Quality Progress - March 2013 - 8

exPerTAnSWe Information collection cations and purchase order requirements). pliers also may deny access to documents You can expect suppliers to be unwill- that they believe contain their intellectual lead auditors not allowed to request from a ing to provide sensitive information prior property, trade secrets or key competitive supplier during a supplier audit? to engaging in an official contract, or in information. Q: What information and documents are Mario Tripari some cases, even after signing the contract. Alpharetta, GA Questions that may go unanswered include: of your purpose, you may wish to use a Who are your top customers? What per- supplier pre-audit survey or questionnaire, A: While there is no rule or requirement centage of revenue is attributed to these rather than asking during the audit, especially that prevents an auditor from requesting top customers? What is your gross margin? if you have concerns that your supplier will certain information from a supplier, it is What is your net profit? challenge the relevance. There are details not part of auditing protocol to ask ques- You may be able to research some of For information that falls within the scope you as a customer would genuinely want to tions that are irrelevant to the purpose these answers for publicly listed compa- know, such as the supplier’s strategic long- and scope of the audit, and the purchasing nies. Privately held companies may not be term plan for three to five years, a technol- requirements1 (such as contracts, specifi- inclined to disclose such information. Sup- ogy roadmap, key suppliers, total inventory of raw materials and overall financial health. Questions to ask during an audit / TAble 1 Examples outside accepted protocol This information is required to assess potential collaboration, and opportunities and risks to business continuity. The supplier might Primary question Secondary questions What information do you want from your supplier? Is this within the scope of your contract/service level agreements with your supplier? What you should not ask: to share; however, with your management’s support, you should be able to negotiate ac- If none exists, is this within the scope of the business you conduct with your supplier? expected closing revenue, profits for the quarter. Your competitor’s information, such as orders placed and contact name. Is it legal to provide and receive this information in the countries where your business and the supplier’s business are located? perceive this information to be too sensitive cess to the facts you need. Detailed audit planning—coupled with pre-audit meetings with suppliers—should Supplier staff personal information. surface any controversial areas ahead of Attorney-client privileged information. time. For example, consider a supplier audit in which your main focus is to cover a pro- If no legal issues exist, are there any potential ethical issues in asking for this information? Is the information tradesensitive or proprietary? Process recipe or trade secrets. Does the information provide verification of conformance? Why you should not ask: Will it help assess future risks or opportunities in the business? Why do you need this information? Supplier internal systems access information, such as log in and password. Personal curiosity. diting process recipe controls, but the sup- Collect “just in case.” plier may not want to show them to you. You no specific reason. will have to decide if this is a deal breaker. Will it provide evidence for writing non conformances? cess that happens to be proprietary. There will be no point in visiting the supplier until you have worked out all of the details around the extent of your access. For instance, you may be interested in au- Instead of arm-twisting the supplier to show 8 Will you include it in audit reporting? How you should not use information collected: the recipe, would you be willing to audit Will it enhance business/ technical collaboration with the supplier? To negotiate with another supplier. corresponding controls to make an educated To benchmark for competitive advantage (without supplier’s knowledge or permission). assessment of the supplier’s overall docu- To renegotiate with the supplier in an attempt to cut costs. How do you intend to use the information? that you see the controls exercised in their QP • www.qualityprogress.com several other non-sensitive documents and ment and records control? Or is it essential process recipe? http://www.qualityprogress.com

Table of Contents for the Digital Edition of Quality Progress - March 2013

Up Front
LogOn
Expert Answers
Keeping Current
Mr. Pareto Head
The Right Ingredients
Before the Fact
Apples to Oranges?
Five at the Forefront
Innovation Imperative
Measure for Measure
Quality in the First Person
Career Corner
Statistics Roundtable
Standards Outlook
QP Toolbox
QP Reviews
One Good Idea

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