Case for Change

Participant Guide A Case for Change

Revision 2006-01©2001, 2006 Ford Motor Company

A Case for Change

Corporate QualityDevelopment Center

Participant Guide



The subject matter contained herein is covered by a copyright owned by:FORD MOTOR COMPANY

CORPORATE QUALITY DEVELOPMENT CENTERDEARBORN, MI

© 2001, 2006 Ford Motor Company

This document contains information that may be proprietary. The contents of this document may not be duplicated by any means

without the prior written permission of Ford Motor Company.



Corporate Quality Development Center

©2001,2006 Ford Motor Company

A Case For Change

Why are we here?

•STA Engineers are one of the key direct links between Ford and our suppliers.

•We have suppliers and STA Engineers all over the world.

•To be most effective, we must have common methods, policies and procedures worldwide.

•Treat each and every supplier in the same equitable manner.

•Hold each and every supplier to the same high quality standard.

1



Introduction

What Is Quality?

R e c o r d y o u r d e f in i t i o n o f q u a l i t y o n th e l in e s b e lo w .

Quality Brainstorming

Record additional thoughts about the nature of quality in the space provided below:

2




A Case for Change

Why CQDC?

As STA Engineers, we need a global standard skill set to be effective.

CQDC is a rigorous, technically focused, global curriculum that provides the tools

needed to successfully improve our supplier quality, which will help improve our

customer satisfaction.

Topics Introduced in this lesson:

• Changing Expectations

• Relationships

• Teamwork

• The Ford System

• Action Plan

3




A Case for Change

Objectives

– Explain vividly the customer satisfaction and quality crisis facing Ford Motor Company

– Explain the expectations of STA in addressing this crisis

– Describe the working relationship necessary within Purchasing and Ford to meet Purchasing objectives

– Describe the Supplier relationship values and rules of conduct

4




A Case for Change

Supplier Relationship Values

• Act like a partner to be a partner• Trust and be trustworthy• Communicate with consistency• Be fact based• Think value, not just price

Become the Original Equipment Manufacturer (OEM) of choice!

The Ford Supplier Relationship values listed above are key to developing and maintaining strong working relationships with our suppliers. We need to become the “customer of choice” for our suppliers.

In order to “live” these values, it may be necessary to change old attitudes and behaviors. The best way to do this is to become the example – model these behaviors, and lead by example.

Lasting change does not happen overnight – it requires time, effort, great communication and a willingness to change.

Ways to exemplify these values:• Be a champion for customer satisfaction.• Be assertive but fair.• Make decisions based on data.• Get it right the first time.

We need to be the OEM of choice – it’s the right thing to do, and it will help us procure the best innovations, resources, technology, and people for Ford Motor Company.

5




A Case for Change

Who do we interact with?

• Suppliers• Purchasing• Manufacturing• Engineering

To be effective, we need to have strong positive working relationships with many different groups – primarily, suppliers, purchasing, manufacturing, and engineering. We all have a shared responsibility for the ultimate quality of our products.

The next few slides spell out the roles of each of these groups.

6




A Case for Change

Purchasing Responsibilities

• Identify suppliers who deliver the required product development capability

• Ensure technical resources are available to close deficiency gaps

• Verify supplier quality capabilities and utilize a metrics-driven assessment

• Facilitating a cross-functional sourcing consensus

• Issue target agreements

• Develop forward-model-sourcing strategies

• Ensure supplier responsiveness

• Drive adherence to the Purchasing Supplier Relationship Values

• Involve STA early in the sourcing process

7




A Case for Change

Supplier Responsibilities

• Deliver the right product, at the right time, in the right quantity

• Meet the technical, financial, and process capability objectives

• Staff the program with sufficient resources

• Complete product assurance and timing plans

• Challenge seemingly redundant Ford requirements

8




A Case for Change

Engineering Responsibilities

• Provide customer requirements, program scope, and quality and reliability objectives

• Provide clarification on proposed direction

• Establish a product assurance management process

• Monitor and manage supplier execution

• Participate actively in supplier technical and process capability reviews

• Lead regular and periodic risk assessments

• Lead problem resolution and continuous improvement efforts

When providing clarification on proposed direction, Engineering should include:

• Trade-off decisions

• Quality objectives

• Expected deliverables

• Design standards

• Design FMEA

• PPAP and PSW requirements

• System interface requirements

9




A Case for Change

Manufacturing Responsibilities

• Participate in sourcing decisions, based on quality history and total cost

• Provide shipping requirements, shipment windows, and packaging requirements

• Monitor supplier quality deficiencies and communicate them to the suppliers and STA/Purchasing

• Maintain historical data on supplier’s quality and shipping performance

• Participate in quality reviews at the supplier sites

• Conduct quality reviews of selected suppliers at Ford Manufacturing Plants

• Provide technical/manufacturing knowledge and assistance to suppliers that have major quality/productivity issues

10




A Case for Change

STA Engineer and Purchasing Shared Responsibilities

• Achieve common understanding of supply base

• Recognize areas of concern

• Understand which suppliers are doing it right

• Work together to source new business

• Deal with ongoing performance issues

From time to time, conflicting objectives may arise with the STA Engineer’s focus on quality and Purchasing’s focus on cost. This does not mean that Purchasing is not concerned about quality. Both parties must commit to finding the optimal cost-quality solution.

We both need to understand which suppliers perform well regarding speed, cost, quality, etc. We must maintain an equally collaborative relationship to be effective.

The joint responsibilities of the STA Engineers and Purchasing include:

•Work together to source new business, which includes discussing the following questions:•What programs are going to be sourced?•Who are the candidates?•Who is capable of doing what is required from a manufacturing perspective?

•Work together to deal with ongoing supplier performance issues, including identifying and agreeing upon a strategy to address problems and protect Ford Motor Company’s interests

Tips for Maintaining a Good STA Engineer/Purchasing Working Relationship•Maintain open communication and ongoing dialog - this means keeping each other in the loop on a regular basis•Visit supplier plants together from time to time - this helps both parties remain informed•Complete a trip report to update Purchasing and other STA Engineers about events and occurrences during site visits•Maintain one point of contact — to protect the supplier from having too many contacts

11




A Case for Change

Resources

Global Purchasing homepagehttp://my.purchasing.ford.com/

STA homepagehttp://www.purchasing.ford.com/prch_quality_hp/

12

1Revised June 2006

©2006 Ford Motor Company

� ��

��

IntroductionWelcome to Communication Skills, part of the Corporate Quality Development Center (CQDC) curriculum. This course will teach communication, meeting, and facilitation skills.

How This Course Relates to Other CoursesThis course is taught in relationship with the other curriculum courses.

Regionally speakingAs Ford Motor Company has expanded globally we need to understand the importance of regional and cultural differences in the workplace. Please keep in mind that the CQDC courses were originally written, and are based primarily from a North American’s perspective. The intent of CQDC is to educate and communicate Ford’s standard policies and processes.

Here are some examples are of cultural difference:

•Acknowledging that some regions are individually based, or team based

•The tone, speed, or inflection in our voice levels need to be considered when teaching these courses.

•Quick decisions and short-term thinking is not respected in some cultures

2Revised June 2006


Communication Skills

� ��

��

This course focuses on communication tools and

meeting facilitation skills for Supplier Technical Assistance

(STA) Engineers.

PurposeThis course focuses on communication tools and meeting facilitation skills for Supplier Technical Assistance (STA) engineers.

3Revised June 2006



� ��

��

� To provide STA Engineers with communication and meeting �Tools�Skills�Resources

� To assist STA Engineers in being influential leaders that: �Drive decisions�Effectively report out information�Ask appropriate questions of Suppliers�Lead to improved communication�Produce higher quality output

GoalTo provide STA Engineers with communication and meeting

•Tools

•Skills

•Resources

To assist STA Engineers in being influential leaders that:

•Drive decisions

•Effectively report out information

•Ask appropriate questions of Suppliers

•Lead to improved communication

•Produce higher quality output

4Revised June 2006



� ��

��

Upon completion of this course, participants will be able to:

� Define “Advocate for Quality”� Distinguish the difference between

assertive and aggressive behavior� Demonstrate assertive behavior� Ask probing, strategic questions� Plan and facilitate meetings

ObjectivesUpon completion of this course, participants will be able to:

•Define “Advocate for Quality”

•Distinguish the difference between the four behavior styles

•Demonstrate assertive behavior.

•Ask probing, strategic questions

•Plan and facilitate meetings

5Revised June 2006



� ��

�!��!�"��!��#��

An Advocate for Quality:

• Employs quality tools to make fact-based decisions to support the quality objectives of our customers

• Acts as the voice of reason

• Champions the right choices to improve the quality of parts and the speed at which they are manufactured and shipped to the plants

• Fosters an environment of continuous improvement that results inrobust processes and procedures that will meet or exceed the expectations of our customers

• Champions the development of measures to track the organizational benefits of process improvements

• Supports efforts to optimize total costs

Communication SkillsWhat Is an “Advocate for Quality?”An advocate for quality:

•Employs quality tools to make fact-based decisions to support the quality objectives of our customers

•Acts as the voice of reason

•Champions the right choices to improve the quality of parts and the speed at which they are manufactured and shipped to the plants

•Fosters an environment of continuous improvement that results in robust processes and procedures that will meet or exceed the expectations of our customers

•Champions the development of measures to track the organizational benefits of process improvements

•Supports efforts to optimize total costs

What Is the Formula for Successful Change?SC = f(L,V,N,M1,M2,R,C)

(Leader, Vision, Clear Need, Measure, Means, Resources, Communications)

6Revised June 2006



� ��

��$�%��

�Aggressive�Covert aggressive�Non-assertive�Assertive

Four Communication Behavior StylesWe use four different communication behaviors styles in our daily communication. All of these behaviors are learned. No one is born with a particular communication behavior. The four behaviors are:

• Aggressive

• Non-assertive

• Covert aggressive

• Assertive

7Revised June 2006



� ��

�� !��

$�%��

AggressiveActively and directly standing up for the rights of self, while ignoring therights of others. Aggressive communication behavior is HOSTILE.

Covert AggressiveIndirectly standing up for the rights of self, while ignoring the rights of others. Covert aggressive communication behavior is MANIPULATIVE.

Non-AssertiveDenying the rights of self to respect the rights of others. Non-assertive communicationbehavior is WEAK.

AssertiveActively and directly standing up for the rights of self, while respecting the rights of others.Assertive communication behavior is STRONG.

How do we manifest these communication behavior styles? What do we say? What do we do?

8Revised June 2006



� ��

�� $�%��%��

��

��

��

��

��

� ��

��

��- ��

��

!��

"� ��

#��

��-��

��

$��

$��$��

$��$��

��$%��

��

&�'��

��%��

(��

��'� ��

��

)��

��'�

*�� +

*, �� +

��-��

��

��

,��

)��

)��

��

� ��

&�� % ��

, ��

��

"�� -� ��

��'�

. ��

��

)��

&��

��- ��

��

��

(� ��

&��

��

/��'�� '��

,��

$%��

$%��

��

��

�� 0��

#��

1��'-��

*.��+

��-��

��

�� -��

��

$��

� ��

/��

/��'��

/�� % � ' ��

,��'�� '�

$%��

AGRESSIVEAGRESSIVE

NON NON ASSERTIVEASSERTIVE

COVERT COVERT AGGRESSIVEAGGRESSIVE

ASSERTIVEASSERTIVE

VERBAL NON VERBAL APPROACH

9Revised June 2006



� ��

��& ��%��"��

$�%��

�Direct�Persuade�Bridge�Avoid

Summary of Communication Behavior StylesStyles within Assertive BehaviorDirect — Have right to ask directly (i.e., when there is a fly in your soup, you have the right to ask for more soup).

Persuade — List reasons that prove your assertion (business case, i.e. “you should be able to do this because of a, b, c, etc.”).

Bridge — Pulling together. Use when you do not have authority or when buy-in is important. Help to discover by asking questions.

Avoid — When emotions are too intense, leave the situation and come back when calmer.

10Revised June 2006



� ��

"�� '��

�Paraphrasing�Asking strategic open questions�Reflecting feelings�Using “I” statements

Assertive Communication ToolsCommunication tools that can assist an STA Engineer in effective problem solving:

• Paraphrasing

• Asking strategic open questions

• Reflecting feelings

• Using “I” statements

11Revised June 2006



� ��

��%��(� �!��

Paraphrasing is a brief restating of the information given in the listener's own

words. It is a statement of facts, information, or ideas. It should not

include opinions or judgments about what is being said.

Assertive Communication Tools, continuedParaphrasingParaphrasing is a brief restating of the information given in the listener’s own words. It is a statement of facts, information, or ideas. Paraphrasing should not include opinions or judgments about what the person said.

12Revised June 2006



� ��

��%��(�$��!��

Paraphrasing accomplishes the following:� Assures the speaker that you are listening and trying to

understand� Ensures that your interpretation of the message is correct� Encourages the speaker to continue� Verifies understanding� Demonstrates listening� Acknowledges speaker� Reinforces speaker's point� Provides processing time for listener� Helps the speaker be clear and focused

Benefits of ParaphrasingParaphrasing accomplishes the following things:

•Ensures that your interpretation of the message is correct

•Encourages the speaker to continue

•Verifies understanding

•Demonstrates listening

•Acknowledges speaker

•Reinforces speaker’s point

•Provides processing time for listener

•Helps the speaker be clear and focused

Examples of Paraphrasing“So you’re saying we shouldn’t be concerned about the process.”

“As I understand it, you want us to verify the results before acting.”

“Let’s see if I have this right. You want us to...”

“Sounds like you’re saying that you are ready to change the...”

13Revised June 2006



� ��

'��!�#��

• Closed — Begins with such words as “Do,”“Did,” “Can,” “Will”, and “Is,” which result in “yes” or “no” answers. While they have their place in our communications, they do not open up the other person’s thinking.

• Serial — Two or more questions in a row can cause the receiver to become confused and/or fail to answer every question.

• Defensive — Begins with “Why” and results in receiver feeling attacked and becoming defensive.

Assertive Communication Tools, continuedIneffective Questions — Use with CautionClosed — Begins with such words as “Do,” “Did,” “Can,” “Will,” and “Is.” Closed questions can yield “yes” or “no” answers. While they have their place in our communications, they do not open up or focus the other person’s thinking.

Serial — Two or more questions in a row. Serial questions can cause the receiver to become confused and/or fail to answer every question.

Defensive — Begins with “Why.” Defensive questions result in the receiver feeling attacked and becoming defensive.

14Revised June 2006



� ��

��(��#��

Open questions provide the opportunity to gain more information. Open questions cannot be answered with a “yes” or “no.”They do not limit the speaker in choosing what information with which to respond.

Open questions typically begin with “What” or “How.”

Strategic Open QuestionsStrategic open questions are well thought and well designed, thus “opening up” the opportunity to gain more information. Strategic open questions cannot be answered with a “yes” or “no.” They cause the other person to focus on the question, think before responding, and take responsibility for problem solving. Open questions typically begin with “What” or “How.”

15Revised June 2006



� ��

$��!��!��(��

#��

• Keeps the focus on the speaker• Helps expand or develop ideas• ��!��%��!��%��!��%��!��%��!�� !�� !�� !��

• Demonstrates listener interest• Shows respect for speaker’s ideas• )��)��)��)�� *��*��*��*� ��

• Helps listener avoid advising

Benefits of Asking Open Questions•Keeps the focus on the speaker

•Helps expand or develop ideas

•Opens up further information

•Demonstrates listener interest

•Shows respect for speaker’s ideas

•Helps speaker solve own problems

•Helps listener avoid advising

Examples of Open Questions“How do you plan to reduce the cost?”

“What approaches have you tried to improve quality?”

“What prevented you from getting the 8D done in time?”

TIP: Try to find a balance in asking both fact-finding and feeling-finding questions.

16Revised June 2006



� ��

�� !��(��

#��

• “What do you think?”• “How would you like to handle it?”• “What approaches have you

tried?”• “How do you feel about that?”

Strategic Open QuestionsExercise 1In groups, change the following sentences into strategic open questions.

Questions“Why didn’t you turn in the 8-D on time?”

“Do you think this method will work?”

“Why can’t you meet this quality standard?”

“Why didn’t you call me?”

17Revised June 2006



� ��

+�!��(��(��

Reflecting feeling is recognizing the emotion expressed by the speaker and

putting it into words. It acknowledges the speaker's message. Reflecting feeling

requires the listener to identify the speaker's emotion, and to respond to the

speaker by naming the feeling heard.

Reflecting FeelingsReflecting feeling is recognizing the emotion expressed by the speaker and putting it into words. Reflecting Feelings acknowledge the speaker’s message. Reflecting feelings requires the listener to identify the speaker’s emotion, and to respond to the speaker by naming the feeling heard.

Benefits of Reflecting FeelingsDemonstrates listening

Verifies understanding

Acknowledges speaker

Shows empathy

Helps speaker vent

Defuses emotion

Facilitates problem solving

Examples of Reflecting Feelings“You sound very concerned about not being able to meet the standard.”

“It is frustrating when deadlines need to change.”

“You must be very proud about achieving that Supplier Award.”

18Revised June 2006



� ��

$��!��!�+�!��(��(��

• Demonstrates listening• Verifies understanding• Acknowledges speaker• �%�*�� %��%�*�� %��%�*�� %��%�*�� %�

• )��)��)��)��

• �!�� !�� !�� !��

• Facilitates problem solving

Reflecting Feelings, continuedExercise 2Demonstrate skills in identifying Reflecting Feelings to achieve empathetic listening.

ProcessSupplier starts a story with an opening statement that denotes a strong emotion. (Do not name the feeling!) The STA Engineer responds to the Supplier by acknowledging the feeling expressed. Supplier validates the accuracy of the feeling reflected. Repeat the process.

RolesSupplier: Start a story about an incident you feel strongly about. Some examples are about an unrealistic deadline, a difficult requirement, an additional request, or a problem completing a project.

STA Engineer: Respond to the Supplier by reflecting the feeling you sensed the Supplier expressed. Do not ask about the information, just acknowledge the feeling and paraphrase what the person said.

Observer: Keep time, allowing no more than one minute per example. Call “foul” if the STA Engineer asks questions or makes comments about the information. “Applaud” if the STA Engineer acknowledges the feeling and paraphrases.

Tip: Do not make the Supplier tell the whole story before you reflect the feeling you hear. If you are wrong about the feeling expressed, try again.

19Revised June 2006



� ��

,��(�-./ ��

This is an effective model for simple assertions. The purpose is to provide

clear, direct, and straightforward information to a person without

automatically antagonizing or alienating that person. The model is designed to stand up for personal rights without

infringing on another’s rights.

Using “I” StatementsThis is an effective model for simple assertions. The purpose is to provide clear, direct, and straightforward information to a person without automatically antagonizing or alienating that person. The model is designed to stand up for personal rights without infringing on another’s rights. It includes three essential ingredients:

1. Ownership of feeling or impact: “I feel__________________

2. Description of behavior or event: about/when _____________

3. Explanation of cause or reason: because ________________ .”

20Revised June 2006



� ��

'%��'%��.�(��!�-./

��

Ownership of feeling or impact:“I feel ________________________

Description of behavior or event: about/when ___________________

Explanation of cause or reason: because _____________________.”

Examples“I get upset when you tell me one thing and do another because it causes me not to trust your word.”

“I am happy to see you were able to meet the quality standard because it really helped Ford Motor Company.”

“When deliveries are not made on time, I get really concerned because it throws off the schedule and I start getting calls from the plant.”

“I feel proud about the work we did because we all pulled together to accomplish the impossible.”

“When I’m interrupted while I’m talking, I get angry because I am unable to finish making my point.”

21Revised June 2006



� ��

,��(�-./ �� '��

"You" Statements "I" Statements You make me angry. I’m angry about the deadline not being met.

You messed this up. I’m upset that the job wasn’t completed because we spent a lot of time going over this.

You are always late turning in these reports. I worry when the reports don’t come in on time because we won’t meet our deadlines.

22Revised June 2006



� ��

�� (��

Establish what the meeting should produce, and whether a meeting is

even necessary to produce the needed results.

Meeting SkillsFacilitating Meetings

Determining the Desired OutcomeGet clarity on the purpose of the meeting and establish what results the

meeting should produce.

23Revised June 2006



� ��

��0��

After determining the purpose, decide on the following:• Where will the meeting take place?• When will the meeting take place?• How long will the meeting last? • What equipment is needed?• Who will be invited?• Who will facilitate?• Who else needs to speak or give a presentation?

Plan EarlyAfter determining the purpose, decide on the following:

Where will the meeting take place?

When will the meeting take place?

How long will the meeting last?

What equipment is needed?

Who will be invited?

Who will facilitate?

Who else needs to speak or give a presentation?

24Revised June 2006



� ��

��(��"(��

An agenda outlines the meeting and helps keep it on track.

Facilitating Meetings

Creating an AgendaAn agenda outlines the meeting and helps keep it on track.

Agenda Do’s and Don’ts:Do keep the agenda flexible to allow for thorough discussion.

Do make the agenda as specific as possible.

Do keep the meeting to one hour if possible.

Distribute agenda at least 24 hours before the meeting, but no longer then a week in advance.

Put the agenda on a flip chart so all attendees can view it.

Do not try to do too much in one meeting.

Do provide for breaks.

25Revised June 2006



� ��

0��%��(��+��

• Discussions at a meeting can fall apart and become unproductive. Some ground rules should be established at meetings to ensure that they run smoothly.

• Ideally, the members of a group can establish their own ground rules. This helps achieve buy-in from all participants.

Creating Ground RulesDiscussions at a meeting can fall apart and become unproductive. Some ground rules should be established to ensure meetings run smoothly.

Ideally, the members of a group can establish their own ground rules. This helps achieve buy-in from all participants.

26Revised June 2006



� ��

01� ��!��+��

� Accept all responses.� Do not evaluate others’ comments. � Assure people they can stay silent if

they don’t have a contribution right away.

� Do not interrupt.� Stay focused on the issue, not the

person.

Ground Rules for Effective DiscussionsA committed STA Engineer that wants to be an effective facilitator of a problem-solving meeting will:

Accept all responses.• Avoid excluding or isolating anyone.• Capture each person’s ideas on a flip chart• Post unrelated or tangential ideas on separate flip chart

(parking lot).Do not evaluate others’ comments.

• Avoid saying “That’s a great idea”! or “That won’t work!”because it can stifle creativity.

• Use a simple “thank you.”Assure people that they can stay silent if they do not have a contribution right away.

• Encourage without pushing anyone to speak.Do not interrupt.

• Do not allow interruptions.Stay focused on the issue, not the person.

• Avoid personal attacks if you or others disagree with the speaker.

• Assure group members that disagreement is OK.

27Revised June 2006



� ��

"��

A simple action plan will help avoid confusion after the meeting, and serve as a reminder to those that have taken on tasks.An action plan should include:

• Who• Does what• By when

Create an Action PlanA simple action plan will help avoid confusion after the meeting, and serve as a reminder to those that have taken on tasks.An action plan should include:

•Who•Does what•By when

Do not assign action items to people who are not present. Assign someone at the meeting to contact that person about carrying out the action.

ACTION PLAN

Task Person Assigned Completion Date

1._____________________________________________________________________________________2._____________________________________________________________________________________3._____________________________________________________________________________________4._____________________________________________________________________________________

28Revised June 2006



� ��

+��"��

• The class will be divided into teams composed of five members each.

• Each member will be assigned a role and given a description to read.

• The STA Engineer in each team will function as meeting facilitator.

• The goal of the role play is to use communication tools and meeting skills to identify solutions.

• After teams have completed their meeting, the teams will report their solutions and how they arrived at the solutions.

SummaryRole Play — Meeting Scenario PracticeActivity GoalTo use the assertive communications style, assertive communication tools, and meeting skills while facilitating a problem-solving meeting.

InstructionsThe class will divide into teams composed of five members each.

Each member will be assigned a role and given a description to read. DO NOT SHARE YOUR ROLE OR READ A ROLE OTHER THAN YOUR OWN.

The STA Engineer in each team will function as meeting facilitator.

The goal of the role play is to use assertive communication tools and behaviors while using meeting skills to identify solutions.

After teams have completed their meeting, each team will report its solutions and how the members arrived at these solutions.

Revision 2006-01©2006 Ford Motor Company


The STA JobParticipant Guide




Copyright © 2001-2006 Ford Motor CompanyThis document contains information that may be proprietary. The contents of this document may not be duplicated by any means without the written permission of

Ford Motor Company.

All rights reserved.



The STA Job

Course Goals

Course Purpose

Course Objectives

Course Goals:Enable STA Engineers to:

• Identify their roles and responsibilities.

• Be aware of the interrelationships within the STA organization and Ford Motor Company as a whole.

Course Purpose:• Introduce the specific roles and responsibilities of individual positions within STA.

• Provide context for the discussion of responsibilities addressed in each CQDC topic.

• Provide context for quality tools and processes.

Course Objectives:• Describe the roles of each STA Engineer position.

• Explain the relationship between Site, Program, and Resident STA Engineers.

• Identify the responsibilities of the STA Engineer position.

1



The STA Job

FlexibilityDue to the needs in each region, roles and responsibilities are addressed

differently. This module is a baseline for STA Engineers according to details found on the STA Home page. It is understood that commodity, geography, and other local needs may have an impact on this baseline.

• STA Program Engineers work with multiple supplier sites on specific programs.

• STA Site Engineers work on multiple programs according to and in addition to the sites they are responsible for managing Q1/MSA.

• STA Resident Engineers work with plants that have hundreds of external suppliers from which they will work with specific focus suppliers. They work with suppliers and Program STA on multiple programs as well as Site STA on current product quality, cost, and delivery which include FA/SS, G8D, warranty issues, cost reduction, functional trials, VQR/VRT, FCPA issues, and many more.

• STA Process Specialists work with suppliers on multiple programs, multiple sites, and multiple plants according to their area of expertise.

The Role of the STA EngineerThere are many roles and responsibilities of the STA Engineer. The titles of specific positions are variations on basic roles and responsibilities. It is important to be flexible and be able to work together. The objective of every STA Engineer is to ensure good quality parts get into good cars that satisfy the customer.

Why Flexibility Is NecessaryThe need for flexibility and cooperation between all STA Engineers is evident when the workload of each of the specific positions is reviewed.

Due to the needs in each region, roles and responsibilities are addressed differently. This module is a baseline for STA Engineers according to details found on the STA Home page. It is understood that commodity, geography, and other local needs may have an impact on this baseline.

STA Program Engineers work with multiple supplier sites on specific programs.STA Site Engineers work on multiple programs according to and in addition to the sites they are responsible for managing Q1/MSA.STA Resident Engineers work with plants that have hundreds of external suppliers from which they will work with specific focus suppliers. They work with suppliers and Program STA on multiple programs as well as Site STA on current product quality, cost, and delivery which include FA/SS, G8D, warranty issues, cost reduction, functional trials, VQR/VRT, FCPA issues, and many more.STA Process Specialists work with suppliers on multiple programs, multiple sites, and multiple plants according to their area of expertise.Consider this information as specific roles and responsibilities are discussed throughout this course and the rest of the curriculum. Each STA Engineer has important roles and heavy workloads that will impact the distribution of work at any one time.

2



The STA Job

Resulting Needs• Clear communication when driving task completion.

• Consistency in how the tasks are conducted and reviewed.

• Consistency in communication to the Supplier (one voice).

• Cooperation to ensure tasks are completed when needed.

• Respect for each other’s objectives, workload, skills, and abilities.

Working Together

Each position within the STA organization shares many of the same tasks. The need to have the tasks completed may be driven by the responsibilities of one position, while conducting the tasks may be the responsibilities of another position. For example, the Program Engineer needs Task 1 to be completed by March 1 to support a program launch. The Site Engineer is responsible for conducting the task at the Supplier site. Due to the program being very close to launch, the Resident Engineer may also be involved in reviewing the outcome of the task.

The Program Engineer is proactive supporting program needs, is timeline driven by the launch date and milestones for the program and drives resolution of critical program issue. The Resident Engineer is timeline driven supporting launch, proactive supporting Warranty Reduction and PVT, and will drive critical/chronic plant issues to resolution. Site Engineers are proactive in Supplier development, are timeline driven to support program needs, and drive the resolution of critical issues at the Suppliers plant.

In short, tasks among the STA Engineers overlap. This results in the following needs:

Clear communication when driving task completion.

Consistency in how the tasks are conducted and reviewed.

Consistency in communication to the Supplier (one voice).

Cooperation to ensure the tasks are completed when needed.

Respect for each other’s objectives, workload, skills, and abilities.

3



The STA Job

The Official STA R&R’s

STA Roles and responsibilities (R&R)

• Web site — http://www.purchasing.ford.com/prch_sta/R&Rs.htm

• Appendix A of this guide is an uncontrolled supplement to the web site. The STA Home page must be used to confirm current state ofSTA R&R’s.

4



The STA JobSite STA Engineer Segment I & II (North America)

Characteristics of the position

– Model suggests 2-5 total suppliers per STA due to the workload required.

– Experienced STA.

– CQDC Graduate.

– Manage the MSA’s and other Q1 and Program work for suppliers that have been segmented as I or II.

– Supplement on Appendix A of your participant guide.

The STA Site Engineer Segment I & II

The Segment I and II Site Engineer position has the following characteristics:

• Supports and assists a small number of sites.

• Provides in-depth assistance to improve the quality of the Supplier through the segmentation model.

• Spends approximately 90% of his or her time at Supplier’s sites to assist them in improving their processes.

• Becomes the primary contact for the Supplier within the STA community.

Descriptions of current roles and responsibilities are located on the Ford

intranet at http://www.purchasing.ford.com/prch_sta/R&Rs.htm.

Uncontrolled copies of the roles and responsibilities are located in Appendix A.

5



The STA JobSite STA Engineer Segment I & II R&R – 1

(North America)– Deploy Q1 strategy by conducting on-site Manufacturing Site Assessments.

– Drive Supplier continuous improvement.

– Provide technical support to aid in improving quality systems and drive Supplier concern resolution process.

– Review APQP, establish PPAP level, and disposition PPAP packages as required.

– Conduct launch readiness and Run-at-Rate reviews.

– Assist in facilitating warranty sharing Letters of Agreement (LOA).

6



The STA JobSite STA Engineer Segment I & II R&R – 2 (North America)

– Support 6-Sigma initiatives as required.

– Support Lean and TCM initiatives.

– Drive “non-crisis” based communications between Suppliers and Ford production plants (“non-crisis” is outside of Stop Ships, FSA, etc, which will involve multiple STA roles to drive communication).

– Serve as single point of contact, accountable for site performance.

– Monitor SIM and ensure STA databases are updated with Supplier-related information.

– Approve PFMEAs and Control Plans for inverted delta parts (with product development).

– Support Purchasing with new Supplier sourcing.

– Review capability data and drive variability reduction.

7



The STA JobSTA Site EngineerSegment III & IV (North America)


– Model suggests 20 to 50 suppliers per STA.

– STA should have completed CQDC and have demonstrated basic STA skills.

– Suppliers are self sufficient and have a history of good quality on current production, programs, etc.

– Accountable for all Q1/MSA work for the Segment III/IV suppliers.

– Program work with suppliers is accepted according to negotiation with the Program STA.

– Supplemental reference Appendix A of the participants guide.

The STA Site Engineer Segment III & IV

The Segment III and IV Site Engineer position has the following characteristics:

• Manages a larger number of sites.

• Drives resolution of critical issues.

• Monitors coordinates, and communicates with Suppliers.

• Travels as required.

• Becomes the primary contact for the Supplier within the STA community.




8



The STA JobSTA Site EngineerSegment III & IV R&R – 1 (North America)

– Deploy Q1 strategy and drive continuous improvement actions through Supplier business unit; conduct on-site assessments as necessary.

– Provide technical support to aid in improving quality systems and drive Supplier concern resolution process.

– Review Supplier APQP status for High Impact Suppliers as directed.

– Establish Supplier PPAP level.

– Conduct Launch Readiness and Run-at-Rate reviews at High Impact Suppliers as directed.


– Support 6-Sigma initiatives as required.

9



The STA JobSTA Site EngineerSegment III & IV R&R – 2 (North America)

– Support Lean and TCM initiatives.

– Drive “noncrisis” based communications between Suppliers and Ford plants.

– Serve as single point of contact, accountable for site performance.

– Monitor SIM; ensure STA databases are updated with Supplier-related information.

– Approve PFMEAs and Control Plans for inverted delta parts.

– Disposition PPAP packages as directed.

– Support Purchasing with new Supplier sourcing.

– Review capability data and drive variability reduction.

10



The STA Job

STA Site/Commodity Engineer(Europe)


– Supports Sourcing for Quality– Q1 Mfg Site Assessment and follow-up on Action plan– Support Fix or Leave strategy– Drive 8D Resolution with suppliers– Support 6 Sigma, Lean activities– Verify & Monitor QOS of suppliers, drive improvement– Support Stop Ship and FSA resolution– Manage Supplier QR disputes– Support Warranty Reduction activities– Co-lead Business Unit Reviews as requested– Support Strategit Commodity Teams and Global Councils as requested– Review and approve PPAP– SIM Updates– Manage multiple supplier sites/commodities

The STA Site/ Commodity Engineer - Europe

• Supports Sourcing for Quality

• Q1 Mfg Site Assessment and follow-up on Action plan, Support Fix or Leave strategy

• Drive 8D Resolution with suppliers

• Support 6 Sigma, Lean activities

• Verify & Monitor QOS of suppliers, drive improvement

• Support Stop Ship and FSA resolution

• Manage Supplier QR disputes

• Support Warranty Reduction activities

• Co-lead Business Unit Reviews as requested

• Support Strategic Commodity Teams and Global Councils as requested

• Review and approve PPAP, SIM Updates

• Manage multiple supplier sites/commodities




11



The STA Job

STA Program EngineerCharacteristics of the position

– Travel according to the program needs (most travel is by site STA)

– Assigned to specific programs.

– Report out to high level program management.

– Communication skills required.

– CQDC Graduate.

– Works with a High Impact supplier list unless a Supplier Base Launch Team (SBLT) is in place.

– Appendix A of the participants guide

The STA Program Engineer

The Program Engineer position has the following characteristics:

• Tasks are driven by program needs based on Ford Product Development System milestones and program-specific build dates.

• Works closely with program team.

• Monitors, coordinates, and communicates with program team and Site Engineers.

• Travels to launch locations and Supplier sites only as needed.




12



The STA Job

STA Program Engineer R&R – 1

– Support the program team in identifying High Impact Suppliers.

– Communicate program requirements between the appropriate Purchasing Managers, Buyers, and Engineers.

– Communicate High Impact Supplier readiness at required program milestones.

– Support program and launch team efforts, i.e., PST, PAT, and PMTmeetings.

– May support the PFMEA/Control Plan sign-off process for inverted delta parts, Launch Readiness and Run-at-Rate reviews, and disposition of PPAP packages for Segment III & IV High Impact Suppliers as directed.

13



The STA Job

STA Program Engineer R&R – 2

– Provide required on-site launch support; participate prototype builds and drive resolution of Supplier quality issues.

– Review Segment III & IV High Impact APQP status as directed.

– Support the program with campaign prevention and driving best practices across the supply base.

– Ensure STA databases are updated with program-related information.


14



The STA Job

STA Resident Manager (North America)


– Part of the Plant Vehicle Team.

– Indirect reporting to the PVT manager, direct reporting to the Resident Supervisor.

– Works well in a Plant environment.

– Good communication skills.

– Experienced STA well rounded in all STA functions.

– Participates in Plant Management meetings.

– CQDC Graduate, Potential SME

– Uncontrolled reference, Appendix A

STA Resident Manager (North American Plants only)

The characteristics of the Resident Manager position include:

• Located on-site at Ford Assembly Plant.

• Primarily concerned with addressing unresolved issues between manufacturing and Supplier sites.

• Coordinates with Site Engineers to bring Suppliers and plant together to discuss issues.

• Supports assembly plant Program Vehicle Team (PVT) initiatives.

• Manage new model launches for programs that are of the size of S1-S2 and/or P1-P2.




15



The STA Job

STA Resident Manager R&R – 1(North America)

– Provide STA plant coverage for all launch programs from 1PP build through launch (including added starter programs).

– Support launch reviews as required and provide interface with PVT/Plant.

– Assist Site Engineers as required in disposition of PPAP packages.

– Assist STA Site Engineers as required in completion of Supplier Run-at-Rate reviews.

– Assist Site Engineers as needed in identification and resolution of chronic external Supplier quality performance issues.

– Assist the plant incoming quality (IQ) department in selection of Supplier attendees for the monthly IQ meetings.

16



The STA Job

STA Resident Manager R&R – 2(North America)

– Assist Suppliers and plants in resolving Supplier challenges to QRs, including PPM input.

– Communicate best practices and lessons learned across other associated STA Programs.

– Work with PVT to functionally approve all resourced product.

– Support the PVT/Plant Variability Reduction Team (VRT) in analyzing Supplier warranty and initiating corrective actions that reduce R/1000 and CPU.

– Support PVT-led high-mileage reliability projects.

– Support plant-specific 6-Sigma projects when required.

17



The STA Job

STA Resident EngineerCharacteristics of the position

– Reports to the STA Resident Manager (North America).– Reports to the Program Manager (Europe).

– Part of the Plant Vehicle Team.

– Indirect reporting to the PVT manager.

– Works well in a Plant environment.

– Good communication skills.

– CQDC Graduate.

– Participates in Plant Management meetings.

– Uncontrolled reference Appendix A

STA Resident Engineer

The Resident Engineer supports the Resident Manager with the same characteristics, except that the scope may be smaller (one line at the plant, rather than the whole assembly plant).

• Located on-site at Ford Assembly Plant.

• Primarily concerned with addressing unresolved issues between manufacturing and Supplier sites.

• Coordinates with Site Engineers to bring Suppliers and plant together to discuss issues.

• Supports assembly plant Program Vehicle Team (PVT) initiatives.

• Manage new model launches.




18



The STA Job

STA Resident Engineer R&R – 1– Support the plant for all new model launch programs not covered by Program STA.

– Support Launch Readiness Reviews as required and provide interface with PVT/Plant.

– Assist Site Engineers as required in disposition of PPAP packages.

– Assist STA Site Engineers as required in completion of Supplier Run-at-Rate reviews.

– Assist Site Engineers as needed in identification and resolution of chronic external Supplier quality performance issues.

– Assist Suppliers and plants in resolving Supplier challenges to QRs, including PPM input.

19



The STA Job

STA Resident Engineer R&R – 2

– Communicate best practices and lessons learned across other associated STA Programs.

– Work with PVT to functionally approve all resourced product.

– Support the PVT/Plant Variability Reduction Teams in analyzing Supplier warranty and initiating corrective actions that reduce R/1000 and CPU.

– Support PVT-led high-mileage reliability projects.

– Support plant-specific 6-Sigma projects when required

20



The STA Job

Process Specialist


– Recognized for a specific skill or commodity area of expertise.

– Global Availability.

– Subject Matter Expert in the specialty.

– Extensive travel.

– Problem solving skills.

– Good communication skills, verbal and written.

– Part of a commodity group (North America).

– Reports to an STA Commodity Manager (N.A.).


STA Process Specialist

The Process Specialist is a resource for the other STA Engineers within their area of technical expertise. Characteristics of the position are:

• Provides process expertise to STA/Ford for their particular specialties.

• Monitoring and maintaining reports within areas of expertise.

• Work with all areas of the department.

• Visit sites to support areas of expertise.




21



The STA Job

Process Specialist R&R – 1

– Drive continuous improvement in Suppliers within area of process expertise.

– Assess Supplier capabilities and drive improvement plans.

– Prioritize Supplier site efforts based on Supplier performance and vehicle/part criticality.

– Identify systemic supply base deficiencies.

– Manage reports on Supplier sites within area of process expertise.

– Communicate Supplier capabilities to STA, Purchasing, and RVT.

22



The STA Job

Process Specialist R&R – 2

– Support STA by providing technical expertise within the area of process expertise.

– Develop and deploy best practices within supply base and STA through the benchmarking process.

– Resolve critical Supplier quality and throughput issues, as requested.

23



The STA Job

6-Sigma Black Belt


– Verified through training and projects.

– Dedicated to BB projects (North America).

– Analytically competent.

– Proven problem solving skills.

– Holistic Process knowledge.

– Competent in SPC, Lean, Value Stream Management.


6-Sigma Black Belt

The 6-Sigma Black Belt is a resource for the other STA Engineers within their area of

technical expertise. The main characteristic of the position is:

• Intense project work.




24



The STA Job

6-Sigma Black Belt R&R

– Assist Project Champions in identifying and scoping Consumer Driven 6-Sigma projects.

– Drive Value of Customer Satisfaction Improvement using 6-Sigma methodology.

– Deliver 3-4 projects per year that address customer satisfaction issues, improve process capability, and improve cost savings/revenue.

– Provide expertise to department in 6-Sigma methodology and tools.

– Teach 6-Sigma methodology and tools to Green Belts as required.

– Drive internal culture toward “Management by Facts.”

25



The STA Job

STA Lean Manufacturing Specialist– Assist supplier sites in implementing lean manufacturing practices; Lead

improvement workshops as required.

– Use Lean Tools as needed for process improvement:• Current- and future-state Value Stream Maps.• Perform Value Chain Analysis.• Assess and calculate Overall Equipment Effectiveness.• Conduct cycle time and line load analysis.• Conduct capacity constraint analysis.

– Assess manufacturing gaps and opportunities, and compare findings to world-class benchmarks.

– Assist suppliers to establish work-plans to achieve best in class performance.

– Provide manufacturing technical assistance as required to resolve constraints.

– Support the TVM process as requested.

26



The STA Job

Strategy Business Office

– Finance Analyst – Field Action Cost Recovery, Warranty Reduction, Budget/ Headcount.

– Sourcing for Quality – Process lead, e-MSA lead.

– Lead for: EBusiness (SIM, GSDB), Q1, PPAP, QOS, APQP, GPDS, Segmentation.

– Stop Ship/Field Action reduction process lead.

– Co-Lead: World Excellence Awards.

– Business Process Development and Standardisation

– Strategy Research and Development

– Reporting

– Communication

27



The STA JobProduction Launch

Link to Production Launch

This graphic illustrates the relationships of the various STA positions during a new modellaunch.

• The Program Manager may start work on a program 36 to six months prior to launch (Job1) and may be working on multiple programs. From 1PP to Job1, responsibilities shift to the Resident Manager and/or Resident Engineer involved in the launch.

• The Program Engineer will work with the program team from initial assignment until a defined period after Job1.

• The Resident Manager/Engineer is already working with a current model program while preparing for the new model to begin production at the assembly plant. A Resident Engineer at a plant may not be involved if the line he or she works with is not involved in the launch.

• The Site Engineer will be involved with the Program Manager/Engineer at milestones and builds.

• The Site Engineer, Process Specialist, and 6-Sigma Black Belt will be involved where necessary to resolve issues with current and new model programs.

28



The STA Job

Summary

Work Together.

You are an STA Engineer.

29


APPENDIX A

Site Engineer Segment I & II (North America)

•Deploy Q1 strategy by conducting on-site assessments•Drive Supplier continuous improvement•Provide technical support to aid in improving quality systems and drive Supplier concern resolution process•Review APQP, establish PPAP level and disposition PPAP packages as required •Conduct Launch Readiness and Run at Rate reviews•Assist in facilitating warranty sharing Letters of Agreement (LOA)•Support 6-Sigma initiatives as required•Support Lean and TCM initiatives•Drive “non crisis” based communications between Suppliers and Ford Production plants•Serve as single point of contact, accountable for site performance•Monitor SIM and assure STA databases are updated with Supplier related information•Approve PFMEAs and Control Plans for inverted delta parts•Support Purchasing with new Supplier sourcing•Review capability data and drive variability reduction

STA Site Engineer III & IV (North America)

•Deploy Q1 strategy and drive continuous improvement actions through Supplier business unit. Conduct on-site assessments as necessary•Provide technical support to aid in improving quality systems and drive Supplier concern resolution process•Review Supplier APQP status for High Impact Suppliers as directed•Establish Supplier PPAP level•Conduct Launch Readiness and Run at Rate reviews at High Impact Suppliers as directed•Assist in facilitating warranty sharing Letters of Agreement (LOA)•Support 6-Sigma initiatives as required•Support Lean and TCM initiatives•Drive “Non crisis” based communications between Suppliers and Ford Production Plants•Serve as single point of contact, accountable for site performance•Monitor SIM and assure STA databases are updated with Supplier related information•Approve PFMEAs and Control Plans for inverted delta parts•Disposition PPAP packages as directed•Support Purchasing with new Supplier sourcing•Review capability data and drive variability reduction

30


APPENDIX A (cont.)

The STA Site/ Commodity Engineer - Europe

•Supports Sourcing for Quality•Q1 Mfg Site Assessment and follow-up on Action plan, Support Fix or Leave strategy•Drive 8D Resolution with suppliers•Support 6 Sigma, Lean activities•Verify & Monitor QOS of suppliers, drive improvement•Support Stop Ship and FSA resolution•Manage Supplier QR disputes•Support Warranty Reduction activities•Co-lead Business Unit Reviews as requested•Support Strategic Commodity Teams and Global Councils as requested•Review and approve PPAP, SIM Updates•Manage multiple supplier sites/commodities

STA Program Engineer

•Support Purchasing with new Supplier sourcing•Support the Program team in identifying High Impact Suppliers•Communicate Program requirements between the appropriate Purchasing Managers, Buyers, and Engineers•Communicate High Impact Supplier readiness at required Program milestones•Support Program and launch team efforts, i.e. PST, PAT, and PMT meetings•Support the PFMEA/Control Plan sign off process for inverted delta parts, Launch ‘Readiness and Run at Rate reviews, and disposition of PPAP packages for Segment III & IV High Impact Suppliers as directed•Provide required on-site launch support. Participate in prototype builds and drive resolution of Supplier quality issues•Review Segment III & IV High Impact APQP status as directed•Support the Program with Campaign Prevention and driving Best Practices across the supply base•Assure STA databases are updated with Program related information•Assist in facilitating warranty sharing Letters of Agreement (LOA)

STA Resident Manager (North America)

•Provide STA plant coverage for all launch programs from 1PP build through launch (including added starter programs)•Support launch reviews as required and provide interface with PVT/Plant•Assist Site Engineers as required in disposition of PPAP packages•Assist STA Site Engineers as required in completion of Supplier Run at Rate reviews•Assist Site Engineers as needed in identification and resolution of chronic external Supplier quality performance issues

31


APPENDIX A (cont.)

STA Resident Manager (North America) cont.

•Assist the plant incoming quality (IQ) department in selection of Supplier attendees for • the monthly IQ meetingsAssist Suppliers and plants in resolving Supplier challenges to QRs, including PPM input •Communicate best practices and lessons learned across other associated STA programs•Work with PVT to functionally approve all resourced product•Support the PVT/Plant Variability Reduction Team (VRT) in analyzing Supplier warranty • and initiating corrective actions that reduce R/1000 and CPU•Support PVT led high mileage reliability projects•Support plant specific 6-Sigma projects when required

STA Resident Engineer

•Support plant coverage for S1/P1-S3/P3 launch programs from 1PP build through launch•Support Launch Readiness Reviews as required and provide interface with PVT/Plant •Assist Site Engineers as required in disposition of PPAP packages•Assist STA Site Engineers as required in completion of Supplier Run at Rate reviews•Assist STA Site Engineers as needed in identification and resolution of chronic external • Supplier quality performance issues•Assist Suppliers and plants in resolving Supplier challenges to QRs, including PPM input •Communicate best practices and lessons learned across other associated STA Programs•Work with PVT to functionally approve all resourced product•Support the PVT/Plant Variability Reduction Teams in analyzing Supplier warranty and • initiating corrective actions that reduce R/1000 and CPU•Support PVT led high mileage reliability projects•Support plant specific 6-Sigma projects when required

32


APPENDIX A (cont.)

Process Specialist

•Drive continuous improvement in Suppliers within area of process expertise•Assess Supplier capabilities and drive improvement plans•Prioritize Supplier site efforts based on Supplier performance and vehicle/part critically•Identify systemic supply base deficiencies•Manage reports on Supplier sites within area of process expertise•Communicate Supplier capabilities to STA, Purchasing & RVT•Support STA by providing technical expertise within the area of process expertise•Develop and deploy Best Practices within their supply base and STA through the benchmarking process•Resolve critical Supplier quality & throughput issues, as requested

6-Sigma Black Belt

•Assist Project Champions in identifying and scoping Consumer Driven 6-Sigma projects•Drive Value of Customer Satisfaction Improvement using 6-Sigma methodology•Deliver 3-4 projects per year that address Customer Satisfaction issues, improve process capability and produce cost savings/revenue improvement•Provide expertise to department in 6-Sigma methodology and tools•Teach 6-Sigma methodology and tools to Green Belts as required•Drive internal culture towards “Management by Facts”

33


APPENDIX A (cont.)

STA Lean Manufacturing Specialist

•Assist supplier sites in implementing lean manufacturing practices.•Lead improvement workshops as required.•Use Lean Tools as needed for process improvement:

- Current- and future-state Value Stream Maps.- Perform Value Chain Analysis.

- Assess and calculate Overall Equipment Effectiveness.- Conduct cycle time and line load analysis.- Conduct capacity constraint analysis.

•Assess manufacturing gaps and opportunities, and compare findings to world-class benchmarks.•Assist suppliers to establish work-plans to achieve best in class performance. •Provide manufacturing technical assistance as required to resolve constraints. •Support the TVM process as requested.

Strategy Business Office

•Finance Analyst – Field Action Cost Recovery, Warranty claims, Budget/Headcount•Warranty Reduction – Quality and Cost•Sourcing for Quality – Process lead, e-MSA lead•STA e-Business (SIM, GSDB)•Process Lead:

- Q1- PPAP- STA QOS - APQP- Segmentation

•GPDS on behalf of Quality Deliverables for suppliers•Stop Ship/Field Action reduction process Lead•Co-Lead: World Excellence Awards•Business Process Development & Standardization•Strategy Research & Development•Reporting•Communication

34

��

��

��

Participant Guide FPDS

The subject matter contained herein is covered by a copyright owned by: FORD MOTOR COMPANY

CORPORATE QUALITY DEVELOPMENT CENTER DEARBORN, MI

Copyright © 2001-2006 Ford Motor Company This document contains information that may be proprietary. The contents of

this document may not be duplicated by any means without the written permission of Ford Motor Company.

All rights reserved


© 2003-2006 Ford Motor Company Version: June 2006 1

Introduction

Welcome to Ford Product Development System (FPDS), part of the Corporate Quality Development Center (CQDC) curriculum. This course will be used to tie together the other courses within the CQDC curriculum.

How This Course Relates to Other Courses

The following Sourcing and Focusing Resources curriculum courses relate to FPDS:

• Supplier Selection

• Sourcing the Best

• Supply-Based Quality Segmentation

Agenda

Introduction

What Is FPDS?

Summary

Additional Resources

FPDS Participant Guide

2 Version: June 2006 © 2003-2006 Ford Motor Company

FPDS

� ��

��

When using FPDS, Ford Motor Company:

� Plans new vehicles� Designs new vehicles� Develops new vehicles� Launches new vehicles

FPDS

� ��

��

The goal of the FPDS course is to provide a consistent understanding

of the Ford Product Development System (FPDS), focusing on

ensuring Supplier compliance with the FPDS timeline.

FPDS

� ��

��

• Describe the FPDS process• Describe the role of a STA Engineer within

the FPDS process• Describe the relationship and impact of the

cycle plan to FPDS timing• Describe the program timeline and the

elements affecting differences in programs• Identify additional resources available to

provide details of FPDS

Upon completion of this course, the participant will be able to:

• Describe the FPDS process including timeline, milestones, scalability, product cycle plan, and impact of milestones on STA (required deliverables)

• Describe when the STA Engineer gets involved within the FPDS process

• Describe the relationship and impact of the cycle plan to FPDS timing

• Describe the program timeline and the elements affecting differences in programs

Powertrain vs. Vehicle Operations

Program size (e.g., S6/P6 vs. S1/P1)

• Identify additional resources available to provide details of FPDS



FPDS

� ��

��

The model used is “top-down” for:� Vehicle level (whole vehicle)� Systems and subsystems� Component level with bottom-up

verification.

What Is FPDS?

Systems Model • Systems Engineering underpins FPDS. The model used here is “top-down” from the

vehicle level (whole vehicle) through the systems and subsystems down to the component level with bottom-up verification from components back to the vehicle level.



FPDS

� ��

�� !��

Attributes

Cost Security Safety

Vehicle

FPDS

� ��

�� !��

VehicleSystem

FPDS

� ��

�� !��

VehicleSystem

Components

Systems Model continued • Vehicle level — At the top level, inputs from the customer, regulatory organizations

and Ford are translated into vehicle attributes such as cost, security, NVH (Noise, Vibration, Harshness), etc. The vehicle attributes will be used to define the Vehicle Design Specifications (VDS). System examples include body, electrical, powertrain, and chassis.

• System level — The system level includes powertrain, chassis, etc. including information about the Suppliers being brought in under phased sourcing.

Level 1 subsystems include sheet metal, electrical distribution system, engine, and suspension.

Level 2 subsystems include front end, fuses, ignition, and wheels.

• Component level — Examples of components include: brackets, fuel injectors, switches, etc.



FPDS

� ��

�� "

CLIMATECONTROLSystems

• Sheet Metal• Exterior Trim• Interior Trim• Customer

Convenience & EntertainmentIP & Console

• Seating & Restraints

• ElectricalDistributionSystem

• Body Controls• Electronic Security

• Electrical PowerGeneration &Storage

• Intelligent VehicleHighway Systems

• Communications Network

• Engine• Transmission• Driveline Axle• Powertrain as Inst.• Powertrain

ElectronicControls

• Suspension• Steering• Brakes• Frame/Sub-Frame• Fuel Deliveryand Storage

• InteractiveControls

• Refrigeration• Air Handling• Heater• Controls

Level 1Subsystem

CHASSISPOWERTRAINELECTRICALBODY

VEHICLE

Vehicle Partitioning

Another way to think about the Systems Model is to begin with the whole vehicle and partition the systems, i.e., chassis, engine, etc., and then drop down another level within chassis, e.g., brakes.



FPDS

� ��

�� #��

��

S6/P6 42 months

S5/P5 41 months

S4/P4 37 months

S3/P3 32 months

S2/P2 24 months

S1/P1 18 months

SI SC PH PA ST PR CP CC LR LS J1 FSPTKO

Scalability

The concept of Scalability is used to ensure that all programs meet the same milestones—both Vehicle and Powertrain. Scalability is a concept used to define the scope and depth of a program identified by the following codes:

S1 Refers to trim (new seat sew style modifications only for seats, insert material changes for interior appliqués)

S2 Refers to minor freshening, e.g., new seat pads, lamp decoration with carryover tooling and optics

S3 Refers to moderate freshening, e.g., carryover inner panels, new outers

S4 Includes carryover platforms, i.e., all new to the customer

S5 Includes modified platforms, i.e., carryover platforms with structural changes

S6 Includes new platforms, i.e., all new platform and structure

P1 Carryover powertrain, minor calibration

P2 Carryover engine/transmission, moderate calibration

P3 Minor engine/transmission, major calibration/minor emissions

P4 New use engine/transmission, new calibration/major emissions

P5 Major engine/transmission upgrade, first use emissions

P6 New engine/combustion, new transmission/powerflow



FPDS

� ��

��

S6 S5 S4 S3 S2 S1

P6

P5

P3

P2

P1

P4

CombinationNot Allowed.

Vehicle stretches to powertrain timing.

Powertrain stretches to vehicle timing.

VEHICLE SCALABILITY

PO

WE

RTR

AIN

SC

AL

AB

ILIT

Y

P6-S6

P5-S5

P4-S4

P3-S3

P2-S2

P1-S1

Scalability Combinations

Combinations of Vehicle and Powertrain programs produce timing determined by the longest lead. Some combinations are not allowed, e.g., small vehicle enhancements with large changes to the powertrain.

Program milestones are established as a result of the “worst case” Powertrain or Vehicle change.



FPDS

� ��

$��

Optimize

Vehicle

System

Subsystem

Component

Product/ProcessDesign

Cascade Verif

y

Design/Mfg.

Confirmation

Launch/Mass Prod.

Confirmation

UpdateCorporateMemory

MANAGE

DefineArchitecture

ProgramInput

DEFINE

DESIGN

VERIFY AND LAUNCH

PS1KO PS2 SI PASC PH ST PR CP J1 FSLSLR

CC

14.5 041 30 1925.5 -350



Key Phases

Functions and processes within FPDS are grouped into key phases. One may consider all groupings arbitrary, but the ones that have emerged within FPDS are Define, Design, Verify and Launch, and Manage.

Define Phase Key Events

• Targets Define target ranges.

• Phased Sourcing Bring Suppliers on board during this time as part of the team.

• Reusability Establish level of reusability, which differs depending on the commodity.

Design Phase Key Phase Events

• Reliability Design reliability into the product.

• Analytical Engineering Use analytical engineering (C3P) to ensure reliability.

• Appearance Appearance, function, and package reduce the level of engineering time spent on fine feasibility of appearance concepts by the use of “coarse feasibility” processes. This allows adequate feasibility of multiple appearance and package concepts to support final appearance selection within defined resources.

• Total Manufacturing Involvement Design and Manufacturing work together from the start of the project.

• Phased Data Notification Phased release of data through the CAD system and WERS (the non-geometric data).



Key Phases, continued

Verify and Launch Phase Key Events

• Prototype Phases CAE

Lab and rig testing

Attribute Prototypes

Confirmation Prototypes

• Bundled Changes Group changes to ensure compatibility of the requested changes.

Engineers review the interrelationship of requested changes to a part.

Although you may view these phases as discrete, there is considerable overlap in their timing.

Manage Phase Key Events

The manage phase spans the entire FPDS process.

• Team Structures Teams are formed early in the process.

• Quality Operating System Project Management and the Quality Operating System (Integrator) manage the project ensuring that changes are grouped to avoid expensive individual changes.

• FPDS Communications Work Breakdown Structure

Integrator

Lessons learned

• Best Practices



FPDS

� ��

��

Vehicle

System

Components

KO

Kick Off

KO SI

Strategic Intent

SC

Strategic Confirmation

PH

Proportions &

Hardpoints

PA

Program Approval

ST

SurfaceTransfer

PT

PowertrainDesign

Complete

PR

Product Readiness

CP

Confirmation Prototype

CC

ChangeCut-Off

LR

Launch Readiness

LS

Launch Sign-Off

J1

Job 1

FS

Final Status

841 36 33.5 30 25.5 14.5 4.5 3.25 0 -319



Milestones

“Milestones” signify the completion of specific measurables of the program.

• (KO) Kick off Key Events

(KO) is the beginning of program-specific work

Program “Black Book” compiled and signed-off (includes craftsmanship targets)

Program “one-pager” filed with Product Planning & Technology (PP&T) (hand-off from Business Office to Program Team)

• <PS1> – <Pre <SI> Milestone 1

Mission, vision, and Affordable Business Structure (ABS) agreed, initial strategies developed

Customer profile established, preliminary Brand Profiler available

Customer/market/competitive requirements defined

Regulatory/corporate needs/wants identified

Benchmark/comparator vehicles identified

• <PS2> – <Pre <SI> Milestone 2

Preliminary functional target ranges and design strategy proposed

Preliminary alternatives/supporting assumptions defined

Derivative capabilities assessed

Preliminary post <SI> resource/facility plans and program workplan established

Sourcing Council approval to conduct make/buy studies

• <SI> Strategic Intent Key Events (Percent of parts sourced at SI depends on scalability of the program and commodity. This is a purchasing metric.) Strategies for product, market, manufacturing, supply, design and reusability

confirmed Major customer/corporate wants and regulatory requirements compliance plans

done Compatible vehicle-level target ranges and product assumptions established

consistent with ABS (includes craftsmanship) Appearance Stakeholder Team commits to appearance image New technologies identified, P/T and vehicle architecture are implementation-

ready Program logistics confirmed — timing, workplan, resources, and facilities (targets

are set, product content is available, this information feeds APQP) Scale model



Milestones, continued • <SC> Strategic Confirmation Key Events

Vehicle/system/level 1 subsystem targets committed

Powertrain lineup selected

Manufacturing assembly location for each derivative confirmed

All system/subsystem Suppliers selected/part of the team

Long lead funding to Board of Directors (if required)

Initial Attribute Prototype (AP)/Confirmation Prototype (CP) plan is available

• <PH> Proportions and Hardpoints Key Events

Freeze proportions and selected hardpoints

Freeze people and cargo package

Hardpoints and structural joint designs are compatible with all program targets

Level 2 subsystem targets committed

Appearance themes have been reviewed in market research (interior/exterior)

• <PA> Program Approval Key Events

Theme approval for interior and exterior appearance (all trim levels)

All targets become objectives

Approve program facilities and tooling investment

Marketing commitment to net revenue; initial ordering guide available

Program Design Verification Plans (DVPs) and Failure Mode and Effects Analysis’ (FMEAs) complete (This is a design activity. If the Supplier is designing the part, then it is responsible for completing these activities.)

Program Parts List (PPL) complete

Powertrain cross-section design complete with manufacturing sign-off

Final prototype (AC/CP) plan available

• (ST) Surface Transfer Key Events

Approved theme refined for craftsmanship execution (consistent with <PA> Objectives

Interior and exterior Class IA stichable surfaces transferred to engineering

Phased Data Notification process initiated



Milestones, continued • (PT) P/T Design Complete (24 months for a P5 program)

Powertrain analytical design verification and calibration complete

Batch 1 prototype assembly starts

Powertrain manufacturing feasibility sign-off

100 K emission testing initiated

• <PR> Product Readiness

Full vehicle analytical sign-off; all objectives can be met

Last Class I surface verified and released for major formed parts

Final Math 1, 2, and 3 phased data notification’s are complete

Launch plan is confirmed and issued

CAD files reflect Pre-(CP) verification changes

Data Control Model signed off

• (CP) Confirmation Prototype Key Events (STA Engineers get involved with the builds; they may get involved with earlier builds depending on the program.)

“Make like production” prototype part and assembly tools/ergonomics/process sheets (to the extent feasible)

First CPs available for tuning and durability testing

Coordinate measuring machine (CMM) analysis complete for all CP end-items and subassemblies

P/T commitment to support Production Validation (PV) with Part Submission Warrant (PSW) parts

• <CC> Change Cut-Off Key Events Preliminary Engineering Sign-off complete

♦ CP durability testing ♦ Known changes from CP containable for 1PP ♦ Initial set of road tests completed ♦ Design is at Job #1 level — no further design changes except “No Builds” ♦ Engineering confidence declared that objectives will be met ♦ Management drive completed

Color/graining tooling authorization Supplier commitment to support 1 PP with PSW parts Decision required to support lifetime runs, changeover tooling, etc.



Milestones, continued • <LR> Launch Readiness Key Events

Final Engineering Sign-off (excluding Certification/Safety documentation) completed:

♦ Functional objectives met

♦ Final road tests completed

♦ Formal certification/homologation (except emissions) testing complete

Readiness to proceed to Tool Try-Out (TTO), 1PP, and Job 1

CP/Hard Tooled Functional Build (HTFB) issues resolved

All production assembly tools functioned at tool source or in homeline

Color/textures/gloss sign-off complete

100% PSW parts available for 1PP

• <LS> Launch Sign-Off

Analytical models are correlated with CP test results

Tool Try-Out (TTO) and 1PP complete

Assembly plant tools and process verification complete including aids and fixtures

New Overall Vehicle Audit (Nova C)<5 on manufacturing-controlled items

• (J1) Job 1 Key Events

Integrated Launch complete

Operator training complete and continuing through ramp-up

In-process and final quality indicators meet program objectives

Powertrain Production Validation (PV) complete in support of P/T plant’s Job1

Field Evaluation Unit (FEU) drive complete

New Overall Vehicle Audit (Nova C)<3(FCPA [Ford Consumer Product Audit])

CAE models correlated and bookshelf updated

• (FS) Final Status Key Events

Final status report due six months after Job1

Senior management reviews market acceptance, quality, financial results, and lessons learned



Cycle Plan

Refer to Appendix B and review the sample cycle plan.

The cycle plan defines the programs, including:

• The model year

• The scale of the program

• The number of expected new parts

• The expected timing for 1PP and Job 1

Using the cycle plan and the scalability, needed resources are identified. When we overlay the cycle plan on the scalability chart, it tells us the “number” of resources needed to do the program. When we overlay all programs, the “total number” cannot exceed “X.” If it does, that means resources are not available to do the program and something must be scaled back or resources added.



FPDS

� ��

%��"��

Optimize

Vehicle

System

Subsystem

Component


Cascade Verif

y

Design/Mfg.

Confirmation

Launch/Mass Prod.

Confirmation


DefineArchitecture

ProgramInput

DESIGN

KO PS1 PS2 SI PASC PH ST PR CP J1 FSLSLR

CC

14.5 041 30 1925.5 -350

Design Phase

Engineering for Reliability

Engineering for Reliability focuses on characteristics of a reliable product and the tools that are used to achieve reliability within FPDS.

Predictive and Analytical Engineering

Computer Aided Engineering (CAE) techniques are used to design in robustness as part of the C3P package.

Package and Appearance

Package and Appearance covers these features from the design strategy before <SI> through theme approval to the optimization of the design at (ST).

Total Manufacturing Involvement

Total Manufacturing Involvement is Ford’s implementation of simultaneous engineering.

Phased Data Notification

Phased Data Notification is just-in-time data delivery tailored for the manufacturing process.



FPDS

� ��

!�&��&��%��"�

*A robust system is insensitive to noises and has a low failure *A robust system is insensitive to noises and has a low failure rate over the designrate over the design’’s expected life.s expected life.

INFANTMORTALITY

EXPECTEDLIFE

WEAROUT

NonNon--Robust Robust DesignDesign

Robust DesignRobust DesignFailu

re R

ate

Failu

re R

ate

TimeTime



Reliability

Engineering for Reliability occurs primarily in the Design Phase. A product shows reliability when it performs its intended function for a specified life under operating conditions and when it exceeds customer expectations.

Reliability is important because quality is a primary concern of Ford’s customers. Therefore, at Ford, reliability is of primary importance. A prerequisite to reliability is robustness. Robustness is the ability of a product or process to perform its intended function under a variety of environmental and other uncontrollable conditions throughout its life cycle at the lowest possible cost. A robust design is insensitive to “noise” variation. The “bathtub curve” illustrates the reliability of robust designs versus non-robust designs.

The FPDS charter is to deliver a vehicle with features a customer desires that function for 10 years, 150,000 miles. This vehicle will be subjected to operating conditions that will have:

• Variation or “noise”

• Customer usage

• Temperature

• Mileage

• System-to-system interaction

• Piece-to-piece variation

• Changes in dimension due to wear and fatigue

Robustness must be a part of the design; that is, function in the presence of variation. How can this be done? By controlling the sources of variation using reliability tools.



FPDS

� ��

'��(��

Key Life Tests C3P modeling

P (parameter) Diagrams

FMEA Global 8D

Design Verification Plans



Reliability Tools

FMEA Failure Mode and Effects Analysis is a systematic approach that identifies potential failure modes in a system, product, or manufacturing/assembly operation caused by either design or manufacturing/assembly process deficiencies. It also identifies critical design or process characteristics that require special controls to prevent or detect failure modes. FMEA is a tool used to prevent problems from occurring.

P-Diagrams Parameter diagrams act as a framework for the Parameter Design Study, and consist of the system of study, the signal and response, and the control and noise factors. This tool requires thought about the system in terms of intended or ideal function and how the system transfers/transforms energy. The P-Diagram categorizes engineering factors into:

• Control Factors

• Noise Factors

• Signal Factors

• Measured Functional output response

DVPs Design Verification Plans are used to verify component, system, and vehicle design to functional intent.

Global 8D Global 8D is a disciplined team-oriented problem-solving process that applies analytical tools to data in order to identify the problem, define the root cause and escape point, and verify, implement, and validate actions to eliminate the problem, to actuate performance improvement, and to prevent problem recurrence.

Key Life Tests A test that duplicates the stresses under customer operation. It includes the specified extremes of loads, usage, manufacturing/assembly variability, environmental stresses, and their interactions to address a single critical failure mode or a group of failure modes that result from the same stress patterns. It may be accelerated to reduce test time.

C3P Modeling The use of computers in analyzing and optimizing product designs and manufacturing processes.



FPDS

� ��

��&��!��

Vehicle

System

Subsystem

Component


Cascade Verif

yOptimize

Design/Mfg.

Confirmation

Launch/Mass Prod.

Confirmation


DefineArchitecture

ProgramInput

VERIFY AND LAUNCH

KO PS1 PS2 SI PASC PH ST PR CP J1 FSLSLR

CC

14.5 041 30 1925.5 -350

Verify and Launch Phase

During the Verify and Launch Phase, components, systems, and vehicles are verified and tested using Computer Aided Engineering (CAE) and actual builds (Attribute and Confirmation prototypes). Once completed, the final preparation of pre-production vehicles will lead to Job 1.



FPDS

� ��

��

�Analytical

�Lab/Rig/Dynomometer

�Attribute Prototype (AP)

�Confirmation Prototype (CP)

Prototype Phases Analytical C3P is the enabler. The Computer Aided Engineering section is a set of tools

for target setting and validation, design experimentation, design verifications as well as system and attribute integration.

Lab/Rig/Dynomometer These physical tests are used when the analytical tools have been fully exploited. The focus is at the system/subsystem level to verify attributes prior to full vehicle testing, including key life testing, dynomometer testing for calibration and durability. End item/component testing is performed primarily at full-service Suppliers.

AP An Attribute Prototype (AP) is a production vehicle of any make/model, modified to evaluate or provide direction for a specific vehicle attribute. As such, APs are not intended to be batch-built vehicles. Several levels of each AP can be built targeted toward evaluation of different specific attributes. Attribute prototypes content is identified to develop specific vehicle, system, and subsystem attributes.

CP A Confirmation Prototype is a vehicle engineering prototype that is completely representative of production-released design. Their intended usage is for DVP&R confirmation, assembly prove-out, final vehicle tuning, fit and finish evaluation, and durability and certification testing.



FPDS

� ��

��)��

PURPOSEValidate Target

andEarly Design

TargetSetting

VerifyDesignIntent

PowertrainCalibration

Job 1 IntentProduct/Process

Confirmation

FUNCTIONALATTRIBUTESTO BEDEVELOPED

• NVH• Vehicle Dynamics

• Safety• Road Load• Thermo/Aero

• Performance/Emissions

PROTOTYPES

POWERTRAINBUILDS

AP0 AP1 AP2 AP3

IN SUPPORTOF

MILESTONETIMING

StrategicConfirmation

36 mo.

ProgramApproval

30 mo.

SurfaceTransfer25.5 mo.

Product Readiness

19 mo.

1st complete at 14.5 mo.

Attribute Phases

PreliminaryEngineering

Sign-Off

CP

32 - 30 24 - 22 19 - 1739.5 - 38.5

825.541 36 30 19 14.533.5

Batch I22.5--22.75 mo.

Batch II19.25--18 mo.

Batch III15.75--14.75 mo.

Confirmation Prototype



Prototype Builds

Attribute Prototypes

• Attribute Prototypes (APs) are used to support the target-setting process. APs can be used to develop and validate targets for the following attributes:

NVH (Noise, Vibration, Harshness)

Vehicle Dynamics

Safety

Durability/Road Load

Thermo Aero

Performance/Emissions

• APs are typically built from cobbled competitor’s production vehicles or from Ford production vehicles.

• APs are not required to be built to production-intent processes; however, manufacturing is encouraged to observe their construction to help develop production processes.

Confirmation Prototypes

• Confirmation Prototypes (CPs) are built to confirm both the product design and the production process.

• The only product changes that occur after (CP) are those required to fix problems discovered during the Product and Process Confirmation Process.

• Similarly, the only changes made after (CP) to the production processes are those discovered during the Product and Process Confirmation Process.



FPDS

� ��

)��

�CP�HTFB�PSW/Run-at-Rate�1PP�FEU� IB

Production Builds • CP is the first time you start seeing production tooling. There may be two CP builds:

CPF, which is a functional build

CPC, which is a craftsmanship build

• HTFB is just before 1PP (approximately three months). It is a build, not a milestone. It is the first time you see the sheet metal tool tryout.

• PPAP/Run-at-Rate is targeted for completion by 1PP. Run-at-Rate is tracked from the PPAP run and must be completed before Job1. (The PPAP course contains more information.)

• 1PP is full production at the plant with production tooling, the initial phase of the Engineering handoff to the plant.

• FEU (Fleet FieldEvaluation Unit) Builds are saleable units built on production tooling that allow a slow ramp-up of Suppliers and the plant process prove out. Saleable means that the vehicle can be certified to Federal government requirements i.e. CAFÉ, safety tests.

• IB (Integrated Build) is also known as CB (Continuous Build) or 4P (pre-production process prove-out).



Sample Process Timeline



FPDS

� ��

��#�� (��

The Powertrain Team Structure includes:� Powertrain Program Module Team (P/TPMT)� Subsystem Program Module Team (SPMT)� Component Program Module Team (CPMT)

Powertrain Team Structure

The powertrain team structure includes:

• The Powertrain Program Module Team (P/T PMT)

• The Subsystem Program Module Team (SPMT). Typical SPMT names include:

Engine SPMT (also known as EPMT)

Transmission SPMT (also known as TPMT)

ADSE SPMT

VC/CAPE SMPT (this includes calibration, controls, certification/homologation and the as-installed components)

• The Component Program Module Team (CPMT); CPMT is also used to define sub-subsystem teams



FPDS

� ��

�(*�%��%�

• High-Impact Supplier list <SI>• APQP reporting status reports <PA>• Schedule of Supplier Readiness Reviews <PR>• LRR Summary reports <CP> through Job 1• Incoming product sampling plan for high-risk Suppliers

<CP>• List of Suppliers required on-site for vehicle builds

<CP>• Supplier CEO Conference with Ford V.P. <as required>• Executive Champion Review at Critical Suppliers <as

required>• Supplier Operation Management Reviews <as required>

Notes:

• High Impact and Focus Suppliers are Tier 1, external Suppliers that the team feels present substantial risk to the quality or timing of the vehicle program.)

• Executive Champion refers to a Ford Executive Director level person who would act as the Champion to that supplier.

Refer to the Launch QOS (lqos_206) document in the Appendix for more information related to STA deliverables.



What is GPDS? It represents an essential step in the improvement of our product creation process, tools, and culture that will enable us to produce more products, faster.

GPDS adapts the proven Mazda Product Development System v2 (MPDS) benchmark of speed and efficiency. It builds on existing best practices from all our brands around the world to create a lean, integrated process with high levels of reuse of product, process, and manufacturing resources. It will enable more effective technology sharing and promote commonality.



Frequently Asked Questions (FAO) about GPDS

Why move to GPDS?

GPDS will enable each CBG/Brand to improve to World Class levels for stand-alone, joint, and platform programs. Additional benefits include:

• Improve our competitive position via collaboration between departments, brands, divisions, and suppliers

• Match the competition for time to market, engineering efficiency, and quality • Reduce product creation expenses • Improved quality of “product” and “process” execution • Better tailor products to meet customer expectations

How will GPDS help Ford achieve these benefits?

• Driving better planning at the start of programs • Earlier and Better definition of the program makeup • Important decisions made on time using an improved logic sequence • Aggressive execution of the plan with minimal variance • Integration of learning and continuous improvement principles

What is a GPDS enabler?

Enablers are the integration of people, process, and tools that fundamentally change the way we do a part of the business and close critical timing and quality gaps between current product creation processes and GPDS.



FPDS

� ��

��

� Systems Model� Key Phases� Milestones� Scalability� Scalability

Combinations� Cycle Plan

� Reliability� Reliability Tools� Prototypes� Team Structure� STA Deliverables

and FPDS

� Brief description of GPDS



Summary

• Systems Model — FPDS is based on systems engineering. The model is top-down from the vehicle level through the systems and subsystems to the component level with bottom-up verification from components back to the vehicle level.

• Key Phases — The phases are Define, Design, Verify and Launch, and Manage.

• Milestones — These signify the completion of specific measurables of the program.

• Scalability — This ensures that all programs meet the same milestones; both Vehicle and Powertrain.

• Scalability Combinations — Combinations of Vehicle and Powertrain programs produce timing determined by the longest lead.

• Cycle Plan — Using the cycle plan and the scalability, needed resources are identified.

• Reliability — Engineering for reliability occurs primarily in the Design Phase. A product shows reliability when it performs its intended function for a specified life under operating conditions and when it exceeds customer expectations.

• Reliability Tools — The tools are FMEA, P-Diagrams, DVPs, Global 8D, Key Life Tests, and C3P Modeling.

• Prototypes — The prototypes are Analytical, Lab/Rig/Dynomometer, AP, and CP.

• Team Structure — PST, PMT, PAT, PMA, and VPMC.

• STA Deliverables and FPDS — These include the following: High Impact Supplier list; APQP reporting status reports; Schedule of Supplier Readiness Reviews; Launch Readiness Review Summary reports; incoming product sampling plan for high-risk Suppliers; list of Suppliers required on-site; Run-at-Rate exercises at Supplier facility; Supplier CEO Conference with Ford Vice President;, Executive Champion Review at Critical Suppliers; and Supplier Operation Management Reviews.




Web Sites

FPDS utilizes a central repository of processes and procedures held on the Ford Intranet. These include:

• FPDS Integrator — This provides a tool that program teams can use for project management, QOS maintenance, and FPDS process information. It is located at http://www.fpdsonline.ford.com

• Work Breakdown Structure — This is the primary organizer for Ford Product Development. It is located at http:// www.fpdsonline.ford.com

• Lessons Learned — This site captures successes and failures experienced by our organization or from our ongoing efforts to identify and benefit from the relevant experiences of external organizations. It is located at http://www.lessons.ford.com.

• Best Practices — There are more than 500 best practices in the Best Practice Database. By accessing best practices that apply to your program, you can benefit from learning about and using processes that have already been developed, tested, and successfully used in other parts of FPDS. You can find a best practice by entering the FPDS URL (www.fpdsonline.ford.com) to arrive at the FPDS home page. At the FPDS home page, click on Process Ownership Teams & Best Practices under FPDS Supporting Websites and Reference Materials. From this web site, you can find a best practice to help you, or submit a best practice idea. For more information, see the booklet, A Quick Guide to Best Practices.

• GPDS Online – Builds on existing best practices from all our brands around the world to create a lean, integrated process with high levels of reuse of product, process, and manufacturing.

It is located at http://www.gpdsonline.ford.com

•



Sample Cycle Plan

2000 2001 2002 2003

PLANT CARLINE MY PRGM SIZE PARTS Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4

XYA 1999 S6/P6 1200

2000.5 S3 75 J1

2001 S4 300 CP 1PP J1

2001 S1/P2 20 1PP J1

2002 S1 TBD 1PP J1

2003 S5/P5 400 1PP J1

2003 S4/P5 400 CP 1PP J1ABW 2000 S4 860

2001 S1/P3 175 J1

KLN 2000 S1/P1 70

2001 S3/P3 250 1PP J1

2003 S5/P5 400 1PP J1

PLN 2000 S1/P1 50WJK 2001 S4/P4 250 1PP J1

2002 S1/P3 200 1PP J12003.5 S4/P1 1200 CP 1PP J1

NVS 2000 S1 90

2001 S3 300 1PP J1

PLQ 2000 S1 88

2001 S3/P2 140 1PP J1OLM 2002 S2/P4 40 1PP J1

2003.5 S5 900 CP 1PP J1

WDO 2004 S6/P6 1500 CP 1PP J1

ILX 2000 S2/P2 40 J1

2001 S1/P1 450 1PP J1

2002 S2 300 1PP J1

2004 S6P4 900 CP 1PP J1



Sample STA Launch Plan

-180 -120 -60 +60

DAYS AFTER JOB1DAYS BEFORE JOB1

FEU/4P Build Integrated BuildJob 1

PROGRAM MILESTONES

Quality Issue Resolution

Capability Reviews

Launch Readiness Reviews

Launch Support

Phased PPAP Review/Approval

FLAWLESS LAUNCH INITIATIVE- Deliver the vehicle launch using a comprehensive initiative, which utilizes coordinated activities such as:Launch Readiness Reviews - Drive supplier readiness with reviews conducted prior to 1PP and at each build event.Run @ Rate -Execute at the supplier location as soon as the production process is in place and repeated until successful.Phased PSW - Approve on-site when all PPAP & run@rate requirments have been validated and met.Capability Reviews - Verify when processes are capable. Conduct throughout the Vehicle Launch.On-Site Support - Conduct at the supplier location throughout the Flawless Launch initiative.

CAPABILITY REVIEWS- Drive supplier improvements in process capability. When a minimum Ppk of 1.67 is not reached at <LR>, verify workplan is developed to achieve an ongoing Cpk of 1.33.

LAUNCH SUPPORT- Drive resolution of quality issues identified during AIMs binning meetings, drive evaluations, fresh-eyes reviews, and FCPA.- Present supplier quality assessments through management review meetings- Track and report on LRR Status Matrix to the Launch Team- Provide support to Launch Team meetings- Track PSW completion through the Open to Go Process- Direct supplier support during Launch- Track supplier/part status for non-PSW'd parts.LESSONS LEARNED- Drive the gathering of knowledge gained during the Launch and ensure it is applied on future launches, to provide continuous improvement and prevention of concern recurrence.

LAUNCH READINESS REVIEWS (LRR)- Organize cross-functional team that includes: MP&L, Product Engineering, Purchasing, STA Program Engineering, STA Site Engineering and Vehicle Operations. - Lead team in assessments and drive resolution of issues through: MP&L SMART Reviews, Measurment System Reviews, Production Capacity and Process Reviews.

Run @ Rate

Flawless Launch Initiative

RUN @ RATE- Conduct reviews at selected supplier manufacturing sites with all production tooling running at full production speeds and feeds, utilizing all regular produciton personnel. - Signoff supplier process when the run is successful and meets all capacity requirements.

1PP Build

<LR>Final Engineering Signoff100% PSW for 1PPColor/textures/gloss sign-off complete

<LS>Manufacturing assessment of full production feasabilityAssembly plant tools & process verification complete

Lessons Learned

On-Site Support

QUALITY ISSUE RESOLUTION- Identify & resolve quality issues with suppliers- Ensure supplier reworks or replaces parts, which do not meet design specifications- Drive supplier 8D process- Ensure robust corrective actions- Drive resolution of AIM Supplier Quality issues- Identify poor performing suppliers and drive improvements in launch support

ON-SITE SUPPORT- Direct supplier resources to resolve part quality and process capability issues at selected supplier manufacturing locations.

PHASED PPAP REVIEW/APPROVALPhase 1 - Quality Verification - (16 of 19 elements of PPAP - excludes PSW, Appearance Approval and Master Sample) - supplier dispositions in system.Phase 2 - Production Verification for specific program/plant by In Plant Date for 1PP build phase (all 19 elements of PPAP on parts from actual production streams (tools/caities/molds/lines/etc.)) - Supplier dispositions in system and forwards PSW documentationPhase 3 - Capacity Verification - target completion is 4 weeks prior to Job 1 - demonstrating ability to meet Ford required volumes under intended operation pattern - supplier dispositions completion nad provides Demonstrated Weekly Capicity numbers in system.



INCOMING QUALITY (IQ)

ON-GOING INTENSIVE PROCESS

The new IQ process is a parallel quality improvement initiative. It increases cross-functional participation in the systemic improvement of the quality performance of Suppliers and addresses both customer satisfaction and plant quality.

Current Process:

The STA Resident at the plant, with the support of the Plant Vehicle Team (PVT) and IQ Section, identifies the "Top 10" problem Suppliers based on their impact on plant quality and customer satisfaction. The STA Resident drives systemic quality improvement at these Suppliers with the support of Commodity STA.

New IQ Process:

The IQ Engineer at the plant with the support of the PVT, IQ Section and STA Resident identifies the "Top 25" problem Suppliers based on their impact on customer satisfaction and plant performance. The IQ Engineer facilitates improved problem definition at the plant, coordinates improved containment actions at the plant and drives systemic improvement at the Suppliers with the support of the STA Resident and Commodity STA and through on-site Supplier visitations.

Objective: • Prioritize problem Suppliers and issues based on the impact on both the plant and

the customer through Top 25 Customer Satisfaction high leveraged items.

• Improve communication between the Supplier, the plant and the activities involved in quality improvement actions, i.e. IQ Section, STA, PVT, and Production.

• Improve concern definition for quality issues.

• Verify permanent corrective action both systemic and specific.

• Facilitate containment actions to protect the customer.

Process:

Supplier Quality Issues

STEP 1 • Identify and prioritize the Top 25 Customer Satisfaction Supplier concerns based on

plant and customer impact. The IQ Engineer would coordinate this review with support from the STA resident, PVT Manager and the IQ Supervisor. The primary data resources would be the "Top 25 Single Agenda?" the "STA Resident Monthly QOS" and the "SIM (Supplier Improvement Metrics) Report". Attachment 1

STEP 2

• Clearly define the quality problem and categorize supplier quality, plant process and design issues. The IQ Engineer would coordinate this evaluation with support from



I.Q. Section, PVT, Production and the STA Resident, when appropriate. Verify associated CTQs (Critical To Quality) characteristics.

STEP 3

• Verify containment actions are effectively in place to protect the plant and the customer. The IQ Engineer would coordinate this with the support of the IQ Section and the Supplier.

STEP 4

• Determine the Segmentation strategy for the selected Suppliers. The STA Resident would assist in obtaining this information.

STEP 5

• Develop a strategy for resolution of the selected Supplier quality issues. The IQ Engineer would facilitate this process with support from the STA Resident. Typical actions could include calling the Supplier in for an IQ review, requesting on-site reviews at the Supplier by Commodity STA or on-site reviews at the Supplier by the IQ Engineer.

STEP 6

• The STA Resident would notify the Supplier of the planned actions and obtain their commitment to support the process. The IQ Engineer would arrange in plant and on-site reviews with the selected Suppliers.

STEP 7

• The objective of the on-site review would be to verify the Supplier has identified the systemic root causes of the concern and has implemented and verified corrective actions including containment. The Supplier's Global 8D would be the primary tracking document.

STEP 8

• The results of the Incoming Quality Process should be published on a regular basis. The report should be distributed to the Plant Manager, QC Manager, PVT Manager, STA Commodity Engineer, STA Commodity Manager, STA Resident, N.A. Car STA Manager and Purchasing Manager.



Process:

Supplier Design Issues

Steps 2 through 4 are the same.

STEP 5 • The IQ Engineer will be a member of the Change Management Team to review

the incoming Supplier engineering changes.

STEP 6

• The team will evaluate the risk regarding either Supplier performance and or complexity of the engineering change and decision if the Incoming Quality area will verify the engineering change through incoming inspection.

VO Quality Office

S. Brownell

March 5, 2001

Iqprocess.doc





Launch QOS Element 206 © 2004, Ford Motor Company. All Rights Reserved.

Ford ProprietaryPrinted copies are Uncontrolled.

Purpose:

Utilize a standardized process to ensure High Impact production supplier''s manufacturing processes are capable of producing parts that demonstrate capability to meet product specifications at required program milestones.

This process is also to be applied to Specialty Vehicles. Specialty Vehicles are vehicles designed outside the normal Base Model Product Development (PD) activities, such as but not limited to Exports, Alternative Fuel, and SVT vehicles. These programs will require a comprehensive review of STA staffing resources prior to engagement. If required, the Specialty Vehicle Program Team may be required to fund/support incremental STA headcount to meet program deliverables.

Overview:

The process shall include:

� Establish a partnership with High Impact suppliers identified by program PMT using input from STA activities, Product Design engineering, historical supplier data and Segmentation Model.

� Establishment of Ford Executive Champions (key personnel) assigned to HI Suppliers by the PST. (As Required)

� Conducting necessary Quality Stand downs for Supplier Operating Managers/CEO''s as necessary to reinforce Program Status and expectations. (As Required)

� Conducting Supplier Readiness Reviews at various program milestones that address issues such as design, quality, capacity, tooling, packaging, training, facilities and material handling to support the launch process.

STA and PD for Base Model and Speicialty Vehicle verify that High Impact suppliers are meeting the design and engineering intent through the following actions:

� Identifying/partnering with high risk suppliers - <SI> � Conducting Supplier Readiness Reviews to determine supplier capability and status - <PR> through <J1>� Reviewing supplier APQP status, identifying issues, and communicating issues to the program team -

<PR> through PSW � Ensuring Tier I suppliers have a robust quality plan for Tier II supply base including containment actions

during ramp up and Job #1.

STA verifies High Impact supplier processes have the potential to produce product meeting the PPAP requirements through the following actions:

� Conducting supplier Run @ Rate exercises at PPAP and Capacity Verification prior to Job #1 as proof of supplier''s capability and capacity. � 1PP through Job #1

Element: 206 Authors: Supplier Technical Assistance Title: Management of High Impact Suppliers QOS Group: Supplier Milestone Span:

<SI> - <J1>

Launch QOS

For FPDS Programs in the G region Ford Proprietary.

Element 206Online copy is an OFFICIAL RECORD

Page 1 of 4Launch QOS - Ford Proprietary: LQOS 206

3/24/2006http://www.vo.ford.com/cgi-bin/nmp/lqos3/lqos_display.pl



� Ensuring supplier has extraordinary containment actions in place for Job 1 and during ramp up.

Deliverables:

Measurables:

Contributors: Purchasing Vehicle Engineering Assembly Plant Safety Engineer

Reg Seq Timing DescriptionG 1 SI SI High Impact Suppliers Identified for Base Model and Specialty Vehicle (Refer to APQP Checklist 2 -

Expectation 3).

G EXECUTOR: Supplier Technical Assistance G 2 SC SC High Impact Suppliers Notified for Base Model and Specialty Vehicle. G EXECUTOR: Supplier Technical Assistance G 3 PH J1 High Impact Supplier APQP Status Reports for Base Model and Specialty Vehicle (Refer to APQP Checklist 2 -

Expectations 7,8,9)

G EXECUTOR: Supplier Technical Assistance G 4 CP J1 High Impact Supplier Launch Readiness Review; summary with back up documentation (Refer to APQP

Checklist 5 - Expectation 4,5,6,7,8,9,10,11,12).

G EXECUTOR: Supplier Technical Assistance G 5 LS J1 Capacity Verification at High Impact supplier facility for Base Model and Specialty Vehicle. G EXECUTOR: Supplier Technical Assistance G 6 SC SC Specialty Vehicle CNE and STA Director to determine expectations of STA's involvement. G EXECUTOR: Specialty Vehicle Engineering G EXECUTOR: Supplier Technical Assistance G 7 PH PA Obtain funding agreement for incremental STA resources required for Specialty Vehicles. G EXECUTOR: Specialty Vehicle Engineering G EXECUTOR: Supplier Technical Assistance

Reg Seq Timing DescriptionG 1 SI SI High Impact Supplier List - All HI Suppliers Identified for Base Model and Specialty Vehicle (Yes / No). G EXECUTOR: Supplier Technical Assistance G 2 SC SC High Impact Supplier List - All HI Suppliers Notified for Base Model and Specialty Vehicle (Yes / No). G EXECUTOR: Supplier Technical Assistance G 3 PH J1 PSW High Impact Supplier APQP Status for Base Model and Specialty Vehicle rated either: (R/Y/G). G EXECUTOR: Supplier Technical Assistance G 4 CP J1 Launch Readiness Review Status for High Impact suppliers for Base Model and Specialty Vehicle rated

either: (R/Y/G).

G EXECUTOR: Supplier Technical Assistance G 5 LS J1 High Impact Suppliers with Capacity Verification complete for Base Model and Specialty Vehicles - (%) G EXECUTOR: Supplier Technical Assistance G 6 SC SC Specialty Vehicle CNE and STA Director had determinee expectations of STA's involvement (Yes/No). G EXECUTOR: Specialty Vehicle Engineering G EXECUTOR: Supplier Technical Assistance G 7 PH PA Funding agreement obtained for incremental STA resources required for Specialty Vehicles (Yes/No). G EXECUTOR: Specialty Vehicle Engineering G EXECUTOR: Supplier Technical Assistance

Launch QOS







Assembly Plant Product Specialist Assembly Plant Launch Manager New Model Programs Launch Manager Chief Nameplate Engineer Design & Release Engineering Supplier Technical Assistance Product Creation Process Control Specialty Vehicle Engineering

References:

Scalability Application Matrix:

(R - Required, C - Consider, O - Optional, X - Not allowed, - - Invalid Combination)

Reg Description Title/URLG - APQP Status

Reporting Process & Selection of High Impact Suppliers - (STA Procedure PSW-009)

http://www.ctis.ford.com/sup_tech/secure1/data/11484988.pdf?C_1

G - Notifying High Impact Suppliers - (STA Guideline PSG-003)

http://www.eim1.ford.com/launchomatic/launch/view.jsp?chronicleId=09000c5180130401&docbase=edrdoc1C_2

G - Launch Readiness Reviews - (STA Guideline PSG-008)

http://www.eim1.ford.com/launchomatic/launch/view.jsp?chronicleId=09000c5180130418&docbase=edrdoc1C_3

G - Production Part Approval Process - (STA Procedure PSP-012)

http://www.ctis.ford.com/sup_tech/secure1/data/12058803.pdfC_4

G Capacity Verification - (STA Work Instruction PSW-003)

http://www.edrwas.ford.com/launchomatic/launch/view.jsp?chronicleId=09000c51801305be&docbase=edrdoc1C_5

G VOQO Specialty Vehicle QOS

http://www.vo.ford.com/departments/quality/qos/Assembly_QOS/Specialty_Vehicle_Launch_Readiness_QOS.docC_9

S-Scale P1 P2 P3 P4 P5 P6S1 O O O - - -S2 O O O O - -S3 R R R R R RS4 R R R R R RS5 R R R R R RS6 R R R R R R

Launch QOS







Revision History:

Date Updated By Approved By Description20-DEC-04 SKUSCH MMCCONVI CC# 1763 Revised to include Specialty Vehicles (skusch); also added Deliverables &

Measurables regarding STA's involvement in Specialty Vehicle programs (tmiller7).01-SEP-04 TWINTER4 MMCCONVI CC# 1811 Update element Contributors for rev 8.06-OCT-03 SSINGER1 RRAJAN CC# 1365 Narrowed scope to Management of High Impact Suppliers and corrected

Measureables and Deliverables. CC# 1450 Added "G" descriptor to element number to denote Globalized element (KROCKWE2).

08-JAN-02 GBIGGAR JROTH Integration of APQP into LQOS per CC 1271. (Revised by GBIGGAR, RDAVID2, MSCHLOSS).

12-MAR-01 MFUNNEL SKRUCHER Original Creation of the QOS Section

Launch QOS





1

Copyright © 2000-2004 Ford Motor Company. All rights reserved.

Sourcing for Quality

Module 1: Sourcing for Quality Overview & Process



Welcome to Sourcing for Quality

� The SFQ process…

– Ensures that Ford suppliers are of the highest quality

– By identifying suppliers with strong quality track records

Sourcing for Quality (SFQ) is a comprehensive quality

evaluation of a Supplier under consideration for new business

or resource of existing business.

Sourcing for Quality (SFQ) is a comprehensive quality

evaluation of a Supplier under consideration for new business

or resource of existing business.

The goal of this program is to provide you with a working

knowledge of the SFQ process and how it fits into the Global

Sourcing Stakeholders Meeting (GSSM) sourcing process.

The goal of this program is to provide you with a working

knowledge of the SFQ process and how it fits into the Global

Sourcing Stakeholders Meeting (GSSM) sourcing process.

2


SFQ Process Course Objectives

� Upon completion of this learning program, you will be able to

– Communicate with Ford personnel on future Supplier candidates

– Utilize SFQ tools to complete process requirements correctly

– Review/update an Electronic Early Sourcing Work Plan (e-ESWP)

– Review and interpret an Open Sourcing Matrix

– Complete a Sourcing Approach Assessment

– Validate a Supplier Quality Self-Evaluation (SQSE)

– Complete a Supplier Sourcing Quality Evaluation (SSQE)


SFQ Process Course Objectives, continued

� Upon completion of this learning program, you will be able to

– Complete an executive summary

– Apply the correct process for each type of sourcing strategy

– Identify the various Purchasing roles and responsibilities

– Recognize the tools & procedures used to make a sourcing decision

3


SFQ Process Course Overview

� This course is composed of three modules

– SFQ Overview and Process

– SFQ Competitive Quote Process and Responsibilities

– SFQ Pre-Sourcing Process and Responsibilities


SFQ Process Overview

� SFQ Process ensures quality as a prerequisite

– To awarding new business

– To re-sourcing existing business

� Links the sourcing process to Supplier performance history…

� …And to program risk assessment in two primary categories:

– Company/site quality

– Product quality

4


The Cost of Poor Quality

� Poor quality results in lost profit due to:

– Recalls

– Warranty issues

– Stop shipments

– And other quality issuesImproving quality is a cost-saving

opportunity!

Improving quality is a cost-saving

opportunity!


Evolution of the SFQ Process

Enhancements to the SFQ Process have been made over time. The process will continue to evolve in the future.

C1 ProcessC1 Process

Current Sourcing for

Quality Process

Current Sourcing for

Quality Process

Enhanced Sourcing for

Quality Process

Enhanced Sourcing for

Quality Process

e-Solution Sourcing for

Quality Process

e-Solution Sourcing for

Quality Process

5


Lessons Learned – What Worked?

Executive summary and quantitative conclusions with a consensed recommended supplier candidate provided

Final quality evaluations and conclusions provided

Quality evaluation criteria were unclear, and there was poor linkage between detailed evaluations and final conclusions

Enhanced SFQ ProcessCurrent SFQ ProcessNew Model C1 Process

Supplier’s site evaluation input is validated by STA responsible engineer

Suppliers provided input through self-evaluation/ site assessments based on clear quality criteria

Suppliers had no input

Candidate’s site evaluations are quantitatively stored

Evaluations completed by site and candidates compared relative to each other

Site level evaluations were not always achieved

Continuous ImprovementWhat Needed Improvement


The sourcing process will ultimately become an e-Solution,

making quality data more accessible.

The sourcing process will ultimately become an e-Solution,

making quality data more accessible.

Where the Process is Going

� More accessible data will improve:

– Sourcing decisions

– Analysis of data & quality tendencies of the commodity supply base

– Leverage of existing data for new business solutions

– Application of data to future programs

– Reduce Engineer workload

� The data will be globally accessible within Ford Brands

6


What these Enhancements will Accomplish

Site assessments will be more comprehensive, and expanded to include

Supplier technology & program risk

Sourcing will be more data-driven, utilizing a defined and weighted scoring process

The sourcing process will be more user-friendly


Benefits of Enhanced Sourcing for Quality

Customers will see improved quality and cost

Customers will see improved quality and cost

Suppliers will have a clear understanding of Ford’s

quality expectations

Suppliers will have a clear understanding of Ford’s

quality expectations

Assembly plants will have a stronger supply base

Assembly plants will have a stronger supply base

Strategic Commodity Teams and TVM will have consistent

supply base evaluations across vehicle lines

Strategic Commodity Teams and TVM will have consistent

supply base evaluations across vehicle lines

STA and Buyers will have improved data sharing

STA and Buyers will have improved data sharing

Commodity Global Council Teams will have global Supplier quality review

package

Commodity Global Council Teams will have global Supplier quality review

package

7


SFQ Process Overview

Company/Site Quality

� General business indicators

� Q1 Mfg Site Assessment

� Mfg risk to program

Product Quality

� Customer satisfaction data

� Quality

� Performance

The SFQ Process ensures quality as a prerequisite to awarding new

business and resourcing existing business. It links the sourcing process to

Supplier performance history and risk assessment in two categories:

The SFQ Process ensures quality as a prerequisite to awarding new

business and resourcing existing business. It links the sourcing process to

Supplier performance history and risk assessment in two categories:


Overview of the FPDS/GSSM Timeline

8


How the SFQ Process Fits In


How the SFQ Process Fits In

Suppliers are evaluated for

quality at this point on the

FPDS/GSSM timeline.

This period is approximately 15 weeks in length.

9


The Enhanced SFQ Process Timeline



10





11



Module 2: Competitive Quote Roles, Tools, & Responsibilities



Module Overview & Objectives

� In this module, you will learn to:

– Employ tools and procedures for making a Competitive Quote sourcing

decision

– Review, update, and interpret an e-ESWP & Open Sourcing Matrix

– Complete a Sourcing Approach Assessment and validate an SQSE

– Complete a Supplier Sourcing Quality Evaluation (SSQE) and Executive

Summary

This module will discuss the roles, responsibilities, tools, and

templates used to facilitate the Sourcing for Quality Process.

This module will discuss the roles, responsibilities, tools, and

templates used to facilitate the Sourcing for Quality Process.

12


Print Support Documentation

Please print the

Competitive Quote Process

Workflow at this time.

Please print the

Competitive Quote Process

Workflow at this time.

� This module will be easier to

follow if you print the Process

Workflow document

� The course will pause when you

click the link below

� When you’re ready, click the Play

button beneath the video to

continue


The Competitive Quote Process Workflow

13





14




Relevant Tools and Documentation

Other relevant tools and documentation:

•Open Sourcing Matrix (OSM)

•Electronic Early Sourcing Work Plan (e-ESWP)

•Supplier Improvement Metrics (SIM) Data

•Sourcing Approach Assessment (SAA)

•Supplier Quality Self-Evaluation (SQSE)

•Q1 Manufacturing Site Assessment (MSA)

•Sourcing for Quality Guidelines

•Supplier Sourcing Quality Evaluation & Executive Summary (SSQE)

•Sourcing Consensus Documentation

•GSSM Checklist

•Global Sourcing Website

15


How Tools and Documentation are Linked

� Tools and documentation build upon and feed into each other

� Ultimately leading to the Sourcing Consensus Document

Tool

ToolTool

Tool

Tool


The Sourcing Consensus Document

� The Sourcing Consensus Documentation (or GSSM Binder) is

compiled by the Buyer and made available to purchasing

management

� The SSQE makes up the Quality Assessment section

� In addition to Quality Assessment, the Binder contains:

– Program background information

– Commercial/technical assessments

16


GSSM Binder StructureSourcing Consensus Document (GSSM Binder) Structure

1.Sourcing Recommendation and Approvals

Summary of items 2-5

Questions and AnswersIterative Process

Commodity-Specific Request for QuotationProgram background, SSQE, Commercial requirements including the Commercial Principles, technical requirements

2.Program Background

Timing, volume, supply base impact

3.Quality

AssessmentSSQE

4.Commercial AssessmentLife cycle, NPV, final offer

summary, explanation of variances

5.Technical

Assessment

Final OfferSupplier 1

Quality, commercial,

technical



technical



technical

Initial QuotationSupplier 1


technical



technical



technical

Quo

tatio

n S

umm

ary

Quo

tatio

n P

roce

ss: I

tera

tive


Competitive Quote Step 1: e-ESWP

� Purchasing Project Manager (PJM) initiates e-ESWP

� Updates GSSM per brand/vehicle at Kickoff (<KO>)

� e-ESWP is used to initiate a Competitive Quotation

� Click button below to visit the e-ESWP site

– (specific access may be required, contact your supervisor)

� Site includes a comprehensive tutorial

1.Initiate e-ESWP and

update for GSSM


update for GSSM

17


Competitive Quote Step 2: Open Sourcing Matrix

� Initiated and maintained by PJM

� Open Sourcing Matrices are Excel spreadsheets generated or

downloaded from the e-ESWP

� Data from the e-ESWP feeds into the OSM

� The OSM lists components and Suppliers under consideration

2.Initiate and maintain

OSM


OSM


Competitive Quote Step 3: Sourcing Strategy

� Buyer defines sourcing strategy in OSM

– Competitive Quote

• Market Test (MT)

• Design Competition (DC)

• Online Quote (OLQ)

3.Define Sourcing Strategy

in e-ESWP (OSM)


in e-ESWP (OSM)

18


Competitive Quote Step 4: STA Review

� Review OSMs to forecast upcoming vehicle sourcing decisions

requiring sourcing for quality evaluations

4.Assigned STA Person

review OSMs


review OSMs


Competitive Quote Step 5: OSM Review

� Review OSM Candidate List

� Consider criteria listed in Sourcing Approach Assessment (i.e.,

Q1, Warranty, Launch QRs, etc.)

5.Review OSM per SAA

criteria

5.Review OSM per SAA

criteria

19


Competitive Quote Step 6a/b: Candidates

� STA and Buyer agree on Supplier candidate(s) based on assessment

criteria from SAA

– e.g., Q1 revoke, to eliminate unsatisfactory quality Suppliers from OSM

� Buyer updates OSM if the list of Supplier candidate(s) has changed

6a.Agree on Supplier

candidate(s) with Buyer

6a.Agree on Supplier

candidate(s) with Buyer

6b.Agree on candidate(s) with STA and update

OSM

6b.Agree on candidate(s) with STA and update

OSM


Competitive Quote Step 7: SAA/OSM Approval

� STA Commodity Manager and Purchasing

Commodity Manager (regional) review and

approve OSM

7.Review and approve

SAA/OSM

7.Review and approve

SAA/OSM

20


Competitive Quote Step 8: GSSM Step 1

� Buyer and Purchasing Director review and obtain approval from

GSSM in Step 1

� Buyer reviews and obtains sourcing strategy approval in the GSSM

Step 1 meeting

8.GSSM Step 1

Review and approve OSM

8.GSSM Step 1

Review and approve OSM


Competitive Quote Step 9: Initiate Quotes

� Buyer initiates Competitive Quote Package

� Including blank SQSE/MSA forms to be sent to OSM Supplier candidate(s)

� Buyer must set a due date

9.Initiate Competitive

Quote Package to OSM Supplier candidate(s). Include SQSE/MSA

9.Initiate Competitive

Quote Package to OSM Supplier candidate(s). Include SQSE/MSA

21


Competitive Quote Step 10a: Prepare SQSE/MSA

� Upon receipt of package, Supplier will prepare and complete SQSE/MSA

� If MSA already exists and is…

– Within 6 months for Segment 1/2 Suppliers or 12 months for 3/4 Suppliers

� …Supplier will attach current copy to Buyer

� MSA includes action plan (as appropriate)

10a.Prepare SQSE/MSA

10a.Prepare SQSE/MSA


Competitive Quote Step 10b/c: Site Strategies

� Buyer and STA discuss necessary site visits

� Schedule joint visits as needed

10b/c.Determine Site

Assessment Strategy

10b/c.Determine Site

Assessment Strategy

22


Competitive Quote Step 11a/b: Receive/Submit

� Supplier submits SQSE/MSA as part of the competitive

quote package/ Buyer verifies receipt


11a.Submit SQSE/MSA

11a.Submit SQSE/MSA

11b.Receive SQSE/MSA

11b.Receive SQSE/MSA


Competitive Quote Step 12: Supplier Selection

12.Select Supplier from Competitive Quote

12.Select Supplier from Competitive Quote

� Buyer selects Supplier from Competitive Quote

23


Competitive Quote Step 13: SQSE/MSA to STA

13.Send selected Supplier

SQSE/MSA to STA


SQSE/MSA to STA

� Buyer sends selected Supplier SQSE/MSA to STA


Competitive Quote Step 14: Schedule GSSM


SQSE/MSA to STA


SQSE/MSA to STA

� Buyer/PJM schedules GSSM Step 1 date

– In 10 business days before Buyer filing for Q1 Suppliers

– In 20 business days before Buyer filing for Non-Q1 suppliers

� See Appendix A for details

24


Competitive Quote Step 15a: Receive & Validate

� STA receives selected supplier MSA/SQSE from Buyer and validates SQSE/MSA

15a.Receive and validate

selected Supplier


selected Supplier


Competitive Quote Step 15b: On-site Assessment

15b.On-site Assessment and

Action Plan


Action Plan

� STA conducts onsite MSA as required (Local STA Practice)

25


Competitive Quote Step 16: Generate SSQE

16.Generate SSQE

16.Generate SSQE

� STA generates SSQE by inputting validated data from SQSE/MSA


Competitive Quote Step 17a/b: Agreement

� STA and Buyer review SSQE and agree on selected

competitive quote Supplier

� If an agreement is not reached, return to Step 12

17b.Agree on selected

Supplier

17b.Agree on selected

Supplier

17a.Obtain agreement from

Buyer

17a.Obtain agreement from

Buyer

26


Competitive Quote Step 18a/b/c/d: Cadence Reviews

� Buyer and STA review agreement in Pre-GSSM meetings

� STA/Purchasing pre-GSSM Cadence Reviews (local STA practice)

18a/b.Review agreement in pre-

GSSM Meeting

18a/b.Review agreement in pre-

GSSM Meeting

18c.Review in pre-GSSM


18d.Concur the STA decision

18d.Concur the STA decision


Competitive Quote Step 19: Proforma Filed

19.GSSM Sourcing

Consensus Proformafiled

19.GSSM Sourcing

Consensus Proformafiled

� Buyer files GSSM Sourcing Consensus Proforma (including SSQE)

27


Competitive Quote Step 20: Pre-GSSM Review

20.Review in pre-GSSM


� STA Executive Director Pre-GSSM meeting

(STA Executive Pre-GSSM Cadence Review)


Competitive Quote Step 21: GSSM Step 2

21.GSSM Step 2

Obtain approval

21.GSSM Step 2

Obtain approval

� Buyer obtains sourcing decision approval during GSSM Step 2

� Refer to GSSM web page for all proprietary requirements for GSSM

28


Competitive Quote Step 22a/b: Sign-off

22a/b.Sign-off Sourcing

Agreement with SSQE work plan



� CBG/Central Buyer and Supplier sign-off Sourcing Agreement that includes

any quality action plans in the SSQE

� STA to use Q1 process to verify Supplier’s implementation plan


In Summary

� The SFQ Process

– Is a thorough quality evaluation of a Supplier by Purchasing

– This evaluation is conducted when awarding new business or

resourcing existing business

� The qualitative SSQE analysis document

– Works as a communication tool between STA and Buyers

– Assists in building consensus on high-quality Supplier candidates

29



Module 3: Pre-Source Roles, Tools, & Responsibilities



In the previous module, we examined the workflow process for

competitive quote activities. This module completes the workflow

discussion by introducing you to the pre-source process.

In the previous module, we examined the workflow process for

competitive quote activities. This module completes the workflow

discussion by introducing you to the pre-source process.

Module Overview & Objectives

� In this module, you will learn to:

– Employ tools and procedures for making a pre-sourcing decision

– Address late notification in the sourcing decision

– Review, update, and interpret an e-ESWP & Open Sourcing Matrix

– Complete a Sourcing Approach Assessment

– Complete/validate a Supplier Sourcing Quality Evaluation (SSQE)

– Write an Executive Summary

30


The Pre-Source Process Workflow



31





32


General Roles and Responsibilities

� Purchasing Project Manager (PJM)

� Commodity Buyer

� STA Engineer


Pre-Source Step 1: e-ESWP


update for GSSM


update for GSSM

� Purchasing Project Manager (PJM) initiates e-ESWP

� Updates GSSM per brand/vehicle at Kickoff (<KO>)

� Click button below to visit the e-ESWP site

– (specific access may be required, contact your supervisor)

� Site includes a comprehensive tutorial

33


Pre-Source Step 2: Open Sourcing Matrix

� Initiated and maintained by PJM

� Open Sourcing Matrices are Excel spreadsheets generated or

downloaded from the e-ESWP

� Data from the e-ESWP feeds into the OSM

� The OSM lists components and Suppliers under consideration,

along with other relevant data


OSM


OSM


STA Interaction with the OSM

� The STA Engineer looks at the following information in the

Open Sourcing Matrix:

– Sourcing Approach

– Suppliers Under Consideration

– Manufacturing Code

34


Pre-Source Step 3: Define Sourcing Strategy

� Buyer defines sourcing strategy in OSM as Pre-Sourced with STA input


in e-ESWP (OSM)


in e-ESWP (OSM)


Pre-Source Step 4: STA Review

� Review OSMs to forecast upcoming vehicle pre-sourcing

decisions requiring sourcing for quality evaluations


review OSMs


review OSMs

35


Pre-Source Step 5: Send Documents to Suppliers

� Buyer sends blank SQSE/MSA forms to Pre-sourced Supplier

� Buyer provides expected due date


5.Send out SQSE/MSA to

Pre-source Suppliers

5.Send out SQSE/MSA to

Pre-source Suppliers


Pre-Source Step 6a: Prepare SQSE/MSA

� Supplier to prepare and complete the SQSE/MSA upon receipt

� If MSA already exists and is…

– Within 6 months for Segment 1/2 Suppliers or 12 months for 3/4 Suppliers

� …Supplier will attach current copy to Buyer


6a.Prepare SQSE/MSA

6a.Prepare SQSE/MSA

36


Pre-Source Step 6b & 6c: Site Assessment

� Buyer and STA discuss necessary site visits

� Schedule joint visits as needed

6b/c.Determine Site

Assessment Strategy

6b/c.Determine Site

Assessment Strategy


Pre-Source Step 7a: Submit SQSE/MSA

� Supplier submits SQSE/MSA to Buyer when completed


7a.Submit SQSE/MSA

7a.Submit SQSE/MSA

37


Pre-Source Step 7b: SQSE/MSA Go to STA

� Buyer records SQSE/MSA submission and sends a copy of both to

STA for validation (Local STA Practice)


7b.Receive SQSE/MSA and

send to STA

7b.Receive SQSE/MSA and

send to STA


Pre-Source Step 8: GSSM Step 1 Meeting

� Buyer/PJM schedule GSSM Step 1 in 2 weeks (for Q1 Suppliers)

– 10 business days before Buyer files pre-source to GSSM Agenda

� Buyer/PJM schedule GSSM Step 1 in 4 weeks (non-Q1 Suppliers)

– 20 business days before Buyer files pre-source to GSSM Agenda


8.Schedule GSSM Step 1

Meeting

8.Schedule GSSM Step 1

Meeting

38


Pre-Source Step 9a: Receive SQSE/MSA

� STA receives and validates SQSE/MSA



SQSE/MSA


SQSE/MSA


Pre-Source Step 9b: Site Assessment

� STA conducts On-site Assessment as required (local STA practice)


Action Plan


Action Plan

39


Pre-Source Step 10: Generate SSQE

� STA generates SSQE by inputting the validated data from SQSE and MSA

10.Generate SSQE

10.Generate SSQE


Pre-Source Step 11a/b: Agree on Supplier

� STA and Buyer agree on Pre-Source selected Supplier

� If an agreement is not reached, return to Step 3

11a.Obtain Agreement from

Buyer

11a.Obtain Agreement from

Buyer

11b.Agree on Pre-source

selected Supplier

11b.Agree on Pre-source

selected Supplier

40


Pre-Source Step 12a/b/c/d: Agreement Review

� Buyer and STA review agreement in

pre-GSSM meeting

� STA/Purchasing pre-GSSM Cadence

Reviews


12a.Review agreement in pre-GSSM meeting with STA

12a.Review agreement in pre-GSSM meeting with STA

12d.Concur STA decision

12d.Concur STA decision

12b.Review agreement in pre-

GSSM meeting with Buyer

12b.Review agreement in pre-

GSSM meeting with Buyer




Pre-Source Step 13: File Pre-Source

� Buyer confirms Pre-source to GSSM agenda

13.Buyer confirms (files) Pre-source to GSSM

agenda

13.Buyer confirms (files) Pre-source to GSSM

agenda

41


Pre-Source Step 14: Pre-GSSM Review

� STA Executive Director pre-GSSM Meeting

� STA Executive pre-GSSM Cadence Review





Pre-Source Step 15: Approval

� Buyer obtains sourcing decision approval during GSSM Step 1 with

Purchasing Directors

� Refer to GSSM Website for process details

15.GSSM STEP 1Obtain Approval

15.GSSM STEP 1Obtain Approval

42


Pre-Source Step 16a/b: Sign-off

� CBG/Central Buyer and Supplier sign-ofs Sourcing Agreement that include

any quality action plan in the SSQE

� Use Q1 process for Suppliers implementation plan (two step assignment)






In Summary

� The SFQ Process

– Is a thorough quality evaluation of a Supplier by Purchasing

– This evaluation is conducted when awarding new business or

resourcing existing business

� The qualitative SSQE analysis document

– Works as a communication tool between STA and Buyers

– Assists in building consensus on high-quality Supplier candidates

Road to Enhanced Sourcing for Quality

What Worked? Continuous Improvements

• Improved quality emphasis at the sourcing decision � Emphasizes quality � Prioritizes quality at the sourcing decision

• Highlighted quality issues ahead of the sourcing decision

� Cadence review of quality issues with management � Quantitative rating of quality issues reviewed cross-functionally

• Proactive participation by STA in the sourcing process � STA quality evaluations reviewed prior to <SI> (Strategic Intent)

� STA to follow GSSM Forecast/Cycle Plan and e-ESWP to plan quality evaluations

• Open dialogue between the Buyers and STA � Open dialogue structured around GSSM cadence reviews

� Open dialogue begins earlier in the e-ESWP/PAT work plan stage reviewing new, modified, and carryover commodities

What Needed Improvement? Continuous Improvements

• Site level evaluations were not always achieved � Evaluations completed by site and candidates compared relative to each other

� Candidates site evaluations are quantitatively scored

• Suppliers had no input � Suppliers provided input through self-evaluation/site assessments based on clear quality criteria

� Suppliers self-evaluation input is validated by STA responsible Site Engineer

• Quality evaluation criteria was not clear, and there was poor linkage between detailed evaluations and final conclusions

� Final quality evaluations and conclusions provided � Executive summary and quantitative conclusions with a consensed recommended Supplier candidate provided

• Quality evaluations did not align with Q1 2002 requirements

� Quality evaluations aligned with Q1 2002 requirements

� Quality evaluations aligned with Q1 2002 requirements

• Not uniformly applied across commodities and global brands

� Not consistently applied across global brands � Globally developed and consistently applied across global brands

• Evaluations resided with individual Engineers – not shared

� Evaluation is shared but resides with an individual Engineer

� Shared evaluations will be archived in a global EKB

• STA Engineers and Buyers were not adequately trained on how to complete evaluations

� STA Engineers not uniformly trained � STA/Commodity Buyers will be trained globally

��

��

�� !" � #

�� $ % " #& '�$

( ) � " !* +$ � % �, ,

Open Sourcing Matrix

Legacy Sourcing (Incumbent Supplier) Sourcing Approach Expected Benefits from Sourcing Strategy and Proposed Supplier(s)

Subsystem / Component Description

Estimated Annual

Value (USD mils)

Estimated Cumulative Life Cycle (6 years)

Value (USD mils)

Required Supplier

"On-Board" Date

GSSM Review Date of

Sourcing Approach

Date of GSSM

Consensus Review

Delegation of

Authority Satisfied

(Date)

Buyer and Manager Name Who Will be Preparing the Sourcing Recommendation

Package

Desired Sourcing Pattern and/or

Design Commonality

S197 D/EW98

Suppliers Under Consideration Note if supplier to: T = Toyota; H = Honda

and/or N = New Supplier and Mfg. Site Codes

Design Competition, Market Test, Pre-Source or On-Line Quote

(If appropriate)

Purchasing Commodity

Director

Powertrain

Transfer Case $XX.XX $XX.XX 5/21/20025/2/02 D2M 10/4/01(A) D2E AWD

NR J. Doe/X. Brown New NA NA(D2M) Supplier A(DRE) Supplier A

(D2M) Presource with a Target(D2E) Presource with a Target

(D2M) D2M - rationale for pre-sourcing the t/case is consistent with previous review at GSSM for D2C. Package constraints require a grea-driven case. Supplier A has the most experience in gear-driven cases, and is the present supplier of the gear driven case on E320/E430. Total integration of

the AWD system. Ford and Supplier A will jointly determine the suppliers for components not manufactured by Supplier A. Chassis and PTO purchasing will jointly ensure that suppliers are

common between the RWD and AWD driveshafts and halfshafts to the greatest extent possible.

(D2E)Total integration of the AWD system. Ford and Supplier A will jointly determine the suppliers for components not manufactured by Supplier A. Chassis and PTO purchasing will jointly ensure that suppliers are common between the RWD and AWD driveshafts and halfshafts to the greatest

extent possible.

Y. Roth

Chassis

Rear Drive IRS Axle $XX.XX $XX.XX

8/1/02 (12/11/01) (07/20/01) (06/18/01) (05/22/01) (03/16/01)

5/2/02/02 D2M 10/4/01D2E (02/01/01)(A)

D2C

NR Y. Green /Z. Jones

Supplier B retained as

source (Supplier B met S197

Last Right of Refusal request)

Supplier B

(D2M) Supplier B (D2C)Supplier C, Supplier D, Supplier E, Supplier F. Supplier B does not have BIC

light wgt. Al. product to offer.

(D2M)Presource all AWD/RWD F236 and D365 rear axles to Supplier B.

(D2C)Design competition if S197 Supplier B. Otherwise c/o S197.

(D2M) Leverage Legacy Sourcing with Supplier B (D2E) BIC light weight axle design, gear mfg, & economies of scale.

(D2C) BIC light weight axle design, gear mfg, & economies of scale if common with S197. Supplier B on Q1 probation as of 1/10/01.

Z. Stevens

Front Driveshaft $XX.XX $XX.XX 8/1/2002 5/2/02 D2M TBD X. Smith/Z. Jones New NA NA (D2M ) Supplier E, Supplier G, Supplier H, Supplier B

(D2M) Design Competition (D2M) BIC Imbalance/Runout/Articulation torque with minimized weight and cost Z. Stevens

Front Drive Halfshaft $XX.XX $XX.XX 8/1/2002 5/2/02 D2M TBD X. Smith/Z. Jones New NA NA (D2M ) Supplier I(H), Supplier J(N), Supplier G(T, H), Supplier K(N)

(D2M) Design Competition (D2M) Minimize weight and cost of shudderless CVJ designs. Z. Stevens

Rear Drive Halfshafts $XX.XX $XX.XX

8/1/02 (10/16/01) (07/20/01) (06/18/01) (05/22/01) (03/16/01)

5/2/02 D2M 10/4/01(A) D2E (02/01/01)(A)

D2C

NR X. Smith/Z. JonesTBD. Market

Test in progress.

NTN(D2M) Supplier I(H)

(D2E) Supplier G (T), Supplier I (H), Supplier B, Supplier J (N)

(D2M) Presource to Supplier I, LS legacy source (D2E) Co-manage design competiton/source selection process with Supplier A. Goal is to commonize AWD/RWD driveshaft sourcing.

(D2M) Strong supplier experience on LS program. Supplier has a strong history of quality and reliability. Carryover designs.

(D2E)BIC Constant Velocity joint designs. Minimize weight and cost, and improve NVH characteristics (minimize joint lash and maximize stiffness).

Z. Stevens

Rear Driveshaft $XX.XX $XX.XX

8/1/02 (10/16/01) (07/20/01) (06/18/01) (05/22/01) (03/16/01)

5/2/02 D2M 10/4/01(A) D2E (02/01/01)(A)

D2C

NR X. Smith/Z. Jones Supplier B Supplier B(D2M) Supplier B

(D2E)Supplier B, SupplierE, Supplier H, Supplier G, Supplier L

(D2M) Presource to Supplier B, LS legacy source (D2E) Co-manage design competiton/source selection process with Supplier A. Goal is to commonize AWD/RWD driveshaft sourcing.

(D2M) Supplier experience on LS program. Driveshaft has low imbalance and runout. (D2E)BIC cost, weight and performance (lowest driveshaft imbalance and runout). Supplier B on

Q1 probation as of 1/10/01.Z. Stevens

Front Stabilizer Bar(incl. insul) $XX.XX $XX.XX

8/1/02 (12/11/01) (08/30/01) (06/19/01) (04/12/01)

5/2/02 D2M 02/08/01(A)

D2CTBD Y. Adams/X. Howard Supplier B Supplier B

(D2M) Sta Bar assy pre-sourced to Supplier M with Supplier B to provide the bar

(D2C) Supplier N, Supplier O, Supplier B, Supplier P

(D2M) Presource to Supplier M with c/o LS cost target

(D2C)Market TestCost leverage Z. Stevens

Interior

IP/Cockpit $XX.XX $XX.XX

5/21/02 (10/16/01) (07/20/01) (06/18/01) (05/22/01)

5/2/02 D2M 3/29/01(A)

D2C (02/01/01)

NR (D2M) 10/4/01 (A)

D2EZ. Arnold/X. Taylor

(D2M) Legacy source (D2C) Establishh new Lincoln source

Supplier B Supplier B

(D2M) Supplier B (D2C)Supplier J(N), Supplier Q(N), Supplier

R, Supplier T, Supplier T,Supplier U, Supplier V

(D2M) Presource to Supplier B, LS legacy source per separation agreement (D2C)Design Competition

(D2M) Program management will not pursue resourcing as it poses significant risk to program timing. (Core Purchasing recommended.) D310/D341 learnings were used to establish D2M craftsmanship/pricing targets and will be leveraged to close approximate $XX.XX gap to target

(based on Supplier B F236 premium content proposal.) (D2C)Better cost and craftsmanship performance

Y. Allen

Sourcing data for D2C and D2E are denoted when the change in platform affected the sourcing approach.

Sourcing Consensus

Sourcing Approach to be Reviewed on 5/2/02

c:\crowlan1\Open Sourcing_F236/D365_GSSM_050202_All.xls 1 of 3

Date Created: 1/3/2001Date Updated: 6/22/2006




Estimated Annual

Value (USD mils)


Value (USD mils)

Required Supplier

"On-Board" Date

GSSM Review Date of

Sourcing Approach

Date of GSSM

Consensus Review

Delegation of

Authority Satisfied

(Date)


Package


Design Commonality

S197 D/EW98




(If appropriate)


Director


Sourcing Consensus






Estimated Annual

Value (USD mils)


Value (USD mils)

Required Supplier

"On-Board" Date

GSSM Review Date of

Sourcing Approach

Date of GSSM

Consensus Review

Delegation of

Authority Satisfied

(Date)


Package


Design Commonality

S197 D/EW98




(If appropriate)


Director


Sourcing Consensus



Notes:1) A Technical Assessment Pro forma is not available2) This pictorial intends to depict that each of the suppliers considered in the original inquiry would submit a

final offer. Selective re-bidding (defined as exclusion of any of the suppliers included in the original inquiry)requires one higher level of approval authority than normally required but not higher than the head of thePurchasing activity as per the Purchasing Authorities Guide - Purchase Agreements and Sales Agreements.

Quo

tatio

n P

roce

ss:

Itera

tive

Quo

tatio

n S

umm

ary

Sourcing Consensus Documentation - OverviewThe following pictorial represents the contents of the GSSM Sourcing Consensus "binder". Quotation Summary materials should be provided to all GSSM participants via e-mail. This workbook contains the pro formas for all areas but the Technical Summary.

2Program

Backgroundtiming, volume,

supply base impact

3Quality

Assessment SSQE

4Commerical Assessmentlife cycle, NPV, final offer summary, explanation of

variances

5Technical

Assessment

1Sourcing

Recommendation and Approvals

Summary of items 2 through 5

Final Offer Supplier 1

QualityCommercial Technical





Questions and Answers Iterative Process



Initial Quotation Supplier 2


Initial Quotation Supplier 3


Commodity Specific Request for QuotationProgram Background, SSQE, Commercial Requirements including the Commerical

Principles, Technical Requirements

03 consensus_proforma_sample.xlsOverview

Created: 02/12/02Updated: 04/03/02

Tab 1 Sourcing Recommendation and Approvals

Tab 2 Program Background

Tab 3 Quality Assessment

Tab 4 Commercial Assessment

Tab 5 Technical Assessment

Tab 6 Supplier, Signed Final Quotation Offers

Tab 7 Commodity Specific Request for QuotationFor each area: Quality, Commercial and Technical

Sourcing Consensus DocumentationTable of Contents

03 consensus_proforma_sample.xlsBinder Table of Contents Created: 04/03/02

Program Background

Brief program summary and expected supply base impact as a result of this recommendation.

Quality Assessment Summary

Enter recommended supplier's quality performance, both historical and what is anticipated for this project, from the SSQE.

Commercial Assessment Summary

Summary of the final offer summary and life cycle costs.

Technical Assessment SummaryIn addition to a summary of the attached technical assessment, Identify whether or not a Statement of Work (SOW) has been developed. If the SOW has not been developed indicate when this will occur and the status.

APPROVALS (Millions of US Dollars) Per the Purchasing Authorities Guide

Global Council Review and Approval Date:GSSM Approval Date (if required):

Insert names associated with this sourcing decision directly above their titles in the spaces below.

Other Acknowledgement Signatures

Sourcing Consensus DocumentationRecommendation and Approvals

(Supplier Name ) is the recommended supplier for the (commodity name ) on the (program or platform code ). Following is a summary of the data submitted in support of this recommendation for approval.

_________________

Buyer($0.5 million)

__________________

Purchasing Specialist($1 million)

__________________

Commodity Supervisor($3 million)

__________________

Purchasing Manager($6 million)

_____________________

Purchasing Manager (PSR)/PTO Director($30 million)

_________________

Director/PTO Global Director($60 million)

_____________________

Executive Director/VP European Purchasing Operations/Brand Chairman& Chief Executive (Unlimited)

_____________________

Vice President, Global Purchasing (Unlimited)

_________________STA Director

__________________ __________________ _____________________

03 consensus_proforma_sample.xls, Recommendation & Approvals Tab 1


Quotation and Program DataProgram or Platform Name: Sourcing Required DateCommodity Name: Quote DatePart or System Description: Response Due DatePart Number(s): (Identify if part is a Safety part) Final Offer Date (signed)Is Sourcing for a Platform, Brand or Powertrain architecture?Design or Surrogate Level (if available):Statement of Work Level Provided (e.g., surrogate, generic, complete)

Full Service Supplier Required?(Yes or No)

Sourcing Approach (Design Competition, Market Test, OLQ):

Sourcing TeamLead Buyer _____________ PMT Leader MP&L: _______________________

CBG AffectedCBG BuyerProgram STA Engineer

Sourcing Recommendation * Data marked with an asterisk in the section below is to be obtained from the Purchasing Program Manager.Timing /Quote Assumptions

Program 1 Program 2 Program 3 Program 4 … Pgm. N TotalDesign & Development SupplierLocation of Engineering CenterManufacturing SupplierReplaced Program *Incumbent Supplier on Replaced Program

Sourcing Council Approval Achieved?<SI> Milestone Date *<SC> Milestone Date *<PA> Milestone Date*Job #1 Date *Program Cycle Life (yrs.) *Using Ford Plant *CBG or Brand Affected *Annual Program Volume (Cycle Avg.) *Delivery Terms (FOB point) *Packaging (returnable or expendable)ILVS (yes or no)Shipping Mode (e.g., truck)

Supply Base Impact

Considerations:o Sourcing council issues that either mandate sourcing to a non-competitive supplier OR Sourcing Council Approval status, if applicable o Incumbent supplier for the part, whether or not they participated and the resulto Why all suppliers in the base were not quoted for these partso Whether or not the recommended supplier is in the strategy as preferred, and, if not, why are they being recommendedo Impact of the proposed sourcing strategy to each supply base (Ford, Volvo, Land Rover, Jaguar, Mazda, AAI)o Strategic reasons why a particular supplier is being sourcedo Potential supply base consolidation that could impact this recommendationo Complications that could arise from sourcing the recommended suppliero Identify potential support/ resource issues with sourcing of this business given the suppliers' other OEM commitmentso What commercial, technical and/or customer satisfaction improvement(s) is the sourcing expected to achieve based on the recommended suplier's final offer?

Is this sourcing recommendation in line with the current global commodity strategy resident in the Global Supplier Data Base (GSDB)? If not, what is the timing for an update to GSDB in line with this recommendation if appropriate?

Sourcing Consensus DocumentationProgram Background

Change to Annual Value of Business for current supplier (USD) with Ford

03 consensus_proforma_sample.xlsBackground Tab 2 Updated: 04/15/02

Supplier Site Quality Evaluation - Quality DataProgram: #REF! Design Responsibility (Ford or Supplier): Model Year: Benchmark Vehicles: Commodity: #REF! Benchmark Component Supplier:

Background Company name/Site Company A-Location Company B-Location Company C-LocationQuality SegmentationBusiness Unit/Parent Ranking X out of XX X out of XX X out of XXParticipation in warranty sharing Y or N Y or N Y or NFSS Recognized #REF! #REF! #REF!Site Experience with Commodity X Years X Years X YearsSite OEM Customers Six Sigma Experience Automotive Quality Awards NHTSA Involvement Y or N Y or N Y or NSite 5 yr. Committed Bus. (% capac.) XX% XX% XX%

Q1 Status Q1 Score (out of 1,000 points)

I. Customer Satisfaction Company A-Location Company B-Location Company C-LocationWarranty CPU (3 month) Warranty CPU (12 month) Warranty CPU (36 month) R/1000 (3 month) R/1000 (12 month) R/1000 (36 month) TGW (12 month) TGW (36 month) Reliability Demonstration * Variability Reduction Demonstration * II. Manufacturing Risk New People, Plant, Product, Process III. Quality PerformanceNumber of Field Actions (24 month)

Number of Stop Ships. (12 month)

PPM (12 month average)PPM (3 month average) PPM (Commodity average)

Number of Launch Issues (24 month)

PSW Slips (24 month)

Delivery (12 month average)FCSD Del. (12 month average)IV. Quality Capability *FMEA/Control Plan

PPAP

Tier II Quality Management

P.M./Housekeeping

Problem Solving

Lean Performance Relative Quality Ranking

* Legend: Excellent Evidence indicates excellent supplier capability.Acceptable Evidence indicates acceptable supplier capability.

Poor Evidence indicates poor supplier capability.Note: Boxed items indicate best in category.

Suppliers Being Evaluated

Sourcing Consensus Documentation

03 consensus_proforma_sample.xlsQuality, sheet 1 Tab 3 Updated: 10/29/01

Supplier Site Quality Evaluation - Conclusions

Supplier SiteOverall Assessment (Assessment of this site and Parent Company based on the Quality Data Summary and other known factors)

Relative Strengths (Comparison of this Company's strengths to other candidates)

Relative Weaknesses (Comparison of this Company's weaknesses to other candidates)

Required Next Steps/Conditional Approval (For conditional "yes" approval, discuss what is required (e. g., site visit, specific training, etc…)

Overall Assessment Relative StrengthsRelative Weaknesses

Overall Assessment Relative StrengthsRelative Weaknesses

Company C Name-Location

Y or N 3

STA Supports Sourcing

Relative Quality

RankingCompany - AName-Location

Y or N 1

Sourcing Consensus Documentation

Company B Name-Location

Y or N 2

Complete this section in similar manner as above




03 consensus_proforma_sample.xlsQuality, sheet 2 Tab 3 Updated: 10/29/01

The recommended supplier is identified in BOLD type

I. Life Cycle Costs and General Information

Exchange Rate Data PF4 Program Number (Provided by Program Finance - Obtain from Purchasing Program Mgt) ________# of parts Annual Freight Ford Owned Total LifetimeQuoted Overall Currency Exchange Rate Cost Cost Tooling Annual Cost

Value (USD) Denomination (per PF4 above) per unit Cost Cost inc productivity

$0.0000 $0.0000$0.0000 $0.0000$0.0000 $0.0000$0.0000 $0.0000

Productivity Annual Tooling Lead Time Historical, current and/or future

Supplier Turnover Production Prototype year year yearthis Distance to Ford Plant FSS Tool Time Tool Time Objective = Objective = Objective =

Commodity 1 2 n (Y or N) (weeks) (weeks) _______ _______ _______

If there is any portion of the quoted piece price, from the recommended supplier, that involves amortization, please describe and advise recovery process.

a. Net Present Value AnalysisNPV Analysis will allow for an analysis of the projected cash flows for the life cycle of the commodity/program to the present.

Year Year Year Year Year Year1 2 3 4 5 6

Program Volume >>

Supplier NPV of (commodity name)

Unit PricePre Launch Ford Owned

Tooling

$0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00$0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00$0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00$0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00

Average $0.00 #DIV/0! #DIV/0! $0.00 $0.00 $0.00 $0.00 $0.00 $0.00II. Final Offer Summary Cost of Capital

SupplierManufacturing

Location

Minority Supplier

(Yes or No)Material or Tier

2 Part (1)Material or Tier 2

Part (2)Material or Tier

2 Part (3)Material or Tier

2 Part (4)Material or Tier 2

Part (5)

* In the event that a detailed cost estimate exists,the buyer may wish to reflect how the various

SupplierOther Direct

LaborAssembly

LaborMfg

Overhead ScrapTotal Mfg

Costsquotes relate to the estimate.

Supplier Packaging SG&A Profit E D & T Total PriceProduction

Tooling

Does the recommended supplier agree to participate in the Warranty Reduction Program (yes or no)?

Sourcing Consensus DocumentationCommercial Assessment of Supplier Final Offers

Materials Costs *

General Information

Supplier Quoted Piece Price

Life Cycle Costs

General Overhead

Labor & Manufacturing Overhead

Manufacturing Costs

Manufacturing Costs

03 consensus_proforma_sample.xls, Commercial, Sheet 1 Tab 4Created: 02/11/02Updated: 04/03/02

II. Final Offer Summary (continued)

a. Explanation of Cost Variances and Negotiation Opportunities Negotiation Approach Opportunity

b. Target Agreement Roadmap Opportunities

c. Target Achievement Summary

d. Current Status (per ave. vehicle) Program Cost Opt. Supplier Projected Net B/(W)Target Estimate Status C/R Status Target

VariableInvestment

e. Quotation Exceptions Including exceptions to the Commercial Principles

Sourcing Consensus DocumentationCommercial Assessment of Supplier Final Offers (continued)

03 consensus_proforma_sample.xls, Commercial, Sheet 2 Tab 4Created: 02/11/02Updated: 03/04/02

A pro forma technical evaluation does notexist, however, examples are available fromrecently completed competitive quotations.These are, however, usually embedded in anoverall team "scorecard".

Sourcing Consensus DocumentationTechnical Assessment

03 consensus_proforma_sample.xlsTechnical Tab 5


Procedure No. PP – 2.1 Sourcing

Global Purchasing Procedure (Formerly Procedures 2.1.1, 2.1.2, 2.1.4, 2.1.11, 2.2, 2.2.1, 2.4.2, 2.5)

Issue Number: 20 Effective Date: December 2004 Return to Procedures TOC 1. PURPOSE

Quality & customer satisfaction are the driving forces in all sourcing actions. This procedure defines the process for source/supplier selection to fulfill a customers' requirement for specified products and/or services.

2. ACTIVITIES AFFECTED Global Purchasing, STA, North America & Europe

3. FORMS USED

3.1 Forms referenced in the procedure are available through the Purchasing Forms Index NOTE: Refer to Section 9 of this procedure for record retention periods

4. REFERENCES

4.1 Global Sourcing Process 4.2 Global Sourcing Stakeholders Meeting - GSSM 4.3 Competitive Quotation Guide 4.4 Tool to Obtain Accurate Volume Information 4.5 Global Prototype Purchasing User Guide 4.6 Prototype Multipliers 4.7 Global Purchasing Roles & Responsibilities 4.8 STA Sourcing Roles and Responsibilities 4.9 STA Work Instruction PSW-0005 - Sourcing for Quality Roles & Responsibilities

(Pre-Source & Competitive Quote) 4.10 eESWP (electronic Early Sourcing Work Plan) 4.11 STA Q1 procedure PSP-010 4.12 Raw Materials Commodities Management Policy RELATED PROCEDURES & WORK INSTRUCTIONS 4.13 Procedure 1.1 Commodity Sourcing Strategy Development 4.14 Procedure 1.3 FM&SP Q1 Process 4.15 Procedure 1.3.1 Sourcing to a Non-Q1 Facility (FM&SP) 4.16 Procedure 2.1.3 Resourcing 4.17 Procedure 2.1.5 Sourcing to a Non-Q1 Facility (Production) 4.18 Procedure 2.1.12 Sourcing Council 4.19 Procedure 2.3 Procurement of Ford-Owned Tooling 4.20 Procedure 2.4 Purchase Orders/Approval of Purchase Agreements 4.21 Procedure 2.4.5 Currency Denomination Requirements/Management 4.22 Work Instruction 2.1A - Sourcing to Competitors (Formerly Procedure 2.1.6) 4.23 Work Instruction 2.1B - Transfer Price 4.24 Work Instruction 2.1RM - Raw Materials Unique Sourcing & Purchase Order

Placement Routines 4.25 Directed Sourcing Guideline (Production Only) 4.26 Procedure 4.4 – Systems Supporting Procurement 4.27 Work Instruction 2.1S-OX – Sarbanes Oxley Review: Purchasing Compliance

Global Purchasing Procedure Page 1 of 11 Printed copies are uncontrolled

http://www.purchasing.ford.com/prch_prod_proc_man/html/pppmcont.html

http://www.purchasing.ford.com/prch_prod_proc_man/html/formsindex.html

http://www.purchasing.ford.com/prch_FPDS/sp/index.html

http://www.purchasing.ford.com/prch_FPDS/sp/globalsourcing.html

http://www.purchasing.ford.com/prch_FPDS/sp/competition.html

http://www.purchasing.ford.com/prch_prod_proc_man/html/pppmtool.html

http://wwwdev.purchasing.ford.com/prch_pg_guide

http://www.purchasing.ford.com/prch_prod_qual_man/html/pqmappxa.html

http://www.purchasing.ford.com/prch_sta_man/html/newrr.htm

http://www.edrwas.ford.com/launchomatic/launch/viewFile.jsp?chronicleId=09000c518034a2dc&docbase=edrdoc1&contentType=pdf


http://www.purchasing.ford.com/prch_eswp/index.html?

http://www.edrwas.ford.com/launchomatic/launch/view.jsp?chronicleId=09000c51801304d7&docbase=edrdoc1

http://www.purchasing.ford.com/prch_prod_proc_man/doc/commmgtpolicy.doc

http://www.purchasing.ford.com/prch_prod_proc_man/doc/pppm11.pdf






http://www.purchasing.ford.com/prch_prod_proc_man/html/pppm23.html



http://www.purchasing.ford.com/prch_prod_proc_man/doc/pppm21ains.pdf

http://www.purchasing.ford.com/prch_prod_proc_man/doc/pppm21bins.pdf

http://www.purchasing.ford.com/prch_prod_proc_man/doc/pppm21rmins.pdf

http://www.purchasing.ford.com/prch_prod_proc_man/doc/pppm21rmins.pdf

http://www.purchasing.ford.com/prch_handbk/DirectedSourcing/DirectedSourcingGuide.pdf


http://www.purchasing.ford.com/prch_prod_proc_man/doc/pppm21soxins.pdf



Issue Number: 20 Effective Date: December 2004 5. DEFINITIONS

5.1 Sourcing: Process by which a supplier is selected to provide a specified part, product and/or service and appropriate management approval is obtained.

5.2 Pre-Source: Formerly known as early sourcing. Refers to single sourcing (vs. competitive bidding) for supplier selection in the FPDS process

5.3 Single-Sourcing: Process by which purchasing does not conduct a competitive bid and has pre-selected a supplier to quote a project/program. A single source supplier should be listed in the commodity strategy (Production).

5.4 Commodity Strategy: Document detailing the approved supplier list and overall strategy direction for a particular commodity

5.5 Recap: Document which contains the complete details of a particular sourcing decision, e.g., supplier names, quoted pricing, sourcing and pricing rationale, etc.

5.6 On-Line Quote (OLQ): Tool used to aid the buyer in conducting a competitive request for quote. OLQ facilitates the receipt of supplier pricing via a web based software application. It also provides feedback to suppliers on their competitive position during the RFQ event and allows them to resubmit lower quotations, if desired.

5.7 CAS: Centrally Administered System, e.g., Purchasing systems such as WIPS, CPARS, eVEREST, etc.

5.8 Directed Sourcing: Ford directing a Tier 1 supplier to use a specific Tier 2 component supplier (for further information see the Directed Sourcing Guideline).

5.9 Selective Rebid: Re-issuing the same RFQ to a subset of suppliers that were originally involved on the initial request for quotation. Purchasing Manager (LL6+) approval is required in writing prior to sending the rebid to the targeted supplier(s).

5.10 Lead Buyer: FM&SP buyer responsible for updating and managing a particular commodity strategy.

5.11 Support Buyer: FM&SP buyer who does not have final responsibility for updating and maintaining a commodity strategy but may conduct transactions within that commodity.

5.12 STA: Supplier Technical Assistance

6. EXCLUSIONS 6.1 FM&SP authority is redelegated, as indicated in FM66-10-11.

7. PROCEDURE

7.1 Buyer receives a sourcing request. A sourcing request may include the following: Purchase Notification (PN), Advanced Purchase Notification (APN), Purchasing

Information Request (PIR) Authority to Proceed (ATP), generated by a WERS notice Sourcing Required Notification (SRN) Build to print/specification request Requisition Early sourcing request (e.g., via the eESWP system) Similar document from an interfacing activity

7.2 Refer to Procedure 2.1.3 for the process of resourcing an existing supplier. Global Purchasing Procedure Page 2 of 11 Printed copies are uncontrolled

http://www.dearborn.ford.com/fm/accntng/acpay66/apyprc66/6610/661011.html




Issue Number: 20 Effective Date: December 2004 7.3 Buyer ensures description/specification adequately describes the requested

product/component or service. 7.4 The sourcing process involves the following key steps:

Supplier Identification (Section 7.5 - 7.7) Supplier Selection/Quoting (General Overall Process) (Section 7.8 - 7.11) Competitive Bid/Market Test/Design Competition (Section 7.12 - 7.19)

Supplier Sourcing/Approval (Section 7.20 - 7.23) Prototype Sourcing (Section 7.26 - 7.28)

Supplier Identification

7.5 Buyer identifies potential supplier(s) to fulfill the sourcing request, preferably in line with the approved commodity strategy. The goal is to select the best available supplier(s) based on quality considerations, commercial judgment, program objectives and/or interfacing activity recommendation.

7.6 Logistics costs, including freight, obsolescence, duty, tax implications and logistics provider costs, should also be considered in all sourcing decisions. 7.6.1 When appropriate, freight studies are conducted within Production Purchasing,

usually under the following scenarios: • Parts being sourced are shipped long distances • Parts are large or bulky • Potential supplier is significantly closer to the targeted Ford assembly

plant than another potential source • Significant changes in distance for resourcing actions

7.7 Potential supplier(s) must meet the following requirements:

Commodity Strategy 7.7.1 Potential suppliers do not have to be listed on the commodity strategy, but must

be added to the strategy if a sourcing decision is made. Please review Procedure 1.1 for complete details.

7.7.2 Special approvals are required to source a supplier not listed on an approved commodity strategy. Refer to Purchasing Authorities Manual, Attachment #1, Note #13. Rationale for using a non-approved supplier shall be documented in the file.

Q1 Status

7.7.3 Suppliers must be assigned the Q1 status code "Y" to be eligible for sourcing. If the supplier is not Q1, refer to the non-Q1 sourcing process outlined in Procedure 2.1.5 (for Production) or Procedure 1.3.1 (for FM&SP).

7.7.4 Production Purchasing requirements state the sourcing of new business to non-Q1 facilities is limited to supplier manufacturing sites that are Production STA active (i.e., w/ an assigned STA site engineer).

7.7.5 FM&SP Q1 process is explained in detail in Procedure 1.3.

Sourcing Council



http://www.purchasing.ford.com/prch_prod_proc_man/html/ppauth1.html







Issue Number: 20 Effective Date: December 2004 7.7.6 Sourcing Council review is required if a change in the Ford or Visteon

make/buy (in-house/outside) pattern would result in: 7.7.6.1 North America: Moving the equivalent of one (1) Ford/Visteon

hourly employee per shift per plant into or out of a Ford or Visteon location. This also applies to all Ford facilities located in Mexico.

7.7.6.2 Visteon facilities in Mexico are excluded from the Sourcing Council process. However, buyers should review the Visteon Right of Last Refusal requirements for those components produced in Mexico for use in the United States.

7.7.6.3 Europe: Moving the equivalent of thirty (30) total Ford/Visteon hourly employees into or out of a Ford or Visteon location.

7.7.7 Sourcing Council pre-approval is required for market tests of any Visteon components (Tier I, Tier II or lower tier).

7.7.8 Sourcing Council policies must be followed when initiating sourcing actions that impact any Visteon components (Tier I, Tier II, or lower tier). One key item is Visteon's Right of Last Refusal (ROLR), which must be offered before proceeding with a resourcing request to the Sourcing Council. The ROLR process is scheduled to expire in June, 2003. Refer to Procedure 2.1.12 for complete details.

Supplier Selection/Quoting – General Overall Process 7.8 Buyer determines the appropriate supplier selection process. Supplier selection process

options include: • Single source (single source rationale must be documented in the file) • Pre-source (single source rationale must be documented in the file) • Competitive bid (via market test, design competition or OLQ) 7.8.1 The Global Sourcing Stakeholders Meeting (GSSM) is a Production Purchasing

tool to drive consensus and consistency in the sourcing process. 7.8.2 The potential supplier(s) and the sourcing approach (pre-source / competitive

bid) are reviewed for approval in Step 1 of the GSSM process (linked above), prior to action by the buyer. The sequence of steps is shown in the Sourcing for Quality Process Tool and Linkage diagram reference in 4.9 above. 7.8.2.1 The Buyer shall obtain STA input to the Pre-Source or Competitive

Quote Sourcing Process, per the Pre-Source and Competitive Quote processes and responsibilities. The STA input to these sourcing Processes is a completed SSQE. Further details on the Sourcing for Quality process are available through the STA Work Instruction PSW-005.

7.8.3 The attached document details the commodities targeted for GSSM review. 7.9 After choosing the appropriate selection process, the Buyer issues a request for quote

(RFQ) in the appropriate system. 7.9.1 Follow the appropriate systems guide to issue an electronic RFQ. 7.9.2 If issuing a manual RFQ, e.g. via e-mail or post-mail, the Supplier Quotation

form must be used (NA Only).



http://www.purchasing.ford.com/prch_FPDS/sp/globalsourcing.html

http://www.edrwas.ford.com/launchomatic/download?objectId=09000c518034a60e&session=false

http://www.edrwas.ford.com/launchomatic/download?objectId=09000c518034b2f7&session=false

http://www.edrwas.ford.com/launchomatic/download?objectId=09000c518034b2f7&session=false



http://www.purchasing.ford.com/prch_FPDS/sp/GSSM _files/GSSM Commodities_web_020304.doc


http://www.purchasing.ford.com/prch_prod_proc_man/html/pppf050.html



Issue Number: 20 Effective Date: December 2004 7.9.2.1 Manual RFQs are still acceptable within Ford of Europe Purchasing. 7.9.2.2 Quote One Pagers for design changes only are available through the

Purchasing Forms Index. 7.9.3 All RFQs shall reference Ford's Global Terms & Conditions. 7.9.4 Production Purchasing: Quotation not required at the time of sourcing when

the supplier is early sourced, or "pre-sourced." (Refer to Sec. 7.22) 7.9.5 FM&S Purchasing: Quotation required for all transactions, except as noted in

section 7.22.3. 7.9.6 Formal quotations must be obtained before the initial purchase order is issued.

7.10 Supplier responses may be received via post-mail, e-mail, fax, or electronically. 7.10.1 All supplier quotations must be signed (electronic signatures for e-mail &

electronic submissions are acceptable). 7.10.2 All supplier quotations, except for electronic responses, must be accompanied

by a signed Ford RFQ form. 7.10.3 FM&SP may accept quotations on supplier letterhead, provided the appropriate

electronic clause, referencing Ford global terms and conditions, is included on the order.

7.11 Buyer should ensure the suppliers' quotations are consistent with the approved funding for the order.

Competitive Bid / Market Test / Design Competition

7.12 Buyer may initiate a market test/design competition to determine which supplier best meets the program/requisitioner requirements or to identify potential suppliers. 7.12.1 Buyer will identify potential market test/design competition candidates, based

on the requirements in section 7.7. 7.12.1. 1 The buyer obtains from STA the Supplier Sourcing Quality Evaluation

(SSQE) per the Sourcing for Quality (SfQ) process (contained within the Competitive Quotation Guide)

7.12.2 Requests for quotation must only be sent to suppliers that will be given consideration as a potential source and supplier pricing must not be disclosed to other suppliers.

7.12.3 Suppliers participating in a market test/design competition do not have to be listed on the commodity strategy, but must be added if a sourcing decision is made.

7.13 Commodity/Core or CBG/Operations or FM&SP Buyer may conduct the actual market test/design competition. Refer to the Competitive Quotation Guide for complete instructions (Production Purchasing Only).

7.14 The due date on the RFQ may be revised by the buyer, but all suppliers invited to quote must be appropriately informed. 7.14.1 Purchasing Manager approval is required to accept late bids, if only selected

suppliers from the original bid list are permitted to submit a late bid. 7.15 If a selective rebid is required, Purchasing Manager (LL6+) approval authority is

required in writing, prior to sending the rebid to the targeted supplier(s). Refer to Authorities Manual - Attachment #1, Note 3.


http://www.purchasing.ford.com/prch_misc_pubs/html/global_terms.html






Issue Number: 20 Effective Date: December 2004 7.16 After all suppliers invited to bid have responded to the RFQ and/or the RFQ due date

has expired, the buyer prepares a recap document to analyze the quotations. Recaps generally contain a summary of key bid information, e.g., individual supplier names, price, timing, and other information pertinent to making a sourcing decision. For GSSM commodities and others, as appropriate, the recap format to be used is the Sourcing Consensus Pro forma, PP-P-F086. 7.16.1 Recap must be stated in equivalent currencies for comparison purposes and

business must be placed in the currency of the country of manufacture or where the majority of costs are actually incurred or the currency determined by the requisitioner's Controller's Office. Use the latest exchange rates determined by the Treasurer's Office.

7.16.2 Refer to Procedure 2.4.5 for deviation process. 7.17 Buyer clarifies, as necessary, the price, terms and conditions, timing, etc., with the

supplier. Any issues should be reviewed with the buyer's management, Program Management Team and/or requisitioner, as appropriate.

7.18 Buyer may have the recap reviewed by the interfacing activity to ensure all quotations are consistent with the specification.

7.19 Europe Only: Sourcing of production steel requirements, prices and terms & conditions are agreed by the Purchasing Manager and the supplier on an annual basis.

Supplier Sourcing/Approval

Regardless of selection method, the following sourcing requirements must be met: 7.20 Supplier selection must be completed via one of the following:

• Competitive quotation, with analysis of results by Engineering/Requisitioner and/or Purchasing

• Single source/pre-source recommendation from Engineering/Requisitioner and/or Purchasing

• Selection of the best available supplier based on quality considerations and commercial judgment

7.21 Sourcing must be approved and documented consistent with Authorities Manual #1. Sourcing approval must be obtained before order placement or formal communication of awarded business is sent to the supplier. 7.21.1 Sourcing approval can be documented via the following:

• Early Sourcing Approval Request • eESWP Sourcing Matrix

NOTE: All new product programs are required to use this system to document sourcing actions. However, the manual sourcing matrix is an acceptable form of sourcing approval for product program sourcing actions conducted prior to the eESWP system launch in 2000.

• Recap (e.g. electronically documented and recorded within the purchase order file or manual pro-forma document)

• GSSM meeting minutes • Sourcing Consensus Pro-Forma - Form #PP-P-F086 (an Excel based recap

which includes the SSQE).




http://www.purchasing.ford.com/prch_prod_proc_man/html/pcpf054.html

http://www.purchasing.ford.com/prch_eswp/index.html

http://www.purchasing.ford.com/prch_prod_proc_man/html/pppf086.html



Issue Number: 20 Effective Date: December 2004 • "White paper" – (free-form request for sourcing approval which contains

all essential elements to make a sourcing decision) 7.21.2 Sourcing approval and rationale shall be maintained in the buyer file.

Additional rationale must be included when sourcing to other than the low bidder.

7.21.3 Sourcing rationale must be stated in equivalent currencies for comparison purposes (usually US dollars) and business must be placed in the currency of the country of manufacture. Refer to Procedure 2.4.5 for deviation process. Use the latest exchange rates determined by the Treasurer's office.

Production Purchasing

7.21.4 Documentation of sourcing approval shall be retained by the Commodity/Core/Central Buyer. 7.21.4.1 However, the documentation is a quality record and must be

maintained, as required, and also be accessible to and produced by both the Commodity/Core/Central Buyer and CBG/Operations/Program Buyer during an internal audit.

7.21.5 CBG/Operations/Program Buyer may use the communication of sourcing approval (via e-mail or letter) by the Commodity/Core/Central Buyer as sourcing documentation. Evidence of such communication must be retained.

7.21.6 After securing management approval, the Buyer communicates source selection to the vehicle program or requisitioner. 7.21.6.1 For a new supplier site, the buyer establishes a GSDB code for the

site per GSDB Request Form (PC-P-F044) within 30 days of sourcing approval. This supports STA use of the new site Sourcing for Quality Manufacturing Site Assessment for the Q1 process (STA Procedure PSP-010).

7.21.6.2 Communication of sourcing selection to the supplier during the pre-sourcing process must be documented via a Sourcing Agreement, which may include a Price Agreement and may be followed by a Target Agreement.

7.21.6.3 After the program has passed the Program Approval milestone, a confirming purchase order will be issued to the supplier.

7.21.7 eVEREST has 2 types of purchase orders: 7.21.7.1 Standard Purchase Order (one- time type of buy with defined quantity,

such as lump sum or tool order) 7.21.7.2 Blanket Purchase Agreement (purchase order used where the only

quantity available is a percentage of business) 7.21.7.3 For legal purposes, all Production Purchasing orders are referred to

as purchase orders. FM&S Purchasing

7.21.8 Evidence of sourcing approval must be retained by the appropriate FM&SP Buyer in the purchase order file.



http://www.purchasing.ford.com/prch_prod_proc_man/doc/pcpf044.doc





Issue Number: 20 Effective Date: December 2004 7.21.9 Buyer-led market test/competitive bid may be conducted as part of normal

review program or if a concern arises over a supplier's performance. 7.21.10 If RFQ is initiated by PIR/APN, the buyer sends the requisitioner a copy of

supplier quotations, which may be accompanied by a recap. 7.22 Prior to issuing a purchase order (refer to Procedure 2.4), a Ford generated quotation,

either manual or electronic, documenting supplier pricing is required. Additional supporting documentation from the supplier may be attached. 7.22.1 This element applies to both Production Purchasing and FM&SP. 7.22.2 Evidence of supplier quotations and/or market test/design competition results

shall be retained by the responsible buyer. 7.22.3 FM&S Purchasing: Competitive or written bid is not mandatory if the value of

commitment is less than $10,000. See Authorities Manual - Attachment #1, Note 15 for complete details.

7.23 In those situations where a supplier's proposal is referenced on the purchase order or is the basis of sourcing, Purchasing must review the supplier's proposal to identify any terms & conditions that conflict with Ford's Global Terms & Conditions. (Note: Deviations to Ford Global Terms and Conditions are strongly discouraged and require approval from the Vice President, Global Purchasing. Refer to procedure 2.4.1 – Global Terms and Conditions). If any such conflicting terms are found, the buyer shall determine whether Ford and the Supplier have previously agreed to a set of exceptions to Ford's standard terms which were intended to govern future Purchase Orders. If such an agreement exists, the Purchase order shall be modified to include an appropriate reference to the agreed Ford / Supplier agreement. Such as (CPARS Clause 4-22 or eVEREST equivalent);

"This purchase order is issued based on the pricing and technical specifications of your proposal dated xx/yy/zz. All other terms & conditions of this order are based on the Ford / Supplier agreement dated aa/bb/cc. Any other exceptions to these terms must be approved in writing by the Ford buyer."

7.24 If the proposal is NOT based on any prior Ford / Supplier agreement, the Purchase order must be modified to include an appropriate reference to Ford's Global Terms & Conditions, such as (CPARS Clause 4-21 or eVEREST equivalent);

"This purchased order is issued based only on the pricing and technical specifications of your proposal dated xx/yy/zz. All other terms & conditions of this order are based on Ford's Global Terms & Conditions as referenced on this purchase order. Any exceptions to Ford's Global Terms and Conditions must be approved in writing by the Ford buyer."

7.25 Cost rationale shall be documented and may include, but is not limited to: • Competitive bid data • Benchmarking information • Historical price data • Team Value Management (TVM) tools • Formal Cost Optimization analysis • Quick Web Estimating Software Tool (QWEST) data






http://www.qwest.ford.com/qwest/default.asp



Issue Number: 20 Effective Date: December 2004 • Cost tables (if applicable). • Other methodology may be used to determine the price justification as long as it is

documented and such information is retained as part of the purchase order file 7.25.1 All FM&SP purchase order files over $500,000 must include documentation

outlining the price justification for order placement. Refer to Authorities Manual - Attachment #1, Note 7 for complete details.

Prototype Sourcing

7.26 Wherever possible, prototype parts should be sourced to the selected supplier of the future production requirements and manufactured using the production or a production representative procedure.

7.27 The buyer should use the prototype ordering system supported by the local systems group. The prototype process is defined in the necessary system users guide.

7.28 Once the prototype build has been established, the prototype order is established in GPIRS. The GPIRS system feeds WIPS (for both purchase orders and tool orders). Upon prototype request in WIPS, prototype orders (including tool orders) are issued to the supplier.

7.28.1 If prototype pricing is obtained via an RFQ process, follow the same basic steps as outlined in this procedure. Prototype sourcing must meet the requirements outlined in section 7.20 - 7.23.

7.28.2 The buyer may use agreed prototype multipliers, agreed target costs or historical cost to document prototype pricing, in lieu of a supplier quotation.

7.28.3 Sourcing and pricing rationale shall be documented in the prototype purchase order file.

8. GENERAL RULES

8.1 The purchase order normally serves as the document, which commits Ford to the purchase of materials/services produced by a supplier. In cases where sourcing commitment is required in advance of the purchase order, and the existing early sourcing documents are not appropriate, the Buyer may issue the Supplier Involvement Request (SIR) (Production Purchasing Only).

8.2 The Supplier Involvement Request should be used on a selective/exception basis only and obtaining agreement from the Program Team and Global Council must precede notification to the supplier.

8.3 Usage of the SIR falls within 2 categories: 8.3.1 No Intent to Commit Production Business 8.3.2 Intent to Commit Production Business

8.4 The "No Intent to Commit Production Business" document should be used when the team is not ready to select a supplier, but needs input on a new technology or vehicle packaging/feasibility study support. 8.4.1 If teams wish to pursue the option of paying for supplier services, approval

must be received from PD Finance and the Purchasing Controller's Office, prior to any notification to the supplier.








Issue Number: 20 Effective Date: December 2004 8.5 The "Intent to Commit Production Business" (Suppliers Business to Lose) document is

used in isolated pre-sourcing situations, typically in the pre <SI> timeframe, when a cross-functional team has demonstrated the business need for this early action, even though the program targets are still being defined. 8.5.1 GSSM approval is required prior to sending the letter to the supplier.

8.6 Please refer to the instructions attached to the appropriate forms for complete details and possible examples.

8.7 Any changes to the SIR form should be reviewed by the Office of General Counsel to ensure Ford's legal commitment is clear and to advise Purchasing if the letter constitutes a contingent or other undesired liability.

8.8 Volume information provided in CAS comes from Pre-Production systems and should be considered the master. In the event the Buyer or Supplier believes that volume information in CAS is inappropriate, the following resources are available for volume verification - Tools to Obtain Accurate Volume Information - Attachment A.

8.9 Sarbanes Oxley Compliance: Adherence to Sarbanes Oxley standards, require the establishment of effective controls. Areas of this procedure (highlighted below) fall within the scope of Sarbanes Oxley. (Refer to the Sarbanes-Oxley Review Module and Work Instruction 2.1S-OX for all procedures that address Sarbanes Oxley requirements) 8.9.1 (Note: S-OX Quest. 713: Are Prototype Tool Orders issued when prototype builds are required?)

• How is control performed: Selection is conducted upon receipt of sourcing request.

• Who performs control: Buyer performs control through source selection How often is control performed: As required (upon sourcing need) • How is control Monitored/Reviewed: Monitored/reviewed through system generated ATPs filtered to Manager/Supervisor

•

9. RECORDS

Global Purchasing denotes specific forms and documents prepared during the normal course of Purchasing activity as Official Records. Official Purchasing Records referenced in this procedure are identified in the Purchasing Quality Records Matrix (PQRM). The PQRM includes retention periods and is administered in accordance with the Corporate Global Information Standards (GIS). Additional information regarding other forms, documents and Corporate record management practices can be found at the GIS site.

10. RECORD OF REVISIONS

Date Approved by Description May 2003 D. J. Halliday Align w/ corporate format & FAPs 03-002, 03-003 (Formerly Procedures 2.1.1, 2.1.4, 2.1.11, 2.2, 2.2.1, 2.4, 2.5) October 2003 D. J. Halliday Incorporation of Procedure 2.1.2 (FM&S PO clauses) January 2004 D. J. Halliday Sarbanes-Oxley inclusion June 2004 D. J. Halliday Alignment of Purchasing Sourcing Process w/STA Sourcing for Quality Process Dec 2004 D. J. Halliday Selective Rebid Policy Change – (MCRP)


http://www.purchasing.ford.com/prch_prod_proc_man/html/pppmtool.html

http://www.purchasing.ford.com/prch_prod_proc_man/doc/soxrevmod.doc

http://www.purchasing.ford.com/prch_prod_proc_man/doc/pppm21soxins.pdf

http://www.purchasing.ford.com/prch_prod_proc_man/doc/pppm43d.pdf

http://www.dearborn4.ford.com/gim/gis/gisoverview.htm





Issue Number: 20 Effective Date: December 2004 NOTE: Indicates area of change from the previous issue


Sourcing for QualityData Entry Sheet

12345 Supplier Delivery Site List

1

2

3

4

5

Materials/Data to have available while completing this Process:

Supplier Sourcing Quality Evaluation (SSQE) form - completed by each supplierSite Assessment for each Supplier (EKB address??)

Add Website Address for Guidelines (add Hyperlink)

Instructions:

Supplier Improvement Metrics (SIM) - SummaryParent SIM Report Card

Under the Data Entry column of Section I, II and III below, enter the data specific to this evaluation. Thisinformation will automatically feed into the required fields in both the Quality Data Summary Matrix (tab 2)and the Sourcing for Quality Executive Summary (tab 4). (Note: A maximum of 6 suppliers is allowed)

Complete the Quality Data Summary Matrix (tab 2) by providing a Score for each element for each supplier(See Quality Data Summary Guidelines for STA Site Engineers for information on how to score eachelement - website address is provided below). The worksheet will automatically sum the Totals whererequired and enter these Totals in the appropriate places on the Sourcing for Quality Executive Summary(tab 4).

Helpful Hint: To get a definition of the element while filling out the form place the cursor on the cell with the element Name (example: 1.1 Quality Segmentation). A comment box showing the element definition will appear as long as your curser is on this cell. To make the comment stay shown while working on the document, select the cell with the right mouse button, then select "Show Comment". When you are complete, again select the cell with the right mouse button, then select "Hide Comment". The same can be done to show how to score each element if you look at the comment box that is associated with the "Max Score" for that particular element.

When complete with the Quality Data Summary Matrix , go to the Ranking Macro worksheet (tab 3) and leftclick the cursor on the Automatic Supplier Ranking Macro button. This will run a macro that automaticallytakes the information entered into the Quality Data Summary Matrix (tab 2) and ranks the suppliers fromhighest to lowest COMBINED SCORE % points. The ranked supplier information is automatically enteredinto the Sourcing for Quality Executive Summary (tab 4).

Under the Data Entry column of Section IV below, enter the name of the CONSENSED Supplier, theCONSENSED Supplier Site, the rationale for selecting this Supplier, the Key Supplier Challenges and theWorkplan to Overcome the Challenges. This information will automatically feed into the appropriate field onthe Sourcing for Quality Executive Report (tab 4).

The Sourcing for Quality Executive Summary should now be complete, with all required data automaticallyfeeding from this Data Entry Sheet, the Quality Data Summary Matrix (tab 2) and the Ranking Macroworksheet (tab 3). Select the Auto Generated Exec Report tab (tab 4) and print the report.

Content Contact: C. Green (CGREEN)Format Contact: B. Fagerson (BFAGERSO)/L. Blair-Johnson (LBLAIR)05 ssqe-exec_summary_sample.xls 1. Data Entry Sheet

Page 1 of 17Date Issued: 16-May-2002

Date Revised: 16-May-2002Revision: 11


Section: Element Data Entry

I Vehicle Program / Model Year: XXX / 2005

Commodity: Door Trim Panels

Design Responsibility (Ford or Supplier):

Supplier

Benchmark Vehicles BMW

Benchmark Component Supplier: Supplier YYY supplies BMW X5, Z3

II Total Number of Suppliers: 6

Note: Proceed Supplier Name with (*) if surrogate data is used

Example: * Visteon

Supplier Name: Supplier #1

Site Code: (if new supplier with no site code, enter NA)

Site Code #1

SiteLocation (City, State, Country): Site Location #1

If Surrogate Data is being used, list location where data is from (City, State, Country):

Supplier Name: * Supplier #2

Site Code: (if new supplier with no site code, enter "Not Available)

Not Available


If Surrogate Data is being used, list location where data is from (City, State, Country): Surrogate Site Location #2

Supplier Name: *Supplier #3


Not Available

SiteLocation (City, State, Country): TBD








Site Code #4



Supplier Name: * Supplier #5


Not Available

SiteLocation (City, State, Country): TBD




Site Code #6



Section Element Data Entry

III Commodity Specific Info.

6 month Commodity Average PPM 60





Section Element Data Entry

IV Note: Proceed Supplier Name with (*) if surrogate data is used

Example: * Visteon

* Supplier #2

Site Location #2

Commodity design experience exceeds 19 years. Supplier of XXX to the BMW BIC competitive vehicles, other OEM customers include VW, Mercedes, Peugote, DCX and Saturn. Suplier #2's current XXX CPU warranty and R/1000 metrics are excellent. Reliability experts are trained and implementing robustness and reliability techniques thru the production process. PPM/Delivery metrics are BIC. Strong QOS (BMW, Saturn, DCX) in place, including BIC FMEA's, control plans, APQP. Processes are capable. CPk levels for Saturn XXX's range from 1.63 CPk to 5.78 CPk. Outstanding Lean implementation. Scrap/Rework improved by 20% and efficiency by 10% from 2000 to 2001. Evidence shows Supplier #2 has a Skills Assessment Training Plan that is standard in their APQP checklist. Existing processes to be used for manufacturing limiting new technology risk. Strong desire to bring supplier into Ford supply base.

* Note : The rationale description above must be brief and contained only in the size box above. Be sure to check that no wording has been cut off in the Executive Summary.

Consensed Supplier:

Consensed Supplier Site:

Rationale for selecting Consensed Supplier

Be sure that information in all Sourcing for Quality documents are aligned and summarized in the rationale for selecting the Consensed Supplier.

Incorporate comments from Site Engineer based on validation of SFQ documents

Identify any strengths which support sourcing decision: - Experience with commodity - Ford supplier history - Site's market share - Customer list - Age of plant/equipment - Process flow

- BIC performance - Toyota supplier - QOS - Process improvement initatives





This supplier is new to the Ford NA supply base. The proposed site is a Greenfield Site in NA while both Engineering and Manufacturing Centers of Excellence are located in Europe.

* Note : The Key Supplier Challenges description above must be brief and contained only in the size box above. Be sure to check that no wording has been cut off in the Executive Summary.

The proposed new site will utilize experienced production personnel from an existing site. Supplier to establish an support staff in NA to provide engineering expertise to the proposed Greenfield Site. A detailed Design and Manufacturing work plan will be provided by <SC> and reviewed with Product Engineering, Purchasing and Manufacturing at all regular program meetings.

* Note : The Key Supplier Challenges description above must be brief and contained only in the size box above. Be sure to check that no wording has been cut off in the Executive Summary.

STA Engineer Name / Date Completed: First Last Name / 25-April-2002

Key Supplier Challenges:

Should include both Supplier Challenges and Ford Challenges.

Identify risks that were identified during the evaluation process with high level workplan/timing

- Engineering Resources - Quality Performance - Greenfield Site - Launch history to Ford - Quality basics (FMEA, Control Plans, etc.)

Workplan to Overcome Challenges:

Be sure to include Timing for each action and where each action will be officially documented and agreed with supplier

Example: Statement of Work, Sourcing Agreement, etc.




Supplier Sourcing Quality Evaluation (SSQE) - Quality Data Summary MatrixKEY: Higher Score is Better

Design Responsibility: SupplierBenchmark Vehicles: BMW


* Note: Surrogate data was used for this supplier in this evaluation

I. Company / Site

Surrgate Location: Surrgate Location: Surrgate Location: Surrgate Location: Surrgate Location: Surrgate Location:

Weight = 10%

<Help> 3 9 n/a 0 3 9 n/a 0 n/a 0 n/a 0

<Help> 423 out of 474 0 345 out of 474 0 274 out of 474 0 n/a 0 n/a 0 310 out of 474 0

<Help> 10 years 3 19 years 9 20 years 9 5 years 3 < 1 year 0 9 Years 3

<Help> Ford, GM, DCX, Toyota, Honda

9Ford (Europe), BMW, Mercedes, Peugeot,

DCX, VW9 Ford, GM, Mercedes,

Toyota, DCX9 BMW, Mercedes 3 GM 3 DCX, Toyota, GM 9

<Help> Yes 9 None 0 Yes 9 n/a 0 n/a 0 Yes 9

<Help>

Ford Q1; GM Supplier of the Yr. 94,97,98; Ford High Mileage Reliability Award

9

Q1 Preferred Quality Award (1998); Seat Belt Supplier Award (1989,

1990)

0

Ford Q1; JCI Quality Olympic Gold Award 2000; GM Multiple

Quality Awards

3 n/a 0 n/a 0Ford Q1; 1988, 1992 NUMMI Certicicate of

Achievement3

<Help> No 9 No 9 No 9 No 9 No 9 No 9

129 90 147 42 30 87

Bus Indicators Weighted % Pts.

8 % 6 % 9 % 3 % 2 % 5

Not Available Site Code #6

Data Score

Site Location #2 TBD

Data Score Data Score

Surrogate Site Location #3

Data Score

Aut

omat

ic

Cal

cula

tion

1.2 Business Unit/Parent Ranking

1.6 Automotive Quality Awards (3 years) (Q1 excluded ?)

Inpu

t Dat

a an

d S

core

for e

ach

Sup

plie

r

1.3 Site Experience with Commodity

Vehicle Program / MY: Commodity:

STA Engineer/Date Completed:

Site Location #4 TBD

* Supplier #5

Site Code #4

Supplier #6

Site Location #6

Supplier #4


IBusiness Indicators

1.5 6-Sigma or Other Tools Experience

1.1 Quality Segmentation

Data Score

Sco

ring

Cri

teri

a

1.7 Government Safety Organization Involvement (2 years)

XXX / 2005Door Trim PanelsFirst Last Name / 25-April-2002

* Supplier #2

Site Location #1

Supplier #1

Site Code #1 Not Available

*Supplier #3

Not Available


Data Score

162

10%

max possilbeTotal weighted points=(Each element is weighted independently)

1.4 Site OEM Customers (Site)

max possible % points =

Content Contact: C. Green (CGREEN)Format Contact: B. Fagerson (BFAGERSO) / L. Blair-Johnson (LBLAIR)05 ssqe-exec_summary_sample.xls 2. Quality Data Summary Matrix

Page 6 of 17Date Issued: 21-Mar-2002

Revision Date: 06-May-2002Revision: 10









Weight = 25%<Help> Acceptable 3 Excellent 9 Acceptable 3 Acceptable 3 n/a 0 Excellent 9

<Help> Acceptable 3 Acceptable 3 Excellent 9 Acceptable 3 n/a 0 Acceptable 3

<Help> Acceptable 3 Excellent 9 Excellent 9 Acceptable 3 n/a 0 Acceptable 3

<Help> Poor 0 Excellent 9 Acceptable 3 Acceptable 3 n/a 0 Acceptable 3

<Help> Poor 0 Excellent 9 Excellent 9 Acceptable 3 n/a 0 Acceptable 3

<Help> Poor 0 Excellent 9 Acceptable 3 Poor 0 n/a 0 Acceptable 3

<Help> Acceptable 3 Acceptable 3 Acceptable 3 Acceptable 3 Poor 0 Acceptable 3

48 204 156 72 0 108

Site Assess Weighted % Pts.

5 % 20 % 15 % 7 % 0 % 11

TBD Site Location #6Site Location #1 Site Location #2 TBD Site Location #4


*Supplier #3 * Supplier #5 Supplier #6* Supplier #2

Not Available

Supplier #4


Data Score Data Score Data Score Data Score

Aut

omat

ic

Cal

cula

tion


25%

Data Score

252

2.3 Sub-Supplier Quality Management

2.6 Lean Performance

Site Code #1

2.5 Problem Solving

Inpu

t Dat

a an

d S

core

for

each

Sup

plie

r

Sco

ring

Cri

teri

a

IISite Assessment

Highlights

Supplier #1

Data Score

Surrogate Site Location #2 Surrogate Site Location #3 Surrogate Site Location #5

2.1 FMEA/Control Plan

2.2 PPAP

2.4 PM/Housekeeping


2.7 Variability Reduction Demonstration












Weight = 15%<Help> Acceptable 3 Excellent 9 Poor 0 Poor 0 Poor 0 Poor 0

<Help> Acceptable 3 Acceptable 3 Acceptable 3 Acceptable 3 Acceptable 3 Acceptable 3

<Help> Acceptable 3 Poor 0 Poor 0 Poor 0 Acceptable 3 Poor 0

<Help> Acceptable 3 Acceptable 3 Poor 0 Poor 0 Poor 0 Poor 0

48 60 12 12 24 12

Mfg. Risk Weighted % Pts.

5 % 6 % 1 % 1 % 3 % 1

Not Available Site Code #6Not Available Site Code #4

* Supplier #5Supplier #1

Site Location #1

Site Code #1

3.3 Engineering / Corporate Resources

3.2 New Technology Experience


15%

3.4 Manufacturing Facility

Supplier #6*Supplier #3

Aut

omat

ic

Cal

cula

tion 144

Data Score

Site Location #4 Site Location #6



Supplier #4

TBD

3.1 Employee Readiness


Inpu

t Dat

a an

d S

core

for

each

S

uppl

ier

Sco

ring

Cri

teri

aSurrogate Site Location #2 Surrogate Site Location #3

Site Location #2

Not Available


* Supplier #2

Data Score

TBDIII

Manufacturing Risk to Program












Aut

omat

ic

Cal

cula

tion

18 % 32 % 25 % 11 % 5 % 17

Site Location #4

Surrogate Site Location #3Surrogate Site Location #2

Site Code #1 Not Available

Site Location #1 Site Location #2

Supplier #4*Supplier #3* Supplier #2Supplier #1

I. COMPANY / SITE

SUB-TOTAL WEIGHTED % POINTS


TBD

I. Business Indicators II. Site Assessment Highlights III. Mfg Risk to Program

50%



* Supplier #5 Supplier #6

TBD Site Location #6











II. PRODUCT


Weight = 20%

<Help> Yes / Yes 9 Yes (B-Car) 9 Yes 9 n/a 0 n/a 0 Yes 9

<Help> 3 9 3 0 0 3

<Help> Acceptable 3 Excellent 9 Acceptable 3 Poor 0 Poor 0 Acceptable 3

<Help> Acceptable 3 Excellent 9 Acceptable 3 Acceptable 3 Acceptable 3 Poor 0

48 108 45 12 12 36

Customer Sat Weighted % Pts.

9 % 20 % 8 % 2 % 2 % 7

Not Available Not Available

15%

* Supplier #2 *Supplier #3

Site Code #6

Data Score

Site Code #4

Supplier #4

Sco

ring

Cri

teri

a

Aut

omat

ic

Cal

cula

tion

4.3 Warranty Reduction Effectiveness


Supplier #1


Site Location #1

Site Code #1

Site Location #2

5%


0%

Site Location #4TBD Site Location #6

Not Available

* Supplier #5

TBD

Supplier #6

8%

Data Score Data Score Data Score

4.4 Reliability Demonstration

4.3a Memo: Rate of change year-over-year % improvement

4.1 Warranty Share

IVCustomer Satisfaction

4.2 Warranty Reduction

Inpu

t Dat

a an

d S

core

for

each

Sup

plie

r

-5%


Data Score

108

20%

Data Score

10%













Weight = 30%<Help> Q1 9 Q1 9 Q1 9 n/a 0 n/a 0 Pending Q1 3<Help> 800 3 1150 9 1050 3 n/a 0 n/a 0 n/a 0<Help> 0 9 0 9 0 9 0 9 0 9 0 9<Help> 3 0 0 9 0 9 0 9 0 9 0 9

<Help> 62 0 15 9 163 0 34 3 n/a 0 12 (GM) 9

<Help> 515 0 22 9 49 9 46 (BMW) 9 n/a 0 27 (GM) 9

<Help> 88 3 100 9 95 9 n/a 0 88 3 n/a 0

<Help> 99 9 87 3 99 9 n/a 0 n/a 0 99 9

<Help> 0 9 0 9 0 9 0 9 0 9 0 9

<Help> PLACE HOLDER PLACE HOLDER PLACE HOLDER PLACE HOLDER PLACE HOLDER PLACE HOLDER

<Help> 1 3 0 9 0 9 0 9 0 9 0 9<Help> PLACE HOLDER PLACE HOLDER PLACE HOLDER PLACE HOLDER PLACE HOLDER PLACE HOLDER

138 258 228 168 150 204

Quality Perf Weighted % Pts.

14 % 25 % 22 % 16 % 15 % 20


Data Score

Not Available Not Available Site Code #4

Data Score

TBD

Data Score

Site Code #1

VQuality Performance

5.8 Production Delivery (6 mo. weighted avg.)

5.7 PPM: 12 Month5.6 Memo: 6 mo. Commodity =

Inpu

t Dat

a an

d S

core

for

each

Sup

plie

rA

utom

atic

C

alcu

latio

n

5.11 PSW Slips with no Design Changes (24 mo.)5.12 Number of SRI'S (24 mo.)5.13 Post-Launch Scorecard

5.9 FCSD Delivery (6 mo. weighted avg.)5.10 PSW Slips (24 mo.)

5.4 No. Stop Ships (12 mo.)

5.5 PPM: 6 Month

5.2 Q1 Score (out of 1,000 pts)5.1 Quality Certification

60

Sco

ring

Cri

teri

a

* Supplier #2


Site Location #4Site Location #2

*Supplier #3


Supplier #4

TBD


30%

Site Location #6



Supplier #6* Supplier #5

306max possilbeTotal weighted points=

(Each element is weighted independently)

Site Location #1

Supplier #1

Production PPM:

Data Score

5.3 Field Actions (24 mo.)












Aut

omat

ic

Cal

cula

tion

23 % 45 % 30 % 18 % 17 % 27

Site Code #6

IV. Customer Satisfaction V. Quality Performance

Site Location #4Site Location #2 TBD

50%

Site Location #1 TBD Site Location #6

* Supplier #5

II. PRODUCT

SUB-TOTAL WEIGHTED % POINTS

Sco

ring

Cri

teri

a

Supplier #1

Site Code #1 Not Available Not Available Site Code #4 Not Available

Supplier #6


* Supplier #2 *Supplier #3 Supplier #4












18 % 32 % 25 % 11 % 5 % 17

23 % 45 % 30 % 18 % 17 % 27

COMBINED SCORE 41 % 77 % 55 % 29 % 22 % 44

Site Code #6Not Available Not AvailableNot Available Site Code #4

IV. Customer Satisfaction V. Quality Performance

Aut

omat

ic C

alcu

latio

n

I. Business Indicators II. Site Assessment Highlights III. Mfg Risk to Program

TBDSite Location #1

* Supplier #2 *Supplier #3Supplier #1 Supplier #4

Site Location #4TBDSite Location #2

Site Code #1

Site Location #6

* Supplier #5 Supplier #6

50%

50%

100%


SUMMARY




Supplier Site Code Site Location Surrogate Site Location

COMBINED SCORE

I.Business Indicators

II. Site

AssessmentHighlights

III.Mfg Risk to

Program

Sub-Total IV. Customer

Satisfaction

V.Quality

Performance

Sub-Total

Weight 100% 10% 25% 15% 50% 20% 30% 50%* Supplier #2 Not Available Site Location #2 Surrogate Site Location #2 77 6 20 6 32 20 25 45*Supplier #3 Not Available TBD Surrogate Site Location #3 55 9 15 1 25 8 22 30Supplier #6 Site Code #6 Site Location #6 44 5 11 1 17 7 20 27Supplier #1 Site Code #1 Site Location #1 41 8 5 5 18 9 14 23Supplier #4 Site Code #4 Site Location #4 29 3 7 1 11 2 16 18* Supplier #5 Not Available TBD Surrogate Site Location #5 22 2 0 3 5 2 15 17

Supplier Ranking - Automatic Calculation Macro

Originator: B. Fagerson (BFAGERSO)/L. Blair-Johnson (LBLAIR)05 ssqe-exec_summary_sample.xls 3. Ranking Macro

Page 14 of 17Date Issued: 16-Jan-2002 Date Revise 06-May-2002

Revision: 10

Sourcing for Quality - Executive Summary

Vehicle Program / Model Year: XXX / 2005Commodity: Door Trim Panels

Selection Scoring Summary

I.Business Indicators

II. Site

AssessmentHighlights

III.Mfg Risk

to Program

Sub-Total

IV. Customer

Satisfaction

V.Quality

Performance

Sub-Total

100% 10% 25% 15% 50% 20% 30% 50%

77 6 20 6 32 20 25 45

55 9 15 1 25 8 22 30

44 5 11 1 17 7 20 27

41 8 5 5 18 9 14 23

29 3 7 1 11 2 16 18

22 2 0 3 5 2 15 17

Note: Higher Score is Better

II. PRODUCT

Page 2f

Com

bine

d S

core

Supplier #4

I. COMPANY / SITE

Supplier

WEIGHT

* Supplier #2

*Supplier #3

Supplier #6

Supplier #1

Wei

ghte

d %

Poi

nts

* Supplier #5

0

10

20

30

40

50

0 10 20 30 40 50

* Supplier #2

*Supplier #3

Supplier #6

Supplier #1

Supplier #4

* Supplier #5

Pro

duct

Company / Site

High Capability - Source

Low Capability - Extraordinary Actions Required

Medium Capability - Source with plan

Content Contact: C. Green (CGREEN)Format Contact: B. Fagerson /L. Blair-Johnson 05 ssqe-exec_summary_sample.xls

Date Issued: 16-Jan-2002 Date Revised: 06-May-02

Revision: 10

Sourcing for Quality - Executive Summary

Vehicle Program / Model Year: XXX / 2005Commodity: Door Trim Panels

* Note: Surrogate Site information used in this evaluation

1

2

3

4

5

6

CONSENSED SUPPLIER / SITE:

Commodity design experience exceeds 19 years. Supplier of XXX to the BMW BIC competitive vehicles, other OEMcustomers include VW, Mercedes, Peugote, DCX and Saturn. Suplier #2's current XXX CPU warranty and R/1000metrics are excellent. Reliability experts are trained and implementing robustness and reliability techniques thru theproduction process. PPM/Delivery metrics are BIC. Strong QOS (BMW, Saturn, DCX) in place, including BICFMEA's, control plans, APQP. Processes are capable. CPk levels for Saturn XXX's range from 1.63 CPk to 5.78CPk. Outstanding Lean implementation. Scrap/Rework improved by 20% and efficiency by 10% from 2000 to 2001.Evidence shows Supplier #2 has a Skills Assessment Training Plan that is standard in their APQP checklist. Existingprocesses to be used for manufacturing limiting new technology risk. Strong desire to bring supplier into Ford supplybase.

* Supplier #2

Rationale for Consensed Supplier (including Supplier's Strengths)

Page 2

Key Supplier Challenges:

The proposed new site will utilize experienced production personnel from an existing site. Supplier to establish ansupport staff in NA to provide engineering expertise to the proposed Greenfield Site. A detailed Design andManufacturing work plan will be provided by <SC> and reviewed with Product Engineering, Purchasing andManufacturing at all regular program meetings.

SUPPLIERS IN RANK ORDER

Site Location #2

Workplan to Overcome Challenges:(to be included in Sourcing Agreement)

This supplier is new to the Ford NA supply base. The proposed site is a Greenfield Site in NA while both Engineeringand Manufacturing Centers of Excellence are located in Europe.

* Supplier #2

*Supplier #3

Supplier #6

Supplier #1

Supplier #4

* Supplier #5

Supplier Name Site Location Surrogate Site Location

Site Location #2

TBD



Site Location #6

Site Location #1

Site Location #4

TBD Surrogate Site Location #5

Content Contact: C. Green (CGREEN)Format Contact: B. Fagerson /L. Blair-Johnson 05 ssqe-exec_summary_sample.xls


Revision: 10

Page 1


Executive Summary

Vehicle Program / Model Year:

Commodity:

XXX / 2005

Door Trim Panels

Content Contact: C. Green (CGREEN)Format Contact: B. Fagerson /L. Blair-Johnson05 ssqe-exec_summary_sample.xls


Revision: 10



Supplier Quality Segmentation


Participant Guide





© 2001, 2006 Ford Motor Company

This document contains information that may be proprietary. The contents of this document may not be duplicated by any means

without the prior written permission of Ford Motor Company.





Introduction to Supplier Quality Segmentation


1




Course Overview

� Purpose

– This course focuses on the segmentation methods and metrics

necessary to manage the supply base effectively.

� Goal

– The goal of this course is to help Ford Personnel understand the

quality segmentation process & how to manage a supplier site

appropriately.

Notes

• The Supplier Quality Segmentation course is part of the Corporate Quality Development curriculum.

• You will learn what the segmentation process is, how it is used to manage the allocation of limited resources to support those suppliers in need, how to make a segmentation change and the outcome of this change.

2




Objectives

� Upon completion of this course, you will be able to do the

following:

1. Explain the purpose of Supplier Quality Segmentation

2. Describe the Segmentation Model

3. Identify the various STA Ford Personnel responsibilities in the Segmentation Process

4. Know how to complete a Segmentation Change Request Form

& the Segmentation Overlay Change Request Form

3




GlobalSupplier Quality Segmentation

Training

GlobalSupplier Quality Segmentation

Training

Course Structure

Introduction to Supplier Quality SegmentationIntroduction to Supplier Quality Segmentation

Completing a Segmentation Change Request Completing a Segmentation Change Request

This course is divided

into two parts.

This course is divided

into two parts.

Notes

Introduction to Supplier Quality Segmentation:

• Explores the Quality Segmentation Model, how it is applied to different supplier situations and how to make segmentation determination.

• Explains the process of how to complete a Segmentation Change Request and the outcome after submission.

• Assigning and tracking supplier segmentation is one of the STA Site Engineer’s responsibility.

• The Supplier Quality Segmentation course includes additional documentation such as appendices to refer to.

4




What Is Supplier Quality Segmentation?

� Supplier Quality Segmentation is:

– A process that focuses technical resources towards specific suppliers

– A method to align quality improvement efforts towards Customer Satisfaction and Safety

– A data model based on Q1 and Commodity Prioritization

– A method to heighten awareness where resources are needed

Notes

• Supplier Quality Segmentation is a method of determining the level at which a Supplier’s Q1 performance and continuous improvement efforts should be monitored.

• Suppliers who provide Low Impact on customer Satisfaction & Safety parts and have a history of good performance require very different management techniques from suppliers who provide High Impact on Customer Satisfaction & Safety parts and have a history of issues.

• This process examines each supplier site’s product and production history to determine the risk posed by that supplier site to the overall success of a program.

5




What Is Supplier Quality Segmentation?

� Supplier Quality Segmentation is:

– A process that focuses technical resources towards specific Suppliers

– A method to align quality improvement efforts towards Customer Satisfaction and Safety

– A data model based on Q1 and Commodity Prioritization

– A method to heighten awareness where resources are needed

Segmentation will help the company reach four important goals:• Improving Quality• Improving Quality• Assuring Safety• Improving Customer Satisfaction

Notes

• Segmentation helps to identify suppliers of high and low risk based on their status.

• When the supplier site has been segmented properly, the Supplier Technical Assistance organization or STA can prioritize the application of STA resources, providing the most value from limited resources. This will help the company reach four important goals:

- Improve Quality

- Improve Quality

- Assure Safety and

- Improve Customer Satisfaction.

• Segmentation is not a punitive process but rather is used to identify suppliers of high and low risk. It allows Ford to tailor actions and different supplier relationships depending on the supplier status.

6




Why Segment Suppliers?

The supply base is segmented in order to:

– Standardize the allocation of STA resources based on Q1 & impact on Customer Satisfaction & Safety

– Align continuous improvement efforts with a quality, safety andcustomer satisfaction focus

– Develop a standardized method to evaluate Supplier Performance

– Optimize limited STA resources

Notes

Why do we segment Suppliers? The supply base has been segmented for four specific reasons:

• Standardize the allocation of STA resources based on Q1 and Impact on Customer Satisfaction & Safety.

• Align continuous improvement efforts with a Quality, Safety and Customer Satisfaction focus.

• Develop an efficient, standardized method to evaluate supplier performance.

• Optimize limited STA resources for maximum effectiveness.

7




Benefits of Quality Segmentation

Segmentation achieves the following:

– Defines the process for focusing STA resources

– Prioritizes improvement efforts on commodities that have a larger impact on customer satisfaction and safety

– Aligns Purchasing priorities with corporate objectives

– Promotes the development of self-reliant Suppliers

– Provides new STA Engineers with an environment where it is possible to practice supplier improvement rather than crisis management

– Allows Purchasing and all of Ford to focus on higher risk suppliers

Notes

Among other benefits, segmentation helps:

• Define the process for focusing STA resources based on the supplier’s commodity & performance. This helps us predict resources needed to provide supplier support.

• Prioritize Company involvement on commodities that have a larger impact on customer satisfaction and safety.

• Improve vehicle quality, safety, and customer satisfaction through consumer and corporate focused priorities.

• Promote the development of self reliant suppliers.

• Provide new STA Engineers with an environment where it is possible to practice supplier improvement rather than crisis management.

• Allows a way for Ford personnel to focus on higher risk suppliers.

8




Quality Segmentation Model

Suppliers are grouped into segments which allows purchasing to dSuppliers are grouped into segments which allows purchasing to differentiate ifferentiate between suppliers to apply the appropriate level of technical rebetween suppliers to apply the appropriate level of technical resource. source.

OUTSTANDINGOUTSTANDING��

(Q1 Status)

II. SignificantLow Impact on Customer Satisfaction / SafetyNon Q1 – High Risk

IV. AutonomousLow Impact on Customer Satisfaction / SafetyQ1 - Low Risk

III. ExperiencedHigh Impact on Customer Satisfaction / SafetyQ1 – Low Risk

I. Critical

High Impact on Customer Satisfaction / SafetyNon Q1- High Risk

��

��

HIGHHIGH

LOWERLOWER

Segment 1 or 2: Segment 1 or 2: Q1 Status Revocation (R) Q1 Status Revocation (R)

or Approval Denied (X)or Approval Denied (X)

Segment 3 or 4: Segment 3 or 4: Q1 Status Approved (Y)Q1 Status Approved (Y)

or Waived & in Good Standing (W)or Waived & in Good Standing (W)

Notes

• This is the Supplier Quality Segmentation Model. Suppliers are grouped into

segments which allows Purchasing and STA to differentiate between different

suppliers and allows purchasing to provide the appropriate level of resources.

• The Quality Segmentation Model is found within the definition section of the

Quality Supply Base Segmentation Standard called PSS-001.You should print out

this model for future reference. The model can be found in the following link:

http://www.purchasing.ford.com/prch_sta_man/html/segmentation.htm

9






II. Significant IV. Autonomous

III. ExperiencedI. Critical

��

(Q1 Status)

��

��

HIGHHIGH

LOWERLOWER OUTSTANDINGOUTSTANDING

Notes

• Horizontal axis: Suppliers are classified based upon their history and capability (Q1 status). A supplier already successfully producing the product for Ford will be placed to the right. A new supplier that has not had previous Ford quality production history would be placed to the left.

• Vertical axis: Measures the commodity or product impact on customer satisfaction or safety. The top half includes suppliers that produce commodities that have a high impact on Customer Satisfaction and Safety while the bottom half includes suppliers that produce commodities that have lower impact on Customer Satisfaction and Safety.

10






II. SignificantLow Impact on Customer

Satisfaction / SafetyNon Q1 – High Risk

IV. AutonomousLow Impact on Customer

Satisfaction / SafetyQ1 - Low Risk

III. ExperiencedHigh Impact on Customer

Satisfaction / SafetyQ1 – Low Risk

I. CriticalHigh Impact on Customer

Satisfaction / SafetyNon Q1- High Risk

��

(Q1 Status)

��

��

HIGHHIGH


Notes

• The segmentation determination is about risk to the program, to Ford and to the customer.

11






II. IV. AutonomousLow Impact on Customer




I.

��

(Q1 Status)

��

��

HIGHHIGH


Notes

• The lower risk sites are located on the right.

• These are suppliers that have high supplier manufacturing capability or Q1 status.

12






II. IV.



I.

��

(Q1 Status)

��

��

HIGHHIGH


Notes

• The segmentation is further divided based upon the Customer Satisfaction or Safety impact of the part produced.

• If there is High Impact on Customer Satisfaction & Safety, the supplier is placed in segment 3: Experienced.

13






II. IV. AutonomousLow Impact on Customer


III. I.

��

(Q1 Status)

��

��

HIGHHIGH


Notes

• If the Impact is Low on Customer Satisfaction & Safety, the supplier is assigned segment 4: Autonomous.

• In either case, the suppliers on the right side require less Ford involvement and attention.

14








IV.

III. I. CriticalHigh Impact on Customer


��

(Q1 Status)

��

��

HIGHHIGH


Notes

• The higher risk suppliers are located on the left.

• These are suppliers that have low supplier manufacturing capability or NON Q1 Status. This can be due to poor performance or new product introduction which has no production history.

• The left side is segmented into two parts based upon Customer Satisfaction or Safety impact on the part produced.

15






II. IV.

III. I. CriticalHigh Impact on Customer


��

(Q1 Status)

��

��

HIGHHIGH


Notes

• If there is High Impact on Customer Satisfaction & Safety, the supplier is placed in segment 1: Critical.

16








IV.

III. I.

��

(Q1 Status)

��

��

HIGHHIGH


Notes

• If the Impact is Low on Customer Satisfaction & Safety, the supplier is assigned segment 2: Significant.

• Suppliers on the left side require more Ford involvement and attention.

17














��

(Q1 Status)

��

��

HIGHHIGH


Notes

• If a supplier has a good Q1 status and has High Impact on Customer Satisfaction & Safety such as an instrument panel, seat, or bumper they will only be assigned to segment 3.

18














��

(Q1 Status)

��

��

HIGHHIGH


Notes

• An item such as a spring may not be as critical so it would be assigned segment 4.

19














��

(Q1 Status)

��

��

HIGHHIGH


Notes

• The higher risk sites are located on the left.

• Higher risk suppliers are placed in Segment 1: Critical and Segment 2: Significant. These suppliers will require more Ford involvement.

• The lower risk sites are located on the right.

• The top half includes suppliers that produce commodities that have a high impact on Customer Satisfaction & Safety. The bottom half includes suppliers that produce commodities that have lower impact on Customer Satisfaction & Safety.

• The STA Engineer’s focus is to help suppliers reach and stay in either segment 3 or 4.

20








��

(Q1 Status)

��

��

HIGHHIGH


Note:

• Suppliers with previous history beginning to produce new product will be placed in the left segment.

• A site is categorized as having a High Impact on Customer Satisfaction & Safety if it has at least one commodity designated as High Impact on Customer Satisfaction Safety.

Notes

• Please note that even if the supplier does have a previous history with Ford producing one product, if they begin to produce a totally new product, they will be placed to the left.

• Also a site is categorized as having a High Impact on Customer Satisfaction & Safety if it has at least one commodity designated as High Impact on Customer Satisfaction Safety. We will cover these in a few examples later on.

21




Overlay: A label given to sites to identify a special case where a

site does not fit into the normal rules of segmentation. The

purpose of an overlay is to either add or remove resources

based on the impact that a site has on Ford Motor Company.

The three categories are Quality, Launch & Limited

Involvement.

Overlays

Notes

• The Quality Segmentation process “Overlay” allows suppliers to be segmented outside the normal rules of segmentation depending on the regional STA leader’s discretion.

• The “Segmentation Overlay Change Request Flow” will be reviewed in the 2nd

segment of this course.

22




� “Quality” Overlay is a label given to a supplier with a Q1

status approved “Y” (Segment 3 or 4) that would be allowed to

be segmented in Segment 1 or 2 based on the manager’s

discretion to apply more resources to correct issues at the

supplier.

Quality Overlay

Notes

• The first to review is the Quality Overlay. A "Quality” Overlay is a label given to a supplier with a Q1 status approved “Y” (Segment 3 or 4) that would be allowed to be segmented in Segment 1 or 2 based on the manager’s discretion to apply more resources to correct issues at the supplier.

23







I. Critical


��

��

HIGHHIGH

LOWERLOWER

OUTSTANDINGOUTSTANDING




or Waived & in Good or Waived & in Good Standing (W)Standing (W)

��

(Q1 Status)

•The Q1 Site, Segment 3 or 4 would move to a non Q1 Segment 1 or 2.

•The STA Engineer re-evaluates at six months for potential re-segmenting or Q1 Status change.

Quality Segmentation Model: Quality Overlay

Notes

• After 6 months, the supplier site must either have their Q1 status change to “R”(Revocation) or they must be re-segmented to segment 3 or 4 based on the Safety/Customer Satisfaction impact of their commodity.

• The process requires regional STA leader’s approval prior to segmenting.

24




� “Launch” Overlay is a label given to a Q1 approved supplier,

status of “Y”, (Segment 3 or 4) that requires additional STA

resources due to the support of a new model launch or to

mitigate risk at a site due to increased business through re-

sourcing actions.

Launch Overlay

Notes

• A “Launch” Overlay is a label given to a Q1 approved supplier, status of “Y”, (Segment 3 or 4) that requires additional STA resources due to the support of a new model launch or to mitigate risk at a site due to increased business through re-sourcing actions.

25




Quality Segmentation Model: Launch Overlay




I. Critical


��

��

HIGHHIGH

LOWERLOWER






��

(Q1 Status)

•The Q1 site, would remain a segment 3 or 4, however would be treated as a non Q1 segment 1 or 2.

Notes

• The Q1 site would remain a segment 3 or 4, however would be treated as a non Q1 site as a segment 1 or 2. Thus no segment change is required here, but the resource requirement does change. Again, it's treated as a segment 1 or 2, but remains a segment 3 or 4.

26




� “Limited Involvement” Overlay is a label given to a non Q1

supplier with a Q1 status Revocation (R) or Denied (X) that

requires a reduction in STA resources.

Limited Involvement Overlay

Notes

• The last one is the Limited Involvement Overlay. A Limited Involvement” Overlay is a label given to a non Q1 supplier with a Q1 status Revocation (R) or Denied (X) that requires a reduction in STA resources.

27




Quality Segmentation Model: Limited Involvement Overlay




I. Critical


��

��

HIGHHIGH

LOWERLOWER






��

(Q1 Status)

•The non Q1 site, would remain a segment 1 or 2, however would be treated as a Q1 segment 3 or 4.

Notes

• The non Q1 site would remain a segment 1 or 2, however would be treated as a Q1 site as a segment 3 or 4. Thus no segment change is required here, but the resource requirement does change. Again, it's treated as a segment 3 or 4, but remains a segment 1 or 2.

28




� This category should be used when one of the following applies:

– An organization outside STA has accepted responsibility & applied

resources to manage non quality improvement actions (e.g. Delivery or

Environmental.)

– The site is classified short-term eliminate (STE) or equivalent & has an

acceptable site assessment action plan that creates limited risk to Ford

Motor Company.

– Has acceptable quality performance and Q1 will be awarded upon receipt

of the following certification: (ISO/TS16949 or QS9000, and ISO14001)

and acceptable assessment to MMOG or MS9000 or ODETTE.


Notes

• The Limited Involvement Overlay should be used when one of the following applies:

- An organization outside STA has accepted responsibility & applied resources to manage non quality improvement actions. (e.g. Delivery or Environmental).

- The site is classified short-term eliminate (STE) or equivalent & has an acceptable site assessment action plan that creates limited risk to Ford Motor Company.

- Has acceptable quality performance Q1 will be awarded upon receipt of certification (QS9000, ISO/TS16949, SIO14001, MMOG/MS9000/ODETTE).

29







I. Critical


��

��

HIGHHIGH

LOWERLOWER






��

(Q1 Status)

•Quality Overlay requires a segment change.

•Launch Overly does not require a segment change.

•Limited Overlay does not require a segment change.

Quality Segmentation Model: Overlay’s

Notes

• The Quality Overlay is the only one that requires a segment change. However, all three require the submission of a "Segmentation Overly Change Request Form" as we will be reviewing in the next part of the course.

30








�� (Q1 Status)

��

��

SIM Website for Site Q1 Status Code link found at

http://www.purchasing.ford.com/prch_quality/html/search.html

Commodity Prioritization List link found at http://www.purchasing.ford.com/prch_sta_

man/html/segmentation.htm

Procedure PSP-010 link found at http://www.purchasing.ford.com/prch_sta_

man/html/segmentation.htm

Notes

• A manufacturing site’s individual quality performance, Q1 status, and the Customer Satisfaction and Safety of its commodities dictate the category.

• Commodities are designated as having high or low impact on Customer Satisfaction & Safety, per the Commodity Prioritization List.

• The Buyer and STA Engineer will reference the Commodity Prioritization List to identify the supplier part for impact on Customer Satisfaction & Safety.

• They will also reference Procedure “Q1 for External Suppliers of Production & Service Parts Number PSP-010 & SIM” to obtain the supplier’s Q1 status.

• Remember: the Q1 status and commodity impact together determine the segment assignment.

• There are 5 Q1 status codes which are applicable to segmentation: Y, W, X, R & A (See Procedure PSP-010 for additional reference).

31





Suppliers are grouped into segments which allows purchasing to dSuppliers are grouped into segments which allows purchasing to differentiate between ifferentiate between suppliers to apply the appropriate level of technical resource. suppliers to apply the appropriate level of technical resource.




I. Critical


��

��

HIGHHIGH

LOWERLOWEROUTSTANDINGOUTSTANDING





��

(Q1 Status)

Notes

• A site with Q1 approved status “Y, Q1 Achieved” or “W-Waived and in good

standing” are to be segmented to the right, segments 3 or 4.

• The site engineer’s objective is to focus their efforts to move the supplier

from a 1 to a 3 or 2 to a 4 and maintain them there.

• The goal is to have all the suppliers in Segment 3 or 4. This lowers risk to

the customer and to Ford.

32









I. Critical

High Impact on Customer Satisfaction / Safety

Non Q1- High Risk

��

��

HIGHHIGH






��

(Q1 Status)

Notes

• As a reminder, this is not a punitive model but is used to identify suppliers of high and low risk. A supplier who has had previous history with Ford producing a part has a lower level of risk than the supplier new to Ford producing a new part.

• The purpose of this model is to identify suppliers with higher levels of risk so that more resources can be brought to bear to minimize that risk.

33









I. Critical


��

��

HIGHHIGH






��

(Q1 Status)

Sites with a status code of “A- Awaiting Q1 approval” are to be segmented along the x axis (the left or right side of the model) based on the STA manager’s discretion.

Sites with a Q1 Status code of “D – Requiring Disposition”should not be segmented and require an alternate Q1 status prior to segmenting.

Notes

• There are a few unique situations to be mentioned here: Sites with a status code of “A - Awaiting Q1 approval” are to be segmented along the x axis (the left or right side of the model) based on the STA manager’s discretion. Sites with a Q1 Status code of “D – Q1 Site Assessment Required” should not be segmented and require an alternate Q1 status prior to segmenting. We will discuss these codes later in the second part of course.

34









I. Critical


��

��

HIGHHIGH






��

(Q1 Status)

Notes

• When a Q1 Status Code is changed from Y or W to R or X respectively, the supplier's segment will be changed from 3 or 4 to 1 or 2 respectively.

• Notice that assuming the supplier does not change the products that it makes, the movement is only horizontal. The supplier is moved from segment 3 to 1 or from segment 4 to 2. In these cases it will be necessary to file a Segmentation Change Request. This will be the subject of the second part of course.

35




Quality Segmentation Model: Example




I. Critical


��

��

HIGHHIGH

LOWERLOWER






��

(Q1 Status)

Supplier #1: J&J Company

•J&J has recently started producing Odometers, a Low Impact on Customer Satisfaction & Safety Item, for one of the SUV’s

•J&J is a relatively new supplier to Ford

•Recently lost their Q1 Status due to poor quality

What do you think their segmentation designation would be?

See next slide for answer.

Notes

• Let’s look at a few examples. Please remember both your Segmentation Model & Commodity Prioritization List are the two references when determining your site segment.

• For our first example let’s look at the J&J Company: J&J Company has been producing Odometers which is Low Impact on Customer Satisfaction & Safety for Ford on one of our SUV's. J&J is relatively new to Ford but has received great praise throughout the industry as a company that provides a quality product. Recently J&J had had some quality problems with their product and as a result has lost their Q1 status. Based upon the information what do you think their segmentation designation would be?

36








I. Critical


��

��

HIGHHIGH

LOWERLOWER






��

(Q1 Status)

Supplier #1: J&J Company

•J&J has recently started producing Odometers, a Low Impact on Customer Satisfaction & Safety Item, for one of the SUV’s

•J&J is a relatively new supplier to Ford

•Recently lost their Q1 Status due to poor quality

Notes

• If you answered “2: Significant” you are right… Because they are producing a product that has Low Impact on Customer Satisfaction & Safety and recently have lost their Q1 status they should receive a Segment designation of “2: Significant”. Thus moving the segment from 4: Autonomous to 2: Significant.

• Repeat the analysis assuming J&J makes a High Impact on Customer Satisfaction & Safety Item. The segment would then move from 3: Experienced to 1: Critical.

37








I. Critical


��

��

HIGHHIGH

LOWERLOWER






��

(Q1 Status)

Supplier #2: LMS Enterprises

•LMS produces retaining clips for door panels, a Low Impact on Customer Satisfaction & Safety Item

•Was High Risk – Non Q1, recently regained Q1 Status

•They are coming up for their monthly review



Notes

• The second example is LMS Enterprises: LMS produces retaining clips, Low Impact on Customer Satisfaction & Safety, for door panels for Ford. LMS is currently classified as High Risk – Non Q1. Recently, they regained their Q1 Status. Now it is time for their monthly review. What should their segmentation designation be for the next month?

38








I. Critical


��

��

HIGHHIGH

LOWERLOWER






��

(Q1 Status)

Supplier #2: LMS Enterprises

•LMS produces retaining clips for door panels, a Low Impact on Customer Satisfaction & Safety Item

•Was High Risk – Non Q1, recently regained Q1 Status

•They are coming up for their monthly review

Notes

• If you decided that the designation would change to “4: Autonomous” you were right… because they have Q1 status and produce a product that has a Low Impacton Customer Satisfaction & Safety they should receive segmentation status “4: Autonomous” thus this site has moved from a Segment 2: Significant to 4: Autonomous.

• Again, repeat the analysis assuming LMS makes a High Impact on Customer Satisfaction & Safety Item. The segment would then move from 1: Critical to 3: Experienced.

39








I. Critical


��

��

HIGHHIGH

LOWERLOWER






��

(Q1 Status)

Supplier #3: ABC Company

•Q1 provider of Door Latches & Body Side Moulding

•Door latches are considered High Impact on Customer Satisfaction & Safety items –contract expired

•Body Side Mouldings are considered Low Impact on Customer Satisfaction & Safety items



Notes

• Let’s look at another example: ABC has been a long time quality provider of Door Latches & Body Side Molding to Ford Motor Company. Door latches are identified as High Impact to Customer Satisfaction & Safety & Body Side Molding are Low Impact to Customer Satisfaction & Safety. They have held Q1 Status for their latch assemblies & Body Side Moldings for 3 years. Therefore, they held a segmentation rating of “3: Experienced” for that period. Recently their contract expired for the Door Latches.

• Based upon the information what do you think their segmentation designation would be?

40








I. Critical


��

��

HIGHHIGH

LOWERLOWER






��

(Q1 Status)

Supplier #3: ABC Company

•Q1 provider of Door Latches & Body Side Moulding

•Door latches are considered High Impact on Customer Satisfaction & Safety items –contract expired

•Body Side Mouldings are considered Low Impact on Customer Satisfaction & Safety items

Notes

• If you decided that the designation is “Segment 4: Autonomous” you were right…their only High Impact on Customer Satisfaction & Safety part is being eliminated, therefore leaving only a Low Impact on Customer Satisfaction part, thus designation of segment 4: Autonomous. Again, both the Q1 Status & Impact on Customer Satisfaction & Safety determine the segment. As these examples show several factors need to be taken into account when making segmentation assignments. Each product must be taken into account as well as the Q1 status of the facility. Further this assessment is reviewed and updated annually.

41




Summary

FMEA Control PlansPhased PPAPGlobal 8D Analysis

SPCDOELean ManufacturingSix- Sigma

Q1

Segmentation Process Quality Tools



��

(Q1 Status)

��

��

For additional Q1 Information:http://www.purchasing.ford.com/prch

_sta_man/html/Q1Information.html

Notes

• The site engineer’s objective is to focus his/her efforts to move the supplier from a 1 to a 3 or 2 to a 4 and then maintain them there.

• Segmentation is an important part of the overall quality picture. It provides a method to guide the focus for applying a wide variety of quality tools such as FMEA, Control Plans and Six Sigma. These tools will result in improved segmentation assignment and ultimately improved quality.

• In the next part of the course we will explore the process for registering the assigned segmentation designation into the SIM system. In addition, we will explore how to make a Segmentation Request and the process when the request is submitted.

42





Documenting Assigned Segmentation


43




Objectives

� Upon completion of this course, you will be able to do the

following:

1. Identify the various STA Ford Personnel responsibilities in the Segmentation Change Request Flow Chart

2. Complete a Segmentation Change Request Form

Notes

For this part of the course, you will utilize the following 2 documents:

• Segmentation Change Request Flow Chart

• Segmentation Change Request Form

Please ensure you have them in your material prior to proceeding. They

are also available at:

http://www.edrwas.ford.com/launchomatic/launch/view.jsp?chronicleld=

9000c51804d57b7&docbase=edrdoc1


44




Segmentation Change Request Form

Notes

• Once the segmentation designation is completed, the value must be assigned in the SIM system for that supplier.

• In most cases, suppliers are already segmented. For a new site or initial segmentation, the segmentation designation will be determined based upon the initial site assessment, which will be discussed later.

• The purpose of the Segmentation Change Request Form is to make a segmentation change.

• The Segmentation Change Request Flow Chart in the next page explains the process of completing the form including roles and responsibilities.

45




��

��

Segmentation Change Request Flow Chart

STASite Engineer

STA Site Manager

SBO-Segmentation

Leader

STAGSDB

2AHas the Q1

Status Changed

to "Y" or "W"?

2B Has the Q1

Status Changed to "R" or "X"?

2C Q1 Status

Changed to "A" Segmentation at STA Manager's

Discretion

3BIf High Impact on Cust. Sat./Safety

move to Seg. IIf Low Impact on Cust. Sat./Safety

move to Seg. II

No

4BComplete the

Form/Equivalent Spread Sheet by

adding the Current STA Organization Code & Obtain the

Current Site Manager's Signature

6B Receive

Form/Equivalent Spread Sheet & Update

Segmentation of the site.

To activate the Link to the Quality Segmentation Home page:Right click the Legend Box & scroll down to the Segmentation Home Page & select.

(http://www.purchasing.ford.com/prch_sta_man/html/segmentation.htm)

4ADoes the Current STA

Organization Code Change?

5AComplete the

Form/Equivalent Spread Sheet by Adding the Current & New STA

Org. Codes & the New STA Eng's. Name & CDSID. Obtain the Current & New Site

Manager's Signatures

7BUpdate Org Code

& STA Engineer in GSDB (SIM Updated)

7AIs the STA Org Code

Changing?

8Retain Copy for 3

years per STA Quality Records

Matrix

Yes

3AIf High Impact on Cust. Sat./Safety move to Seg. IIIIf Low Impact on Cust. Sat./Safety move to Seg. IV

No

Yes

No

5BObtain the Current & New Site Manager's

Signatures

4CObtain the Current

Site Manager's Signature

No

Yes

1AIs this an Existing

Site?(Monthly Reviews Recommended)

Legend: Definition: The Impact on Customer Satisfaction & Safety with Q1 Status Code both dictate the Segment l, ll, lll or lV.Q1 Codes Recognized for Segmentation Process: A,Y,R,X,& W; others are not.Q1 Status - A code that defines whether or not a supplier manufacturing location meetsthe minimum quality requirements for doing business with Ford Motor Company. See PSP-010 & Q1 Book.1A Evaluate Site for Potential Segmentation Change. Monthly Reviews Recommended. 1B.A site with a Q1 Status code of "D" (Disposition required, risk not assessed) requires a site assessment and assignment of the appropriate Q1 status code (other than "D") before it can be segmented. Once assessed for risk and with a Q1 status code other than "D", the site becomes an existing site, go back to 1A. See PSP-010 for an explanation of the Q1 status codes. Q1 Site Assessment Required (D) is the default code upon site activation. 2A. See Std. PSS-001 4.1.52B. See Std. PSS-001 4.1.122C. See Std. PSS-001 4.1.93A, 3B See PSS-001 Segmentation Model4A,4B, 4C/5A,5B. A meeting between the two responsible areas of the described organizational code. Not applicable to Europe.

Yes Yes

6AFax or email the Completed

Form/Equivalent Spread Sheet to SBO Segmentation

1BIs this a New Site/Initial

Segmentation? (Q1 Site Assessment

Required. See Legend)

Notes

• The Segmentation Process Flowchart defines the roles, responsibilities, documents, forms, and timing of all activities within the segmentation change process.

46




STASite Engineer

STA Site Manager

SBO-Segmentation

Leader

STAGSDB

2AHas the Q1

Status Changed

to "Y" or "W"?

2B Has the Q1


2C Q1 Status


Discretion



move to Seg. II

No

4BComplete the




6B Receive







5AComplete the




7BUpdate Org Code



Changing?

8Retain Copy for 3


MatrixYes


No

Yes

No


Signatures



No

Yes




Yes Yes






��

��

Segmentation Change Request Flow Chart : Roles

Notes

• The left column list WHO is involved in this process.

• The STA Engineer is responsible for assessing the risk level and assigning the segmentation designation.

47




STASite Engineer

STA Site Manager

SBO-Segmentation

Leader

STAGSDB

2AHas the Q1

Status Changed

to "Y" or "W"?

2B Has the Q1


2C Q1 Status


Discretion



move to Seg. II

No

4BComplete the




6B Receive







5AComplete the




7BUpdate Org Code



Changing?

8Retain Copy for 3


MatrixYes


No

Yes

No


Signatures



No

Yes




Yes Yes






��

��

Segmentation Change Request Flow Chart : Workflow

Notes

• The body of the workflow displays a step by step approach to the Segmentation Change Process, itemized by role and time.

• Like a timeline, the left to right flow of the document indicates the passage of time.

• Each person has an individual row describing his or her respective tasks.

48




STASite Engineer

STA Site Manager

SBO-Segmentation

Leader

STAGSDB

2AHas the Q1

Status Changed

to "Y" or "W"?

2B Has the Q1


2C Q1 Status


Discretion



move to Seg. II

No

4BComplete the




6B Receive







5AComplete the




7BUpdate Org Code



Changing?

8Retain Copy for 3


MatrixYes


No

Yes

No


Signatures



No

Yes




Yes Yes






Segmentation Change Request Flow Chart : Elapsed Time

��

��

Notes

• Stacked items represent simultaneous activities. Each column represents a

discrete time interval during which a task is completed, either together or

independently.

49




STASite Engineer

STA Site Manager

SBO-Segmentation

Leader

STAGSDB

2AHas the Q1

Status Changed

to "Y" or "W"?

2B Has the Q1


2C Q1 Status


Discretion



move to Seg. II

No

4BComplete the




6B Receive







5AComplete the




7BUpdate Org Code



Changing?

8Retain Copy for 3


MatrixYes


No

Yes

No


Signatures



No

Yes




Yes Yes






Segmentation Change Request Flow Chart : Legend

��

��

Notes

• The legend box contains notes on each task. It provides specific directions and/or references to additional resources that can be found on the Quality Segmentation homepage.

50




STASite Engineer

STA Site Manager

SBO-Segmentation

Leader

STAGSDB

2AHas the Q1

Status Changed

to "Y" or "W"?

2B Has the Q1


2C Q1 Status


Discretion



move to Seg. II

No

4BComplete the




6B Receive







5AComplete the




7BUpdate Org Code



Changing?

8Retain Copy for 3


MatrixYes


No

Yes

No


Signatures



No

Yes




Yes Yes






Segmentation Change Request Process Workflow

��

�� !��

1AIs this an existing Site?

(Monthly reviews Recommended)

STA Site Engineer initiates a Segmentation Change Request• Existing Site

• Evaluate site for potential segmentation change• Monthly reviews recommended

• New Site • Q1 Site Assessment Required (should not be

segmented & should be assigned a Q1 Status)• “D” (default code upon site activation)

1BIs this a New Site/ Initial Segmentation?

Q1 Site Assessment Required. See Legend.

Notes

• Refer to the Segmentation Change Request Form and Flowchart during this part of the course.

• Step 1: The STA Site Engineer initiates a segmentation change request either when it is an existing or it is a New Site/Initial Segmentation with the following criteria:

If it is an existing site, the STA Site Engineer re-evaluates the site for a potential segmentation change with each monthly update in SIM. If this is the case, then proceed to Step 2.

• It is classified a new site if a Q1 site assessment is required for the first time. Site assessments are required every year or 6 months for existing sites.

• A site with a Q1 Status code of “D” needs a Q1 site assessment prior to the assignment of segmentation. Once assessed for risk and with a Q1 status code other than “D”, the site becomes an existing site. Go back to Step 1A. See Q1 PSP-010 for an explanation of the Q1 status codes.

• A segmentation change request form is not used on a “D” site. This is the default value in the system upon activation of a new site.

• Recall from part 1 of this course, segmentation is about assigning risk. If a site assessment has not yet been conducted and the Q1 result recorded, you cannot assess the risk.

51




��

��

STASite Engineer

STA Site Manager

SBO-Segmentation

Leader

STAGSDB

2AHas the Q1

Status Changed

to "Y" or "W"?

2B Has the Q1


2C Q1 Status


Discretion



move to Seg. II

No

4BComplete the




6B Receive







5AComplete the




7BUpdate Org Code



Changing?

8Retain Copy for 3


MatrixYes


No

Yes

No


Signatures



No

Yes




Yes Yes






2AHas the Q1 Status Changed to “Y” or “W”?

STA Engineer verifies Q1 Code via SIM (2A & 2B)

STA Site Manager’s Discretion (2C)

2BHas the Q1 Status Changed to “R” or “X”?


2CQ1 Status Changed to “A” Segmentation at

STA Manager’s Discretion

Notes

• The column highlighted determines which route to take depending on Q1 status. Paths 2A, 2B and 2C are used if the Q1 status has changed.

• Using the previously determined segmentation assignment, the STA Site Engineer will either go to 2A, 2B or 2C dependent upon the Q1 status.

• Note that 2C is used when a Q1 status changed to “A”. The segmentation is at the STA Site manager’s discretion.

52




STASite Engineer

STA Site Manager

SBO-Segmentation

Leader

STAGSDB

2AHas the Q1

Status Changed

to "Y" or "W"?

2B Has the Q1


2C Q1 Status


Discretion



move to Seg. II

No

4BComplete the




6B Receive







5AComplete the




7BUpdate Org Code



Changing?

8Retain Copy for 3


MatrixYes


No

Yes

No


Signatures



No

Yes




Yes Yes







2AHas the Q1 Status Changed to “Y” or “W”?

��

��

Notes

• Step 2A: Has the Q1 status changed to Y or W? If the answer is Yes, proceed to 3A. If the answer is No, then proceed to 2B.

• For additional information on Y or W codes, please refer to the link below: http://www.purchasing.ford.com/prch_quality/html/search.html

• Proceed to Step 3A in the next slide.

53




STASite Engineer

STA Site Manager

SBO-Segmentation

Leader

STAGSDB

2AHas the Q1

Status Changed

to "Y" or "W"?

2B Has the Q1


2C Q1 Status


Discretion



move to Seg. II

No

4BComplete the




6B Receive







5AComplete the




7BUpdate Org Code



Changing?

8Retain Copy for 3


MatrixYes


No

Yes

No


Signatures



No

Yes




Yes Yes






3AIf High Impact on Customer Satisfaction /Safety move to Segment lllIf Low Impact on Customer Satisfaction /Safety move to Segment lV

STA Engineer verifies Impact on Customer Satisfaction/Safety (Found in the Commodity Prioritization List)to determine segment placement lll or lV


��

�� II. SignificantLow Impact on Customer Satisfaction / SafetyNon Q1 – High Risk



I. Critical


��

��

HIGHHIGH

LOWERLOWER


Segment 1 or 2: Segment 1 or 2: Q1 Status Revocation (R) Q1 Status Revocation (R) or Approval Denied (X)or Approval Denied (X)



��

(Q1 Status)

Notes

• Referencing your segmentation model, Q1 coded “Y-Q1 Achieved” or “W-Q1 Requirements Waived and in good standing” are located in the right hand column or segment 3 or 4.

• If you recall from part 1, which segment the supplier is placed in is dependent upon the impact on Customer Satisfaction and Safety. If it is high impact the segmentation is 3 while low impact it’s 4.

54




��

��

STASite Engineer

STA Site Manager

SBO-Segmentation

Leader

STAGSDB

2AHas the Q1

Status Changed

to "Y" or "W"?

2B Has the Q1


2C Q1 Status


Discretion



move to Seg. II

No

4BComplete the




6B Receive







5AComplete the




7BUpdate Org Code



Changing?

8Retain Copy for 3


MatrixYes


No

Yes

No


Signatures



No

Yes




Yes Yes






4A Organizational codes available from STA Site Manager4B/C A meeting between the two responsible areas is held

• STA Eng. completes the form/equivalent Spreadsheet by adding the current STA Org. Code & Obtain Site Manager’s Signature

• STA Site Manager reviews & signs accordingly

Note: Not Applicable to Europe

4A/B&CDetermine the current STA Org.Code

4A – A change in Org. Code4B/C – No change in Org. Code


Link for Pro-forma Spreadsheet:http://www.purchasing.ford.com/prch_sta

_man/html/segmentation.htm

Notes

• The next step in the process refers to the STA organization code and determines if there is a change in this code for the site.

• Where groups depend upon the segmentation determination to assign resources and personnel, sites are sometimes moved from one organization code to another. In some groups the segmentation designation is not used to allocate personnel and resources and consequently the sites are not moved from one organization to another.

• For example, North America Vehicle and North America Powertrain do use this designation for resource allocation and the STA Organization Code and the sites are moved between organization to organization. If you are not sure if this is or is not a local practice, contact your local STA Site Manager.

• Remember: Do not use the Segmentation Change Request Form to change the organization code only. If this is what you are trying to do, you should use the GSM System or consult with your STA Site Manager. The primary purpose of the Segmentation Change Request Form is for a segmentation change based on Q1 status.

• During this step, a meeting between the two responsible areas is held to make the determination if the code has changed. Organizational codes are available from the respective STA Site Manager.

• If there is a change, the STA Engineer proceeds to Step 5A to record the new organization codes. If there is no change, in Step 4B the STA Engineer completes the form or equivalent spreadsheet by adding the current STA Organization Code and obtaining the STA Site Manager’s signature. The STA Site Manager reviews and signs accordingly.

• For multiple updates and if local practice allows it, you may use a spreadsheet pro-forma document instead of the change request form. If used, make sure that it has all the required fields. It is preferred that you use the Segmentation Change Request Form.

55




��

��

STASite Engineer

STA Site Manager

SBO-Segmentation

Leader

STAGSDB

2AHas the Q1

Status Changed

to "Y" or "W"?

2B Has the Q1


2C Q1 Status


Discretion



move to Seg. II

No

4BComplete the




6B Receive







5AComplete the




7BUpdate Org Code



Changing?

8Retain Copy for 3


MatrixYes


No

Yes

No


Signatures



No

Yes




Yes Yes





Required. See Legend) 5AComplete the Form/

Equivalent Spreadsheet

5A/BOrganizational Codes are available from STA Site Manager

A meeting between the two responsible areas is held

• STA Engineer completes the Form/Equivalent Spreadsheet by adding the current & new STA Org. Codes, the new STA Engineer’s Name & CDSID, & obtains current & new Site Managers’ signatures

• STA Site Manager reviews & signs accordingly

Note: Not Applicable to Europe


5BObtain Signatures

Notes

• Steps 5A and B refer to the process of changing organization codes.

• A meeting between the two responsible areas is held to make the determination if the organization code is changed. The organizational code is available from the respective STA managers.

• The STA Engineer completes the form by adding the current and new organization STA org. codes, the new STA Engineer’s name and CDSID, and obtains the current and new Site Manager’s signatures.

• 5B refers to obtaining the current and new Site Manager’s signatures on the form.

56




��

��

STASite Engineer

STA Site Manager

SBO-Segmentation

Leader

STAGSDB

2AHas the Q1

Status Changed

to "Y" or "W"?

2B Has the Q1


2C Q1 Status


Discretion



move to Seg. II

No

4BComplete the




6B Receive







5AComplete the




7BUpdate Org Code



Changing?

8Retain Copy for 3


MatrixYes


No

Yes

No


Signatures



No

Yes




Yes Yes






6ASTA Engineer Faxes or e-mails completed

Form/Equivalent to the SBO Segmentation Leader


6BSTA Segmentation receives Form/Equivalent

Spreadsheet & updates Segmentation of the site

Notes

• Once the form is completed, the STA Site Engineer faxes or emails the completed form to the SBO Segmentation Leader.

• The SBO Segmentation Leader receives the form and updates the segmentation of the site.

• Once received, the SIM System will reflect the change within 5 business days.

57




��

��

STASite Engineer

STA Site Manager

SBO-Segmentation

Leader

STAGSDB

2AHas the Q1

Status Changed

to "Y" or "W"?

2B Has the Q1


2C Q1 Status


Discretion



move to Seg. II

No

4BComplete the




6B Receive







5AComplete the




7BUpdate Org Code



Changing?

8Retain Copy for 3


MatrixYes


No

Yes

No


Signatures



No

Yes




Yes Yes






7A SBO Segmentation Leader

Determines if the STA Org. Code changed.


7BSTAGSDB: Update Org. Code & STA

Engineer in GSDB

Notes

• In the next step, the SBO Segmentation Leader validates if the STA Organization Code has changed on the Change Request Form. If yes, it is sent to the GSDB coordinator who updates the Organization Code and the STA Engineer. Once updated, the document moves on the Step 8.

• If there is no change in the Organization Code, the document progresses to Step 8 directly.

58




��

��

STASite Engineer

STA Site Manager

SBO-Segmentation

Leader

STAGSDB

2AHas the Q1

Status Changed

to "Y" or "W"?

2B Has the Q1


2C Q1 Status


Discretion



move to Seg. II

No

4BComplete the




6B Receive







5AComplete the




7BUpdate Org Code



Changing?

8Retain Copy for 3


MatrixYes


No

Yes

No


Signatures



No

Yes




Yes Yes






8SBO Segmentation Leader retains copy for

3 years per STA Quality Records Inventory Matrix


Notes

• Finally, in Step 8 the SBO Segmentation Leader retains a copy of the change request per the STA Quality Records Matrix.

• You have now completed one flow of a change from start to finish.

59




��

��

STASite Engineer

STA Site Manager

SBO-Segmentation

Leader

STAGSDB

2AHas the Q1

Status Changed

to "Y" or "W"?

2B Has the Q1


2C Q1 Status


Discretion



move to Seg. II

No

4BComplete the




6B Receive







5AComplete the




7BUpdate Org Code



Changing?

8Retain Copy for 3


MatrixYes


No

Yes

No


Signatures



No

Yes




Yes Yes






STA Engineer verifies a “R” or “X” Q1 Code

2BHas the Q1 Status

Changed to “R” or “X”?


Notes

• Referencing back to the second column and looking at option 2B. If there was a Q1 status of “R-Q1 Revoked” or “X-Q1 Approval Denied”, one would go to 3B.

60




��

��

STASite Engineer

STA Site Manager

SBO-Segmentation

Leader

STAGSDB

2AHas the Q1

Status Changed

to "Y" or "W"?

2B Has the Q1


2C Q1 Status


Discretion



move to Seg. II

No

4BComplete the




6B Receive







5AComplete the




7BUpdate Org Code



Changing?

8Retain Copy for 3


MatrixYes


No

Yes

No


Signatures



No

Yes




Yes Yes






3BIf High Impact on Customer Satisfaction & Safety move to Segment lIf Low Impact on Customer Satisfaction & Safety move to Segment ll

STA Eng. verifies Impact on Customer Satisfaction/Safety (Found in the Commodity Prioritization List)to determine Segment placement l or ll





I. Critical


��

��

HIGHHIGH

LOWERLOWER


Segment 1 or 2: Segment 1 or 2: Q1 Status Revocation (R) Q1 Status Revocation (R) or Approval Denied (X)or Approval Denied (X)



��

(Q1 Status)

Notes

• Referencing to the Segmentation Model, Q1 codes “R-Q1 Revoked” or “X-Q1 Approval Denied” are located in the left hand column. This means they would receive a Segmentation designation of either 1 or 2 based on if the supplier’s parts’have a high or low impact on Customer Satisfaction and Safety.

• If it is high impact on Customer Satisfaction and Safety, the designation is 1. If it is low impact on Customer Satisfaction and Safety, it is 2.

61




��

��

STASite Engineer

STA Site Manager

SBO-Segmentation

Leader

STAGSDB

2AHas the Q1

Status Changed

to "Y" or "W"?

2B Has the Q1


2C Q1 Status


Discretion



move to Seg. II

No

4BComplete the




6B Receive







5AComplete the




7BUpdate Org Code



Changing?

8Retain Copy for 3


MatrixYes


No

Yes

No


Signatures



No

Yes




Yes Yes






Continue the work process from Step 4A through Step 8 respectively




Notes

• Once you approach step 4, you will continue the work process from step 4A through step 8 as previously described. The major difference is in steps 2 and 3.

62




��

��

STASite Engineer

STA Site Manager

SBO-Segmentation

Leader

STAGSDB

2AHas the Q1

Status Changed

to "Y" or "W"?

2B Has the Q1


2C Q1 Status


Discretion



move to Seg. II

No

4BComplete the




6B Receive







5AComplete the




7BUpdate Org Code



Changing?

8Retain Copy for 3


MatrixYes


No

Yes

No


Signatures



No

Yes




Yes Yes






2CQ1 Status Changed to “A”STA Managers’ Discretion


Notes

• Referencing back to the second column and looking at the last option, 2C. If there is a Q1 status of “A-Awaiting Q1 Approval”, you would go to 3A or 3B based upon the Site Manager’s discretion.

63




��

��

STASite Engineer

STA Site Manager

SBO-Segmentation

Leader

STAGSDB

2AHas the Q1

Status Changed

to "Y" or "W"?

2B Has the Q1


2C Q1 Status


Discretion



move to Seg. II

No

4BComplete the




6B Receive







5AComplete the




7BUpdate Org Code



Changing?

8Retain Copy for 3


MatrixYes


No

Yes

No


Signatures



No

Yes




Yes Yes






3AIf High Impact on Customer

Satisfaction/ Safety move to Segment lllIf Low Impact on Customer Satisfaction/

Safety move to Segment lV

Based on STA Site Manager’s Discretion continue from 3A or 3B

Note: STA Site Management might elect to put a new site in Segmentlll or lV if the site is considered to be low risk based on no red issues in the site assessment.

3BIf High Impact on Customer

Satisfaction/ Safety move to Segment lIf Low Impact on Customer Satisfaction/

Safety move to Segment ll


Notes

• The Site Manager will make the assessment based upon their review of the risk at the site. Once assessed, the STA Engineer continues from 3A or 3B, respectively.

64




��

��

STASite Engineer

STA Site Manager

SBO-Segmentation

Leader

STAGSDB

2AHas the Q1

Status Changed

to "Y" or "W"?

2B Has the Q1


2C Q1 Status


Discretion



move to Seg. II

No

4BComplete the




6B Receive







5AComplete the




7BUpdate Org Code



Changing?

8Retain Copy for 3


MatrixYes


No

Yes

No


Signatures



No

Yes




Yes Yes







Continue the work process from Step 4A through Step 8 respectively



Notes

• Once you reach step 4, you will continue the work process from step 4A through step 8 as it was previously discussed.

• This completes the 3 different paths through the Segmentation Process Flowchart.

65




Summary

Quality Segmentation is:

� A process that focuses technical resources towards specific suppliers

� A method to align quality improvement efforts towards Customer Satisfaction & Safety

� A data model based on Q1 & commodity prioritization II. Significant

Low Impact on Customer Satisfaction / SafetyNon Q1 – High Risk



I. Critical


��

��

HIGHHIGH

LOWERLOWER






��

(Q1 Status)

Notes

• Remember: Quality Segmentation is a structured process that is used to

focus technical resources towards specific suppliers. It is used to align quality

improvement efforts towards suppliers that significantly affect Customer

Satisfaction and Safety. It is a data model based on Q1 and commodity

prioritization.

66





Web Address� http://www.Purchasing.ford.com/prch_sta_man/html/segmentation.htm

Documents� PSS-001, Quality Supply Base Segmentation Standard

– Appendix A – Segmentation Change Request Flow Chart

� SIM, Supplier Improvement Metrics

� PSP-010, Q1 for External Suppliers of Production & Service Parts

� Commodity Prioritization List

Forms� Segment Change Request Form (PP-S-F001)� Segmentation Overlay Change Request Form (PP-S-F004)

Notes

The links listed in the above slide are provided for you to fully understand the Quality Segmentation Process.

Recap of the course:

• Explored the purpose of Supplier Quality Segmentation and why it is important at Ford.

• Demonstrated the proper use of the Segmentation Model.

• Identified the various STA and Purchasing personnel responsibilities in the Segmentation Process.

• Reviewed the completion of a Segmentation Change Request using the Segmentation Change Request Form.

67

STANDARD # PSS-001

QUALITY SUPPLY BASE SEGMENTATION

Supplier Technical Assistance Standard

Revision datePage 1 of 10 2005

Originator: STA SBO Date Issued: 18 Nov 2002 PSS-001 Quality Segmentation Standard Date Revised: 29 April 2005

: 29 April1. FOREWORD

1.1. Approval: Purchasing Supplier Technical Assistance (STA) owns this standard by the authority of the Global Purchasing Group Vice-President. • The Strategy and Business Office (SBO) department within STA is assigned responsibility to

maintain the standard as defined and agreed by the STA Director's Operating Committee Members (OCM). For the purposes of document control, the SBO Manager is the champion of this standard. Questions regarding the interpretation of this standard should be directed to the SBO Department Manager.

1.2. Purpose: This standard documents the methodologies encompassed by a strategy titled Quality Supply Base Segmentation. Quality Supply Base Segmentation defines the basis by which STA allocates resources towards supplier improvement.

1.3. Applicability/Scope: STA managed tier 1 external production manufacturing locations (suppliers) to VO and PTO as documented in GSDB and WIPS.

This Standard is not applicable to sub-tier (tier > 1) suppliers.

1.4. Change Control/Review Process: Revision to this quality standard shall be managed (including review and update) as described in

PSW-001 - How to Write/Publish STA Procedures, Work Instructions & Guidelines The master copy of this standard shall be accessible via the STA Master Document List on the Ford Intranet. Changes to the master copy will be highlighted with a vertical side bar. 1.5. Deviation Process:

Adherence to the quality standard is mandatory unless otherwise authorized by consensus of the STA Operating Committee Members. . • Request(s) for deviation may be scheduled as an STA OCM agenda item • Record of deviation is to be documented in GSM "STA Notes" area upon approval.

1.6. Training: Quality Segmentation overview is available from SBO on the Quality Segmentation Home Page, and training materials are available from the Ford Corporate Quality Development Center.

2. DEFINITIONS

Consensus – General agreement, characterized by the absence of substantial issues and by a process that takes into account the views of the affected activities and reconciles conflicting argument. Quality Supply Base Segmentation - Business model differentiating how STA prioritizes continuous improvement efforts within the Ford Motor Company supply base by defining a relationship between supplier quality performance and the purchased commodities' impact on customer satisfaction &



STANDARD # PSS-001



Page 2 of 10 Revision date 2005

OrigPSS

: 29 Aprilsafety. Resource allocation and quality tool application are then varied based upon each supplier's manufacturing location quality segment predicted by the Quality Segmentation model. Quality Segment - A term that classifies a supplier manufacturing site in one of four categories based on the Quality Segmentation model. A supplier manufacturing site's individual quality performance Q1 Status and the impact of the sites commodities on customer satisfaction and safety dictate the category. Commodities are designated as having High or Low Impact on Customer Satisfaction/Safety per the Commodity Prioritization List. A site is categorized as having a High Impact on Customer Satisfaction and Safety if it has at least one commodity designated as High Impact on Customer Satisfaction/Safety. The categories are depicted in Figure 1.

H H

ComImpCus

Satis/ S

LLOO

SSeeggmmeenntt 11 oorr 22:: QQ11 SSttaattuuss RReevvooccaattiioonn ((RR)) oorr

DDeenniieedd ((XX))

SSeeggmmeenntt 33 oorr 44:: QQ11 SSttaattuuss AApppprroovveedd ((YY))

oorr WWaaiivveedd && iinn GGoooodd SSttaannddiinngg ((WW))
HIIGGH
inator: STA SBO Date Issued: 18 Nov 2002 -001 Quality Segmentation Standard Date Revised: 29 April 2005

Commodity Prioritization – Defined as the y-axis in the Quality Segmentation model. The commodity priority is based on review of customer satisfaction and safety measures. The three measures are: Field Actions, Things Gone Wrong, and Warranty. Each measure's contribution is weighted to provide an overall priority for each of the Purchasing production high-commodity codes.

modity act on tomer faction afety WWEERR

Figure 1 GSDB – Global Supplier Database WIPS – World-wide Integrated Purchasing System VO – Vehicle Operations PTO – Powertrain Operations High Commodity Code – WIPS code describing overall commodity grouping, e.g. "plastic parts"

II. Significant • Low Impact on Customer

Satisfaction / Safety • Non Q1 – High Risk

IV. Autonomous • Low Impact on Customer

Satisfaction / Safety • Q1 – Low Risk

III. Experienced • High Impact on Customer

Satisfaction / Safety • Q1 – Low Risk

I. Critical • High Impact on Customer

Satisfaction / Safety • Non Q1 – High Risk

Supplier Manufacturing Capability (Q1 Status)

OOUUTTSSTTAANNDDIINNGG

2:1

5:1

20:1

50:1

STANDARD # PSS-001





: 29 AprilSupplier Performance – Defined as the x-axis in the Quality Segmentation model. Supplier performance, in the model, is based off of Q1 Status. Overlay – A label given to sites to identify a special case where a site does not fit into the normal rules of segmentation. The purpose of an overlay is to either add or remove resources based on the impact that a site has on Ford Motor Company. The three categories are Quality, Limited Involvement and Launch. e.g. High Impact Parts. Q1 Status – A code that defines whether or not a supplier manufacturing location meets the minimum quality requirements for doing business with Ford Motor Company. STA procedure PSP – 010 and the Q1 Book define the external supplier Q1 requirements. PPAP Level – A code that defines the Ford involvement in direct management of suppliers and the level of documentation required to fully-qualify and approve a production part ready for production. Q1 Assessment – A comprehensive program to assess and manage supplier capability, drive continuous performance improvement, and prevent future quality issues. The process defines, assesses, and manages quality risk at a supplier manufacturing location. The analysis consists of metrics and site assessments that determine the supplier's ability to manage quality and product delivery. Work Plan - A task list with planned reviews to resolve stated issue(s). The work plan should contain at least the following items for each task: Issue Description, Open Date, Closed Date, Percent Complete, and Assigned Responsibility SIM Manufacturing Score: an index linked to the Q1 score, which compares the SIM measures against weighted objectives for each manufacturing site. STA Operating Committee Members: Direct reports to Global Director, Supplier Technical Assistance.

3 REFERENCES Documents

3.1. PSW-001 - How to Write/Publish STA Procedures, Work Instructions & Guidelines

3.2. GIS1 - Global Information Standard 1

3.3. PSP-010 Q1 for external production suppliers

3.4. PSW-009 APQP Status Reporting Process & Selection of High Impact Suppliers

3.5. STA Roles and Responsibilities

3.6. Commodity Prioritization List

Forms 3.7. PP-S-F001 – Segmentation Change Request Form 3.8. PP-S-F004 – Segmentation Overlay Change Request Form

3.9. PP-S-F062 - Supplier Quality Segmentation Change Request Spreadsheet

http://www.edrwas.ford.com/launchomatic/launch/view.jsp?chronicleId=09000c5180130469&docbase=edrdoc1

http://www.edrwas.ford.com/ekb2/bookmark.html?objectId=0b000c518015df13

http://www.edrwas.ford.com/launchomatic/launch/view.jsp?chronicleId=09000c51801bb8dc&docbase=edrdoc1

http://www.edrwas.ford.com/launchomatic/launch/view.jsp?chronicleId=09000c518013042e&docbase=edrdoc1

http://www.purchasing.ford.com/prch_sta_man/html/newrr2.htm

http://www.edrwas.ford.com/launchomatic/launch/view.jsp?chronicleId=09000c518037f296&docbase=edrdoc1%20

http://www.edrwas.ford.com/launchomatic/launch/view.jsp?chronicleId=09000c518014d1ae&docbase=edrdoc1

http://www.edrwas.ford.com/launchomatic/launch/view.jsp?chronicleId=09000c518014d1b4&docbase=edrdoc1

http://www.edrwas.ford.com/launchomatic/launch/view.jsp?chronicleId=09000c51804dd355&docbase=edrdoc1

STANDARD # PSS-001



Revision datePage 4 of 10 2005


: 29 April Data and Data Systems 3.10. SIM - Supplier Improvement Metrics

3.11. Quality Segmentation Home Page.

4. INSTRUCTIONS/REQUIREMENTS 4.1. General:

4.1.1. Commodity prioritization (y-axis) will be analyzed, on an as needed basis, by SBO and concurred by the STA Director and the STA OCM for potential realignment between upper and lower segments. The results of this analysis will be published on the segmentation web site in the form of a commodity prioritization list.

4.1.2. STA management will conduct a strategic review of individual commodities and supplier sites, as determined by management, to ensure alignment of segments with customer satisfaction and other STA strategic objectives. The results from this review will be incorporated into the commodity prioritization list.

4.1.3. SBO will conduct validation audits, as determined by management, of all supplier segment realignments. The audits will be included in the STA segmentation QOS reports. The results of this will be published on the segmentation web site.

4.1.4. SBO will develop a quarterly summary report (Global Scorecards) of the total number of suppliers in each of the segments and their compliance to the model. The results of this will be published on the segmentation web site.

4.1.5. The x-axis of the Segmentation Model defines manufacturing capability using the Q1 status codes. Suppliers with a Q1 status code of "Y"(Q1 Achieved) are to be segmented in segment 3 or 4 consistent with the safety/customer satisfaction impact of their commodity. For Bulk Materials suppliers, the "N" status is represented by the "Y" code in the segmentation model and all segmentation forms.

4.1.6. The assigned STA Site Engineer will review supplier quality performance (Q1 Status) for potential realignment between left and right segments. Segment change requests are submitted by following the instructions on form PP-S-F001 – Segmentation Change Request Form, an equivalent spread sheet is also acceptable providing it contains all necessary fields per region on PP-S-001.

4.1.7. All 'Critical (Segment 1)' or 'Significant (Segment 2)' supplier sites will have a PPAP level from 2 to 5.

4.1.8. Supplier manufacturing sites, which are not segmented or are new to the supply base, will be Critical – Segment 1 or Significant – Segment 2. All un-segmented sites are required to be segmented by the STA Site Engineer within six months of activation in GSDB. SBO will notify the site managers of sites not segmented in this time frame. The Site Manager will notify the STA Site Engineer of approval or rejection.

4.1.9. A new manufacturing site that has no Q1 scoring or performance history, but has achieved Q1 Status of "A", can move from left to right. Once the new site has established a performance history, (Q1 scoring) the site would be segmented based on its actual performance. (Reference Appendix A, Flow Chart "Segmentation Change Request".

4.1.10. SBO will maintain the master quality segmentation database and will process all approved segment transactions received on form PP-S-F001 – Segmentation Change Request Form or equivalent. The form or equivalent must be forwarded to The STA SBO Segmentation contact, (CDS ID SEGINFO). Note: Where form PP-S-F062 Supplier Quality Segmentation Change Request Spreadsheet (or similar) is used as an equivalent form to PP-S-F001, the number of





STANDARD # PSS-001


Revision date


Page 5 of 10 2005


: 29 Aprilrequested segmentation changes should be limited to 50 per submittal, and change requests should not be duplicated in separate submittals.

4.1.11. SBO will make available, via the Ford Intranet, the Commodity Prioritization List on the Quality Segmentation Home Page.

4.1.12. Supplier movement left to right (improved performance) or right to left (non Q1-"R" Revoked or Denied "X") may be nominated by the STA Site Engineer via form PP-S-F001 – Segmentation Change Request Form or equivalent (see 4.1.10 note above) and requires approval by the STA Site Manager and the New STA Site Manager (when applicable) receiving the site. For Bulk Materials suppliers, the "U" status is represented by the "X" and "R" codes in the segmentation model and all segmentation forms.

4.1.13. Reference Appendix A, Flow Chart "Segmentation Change Request". 4.1.14. Quality segmentation model deviation process (Overlay) allows suppliers to be

segmented outside of the normal rules of segmentation depending on the regional STA leader's discretion. The STA Strategy and Business Office (SBO) will manage this on-going list of segmentation model deviations. Addition and removal of Overlays are to be made via Form PP-S-F004 or equivalent as described in Appendix B, Flow Chart.

4.1.14.1. "Quality" Overlay is a label given to a supplier with a Q1 status of "Y" that would be allowed to be segmented in segment 1 or 2 based on the STA manager's discretion to apply more resources to correct issues at the supplier.

4.1.14.2. "Launch" Overlay is a label given to a Q1 approved supplier (Segment 3 or 4) that requires additional STA resources due to the support of a new model launch -(e.g. High Impact Part per PSW-009 APQP Status Reporting Process & Selection of High Impact Suppliers) or to mitigate risk at a site due to increased business through re-sourcing actions

4.1.14.3. "Limited Involvement" Overlay is a label given to a non-Q1 supplier (Segment 1 or 2) that requires a reduction in STA resources. This category should be used when one of the following applies: • An organization outside STA has accepted responsibility and applied resources to manage non quality improvement actions. (e.g. Delivery or Environmental.

• The site is classified short-term eliminate (STE) or equivalent and has an acceptable site assessment action plan that creates limited risk to Ford Motor Company.

• Has acceptable quality performance Q1 will be awarded upon receipt of certification (QS9000,ISO/TS16949,ISO14001,MMOG/MS9000/ODETTE).

4.2. Specific Requirements:

4.2.1. Segmentation Process

STA SBO will: 4.2.1.1. Gather customer satisfaction and safety data inputs: Field Actions, TGW, and

Warranty Data (Q1 metrics) and prioritize by commodity codes. Reference Commodity Prioritization List, see 0 .

4.2.1.2. Order commodity prioritization data on Segmentation Chart in descending priority on y-axis

4.2.1.3. Locate supplier in a segment by aligning supplier's commodity and locate quality performance based on Q1 Status on x-axis of the Segmentation Chart.

4.2.1.4. Publish monthly and Quarterly Quality Segmentation QOS reports: Monthly: • Quality Segmentation QOS Metric – Quality Tracking of Segment 1

Suppliers utilizing Performance Metrics. (NA Only)


STANDARD # PSS-001





: 29 April• Segmentation Overlays – Matrices of the respective months Quality,

Launch & Limited Involvement Overlay's. (NA Only) Quarterly: • V.O. • Mexico • China

4.2.2. Resource Allocation STA Site Engineering Management shall:

4.2.2.1. Allocate segmented suppliers to Site Engineers per Table 2 below. Exact ratios of suppliers to engineers will be dependent upon commodity criticality and regional resources. Site Engineers may work across segments in the same commodity, sharing their time, to achieve the desired supplier to engineer ratios listed in Table 2.

Table 2 Resource allocations of suppliers per engineer

Segment I – Critical

2 Suppliers to 1 Engineer

Segment 3 – Experienced


Segment 2 - Significant


Segment 4 – Autonomous


4.2.3. Process for segment change Submit the request per Segmentation Change Request form PP-S-F001 or equivalent (see 4.1.10 note above). The following provide some guidance in the completion of form PP-S-F001

4.2.3.1. The STA site engineer, supervisor or manager responsible for the manufacturing site should initiate a "Segment Change Request Form" an equivalent spread sheet is also acceptable providing it contains all necessary fields per region on PP-S-F001 . The STA site engineer, supervisor or manager responsible for the manufacturing site. Note: Where form PP-S-F062 Supplier Quality Segmentation Change Request Spreadsheet (or similar) is used as an equivalent form to PP-S-F001, the number of requested segmentation changes should be limited to 50 per submittal, and change requests should not be duplicated in separate submittals.

4.2.3.2. The Manufacturing site code is the GSDB code. 4.2.3.3. The rationale for segment change should consider the Q1 Status for the supplier

site and the Commodity Impact on Customer Satisfaction/Safety as well as the business or strategic issues (Overlays as appropriate). Reference Commodity Prioritization List.

4.2.3.4. The current STA supervisor responsible for the supplier site and the new STA supervisor receiving the site must approve the form or equivalent (see 4.2.3.1 note above) before it is submitted to SBO.

4.2.3.5. Once submitted to SBO, the rationale will be reviewed within 5 business days. The segment change request may be denied (with explanation) or SBO may request additional information before approval.

4.2.3.6. The approved change will be entered into the segmentation database and an e-mail notice will be sent to the current Site Engineer. The current Site Engineer should notify the affected supplier site(s), buyer(s), STA Engineer(s) and Manager(s) affected by the segment change.


STANDARD # PSS-001





: 29 April4.2.3.7. The approved submission will be retained by SBO as per Standard 1 (GIS1)

Record Schedule. (See section 6 Quality Record).

4.2.4. Roles and Responsibilities 4.2.4.1. STA Roles and Responsibilities are detailed in the Roles and Responsibilities,

Reference 3.5. 5. Quality Records

The following records are maintained by STA SBO in accordance with the Global Information Standard 1 (GIS1) Retention Schedules: 04.01 Segmentation Change Request Superseded + 3 years 04.01 Segmentation Overlay Change Request Superseded + 3 years 04.01 Deviations by OCM Superseded + 3 years


Date Approved by:

11/18/2002 STA OCM (Initial Release) 29 April 2005 STA procedure OCM

Simplified with flow charts, added bulk materials, limited mass update submissions.

STANDARD # PSS-001





: 29 April

EXECUTIVE SUMMARY

Quality segmentation was developed to focus supplier improvement on measures most important to the consumer: customer satisfaction, safety and quality. In the past we have treated all external manufacturing locations with the same customary improvement techniques and quality methods, regardless of each supplier's relative impact on the consumer. The focus has been on sites with an "immediate need" based on various measures and priorities. The priorities were typically personalized for the individual STA regional organization and departmental need. The advent of Supplier Improvement Metrics (SIM) brought common measures to gauge supplier performance. However, analysis of the SIM system data requires much time and effort to prioritize which sites require attention. Additionally, the supplier performance data have no direct link to customer satisfaction and safety. The quality segmentation model globally aligns and prioritizes STA's quality improvement efforts. Quality Segmentation focuses STA efforts on manufacturing sites that have an impact on customer satisfaction & safety and which also demonstrate poor quality performance. The model analyzes customer satisfaction & safety data and provides a standardized algorithm to score manufacturing site performance. This promotes better focus and allocation of STA resources for optimal improvement within our supply base. The differentiation the model provides also predicts the number of STA Engineers and their skill sets required to bring about improvement and how we work with the various categorized suppliers.

STANDARD # PSS-001


Supplier Technical Assistance Standard Appendix A, Segmentation Change Request Flow

STASite Engineer

STA Site Manager

SBO-Segmentation

Leader

STAGSDB

2AHas the Q1

Status Changed

to "Y" or "W"?

2B Has the Q1


2C Q1 Status


Discretion



move to Seg. II

No

4BComplete the




6B Receive







5AComplete the




7BUpdate Org Code & STA Engineer in

GSDB (SIM Updated)


Changing?

8Retain Copy for 3


MatrixYes


No

Yes

No


Signatures



No

Yes




Yes Yes






Page 9 of 10 Revision date 29 April 2005


:

STANDARD # PSS-001


Supplier Technical Assistance Standard Appendix B, Segmentation Overlay Change Request Flow

Page 10 of 10 Revision date 29 April 2005


:

STASite Engineer

STA Site Manager

Regional STA Leader

SBO-Segmentation

Leader

STAGSDB

3CTreat as a Seg. III but stays

Segmented as a ITreat as a Seg. IV but stays

Segmented as a II

4AAdd the Current

STA Organization Code & Obtain the


6B Receive Form & Update Segmentation of the site.

To activate the Link to the Quality Segmentation Home page:Right click the Legend Box & scroll down to the Segmentation Home Page

& select.(http://www.purchasing.ford.com/prch_sta_man/html/segmentation.htm)

5AAdd the Current & New STA Org. Codes & the New STA Eng's. Name & CDSID. Obtain the Current & New Site


7BUpdate Org Code & STA Engineer

in GSDB (SIM Updated)

7AIs the STA Org

Code Changing?

8Retain copy for 3 years per the STA Quality Records

Matrix

Yes

2AIs this a Quality

Overlay ("Y") Change?

3BN.A.:

Remains a Seg. III site & assigned to a Seg. I Eng.

Remains a Seg. IV site & assigned to a Seg. II Eng.

The Launch Overlay does not apply to Europe, the site remains in the Segment.

3AIf High Impact on Cust. Sat./Safety move

temporarily to Seg. I If Low Impact on Cust. Sat./Safety move

temporarily to Seg. II

2BIs this a Launch

Overlay ("Y") Change?

2DRemove Overlay

2CIs this a Limited Involvement ("R" or "X") Change?

5CReview, Sign & Date the Segmentation Overlay Change Request Form

No

No

Yes

No

Legend: Definition: There's a business case to change our support of the supplier temporarily, when there's no commodity or Q1 Status Code dictating the change.Q1 Codes Recognized for Segmentation Overlay Process: A,Y,R,X,& W; others are not.Q1 Status - A code that defines whether or not a supplier manufacturing location meetsthe minimum quality requirements for doing business with Ford Motor Company. See PSP-010 & Q1 Book.1A & B. A Segmentation Overlay is required when business conditions dictate. This is concurred by the STA Engineer & STA Manager, typically in a monthly supplier site and business status review. 1B. A site with a Q1 Status code of "D" (Disposition required, risk not assessed) requires a site assessment and assignment of the appropriate Q1 status code (other than "D") before it can be segmented or have an overlay applied. Once assessed for risk and with a Q1 status code other then "D", the site becomes an existing site, go back to 1A. See PSP-010 for an explanation of the Q1 status codes. Q1 Site Assessment Required (D) is the default code upon site activation. 2A. "Y" Q1 Achieved. After six months, the supplier site must either have their Q1 status change to "R" (Revocation), or they must be re-segmented to segment 3 or 4. See Std. PSS-001 4.1.13.12B. See Std. PSS-001 4.1.13.22C. See Std. PSS-001 4.1.13.33B. North America Note: High Impact on Cust. Sat./Safety in Seg. IlI - Low Impact on Cust. Sat./Safety in Seg. IV3C. North America Note: High Impact on Cust. Sat./Safety in Seg. l - Low Impact on Cust. Sat./Safety in Seg. II 4A,4B/5A,5B,5C. A meeting between the two responsible areas of the described organizational code. Not applicable to Europe.

4B Obtain the Current


5BObtain the Current

& New Site Manager's Signatures

1A & BNew Site:

Q1 Site Assessment Required Existing Site:

Overlay required when business conditions dictate. As determined by STA Engineer & STA Manager

(Monthly Reviews Recommended)

Remove Limited Involvement Overlay

Remove Quality & Launch Overlay

Launch Overlay


Quality Overlay

No

Yes

Yes

1AIs this an Existing Site?

(Monthly Reviews Recommended)

Yes

6AFax the Completed

Form to SBO Segmentation

1BIs this a New Site /Initial



Procedure PSP-010

Q1 FOR EXTERNAL SUPPLIERS OF PRODUCTION & SERVICE PARTS Supplier Technical Assistance Procedure,

Page 1 of 24 Revision date: 30 July 2004

Q1 2nd Edition Requirements PSP-010 Summary and Q1 Process Sequence

Q1 Process Steps Listed by Procedure Section and Chronological Sequence Procedure section 7 Section title: New Site Q1 eligibility and Site code assignment Summary: Buyer, STA Engineer, Q1 Coordinator, and MP&L responsibilities are defined for the

assignment of the appropriate Q1 code to a new supplier manufacturing location. Q1 code flow: New Site Q1 Site Assessment Required ("D") Awaiting Q1 Approval ("A"),

or Q1 Requirements Waived ("W") or Approval Denied ("X") or Tier 2 ("2"), Note: Q1 codes are defined in Appendix A of this procedure. Procedure section 7.15 Section title: The Site fails to achieve Q1 when assigned Q1 code “A” - Awaiting Q1 Approval Summary: STA Engineer responsibilities are defined for the case when supplier performance makes

the Site ineligible for Q1. Q1 code flow: Awaiting Q1 Approval ("A") Approval Denied ("X"). Procedure section 7.16 Section title: Requirements for achieving Q1 Summary: STA, MP&L, Ford Motor Company Receiving Plants, Allies1 tracked in SIM, and FCSD

responsibilities are defined in assessing supplier Site capability to achieve Q1. Q1 requirements include:

• Endorsements • 3rd party and MP&L certifications • Acceptable Q1 Manufacturing Site Assessment • On going performance metrics over the 6 month period prior to Q1 application

Q1 code flow: Awaiting Q1 Approval ("A")

Procedure section 7.20 Section title: Q1 Application Summary: STA engineer, Buyer and Q1 Coordinator roles are defined in the review of the Q1

application. Q1 code flow: Awaiting Q1 Approval ("A") Q1 Achieved ("Y") or Approval Denied ("X").

Supplier Technical Assistance (STA) Printed copies are uncontrolled

1 Allied facilities are Joint Ventures and other commercial arrangements which have full Q1 metric tracking in SIM.

Procedure PSP-010



Procedure section 7.24 Section title: Q1 Revocation Summary: STA engineer, Buyer, FCSD engineer, MP&L, and Q1 Coordinator responsibilities are

defined when revoking a supplier Site. Q1 code flow: Q1 Achieved ("Y") Q1 Revoked ("R"). Procedure section 7.34 Section title: Loss of Q1 through Site inactivity Summary: Q1 Coordinator, FCSDDATA and FCSD / Production STA Engineer responsibilities are

defined for Sites with no shipping history for 13 consecutive months. Q1 code flow: Q1 Achieved ("Y") Site deactivated and Q1 status deleted. Procedure section 7.37 Section title: Loss of "Q1 Requirements Waived" Status Summary: STA engineer and Q1 Coordinator responsibilities are defined where a "Q1 Requirements

Waived" ("W" status) Site is not renewed annually or Ongoing Performance does not meet Q1 requirements.

Q1 code flow: Q1 Requirements Waived ("W") Q1 Approval Denied ("X"). Procedure section 7.42 Section title: Q1 Reinstatement Summary: STA engineer, Q1 Coordinator and MP&L responsibilities are defined in the

reinstatement of a Site's Q1. Q1 code flow: Q1 Revoked ("R") Q1 Achieved ("Y"). Procedure sections General Rules 8.1and 8.2 Q1 Status Code Updates Summary: Global Q1 status change authority for production only and service/production common

Sites is limited to the Q1 Coordinator. Service unique Site authority is "FCSDDATA". Procedure section General Rules 8.4 Recommended Q1 Status Code Postponement Process Summary: When SIM data recommend a Site Q1 status change, the STA engineer may postpone the

code change. The Engineer has 3 months to implement the code change or correct the data. A report is issued monthly, indicating ageing of recommended Q1 status changes.

Procedure section General Rules 8.5 Moving Q1 Summary: Q1 represents a Site’s capability, and therefore is not transferable to another location

(address). Procedure section General Rules 8.6 Supplier Site Acquisition Summary: QS-9000 requirements indicate that the supplier notifies Ford of any acquisition of the

Site or other significant quality system change. Procedure section General Rules 8.7 GSDB Currency Site Codes Summary: Special requirements governing the use of multiple currency GSDB codes at a single Site

are described.


Procedure PSP-010



References Definitions Q1 Eligibility Site qualification

Q1 Revocation Appendix A Q1 reinstatement Site inactivity Earning Q1

Ongoing metrics

1. PURPOSE

This procedure defines the Q1 2nd Edition process for external manufacturing suppliers of production and service parts (including materials).

2. ACTIVITIES AFFECTED Global STA Global Purchasing MP&L of North America and Ford of Europe FCSD of United States and Ford of Europe

3. FORMS / TEMPLATES USED 3.1 Manufacturing Site Assessment 3.2 Buyer Addition/Change Form 3.3 PP-S-F047 Endorsement pro-forma 3.4 Q1 Letter 3.5 Q1 Revocation Letter 3.6 PP-S-F008 Field Service Action Change Request 3.7 PP-S-F009 Stop Ship Change Request 3.8 PP-S-F005 Non Q1 Sourcing Approval for Q1 status code "A" 3.9 PC-P-F012 Non-Q1 Sourcing Approval Request for Q1 status codes “X” and

“R”

4. REFERENCES Standards and other STA procedural requirements

4.1 FAP03-002 – Purchasing Production and Non-Production Goods and Services 4.2 GSDB On-Line 4.3 GSM (Global Site Management Database) 4.4 ISO 14001 4.5 Manufacturing Site Assessment expectations (Q1 2nd Edition book pp 37 to 55) 4.6 Recommended Status summaries (Q1 report) 4.7 PPS-001 Quality Segmentation Standard 4.8 Q1/SIM/Global Site Management Training Guide 4.9 Q1 2nd Edition Manual 4.10 (QS-9000) Quality System Requirements 4.11 SIM (Supplier Improvement Metrics search screen) 4.12 STA Organizational Contact List 4.13 TS16949:2002 Quality management systems – Particular requirements for the

application of ISO 9001:2000 for automotive production and relevant service part organizations


http://web.qpr.ford.com/sta/Q1_Site_Assessment_Evaluation_Matrix.xls

http://www.purchasing.ford.com/prch_prod_proc_man/doc/pcpf044.doc

http://www.purchasing.ford.com/prch_sta_man/doc/522q1proforma.doc

http://www.eim1.ford.com/launchomatic/launch/view.jsp?chronicleId=09000c51801304a2&docbase=edrdoc1

http://www.eim1.ford.com/launchomatic/launch/view.jsp?chronicleId=09000c51801304bb&docbase=edrdoc1

http://www.edrwas.ford.com/launchomatic/launch/view.jsp?chronicleId=09000c5180380310&docbase=edrdoc1

http://www.eim1.ford.com/launchomatic/launch/view.jsp?chronicleId=09000c5180130515&docbase=edrdoc1

http://www.eim1.ford.com/launchomatic/launch/view.jsp?chronicleId=09000c51801305cf&docbase=edrdoc1

http://www.purchasing.ford.com/prch_prod_proc_man/doc/pppf012.doc

http://www.edrwas.ford.com/launchomatic/launch/view.jsp?chronicleId=09000c51802afe47&docbase=edrdoc1

https://q1.ford.com/mdso/redirect.cgi?back=https://web.gsdb2.ford.com/GSDBeans/servlet/GSDB

http://www.purchasing.ford.com/prch_nonq1/

https://web.qpr.ford.com/sta/ELU_Drtv.pdf

https://web.qpr.ford.com/sta/Q1_2nd_Edition_Manual.pdf

http://www.purchasing.ford.com/prch_sta_man/doc/NonQ1Report.pdf

http://www.edrwas.ford.com/launchomatic/launch/view.jsp?chronicleId=09000c518015146d&docbase=edrdoc1

https://web.qpr.ford.com/sta/Q1_Training.pdf


http://www.edrwas.ford.com/launchomatic/launch/view.jsp?chronicleId=09000c51801bf6a5&docbase=edrdoc1


http://www.purchasing.ford.com/prch_sta_man/doc/POC.PDF

http://www.edrwas.ford.com/launchomatic/launch/view.jsp?chronicleId=09000c51801bf6c0&docbase=edrdoc1



Procedure PSP-010




Q1 reinstatement Appendix A Site inactivity Q1 Revocation Earning Q1

Ongoing metrics

4.14 Sourcing for Quality STA Roles and Responsibilities: Pre Source and Competitive Quote

Sourcing and other requirements external to STA

4.15 GIS1 4.16 MMOG 4.17 P-P2.1.5 Sourcing to a Non-Q1 Facility 4.18 QS-9000 Sanctioned Interpretations 4.19 ISO/TS 16949 interpretations and registration information (IAOB)

5. DEFINITIONS DMA: Database Management Administrator, Purchasing. Updates GSDB per requests. Engineer: Production STA Site Engineer, unless the Site is service unique, then Engineer is service STA Engineer. FMC: Ford Motor Company FSP: Ford Supplier Portal Interactive communication medium where FMC and suppliers exchange key data and information via the public Internet. Greenfield Site: A supplier site which has no automotive manufacturing capability – the site may not yet exist or is newly acquired from a non automotive industry. GSDB: Global Supplier Database. Internal FMC system which contains production and non-production supplier profiles. GSDB On-Line: FSP application enabling suppliers to update Q1 capability certifications. GSDB On-Line feeds to FMC internal GSDB. GSM: (Global Site Management database) FMC internal database used to maintain supplier manufacturing Site data (e.g.: Site Assessment results, endorsements) MP&L: Material Planning & Logistics. FMC organization. New Site: A supplier manufacturing Site that is new to Production Purchasing in Ford Motor Company and its brands – without Q1 status, shipping history or production GSDB code (note: a Site currently supplying non production material, e.g. machine tools, offering to manufacture production parts for the first time would also be a "new Site"). PE: Production Established: Indicator which starts the Q1 status code "A"- 'Awaiting Q1 Approval' clock. POC: (Point of Contact). Individual within each STA organization responsible for updating GSDB data. PPM: Parts per Million. Normalized reject calculation. Q1 Coordinator: For production only and shared Sites, the Global STA position in North America SBO authorized to update Q1 codes in GSDB for all global regions and Ford brands. For service unique Sites, the role is "FCSDDATA".


http://www.edrwas.ford.com/launchomatic/launch/view.jsp?chronicleId=09000c5180340c3c&docbase=edrdoc1

http://www.edrwas.ford.com/launchomatic/launch/view.jsp?chronicleId=09000c5180340b81&docbase=edrdoc1

http://www.dearborn4.ford.com/gim/gis/index.htm

http://www.eim1.ford.com/launchomatic/launch/view.jsp?chronicleId=09000c518013051a&docbase=edrdoc1


http://qs9000.asq.org/sancl.html

http://www.iaob.org/

Procedure PSP-010




Appendix A Q1 reinstatement Site inactivity Q1 Revocation Earning Q1

Ongoing metrics

Recommended Status: Recommended Q1 code, determined by the Site's Q1 score and PE date Site: Manufacturing supplier site Site Assessment: Manufacturing Site Assessment per Q1 expectations SBO: Strategy and Business Office. STA organization. STA: Supplier Technical Assistance. FMC Purchasing organization. STA Active/Inactive screen in GSM: A GSM tool to activate or deactivate a supplier site for either production or service. To access the screen, from the STA Engineer's worklist in GSM (production or service), click "Go to" for the site, and then "Update" for either Service or Production Active. Tier 1 Site: A supplier manufacturing site sourced by Ford Motor Company, and fully responsible for the parts it manufactures and ships directly to Ford Motor Company. Tier 2 Site: Manufacturing supplier Site shipping all product to Tier 1 supplier(s) (not shipping directly to any Ford facility). The site may be identified by a GSDB code and STA monitored (STA active). Tier 2 (Direct Ship) Site: The tier 1 with the Purchase Order is held responsible for all direct ship tier 2 performance. The eVEREST System Integrator / Commodity Rollup Complex Sourcing solution for direct ship tier 2 sites eliminates the need for "virtual sites" to accommodate direct ship tier 2 performance tracking. For sourcing not using the eVEREST Complex Sourcing solution:

o The parts manufactured by the direct ship tier 2 site are sourced to an appropriate manufacturing site of the tier 1 with the Purchase Order.

o The "virtual" site is listed as a ship point for the tier 1 manufacturing site with the Purchase Order.

o All performance data for the direct ship tier 2 parts is passed to the tier 1 manufacturing site with the Purchase Order.

6. EXCLUSIONS

6.1 Non-manufacturing facilities such as: warehouses, In Line Vehicle Sequencing Centers, PO boxes, accounting offices, sales offices, prototype design facilities, repair facilities, rework shops, ship points, and other non-manufacturing locations are not eligible for STA support or Q1.

6.2 Manufacturing locations which cannot generate all Q1 metrics, including quality and delivery performance, are not eligible for Q1.

6.3 Non production Q1 is not included in the scope of this procedure and is managed by FM&SP (Facilities, Materials and Services Purchasing).


Procedure PSP-010





Ongoing metrics

6.4 Only Sites designated "STA Active" may have a Q1 status code. Examples of Sites not STA active, and therefore without a Q1 status code, include currency codes, see 8.7 of this procedure. Note: “STA Active” indicates that a production and /or service STA engineer has been assigned to the supplier manufacturing site.

6.5 Bulk materials include, but are not limited to: petrochemicals, adhesives and sealants, coatings, engine coolants, ferrous and non ferrous metals, foundry materials, lubricants, polymers and performance fluids. Bulk material brokers are not manufacturing sites, however, for certain commodities the brokers are issued the Purchase Order. Note: Purchasing requirements state that the Purchase Order is only issued to supplier manufacturing sites. Q1 2nd Edition metrics may not apply to all bulk material brokers. Compliance to Ford specifications (engineering, material, performance) for bulk material must be assured by the broker and is managed by Purchasing per the Purchasing Order Terms and Conditions.

6.6 Ford internal plants are not included in the scope of this procedure. These plants manage their quality systems locally.

7. PROCEDURE

New Site Q1 eligibility, STA activation and Site code assignment Site Code Assignment and STA Site Activation 7.1 A Buyer establishes a new Site in GSDB by submitting the Buyer

Addition/Change Form (see 3.1). The Site must be set up as a manufacturing location in GSDB to be eligible for sourcing and Q1.

7.2 The DMA provides the Buyer with a unique 5 digit GSDB Site code. 7.3 The Buyer determines which STA Commodity Manager is to be notified of the new

Site and may use the STA Organizational Contact List (see 4.12) to get the name. 7.4 The Buyer forwards the Buyer Addition/Change Form, (see 3.1) including the

Site contact information to the STA Commodity Manager. 7.5 The STA Commodity Manager assigns the Site to an Engineer. 7.6 The Engineer activates the Site via the Site Active/Inactive screen in GSM (see 4.3

and Definitions), and notifies MP&L of the new Site code. The Engineer ensures that GSDB is updated with the following Site information:

• PPAP level • Quality Segment • Plant and Quality Control Managers (name, phone, fax and e-mail)

7.7 Manufacturing Site Assessment and Q1 status code changes


Existing supplier manufacturing Site.

Procedure PSP-010





Ongoing metrics

7.7.1 The STA site engineer conducts an on-site Manufacturing Site Assessment per the Q1 requirements.

Greenfield sites 7.7.2 Greenfield sites will be initially assessed using surrogate data. The Engineer

conducts an on-site Manufacturing Site Assessment, including approval of the completion of any supplier corrective actions, prior to PSW. Sourcing approval for Greenfield sites is documented on PP-S-F005. Sourcing approval for Greenfield sites using surrogate data requires the approval of the STA site manager (noted on PP-S-F005). Note: for Greenfield or existing sites, the Engineer conducts the initial Site Assessment to determine Q1 feasibility within 6 months of Site activation. Note: If a Manufacturing Site Assessment was conducted in support of a Sourcing for Quality Assesssment (per 4.14), that Manufacturing Site Assessment may be used to determine site capability to achieve Q1. To be acceptable, that Sourcing for Quality Manufacturing Site Assesssment can be no more than 90 days old at the time of site activation.

Status code updates. 7.7.3 Where the Site Assessment is successful per 7.7.1 or 7.7.2 above, the

Engineer submits Q1 status change form PP-S-F005 to the Q1 Coordinator/FCSDDATA indicating sourcing approval and assignment of Q1 status A "Awaiting Q1 Approval".

7.7.4 Where the Site Assessment was not completed per section 7.7.1 or 7.7.2 above, the Q1 Coordinator/FCSDDATA assigns an initial default Q1 status code of "D" – Q1 Site Assessment Required (See Appendix A). Note: no sourcing to a Site is permitted prior to the completion of a Site Assessment per 7.7.1 or 7.7.2.

7.7.5 For tier 2 Sites, the Engineer updates the code to "2” per Appendix A. Note: tier 2 Sites have no metrics tracked in SIM. All performance tracking must be part of the tier 1 QOS.

7.8 Tier 2 Sites 7.8.1 The STA site engineer is not required to conduct a Manufacturing Site

Assessment at tier 2 Sites, (sites not shipping to a Ford facility). The Tier 1 is responsible for conducting site assessments at the tier 2 sites. Exceptions to this require STA regional Director approval. Sections 7.9 through 7.44.1 of this procedure do not apply to tier 2 Sites. The tier 2 Site is assigned Q1 code "2" per Appendix A.

7.8.2 If a tier 2 Site shows any Ford facility receipts in SIM, the Site will be assigned Q1 status "D" by the Q1 Coordinator.


http://web.bli.ford.com/

Procedure PSP-010





Ongoing metrics

7.9 This initial Manufacturing Site Assessment will result in one of the three following Q1 status codes being assigned to the Site:

• A- Awaiting Q1 Approval: Indicates that the Engineer projects that the Site will achieve Q1 within 12 months of the PE date (Production Established, see 7.14). Sourcing is permitted.

• W- Q1 Requirements Waived: This status is to be used on a limited exception basis when a supplier site demonstrates that it has product quality acceptable per the Q1 Ongoing performance metrics (see the table in 7.19.9), but for other reasons (e.g. commercial reasons), the site does not qualify for Q1. An example of this might be lack of third party certification to QS-9000 or ISO/TS 16949, but is compliant to an equivalent quality management system. A waived site is required to follow all appropriate automotive quality disciplines, including, at least APQP (or equivalent) and PPAP requirements (or equivalent). Assignment of Q1 Requirements Waived status and sourcing to the Site require Executive level Purchasing approval, see Purchasing Procedure 2.1.5 In all cases, before requesting a Q1 Waiver, all Q1 options must be considered, including Site MP&L or FCSD waivers (see section 7.17.5).

• X- Q1 Approval Denied: Indicates that the Site is not expected to meet Q1 requirements without significant improvement. Sourcing requires Executive level Purchasing approval.

7.10 The Engineer updates the Q1 code per Appendix A and sends a copy of the code update request to MP&L.

7.11 The Engineer enters the appropriate Q1 attainment plan and completes the site Action Plan sections within GSM (see 4.3).

7.12 Sourcing to sites with status codes “A” is approved through form PP-S-F005. 7.13 Sourcing requirements for Sites with R, X and W codes is managed per Purchasing

Procedure 2.1.5.

Q1 Site Qualification (Production Established) 7.14 A Site may achieve Q1 status in as few as 6 months, but in no more than 12 months

from the PE (Production Established) date. The default PE date typically reflects 5,000 cumulative production receipts.

7.14.1 Service unique PE reflects 5,000 cumulative service receipts. 7.14.2 The Engineer may modify the PE date via GSM for either:

• An actual Job 1 date/service initial shipment date (service unique), or • Cumulative production/service (for service unique) receipts

appropriate to the Site.


The Site fails to achieve Q1 when assigned Q1 code "A" – Awaiting Q1 Approval

Procedure PSP-010





Ongoing metrics

7.15 SIM recommends Q1 status of X – Q1 Approval Denied when: 7.15.1 the Site does not achieve Q1 within 12 months of PE (Production Established)

or 7.15.2 The Q1 score falls below 800 points at Q1 application, or any of the following

situations occur during the 6 months prior to application for Q1:

Field Service Action with any supplier responsibility* 2 or more stop shipments with supplier responsibility** PPM For both Production and Service (Service shipments to US and Ford of Europe Receiving locations only) Monthly commodity PPM exceeds any relevant industry commodity PPM in any of the five forward month after the six month commodity PPM exceeds the industry commodity PPM by 100% or more, with the site PPM greater than 110, leading to a PPM commodity comparison of –250 points in SIM. Delivery For both Production and Service (Service shipments to US and Ford of Europe Receiving locations only): The supplier site immature month, most recent 2 mature months and 6 month weighted average delivery ratings all fall below 81 points, leading to a delivery rating score of –250 points in SIM Manufacturing Site Assessment is delinquent, or the corrective action plan is delinquent or ineffective in execution.*** Loss of certification to ISO 14001, QS-9000 or ISO/TS 16949. Violation of Trust**** * Supplier identification and timely resolution must be reviewed and approved at the Regional STA Director level on form PP-S-F008 (Field Service Action Change Request) before any Q1 impact can be waived. ** Supplier identification and timely resolution must be reviewed and approved at the Regional STA Director level on form PP-S-F009 (Stop Shipment Change Request) before any Q1 impact can be waived. The suspect components must not have been used in Ford production for a waiver to be considered.

*** If the STA site engineer chooses to use the two step process, the second STA notification to the supplier of any of the following conditions within a 6 month period will result in a recommended revocation of Q1: **** Violation of Trust criteria include: supplier fails to get approval from Ford for:

• Manufacturing process change (including tooling), or location change • Component or material change or substitution • Subcontractor or vendor change


Procedure PSP-010





Ongoing metrics

Other criteria may include: • Launch ramp-up or rate of climb which aversely affects the Ford plant build

schedule • Self certified PSW is incomplete or inaccurate • PSW supporting data lacks integrity • Other trust issues impacting the ongoing business relationship with Ford.

Note: The assignment of "X" Approval Denied Q1 status to a site for any of the above reasons requires approval of the direct report to the STA regional Director.

7.15.3 If the Engineer disagrees with the Recommended X status the Engineer "postpones" the change per section 8.4 of this procedure.

Requirements for achieving Q1 7.16 A Site may achieve Q1 status in as few as 6 months, but in no more than 12 months from

the PE date by submitting evidence of meeting the following criteria in a single package to the Engineer. Supplier Sites eligible to apply for Q1 are manufacturing sites that have all Q1 metrics (quality and delivery performance) tracked in SIM. Supplier quality and delivery performance is displayed in SIM only for Sites directly contracted by Ford and shipping to Ford Motor Company Receiving Plants and Allies2. Note: if the Site does not achieve Q1 within 12 months of PE date, SIM will recommend the Site for X – Q1 Approval Denied Q1 status, see section 7.15.

7.17 Endorsements Endorsements are only required to obtain or reinstate Q1 status, not in the maintenance of Q1 status. Endorsements consider the most recent 6 months of those Q1 requirements relevant to the endorsing organization. Ford Motor Company plant endorsements are to be based on documented performance evidence (stop ships, PPM, 6 month weighted average delivery, corrective action plans to address the specific issues at the plant and 6 month QR trend performance for the site). If the plant endorsement is not available, the responsible STA direct report to the STA regional Director may disposition the Q1 status.

7.17.1 Endorsements are obtained using the Endorsement pro-forma (see 3.3) 7.17.2 The Engineer enters all (except MP&L) endorsements in GSM. 7.17.3 MP&L enters the MP&L endorsement in GSM.

7.17.3.1 If MP&L endorsement is not required, MP&L selects "waived" Site type. This type of supplier is exempt from the delivery portion of Q1 scoring, MP&L endorsement and MMOG/MS-9000 Odette assessments (see note below)


2 Allies are Joint Ventures or other commercial arrangements where full Q1 metrics are tracked in SIM.

Procedure PSP-010





Ongoing metrics

7.17.4 When the Engineer reviews the Q1 application (see 7.20) endorsements are not acceptable if more than 6 months old.

7.17.5 Table 1 below shows the required endorsements and approval levels. Endorsing Organization Approval Level

STA Engineer with input from STA Program management, (STA Program should obtain Product Development agreement prior to providing endorsement input)

Each Ford Customer Plant Plant Manager or designee FCSD (for Service Parts)* FCSD Quality Manager or designee Material Planning & Logistics (MP&L) **

Delivery Performance Supervisor or designee

Table 1 Site Q1 Endorsements * FCSD endorsements are limited to United States sand Ford of Europe. Service endorsement choices are as follows: • FCSD has the full 6 months of service data (Q1 metrics) and either endorses or refuses

to endorse the supplier. Refusal to endorse is based on measured supplier service performance not meeting Q1 requirements.

• FCSD does not have the full 6 months of data (Q1 metrics), and finds no reason to refuse endorsement (performance meeting Q1 requirements for fewer than 6 months). FCSD may "abstain" their endorsement.

o The Engineer must check "Waived" for the Service Endorsement in GSM. • FCSD does not have the full 6 months of data (Q1 metrics), but has at least 3 months of

performance not meeting Q1 requirements in the last 6 mature months. FCSD must inform the STA commodity manager, who must agree with the FCSD recommendation - that service performance prevents FCSD from abstaining their endorsement. FCSD data would need to show that the Site performance would result in a recommended Q1 Revocation. In this case, FCSD would recommend against Q1 for the Site.(Note: if FCSD or production Q1 metrics show that the Site could not achieve Q1 within 12 months of the Production Established date, the Site would receive a recommended Q1 status "X" Approval Denied, see section 7.15 above).

Also, Service endorsement is not required when the Site ships only production parts. • The Engineer should check "Not Required" for the Service Endorsement in GSM.

**MP&L endorsement is not required for special cases, such as those below. The list of these special cases is available through GSM. MP&L must check "Waived" for MP&L endorsement in GSM; for:

• Sites supplying only bulk material (e.g. steel, lubricants, refrigerants) • Sites supplying only "as required" (also applicable to service unique suppliers)


Procedure PSP-010





Ongoing metrics

7.18 Certifications and MP&L compliance 7.18.1 The Site is required to maintain the following certifications in good standing:

7.18.1.1 Third party certification to either QS-9000 or ISO/TS 16949. 7.18.1.2 Third party certification to ISO 14001 7.18.1.3 Compliance with MS-9000, MMOG or Odette via self assessment.

Note: MP&L waivers may apply, see the endorsement table notes above

7.18.2 The Site maintains the following certification / MP&L compliance data for each certification into GSDB On-line via FSP. The Ford POC (Point of Contact) may enter the data for Sites unable to access GSDB On-line. The following fields in GSDB are updated as below:

• Certificate Date: Date of current certification / MP&L compliance (e.g. renewal date).

• Certificate Number/Level: for MS-9000 use Score, for MMOG/Odette use Level, for third party certifications enter certificate number.

• Registrar: for MS-9000/MMOG/Odette: enter "Self-assessment", for third party certifications (QS-9000, ISO/TS 16949 or ISO 14001), enter registrar name.

• Registration Champion: Name, Phone, Fax, and e-mail, (primary Site contact for the certification).

7.18.3 Valid certifications are not expired and are accredited.

7.19 Manufacturing Site Assessment 7.19.1 Site must have an acceptable Site Assessment per the Manufacturing Site

Assessment Expectations or prove the effectiveness of a Corrective Action Plan.

7.19.2 The initial Site Assessment is conducted on-site. Note: Greenfield sites will be assessed using surrogate data and complete a Manufacturing Site Assessment, including any corrective action plans, prior to 1PP. – Sourcing approval for Greenfield sites is documented on PP-S-F005.

7.19.3 The Engineer updates GSM with the Site Assessment results.

Ongoing Performance to Earn Q1 7.19.4 The Site must maintain an overall Q1 Score of at least 800 points. 7.19.5 Full site self-assessments are required:

Segment I and II and unsegmented sites: every 6 months. Segment III and IV sites: every 12 months.


7.19.6 Ford on-site assessments may be required for follow up on corrective actions to address any area of supplier quality management system not meeting Q1



Procedure PSP-010





Ongoing metrics

requirements, as identified in the self assessment or as shown by supplier performance.

Note: STA Segmentation definitions are shown in the STA Segmentation Standard.

7.19.7 Self-assessing Sites submit their Assessment results to the Engineer for review.

7.19.8 Site must have at least 6 continuous months of shipping history. 7.19.8.1 For service unique suppliers, the 6 months of shipping history need not

be continuous, but must be within a 12 month period. 7.19.9 The Engineer confirms that the following thresholds have been satisfied using

the Site SIM Q1 Performance screen:

Threshold Field Actions 0 in most recent 6 months with any supplier

responsibility* Stop Shipments 0 in most recent 6 months with any supplier

responsibility** PPM: For both Production and Service (Service shipments to US and Ford of Europe Receiving locations only)

PPM Low Commodity Comparison points between –50 and 100, as shown in the Ongoing Performance Section of SIM.

Delivery: For both Production and Service (Service shipments to US and Ford of Europe Receiving locations only)

Delivery points between 0 and 100, as shown in the Ongoing Performance Section of SIM.

Manufacturing Site Assessment 0 points in SIM, showing an acceptable Site Assessment

Capable Systems 0 points in SIM, showing the Site has all required certifications

More details on SIM Ongoing Performance are available in the Q1 training * Supplier identification and timely resolution must be reviewed and approved at the Regional STA Director level on form PP-S-F008 (Field Service Action Change Request) before any Q1 impact can be waived. ** Supplier identification and timely resolution must be reviewed and approved at the Regional STA Director level on form PP-S-F009 (Stop Shipment Change Request) before any Q1 impact can be waived. The suspect components must not have been used in Ford production for a waiver to be considered.


Q1 Application

Procedure PSP-010





Ongoing metrics

7.20 The Engineer reviews the Site data for conformance with the requirements listed in sections 7.17 through 7.19.9 of this procedure.

7.21 If the requirements are met as above, the Engineer: 7.21.1 issues a Q1 Letter to the Site, signed by the Core Buyer management and STA

direct report to the STA regional Director. 7.21.2 The Q1 letter should be sent to the supplier Site manager with internal Ford

copies to the MP&L and FCSD Managers (as appropriate). The Q1 letter must be sent to the Q1 Coordinator. Do not list the cc recipients on the Q1 Letter.

7.21.3 requests an update of the Q1 status code to "Y-Q1 Approved" in GSDB, per Appendix A. Note: Updating the Q1 status to "Y" in GSDB initiates the Q1 plaque and flag ordering process. Note: section 8.10 provides guidance on payment terms for plaques and flags.

7.22 The Q1 coordinator retains the record copy of the Q1 letter per section 9 of this procedure.

7.23 If the requirements are not met as above, the Engineer: 7.23.1 obtains concurrence from the Engineer's supervisor that the Site has not met

the Q1 requirements 7.23.2 informs the Site of deficiencies, assists in developing an action plan and

updates GSM appropriately.

Q1 Revocation 7.24 The Engineer monitors the Site SIM Q1 Performance Screen. Violation of any of

the thresholds in the table below will result in a recommended R "Q1 Revoked" status.

7.25 Prior to updating the Q1 status in GSDB to "R" or sending the revocation letter to the supplier, the Engineer updates GSM to indicate the actions being taken and obtains approval of the revocation from the following:

• STA management (direct report to the STA regional Director) • Purchasing management (level in Purchasing equivalent to the STA direct

report to the STA regional Director) of the organization wishing to revoke Q1. Additionally, STA management shall inform in writing the following of each Q1 revocation prior to issuing the Q1 revocation letter or initiating the update of the Q1 status in GSDB: • The STA Executive Director • The STA regional Director and, if applicable, the affected organization head

(e.g., brand manager) • The affected Purchasing Executive Director • The affected organization/brand Purchasing Manager and Director


Procedure PSP-010





Ongoing metrics

• The supplier site management • Ford Labor Affairs (for a UAW Visteon site) • Manager of Public Affairs for Purchasing (all Visteon sites) • The ford Purchasing Visteon Liaison Manger (for Visteon sites only)

7.26 The Engineer then requests an update of the Q1 status code to R -"Q1 Revoked" in GSDB, per Appendix A.

The site is recommended for revocation of Q1 status if the Q1 score falls below 800 points or any of the following situations occur: Field Service Action with any supplier responsibility* 2 or more stop shipments with supplier responsibility** PPM For both Production and Service (Service shipments to US and Ford of Europe Receiving locations only) Monthly commodity PPM exceeds any relevant industry commodity PPM in any of the five forward month after the six month commodity PPM exceeds the industry commodity PPM by 100% or more, with the site PPM greater than 110, leading to a PPM commodity comparison of –250 points in SIM. Delivery For both Production and Service (Service shipments to US and Ford of Europe Receiving locations only) The supplier site immature month, most recent 2 mature months and 6 month weighted average delivery ratings all fall below 81 points, leading to a delivery rating score of –250 points in SIM Manufacturing Site Assessment is delinquent, or the corrective action plan is delinquent or ineffective in execution.*** Loss of certification to ISO 14001, QS-9000 or ISO/TS 16949. Violation of Trust****

* Supplier identification and timely resolution must be reviewed and approved at the Regional STA Director level on form PP-S-F008 (Field Service Action Change Request) before any Q1 impact can be waived. ** Supplier identification and timely resolution must be reviewed and approved at the Regional STA Director level on form PP-S-F009 (Stop Shipment Change Request) before any Q1 impact can be waived. The suspect components must not have been used in Ford production for a waiver to be considered. *** If the STA site engineer chooses to use the two step process, the second STA


Procedure PSP-010





Ongoing metrics

notification to the supplier of any of the following conditions within a 6 month period will result in a recommended revocation of Q1:

• Late site assessment, or • Corrective action plan not submitted to Ford STA site engineer within 30 days

after the site assessment, or • Corrective action plan is ineffective in its execution.

**** Violation of Trust criteria include: supplier fails to get approval from Ford for: • Manufacturing process change (including tooling), or location change • Component or material change or substitution • Subcontractor or vendor change

Other criteria may include: • Launch ramp-up or rate of climb which aversely affects the Ford plant build

schedule • Self certified PSW is incomplete or inaccurate • PSW supporting data lacks integrity • Other trust issues impacting the ongoing business relationship with Ford.

7.27 The Q1 Coordinator publishes monthly recommended Q1 status summaries. 7.28 If the Engineer disagrees with the recommended "R" Q1 status, the Engineer

"postpones" the Q1 status change per 8.4 of this procedure 7.28.1 If the data driving revocation include production delivery issues, the Engineer

consults with MP&L before postponing the status change. 7.28.2 If the data driving revocation are entirely service issues, FCSD STA may

postpone the status change per 8.4 of this procedure. 7.29 For quality issues, if the Engineer agrees with the recommended "R" status, the

Engineer: 7.29.1 Within 15 working days of the SIM recommended status change, and in

consultation with the Buyer, the Engineer issues a Q1 Revocation Letter (see 3.5) to the Site, approved by a Purchasing Commodity Manager who is a direct report to a Purchasing Director (or higher) and an STA Manager who is a direct report to the STA regional Director (or higher).

7.30 For delivery issues, the Engineer obtains MP&L concurrence with the recommended R status. MP&L then removes their endorsement for the site from GSM, and the Engineer:

7.30.1 Within 15 working days of the SIM recommended status change, and in consultation with the Buyer, the Engineer issues a Q1 Revocation Letter (see 3.5) to the Site, approved by MP&L Manager (as appropriate), Purchasing Commodity Manager who is a direct report to a Purchasing Director (or higher) and an STA Manager who is a direct report to the STA regional Director (or higher).


Procedure PSP-010





Ongoing metrics

7.31 The Q1 Revocation Letter should be sent to the supplier CEO with internal Ford copies to appropriate Purchasing Commodity Management, FCSD and MP&L Managers (as appropriate) and Buyer. The Q1 Revocation letter must be sent to the Q1 Coordinator. Do not list the cc recipients on the Q1 Revocation Letter.

7.32 The Engineer ensures that the Site no longer displays the plaque and flag. This may be accomplished by either of the following:

• The Engineer may either retrieve the plaque and flag from the revoked Site, or

• The Engineer instructs the site management to return the plaque and flag to the Engineer. Note: if possible, the plaque and flag may be reused. If not, they should be destroyed. The Engineer should remind the revoked supplier that while Q1 is revoked, all uses of the Q1 logo are not permitted, especially on stationary, correspondence and advertising.

7.33 The Engineer requests an update of the Q1 status code to "R-Q1 Revoked" in GSDB, per Appendix A.

7.33.1 The Engineer and MP&L, as appropriate, assist the supplier in the development of a Q1 reinstatement plan and enter the work plan in GSM. Note: "Short term eliminate" within more than 12 months is not an acceptable work plan.

Loss of Q1 through Site inactivity 7.34 If a Site has not shipped production or service parts directly to a Ford facility for 13

consecutive months, the Site is considered inactive. Note: Sites with A-Awaiting Q1 Approval status and no PE date are exempt from this deactivation process.

7.35 At least monthly, the Q1 Coordinator/FCSDDATA: 7.35.1 identifies Sites not shipping parts for 13 months 7.35.2 notifies the Engineer of the recommended Site deactivation at least 5 business

days prior to the deactivation 7.35.3 If the Engineer disagrees with the recommended Site deactivation, the

Engineer "postpones" the deactivation by responding to the Q1 Coordinator or FCSDDATA with a management approved request to postpone deactivation. The request for postponement must be based on data.

7.36 Reinstatement from deactivation requires the normal Q1 process (7.6).

Loss of "Q1 Requirements Waived" (W) Status


7.37 Sites must renew their Q1 Waivers every 12 months by full approval and submission as specified in Purchasing Procedure 2.1.5. If annual approval is not granted, SIM will recommend a Q1 status code "X" – Q1 Approval Denied.

Procedure PSP-010





Ongoing metrics

7.38 If a "waived" Site violates any one of the Field Actions, Stop Shipments, PPM or Delivery thresholds listed in the table in section 7.26 above SIM will recommend a Q1 status code "X" – Q1 Approval Denied.

7.39 If the Engineer disagrees with the Q1 recommended "X" status, the Engineer "postpones" the Q1 status change per 8.4 of this procedure

7.39.1 If the data driving the recommended status change contain both production delivery and quality issues, the Engineer consults with MP&L before postponing the status change.

7.39.2 If the data driving the recommended status change are entirely production delivery issues, MP&L may postpone the status change per 8.4 of this procedure. If the Site is both production and service active. STA production will discuss with FSCD the justification for the postponement.

7.39.3 If the data driving the recommended status change are entirely service issues, FCSD STA may postpone the status change per 8.4 of this procedure.

7.40 For quality issues, if the Engineer agrees with the recommended "X" status, the Engineer:

7.40.1 Updates the Q1 status code to "X" Approval Denied, per Appendix A 7.41 For delivery issues, if MP&L agrees with the recommended status, the Engineer:

7.41.1 Updates the Q1 status code to "X" Approval Denied, per Appendix A, with MP&L concurrence.

7.41.2 The Engineer (and MP&L as appropriate) assists the Site to develop a Waiver restoration plan and records the plan in GSM.

Q1 Reinstatement 7.42 Q1 status remains revoked for at least 6 months from the date of the revocation letter.

Note: a Site rated "X" (Approval Denied) may also meet Q1 requirements by successfully completing steps 7.43 through 7.44. This status however, is typically achieved only after major improvements at the Site.

7.43 The Site must meet all Q1 Site Qualification criteria (7.17 to 7.23.2). Endorsements are limited to only those removed as part of the Q1 Revocation. STA may provide assistance in the recovery of endorsements. Note: The letter indicating reinstatement of Q1 must be approved by the STA direct report to the STA regional Director and by the Core Buyer management, (see 7.21.1). Section 8.10 provides guidance on payment terms for plaques and flags.

7.44 For suppliers with Q1 revoked for delivery issues, the Engineer may assist MP&L in determining the root cause(s) of the delivery issues. MP&L recommends supplier corrective action. The Engineer may then assist MP&L in implementation of the recommendation.

7.44.1 The Engineer and/or MP&L enter(s) the Q1 reinstatement plan in GSM Supplier Technical Assistance (STA) Printed copies are uncontrolled

Procedure PSP-010





Ongoing metrics

8 GENERAL RULES

Q1 Status Code Updates 8.1 For production only or production / service Sites, although the Engineer requests

Q1 status code updates, only the Q1 Coordinator / FCSDDATA has the authority to update the codes in GSDB.

8.2 The Q1 Coordinator / FCSDDATA will update all code changes only with receipt of the appropriate Q1 letter or form (see Appendix A).

Tier 2 Sites 8.3 Tier 2 Sites have no direct product shipments to any Ford facility and therefore, do

not qualify for Q1.

Recommended Q1 Status Code Postponement Process 8.4 When a Site is recommended for a Q1 status code change by SIM, and the Engineer

/MP&L wishes to postpone the change: The Engineer must get approval in writing from the Engineer's supervisor to postpone the Q1 status change. For delivery issues, the Engineer must consult with MP&L and obtain MP&L concurrence with the postponement of the code change. In GSM, the Engineer selects "yes" in the override Recommended Q1 status field and enters a clear and complete override reason. MP&L notes the supplier recovery plan in the MP&L Action Plan in GSM. Note: The Engineer's supervisor should consider the suspect data and the effectiveness of planned corrective actions when reviewing the justification for Q1 status change postponement For each brand in Europe, a central individual may be assigned the responsibility of coordinating these code change postponements and flagging of the Site in GSM. The Engineer has 3 months to implement the code change or correct the data.

Moving Q1 8.5 Sites are not permitted to move Q1 from one manufacturing location to another,

(i.e. the Site cannot change address and retain Q1). The new Site will need to qualify for Q1 as any other new Site.

Supplier Site Acquisition or other major change


Procedure PSP-010





Ongoing metrics

8.6 Per QS-9000 Sanctioned Interpretations and ISO/TS 16949 Ford customer specific requirements, the supplier notifies the registrar and customer of any significant ownership or quality system change.

8.6.1 The Engineer assesses the impact of the Site change and determine if the Q1 status of the Site is affected.

GSDB Currency Site Codes 8.7 Where multiple GSDB Site codes are established for one physical location under a

parent, one Site code will be designated the Quality Role (primary) Code. The Quality Role (primary) code will be used to summarize and report quality data and indicate the STA active status and Q1 status for the Site. Other alias codes for the Site (i.e. currency codes) indicate the designated Quality Role (primary) Site in their Quality Role pointer in GSDB. Q1 status for the alias Sites is indicated by the Q1 status of the Quality Role (primary) Site. Multiple "primary" GSDB codes are only permitted if the Site has multiple supplier parents linked to it, for example, under "virtual" sites used to support the direct ship tier 2 scenario.

Service Q1 and Production Q1 8.8 Where a Site has earned production Q1, Service may source the Site after the

following steps: Activate the Site in GSDB for Service STA and assign a Service STA engineer to the Site

•

• Conduct a successful Site Assessment as required (the FCSD engineer discusses the need for a Site Assessment with Production).

Reversal of assignment of Q1 status code 8.9 Where data corrections warrant the reversal of the assignment of a Q1 status change

(e.g. a Revoked Q1), the authority required to reverse the original status assignment is the same level as the individuals who assigned the original status change, or the next higher level of management in the same organization.

Plaque and Flag payment terms 8.10 Ford will pay for the plaque and flag awarded to a supplier whenever the supplier

site gains Q1. This applies to both initial earning of Q1 or reinstatement of Q1 after having been revoked. The supplier pays for all other instances (replacements due to wear and tear or extra


Procedure PSP-010





Ongoing metrics

copies).

9. RECORDS

The following records are to be identified on the STA Master Records Index and retained in accordance with the Global Information Standard 1:

Record GIS1 Retention Schedule Q1 Letters / Q1 Status update forms 26.01 C + 3 yrs. Non-Q1 Sourcing Approval Request 26.01 C + 3 yrs. Recommended Q1 status report 02.01 S


Date Approved by: 02/14/2002 D. Velliky OCM, initial release 05/16/2002 C. Burford 10/21/2002 D. Velliky OCM 04/25/2003 D. Velliky OCM Q1 2nd Edition update 27 May 2004 D. Velliky OCM Revocation notifications 23 July 2004 D. Velliky OCM Revocation notifications

30 July 2004 D. Velliky OCM FSA Change Request added NOTE: Indicates area of change from previous issue (not yet marked with areas of revision in this document)


Procedure PSP-010





Ongoing metrics

Appendix A: Updating Q1 Status Codes

Awaiting Q1 Approval (A)

Q1 Achieved

(Y)

Q1 Requirements

Waived(W)

Q1 ApprovalDenied

(X)

Yes

Q1 not possible, but good quality

NoQ1 Site Assessment Required (D)

Manufacturing Site

Assessment

Meets Q1 Standards?

Q1 Revoked(R)

Q1possible

NewSite

Does not meet Q1 Requirements

Tier 2 - not shipping to

Ford(2)

Site approved prior to

activation in GSDB

Q1 not possible within 12 months of PE

Begin Q1 process

again

Q1 status code summary

Requesting and Implementing Q1 status codes

"D" = Q1 Site Assessment Required The Q1 Coordinator receives the site activation request from the Site Active/Inactive screen in GSM and then updates the GSDB screen.

"A" = Awaiting Q1 Approval The Engineer submits a copy of the signed Q1 status change form PP-S-F005 to the Q1 Coordinator, whose contact information is available via CDSID "STAGSDB". For service unique Sites, the Engineer submits the form to "FCSDDATA".

"W" = Q1 Requirements Waived The Buyer submits a signed (Form PCPF012) Non - Q1 Sourcing Approval Request to the Q1 Coordinator, whose contact information is available via CDSID




Procedure PSP-010





Ongoing metrics

"STAGSDB". For service unique Sites, the Engineer submits the form to "FCSDDATA". Approval level instructions are provided by procedure P-P 2.1.5 - Sourcing to a Non- Q1 Supplier.

"X" = Q1 Approval Denied The Engineer submits a copy of the signed Q1 status change form PP-S-F005 to the Q1 Coordinator, whose contact information is available via CDSID "STAGSDB". For service unique Sites, the Engineer submits the form to "FCSDDATA". Q1 status code "X" may be triggered for 4 different reasons:

1. The initial Manufacturing Site Assessment indicates that the Site will not meet Q1 requirements within 12 months after PE date.

2. The Site was awarded "A" – Awaiting Q1 Approval but violated one or more of the thresholds specified in 7.15.2 of this procedure. SIM will recommend a Q1 recommended "X" status. Section 8.4 of the procedure shows the explanation and code update process for Q1 code X.

3. The Site did not achieve Q1 within 12 months of PE date. SIM will recommend a Q1 recommended "X" status. Section 8.4 of the procedure shows the explanation and code update process for Q1 code X.

4. The Site lost its Q1 Requirements Waived status The Site violated performance thresholds or the Waiver expired, see 7.37 of the procedure.

The Engineer justifies the use of the "X" code by indicating the type of Approval Denied status (one of the 4 above) on the Q1 status change form PP-S-F005

"Y" = Q1 Achieved The Engineer submits a copy of the signed Q1 Letter to the Q1 Coordinator, whose contact information is available via CDSID "STAGSDB". For service unique Sites, the Engineer submits the letter to "FCSDDATA".

"R" = Q1 Revoked The Engineer submits a copy of the signed Q1 Revocation Letter to the Q1 Coordinator, whose contact information is available via CDSID "STAGSDB". For service unique Sites, the Engineer submits the letter to "FCSDDATA".

"2" = Tier 2 The Engineer submits form Q1 Status Update Request PP-S-F005 to the Q1 Coordinator (CDSID "STAGSDB"), requesting the assignment to the Site of Q1 status "2".




Procedure PSP-010





Ongoing metrics

Upon receiving a Q1 Status change request the Q1 Coordinator:

• Updates the Global Supplier Data Base (GSDB) to reflect the Q1 code change • Files the letter / form

SIM shows the updated status code within 48 hours of GSDB update.


Case for Change

Documents

ford motor company participant

ford motor company topics

change objectives

change introductionwhat

lasting change

redundant ford requirements

ford system action plan

supplier quality capabilities