Supplier Rating - A Total Quality Approach

Article

Kirsanoff, William A.   (1990, ASQC)   Rockwell International Corp., Anaheim, CA

Annual Quality Congress, San Francisco, CA    Vol. 44    No. 0
QICID: 9587    May 1990    pp. 1030-1035
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Article Abstract

In April of 1986, Rockwell International, Autonetics Electronics Systems in Ariaheim, California, implemented their "Supplier Rating and Incentive Program" (SRIP). This paper will explore the history of the program, how it works, and the result of the program's implementation. The program was the first in the aerospace industry to successfully include supplier quality performance and delivery performance in a single rating, dollarized to reflect the cost of non-quality. Administered jointly by Quality Assurance and the Material Department, the program is considered a model for industry, with applications for commercial and military contractors. Since its implementation, the program has initiated supplier performance improvements resulting in cost-avoidance savings of several million dollars. The program has created an improved quality consciousness in suppliers. Buyers have embraced the program as a method to quantify what they have always known instinctively: the lowest price bid is not always the lowest cost bid. Communication between buyer and seller has been greatly improved. Supplier problems are identified quickly and can be solved in the early stages.

Keywords

Customer supplier relationships,Cost of quality (COQ),Case study


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