Subcontracts

This note applies to roadhaulage only. Haulers may subcontract the haulage, or employ independent traction (driver/tractor) or employ interim drivers. A written policy is expected, detailing what criteria have to be met in such cases, and at what stage the client is to be informed about the use of subcontractors. 

Flow-down provisions Terms and conditions which must be incorporated into a subcontract or purchase order to pass down obliga-tions/requirements imposed by the prime contract. These flow-down provisions will provide for certain protections, obligations, or requirements that will modify or add to any work agreement or purchase order terms and conditions. 

Signed copies of the work agreement or subcontract and implementing purchase order or contract... 

If you subcontract design, you must be able to demonstrate you have the appropriate capability to ensure your subcontractor meets the design control requirements of ISO/TS 16949. 

Are subcontractors selected on the basis of their ability to meet subcontract requirements ... 

Project reviews are not design reviews. Project reviews assess performance of the project and take into account timing, costs, organization, work assignments, subcontracts, etc. Design reviews look back at the technical aspects of design and look forward to the technical aspects of the design tasks ahead. 

The standard requires the supplier to provide appropriate technical resources for tool and gage design, fabrication, and verification activities, establish a system for tooling management, and implement a system to tack and follow-up tooling management activities if any work is subcontracted. 

If you do subcontract tool maintenance, you need to keep track of assignments so that you are not without vital tools when you need them. 

The contractual requirements are specified, including warranty, payment conditions, acceptance conditions, customer supplied material, financial liability, legal matters, penalties, subcontracting, licenses, and design rights. 

You also need to be careful that work is not delegated or subcontracted to parties about whom you have little knowledge. In subcontracts, clauses that prohibit subcontracting without your approval need to be inserted, thereby enabling you to retain control. 

The supplier does not need to own research and development facilities and may subcontract conceptual or complex design work to design studios. Clearly customers in the automotive sector are seeking new solutions to engineering problems and in order to capture the competitive edge, innovation is paramount. 

Acceptance criteria are the requirements which, if met, will deem the product acceptable. Every requirement should be stated in such a way that it can be verified. Characteristics should be specified in measurable terms with tolerances or min/max limits. These limits should be such that will ensure that all production versions will perform to the product specification and that such limits are well within the limits to which the design has been tested (see also Part 2 Chapter 2 under Identifying verification requirements). Where there are common standards for certain features, these may be contained in a standards manual. Where this method is used it is still necessary to reference the standards in the particular specifications to ensure that the producers are always given full instructions. Some organizations omit common standards from their specifications. This makes it difficult to specify different standards or to subcontract the manufacture of the product without handing over proprietary information. 

Testable items the design and/or manufacture of which are subcontracted... 

Prepare standard requirements for subcontracted design activities which specify the documentation requirements. 

Establish a mechanism of reviewing progress through the design and development process for in-house designs and subcontracted designs. 

How do you control subcontracted design and design verification activities ... 

The standard does not define what the specified requirements are in this case. Elsewhere in the standard the term seems to relate to customer requirements but when purchasing you may well not be passing on customer requirements to your supplier. In cases other than when truly subcontracting work, you will in all probability be deriving your own requirements. 

Notwithstanding the guidance given below under Evaluation and selection of subcontractors, this requirement does not relieve you of the responsibility for ensuring the quality of subcontracted parts, materials, and services. Therefore, it would be unwise to place orders on a customer-specified subcontractor without first going through your evaluation and selection process. You can obviously take some short cuts but don t make assumptions. The customer will not be sympathetic when you are late on delivery or your price escalates. If you find a subcontractor that can meet all your product/service requirements at a lower price you can submit details to your customer for approval. 

The standard requires the supplier to evaluate and select subcontractors on the basis of their ability to meet subcontract requirements, including the quality system and any specific quality assurance requirements. 

Subcontracts enable you to choose the degree of control exercised over your subcontractors. With suppliers, your choices are often limited as you have no privileges. Control over your suppliers is therefore exercised by the results of receipt inspection or subsequent inspections and tests. If your confidence in a supplier is low, you can increase the level of inspection and if high you can dispense with receipt inspection and rely on in-process controls to alert you to any deterioration in supplier performance. 

Prior to orders being placed the purchasing documents should be checked to verify that they are fit for their purpose. Again this requirement is appropriate to subcontracts but only if you submit your purchasing documents to your vendors. The extent to which you carry out this activity should be on the basis of risk and if you choose not to review and approve all purchasing documents, your procedures should provide the rationale for your decision. The standard does not require that the review and approval be documented. In some cases orders are produced using a computer and transmitted to the vendor directly without any evidence that the order has been reviewed or approved. The purchase order does not have to be the only purchasing document. If you enter pur-... 

It is important that you inform the subcontractor through the contract of how the product or service will be accepted. Will it be as a result of receipt inspection at the specified destination or as a result of acceptance tests witnessed on site by your authorized representative These details need to be specified at the tendering stage so that the subcontractor can make provision in the quotation to support any of your activities on site. If you have invoked ISO 9001 in the subcontract, you are protected by clause 4.6.4.2. If you have not, you need to specify a similar provision in your subcontract, otherwise you may lose the right to reject the product later. There is no requirement for you to document your proposal to verify product at the subcontractor s premises but such a plan would indeed be a useful section in any quality plan that you produced. (See also Control of subcontractors in this chapter.)... 

The standard requires that where specified in the contract the supplier s customer or his/her representative shall be afforded the right to verify at the subcontractor premises and the supplier s premises that subcontracted product conforms to specified requirements. 

Provide a means for adjusting the standard conditions according to the nature of the work subcontracted. 

Prepare procedures for producing and maintaining subcontract requirements and letting tenders. 

Provide those responsible for the preparation of subcontracts requirements to approve them prior to issue to the subcontractor. 

Provide a means for changing subcontract requirements during the contract. 

Do provide a means of apportioning the requirements of the main contract to the subcontract. 

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