Today I have a guest blogger, Dr. Tim Rodgers, who asks the question: “Does Anyone in China Pay Attention to Standards?”
Over the past several years there’s been a growing number of high-profile incidents involving quality problems with Chinese suppliers and contract manufacturers. Earlier this year the venerable British car company Aston Martin announced a recall of 75% of the cars built since 2008 after discovering a Chinese supplier used fake materials in an accelerator pedal that was implicated in field failures. Incidents like this have plagued both small businesses with limited staffs as well as large multinational corporations with strong reputations and extended supplier management teams. Many companies are shifting production away from China to locations with higher labor cost in order to get better control over quality.
As someone who has lived and worked in China at a leading electronics manufacturing service for almost two years, I know from experience how hard it can be to maintain quality standards in that part of the world. I’m not convinced that this problem is unique to China, but it may seem worse because of the sheer number of suppliers competing on price with extremely small profit margins and very little loyalty on either side of the purchasing relationship. In this Darwinian setting, suppliers will look for any way to reduce their costs, and unfortunately that means some will violate standards, substitute materials, and skip testing or inspection.
Some people will look at this seemingly lawless environment and ask whether anyone cares about standards, and whether they should even bother communicating standards to their suppliers. If no one’s paying attention, what’s the point?
Do we still need standards? Of course we do. Let’s not confuse supplier performance problems with the value of setting clear expectations. Standards still provide a clear and unambiguous way to specify product requirements, testing procedures, and acceptance criteria. Regulatory agencies and review committees made up of your industry’s leading experts create standards that give you a proven, technically-sound basis for assuring reliable and safe products. They specify not just the quality characteristics of the supplier’s output, but in many cases also how that output should be produced.
Standards tell the supplier how you will measure their performance, and establish the criteria you will use to accept or reject their deliverables. Your supplier should already be familiar with your industry’s standards, and if they’re not, then they’re probably not the right supplier for you.
However, simply communicating the standard to your supplier is not enough to assure compliance. Purchasing customers have a responsibility here as well. You need to “trust but verify,” and regularly audit suppliers, which can include sampling incoming parts and inspecting the production factory and supporting processes. Suppliers need to understand that there are consequences for failures to meet standards, such as financial penalties and loss of business, and suppliers need to know that you’re monitoring their performance.
Yes, it’s frustrating when you discover a quality problem that can be traced to your supply chain, but that shouldn’t lead you to abandon standards. It can sometimes seem like the Wild West where anything goes, but without standards that clearly define your requirements and expectations you’re just contributing to the chaos.
Author: Dr. Tim Rodgers
Editor’s Note:
Tim Rodgers, Ph.D., MBA, SSBB, PMP, is a senior engineering manager with many years of experience leading new product development, supply chain management, and quality engineering teams at large multinational firms, including Lockheed-Martin, Hewlett-Packard, and Eastman Kodak. Tim is currently in-transition, looking for an opportunity to join a growing firm with an entrepreneurial culture. He writes regularly on management and quality issues at his own blog “Managing in the 2000s” at http://timrodgers.wordpress.com
