Supplier Vendor Audit Program

Improve Supplier Controls with an Effective Supplier Audit Program

Today, more than ever before, frequent and more intensive supplier audits are critical to ensuring supply chain integrity. Globalization, increased product complexity, outsourcing, and expansion into emerging markets have prompted regulatory agencies, particularly the FDA, to take a closer look at how manufacturers manage their suppliers. Those who utilize the services of contract manufacturing organizations (CMOs), clinical research organizations (CROs), and other third-party vendors must be ready to endure more import-related inspections, as well as toughened penalties for violations. A company's ability to withstand this increased regulatory scrutiny, and maintain its brand equity, will depend largely on the efficacy of its supplier audit program.

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How to Successfully Manage Your Suppliers and Ensure Product Safety and Compliance

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Free Supplier Management Resources

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Industry Brief: How to Successfully Manage Your Suppliers and Ensure Product Safety and Compliance
Data Sheet: MasterControl Supplier
Solution Overview: MasterControl Supplier Excellence Overview

Challenges of Developing and Maintaining a Supplier Audit Program

Implementing a comprehensive supplier audit program to qualify suppliers yields many benefits to regulated organizations, such as improved efficiency, product quality, and profitability. However, today's increasingly global supply chain makes it difficult to develop and execute such a program - especially when managing tens, hundreds, even thousands of third-party providers, many of whom collaborate with different departments and geographically dispersed divisions across the company. Nevertheless, in the view of regulatory agencies, product safety and efficacy are the manufacturer's (not the supplier's) responsibility. Unfortunately, many companies are at a loss as to where and how to begin when it comes to designing an effective, yet sensible supplier audit program - one that maintains audit quality but does not waste money auditing suppliers who pose little risk. A good place to start is to examine the key elements of the most effective supplier audit programs

A centralized platform for collecting supplier performance data

When a company chooses to outsource, it must deal with multiple contractors at any given time. For example, a pharmaceutical company may contract with a number of vendors while running several studies on the same compound. Unless the company builds a centralized platform and/or structure for gathering or receiving information into its supplier audit program, it will have to look for performance data from each vendor in different places. What is more, information stored in electronic servers may have to be printed and routed manually; this makes any document-based or manual system inefficient. The process is compounded when the company must deal with its own internal complexity, i.e., when multiple divisions or departments produce supplier data "silos" that operate in relative isolation - essentially conducting their own supplier audit programs. This lack of visibility, which stems from not having a standardized data collection process, makes it difficult to obtain accurate, objective data.
The ability to report problems and changes involving suppliers quickly and effectively

The best supplier audit programs allow for swift handling of supplier-related quality issues and events. Each activity that involves suppliers must follow well-defined processes and good standards. Each activity (including delivery of parts or ingredients or services and the quality of what you are receiving) needs to be thoroughly documented and assessed. This becomes particularly critical when problems or deviations arise. For regulated companies, it is critical to have an effective system for reporting and correcting supplier problems before they result in recalls. Without an effective supplier audit program in place, quickly obtaining the necessary data to drive a corrective action to completion is difficult.
Promotes good communication between manufacturer and supplier

The success of any supplier audit program depends on successful communication between the parties involved: the manufacturer and the contractor / supplier. In a regulated environment, it is imperative that this kind of information is documented. In addition, FDA-regulated companies are expected to specify quality-related responsibilities in their contract agreements. Such agreements should include triggering events for on-site audits, change control expectations, periodic reviews of validation efforts, and reviews of documentation for risk evaluation and assessments among many GMP conditions that would eliminate embarrassing ambiguity or lack of critical ongoing communication. Supplier audit programs that impede the flow of communication put your organization at risk.

How MasterControl Can Help You Develop a Sound Supplier Audit Program

It's inevitable: more diversity in the supply chain yields greater risk, and the only way to minimize that risk is by conducting frequent, more intensive third-party audits as part of a sound, enterprise-wide supplier audit program. The MasterControl manufacturing software solution provides a framework that helps regulated organizations manage their suppliers successfully, as well as the tools to make it easier for them to communicate and collaborate with one another. Here are some of the features MasterControl offers to address the challenges mentioned above

Electronic AVL

Most regulated manufacturers need an Approved Vendor List (AVL) to make sure that the parts being supplied to them adhere to required specifications and quality standards. However, maintaining an accurate AVL, a crucial component of all good supplier audit programs, can be a daunting task, particularly when the information is stored in disparate systems. MasterControl Supplier™ simplifies the process by providing an AVL that's easy to maintain, as well as a single, easy-to-access repository for all documents pertaining to supplier status and quality information. This user-friendly AVL not only manages approved suppliers, but also tracks the specific good and services they are authorized to supply. Adding new suppliers or removing inactive ones, viewing supplier lists, and importing or updating supplier information is easy and efficient. With MasterControl guiding your supplier audit program, cumbersome spreadsheets and disparate notes and files for your AVL become obsolete. Best of all, you won't waste time or money auditing suppliers who are not longer active or approved for purchase.
Internet-Based Platform

Collaboration is key component of all effective supplier audit programs. Often times, contractors and manufacturers need to be part of a review, approval, or revision process. MasterControl Documents™ makes this collaboration possible by providing a platform for storing, routing, escalating, revising and approving documents regardless of the software used to create them. MasterControl's Internet-based platform gives users, both internal and external, in different locations or time zones access online, which makes documents-based and forms-based collaboration possible from virtually anywhere. MasterControl's Explorer, a tool similar to Windows Explorer, helps improve the efficiency of your supplier audit program by allowing each team to maintain its documents, and at the same time allows documents to reside in multiple Explorers. You can create individual Explorers for your external suppliers / collaborators, which allows them find all the documents that need their input faster.
Automatic Audit Scheduling and Tracking

Planning and scheduling supplier audits, another hallmark of effective supplier audit programs, can be quite complex given the large number of suppliers a typical regulated company is juggling at once. And monitoring supplier information, such as supplier audit results and nonconformances, is an ongoing process. If your supplier audit program relies on paper documents and disparate electronic files to track supplier audits and information, you run the risk of double booking auditors and allowing some audit-related findings to fall through the cracks. MasterControl automates the planning of all recurring audit related activities, which helps to avoid double booking and streamlines the scheduling process.
Robust Reporting Capabilities

To maintain an effective supplier audit program, companies need robust reporting tools which will allow them to follow up on audit findings and / or to spot potential outsourcing problems that could compromise product safety or compliance. Without the ability to trend and track suppliers adequately, audit issues that may lead to corrective/preventive actions (CAPAs) can go unaddressed and result in penalties and diminished brand equity. MasterControl Audit™ provides powerful reporting capabilities that allow managers to see the big picture of their supplier audit programs. Because the solution is tightly integrated with other MasterControl quality applications, such as Risk, Supplier, and CAPA, it provides a comprehensive solution that facilitates efficient management of both internal and external supply chain risk. For example, audit data is integrated with supplier scorecards, while quality event forms, such as supplier corrective actions (SCARs), can be launched directly from audit findings. Connecting the audit process with the rest of the quality system results in a comprehensive approach to quality management - and an integral part of any effective supplier audit program.