Ken Faith

Assistant Director Supplier Quality, PACCAR

How can we Improve our Partnership

PACCARs Quality Framework
PPAP Self-Certification
2017 Training Topics
Shared Supplier Training
How Can We Improve Best Practices Sharing
Global Corrective Action Feedback
Other Ideas
Submit Responses to Ken.Faith@PACCAR .COM

Quality Framework
Quality Policy

Objectives

Standard Policy Bulletin

SP1

Defect Free Launches

Quality
All PACCAR products and services will enhance the
Companys reputation of providing unsurpassed customer
satisfaction through superior quality and premium value.

Supplier Quality Scorecard

5 PPM
A

100%
A

Defects

PPAP Approval

Defect Free Suppliers

Continuous Improvement
Behaviors

99%
A
On Time Delivery

Key Indicators
High Performing Suppliers

Global PPM
PPM

PPM

07 08 09 10 11 12 13 14 15 16 17 18 19 20 21

< 50PPM

<10 PPM

07 08 09 10 11 12 13 14 15 16 17 18 19 20 21

Global Corrective Action Strategy

Standardized Process
Recovered Costs for Non-Conforming Parts
Increased Corrective Actions 5,000
Automate Corrective Action System

2016

Impose Penalties - Late Responses & Repeat Issues

2017

Global Corrective Action Strategy

Implementation Plan
Phase 1 - Penalties for
NCPs & Rework

Phase 2 - Globalize Corrective

Action Process

2015
Automated Corrective Action System

2016
Kenworth,
Peterbilt,
Kenmex &
Dynacraft

2017

DAF, BAP,
CEP, KWA, LT

High Level Flow Chart

KWA
(Mainframe)

Leyland
(Mainframe)

DAF
(Mainframe)

Brasil/CEP
(Mainframe)

NCP Records
NCP records

NCP records
NCP records

NA Truck Plants
(Mainframe)

KenMex
(Mainframe)

NCP records

SAP
Corrective Action
System
NCP records

ePortal
NCP records

2016
2017
Out of Scope

Dynacraft

Suppliers and PACCAR

Quality & Production

Supplier
Performance
Dashboard
Cost Recovery
Charges to
Accounting

Report to Six Sigma

Supplier Cost of Poor Quality Policy

Administrative Charge per NCP Report = $300

Phase 1

Minimum Rework Charge Per Part = $400

Leveraged Existing Accounting Debit Process
Developed Plant Calibration Guidelines

Corrective Action System

Phase 2

10/30 Plan

24/3/

Late Corrective Actions - $300/$300

Penalty for Repeat NCPs - $900

Benefits
Faster Corrective Action Implementation
Less Time to Manage
Provides Supplier Accessibility
Manage All Supplier Corrective Actions
Reduce Repeat Issues
Many New Dashboard Reports New Accounting Report
On-Line Disputes
Globalized Process

FAQs
Q: How Do I Access the System?
A: Standard ePortal/SupplierNet Access
Q: What is the Purpose?
A: Quality Improvement the new system provides the capability to manage
corrective actions for ALL non-conforming parts
Q: When Does the System Implement?
A: Go-Live November 17. Supplier Penalties Begin January 3, 2017

FAQs
Q: Is this a Global System?
A: Yes, The Remaining Locations Are Scheduled to Implement in Late 2017.
Q: What are Some of the Other Benefits?
A: 100% Traceability, Return Good Authorization Tracking, On-Line Dispute
Capability, Near-Real Time Supplier Notifications, Internal Corrective Action
Tracking Capability & Standard and Unlimited Reporting
Q: Where Can I get More Information
A: Training Material including Videos Will be Posted to SupplierNet

PACCAR ePortal Navigation

For PACCAR facilities in North America & Australia:
https://eportal.paccar.com/supplier/supplier/en/home/Pages/default.aspx

For PACCAR facilities in Europe & Brasil:

https://eportal.daf.com

PACCAR North America ePortal

PACCAR Sponsored AIAG Memberships

PACCAR Sponsored AIAG Memberships

PACCAR SQRM

2017 SQRM Updates

Section
1.3
1.5
3.1
3.2
3.2
3.4
5.5
6

11

Change
Added reference to the new IATF 16949/ISO 9001 standard
Updated supplier certification requirements, removed reference to ISO 9002,
updated ISO 14001 requirements, added OHSAS 18001 expectations, updated
REACH requirements
Updated supplier performance standards to align with the Purchasing SPM
program for North America
Updated definition for production disruption
Added new Corporate Standard CPS0495 outlining containment requirements
Supplier ISO/TS registrar self-reporting for Controlled Shipping (CS)
Added PACCAR proprietary tooling and equipment section
Updated with new Corporate standard CPS0515
Updated Supplier Charge Back Policy added penalties for late corrective
actions and repeat issues North America commercial truck plants and
Dynacraft
Added change management section

IATF 16949:2016
November 2016

IATF 16949:2016
Key Enhancements
RISK BASED THINKING
INTEGRATION OF CUSTOMER SPECIFIC REQUIREMENTS
FIRST AND SECOND PARTY AUDIT COMPETENCY
PRODUCT SAFETY
MANUFACTURING FEASIBILITY
WARRANTY MANAGEMENT
DEVELOPMENT OF PRODUCTS WITH EMBEDDED SOFTWARE

Focus on Quality Performance

Link between ISO/TS 16949 certification and supplier quality
performance
Increased focus on operational performance and customer feedback (customer
scorecards/metrics)
IATF 16949 contains many IATF OEM Customer Specific Requirements
OEMs are raising the bar regarding expectations for audits to reflect systemic
weaknesses that affect supplier/client performance

Goal = Prevent problems before they occur!

New automotive standard:

IATF 16949:2016
IATF 16949:2016 follows the high level structure
of ISO 9001:2015
IATF 16949:2016 must be used in conjunction
with ISO 9001:2015
2 separate documents must be used to have
all requirements
IATF 16949 cannot be used as a stand-alone
requirements document

Timing of IATF 16949:2016

All sites currently certified to
ISO/TS16949:2009 must
transition to the new
standard by September 14,
2018.
Any audits taking place after
October 1, 2017 must be to
the new standard.

Section 1.5
Quality, Environmental, Health &
Safety Management Systems
ISO 14001
OHSAS 18001

10
PPM

Section 3. 1
Supplier Performance Standards
Alignment to Purchasing Supplier Performance Management (SPM)
PPAP On-Time %
PPAP Approval %
On-Time Delivery %

10
PPM

Section 3. 1
Supplier Performance Standards

10
PPM

Section 3.2
Cost of Poor Quality Policy
PPM Metric
Potential Problems Corrected before Impacting PACCARs Value Stream
NCP Quantity Reduction Requests

10
PPM

Section 3.2
Cost of Poor Quality
New Corporate Standard CPS0495
Containment Requirements

10
PPM

Section 3.4
Controlled Shipping
ISO/TS Registrar Self-Reporting
Controlled Shipping Level 2

10
PPM

Section 6
Embedded Software Requirements
New Corporate Standard CPS0515

10
PPM

Supplier Charge Back Policy

Penalties for Late Corrective Actions
Penalties for Repeat Issues

10
PPM

Section 11
Section
1.3
1.5
3.1
3.2
3.2
3.4
5.5
6

11

Change
Added reference to the new IATF 16949/ISO 9001 standard
Updated supplier certification requirements, removed reference to ISO 9002,
updated ISO 14001 requirements, added OHSAS 18001 expectations, updated
REACH requirements
Updated supplier performance standards to align with the Purchasing SPM
program for North America
Updated definition for production disruption
Added new Corporate Standard CPS0495 outlining containment requirements
Supplier ISO/TS registrar self-reporting for Controlled Shipping (CS)
Added PACCAR proprietary tooling and equipment section
Updated with new Corporate standard CPS0515
Updated Supplier Charge Back Policy added penalties for late corrective
actions and repeat issues North America commercial truck plants and
Dynacraft
Added change management section

How can we Improve our Partnership

PPAP Self-Certification
2017 Training Topics
Shared Supplier Training
How Can We Improve Best Practices Sharing
Global Corrective Action Feedback
Other Ideas
Submit Responses to Ken.Faith@PACCAR .COM