Configure quality management
The quality control component of Supply Chain Management provides access to the parameters that are required for setting up and managing a company’s quality testing requirements.
Quality orders define a set of one or more tests to perform on an item and are a fundamental component to quality management in Supply Chain Management. The quality order defines the quality specifications, an Acceptable Quality Level (AQL), the applicable test instrument, the documents that describe the test, and several other factors for each test.
However, before you create quality orders, several optional and required setup components must be configured.
To perform initial setup for quality management, you should set two parameters:
Use quality management - Enables quality management functionality and must be selected before any quality management features are available. Remember that this option is legal entity-specific and isn’t shared across the organization with other legal entities.
Hourly rate - This optional field is used to calculate an employee's time spent on activities that are related to quality work. This value is not used automatically because it will often be overridden by a trade agreement or price list from the Project and accounting management module.
These two parameters are found in the Inventory management > Setup > Inventory and warehouse management parameters and Quality management tab.
Test instrument
You can use test instruments to determine what equipment is needed to perform the test. A test instrument assigns a unit of measure that reflects the associated measurement and its decimal precision.
Test instruments are an optional setup, which you can find by going to Inventory management > Setup > Quality control > Test instruments.
Test
A test is quantitative, which means that specifications and test results are expressed as values for a specified unit of measure. Alternatively, a test can be qualitative, which means that specifications and test results are expressed as user-defined outcomes that reflect pass or fail.
Tests are added, changed, or deleted in a quality order.
For the set of tests, the quality order defines the overall AQL, the sampling plan and associated test quantity, the need for destructive tests, and the sequence of tests.
After you report the test results for each test in a quality order, start a validation process to assign a pass or fail status (based on meeting the overall AQL). Finally, you need to close the quality order.
As part of the test creation process, you need to define the allowed business processes during and after quality order validation.
For example, you can block the invoice update of a purchase order that has related inventory in the inspection process.
Optionally, a nonconformance is created when a quality order identifies defective material. The nonconformance provides the basis for more investigation after correction tasks are scheduled and correction actions are recorded.
Go to Inventory management > Setup > Quality control > Tests to create and maintain tests.
Item sampling
Item sampling is the quantity of sample items that are checked during a test. The specified quantity is either a fixed amount or a percentage. Item samplings are used with test groups and quality associations.
For example, assume that you are testing a quantity of sampled items. A company's guidelines require a random check of at least 50 pieces in every shipment that is received from a new vendor during the first 90 days of the relationship. To accommodate this requirement, you would set up item sampling with the fixed quantity value of 50.
Go to Inventory management > Setup > Quality control > Item sampling to define fixed quantity or percentage for items to be reserved for quality order tests.
Test groups
The Test groups page is where you set up, edit, and view test groups and the individual tests that are assigned to it. The test group on the quality order determines the assigned tests.
When administered, these tests determine whether an item passes or fails the quality control.
Go to Inventory management > Setup > Quality control > Test groups to create test groups.
Quality associations
Quality orders are automatically generated, based on rules that are defined on the Quality associations page. Other rules on the Quality associations page include generating a quality order for purchase orders, quarantine orders, sales orders, and production orders.
The Inventory management > Setup > Quality control > Quality associations page is used to create quality associations to automatically generate and track quality orders.
Before you set up quality associations, consider creating item quality groups and linking multiple items to them, which will allow you to logically group similar items for testing.
Quality associations are used to define the:
- Transaction event.
- Set of tests that must be performed on the items.
- Acceptable quality level (AQL).
- Sampling plan for a quality order that is generated by the system.
A quality association must be defined for each variation in a business process that requires the automatic generation of a quality order. In the business process, the system can generate a quality order for purchase orders, quarantine orders, sales orders, and production orders.
The Quality associations page supports the multisite feature. If a site is specified, the trigger for the automatic quality order creation is limited to that site only.
The business process that uses a quality association can be related to various source documents, such as purchase orders, sales orders, or production orders.
For example, you can set up a quality association that generates a quality order when a purchase order packing slip is updated. The triggering process might be blocked while there is an open quality order or the next processes, such as purchase order invoicing.
While open quality orders exist, inventory quantities are automatically blocked from being issued, which is set up with the Full blocking setting on the Item samplings page. The quantity is either the quantity on the quality order or the quantity on the source document line.
For a given business process, the quality association record identifies the event and the conditions that a quality order is generated for. The conditions can be specific to either a site or a legal entity. A quality order that involves destructive tests can be generated only when on-hand inventory exists for the event.
Watch the following video to see a demonstration of quality associations.
Create a quality order manually
You can use the Inventory management > Periodic tasks > Quality management > Quality orders page to manually create a quality order for the inventory of a specified item and test quantity. It also runs the tests within the specified test group.
The Quality orders page is also used to manually create a quality order for a purchase order, production order, or physical on-hand inventory. The test quantity and test group are also included. A quality order must be manually generated for an item's inventory quantity. The quality association record provides a default value for the AQL.
Scenario: James, a warehouse worker in Adventure Works Cycles, unloaded boxes from the vendor's truck in the inbound warehouse and noticed that one of the boxes appeared to be damaged.
The company policy dictates that suspected damaged items must be tested for quality. Therefore, James manually creates a quality order to have the products in the box inspected.
Nonconformances
A nonconformance describes products and items that don't comply with predefined performance or quality standards. In other words, it describes an item that has a quality problem. A nonconformance also applies to customer service or internal problems, such as customer complaints or production issues.
The problem source is called a Non conformance type. You can assign a Non conformance type, its detailed source information, and the associated problem type when it's created.
Nonconformances are associated with a Problem type, which are defined on the Inventory management > Setup > Quality management > Problem types page. On this page, you can specify which problem types can be associated with each Non conformance type.
Select the Non conformance types button to associate a Non conformance type for quality assurance.
You can define a classification of problem types to more easily analyze nonconforming material.
The nonconformance process lets you create a nonconformance order that describes a quantity of nonconforming material, the problem source, the problem type, and explanatory notes.
For example, the problem types for nonconformances of the Service request type might reflect a classification of customer complaints, whereas the problem types for nonconformances of the Internal type might represent a classification of defect codes.
The following list describes the Non conformance types and the information that must be recorded for each type:
- Customer - This type includes customer account number, the sales order number, or a lot number of a sales order transaction. For example, the nonconformance might be related to a specific sales order shipment or to customer feedback about product quality.
- Service request - This type includes the customer account number, the sales order number, or a lot number of a sales order transaction. For example, the nonconformance might be related to a specific sales order shipment or to a customer's complaint about item quality.
- Vendor - This type includes the vendor account number, the purchase order number, or a lot number of a purchase order transaction. For example, the nonconformance might be related to a purchase order receipt or to a vendor's concern about a part that it supplies.
- Production - This type includes the production order number or a lot number of a production order transaction. For example, the nonconformance might be related to a specific batch that was produced.
- Internal - This type includes the quality order number or a lot number of a quality order transaction. For example, the nonconformance might be related to the tests that are performed as part of a quality order or to an employee's concern about product quality.
- Coproduct production - This type includes a coproduct production order nonconformance that is related to batch production orders.
When you create a nonconformance, select the Non conformance type and the Problem type. The initial approval status is New, which represents a request for action.
The next step is to change the approval status to Approved non conformanced or Refused non conformanced, to indicate if you will act on the nonconformance. You can also close a nonconformance to indicate that you're finished with it, or you can reopen a nonconformance to indicate that another consideration is required. To do this, select the Functions drop-down in the Action Pane.
You can also print a Non conformance tag and a Non conformance report to guide the disposition of nonconforming material.
The Non conformance tag displays similar information and includes the quarantine zone and type (such as Restricted usage or Unusable) that you assigned to the nonconformance to help guide disposition of the defective material.
For example, the tag and report might indicate a condition of Unusable or Restricted usage as a value for the Quarantine type field. To view the Quarintine type, inside of the Non conformances page, select General.
You can then use the Report setup page to define whether comments for this document type should be printed on the nonconformance report and nonconformance tag.
You can define more than one record to print different document types on a report or to print internal and external notes. You might find it helpful to use the Document type page to define a unique document type for nonconformances and a unique document type for corrections.
You can enter comments for a nonconformance by attaching a document.
For example, you might want to enter notes about a nonconformance by using the unique document type for nonconformances in the report options.
The Conformance report and Non conformance tag can help with material disposition. You can generate reports and tags, based on selection criteria that are associated with a nonconformance. These criteria include the nonconformance number, item, customer, vendor, and status.
The Non conformance report displays the nonconformance number, item, and problem type. Depending on your report setup policy, the report might also display related notes about the nonconformance.