The first step in building a positive relationship with your outsourcing vendor, is to clearly state your expectations in terms that are measurable and quantifiable. It is not sufficient to state to your vendor that you want "good quality plastic parts." You must quantifiably state what quality means to your company.
Vendor Management: Analyze Business Requirements
If your company is not currently focused on quality assurance, the first step is to analyze your business requirements and define how quality fits into your business. This is more of a broad view of quality, but must be done before you focus on specific quality requirements for your vendor. Quality from an enterprise point of view cannot be defined by just one person. In order to gain buy-in from all parties, a team must be formed that represents the company as a whole. Only then can the business requirements be defined and documented. Without this approach, no matter how small your company, quality will just be islands of hope within your company without a focus on the end product: satisfied customers.
- Read more: How to Analyze Business Requirements
Vendor Management: Define Quality Standards
Once quality is defined at the enterprise level, individual departments or areas will understand how they fit into the bigger picture. Now it is possible for quality to be defined at the micro level. In other words, very detailed specifications must be available for both products and services that you make internally or outsource to another company.
For example, if you are defining quality standards for a part or subassembly, the specifications can be obtained from the bill of materials, engineering drawings or manufacturing procedures. If it is a service or software, then specific business requirements must be defined. The bigger the scope of the project, the more requirements you should have.
Sample material specifications for plastic PVC pipe:
- Nom. Pipe Size (inches): 3/4 (0.375)
- Outside Diameter: 0.675 (+/- 0.01)
- Inside Diameter: 0.437 (+/- 0.005)
- Minimum Wall Thickness: 0.091
- Total Wall Tolerance: +/- 0.0008
- Maximum PSI Rating: 600
Example business requirements for an after hours answering service:
- Available 24 hours per day, 7 days per week, 365 days per year (24/7/365)
- Ability to change greeting per our request
- Caller rings through successfully 99.5% of the time
- Ability to page service technicians via cell phone or pager
- Ability to escalate calls to the supervisor on duty
Sample business requirements for a software package:
- Integrated inventory, order processing, shipping and accounting system
- Optional payroll and costing system
- Inventory part number must be a minimum of 18 characters
- Customer notes must be available for the order level and for individual order lines
- Price overrides must be approved by a supervisor
- Ability to print barcodes for detailed inventory tracking
- Inventory transaction history must be available online for a minimum of five years
Vendor Management: Site Visits
Finally, if the product, part or service is critical to the survival of your business than it is worth the investment to travel to your vendors site and see for yourself how the vendor operates. Put together an agenda of what you would want to see that would verify what the vendor told you up front. For example, if they said they have 24 hour production cycles, ask to visit the plant in the middle of the night. Look at your business requirements that you previously defined and decide which ones are most critical to you. Finally, ask them to demonstrate to you how they intend to meet your quality requirements.