Excess and Obsolete Inventory: Everybody’s Responsible
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One of the responsibilities for purchasing is to maintain a strong supplier relationship by providing critical feedback to the supplier from time to time. When there is a problem with a shipment or a sub-par performance of the product shipped, then the buyer should be in contact with the selling agent to determine the best and most timely solution to the problem.
The idea being not only to remedy a less than desirable situation, but to put safeguards in place that will help prevent a recurrence of the problem. Purchasing may issue a Supplier Corrective Action Request, (SCAR) if the issue cannot be resolved with a phone conversation or a quick site visit. In the event that there are problems with products such as electronic component repetitive failures, than a SCAR should be submitted to the supplier to initiate the corrective action and also to maintain an auditable record of all remedial actions.
Here is a strategy that purchasing may want to implement to help identify a root cause for problems. Whenever there are recurring failures of identical part number components, the SCAR should include not just the part number and quantity, but be sure to record the date codes on the products being returned for the corrective action analysis. Here is why: I have noted component failures where only certain date codes of a product line failed in the field. After a factory floor operations investigation, it was revealed that for one particular date code, a substitute employee at the manufacturer’s facility had been assigned to a process work station, replacing another employee who was not able to work that week.
Upon closer examination, it was learned that the individual standing in that week, had not earned a company training certificate indicating that proper training for that work station had not been performed. As a result, the untrained and therefore unqualified employee had compromised the process, (wafer etching) and therefore inadvertently precipitated early failures in the field. The over etching made the aluminum traces too thin to handle the rated current. When the operating current exceeded the trace handling capacity, the traces were blown open, causing a catastrophic field failure.
The analysis took me all the way back to the substitute worker with the root cause being inadequate methods for assuring employee training and qualification. It was only possible to detect this through date code auditing.
This is a good question to ask a manufacturer during the qualification process: “Do you cross-reference employee assignments to date codes?” If the answer is yes, ask for an example of the record and then ask if each employee receives a training certificate before being allowed to operate a particular wok process or station. If the answer is no, then ask how they are able to trace or audit a particular date code to an employee for accountability purposes.
I know the common perception is that date codes are used to guarantee “freshness” of components. Some products like electrolytic capacitors and batteries have limited shelf lives and date code tracking is important for this reason alone. However, most components have multiple years of shelf life and unless your company has use rules like the military -- 18 months -- then keep in mind that if your inventory turns several times a year, you probably don’t have a major concern.
At the very least, track your failure components by date code lots and you may discover that you are not the first customer calling in to your supplier for a given lot. I have called in date codes and been told that the manufacturer knew about the problem and was replacing the parts with no questions asked. This fore knowledge was possibly based on a discovery like the example above. Chances are that you were not the only victim of your SCAR research results.
Get ahead of the game by telling your customer repair department to save their failed parts if they see a trend involving identical date codes. If the trend is caught early enough, be sure to purge your work in process in kits and on the factory floor. The benefits of tracking trends by date code will become obvious to everyone once this practice is put into place.
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