An internal supplier is also a supplier

In Geen categorie by Willem BaeldeLeave a Comment

In a previous edition of the Newsflash we have seen the importance of suppliers for the quality of the product or service a company can supply to its customers. Especially for larger companies it makes sense to first look if products or services to be bought in can be sourced from another part of the company. When looking for a reliable supplier who can be trust more than your own colleagues?
Indeed working with other parts of the same company as internal suppliers has clear advantages over external suppliers. Cost can be saved that would otherwise have ended up as profit for the supplier and confidential information stays within the company. On the other hand one wants optimal certainty that the internal supplier is just as reliable as the other suppliers.
To manage the quality from an internal supplier one first needs to have a clear picture of the nature of the collaboration. Is the other party indeed an internal supplier or actually just another department? For the sake of quality management the scope of the quality system can provide clarity if we are dealing with an internal supplier or collaboration between two departments of the same organization: if the activities of the supplying party are within the scope of the quality system we are dealing with collaboration between departments and the quality manual and underlying documentation is the place to clearly document all relevant agreements. In other cases we are dealing with an internal supply relation and it is strongly advised to make a Quality agreement documenting the relevant expectations and responsibilities within the collaboration relation.
The simplest form of an internal supply relation is when the two parties have no relation other than that they belong to the same company. In that case the internal supply relation will be very formal and there will be little or no difference between managing internal and external suppliers. The sourcing party will regularly evaluate the performance of the internal supplier using the exact same methods and criteria as for external suppliers, of course with the same consequences (increased inspection levels, limited supply, etc.). For this collaboration model there are even cases that requirements for internal supplier are tougher than for external ones.
But other forms of collaboration between parts of a large company have to be regarded as internal supply relation. An example is the situation when a concern supplies special services to various departments or divisions that are not in scope of a single quality management system. In such cases the services have to be regarded as from an internal supplier and therefore it is strongly advised to document and agree on the quality expectations and how they are managed and verified and what to do if expectations are not met.
Concluding we see that internal suppliers provide access to many unique capabilities of a large company but one has to take the right measures to optimally benefit from them. An effective way of working with internal suppliers facilitates ensuring the required quality level of the product or service your company wants to supply to its customers.

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