To ensure supplier surprises are kept to a bare minimum, an organization cannot simply rely on thaumaturgy (go ahead and look it up). Supplier performance must be continuously gauged for effectiveness, and a feedback loop created to ensure suppliers are receiving accurate information in regards to their overall performance. Additionally, supplier performance metrics should be included into your management review process. Management must be informed of parlous issues that can result in the need for field actions or other interruptions of the supply chain.
Warning letter violation
In this installment of Devine Guidance, the warning letter (FDA no-no) points directly to a management review process, or in this case, clearly the lack of a management-review process. In fact, a member of the management team, mentioned in this warning letter, was not even aware of the requirement. Wait a minute folks: a manager working in the medical device industry not aware of FDA requirements? I am hoping that this individual was not a member of the quality or regulatory organization. Regardless, the entire organization should be trained to the Quality System Regulation (QSR) and their organization’s quality system. Remember, there is no excuse for a member of management not knowing the requirements.
8. Failure of management with executive responsibility to review the suitability of the quality system at defined intervals and with sufficient frequency according to established procedures to ensure the quality system satisfies the requirements of this part, as required by 21 CFR 820.20(c). For example, your firm failed to establish and implement written management review procedures. The only management official on site explained he was not aware of the requirements.
Regulations and requirements
The QSR and ISO 13485 are fairly prescriptive when it comes to defining the need, interval, effectiveness, purpose, and documentation of management review. There is not a specific requirement that states supplier metrics shall be included in the review; however, the management review process is the perfect forum to present and discuss supplier performance and supplier issues influencing organizational performance. Additionally, supplier corrective action should be treated as part of the corrective action system, and as such, belong in the management review.
1. QSR – Subpart B – Quality System Requirements
Section 820.20 Management Responsibility:
(c) Management review. Management with executive responsibility shall review the suitability and effectiveness of the quality system at defined intervals and with sufficient frequency according to established procedures to ensure that the quality system satisfies the requirements of this part and the manufacturer’s established quality policy and objectives. The dates and results of quality system reviews shall be documented.
2. MDD (please note the MDD references EN ISO 13485, the Harmonized Standard for Medical Device Quality Management Systems)
Article 3 – Essential Requirements:
The devices must meet the essential requirements set out in Annex I, which apply to them, taking account of the intended purpose of the devices concerned.
Where a relevant hazard exists, devices, which are also machinery within the meaning of Article 2(a) of Directive 2006/42/EC of the European Parliament and of the Council of 17 May 2006 on machinery shall also meet the essential health and safety requirements set out in Annex I to that Directive to the extent to which those essential health and safety requirements are more specific than the essential requirements set out in Annex I to this Directive.
Annex II.3 EC Declaration of Conformity – Full Quality Assurance System
The manufacturer must ensure application of the quality system approved for the design, manufacture and final inspection of the products concerned, as specified in Section 3 and is subject to audit as laid down in Section 3.3 and 4 and to Conformity surveillance as specified in Section 5.
3. EN ISO 13485 – 5.6 Management Review
Top management shall review the organization’s quality management system, at planned intervals, to ensure its continuing suitability, adequacy, and effectiveness. This review shall include assessing opportunities for improvement and the need for changes to the quality management system, including the quality policy and quality objectives. Records from management reviews shall be maintained.
5.6.2 Review Input:
The input to management review shall include information on:
a) results of audits,
b) customer feedback,
c) process performance and product conformity,
d) status of preventive and corrective actions,
e) follow-up actions from previous management reviews,
f) changes that could affect the quality management system,
g) recommendations for improvement, and
h) new or revised regulatory requirements.
5.6.3 Review Output:
The output from the management review shall include any decisions and actions related to:
a) improvements needed to maintain the effectiveness of the quality management system and its processes,
b) improvement of product related to customer requirements, and
c) resource needs.
Providing timely and objective feedback to the supplier is an integral part of any supplier management program. Timely feedback, especially related to potential product or performance issues, requires an immediate supplier notification to ensure mitigation of risks resulting from potential non-conformances.
According to Foxton, the employment of a four-step process, suitable for multiple environments, can assist in the facilitating of this feedback process. The four process phases are:
- Defining and sharing of the expectations;
- Employing recognized quality improvement techniques through the quality plans; and
- Pursing continuous quality improvements.
According to Slobodow, Abdullah and Babuschak, the communication between the buyer and the supplier in a typical buyer-supplier relationship is absent. Additionally, Slobodow et al. believed an open and honest relationship facilitated by good communication, between the buyer and the supplier is needed. Furthermore, Slobodow et al. stated, “dual accountability between a buyer and its strategic suppliers, through tools such as a Two-Way Scorecard, is a new and tangible approach to improving supply chain relationships.” Finally, the creation of a two-way scorecard is not sufficient without buy-in from senior management and cascaded down through the ranks of an organization.
One of the most important factors associated with an effective supplier quality system is the ability to communicate effectively with suppliers. According to Foxton, a report card is one of the tools needed in support of effectively managing a relationship between customers and suppliers. The issuance of quarterly performance reports and the expeditious issuance of supplier corrective action requests, as appropriate, ensure suppliers receive accurate measurement guidance that accurately reflects overall supplier performance. According to Trautman in an article published in The Street, medical device manufacturers “should keep a running tally of the supplier’s performance.”
So what does Dr. D have to say? If you read my previous installment of Devine Guidance, I am big on supplier corrective action and the employment of the Supplier Corrective Action Request, a.k.a., SCAR. Supplier non-conformances are a major component and significant gage for over all supplier performance; however, they are not the only one. Additionally, supplier yields, on-time delivery performance, responsiveness (timely response to requests), continuous improvement, value-added activities, total cost of ownership, etc. can be weaved into an all encompassing supplier report card; and yes, you must ensure the supplier actually receives a copy. Depending on your organizational structure, you can decide how often to issue these report cards. In a perfect world, the data would be available real time and on a daily basis; however, monthly would be outstanding, quarterly expected, and annually, well what is the point.
As for which suppliers receive a report card and the frequency, the decision will be premised on your organizational need and the applicable organizational procedure(s). And yes, before I forget, this activity must be documented in writing (Devine Guidance Rule # 3 – Document the results of all events in writing, because if it is not documented in writing, the event did not occur).
Conclusion: timely and accurate feedback
My message this week is a relatively basic but important one. Suppliers need to know how they are performing in regards to the good, the bad, and the ugly – and yes, I stole it from an old movie. Additionally, it is in the best interest of your organization to provide timely and accurate feedback to your supplier base. Without a functioning feedback loop (preferable closed-loop), you cannot hold the supplier accountable for not pursuing a proactive approach to resolving problems.
Remember, most suppliers are not clairvoyant. Furthermore, communication is a two-way street. It is mission critical, for the success of any organization, regardless of industry, to maintain open and honest lines of communication with their suppliers and their customers. Just ask Toyota. Finally, if your suppliers are performing at a high level, reward them. A lunch and a plaque recognizing their performance and achievements go a long way.
In closing, I want to thank everyone for joining me and tolerating my ramblings. I hope the guidance provided continues to remain informative and “Devine.” Until the next installment, when I discuss the value of supplier maintenance assessments, cheers from Dr. D. and best wishes for continued professional success.
Code of Federal Regulation. (2008, April). Title 21 Part 820: Quality system regulation. Washington, D.C.: U. S. Government Printing Office.
Devine. C. (2009, July). Exploring the effectiveness of defensive-receiving inspection for medical device manufacturers: a mixed method study. Published doctoral dissertation. Northcentral University. Prescott Valley, AZ.
FDA – U.S. Food and Drug Administration Website. (2010). Warning letters. Retrieved February 12, 2010, from http://www.fda.gov/ICECI/EnforcementActions/WarningLetters/
Foxton, J. (1996). Negotiating quality through customer communications. Managing Service Quality, 6(5). Retrieved November 5, 2008, from http://proquest.umi.com
Medical Device Directive. (1993). Council Directive 93/42/EEC. Medical Device Safety Service. Retrieved January 11, 2010, from http://directive93-42-eec.htm
Medical devices – quality management systems – requirements for regulatory purposes. (2007). EN ISO 13485:2003/AC:2007.
Poor supplier control causing recalls, FDA says; contract is key to success. (2007, May). The Sheet – Medical Device Quality Control, 11(6). Danvers, MA.
Slobodow, B., Abdullah, O., & Babuschak, C. (2008). When supplier partnerships aren’t. MIT Sloan Management Review, 49(2).