Volume 7 · Issue 8 · August 2002
Contents
Transition Deadlines for ISO/TS 16949:2002
DaimlerChrysler Sets July 2004 Tier 1 Deadline
The deadline for transitioning to ISO Technical Specification
(TS) 16949:2002 has been moved up by 18 months for approximately
3,000 of the 23,000 automotive suppliers currently registered
to QS-9000:1998. Four months after ISO/TS 16949:2002 was published
and just before the release of a joint letter from the Big
Three officially stating that the TS will replace QS-9000
on December 14, 2006, DaimlerChrysler issued a letter requiring
its suppliers worldwide to transition to ISO/TS 16949:2002
by July 1, 2004.
The third largest original equipment manufacturer (OEM) in
the United States and worldwide has set an earlier transition
date than other OEMs subscribing to QS-9000 or VDA 6.1, the
German automotive quality system requirements catalog, and
this move will have a significant impact on the North American
and international automotive supply chains. "The mandate
affects all production and service parts suppliers to DaimlerChrysler,
which includes its Mercedes, Chrysler Group and Commercial
Vehicles units." explained Hank Gryn of the Auburn Hills,
MI-based Chrysler Group.
Gryn is a member of both the DaimlerChrysler, Ford Motor
Company, General Motors Corporation Supplier Quality Requirements
Task Force (SQRTF) and the International Automotive Task Force
(IATF), which are responsible for QS-9000 and ISO/TS 16949:2002,
Quality management systems—Particular requirements for
the application of ISO 9001:2000 for automotive production
and relevant service part organizations, respectively.
At present, suppliers to DaimlerChrysler’s Mercedes
operations based in Stuttgart, Germany, must be registered
to VDA 6.1 or ISO/TS 16949, while suppliers to its Chrysler
Group operations based in Auburn Hills, MI, must be registered
to QS-9000:1998 or ISO/TS 16949. The Commercial Vehicles units
vary as to which registration scheme each requires. However,
Gryn told THE OUTLOOK that the DaimlerChrysler decision to
set an earlier deadline than other OEMs subscribing to QS-9000
or VDA 6.1 was not driven by a need to transition suppliers
to the TS by July 2004.
"VDA 6.1 doesn’t really have an expiration date,"
commented Gryn. "The real reason transitioning all of
DaimlerChrysler’s suppliers to ISO/TS 16949:2002 registration
sooner works out for us is that we will then have all our
suppliers using one system worldwide. We are one company,
and having our entire supply chain adhering to one set of
quality management system requirements will benefit our company.
"It’s more than just the value of the TS, it is
also the value of the associated registration scheme. With
the introduction of ISO/TS 16949:2002, the automotive OEMs
have also introduced tighter controls on the registration
process itself. Now, accredited registrars that have been
qualified to conduct registration assessments to the TS will
be evaluated and closely monitored by the ISO/TS 16949 oversight
organizations, such as the International Automotive Oversight
Bureau [IAOB], which will improve the registration process."
Gryn also remarked that DaimlerChrysler anticipated improvements
in the auditing and management of supplier quality management
systems (QMSs) with ISO/TS 16949:2002. "The auditor training
and examinations involved with being qualified by the IAOB
and other oversight organizations will ensure better capability
of registrar auditors. Plus, ISO/TS 16949:2002 itself has
a natural flow that is more in line with the way an automotive
business is run, thanks in part to the ISO 9001:2000 process
approach structure. The process approach is the only way to
audit an organization and its management system. What’s
more, senior management now has to be involved and they have
to be audited. You can’t miss them in an audit for ISO/TS
16949:2002."
The letter was issued in late July 2002 and was signed by
Auburn Hills, MI-based Gary C. Valade, who is Executive Vice
President of Global Procurement and Supply for DaimlerChrysler,
AG. The mandate means that Chrysler Group suppliers have slightly
less than 2 years to make the transition to ISO/TS 16949:2002.
A copy of the letter is reprinted in THE INFORMED OUTLOOK
Newsletter, August 2002. Gryn estimated that approximately
3,000 suppliers to the Chrysler Group are registered to QS-9000
and will need to make the transition.
Gryn noted that DaimlerChrysler is tracking on a scheduled
basis how many of its suppliers are registered to the TS,
which involves identifying its suppliers in the ISO/TS 16949
registration database maintained by the IAOB.
"The minute the announcement [of the transition deadline]
came up, I started receiving certificates to ISO/TS 16949.
So, we know that some were prepared well in advance."
What Are the Other Big Three OEMs Doing?
As noted, the DaimlerChrysler announcement issued July 29,
2002, preceded a letter from the SQRTF issued in early August
2002 that states officially that ISO/TS 16949:2002 will replace
QS-9000:1998 when it expires on December 14, 2006. The letter
strongly urges suppliers registered to QS-9000 to upgrade
their "registered site(s)…to ISO/TS 16949:2002 at
the expiration of their current QS-9000 certification, and
no later than 14 December, 2006, or earlier based on individual
OEM requirements." The full text of the letter is reprinted
in THE INFORMED OUTLOOK Newsletter, August 2002.
The letter is important because it verifies for the first
time in writing that the Big Three intend to replace QS-9000
with ISO/TS 16949 and sets a definite end point for transitioning
to an ISO 9001:2000-based specification. However, it also
raised the possibility that Ford and GM would set earlier
deadlines than December 2006.
In fact, some registrars and suppliers were not surprised
by the mandate, only by the fact that it was limited to DaimlerChrysler.
"The announcement was expected by our organization and
some of our automotive clients, but it was expected to be
a joint announcement from the Big Three," commented Bill
Sullivan, Marketing Manager of DNV Certification. "The
fact that there was not a joint announcement would tend to
indicate that there was not consensus among the Big Three
on implementation timelines."
In attempting to verify the intentions of the other Big Three
members, THE OUTLOOK learned from Russ Hopkins, who
represents Ford on the SQRTF and IATF, that Ford plans to
let its production and service part suppliers transition their
QS-9000 registrations to ISO/TS 16949 between now and December
14, 2006.
"Ford has published the joint letter stating that transitioning
to ISO/TS 16949:2002 is strongly recommended at the expiration
of the supplier’s current registration," affirmed
Hopkins. "Otherwise, the requirement is ISO/TS 16949
registration by December 14, 2006."
Hopkins acknowledged that the reason the joint letter is
recommending that suppliers make the transition to ISO/TS
16949:2002 at their next QS-9000 certificate renewals is because
it might save the suppliers money, since they will require
a more extensive registrar assessment at the certificate renewal
anyway, and it will stagger the rollout of ISO/TS 16949:2002
among Tier 1 automotive suppliers.
Ford is not yet tracking on a scheduled basis how many of
its suppliers have made the transition and has no targeted
plan for when certain numbers of suppliers should be transitioned.
"But we do strongly advise against waiting until the
last minute," stressed Hopkins.
GM had not responded by press time to an inquiry regarding
whether it is considering an earlier deadline, although it
is expected to also give suppliers until December 2006 since
it has the largest number of suppliers needing to make the
transition.
Joseph Bransky, who represents GM on the SQRTF and IATF,
has previously pointed out that the SQRTF made arrangements
that would permit continued use of the verbatim text of ISO
9001:1994 within QS-9000:1998. The reason was to extend the
registration life of QS-9000 until 2006 in order to avoid
a bottleneck of QS-9000-registered organizations rushing to
transition after release of ISO/TS 16949:2002 in March 2002.
Hopkins also told THE OUTLOOK that Ford’s customer-specific
requirements for ISO/TS 16949:2002 "were out for internal
review in late July, with an August 2002 publication target."
It is expected that Ford will require use of the 5 reference
manuals that are noted or specified in QS-9000. Hopkins offered
the following advice to all suppliers: "Do not wait until
the last minute, but prepare well. This is not an element-by-element
compliance effort any more."
What Does the Mandate Mean to Suppliers?
The announcement by DaimlerChrysler of a deadline has probably
raised three key questions at many suppliers to the Chrysler
Group and beyond:
- How much time and effort will the transition take our
organization?
- Are the customer-specific requirements different from
those in QS-9000?
- What must we ensure our suppliers do so that we are in
conformance with the TS?
As for Question 1, the expectation is that any supplier registered
to QS-9000:1998 and meeting the customer-specific requirements
of their OEM customers will not require a great deal of time
or effort to make the transition. "It really takes about
6 months to transition," replied Gryn, who nevertheless
advised production and service part supplier to get their
QMSs up and running as soon as possible. "They can make
the actual registration transition at their next surveillance
audit. That would be the way to do it."
In fact, Gryn viewed a QMS conforming to ISO/TS 16949:2002
as a change that will make managing the system easier for
most organizations. "The change is not that great, with
adjusting the system to follow the process approach being
the big difference. In truth, the new system should be much
simpler for an automotive supplier because its managers and
personnel already know their own business. They should write
down what they do and do what they write down and then follow
their plan.
"With ISO/TS 16949:2002, the auditors will be checking
more for how well the company is complying to OEM company-specific
requirements and how it manufactures its product. That’s
because the QMS now starts from marketing and ends with after-sales
contacts with the customer."
This is not just the viewpoint of the customer. "Those
organizations that are registered to QS-9000 and ISO 9001/2:1994
are substantially compliant with the requirements of ISO/TS
16949:2002," confirmed Sullivan, based on DNV’s
assessments so far of clients transitioning from QS-9000.
"Those that have been registered to ISO 9001:2000 are
almost there."
As for Question 2, the Chrysler Group has completed its customer-specific
requirements for ISO/TS 16949:2002 and posted them on several
web sites. According to Gryn, the customer-specific requirements
were posted in early August 2002 on the EEN, which is the
web site the Chrysler Group maintains for its suppliers. In
addition, the requirements have been provided to AIAG, which
was expected to post them on its web site (www.aiag.org) by
mid-August 2002. They will also be available on the IAOB web
site (www.iaob.org), where the DaimlerChrysler company-specific
requirements for ISO/TS 16949:1999 were still accessible at
press time but not those for the 2002 edition.
"Among the big changes from QS-9000, our company-specific
requirements now specifically refer to the 5 reference manuals
mentioned directly in QS-9000 but not in the TS," said
Gryn. "They are reference manuals and they don’t
change, so this actually does not involve a change from what
a QS-9000-registered supplier would need to do. In addition,
a few things have been adjusted since the third edition of
QS-9000 because of the changes within the corporation—for
instance, different phone numbers." In effect, the company-specific
requirements represent updating of information since QS-9000
was last revised in 1998 but not new requirements.
However, each unit of DaimlerChrysler will be maintaining
separate company-specific requirements that reflect the previous
requirements of each unit and the requirements in QS-9000
or VDA 6.1. "Each division has its own way of doing things,
so check the individual web sites of your customers, even
if they are all DaimlerChrysler."
As far as Question 3 is concerned, ISO/TS 16949:2002 registration
by a Tier 1 supplier means that its suppliers will need to
be registered to ISO 9001:2000, Quality management systems—Requirements,
after December 15, 2003, in order for the Tier 1 to obtain/maintain
registration to ISO/TS 16949:2002. This is a requirement in
7.4.1.2, Supplier Quality Management System Development, which
states:
Unless otherwise specified by the customer, suppliers
to the organization shall be third party registered to ISO
9001:2000 by an accredited third-party certification body.
"For a supplier to get registered to ISO/TS 16949:2002
by 2004, it will need to make sure all its suppliers are registered
to ISO 9001:2000 and are pursuing TS compliance," emphasized
Gryn. "If any of its critical-to-quality suppliers fails
to obtain ISO 9001:2000 registration, the registrar cannot
issue an ISO/TS 16949:2002 certificate or must withdraw an
existing certificate. However, we are reasonable. We are not
trying to make this financially cumbersome for the supply
chain. So, if our supplier has a mom-and-pop shop as its supplier
and it is impractical to make the shop get registered, we
will make alternate arrangements."
Gryn indicated that there are no plans to establish procedures
that would enable Tier 1 suppliers to waive the requirement
for supplier registration to ISO 9001:2000 in favor of an
approved second-party auditing approach for subcontractors.
"We have not specified anything different in terms of
second-party audits by our suppliers of their suppliers. ISO
9001:2000 registration and pursuit of TS conformance among
our suppliers’ suppliers remains the acceptable approach
to demonstrate supplier development and supplier conformance."
"For Tier 1 suppliers to DaimlerChrysler, it is a clear
mandate," admitted Sullivan, who added, "For other
QS-9000 suppliers and subcontractors, it may accelerate their
transition to ISO 9001:2000 as an interim step to compliance
with ISO/TS 16949:2002." Sullivan also indicated that
he expected the TS-qualified registrars to have adequate time
to plan and have the audit resources available to meet demand
for ISO/TS 16949:2002 transitioning. "And, even though
this is a ‘system’ registration, the ultimate benefit
should be a better quality product."
Gryn concluded by offering the following warning: "I
would like to tell the supply chain that, if the third-party
registration system does not function effectively, it will
go away and we will go to something else. Something else is
what certain other OEMs are doing now—a lot of second-party
audits. It will be customer audits and will involve separate
audits from each customer. It would be unfortunate for the
third-party system to fail and for us to move in the opposite
direction."
THE OUTLOOK will provide continuing coverage of developments
involving ISO/TS 16949:2002 and its use within the supply
chain.
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