q1 rules ref card

Q1 RULES REFERENCE CARD December 2014 Q1 RULES REFERENCE CARD

December 2014

CONTENTS Introduction

Q1 Eligibility

Q1 Requirements

Q1 Scoring • Q1 Scoring General Information • Capable Systems • On-going Performance • Q1 Manufacturing Site Assessment (Q1MSA)

Customer Endorsements

Q1 Achievement/Q1 Reinstatement

Q1 Application

Q1 Revocation

Q1 Status Code Diagram

Q1 Status Code Descriptions

Directed Tier 2 Responsibilities

Frequently Asked Questions

Updating Information/Contacts

Web Sites for Additional Information • Supplier Improvement Metrics (SIM) • Quality System and Supplier Documents

Introduction This document is intended to serve as an aid in the understanding of the Q1 Requirements and Q1 Scoring rules as applied in Supplier Improvement Metrics (SIM).

Q1 Eligibility • Non-manufacturing facilities are not eligible for Q1 status.

Examples of non-manufacturing facilities include, but are not limited to: warehouses, In-Line Vehicle Sequencing Centers (ILVS), P.O. Boxes, accounting offices, sales offices, prototype design facilities, repair facilities, rework shops, distributors and ship points.

• Manufacturing locations which cannot generate all Q1 metrics, including quality and delivery performance, are not eligible for Q1. Note: Q1 metrics managed outside of SIM and approved by STA Strategy may be used on an exception basis to represent the Q1 required performance metrics.

• Supplier Site must show at least one performance rating 6 months old (production and/or Service metrics) and have at least 3 months of metrics (delivery metrics may include the immature month).

• Lead STA Site Engineer: Production STA Site Engineer, unless the Supplier Site is Service unique or delegated by Production, then the Service STA is the Site Engineer.

• Supplier Sites must be STA active in GSDB/SIM with an assigned STA site engineer and STA Organization.

Q1 Requirements Capable Systems

Certifications and Assessments

On-going Performance metrics

PPM – Production and/or Service QR rate (for bulk material suppliers only, as appropriate)

Delivery – Production and/or Service

Field Service Actions

Stop Shipment(s)

Violation of Trust

Q1 Manufacturing Site Assessment


"The information contained herein is FORD PROPRIETARY information and may include FORD CONFIDENTIAL information as defined in Ford's Global Information Standard II. Reproduction of this document, disclosure of the information, and use for any purpose other than the conduct of business with Ford is expressly prohibited"

of 19

Page 2 of 19


December 2014

Q1 SCORING

Q1 Score includes: Capable Systems + On-going Performance + Q1 Manufacturing Site Assessment

Q1 Scoring General Information • Q1 Score baseline is 1000

• Scoring adjustments are based on: Capable Systems, On-going Performance and Q1 Manufacturing Site Assessment.

• Q1 score must be at least 800 points to maintain Q1. A Q1 Supplier Site with a score below 800 points will be recommended for Q1 Revocation.

• If a -250 point score occurs for any metric, positive points are not applied to any other metric.

• A Supplier Site that is either Production or Service STA active and missing corresponding PPM data or delivery data for the last 7 months will have the Incomplete Icon displayed next to impacted Site and Metric Q1 scores.

• An Incomplete Q1 score indicates that a normal metric expected for Q1 is not reported. It does not imply poor performance. The Site Engineer and supplier should understand the reason for any missing metric and take action if it is not expected.

• Q1 Scoring is updated every weekend based on the most current metrics available in SIM.

Capable Systems: (0, -100 or -250 points)

Current certification/assessment information is maintained in GSDB Online by suppliers. Satisfying all required certificates/assessments noted below results in 0 point adjustment. ISO 14001- Environmental Management System • 3rd Party Certificate – uses Expiry date from GSDB Online

• Blank Expiry date, expired over 31 days, blank or 'TBD' certificate number results in -250 point adjustment

• Expired between 7 and 31 days results in a -100 point adjustment ISO/TS 16949 - Supplier Quality System

• 3rd Party Certificate – uses Expiry date from GSDB Online

• Blank expiry date, expired over 31 days, blank or 'TBD' certificate number results in -250 point adjustment

Expired between 7 and 31 days results in a -100 point adjustment For Bulk Materials only: brokers may be certified to ISO 9001

Material Management System Requirements MMOG/LE - Global Materials Management Operations Guide/Logistics

Evaluation • Self Assessment – [annually between 1st May and 31st July] • Self Assessment: MMOG/LE Tier 1 suppliers are required to meet

requirements for Level A. Translated requirements are available through AIAG, http://www.aiag.org or through Odette http://www.odette.org. • Lack of a valid supplier MMOG/LE Self-Assessment meeting

Level A may result in a loss of MP&L Endorsement. • Q1 Scoring

o Valid Supplier Self Assessment must be entered into GSDB or GSDB Online with the level and assessment date identified. A blank level (MMOG/LE) or a TBD date is not acceptable.

o A Supplier Site is not required to submit a Self Assessment directly to MP&L unless requested.

o A blank Self-Assessment in GSDB, Failure to achieve Level A, or failure to update the assessment by the end of the annual

update period results in -250 points.

On-going Performance: Scoring Thresholds Q1 uses key metrics of quality performance in determining a supplier's Q1 Score:

• Overall Site PPM

• PPM Commodity Performance - Production and /or Service

• Delivery Performance - Production and/or Service

• Field Service Actions

• Stop Shipment(s)

• Violation of Trust

Page 4 of 19 Page 3 of 19


December 2014

Overall Site PPM - Production and/or Service (0 to +100 Points) • The 6 mature months of receipts/rejects are used for PPM.

• Production and service points are calculated separately

• Site PPM does not result in negative points for either Production or Service

• Positive points are not allowed if the Supplier Site has fewer than 2 months of production receipts in the last 6 mature months for either Production or Service.

• The Supplier Site does not qualify for Q1 if it has fewer than 3 months of receipts for production and / or service.

6 Month Overall Site PPM Adjustments: (Determined separately for Production and Service)

PPM Score Points 0 PPM +100 points

1 PPM to 60 PPM +50 points

61 PPM and above 0 points

PPM Low Commodity Comparison – Production and/or Service (+100 to -250 points) PPM Commodity General Rules:

• Score and Commodity determined separately for Production and Service, based on data from the last 6 mature calendar months.

• Each Commodity is scored, with the lowest scoring commodity chosen to determine the site commodity score.

• Industry is defined as all external supplier shipments (reported in SIM) of part numbers with the same Low Commodity Code.

• Industry Commodity PPM level is updated annually in March based on the prior 12 months Industry PPM for each Low Commodity for both Production and Service.

• No positive points are allowed if the Supplier Site has fewer than 2 months of production/service receipts in the last 6 mature months.

• The lowest possible score for a commodity may be limited and phased in based on several metrics including Site and Commodity PPM, receipt % of site volume and total rejected parts.

PPM Low Commodity Scoring Rules • BASE Score: A Supplier’s score in each commodity is initially

determined from the commodity scoring table based on the performance vs. the Q1 industry commodity PPM level for the lowest scoring commodity. The result of this is shown as the Base Score.

• Applied Score (on commodity detail): The Base score may be adjusted due to phase in limits or other scoring limits and is reported as the Applied Score. (See Phase in table on next page)

• Q1 Scoring Detail Page Base and Applied Score: The Base Score shown on the Q1 Scoring Detail page is from the lowest scoring commodity. The Applied Score is the Base Score modified by the adjustments caused (limited) by other site metrics.

• How to determine -150 vs. -250 point penalty: When a site commodity PPM exceeds 2 times its Q1 Industry commodity PPM it is evaluated for a -250 penalty based on the count of individual months of the site commodity PPM exceeding twice its Q1 Industry Commodity PPM and scored as shown below:

6-Month PPM Low Commodity Q1 Base Score:

Performance vs. Industry Commodity PPM

Points

100% +100 points 75% to 99% +75 points

50% to 74% +50 points

25% to 49% +20 points

11% to 24% +10 points

0% to 10% 0 points

-1% to -24% -25 points

-25% to -49% -50 points

-50% to -74% -100 points

-75% to -99% -125 points

> -100% See Below

-250 Point criteria – Count of months within the 6 mature months that exceed 2x Q1 Industry Commodity PPM

Level:

Fewer than 3 months -150

3 months or more -250

Page 5 of 19


December 2014

Commodity PPM phase in Applied Score limit table. These scores are used to limit the negative commodity PPM score on each commodity if the range applies and if the associated Lowest Score Allowed is higher than the Base Score calculated for the commodity. The Applied Q1 Score is the highest score value comparing the Q1 Base Score with all the applicable Lowest Scores Allowed. Limits are only applied to the Q1 Base Score if the “Phase In Metric” value for the commodity / site are within the stated ranges. If no limit is applicable, the Applied Q1 Score is the same as the Base Q1 Score If the “Lowest Score Allowed” indicates “not used for Q1”, that commodity will not be used to determine the site Q1 score.

Delivery Rating – Production and/or Service (+100 to -250 Points)

Delivery Rating General Rules

• Determined separately for Production and Service

• Requires at least two months of delivery ratings to gain points

• Delivery ratings are issued to Ship Points

• A unique ship point is determined by ship point GSDB code

• Production Sites uniquely supplying bulk material, "As Required" parts/product may be exempt from Delivery requirements including MMOG/LE IF they are marked as waived in SIM by an MP&L analyst.

Delivery Ratings Considered in Q1

• All delivery ratings assigned directly to a manufacturing Supplier Site are considered (where Mfg Site code = ship point Site code)

• Delivery ratings for ship points associated with a manufacturing Supplier Site are only considered when receipts exist through the ship point within the last 7 months (including the immature month).

• When no receipts exist in the last 7 months, the message "Not used in Q1 score, zero receipts in last 7 months" will appear by these ratings.

Determining Worst Ship Point

• For all considered ship points (and the directly shipping manufacturing site as appropriate), the Supplier Site receives a -250 point adjustment if the 6 month weighted average AND the last three available delivery ratings within the last 7 calendar months all fall below 81.

• If no ship point meets the -250 point adjustment criteria above, then the ship point with the worst 6 month weighted average is used to determine the Q1 points based on the following scoring table:

Delivery Adjustments where no ship point meets the -250 point adjustment criteria:

6 Month Weighted Average Points 100 +100 points

97 to 99 +50 points Below 96 0 points


Page 8 of 19


December 2014

Warranty Spikes (No Longer Scored for Q1) Warranty Spikes are no longer scored in Q1, and are not reported to SIM. Placeholders in SIM may be visible but no score is generated.

Field Service Actions (0 or -250 Points) Field Service Actions impacting Q1 are those actions approved by Ford, with any supplier responsibility, which involve notification of dealers and/or vehicle owners, regarding inspection and/or correction of a potential production vehicle concern. For questions relating to Fields Service Actions responsibility or Q1 implications, contact your Ford STA Site Engineer.

Field Service Actions Adjustments:

Field Service Actions Frequency Points 0 in 6 months 0 points

1 or more in 6 months -250 points

Date of the Field Service Action reflects the date the Field Service Action was approved. Field Service Action Waiver (Production Only) Q1 impact of a Field Service Action may be waived if the responsibility for the Field Service Action has been reassigned away from the Supplier Site, as agreed by a STA Regional Director. For additional information, please contact your Ford STA Site Engineer

Stop Shipment(s) (0, -100 or -250 Points) A Stop Shipment impacting Q1 is the containment of all affected vehicles with a potential production vehicle concern, with any supplier responsibility, already released by the plant but not yet in the hands of dealers or customers. Stop Shipment(s) Adjustments:

Stop Shipment(s) Waiver (Production Only) Q1 impact of a Stop Shipment may be waived if the supplier demonstrates proactive intervention; the suspect component has not been used in Ford production and has been replaced in a timely

manner with certified stock, as agreed by a STA Regional Director. For additional information, please contact your Ford STA Site Engineer.

Violation of Trust (0 to -250 Points) If Ford Supplier Technical Assistance (STA) determines that the supplier has committed a Violation of Trust, it will lose 250 points. One example of a Violation of Trust occurs when a Supplier Site fails to notify STA and obtain approval through the Supplier Request for Engineering Approval (SREA) process for supplier initiated:

• Manufacturing or equipment process change (including tooling)

• Component or material change or substitution

• Subcontractor or vendor change

Other examples of Violation of Trust may include:

• Launch ramp-up or rate of climb which adversely impacts plant build schedule versus the agreed timing

• Self-certified PSW is incomplete or inaccurate

• PSW supporting data lacks integrity

• Other trust issues which severely impact the On-going business relationship with Ford

• Supplier initiated Supplier Site location change without notifying Ford.

The STA Site Supervisor can register a Violation of Trust issue into the system by using the Maintain Site Management view in SIM. The Violation of Trust will remain in SIM until the STA Site Supervisor removes it.

Stop Shipment(s) Frequency Points 0 in 6 months 0 points 1 in 6 months -100 points

2 or more in 6 months -250 points



December 2014

Q1 Manufacturing Site Assessment: (0, -50, -150 or –250 pts)

Supplier Site must meet all Q1 manufacturing expectations or implement an acceptable and effective corrective action plan. The Supplier Site will use the latest assessment available on the Ford Supplier Portal (FSP) at https://web.qpr.ford.com/sta/Q1.html Many supplier performance aspects (such as launch performance, continuous improvement, etc.), not specifically scored in SIM, can affect the Q1 score through the Q1 Manufacturing Site Assessment (Web Based Q1MSA or Excel Spreadsheet Q1MSA Checklist)

Q1 Manufacturing Site Assessment (Q1MSA) For Production and/or Service):

Site assessment frequency is based on Quality Segmentation:

• Segment I and II and Unsegmented Supplier Sites every 6

months

• Segment III and IV Sites every 12 months

The STA Site Engineer enters the status of the Q1 Manufacturing Site Assessment in eQ1MSA. Note: Q1 Manufacturing Site Assessment frequency for service unique Supplier Sites is typically every 12 months.

Scoring Impact on Q1: Two-Step scoring Process is based on the status of the Q1 Manufacturing Site Assessment or of the Q1 Manufacturing Site Assessment Action Plan (if required).

Last Q1 Manufacturing Site Assessment Scoring:

• Assessment performed and acceptable (0 points)

• Assessment is late within the most recent 6 month period to the required 6 or 12 month frequency

o Overdue – automatic point deduction (-50 points) o Delinquent, First Action (-150 points) o Delinquent, Second Action (-250 points)

• Corrective Action Plan (CAP) Required: scoring based on CAP status as follows:

o Overdue – automatic point deduction (-50 points) o Submitted and acceptable (0 points) o Delinquent, First Action (-150 points) o Delinquent, Second Action (-250 points) o Ineffective, First Action (-150 points)

o Ineffective, Second Action (-250 points)

Customer Endorsements Each Supplier Site must obtain customer endorsements demonstrating

it consistently meets the needs of its Ford customers.

• Once the Supplier Site has satisfied Q1 Requirements (Capable Systems, On-going Performance and Q1MSA), the Supplier Site will obtain customer endorsements from:

• STA Site Engineer

• Plant: Plant Mgr or designee for each Ford Plant

• FCSD (for Service Parts): FCSD Quality Mgr or designee

• MP&L: Delivery Performance Supervisor or designee Note: where FCSD and MP&L endorsements include parts from the supplier impacting multiple geographic regions, ensure that all affected regions provide their input into the endorsement

• Customer endorsements are valid for 6 months from date of issue

• Customer endorsement is based on a Supplier Site's performance during the prior six months on the following Q1 criteria, as appropriate:

o All Q1 Requirements (endorsements require at least 3 months of receipts during the most recent 6 mature months)

o For Ford plants only: Six month QR trend shows improvement or flat trend.

• Removal of endorsement alone will not impact Q1 score.

• Only those customers impacted by issues leading to a Q1 Revocation need to renew endorsements for Q1 Reinstatement.

Q1 Achievement / Q1 Reinstatement Requirements Supplier Site must show at least 6 months of performance history after the Q1 Revocation date, and must meet all Q1 Requirements as listed below:

Capable Systems

0 points in SIM, showing the Supplier Site has all required certifications to ISO/TS 16949, ISO 14001 and self-assessment to MMOG/LE at level A.

For Raw Material brokers ISO 9001 certification may be acceptable.

PPM – Production and/or Service

No adjusted PPM commodity score of -50 or worse.

Raw Materials suppliers: 6% QR rate or less.



December 2014

Delivery Performance – Production and/or Service

• 3 most recent available delivery ratings in the last 7 calendar months and 6 month weighted average all 81 points or higher

Receipts – Production and/or Service

• Receipts are required for at least 3 of the most recent 6 mature months to be eligible for Q1 application

Warranty Spikes

Not applicable to Q1 achievement or Reinstatement


0 in most recent 6 months with any supplier responsibility

Stop Shipment(s)

0 in most recent 6 months with any supplier responsibility

Violation of Trust

No trust issue which severely impacts the On-going Ford supplier business relationship.


As outlined in the Customer Endorsements section.

Q1 Manufacturing Site Assessment (Q1MSA)

Acceptable last Q1 Manufacturing Site Assessment, or acceptable Corrective Action Plan, which has been entered into eQ1MSA.

Q1 Application • STA Site Engineer reviews the Supplier Site data for conformance

with the Q1 Requirements as stated above and ensures all endorsements are obtained, are not expired and are in SIM.

• If the Supplier Site meets all Q1 Requirements the Q1 status is updated in SIM and the Supplier Site is notified with a Q1 Letter bearing the required STA and Purchasing signatures.

• The Q1 Plaque and Flag are ordered and the STA engineer delivers them to the Supplier Site as appropriate.

Q1 Revocation Supplier Site has violated any one of the Q1 Requirements: Capable Systems, On-going Performance or Q1 Manufacturing Site Assessment.

Q1 Revocation Thresholds (any occurrence results in -250 points)

Capable Systems

Certificate expired more than 31 days (including no date), blank or 'TBD' certificate number

PPM – Production and/or Service

Low Commodity PPM– Site's worst scoring PPM exceeds 200% of the corresponding Industry Commodity PPM for the combined 6 mature months and 3 or more of the individual 6 months in the Q1 scoring window resulting in an Applied PPM score of -250.

Delivery: Production and/or Service

Delivery rating falls below 81 points for:

• The weighted six-month average AND

• The last 3 available ratings from the most recent 7 calendar months


One (1) or more field service actions in the most recent 6 months with any supplier responsibility.

Stop Shipment(s)

Two (2) or more stop shipment(s) in the most recent 6 months with any supplier responsibility.

Violation of Trust

A trust issue which severely impacts the On-going Ford supplier business relationship.

Q1 Manufacturing Site Assessment (Second Step -250 points)

A delinquent Q1MSA, Delinquent Action Plan or Ineffective Action Plan



December 2014

Q1 STATUS CODE DIAGRAM

Q1 Code Descriptions • "D" Disposition Required – New Supplier Site requires a Q1

Manufacturing Site Assessment

• "A" Working Toward Q1 – Supplier Site is expected to achieve Q1 within 12 months of Production Established (PE) Date

• "W" Q1 Waived – Supplier Site must meet Q1 On-going Performance requirements but it may use an alternate quality system to satisfy the Q1 Manufacturing Site Assessment (Q1MSA) expectations and capable systems requirements

• "X" Q1 Approval Denied – Supplier Site does not meet Q1 Requirements or non-Q1 Site does not meet the on-going performance requirements of Q1.

• "Y" Q1 Achieved – Supplier Site has been awarded Q1

• "R" Q1 Revoked – Supplier Site has lost Q1 due to performance or customer satisfaction issue

• "N" and "U" are codes only used in N.A. Bulk/Raw Materials brokers (Not eligible for Q1 and Unacceptable respectively)

• "Z" Non-Manufacturing Supplier Site – e.g. warehouse, sequencers, sales office, technical center, P.O. Box. Temporary indicator flag to identify Supplier Site needs to be resourced.

• "2" Tier 2 – STA supported Supplier Site with no products shipped directly to any Ford facilities. Triangular Sourced Directed Tier 2 with Multi-Party Agreement identifying STA responsibilities.

• “V” Virtual Site – Identifies Virtual contract manufacturing sites manufacturing product on behalf of another parent. These sites may represent a second GSDB site code at the supplier site, each site code of a different supplier parent and associated quality responsibility. The virtual site may be sourced as a responsible manufacturing location.

Directed Tier 2 Responsibilities Only if there is a Multi-Party Agreement in place between the Tier 1, Tier 2 and Ford is there any assigned responsibility for STA in managing the Tier 2. For all other types of directed Tier 2 (Straight and Basket), the Tier 1 has full responsibility for the product from the directed Tier 2.

Frequently Asked Questions Correcting Data Issues I see a production part number in SIM with an incorrect Low Commodity Code or showing up under the wrong manufacturing site code. How do I get it changed? The Buyer and potentially PD engineer must update the commodity code in WERS and WIPS to reflect the correct low commodity code, etc. for the subject part number. I see a supplier in SIM sourced to the wrong manufacturing site code. How do I get it changed? The Buyer must update the site code in the Purchase Order in WIPS to reflect the correct site etc. for the subject part number.



December 2014

I see an "Incomplete" Q1 Score in SIM. What causes this and how do I resolve it?

Incomplete Q1 scores are informational indicators to show that a site has one of two conditions:

• A Production STA Engineer is assigned but the site is missing Production PPM or Delivery data

• A Service STA Engineer is assigned but the site is missing Service PPM or Delivery data

The reason for the indicator is awareness of the lack of data. There is frequently nothing that can be done because the supplier data is not available to SIM (such as service shipments directly to dealers), and the condition does not impact the supplier’s eligibility for Q1

Updating Information/Contacts What Where Who

General questions about SIM

SIM [email protected]

Capable Systems GSDB Online Suppliers

Corporate Security Administrator Update

Covisint Help Desk

Supplier CSA

https://fsp.portal.covisint.com/web/portal/home Covisint

Delivery Champion name, phone, fax email

GSDB Online or CMMS

Supplier Ford Delivery Analyst displayed in SIM

Delivery Dispute Super G [email protected]

FSP Access Issues Covisint Help

Desk

Supplier.

https://fsp.portal.covisint.com/web/portal/home

Q1 Manufacturing Site Assessment

eQ1MSA or SIM Supplier or STA Site Engineer

Plant Manager name, phone, fax, email

GSDB Online or STA Engineer

Supplier through GSDB online STA Site Engineer, POC

PPM Production Dispute QR2, CMMS Ford Plant IQ

and/or STA Resident

PPM Service Dispute

Covisint, Applications,

“FCSD Supplier Quality

Discrepancy Notice Site”

Service STA Site Engineer as listed in SIM

Note: must complete 3D before disputing.

QC Manager name, phone, fax, email

GSDB Online or STA Site Engineer

Supplier through GSDB online STA Site Engineer, POC

SIM Access Issues Covisint Help

Desk https://fsp.portal.covisint.com/w

eb/portal/home

Supplier Site Name GSDB Online

GSDB Supplier → [email protected] →

Buyer



December 2014

Web Sites for Additional Information

Supplier Information Metrics (SIM) Supplier: https://fsp.covisint.com

The following information is available

Weekly Updates

• Parent Report Card (management reports)

• Manufacturing Site Performance Metrics

• Q1 Score Daily Updates

• QR Detail

• Site Certifications and Q1 MSA status on the Site Status and Profile page.

External through Ford Supplier Portal Quality System and Supplier Site Documents - Q1 • https://web.qpr.ford.com/sta/

• Q1 Summary showing Q1 Requirements

• Q1 Manufacturing Site Assessment – Checklist

• Web Based Q1 Manufacturing Site Assessment

• Q1 Rules Reference Card

• ISO/TS 16949 Information

• GSDB On-line Information

Change Log Complete rewrite November 2013 Updated PPM Phase in table December 2014

Page 19 of 19