Application of Statistical Process Control for the Assessment of Supplier Performance and Process Capability in an Automotive Manufacturing Company
Authors: Thambirajah John J 
Published: September 2023

One of the most important attributes to manufacturing is product quality. It relates to the historical rejection rate during a period of time of the products delivered to the customer. Rejection is due to deviations from specifications in the raw material supplied by suppliers, process design, and the quality control of the manufacturing process. The non-conforming parts can be detected during incoming inspection or during work in process. With regards to this, the standardization and maintenance of process equipment are of prime importance in ensuring the quality of a process and the products that are derived. Cost is another important attribute of the product as it affects the bottom-line. In this regard the competence of the supplier of raw material to design, develop and launch products within specifications becomes imperative in a manufacturing process. In the current competitive environment, it is crucial to assess suppliers as good quality raw material are important in the development stage, as this can have an adverse effect on the customers response. Supplier flexibility involves the response time when engineering changes are needed during the development stage. As a result, research and development activities are used to initiate and measure the ability of the supplier to provide support during the process. It is an important attribute as most products, after launching, demand continuous improvement to remain competitive. Procurement of materials and equipment is considered the first step in supply chain management of many companies. It is also broadly known that the performance of suppliers directly influences the company’s efficiency and competitiveness. Supplier performance evaluation is a crucial process to identify strengths and weaknesses of suppliers which can help the company to manage them. There are various supplier performance evaluation methods. In this study process quality of the existing system of producing steel shafts for an automotive industry was first evaluated and based on this study the machine was recommended for upgrading by engineering design. This was due to the process capability analysis of the machine, which did not meet the stipulated standard of 1.3 for the machine’s capability index. Although, the raw material supplied by the suppliers were within the measured confidence interval, the summary reports did not meet the required standards. In order to develop a performance evaluation system of the suppliers of raw material to the company, four main-criteria, may be developed, namely: quality, delivery, service, and flexibility. Statistical analytical studies performed during the process on five selected suppliers of raw material showed that the most important criteria of the process metrics was machine performance, followed by quality of suppliers in terms of the supply of raw material. Based on this study, the relationship between the quality of the supplier, the performance of the machine and the specification to the consumer may be assessed.