less than 60 days
2.00Payment terms are equal to or greater than 60
days, but less than 80 days
3.00Payment terms are equal to or greater than 80
days, but less than 90 days
4.00Payment terms are equal to or greater than 90
days
Terms of Payment
Purpose: To increase the number of suppliers that align to Flex’s preferred payment terms.
Calculation is based on the SITE terms in the Business Partners’ table in MDSS (not the Global Terms table).
The global score is the average of site scores, however the supplier should provide the same
payment terms to all sites. If a site has less days in payment terms than other sites, it should be
escalated to the GCM.
SRS Measurements
Logic:
Using a table in MDSS that converts
all terms to a numeric value (number
of days), scores are based directly on
number of days.
Document Number: FMS-QMS-4-079-00
Revision: B
flexTitle: SRS Internal Training and General Information
Document Owner: Alejandra Vargas
10
SRS Measurements
Purchase Order (PO) Automation %
Purpose: To improve PO processing by removing manually performed steps.
This measurement is based on the receipt transaction tables in MDSS. If field named “PO_FILE_EXC_FLG “ (Purchase Order File
Exchange) is greater than zero it means that it is not manual or tactical PO.
S Purchase Order File Exchange > 0
Total Received P.O. Lines
% = X 100
N
1 N = No. of Purchase Order
File Exchange greater than 0
Logic: If Purchase Order File is greater than zero, then 1 else 0.
The total 1’s and 0’s are used to calculate the PO Automation
percentage based on total count of PO sequence (line) numbers.
Purchase Order File Exchange Value indicates how the purchase
order was communicated to the Supplier.
0 – Manual or Unknown
1 – FSP
2 – EDI
3 – EDI/FSP
SMI, JIT, CRP, and CRP-VH are treated as automatic orders.
Score Definition
0.00 All less than 20%
1.00 Greater than or equal to 20% and less than 40%
2.00 Greater than or equal to 40% and less than 70%
3.00 Greater than or equal to 70% and less than 80%
4.00 Greater than or equal to 80%
Document Number: FMS-QMS-4-079-00
Revision: B
flexTitle: SRS Internal Training and General Information
Document Owner: Alejandra Vargas
11
SRS Measurements
Quality Performance
Purpose: To provide Sites, Business Segments and the Global Team with a centralized data report related to Suppliers
Performance in terms of Quality. This measurement requires site intervention to provide the required data. The
measurements are
-- Actual DPPM (Defective Parts Per Million)
-- SCARs Initiated (within the quarter)
-- SCARs Open Time
Quality Performance data is entered or uploaded into FlexWARE Rating Quality Factor as defined in Instructions for Quality
Performance Data Uploading, FMS-QMS-4-091-00.
Logic:
Quality PI = [(PI for DPPM Level * 0.5) +
(# of SCARs Initiated * PI for SCAR * 0.5)
+ (PI for SCARs Open Time)] * 100
Score Quality PI Definition
0.00 Greater than 250
1.00 Greater than 150 AND less or equal to 250
2.00 Greater than 50 AND less or equal to 150
3.00 Greater than -50 AND less or equal to 50
4.00 Less or equal to -50
Document Number: FMS-QMS-4-079-00
Revision: B
flexTitle: SRS Internal Training and General Information
Document Owner: Alejandra Vargas
12
DPPM (Defective Parts Per Million) Level
Actual DPPM / Target DPPM
PI of DPPM Level
Corresponding Failure Rate if DPPM Target = 2000
<=1 0 <=0.2%
<=3 1 <=0.6%
<=30 3 <=6%
>30 9 >6%
1 <= Target DPPM <= 2000
Actual DPPM = Number of Defective Parts
Number of Used Parts X 1,000,000
SRS Measurements
Document Number: FMS-QMS-4-079-00
Revision: B
flexTitle: SRS Internal Training and General Information
Document Owner: Alejandra Vargas
13
SCARs Initiated
The number of SCARs initiated during the quarter due to occurrences of nonconforming product and
therefore unable to be used in production.
SCAR Open Time
Open Days
(Average SCAR Open Time)PI for SCARs Open Time
0 - 5 -0.5
6 - 21 0
≥ 22 0.5
• SCARs can be Open or Closed.
• # of SCAR: SCARs where the supplier has
confirmed the issue and committed to
corrective action.
SCAR Reason Code PI for SCAR
SCAR Incoming 1
SCAR Production 1
SCAR Customer 0KM 3
SCAR Customer Field 3
SCAR Line Stop 3
It is the number of days from when a SCAR is initiated to when a SCAR is closed.
• Only SCARS initiated during the quarter are reported. There is
no need to count the SCARs initiated in the previous quarter.
• SCAR close date: Supplier has replied to SCAR and corrective
actions are evaluated and accepted by Flex.
• If SCAR is Open, SCAR Open Time = Today – Date Sent to
Supplier.
SRS Measurements
Document Number: FMS-QMS-4-079-00
Revision: B
flexTitle: SRS Internal Training and General Information
Document Owner: Alejandra Vargas
14
SRS Measurements
Cost Reduction Program
Purpose: To increase the number of suppliers that have Cost Reduction Programs when doing business with Flex.
Based on the receipts extended price by item, commodity. If a supplier provides more than one (1) commodity, each commodity
score is weighted by total spend to obtain an overall price competitiveness rating for each supplier. Negative values in cost delta
means cost savings.
Score Definition
0.00 Cost Delta is greater than 2.0%
1.00 Cost Delta is greater than 0.5% and equal or less than 2.0%
2.00 Cost Delta is greater than -0.5% and equal or less than 0.5%
3.00 Cost Delta is greater than -3.0% and equal or less than -0.5%
4.00 Cost Delta is less or equal than -3.0%
Logic:
Weighted Average Cost (WAC) SCORE =
SUM (PO Price * Qty) / SUM (Qty) for all receipts
from the quarter..
N = No. of commodities from supplier[S1
NWAC SCOREx
SUPPLIER COMMODITY SPEND
TOTAL SUPPLIER SPEND
SCORE = ]
Document Number: FMS-QMS-4-079-00
Revision: B
flexTitle: SRS Internal Training and General Information
Document Owner: Alejandra Vargas
15
SRS Measurements
Communication Performance
Purpose: To improve the communication processes between Flex and its suppliers.
Supplier’s communicationperformance is rated with the average of the following measurements:
- Quotation Response Score
- Environmental Response Score
If any of these measures is “N/A”,
the communication score is
calculated with the average of
other available measurements.
Score Definition
0.00 Average (Quotation Score, Environmental Score, PCN score) = 0
1.00Average (Quotation Score, Environmental Score, PCN score) is greater
than or equal to 0.1 and less than 1.5
2.00Average (Quotation Score, Environmental Score, PCN score) is greater
than or equal to 1.5 and less than 2.5
3.00Average (Quotation Score, Environmental Score, PCN score) is greater
than or equal to 2.5 and less than 4
4.00 Average (Quotation Score, Environmental Score, PCN score) = 4
Document Number: FMS-QMS-4-079-00
Revision: B
flexTitle: SRS Internal Training and General Information
Document Owner: Alejandra Vargas
16
SRS Measurements
Quotation Response Time %
Purpose: To decrease the Suppliers’ Response Time to our Quotation Team (Global or Regional). Quotation Team
uses QuoteWin to process RFQs. This adds value to the customer with a quote process that is fast, responsive,
consistent and professional, as well as minimizes the costs associated with Flex’s worldwide quote operations.
Logic:
Number of On-Time Responses
divided by the Total Number of
Quoted Parts from supplier.
Score Definition
0.00 Less than 50%
1.00 Greater than or equal to 50% and less than 60%
2.00 Greater than or equal to 60% and less than 70%
3.00 Greater than or equal to 70% and less than 99%
4.00 Greater than or equal to 99%
Document Number: FMS-QMS-4-079-00
Revision: B
flexTitle: SRS Internal Training and General Information
Document Owner: Alejandra Vargas
17
SRS Measurements
Environmental Response Time %
Logic:
If the Response Date is less or equal to the Due Date
then 1, else 0.
The total 1’s and 0’s are used to calculate the
response percentage based on the total count of
MPNs or lines.
S RESPONSE DATE <= DUE DATE
ALL REQUESTED LINES
% = x 100
N
1 N = No. REQUESTED LINES
Score Definition
0.00 All less than 50%
1.00 Greater than or equal to 50% and less than 60%
2.00 Greater than or equal to 60% and less than 70%
3.00 Greater than or equal to 70% and less than 99%
4.00 Greater than or equal to 99%
Purpose: To decrease the Suppliers’ Response Time to our Environmental Team . Environmental Team uses PTC Windchill
to process environmental declarations requests.
This measurement is to ensure that the materials Flex sources and approves can meet all applicable regulations and
requirements. For more information, visit the Environmental Compliance Systems Webpage. All declaration efforts are
managed by the GBS (Global Business Services) Team via ServiceNow requests.
Document Number: FMS-QMS-4-079-00
Revision: B
flexTitle: SRS Internal Training and General Information
Document Owner: Alejandra Vargas
18
Actions Based On SRS Final Score
Final Score Status Improvement Actions to be Taken
0-0.99Poor
Suggest No-Use
Supplier must provide Improvement Plan (SIP) within 2 weeks of receipt of scores. Non-
response and/or lack of improvement may initiate SCARs and/or disqualification process.
1.0-1.99Needs
Improvement
Supplier must provide Improvement Plan (SIP) within 4 weeks of receipt of scores.
Business maybe diverted from suppliers needing improvement until improvement is made.
Non-response and/or lack of improvement may initiate SCARs.
2.0-2.99 Acceptable Supplier is performing on an average level with room for improvement.
3.0-4.0 World ClassSupplier has potential to become a preferred supplier and to receive additional quote
opportunities and/or business.
While the SRS Team is responsible for providing the SRS process,
GCMs and Site Materials personnel are responsible for working with
suppliers to improve SRS score.
See SRS Supplier Rating System Process, FMS-QMS-2-005-00,
for additional information.