SUPPLIER RATING SYS

TEM (SRS)
Supplier Management Meeting
4-Jan-2010
SUPPLIER RATING SYSTEM (SRS)
 The objective of Supplier Rating System procedure is to put contr
ols in place, after RCI or the supplier had identified a problem.
This is to protect RCI and the Customer and to ensure that the su
pplier are focused on driving to permanent corrective action.

 Supplier Rating System is a process used by RCI to fully assess a

nd monitor supplier performance with the view to rewarding suppli
ers who meet RCI’s expectations with ongoing and future supply r
elationships

 Any resulting from poor delivery, non-conforming business practic

e, or contractual violations would require a supplier to implemen
t a corrective action plan that ensure contractual obligations an
d established performance goals are met.
TOTAL SUPPLIER RATING
 Key measures for the Total Supplier Rating include the follow
ing:
 Quality Performance (DPPM and Quality Lot Rating)

– 50 points
 Quality Notices (Timely PPAP, CAR submissions, etc)

– 20 points
 Delivery (Late Shipments, Over/Under Shipment, etc)

– 30 points
TOTAL SUPPLIER RATING

Total Score Rating Explanation

Supplie 90-100 A Excellent
r Rating
75-89 B Good, improvement
recommended
60-74 C Average, improvement
requested
50-59 D Poor, immediate improvement
required
<50 E Very Poor, improve or re-source

The target for Total Supplier Rating shall be 75%. Failure to

achieve this rating will require an improvement plan to be
submitted by the Supplier to RCI.
QUALITY PERFORMANCE (50 POINTS)

Quality Performance
= Defect Part Per Million (60%) + Quality Lot Rating (40%)
DEFECT PART PER MILLION (DPPM)
The Supplier DPPM number is determined by totaling the number
of non-conforming production and/or service parts versus the to
tal
amount of production and/or service parts shipped.
Actual DPPM % Scorecard Rating
0 ~ 150 60
151~300 50
301~450 40
451~600 30
601~750 20
751~900 10
>900 0
QUALITY LOT RATING
The Quality Lot Rating is determined by totaling the number of
rejected lots versus number of inspected Lot

Rejected Lot Scorecard Rating (%)

0 40
1~2 30
3~4 20
5~6 10
>6 0
QUALITY NOTICES (20 POINTS)
The Quality Notices are assessed for the number of occurr
ences, with additional points charged for higher severity iss
ues. The rating system is listed below. The overall score sh
all be determined by subtracting the points from the occurren
ces.
Explanation Points per
Occurrences
Failure to provide SPC Data 2
Failure to provide ISO 9001 2
Failure to provide TS 16949 (if 2
applicable)
Failure to provide 3rd party 1
certification (if applicable)
Failure to provide material 1
certification
Failure to provide PPAP on time 2
QUALITY DOCUMENTATION (20 POINT
S)
Explanation Points per
Occurrences
Failure to provide 3D response 2
within 48 hours of notification
Failure to provide 8D response 3
within 7 days of notification
Failure to provide Lot Traceability 3
Failure to respond to any second 4
request for documentation
Failure to respond to a RCI 5
request to sort material at either
RCI or customer location
Failure to provide RoHS data 5
DELIVERY (30 POINTS)
The delivery are assessed against the total number of occurrenc
es,
with varying severity of types of complaints. The rating system
is
listed below. The overall score shall be determined by subtrac
ting Explanation Points per
the points from the occurrences. Occurrences
Late Delivery / no cost impact 1
No Advanced Shipping 1
Notification
Late Documentation 1
Late Delivery with cost impact 2
Failure to follow packaging 2
guidance
DELIVERY (30 POINTS)
Explanation Points per
Occurrences
Late delivery, line disrupted 3
Late delivery, line stoppage 5
Late delivery, customer 10
stoppage
Over shipment 1
Under-shipment, no line 2
disruption
Under-shipment, line stoppage 4
Under-shipment, customer 8
stoppage
CS-1 & CS-2 CONTAINMENT
CS Containment
CS-1 100% inspection of outgoing goods at the supplier
for a min of 20 days (or a minimum of 3 consecutive
shipments) without defect. Supplier is to maintain
inspection records and provide those records to RCI
CS-2 100% inspection of outgoing goods at supplier’s
facility utilizing a supplier funded certified Third party
for a minimum of 20 days (or a minimum of 3
consecutive shipments) without defect. Supplier is to
maintain inspection records and provide those
records to RCI.

Remark:
Poor performance supplier may require to perform
containment action CS-1 or CS-2 depend on the severity.
SUB-SUPPLIER CONTROL
 Suppliers are required to monitor their sub-suppliers perform
ance and to assure the quality of purchased parts and the man
agement system of their sub-suppliers.
 Suppliers are also recommended to perform their sub-suppliers
quality management system development with the goal of the co
ntinuous improvement. Conformity with ISO9001 and the RoHS Di
rective is the first step in achieving this goal.
 For automotive suppliers, the suppliers will get their sub-su
ppliers in compliance with or certified to the TS 16949 stand
ard.
CONTINUOUS IMPROVEMENT
Continuous Improvement is crucial to RCI Business. At a m
inimum we require that our suppliers manage their quality sys
tems to the same as ISO 9000 standards for the quality effort
s and to demonstrate continuous improvement in areas that ben
efit the customer with regards to quality, price and service.
RCI may visit any supplier site to assess its continuous
improvement programs, lean sigma practices, and make recommen
dations for improvement. In addition, RCI may deploy personne
l to focus on specific improvement issues, if needed.
Thank You