Since 1993

YEARS

IATF 16949:2016 - UNDERSTANDING TRAINING

Course code : QM/IF/G/15

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Understanding Quality Management Principles
Quality Management Principles List Examples of how your organization demonstrate
this requirements

Customer Focus

Leadership

Engagement of people

Process approach

Improvement

Evidence-based decision making

Relationship Management

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Case Study
The Dolex Manufacturing Company is a supplier of screw machined parts to General
Motors, Ford and several first tier automobile suppliers. They have been supplying
parts to the automobile industry for the last 40 years. The company has grown 25%
in the last three years. In the first two years, several of the older employees retired.
The work force is relatively young with the majority having less than seven years of
experience.
The company is managed by the son of the owner. They have eighty five employees
operating on three shifts. The first and second shifts have 45 employees in
manufacturing and the night shift has a skeleton crew of 20 employees. The
administrative staff includes the Owner, CEO & Plant head, Quality Manager, two
engineers, two Supervisors, six inspectors, and two associates. The remainder
includes Officers and clerical staff.
The company has a reputation for high quality. They are known as an aggressive
company that take on challenging jobs. The manufacturing processes in the plant
include screw machines, Lathes and CNC as primary operations and milling, drilling,
punching, broaching and grinding as secondary operations. They are IATF 16949
certified and in the process of implementing EMS & OHSMS certification.
The company is profitable and should grow by up to 10% in the coming year due to
new jobs that are forecast to increase in volume in the next two years.
The previous year and the first half on this year have been problem with product
launch. Machines were purchased that did not perform to expectations. The
company would have been the cause of a launch bottleneck, if the OEM had not
decreased the launch volume schedules due to its own internal problems. However,
top management remains committed to continuous improvement and the New
product development process.
External reject costs have fallen because of Dolex’s commitment to continuous
improvement. However, internal inspection costs have increased because of the high
percentage of new employees.
The training/orientation program for new hires has not yet been proven effective. The
existing OEM’s are expecting price reduction of 20% over the last year. The OEM is
investigating to manufacture the part by forming process to reduce the cost.

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Insights and observations :

Owner

The owner has set financial objectives of return on assets to exceed 10% and profit
margin on sales to exceed 6% year over year. Over the last three years, ROA has
declined from a high of 16% to a return of 5.5%. During the same period, the profit
margin on sales has decreased by 40% to 11.5% for the recent fiscal year.
Other costs such as workers compensation have increased by 15% over the last
three years.
The fully-funded pension plan is not meeting expectations. To meet the projected
obligations, the investments must earn a minimum of 9% per annum. Investment
return has averaged only 2.5% over the last four quarters. We will have to come up
with a better investment strategy.
The bank wants Dolex to become more liquid.
CEO
The management has told us to reduce our internal inventory levels. The average
inventory held at the customer's plant has decreased from 30 to 20 days. We are
attempting to decrease our own internal levels proportionately.
Our major shaft customer is increasing shaft releases by 30% over the next two
years. No capital is budgeted for CNC machine acquisitions; thus current uptime
efficiencies on the CNC machines will have to improve to at least 75% if production
is to meet the potential shaft schedule increases.
The Purchasing team is reporting significant commodity price increases, particularly
for steel this year with forecasts that these are moderating. Ford wants to see
continual improvements from our supply base. We need to get our entire supply
base to ISO 9001 certified.
Regulation has mandated that we comply with the noise level standards in our CNC
machine department. This was one of a number of problems cited on a recent audit.
We will need a cooperative effort from training and Engineering to eliminate potential
safety health violations.
Quality Manager
Ford wants to see continual improvement in our Quality survey scores. Systematic
internal auditing of our quality system is critical to improving our survey scores.
The owner wants to improve the cost effectiveness of training. As a whole, training
hours per employee have decreased from 45 to 24.2 hours per year over the last
year. A training assessment survey points to deficiencies in machine setup (primarily
for new employees), use of SPC, and procedures knowledge.

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A number of customers want to see improvements in our gage program. With limited
manpower in the Q.C. department, we must increase the percent of the workforce
trained in GR&R methodology. Engineering will have to play a major role in
decreasing the number of attribute gages utilized.
Manufacturing process Engineer
Our employees expect a safe workplace. The owner established a safety objective of
two or less incidences for this year. Accident frequency has increased over the last
year. There were two lawsuits filed against the company for unsafe conditions in the
past five years. This has resulted in significant increases in our worker’s
compensation premiums. We must train the work force better and engineer out
unsafe conditions.
The owner wants us to improve the accuracy of cost estimates. We must improve
the percentage of jobs that come in on or under budget. There is some concern that
the costing system standards are inaccurate.
Workers have complained about the old CNC machine ergonomics. The controls’
location require excessive bending and reaching.
Neighbors near Plant 1 have complained about the smell from the stack in the
summer months.

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Date : Internal & External Issues Worksheet Format Code:
Date of Revision : -
Date of Review : -
(EHS/QMS) Revision No :

Categories Issues Issues Issues

External

Categories Issues Issues Issues

Internal

Prepared By : Approved By :

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Issue Date : Format Code:
INTERESTED PARTY NEEDS & EXPECTATIONS WORKSHEET (EHS/QMS) Date of Revision : -
Date of Review : - Rev No:
Sr No Interested party Needs and Expectations Remarks
External

Internal

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 #3

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 Format Code:

Issue Date
Review Date
RISK ASSESSMENT WORKSHEET (EHS/ QMS)
Rev No

Rev Date -
Current
S. Risk / Risk Responsi
Issues Category O/R Impact Controls? Severity Probability Actions to be taken Date Status
No. opportunities Level bility

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 SEVERITY CRITERIA (based on Effect)

SEVERITY CRITERIA CRITERIA RATING

Critical Has the potential to seriously effect the business or customer satisfaction or legal compliance 5

Major Has the potential to significantly effect the business or customer satisfaction 4

Moderate Has the potential to moderately effect the business or customer satisfaction 3

Minor Has the potential to slightly effect the business or customer satisfaction 2

Negligible Has negligible effect on the business or customer satisfaction 1

PROBABILITY CRITERIA (based on risk)

PROBABILITY CRITERIA RATING

Certain Risk occur very frequently 5

Likely Risks occur atleast once / twice in a month 4

There is a chance of occurrence and previously

Possible 3
happenned occurances

The chance of occurring is rare may be once in a

Unlikely 2
year

Rare The most unprobable chance of a risk occurring 1

Risk Level
PROBABILITY (P)

0 1 2 3 4 5

1 1 2 3 4 5

2 2 4 6 8 10

SEVERITY 3 3 6 9 12 15
(S)

4 4 8 12 16 20

5 5 10 15 20 25

Identify contingency plan in your function

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Identifying Quality objectives of your function / Level

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