SCHEDULE & DELIVERY
MANAGEMENT
Prepared by: Bonita Dunham and Bert Santiago
1
OBJECTIVES:
•
•
•
•
Define Corrective Action (C/A) and Root Cause
Identify when to issue CARs
Define levels of Corrective Action
Identify contractual requirements impacting
Schedule & Delivery Management in support of
Corrective Action Request issuance
• Provide examples C/A issuance
2
CAR Definition:
A request for root cause
remedy of a
contractual
noncompliance
3
Root Cause Definition:
That condition, action, or lack
of action that led to the
problem occurring.
Note: Root cause has been identified
when effective corrective action will
prevent problem recurrence
4
WHAT?
• Actions taken to eliminate conditions that
resulted in a contractual noncompliance
– Root cause of noncompliance should be identified
– Efforts are to the extent of precluding recurrence
of non-compliant condition
5
WHY (DCMC requirements)
• Directly impacts contractor delivery
performance
• CARs identified as Output of surveillance
effort
• Tool to facilitate timely delivery
• Rationale that supports surveillance activity
6
WHY (DCMC requirements)
• Supports “Right Time” metrics
1.1.2
Improve on Time Deliveries
1.1.3
Reduce Outstanding
Deliveries
1.1.8
Improve ratio
Alerts/Delinquencies
7
WHEN
• On time delivery rate is < 90%
• Data analysis indicates contractual
noncompliance trend
• Do not issue CAR for EACH delinquency
• Root cause analysis identifies processes
contributing to poor delivery rates
• Contractor is non-responsive to previous
CARs (escalation…)
8
HOW
DLAD 5000.4 PROCAS
• Any employee can initiate a CAR
• Maintain a record of all CARs issued, followup and close-out actions
• C/A implementation and effectiveness of
contractor actions shall be verified
• Four Levels of Corrective Action
9
• LEVEL I
–
–
–
–
contractual noncompliance
requires no special attention
directed to working level personnel
may be verbal or written
10
• LEVEL II
– written request
– systemic non-compliances
– directed to contractor mgmt responsible for the
process
– Inform CAT of issuance
11
• LEVEL III
–
–
–
–
–
serious non-compliances to contractor top mgmt.
Gov’t may pursue contractual remedies
coordination w/ ACO & Cmdr prior to issuance
issued by Team Leader or above
copy buying activity & cognizant Gov’t ofc at
prime as applicable
– Contractor immediately placed on the CAL until
C/A is verified and CAR closed out
12
• LEVEL IV
– involve contractual remedies
– must be issued by ACO, countersigned by Team
Chief or above
– copy of CAR and all correspondence to buying
activities.
– proper coordination between CAOs, Districts, HQ,
customers and other affected Gov’t activities
before issuance
13
• LEVEL IV(cont’d)
– assure all resolution efforts are in concert
– contractor immediately placed on the Contractor
Alert List (CAL) until C/A verification and CAR
close-out
14
DLAM 8000.5, PROCAS
• CAO management maintain visibility of all
LEVEL II and above CARs
• Escalation, due to non-responsiveness to
lower level CARs, as determined by the
Contract Administration Team
15
Contractual Requirements
• Although schedule violation is basic area of
Production related C/A, manufacturing
processes, (such as Manufacturing planning,
MRP II, work measurement, material
handling, integrated product development
and facility management) are likely to be
found as the root cause areas.
16
Contractual Requirements
• Contractor’s requirement relative to
many floor level manufacturing
processes are covered in Contract
requirements referencing Quality.
17
Contractual Requirements
• BOTTOMLINE: Do not limit
applicability of “contract
requirements” based on functional
area (i.e. quality or production)...
compliance to contract requirements
includes compliance to the delivery
schedule.
18
Contractual Requirements
• Complete contract review must be done
-to identify contractor obligations
under the contract
-to identify contractual
noncompliances
-reference applicable contractual
requirements in CARs
19
Contractual Requirements
• FAR 9.103 Policy
“…contracts shall be awarded to
responsible…contractors only.”
20
Contractual Requirements
• FAR 9.104.1 General Standards
“To be determined responsible, a
…contractor must…be able to comply
with the required or proposed delivery
or performance schedule…”
21
Contractual Requirements
• FAR 46.105 Contractor
Responsibilities
“The contractor is responsible for
carrying out its obligation under the
contract by…”
22
Contractual Requirements
• FAR 46.105 Contractor
Responsibilities
“Tendering to the Government… supplies
or services that conform to contract
requirements…”
23
Contractual Requirements
• FAR 46.105 Contractor Responsibilities
“The contractor may be required to provide and
maintain an inspection system or program for
the control of quality that is acceptable to the
Government...”
24
Contractual Requirements
• FAR 46.105 Contractor Responsibilities
“The control of quality by the contractor may
relate to, but is not limited to...”
“Manufacturing processes, to ensure that the
product is produced to and meets the
contract’s technical requirements;…”
25
Contractual Requirements
• FAR 46.105 Contractor Responsibilities
“…Procedures and processes for services to
ensure that services meet contract
performance requirements…”
26
Defense Priorities Allocation System
(DPAS) Requirements
15 CFR 700.13(d)(2)
states in part, “….shipment or performance will be
delayed, the person must notify the customer
immediately, give the reasons for the delay, and advise
of a new shipment or performance date.
27
Contractual Requirements
MIL-Q-9858A Quality System Requirements
Para 1.3 Summary
“The program shall assure adequate quality
throughout all areas of contract performance…”
28
• Contractual Requirements
• MIL-Q-9858A Quality System Requirements
• Para 1.3 Summary
“All supplies and services under contract, whether
manufactured or performed within the
contractors plant or at any other source shall
be controlled at all points necessary to
assure conformance to contractual
requirements…”
29
Contractual Requirements
• MIL-Q-9858A Quality System Requirements
• Para 1.4 Relation to Other Contract
Requirements
• “The contractor is responsible for compliance
with all provisions of the contract and for
furnishing specified supplies and services which
meet all the requirements of the contract.”
30
CRITERIA CONDITIONS AND
SITUATIONAL EXAMPLES
31
Verbal or Level I - Situation A
• While reviewing a random sample of purchase orders, the
functional specialist notices DPAS not being flowed down to
sub-vendors from prime contractor
• The functional specialist discusses the requirement with the
contractor’s purchasing agent, who acknowledges omission
and immediately issues P.O. modification to correct the error.
• Corrective action is furthered by the contractor amending his
work instructions/procedures, requiring flow-down of DPAS
requirements
32
Level II - Situation A
• Functional Specialist notices a negative trend in
Ontime delivery performance
• Further analysis reveals consistent problem with
(sub)vendor material having to be reworked after
Gov’t rejection in receiving inspection.
• Reworked material comes from same sub-vendor,
and is routinely received weeks after the planned
in-house receipt date.
33
Level II - Situation A (con’t)
• Production functional specialist coordinates with the
Quality specialist and issues a written CAR based
on the negative delivery performance trend and the
consistently late receipt of deficient sub-vendor
product.
• The Production functional specialist’s root cause
analysis identifies concern in the area of purchase
issuance i.e. are P.O.s being issued with adequate
lead time…how is the prime contractor controlling
his subcontractor
34
Level II - Situation A (con’t)
• Intensity of functional surveillance is
increased until an acceptable corrective
action response is received, implemented
and validated.
35
Level III - Situation A
• Contractor is non-responsive to previously
issued Level II CARs, as evidenced in
Gov’t documentation
• Continued missed internal milestones, due
to late receipt of sub-vendor product
36
Level III - Situation A
• Situation is coordinated with CAT members
• CAR is escalated by written issuance to
head of contractor organization, noting that
continued inaction may lead to more severe
measures
37
Verbal or Level I - Situation B
• Contractor processing/working hardware
not identified in daily schedule/bucket.
Conflict to internal procedures.
• Currently not impacting overall delivery
status however trend of working
around/outside daily schedule could have
negative impact on contract delivery
schedule.
38
Level II - Situation B
• Contractor continuing to process work
outside daily schedules/buckets. Still not
impacting contract delivery schedule,
however in violation of internal procedures
and production plan. Internal tracking of
hardware becoming difficult to manage,
monitor and identify.
39
Level II Situation B (con’t)
• Prior to issuance, coordinate action/activity
with CAO team. Explain impact.
• CAR issued to Production/Manufacturing
Manager with copy to production line
supervisor. (Good idea to copy the
contractor’s Quality Assurance department)
40
Level III - Situation B
• Contractor’s lack of action relative to
previous activity have now caused a
delinquent posture to delivery schedule.
Identifying and tracking hardware most
difficult. The problem extends beyond main
production line to spare part activity, retrofit
effort, and impacting inventory accuracy.
41
Level III Situation B (con’t)
• Unsure of contractor’s ability to ship end
items due to the lack of identification and
tracking ability. Build up/cushion of assets
no longer available.
• Contractor not able to provide a valid “get
well” date.
42
Level IV - Situation B
• Contractor’s lack of action now impacts
delivery posture (contract delinquency)
• Lack of action adversely impacting
associated systems (inventory management,
BOM accuracy, release quality, financial
inaccuracies, etc.)
43
Points to Remember
• Corrective action cannot be accomplished without
understanding contractual requirements
• Corrective action efforts will be ineffective
without ROOT CAUSE ANALYSIS
Reference Root Cause Analysis Guide
- Definitions
- Process Focus
- Methods
44
Points to Remember
• CAR = request for root cause remedy of
contractual noncompliance
• Adequacy of stated C/A determined via
follow-up verification of implementation
and objective evidence of compliant
condition.
• Root Cause identification is Government and
contractor concern.
45
Points to Remember
• Root cause analysis will uncover
Manufacturing process areas contributing
to the nonconformance
– promotes modified surveillance efforts by
the Industrial Specialist
– promotes increased process understanding
by the Industrial Specialist
– promotes evaluation of process efficiencies
and effectiveness by the Industrial
Specialist or Industrial Engineer
46
•
•
•
•
Examples Workshop:
CAR written formats (Levels II thru IV)
CAR documentation (all levels)
Root cause analysis Methods
PROCAS opportunities
47
“Give me a lever long enough…..
And single-handedly, I’ll move
the world”
Archimedes
48
Schedule & Delivery
Management
49