For consumers, product purchase verification is simple. It means opening a package or trying a product to see that what you paid for is what you get. For businesses, the process is much different. Product purchase verification is actually serious business that requires full-time professionals with engineering degrees. The concept is important to consider both for compliance and professional reasons.
The most important component of purchased product verification is actually certifying that the product was delivered. Even a medium sized company has many good coming and going across different warehouses and locations. It is impossible for one person to physically verify every delivery. For that reason, logging every delivery in an accounting or compliance system is crucial. After the delivery is logged, it can be tracked and utilized for production or distribution. Product purchase verification also sets off the accounts payable timeline.
The next most important factor is that the product delivered meets the quality standard expected. Products that have a chemical composition such as LNG, diesel or heating oil require an engineer or chemist to verify that the product is correct. They then log the information into a software or compliance management solution to confirm the quality information.
Lastly, product purchase verification is crucial for safety. The delivered product should be stored and contained in a package that prevents it from harming workers. Additionally, it should not be placed next to any other material that could produce a strong combustible reaction. Again, professional engineers or compliance professionals must work on this process to assure nobody is injured. They log information into an online system and carefully monitor the placement of all products.
Accupoint Software is a leading provider of compliance management tools for the petroleum industry. For more information on solutions to manage purchased product verification, please contact us today.
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Petroleum products and supply chains possess the potential for failure at every stage of development. When new products are being launched, mitigation of these mishaps depends on quality protection control flows already in place. In this post we examine the Advanced Product Quality Planning (APQP) method for creating a structured process for ensuring customer satisfaction and better products.
Customer Needs Come First
Consultants commonly use customer stats and profiling techniques to determine how their needs translate into product characteristics/requirements, and before APQP can be implemented, these needs are identification goal #1. With a new focus on sustainability and industry wide collaboration, customer specifications will steer the product development process clear of too much indecision and mistakes along the supply chain path. Don't hesitate to use customer feedback and validation to complete design reviews as well.
These methods have been around for decades, under the name advanced quality planning (AQP). This process can enhance product planning efforts, making the primary goal of product quality planning collaboration and communication between different engineering teams. This interaction will rely on a Cross Functional Team (CFT) planning that combines marketing, procurement, product review, manufacturing and distribution expertise to create a quality product.
Design within process capabilities. The first several sections of APQP mandate intense planning and prevention objectives, making up 80% of the APQP process. It is in this way that the APQP process supports the never ending pursuit of consistent improvement. The fourth and fifth parts, support the remaining 20% of APQP and focus on validation and evidence.
One of the key advantages of APQP is identification of change early on the in process and avoidance of late changes. Design reviews are formal reviews conducted during the development of a product to assure that the needs, concepts, and product process satisfies the requirements of that stage of development.
For more information on how Accupoint can improve your product quality planning process, contact us today.
Contract management and review are important, and often neglected disciplines. According to research done by the independent International Association for Contract & Commercial Management, good contract management practices could improve profit by 9% of annual revenue. Contracts can leak, costing money through outdated pricing, or misunderstandings and breakdowns in communication that lead to losses.
Contract review is the process for determining customer requirements prior to the supply of a product, and proof that the organization has the ability to meet the defined requirements. Contract review should be part of your company's business management. Attention must be paid to the requirements related to products, supply and management of information. Your company will determine the specific needs of the customer including delivery and post-delivery activities, such as warranty and maintenance services. You also need to consider requirements that are not explicitly stated by the customer, but are still necessary. You need to know any regulatory requirements that apply to the product.
Before your company commits to a contact or order, or any changes to existing contracts you need to consider several factors including:
Communication is also critical to success. You will need to determine effective means of communication in relation to product information, contracts, order handling, feedback and complaints. This is all part of your customer relations management processes and determining customer requirements. If contract review is ever done offsite, you need to link the activities to your on-site quality management system.
You must conduct risk analysis before committing to a contract. Consider whether taking on additional obligations will affect your supply chain, for example. Manufacturing risk analysis will help you assess your ability to effectively provide the specified product. Do you have the resources needed to fulfill the obligations? Can you meet timing demands? Are there additional developments costs and investments? Look at potential failures in processes, including suppliers. Is there solid potential for increased profits? Considering all of these factors will allow you to enter into contracts that are efficient and effective, which is good for your bottom line.
For more information on how Accupoint can help improve your contact review process, contact us today.
Securing materials and equipment is the first step in the supply chain. A company's competitiveness is directly influenced by the performance of suppliers. A supplier that does not perform well can add costs, cause serious delays and can damage your company's reputation. It is imperative to have a system to evaluate your suppliers. It will help you determine potential problems like low standards of quality, poor communication, and substandard resources. Every company needs to have a supplier evaluation model in place to measure a supplier's ability to comply with their contractual obligations.
Supplier evaluation will identify their strengths and weaknesses. Several criteria should be considered including quality, delivery, service, and flexibility. Generally, the most important factor is quality followed by delivery, service and then flexibility. An effective means of evaluating suppliers is assigning them to one of four categories based on performance: full partner, associate partner, high risk and incapable. A full partner meets or exceeds all expectations. An associate partner needs some work, but performs well overall. A high risk supplier must be carefully evaluated. They can be used for the production currently underway, but future contracts require consideration. An incapable supplier will be dropped as soon as possible as they cannot properly fulfill their obligations.
A full partner must be compatible with you company’s current and future business plan. They will always demonstrate high quality, on-time delivery, superior service and flexibility. The supplier participates in your automatic ordering system. They will provide full support quickly, and be available anytime for questions. A full partner should also assist with new designs and provide samples within one to two weeks. They will demonstrate an ability to develop new processes and be committed to research and development. They will not ship out-of-spec parts, and have well documented quality controls. They will optimize lead times and allow order flexibility within reason. They will show commitment to cost reductions and share their cost structures and pricing models.
An associate partner will meet most of the criteria of a full partner. The associate partner should demonstrate a commitment to improving quality and delivery. You can work with them to develop action plans to meet your goals. The supplier must fulfill the needs of your company. They should be willing to work toward meeting the criteria to become a full partner.
High Risk Partner
A high risk partner is not compatible with the goals of your company. Their current quality and delivery are acceptable to maintain current production, but there is no benefit in expending the resources to bring them to associate or full partner status. The cost and quality are below your company’s acceptable standards.
Incapable suppliers do not meet quality standards. They do not demonstrate the capability of improving quality, delivery, service or flexibility. These suppliers must be dropped immediately.
Evaluating the performance of suppliers using an Analytical Hierarchy Process (AHP) model helps to determine the importance of each criterion and interpret the findings. You will determine what is most important for your company, and use that to rate your suppliers. Supplier can be measured based on the four main criteria: quality, delivery, service and flexibility. To determine the rest of the criterion you should consider whether the attributes are “soft” criteria (like supplier commitment or service) or “hard” quantifiable criteria (like the supplier's ability to fulfill orders). When thinking about cost, consider that the total cost of a product includes all the factors that go into getting your product to market in addition to its initial procurement cost.
For further information on how Accupoint can help your critical supplier management process, contact us today.