Supply chain management
derailed by the merger of the two entities . The existing source was ripe for a take-over and succumbed to an offer negating the mitigation efforts of the customer .
Business Management Systems ( or ERP )
Understanding if the supplier has a fully functional , integrated business system is a good starting point . Many smaller firms operate with a combination of stand-alone systems for each functional silo . This can make them prone to key employee departure . Such non-integrated approaches often make it difficult for businesses to scale up . For vendors who have an integrated business system , understanding its age , the vendor and maintenance status is important . In either case , you want to be aware of the timing of potential system implementations or migrations . These events can often lead to lower output or actual delivery interruption .
Operations Review
Many firms skip an actual visit to the supplier ’ s site . This may be due to cost avoidance or lack of resources , but this is not a good approach . Nothing beats going to see where your goods are being produced . Seeing the layout , organization , cleanliness , and safety of production is always highly worthwhile . Key to validating what has been seen , is the collection of review of typical related certifications as may be applicable to your industry : ISO 14001 ( Environmental Management System ), OHSAS 18001 ( Health & Safety Management ), etc . For firms supplying into the defence industry , other certifications may apply such as ITAR , mentioned previously , and its equivalent in other jurisdictions . For faster movement of goods , especially into the United States , C-TPAT ( Customs Trade Partnership Against Terrorism ) of 2001 is an example of a Trusted Trader Program . Such programs facilitate customs clearance and can be worthwhile time savers in the overall lead time . These programs do invoke their own audit and checklist requirements . To maintain your own organization ’ s C-TPAT certification , you must audit your suppliers regularly for their continued compliance with the program . Both your facilities , and those of your suppliers , are subject to audit including overseas suppliers .
Quality Management
Each Quality Assurance department will have its own checklist or survey form . Some of the content of this article ’ s points are most likely to be included . Companies may want to consider consolidating checklists having different sections assigned to functional owners . The industry and products involved will heavily influence the requirements , so this can only be a summary . The key certification as a validation of a vendor ’ s responses is typically an ISO 9001 ( Quality Management Systems ) approval by a respected auditor . Other certifications could include ASME , EN and others as applicable .
Conclusion
Due Diligence is a detailed and complex effort . Such a brief article is intended to show the scope , prompt some thought , and hopefully offer ideas of a way forward . This is definitely not a “ one size fits all ” undertaking . It can be a daunting exercise , so the key is to focus in on the key topics for your most critical suppliers first . Then start working through the echelons .
About the author
Stephen Cherlet is a senior management professional with 40 years of experience . A graduate of Aerospace Engineering Technology at Ryerson ( Toronto , Canada ), he has worked in aerospace and defense for Bombardier Aerospace and Honeywell . His last role in industry was COO at Velan Inc , a wellknown valve manufacturer . Currently , Stephen is the owner / founder of FarStar S . A . C . Consulting . He is also the Chair of the National Board of Directors at Supply Chain Canada . He can be contacted at stephen @ farstarconsulting . com
56 Valve World August 2022 www . valve-world . net