Corporate Sustainability Rreport

Consolidated Supplier Management

Supplier Management Mechanism

YOKE divides purchases into 12 types according to their nature (3 major categories) and critical degree (3 major categories; outsourced processing purchases are referred to as “activities”). With the exception of general purchases/activities, all suppliers are subjected to evaluation. Starting from supplier selection, YOKE adopts mechanisms involving varying depths to inspect them and become involved in the growth and upgrade of the suppliers. The hope is to lead all partners in the supply chain towards joint growth taking advantage of the sound supplier inspection and counseling mechanisms and to advance in the safe lifting components and high altitude operation fall-proof safety equipment fields so that the company can continue to grow and become strong. YOKE divides evaluations into periodic ones and annual audits according to the time points and frequencies involved in the supplier inspection mechanism.

Type of Procurement

Industrial safety lifting components and accessoriesHigh Altitude Operation Fall-proof Safety Equipment and Fittings
Sheaves

Critical Degree

Key components/Activities
Non-key components/Activities
General Purchases/Activities

Supplier Rating

New Supplier Evaluation
Annual Supplier Audit
Supplier Re-evaluation

Supplier Evaluation

Procurement Dept works with new suppliers from time to time depending on the demand. Once to the supplier meets the requirements, it would be required to complete the supplier survey. T The inspection form includes corporate responsibility management systems, energy-saving plans, availability of an internal/external mailbox for complaints, charity events, and punishments by the authority for having economic, environmental, human resources violations, product-related laws and regulations and so on. Once the questionnaires are replied, the Procurement Dept, Quality Assurance Dept, Development Center and the Manufacturing Department would discuss it. Together they visit the manufacturing site of the new supplier for an audit or quality inspection. Once it is confirmed that the supplier meets related requirements, it would be acknowledged as qualified suppliers. After the samples and small-batch mass production are tested without errors found, the order is officially placed. In 2018, 22 suppliers passed our new supplier evaluation, bringing the total number of suppliers that deals in business transaction with YOKE to 409 for the entire year.


0
In 2018, 22 suppliers passed our new supplier evaluation




Suppliers of key components must be re-evaluation once every 3 years and suppliers of special process once every 2 years. For suppliers involved in non-key procurements, they would be re-evaluated once every 5 years. Standards of re-evaluation shall be identical to that of new supplier evaluation. A supplier has to get a score of 70 (C) or higher at the same time to be qualified suppliers and purchases may continue. Suppliers that receive a score of 60-69 (D) or below are required to rectify given issues or propose plans for rectification within 45 days in order to go through the evaluation process again; existing suppliers that fail to score above 60 (E) in routine evaluation are required to submit an improvement report and rectify given issues within 2 months so that outcome of relevant rectifications can be verified through re-evaluation in 4 months. Suppliers who fail to make the rectifications shall be dealt with in accordance with YOKE’s procurement strategies. In December 2018, we re-evaluated a total of 14 suppliers and all 14 had passed the evaluation. Procurement strategies refer to adjustment in the Company’s purchasing intention and choice of sourcing; we shall either reduce the order quantity from problematic suppliers or remove them from our list of qualified suppliers.

0
the total number of suppliers that deals in business transaction with YOKE to 409 for the entire year.

Supplier Audit

The annual supplier audit focuses only on critical and non-critical suppliers and the audit is conducted in the form of a written review of their quality, price, delivery, and service (QPDS). Such audit takes place once a year and QPDS results of suppliers are reflected upon and discussed on a yearly basis. A supplier has to get a score of 65-79% (C) or higher at the same time to be qualified suppliers and purchases may continue. Suppliers that score of 64 (D) or under shall be identified as targets that require further on-site audit and assistance for rectification and will be required to address the situation within 2 months before the outcome of rectification is verified in 4 months. Suppliers who fail to make the rectifications shall be dealt with in accordance with YOKE’s procurement strategies. In 2018, we have reviewed a total of 225 suppliers and among them, 4 were found to be noncompliant. After on-site audits were carried out, we were able to verify that all 4 had implemented specific rectifications.

Collaborations

In order to improve the yield rate for materials purchased so that we can reduce the frequency of material return upon inspection (or the alternative of accepting said materials as special acceptance), YOKE has launch an initiative to boost material quality in order to shift the timing of anomaly discovery in the manufacturing management process further ahead in the hopes that suppliers will perform their FQC with diligence prior to delivery with the concept of preventive management in order to reduce NG deliveries. After selecting a key material, we created a list of suppliers QC inspection personnel so that we can offer relevant training for said personnel to ensure that both parties have adopted consistent approaches to inspection. This would also help to ensure the reliability of FQC results. In addition, YOKE will also assist suppliers with their management of tools and fixtures coupled with on-site audits to ensure that actual inspection practices are compliant to relevant operating procedures. In 2018, we set out to help one non-conforming supplier with the improvement and as of December, despite having made some improvements, the supplier was still struggling with quality consistency issues and we will continue to monitor this supplier in 2019. In June 2018 we assisted another supplier with extremely low NG rates as we hoped that by matching our inspection mechanisms and standards, we will be able to waive the incoming inspection process for this supplier. Prior to our assistance, the supplier’s NG rate had been at 0.31% and after our training and audit, we were able to bring down that number to 0.07%, with an actual improvement by 77.42%. We are scheduled to waive the incoming inspection process for this supplier over a probationary period in 2019. In 2019, we will also change our passive approach of preventing abnormal material incoming to a more proactive model of controlling at the source by incorporating new items or working with more suppliers in order to effectively improve our productivity and minimize resource waste. To improve suppliers’ OFR and yield rate upon delivery, YOKE has also been improving its feeding schedule - by implementing early production scheduling, we were able to prepare materials, design prints, equipment, outsourced processing capacity and so forth in the scheduling preparation. This allows our suppliers to directly inquire about their schedule for material delivery. In addition, based on the actual production progress, we have been making adjustments to our schedule on a weekly basis in conjunction with the delivery dates of end-products so that our suppliers can prepare their manufacturing and shipping in advance by referring to our latest schedule. In 2018, we included 17 suppliers in our feeding schedule improvement project. Prior to the project, our overall OFR for the selected suppliers in January 2018 was 87.83%, with only 3 suppliers managing to reach OFR of over 95%. After the implementation, the OFR for all selected suppliers in December 2018 rose to 93.48%, with only 3 suppliers that did not hit the target of 95% OFR. As the results and effects were evident, we plan to include 9 more suppliers in this project in 2019.

Clearly defined scheduling

Planning of materials, molds,
prints, equipment and manpower

Delivery date follow-up

Adjust supply/demand delivery dates
on a weekly basis according to
the most recent schedule

Anomaly feedback

Providing feedback on production anomaly
in time will often guarantees faster response

Greater appreciation

To take steps and make suppliers feel
they are appreciated and valued
as a way to incentivize them to
proactively respond.
yokelogo3.png

Safety is our first priority and
core CSR value


39, 33rd Road, Taichung Industrial Park, Taichung 407, Taiwan

Einfo@mail.yoke.com 
T+886-4-2350-8088

Follow Us

Copyright © 2018 YOKE Industrial Corp.

Design & Development By Chancer

Search

+886-4-2350-8088 

#39, 33rd Road,Taichung Industrial Park, Taichung 407, Taiwan