Audit yields unexpected benefits

"We’ll need to send our national QA director to your facility to conduct a supplier audit.” National QA director?! Audit?! It’s not the IRS, but when you’re working with a growing international OEM that’s attempting to establish your shop as a key supplier, it’s nearly as stressful. That’s not because we didn’t expect to pass it, but because of the magnitude of business this new customer represents—it’s absolutely critical we exceed their expectations. 

This relationship started simply enough. The purchasing guy at an old customer mentioned this company to us and said they were expanding and needed suppliers with our capabilities. 

After the initial contact, we set up a meeting to review their situation and assess whether we were a good fit to pursue their business. We eventually snagged a couple of small orders, which we delivered on time and to the expected quality. This led to another meeting where they wanted more information about our capabilities. 

Not sold but sufficiently impressed, they soon sent us 50-plus pages of drawings with some professional communications along the lines of, “OK, let’s see what you can do with this mess.” Upon receiving the package, the magnitude of this opportunity was explained to me: They manufacture a variety of heavy equipment and industrial products that are sold internationally, they’re consolidating other operations into a new facility near our shop, and they like us. Nice combination so far. 

We knew we had to get this package reviewed and quoted ASAP. Everyone dug in and spent a few days reviewing drawings and crunching numbers. As is common, the company needed it yesterday and were eager to see what we provided so they could make a decision. 

Within a day of submitting the quote, the procurement manager verbally informed us we’d be getting the entire purchase order within the week. The order was sizable for our shop, and it was great news. However, before receiving the official PO, they told us that to get this business and become a key supplier, our facility would be required to pass a stringent QA audit. While this wasn’t totally unexpected, we had gotten ahead of ourselves thinking about that first big PO without conditional requirements.

At this point, the OEM was experiencing supply chain and quality issues while trying to manage their international growth. They discovered many suppliers had never been visited, much less audited, and they weren’t confident many of them had the facilities and capability to keep pace. Their national QA director was instructed to hit the road. He commenced a North American tour of shops with safety glasses, clipboard and audit instructions in hand, eventually visiting my shop.

In preparation, we performed an internal audit and tightened several areas that needed attention. The audit day came quickly, and they showed up at 4 p.m. instead of 1:30 and stayed until 8:45 that evening, with us answering pages of questions and reviewing our shop’s QA policies in depth. The QA director was professional and thorough. He said he was impressed with what he saw at our shop and had removed many other suppliers for failing his audit. Thankfully, we passed and finally received the PO. 

In the end, I reviewed with my team what sold the customer and emphasized these points to them. First, the customer appreciated our willingness to come meet them in person so quickly. They appreciated our professionalism, quick turnaround, and found our technical and software expertise to be quite useful. 

Now the real challenge begins of fulfilling their expectations. Nonetheless, the audit helped us become better, and we added a recognizable company to our customer list.