ISO 9001-Clause 7.4 Purchasing
ISO 9001-Clause 7.4.1 Purchasing process
ISO 9001 Requirement
The organization shall ensure that purchased product conforms to specified purchase requirements. The type and extent of control applied to the supplier and the purchased product shall be dependent upon the effect of the purchased product on subsequent product realization or the final product.The organization shall evaluate and select suppliers based on their ability to supply product in accordance with the organization’s requirements. Criteria for selection, evaluation and re-evaluation shall be established. Records of the results of evaluations and any necessary actions arising from the evaluation shall be maintained (see 4.2.4).
Clause 7.4 covers the requirements to control purchased product, requirements to control suppliers you buy from, and requirements to control your buying process. Purchased product includes raw materials, components, subassemblies, supplies, tooling, machinery and equipment, sequencing, sorting, rework, testing, calibration, maintenance, etc. Note that clause 7.4 requirements apply to items that go into the product, manufacture the product, check the product or deliver the product; whether paid for or customer provided.
These may include materials, production equipment, tooling, measuring and test equipment, facilities, transport vehicles, returnable packaging, intellectual property (drawings, specifications or proprietary information), product returned for servicing under warranty, product sent for outsourced work etc. You must have specifications/criteria for purchased product. These specifications may come from your organization, customer, regulatory bodies, supplier or industry. As documents, these specifications must be controlled as per clause 4.2.4. Many times the customer may require the use of pre-approved purchased products and suppliers. The onus is still on you to ensure that purchased product from customer-designated sources meets all requirements. You must control both, the product you buy, as well as the supplier you buy from. Your controls must primarily be based on prevention of nonconformities in both product and supplier performance.
Determine how important the purchased product is to design, manufacture, assemble and maintain your end product. If you recall from product design input (clause 7.3.2) we considered factors such as targets for product quality, life, reliability, durability, maintainability, and cost. You must apply similar criteria to purchased product going into your end product. Categorize your purchased products and services accordingly. Then determine what controls you need to ensure consistent purchased product quality and consistent supplier performance. You can then apply different controls for different purchased products. There are several ways to evaluate your suppliers. Besides product quality, your criteria for supplier selection and evaluation may include the potential supplier’s financial capability, technical and manufacturing capability and capacity, reliability, reputation, flexibility to handle changes, support, service, cost etc. The importance of these criteria will vary according to the items materials or services you purchase, and so you can apply different criteria to different suppliers. You can categorize your suppliers accordingly based on these criteria. It might be useful to maintain a list of all qualified suppliers. In addition to the initial evaluation and approval of suppliers, you are required to carry out ongoing monitoring and measurement of their performance. Use supplier monitoring indicators to evaluate the consistency, capability and reliability of their performance for quality, delivery, support, etc. On-time delivery is very important and disruptions (due to waiting for materials) at your customers or even your own facility must be avoided. Depending on the risks related to materials supplied and supplier performance, you might consider requiring some of your key suppliers to comply with some or all of ISO 9001 requirements and perhaps even certification. As per clause 4.1, you must identify your purchasing processes whether on site or off site. For each process, you must document the controls for purchased product and suppliers. You must also show the linkage and interaction of purchasing processes with other processes such as design, manufacturing, tooling maintenance, calibration. Where any of your controlled suppliers have gone through a significant organizational change you must verify the continuity and effectiveness of their QMS. You must keep records of all supplier evaluations (whether initial or periodic), including any corrective actions placed on them for any nonconformities. You must identify and document all processes addressing this clause as part of your QMS. For these processes, you must also identify what specific documents, controls and resources are needed .You could use a documented procedure or other combination of specific practices, procedures, documents and methods. Look at the risks related to your product, processes and resources in determining the extent of documented controls you need to have. Performance indicators to measure the effectiveness of purchasing processes in meeting requirements and achieving quality objectives should focus on measuring supplier performance and reducing variation in and improving purchasing processes and related use of resources. Indicators for supplier performance may include reduction of defects in supplied product, scrap, waste and rework, improvement in on-time delivery, service, cost, etc. Indicators for purchasing process may include reduction in supplier- quote review cycle time, contract award cycle time, purchase order-entry errors and omissions, receiving errors & omissions etc.
ISO 9001-Clause 7.4.2 Purchasing information
ISO 9001 Requirement
Purchasing information shall describe the product to be purchased, including, where appropriate,
a) requirements for approval of product, procedures, processes and equipment,
b) requirements for qualification of personnel, and
c) quality management system requirements.
The organization shall ensure the adequacy of specified purchase requirements prior to their communication to the supplier.
Your purchase documents such as purchase order, contract, blanket order, your organization’s supplier quality manual, etc. must specify your requirements for the purchased product; the suppliers QMS and any other initial or on-going controls you deem necessary for ensuring consistent supplier performance. You must define how you ensure the adequacy of these documents before you communicate them to your supplier. A review of adequacy of purchasing documents may include their completeness, accuracy, correctness, quantity, timing, cost, approval, etc., by one or more functions; computerized controls, etc. In larger organizations, this may be a separate process on-site or off-site. In either case, it must be identified and controlled. While clause 7.4.2 does not specify keeping of records, you must show evidence of carrying out (issue purchase documents) and review of these documents
ISO 9001-Clause 7.4.3 Verification of purchased product
ISO 9001 Requirement
The organization shall establish and implement the inspection or other activities necessary for ensuring that purchased product meets specified purchase requirements. Where the organization or its customer intends to perform verification at the supplier’s premises, the organization shall state the intended verification arrangements and method of product release in the purchasing information.
Verification of purchased product can range from doing no verification to 100% verification. You have flexibility in determining the scope of purchased product verification. As indicated earlier in 7.4.1, you can apply different controls for different suppliers and products depending on your initial supplier evaluation and their ongoing product quality and delivery performance. In any case these controls must be included or referenced in your quality or inspection plans. To the extent that you decide to do verification of purchased product, you also have flexibility in when you do the verification. You can do it on receipt or at any time prior to use in production. Make sure you appropriately control un-inspected product. This may include identification and storage to prevent unintended use. Consider using supplier quality plans, inspection plans, etc., to verify that purchased product meets specified purchase (product and QMS) requirements. Your inspection process must define and document the acceptance criteria and sampling plan for product conformity and what measurement tools needed and records needed to show effective control of purchased product quality and supplier performance.
For Clause 7.4.1:
- From whom the organization can buy materials or services from?
- Is there an Approved List of suppliers?
- How does a Supplier get on the list? Any new ones added? How do Suppliers stay on the list? Is performance checked? How often are performance checked?
- Are criteria for selection & periodic evaluation defined?
- Are results of supplier evaluations & follow-up actions shall be recorded?
- Are types & extend of control to be applied to the supplier and purchased product dependent on the effects on subsequent product realisation process or the final product?
For Clause 7.4.2:
- How are orders placed to Suppliers? How is this information checked for accuracy?
- How do you ensure adequacy of specified purchase requirements prior to their communication to the supplier?
- Do purchasing documents contain information describing the product to be purchased, including where appropriate requirements for product approval, procedures, processes and equipment, qualification of staff and QMS requirements?
For Clause 7.4.3:
- How does the organization checks that what was received is exactly what was ordered?
- Are activities necessary for verification of purchased products established and implemented?
- Do the organization ever goes to a Suppliers premises to release a purchase order? Do Customers of organization ever do this with the Suppliers of organization ? If so, how is the Supplier made aware?
Mandatory Procedure : Not applicable
For Clause 7.4.1:
Results of supplier evaluations and any necessary actions arising from the evaluations. for eg Records of supplier evaluations, list of approved suppliers
|Example of format for List of approved suppliers|
|Example of format for Evaluation Rating of Suppliers|
For Clause 7.4.2:Not applicable
For Clause 7.4.3: Not applicable
Evidence/Implementation document ( Not mandatory but helps in fulfillment of requirement):
For Clause 7.4.1:
- Procedure for supplier evaluation
- Supplier audit checklist
- Supplier registration form
|Example of Procedure for Supplier evaluation|
|Example of Supplier audit checklist|
|Example of format for Supplier Registration form|
For Clause 7.4.2:
Purchase document: Purchase order, Work order, contract, blanket order, your organization’s supplier quality manual
|Example of Format for Purchase order|
|Example of Procedure for Purchase|
For Clause 7.4.3:
Inward Inspection report
Supplier quality plans, inspection plans
Consider using supplier quality plans, inspection plans, etc., to verify that purchased product meets specified purchase (product and QMS) requirements
|Example of format for Goods Inward/Outward Register|
|Example of format for Goods Reciept Inspection report|
|Example of Raw Material quality plan|
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