INTRODUCTION:

A methodical strategy for examining and managing the dependability and performance of suppliers who supply components, raw materials, or services essential to the manufacturing process is known as supplier quality management. It all comes down to making sure their contributions are consistent, predictable, and meet predetermined criteria. SQM may appear to be a very comprehensive system because it depends on choosing appropriate suppliers, establishing clear terms for them, and routinely profiling their delivery precisely in accordance with predetermined parameters. But fundamentally, there is only one straightforward goal to pursue: raising product quality while lowering total costs and addressing risks sooner.

Keeping parts consistent from batch to batch is crucial in a global market that is becoming more interconnected and where customers expect precision at every touch point. This is only possible if your standards are flawlessly followed by both your internal and external suppliers' procedures. Additionally, companies frequently depend on several suppliers for different components that make up their finished goods. For the development of a product, everybody offers a special contribution. Therefore, a single supplier's little variation might have a significant impact on the integrity of your final product, which in turn can damage client satisfaction levels.

Before we can go any further with this subject, let's review the main objectives of a successful supplier quality management system. In other words, supplier quality management assesses how it is used to:

1. Boost the procurement process's accuracy.

2. Simplify supplier assessments and audits.

3. Improve the lines of communication with suppliers

4. Promptly identifying and fixing non-compliance problems.

Businesses can monitor their supply chain processes more effectively by using SQM. This makes it possible to identify and address possible issues quickly, creating a dependable manufacturing flow that constantly provides customers with high-quality goods. One factor that makes supplier quality management (SQM) imperative is that it plays a critical role in reducing risk and guaranteeing product quality. Aiming for high-quality supplier performance can help reduce significant risks, such as product recall mishaps or safety hazards for customers. It doesn't have to stop here; improving product quality has the potential to greatly increase consumer satisfaction and give your company an advantage over rivals.¹

Supplier selection and evalution:

The goal of supply chain management (SCM) is to identify suppliers who meet needs, as selecting a supplier (or vendor) is a significant challenge for numerous businesses. The challenge of supplier selection initially has two dimensions: the first is the definition of the criteria used to evaluate vendors, and the second is the process or method used to rank these suppliers. A supplier's evaluation determines a number of things. A number of factors are commonly used for evaluation and comparison, including cost, reputation, delivery time, and quality. Both the outcome of the vendor selection decision-making process and the relationships between the criteria might be impacted by these factors.

A cooperative and long-term collaboration in supply chain management (SCM) for decision business might emerge from a suitable supplier. For this reason, it is imperative to use a methodical and efficient process or methodology to choose the most useful supplier. Finding the criteria is one of the study's goals in order to choose a provider. Investigating how the factors affect one another in order to create a correlation matrix between the criteria (which is then used to determine weights by multi-objective programming) and determine the relative weights of the various factors in order to determine the supplier scores using AHP (linear physical programming) and the quantity to be ordered from each supplier.

In the business world, the process of quantitatively assessing and approving potential suppliers is referred to as supplier evaluation. Ensuring that a portfolio of top-tier suppliers is at one's disposal is the aim of the supplier evaluation. The primary goal of the provider
Reducing purchase risk and increasing the buyer's total value are the goals of the appraisal process. At the very least, it usually entails assessing the technological prowess, prospective delivery performance, supplier quality, and cost competitiveness. Preliminary supplier evaluation criteria include financial risk analysis, past performance reviews, and information provided by the supplier assessed.

There are two primary groups of supplier assessments and methods:

1. Individual methods

2. Integrated methods²

Supplier Evaluation Criteria:

Table no.1 Supplier Evaluation Criteria²

Factors	Explanation
Quality	A dependable, user-friendly, and easily maintained supplier product could facilitate the buyer's operations.
Trust	Customers who have a high degree of faith in the supplier are more inclined to engage in amicable discussions and transparent correspondence.
Commitment	The capacity of supply chain participants to fulfill the criteria in the allotted time. Partnerships are not only mutually rewarding but also mutually demanding since shared commitment generates opportunities.
Satisfaction	All the individuals engaged in the relationship trade are content and happy with each other's performance.
Safeguard	Making contact with possible providers can be viewed as a safety net or a fallback, but it can also lessen the customer's reliance on the provider.
Innovation development	Customers can expedite their development process, take on bigger, riskier, and longer-term projects, and be more technologically involved by leveraging the resources of suppliers.
Information exchange	Providers can provide a consumer with deeper insights into specific areas or decades of business knowledge.
Inter-dependence	Interdependence drives the development of stable, cooperative, and mutually beneficial long-term partnerships between suppliers and purchasers. It represents the degree of mutual reliance that is necessary for either entity to avoid missing out on opportunities, clients, or sales.
Social support	The reason social features matter is that individual actors within a corporation are mostly responsible for the mutual orientation amongst them. A positive work atmosphere will be produced by collaborating with helpful and understanding partners. Depending on how well they perform, the volume of business awarded to particular providers should be gradually increased.
Increased volume to suppliers	Depending on how well they execute, the amount of work assigned to the chosen vendors should be gradually raised.

Risk assessment and mitigation:

The various techniques that companies might use to identify and manage the risks involved in doing business with a certain supplier are collectively referred to as supplier risk assessment. Working with suppliers has a number of possible risks, including problems with delivery, quality, and finances, among others.³

The process of identifying, assessing, and minimizing possible hazards connected to their outside suppliers or service providers is known as supplier risk mitigation for organizations. Supplier risk mitigation, which is typically viewed as a proactive strategy to address possible issues, is essential to supply chain management since it guarantees the company's financial stability, smooth operations, and upholds its reputation.

A Step-by-Step Guide in Mitigating Supplier Risk:

There are just four phases in the risk mitigation procedure. Even if it seems easy, managers must be deliberate and careful in order to accurately identify and manage possible hazards.

1. Determine the dangers: Recognizing the various risks that could impact operations and the supply chain as a whole is the first step. Organizations can determine the appropriate course of action by doing background checks on possible partners and closely examining their financial situation, performance history, and adherence to laws and industry norms.

2. Evaluate the risks: Examine the qualitative risks according to their significance and probability of occurring. Adding metrics to these, including severity scores, probability percentages, and financial loss estimations, helps quantify these and aids organizations in making well-informed judgments when evaluating suppliers and their capabilities.⁴

Quality assurance agreements:

The process of determining who is responsible for what and how communication between the manufacturer and the supplier should be simplified by a strong supplier quality agreement. It outlines the duties for every kind of action or document and lays out expectations for both parties.

Different companies may have different supplier quality agreements; however, they all usually contain the following:

1. Duration and extent of the contract.

2. Terms are defined inside the agreement.

3. Extensive details regarding the gadgets and activities discussed.

4. Arrangement wherein the supplier agrees not to alter the product, procedures, or quality agreement without obtaining written consent from the manufacturer.

5. An explanation of the notification process for desired modifications.

6. Develop a strategy for managing investigations related to corrective and preventative actions (CAPAs).

7. Permitted manufacturer or regulatory body audits and/or visits to the supplier.

8. Requirements for maintaining records and paperwork.

9. If there is an agreement that the supplier will notify the manufacturer if the status of any certifications, such as a certified quality system, must be maintained by the supplier, that agreement should be followed.⁵

Continuous improvement:

Fig.1 Continuous improvement⁶

A quality management system (QMS) must have continual improvement as one of its fundamental components. It involves implementing changes gradually or all at once to continuously enhance goods, services, or procedures. By using continuous improvement strategies, companies may maintain superior performance levels, satisfy client demands, and quickly adjust to dynamic market circumstances.⁶

Regulatory compliance:

The Regulatory Affairs department is built on the foundation of current regulations. Every procedure will be in compliance with both national and international standards thanks to a well-designed Quality Management System (QMS). Recalls of products, fines from regulators, and any damage to the company's reputation are all greatly reduced by using this strategy.⁷

An enormous volume of complaints presented a significant obstacle for a well-known international pharmaceutical corporation with operations in North America, Europe, and Asia Pacific. The company's founder, concerned, asked the director of quality management to handle this problem. The Quality Director quickly developed and implemented a plan to digitally revolutionize their complaint-handling procedure in response. The volume of complaints was also impeding regulatory clearances; thus, this was critical.

As part of the company's digital transformation strategy, ComplianceQuest EQMS was implemented, so we have firsthand knowledge of this story. Their complaint handling was expedited by this implementation, which also improved overall quality control and regulatory compliance.⁸

Integrating regulatory compliance with SCM processes like order fulfillment, logistics, and warehousing presents a number of difficulties.

· Changes in Global Trade Affecting Logistics:

As laws and trade agreements change, the dynamic nature of international trade poses new difficulties. Logistics operations must be flexible to accommodate changes in trade laws, tariffs, and customs procedures. SCM becomes more complex when businesses operate internationally because they have to constantly review and modify their supply chain plans to reflect the changing nature of international trade.

· Data Management:

Big data management is becoming more and more difficult as supply chains become more digitally connected. Strict data privacy and security standards are frequently a part of regulatory compliance efforts. Strong data management systems are necessary to protect sensitive information's integrity and confidentiality while complying with a variety of legal requirements. To ensure compliance without sacrificing productivity, businesses need to invest in procedures and tools.

· Warehouse Safety:

One of the most important parts of complying with regulations is upholding safety regulations in warehouses. Strict attention is required to rules for the handling of hazardous products, storage needs, and occupational safety. It might be difficult to guarantee that warehouse facilities adhere to these criteria while maximizing operating effectiveness. To properly handle this compliance burden, investments in cutting-edge security systems, safety procedures, and regular training are needed.⁹

CONCLUSION:

In conclusion, supplier quality management (SQM) plays a pivotal role in modern supply chain management (SCM) by ensuring the dependability and performance of suppliers in providing essential components, raw materials, and services. By adhering to SQM principles, businesses can enhance procurement accuracy, simplify supplier assessments, improve communication, and promptly address non-compliance issues, thereby raising product quality while lowering costs and mitigating risks. The significance of SQM lies in its ability to maintain consistency across batches, meet predetermined criteria, and satisfy customer expectations in an interconnected global market. Through effective supplier selection, evaluation, risk assessment, and mitigation, coupled with quality assurance agreements and continuous improvement practices, companies can achieve superior supply chain performance and regulatory compliance. Moving forward, it is imperative for businesses to prioritize SQM as a strategic imperative to ensure competitiveness, sustainability, and customer satisfaction in today's dynamic business environment.

REFERENCES:

1. https://www.qarmainspect.com/blog/supplier-quality-management#:~:text=Introduction%20to%20Supplier%20Quality%20Management,-Definition%20of%20Supplier&text=Supplier%20quality%20management%20represents%20a,integral%20to%20the%20production%20process.

2. Gonela, Karuna & Rao, Vaddi. (2018). Supplier Selection and Evaluation in Supply Chain Management. International Journal of Science and Research (IJSR). 7. 1042-1050. 10.21275/ART20193779.

3. https://tipalti.com/procurement-hub/supplier-risk-assessment/#:~:text=Supplier%20risk%20assessment%20consists%20of,%2C%20financial%20instability%2C%20and%20more.

4. Eunice Arcilla Caburao Published 30 Jan 2024 Supplier Risk Mitigation: Protecting Business Continuity https://safetyculture.com/topics/risk-mitigation/supplier-risk-mitigation/

5. David Butcher, Staff Writer, MasterControl September 14, 2021 Supplier Quality Agreements 101: What, Who, and Why? https://www.mastercontrol.com/gxp-lifeline/supplier-quality-agreements-your-benefits/#:~:text=It%20specifies%20what%20is%20expected,of%20terms%20in%20the%20agreement.

6. https://www.arenasolutions.com/what-is-qms/continuous-improvement/#:~:text=One%20of%20the%20essential%20elements,incrementally%20or%20all%20at%20once.

7. https://qbdgroup.com/en/blog/quality-and-regulatory-affairs-key-elements-of-a-qms-in-pharma-for-compliance/#:~:text=Regulatory%20Compliance&text=A%20meticulously%20structured%20Quality%20Management,harm%20to%20the%20company's%20reputation

8. https://www.compliancequest.com/blog/role-of-management-review-in-compliance/

9. https://www.warehousingexpress.com/blogs/regulatory-compliance-and-security-in-supply-chain-management

Received on 25.04.2024 Modified on 13.05.2024

Res. J. Pharmacology and Pharmacodynamics.2024;16(3):239-242.

DOI: 10.52711/2321-5836.2024.00040