Leadership

In an age where companies are getting larger, the world is getting smaller, and the relationships between suppliers is growing even more and more complex, corporate responsibility is seeing an increase in focus across the board and the automotive industry is no exception. Ethical behavior on behalf of companies and the agents that work for them is a key component in long term sustainability.

Over the last decade, product issues have been covered up, investor interest has been put in front of the well-being of the customer base, and the pressures from both above and below have left many companies with questionable decisions that need to have a compass. Quality is just not a feature of a part, but a trait that should be present in the companies that the public has come to trust to keep them safe and prosperous. The link between quality and ethics is growing increasingly stronger as standards merge, and we see this blending in the new requirements for leadership in this Section.

What is it?

• A requirement for the organization to implement policies regarding corporate responsibility
• A structured new aspect of the organization to assure it acts in a manner that is responsible to all shareholders
• It gives employees a path toward reporting ethical and even criminal activity in the event that the company engages in “less than admirable” business practices.

How do I do it?

• Identify the areas of your organization that would benefit from “corporate responsibility” policies
• Familiarize yourself with the three required: Anti-bribery, Employee Code of Conduct, and Ethics Escalation.
• Identify how these three policies can be introduced in existing processes without additional processes, and identify to whom each process is applicable
• Draft the required policies
• Train and implement the policies into the documented information system, assuring you retain the training records for the employees affected

Tools and Techniques to achieve it

• Policy templates for the three policies required to be implemented (note it can be the same policy and cover the three topics)

Documents you can use to prove it

• Copies of the policy or policies taken from the documented information source
• Training and onboarding records
• Internal audit plans covering these policies and documented information of completed audits

Questions to ensure you know it

• What policies within your organization address these items?
• Who would need to be made aware of these policies?
• How and when does leadership communicate to the organization the policies and the importance of compliance to the culture of the organization?
• If an employee stumbled onto something they knew to be wrong, how would they alert the correct individuals?
• What processes do we have in place which inform employees of this information?

How can you fail at it?

• Don’t write the policies
• Fail to implement the policies
• Fail to train on the policies
• Make the policies stand-alone documents and do not tie them into existing processes that are already functioning
• Fail to identify those that the policy applies to so the facility only gets partial coverage
• Fail to update the policy with changes to the business climate

ISO/TS hinted at the ideas of both process effectiveness and process efficiency, however IATF 16949 makes it an expressed requirement. While it is common knowledge that processes for manufacturing items must have a way to judge their level of conformance (see Chapter 2 with The Process Approach and the Turtle methodology), it is now explicitly called out that efficiency must be included.

If we look at a shipping process it is not uncommon to see that on-time delivery is frequently included as a metric relating to effectiveness. However, additional measurement for efficiency must be included to comply with the additional requirements of IATF 16949.

In IATF 16949 there are two words that are always found together:

• Effectiveness
• Efficiency

Effectiveness must come first, as it doesn’t matter how well you do things if you are not doing the right things. However, both measures are required for all processes both core to the organization’s business (i.e. product realization) and supporting processes. As a practical example the above shipping process may be refined for both effectiveness and efficiency through the below metrics:

• Effectiveness - % of on-time delivery
• Efficiency - Premium freight costs

Most of the time efficiency measures are measured through budgetary terms and both are essential to make a healthy and viable supply chain (a company that pays 30% premium freight to make certain they do not miss a shipment will not be in business long).

What is it?

• A requirement for both efficiency and effectiveness measures on processes
• Applies metric measurement to those processes relating to realization, and the supporting processes that contribute to them
• It gives a way to evaluate the level of performance to processes that directly support an organization’s core business
• Adds in the requirement for these process metrics to be placed into Management Review

How do I do it?

• Identify the processes listed in the process and interaction map
• Identify the customers both internal and external for each of these processes
• Identify how you could judge the effectiveness and efficiency of these processes using the internal and customer requirements
• Enter the metrics into the Management Review to ensure they are part of the organization’s Management Review meetings

Tools and Techniques to achieve it

• Process Mapping
• Turtle Diagrams
• Assignment of process owners and matching them to processes
• Management Review templates
• Process and Interaction Map

Documents you can use to prove it

• Process Maps
• Management Review meeting notes and slides (inc. minutes and records)
• Process and Interaction Maps with measurement data

Questions to ensure you know it

• What processes do I have in place that I would classify as within the scope of my QMS?
• Who are the customers of these processes, both internally and externally?
• Am I measuring process effectiveness and efficiency in a way that aligns with those customer’s perceptions of value?
• Do I have measures for all the processes in my Process and Interaction Map
• Do I review each one of these measures in Management Review?

How can you fail at it?

• Only provide metrics for those processes that affect direct manufacturing
• Have measurements that do not tie back to an organizations needs
• Fail to place the measures into Management Review

Process owners are a huge portion of IATF 16949, as they have the ultimate responsibility to provide resources and affect process performance. Below are common traits to all processes, note process ownership is one of the key items:

• Inputs
• Outputs
• Transformation
• Ownership
• Measurable

Under IATF 16949 the process owner must not only be aware and trained, but also must be competent. Competence is defined as “the ability to apply knowledge and skills to achieve the intended result”, and each individual business must define its competence relative to its context. As an example:

In a product safety environment, competency may include an awareness of the regulatory implications for the processes the process owners oversee, whereas in certain situations competence may simply be the understanding that they know the inputs that influence their potential outcome relating to risk (mentioned in Chapter 6), and how they interact with the processes that they serve as an internal supplier.

What is it?

• Competence is more than simply training a process owner, it is a deeper level of application of the technique to achieve the aim or output of the process
• An organization must define the competencies for the process owners within their system, and this level must be challenged to assure competency and not just a familiarization

How do I do it?

• Identify the process owners for your organization
• Identify the necessary competence for the process owners within your organizational context
• Define the training and other competency development actions that will be provided to the process owners
• Identify how you will validate the competency of the process owners (sample size, duration of evaluation, method of evaluation)
• Perform the competency evaluation at the defined period and document in a variable data-based way the assessment of the competency
• Retain the training log complete with competency evaluation as documented information

Tools and Techniques to achieve it

• As a simulation, insert a known issue into the owner’s process and determine if they can work within their process to sort out the issue and get to the right solution
• Establish testing criteria to test the strength of the relationship between the measurement and the process owner’s process (i.e. if this metric fails, does it really matter and does it behave as I expect?)
• Job descriptions with sign-off criteria clearly listed in variable data terms

Documents you can use to prove it

• Training documents
• Competency evaluation sign-offs
• Job descriptions with completed sign-off criteria filed as records – post evaluation

Questions to ensure you know it

• What do I need my process owners to be able to do?
• How could I prove that my training for a new process owner was effective?
• How do I challenge my process owners to make sure they understand the process, their process ownership responsibilities, and how the pieces interact?

How can you fail at it?

• Fail to assign process owners
• Assume a training certificate is acceptable to prove competency
• Fail to test the process owners for applied knowledge
• Fail to update what organizational role fulfills this need when the organization chart changes

In the old ISO/TS standard there used to be a role for the “Management Representative”. This used to be a position where an individual within the company held a role of a majority of all things QMS. In the IATF 16949 standard this position is eliminated and replaced with the list of responsibilities this individual used to have. These assignments must be documented and still cover the same items, but the IATF 16949 has opened up the role in order to assist companies of various sizes in achieving these functions. While there is a bulleted list, the flexibility created is extremely beneficial to an organization.

As an example, it used to be implied that the same individual was responsible for providing the voice of the customer when assigning special characteristics and setting Quality Objectives. This is usually done by two different individuals, and with the allowance to redistribute these responsibilities we can assign the selection of special characteristics to a member of management dealing with new program development and keep selection of Quality Objectives with an individual responsible for longer term strategic planning.

What is it?

• A set of roles and responsibilities that must be distributed and shared throughout the organizational structure
• These roles must be documented somewhere to protect the organizational knowledge
• The listed responsibilities may be added to, if deemed necessary, by an organization to meet the customer specific requirements

How do I do it?

• Identify the roles currently held in your organization
• Compare the list from the IATF 16949 standard to those roles currently in your organizational chart
• Adjust the current managerial roles as necessary
• It is advisable to select managerial roles closest to the process to maximize the value
• Provide training and competency evaluation for those modified job roles and log the evaluation in the training system for those job functions

Tools and Techniques to achieve it

• List of job descriptions
• Matching the list from IATF 16949 to the job descriptions

Documents you can use to prove it

• Job descriptions
• Training records showing competency to the roles listed within the managerial job descriptions

Questions to ensure you know it

• How to I address each item in the list…. who has that role within my organization?
• If I had to select special characteristics in a new program, which member of my team would I ask to be knowledgeable in being the voice of the customer?
• If I had to prove tomorrow that my team is covering all of the roles left by the vacancy of the Management Representative…what would I show?

How can you fail at it?

• Fail to address all of the areas called out in 5.3.1
• Fail to assure competency for the modified management roles
• Fail to give management the roles closest to the process

Responsibility without authority is a losing proposition, and it is key that individuals who have the authority (as defined in the roles and responsibilities for an organization) also have the authority to make changes and allocate resources. IATF 16949 goes beyond previous requirements in ensuring that those with responsibility for product conformance are empowered to stop the line, and those with the responsibility to take action are informed promptly and empowered similarly. Lastly, in operations running around the clock, make sure that someone within the organizational structure is made responsible for the conformity to product requirements. In most organizations that could be the quality group, however there is no requirement for who can be selected. In smaller organizations it is common for it to be product people to have this authority. Note again the flexibility of IATF 16949 to accommodate various sizes of organizations in their standard.

What is it?

• Responsibilities must be matched with the authority to take the action
• Those with responsibility must be able to stop the line
• Those with responsibility for corrective action must be notified so that containment can immediately begin
• Some organizational role at each shift must have responsibility for product conformance

How do I do it?

• Ensure each of the processes has an organizational role to be responsible for product conformity on each shift
• Ensure roles at the right levels are authorized to stop the line
• Provide training in corrective action and containment to those identified roles
• Establish criteria assuming the worst scenario on the off-shifts, and then assess competency against the criteria

Tools and Techniques to achieve it

• Job descriptions
• Organizational chart analysis

Documents you can use to prove it

• Organization Charts
• Job descriptions showing this authority
• Competency evaluations for those areas specified

Questions to ensure you know it

• If I went to a 3rd shift operation…who has the authority to stop the line when NC product is produced?
• Have we given authority to stop the line to the entity that we gave the responsibility to?
• How does word of corrective action opportunity get back to those that we ask to take action?
• How do we train those we ask to quarantine on how to quarantine and prevent shipment?

How can you fail at it?

• Fail to align roles and responsibilities with authority
• Fail to staff all shifts with some role responsible for conformity
• Fail to fill out the job descriptions for modified jobs
• Fail to train those that need to take corrective action and containment on how to do this
• Fail to assess the competency of these individuals to assure training is effective