Understanding Corrective Action Boards and Business Rhythms
Corrective Action Boards (CABs) are forums that support preventive and corrective actions to enhance service/product quality and customer satisfaction. Guidelines and purpose emphasize continuous improvement. Business Rhythms outline meeting structures for different organizational tiers to ensure effective communication and oversight.
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Corrective Action Board Corrective Action Board Overview Overview Updated: 26 April 2016 1
What is a Corrective Action Board? What is a Corrective Action Board? A Corrective Action Board or CAB is the forum to communicate, enable, facilitate, and provide oversight and direction for preventive and corrective action activities in order to resolve issues, support improved service and/or product quality, and promote Customer satisfaction. 2
Purpose Purpose Evaluate the overall program health Identify causes and prevention of potential non-conformances Identify areas of risk and program issues Promote continuous improvement Improve quality, cost and schedule Promote timely communication among multiple functions 3
CAB Guidelines CAB Guidelines Program CABs should be operated at facilities that provide deliverable hardware, firmware, software or services. CABs shall be a mandatory meeting to all attendees Each CAB should be comprised of members with the responsibility and authority to analyze and implement corrective actions. CABs should include the use of: Rosters/Attendance- Sheets completed and maintained during each CAB. Meeting Minutes- Discussion/review of agenda topics provided to CAB attendees following each CAB. Formal agenda- To be maintained and published to attendees containing topics in support of the business. Action Items List- Assigned tasks to team members tracked for timely closure and effectiveness 4
Business Rhythm Two Tier Business Rhythm Two Tier Site/Shop Floor Teams Weekly/Bi-Weekly (1-2 hrs) Manufacturing/Design Engineering Supplier Quality/Quality Engineering Production Planning & Controls (PP&C) Global Supply Chain/Procurement Site Leads Functional Leads Senior/Program Leadership Monthly (1 hr) Vice Presidents Directors Functional Senior Management Program Commodity Leads Program Management Recommended for small/medium businesses 5
Business Rhythm Three Tier Business Rhythm Three Tier Production Teams Weekly/Bi-Weekly (1-2 hrs) Manufacturing/Design Engineering Supplier Quality/Quality Engineering Production Planning & Controls (PP&C) Global Supply Chain/Procurement Leadership Council Monthly (1 hr) Site Leads Functional Leads Program Commodity Leads Senior/Executive Management Monthly/Quarterly (1 hr) Vice Presidents Directors Program Management Functional Senior Management Recommended for larger businesses 6
Roles & Responsibilities Roles & Responsibilities Program Management Chair of the CAB Responsible for program performance Manufacturing/Design Engineering Ensure production impacts and risks have defined mitigation strategies Implement manufacturing and technical impact resolution strategies Ensure technical impacts and risks have defined mitigation strategies Implement error proofing strategies to prevent occurrences Supplier Quality/Quality Engineering Implement supply chain impact resolution strategies Implement proactive risk avoidance strategies for supplied products Implement proactive risk avoidance strategies for internal manufacturing Global Supply Chain/Procurement Ensure purchased materials meet the program needs Proactively engage our suppliers to mitigate risk in our global supply chain 7
General Topics General Topics GIDEP & Warning Alerts Test & Process Yield / Failure Trends Customer Issues / CARs Internal Operating Plan Stock Purges CAB Non- Audit/ Conformance Report Trends Assessment Results Field & Component Issues Manufacturing Losses (Scrap and Rework) Supplier Corrective Action Requests (SCARS) MRB Decisions Deviation, Waivers, Escapes, Etc. 8
Suggested Agenda Items By CAB Level Suggested Agenda Items By CAB Level Site/Shop Floor CAB Senior CAB Metrics that drive performance Receiving Inspection Failures SCARs over 30 days/ SCAR trending Deviations/Waivers/Contingency Letters Escapes Upcoming Supplier Quality Activities Action items Stock Purges Component Issues MRB/FRB (Material Review Board and Failure Review Board) Actions Lessons Learned Rejections, Rework, Scrap Trending First Pass Yield ( Test & Assembly) Non-Conformance Report Trends Suspect Product Notifications (SPNs) Corrective Action Plans (CAPs) Test Failure Trends Manufacturing Operations Status Procurement Critical Path Status Risk Management Issues Special Projects/Continuous Improvements Unverified Failures/ Can-Not-Duplicates (CNDs) Government-Industry Data Exchange Program (GIDEP) Alerts 9
Suggested Agenda Suggested Agenda Items By CAB Level Items By CAB Level Production CAB Leadership CAB Senior CAB Shop Floor Rejects (SFRs) Rejections, Rework, Scrap Trending Receiving Inspection Failures SCARs over 30 days/ SCAR trending Escapes Action items Stock Purges Deviations/ Waivers/ Contingency Letters Component Issues MRB/FRB Actions Constraints Upcoming Supplier Quality Activities Manufacturing Operations Status Procurement Critical Path Status Nonconformance and Failure Analysis Inspection vs. Operator Error Trends Risk Management Issues Lessons Learned Metrics that drive performance First Pass Yield ( Test & Assembly) Non-Conformance Report Trends Suspect Product Notifications (SPNs) Corrective Action Plans (CAPs) Test Failure Trends Special Projects/Continuous Improvements Unverified Failures/ Can- Not-Duplicates (CNDs) Government-Industry Data Exchange Program (GIDEP) Alerts Escapes 10
Senior Level CAB Senior Level CAB A CAB at senior level is critical to optimize program performance. Charts presented to Senior Level should be reviewed by various team members and well prepared. A majority of the topics at Senior CAB should address a broad level of the specific items topics discussed during lower level CABs. Issues previously discussed that risk delaying or stopping production. Continuous improvement plans for significant previously discussed issues. Trending and analysis of the following items presented during lower level CAB: Non-Conformance Reports or Defect Documents Waivers Shop floor rejects Scrap Rework Corrective Actions 11
Examples of Charts for CAB Examples of Charts for CAB 12
Open Action Items Open Action Items Item Open Date Actionee Action Closure Criteria Status ECD Priority This lists action items that are created during CAB and can be looked at the beginning of each CAB. 13
Example 4 Blocker Example 4 Blocker Nonconformance Trend/History Part Number; Part Name; QTY Containment: Verify Complete current and future containment of products if necessary Requirement: Should be condition Defect: Actual condition Trend: List past occurrences of this defect if applicable Disposition of Hardware Actions Disposition: Briefly describe disposition of hardware Corrective Actions: Briefly describe the corrective action that addresses the root cause Place images here if applicable Supplier Quality Actions: List any follow-ups for the corrective cations that need to be completed to prevent future occurrences 4 blocker used for SFRs, rejects, reworks, SCARs, etc. 14
Measuring Supplier Performance Measuring Supplier Performance Supplier Monthly Rating Determined as Follows: > or = 95% > or =98% > or = 88% > or = 86% < 86% < 88% > or =96.8% > or = 87.1% < 87.1% 4 Blockers should be created when rating is yellow or red for the previous month 15
Example 5 Blocker Example 5 Blocker Team: Project Support: Manager: Problem Statement Major Milestones Proposed Solution Final Milestone Assigned Date Near Term Actions/Issues Concerns Risks 5 blocker used for Special Projects, Continuous Improvements, CAPs, etc. 16
Escapes/Stock Purges Escapes/Stock Purges Escape #/ Stock Purge # Part # Supplier Date Issue Impact Status POC Escapes are non-compliant hardware that is delivered to the customer. Stock purges are due to suspect hardware which possess a risk to the program. 17
Scrap and Rework Costs Scrap and Rework Costs Scrap and Rework Tracking 60 Sales = $1,000,000 50 Rework and Scrap Costs 40 (in Thousands) Rework 30 Scrap Goal 20 10 0 Jan Feb Mar Apr May Jun Rework Cost Labor ($) to return product to conformance/engineering Standard or actual cost spent on correcting defective work Scrap Cost Material costs and labor of work ($) performed up to the point of scrap Goal Starting at 5% of sales Work to have a constant reduction goal (10%-50%) 18
Defects Per Unit (DPU) Defects Per Unit (DPU) * The ratio of defects to unit completions is a measure of quality. Tracking helps to identify defects and drive root cause and corrective action. The numerator accounts for team caused defects. The denominator accounts for unit completions. * 2 month rolling average (includes current & previous month s actuals) 19
Scrap Scrap Jan Feb $13,103 $26,012 1,614 2,866 $8.12 $8.92 $9.08 Mar $14,756 $40,768 2,067 Apr $14,208 $54,976 $14.37 May $13,761 $68,737 1,384 Jun $12,576 $81,313 2,243 Jul $12,649 $93,962 2,126 11,675 Aug $12,188 $106,150 1,073 12,748 $11.36 Sep $12,459 $118,609 1,373 14,121 Oct $12,763 $131,372 1,683 15,804 Nov $12,860 $144,232 2,363 18,167 Dec $12,996 $157,228 1,236 19,403 $10.51 Scrap Total CUM Scrap Total Standard Hours Total CUM Standard Hours Total Scrap Per Standard Hours Scrap Per Standard Hours Goal YTD Scrap per Standard Hours $12,909 $12,909 1,252 1,252 $10.31 $9.01 $10.31 989 4,933 $7.14 $8.83 $8.26 5,922 7,306 $9.94 $8.65 $9.41 9,549 $5.61 $8.57 $8.52 $5.95 $8.48 $8.05 $9.07 $8.31 $8.40 $7.58 $8.23 $8.31 $5.44 $8.15 $7.94 $8.74 $9.28 $8.40 $8.33 $8.07 $8.10 Scrap is nonconforming material that is not usable for its intended purpose or cannot be economically reworked or repaired Scrap usually occurs in the high precision/high cost areas, where committed money and man hours are high. Determine scrap goal and aim to lower it by 1% each month. Control scrap to control cost. Evaluate scrap trends to determine material or process issues. 20
SCAR Performance SCAR Performance Any material or quality system discrepancy that is determined to be supplier responsible that is found during surveillance, sourcing, receiving activities and/or manufacturing/floor activities is noted in a SCAR. Measuring SCAR response time helps to ensure actions are taken to evaluate the non-conformances. 21
Escape Tracking Escape Tracking Lockheed Martin Missiles and Fire Control Escape Tracking 2013 Sum January February 80 5 19 2 61 3 5 March 4 3 1 16 April 5 3 2 21 May 6 4 2 27 June 9 6 3 36 July 3 2 1 39 August September October November December 2014 Sum 5 7 3 1 2 1 4 5 2 44 51 54 Issued (P1) Floor (P2) Other (P1-P2) Issued Cum 7 3 4 12 4 3 1 4 3 1 62 62 33 29 58 Increased defects due to repetitive problems or root cause could lead to a decrease in customer confidence/rating. Trending prevents costly defects that can result in reduced score card ratings in P1 P5 section. Measuring the quantity of Qnotes and their related common issues and cause allows a trend to be developed to identify focus areas for improvement over a rolling 12 months. 22
Additional Slides The following slides are useful for root cause/corrective action analysis for significant issues. These are not presented during CAB, however, issues that require analysis are often related to various other topics that are discussed (i.e. trending, stock purges, open quality notes, etc.). 23
Corrective Action Process Corrective Action Process Remedial Action Prevent Reoccurrence Corrective Action Implementation Prevent/Predict New Occurrence Root Cause/ Corrective Action Analysis Define Control / Monitor Containment Non-conformance Select best value solution Develop implementation plan Execute corrective action Who is the problem with? What is the problem? Where can it be found? Has it occurred before? What parts are effected? Stock Purge? Stop shipments? Escapes? Identify potential causes using: Fishbone, fault tree, 5 Why s, flow chart, etc. Identify primary cause Brainstorm potential solutions Follow-up corrective action (30,60,90 days) Analyze improvements Lessons learned For significant issues, an investigation should follow this process to clear all hardware and prevent future occurrences. Status can be shown during CAB to get input from team members. 24
Fishbone Analysis Method Fishbone Analysis Method Potential Contributor (major category) Potential Contributor (major category) Color Key Conclusive Refuting Evidence Exists No Evidence to Support Cause of Issue Potential Issue Contributor/Cause Evidence to support Issue Cause In-progress test/analysis Potential Contributor (minor category) Potential Contributor (minor category) Potential Contributor (minor category) Potential Contributor (minor category) Problem Potential Contributor (minor category) Potential Contributor (minor category) Potential Contributor (sub Potential Contributor (minor category) category) Potential Contributor (minor category) Potential Contributor (minor category) Potential Contributor Potential Contributor One method to Root Cause analysis Add bones as necessary Color of potential contributors should match key Color should correspond to highest level of implication 25
Fishbone/ Fault Tree Rationale Fishbone/ Fault Tree Rationale Add rationale sheets as necessary to cover every bone. 26
5 5- -Whys Method Why s Method Issue: The Jefferson Memorial is deteriorating 1.Why? 2. Why? 3. Why? 4. Why? 5. Why? Too much washing Excess bird droppings A lot of spiders to eat A lot of gnats to eat The lights are consistently left on Use the 5 Why s method to determine the root cause of significant issues. Once root cause is determined, develop corrective action plan to address root cause. 27
Acronyms Acronyms CAB Corrective Action Board PP&C Production Planning & Controls CAP Corrective Action Plan QNotes Quality Notes CAR Customer Account Representative QTY Quantity CND Can-Not-Duplicate SCAR Supplier Corrective Action Request CUM Cumulative SFR Shop Floor Reject DPU Defects Per Unit SPN Suspect Product Notification ECD Estimated Completion Date YTD Year To Date FRB Failure Review Board FPY First Pass Yield GIDEP Government Industry Data Exchange Program NCRT Non Conformance Report Trends MRB Material Review Board 28
