cal-8 Layered Process Audits Guideline 2nd Edition insight Expertise Results The Catalyst for Peak Performance | AIAG 2apoecal-8 AIAG 2a Layer Process Aus Te catabt pea peromance Version 2 Issued 01/2014 ABOUT AIAG Purpose Statement Founded in 1982, AIAG is a globally recognized organization where OEMs and suppliers unite to address and resolve Issues affecting the worldwide automotive supply chain. AIAG's goals are to reduce cost and complexity through collaboration; improve product quality; promote corporate responsibilly, health, safety, and the: ‘optimize speed to market throughout the supply chain, AIAG Organization vironment; and AIAG is made up ofa board of cractrs an executive decor, executives on lan rom membet companies, associate directors, a fulltime staff, and volunteers serving on project teams. Directors, depar program managers plan, direct, and coordinate the association's activities under the direction o director. 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(© 2014 Automotive Industry Action Group ISBN 978 1 60534-3006cal-8 a AIAG 2a Version 2 Issued 01 eetsa or poo goromarceCaQl-8 AIAG 2» Loyord Process Aus ‘Tre caaat pek patomarce Version 2 Issued 01/2014 FOREWORD ‘This guideline will help you utilize Layered Process Audit (LPA) as a tool to take your organization to the next level of performance. Atits core, LPAS are verifications that the most important standards and controls are in place. in a larger sense, PAs provide constant attention othe core processes ofan organization ~ by all levels of management. A well deployed LPA system drives a culture of accountability, process control and continuous impro vement. The result of this minimal efforts tighter alignment toward organizational goals — which isa key to success in this highly competitive global marketplace. Ifyou've implemented LPAs but consensus in your organization is that itis non-value added, this manual will help you see LPA in a new light. Debugging your existing LPAs should start questions on your check sheets. In Section 4 of the guideline, we share techniques for writing, value-add, rather than ‘classical” quality checks. Other aspects for fine-turning your LPAs ca you're new to LPAs, you can create LPASs that impact Key Performance Indicators (KPIs) s Cost, Delivery and Morale. Since reaching established goals for these measures is in the inter organization, it makes sense that all levels, or layers, of management participant in LPA deploy audits. ‘The critical success factors fora value-add LPA are addressed in ths revision of CQL-8 '® Top management support ‘* Communication of the value to employees © impactful audits we believe aspects of ith a review of the juestions that are thas Safety, Quality, tof everyone in an yment and on-going, be found in Section 6.cal-8 Layered Process Audis AIAG.» Version 2 Issued 0172014 acta er peo patemance ACKNOWLEDGEMENTS Bryan C, Book II Chrysler Group LLC Robert D. Francois III Johnson Controls, Ine. ‘Arun Prasanna Tenneco, Ine. Murray J. Sittsamer (Chair) ‘The Luminous Group LLC Neil Taylor Magna Exteriors & Interiors AIM SystemsAIAG macau pat zoramerce TABLE OF CONTENTS ABOUT AIAG. FOREWORD ACKNOWLEDGEMENTS on ‘TABLE OF CONTENTS. INTRODUCTION. 4.4. LPA Desinmion ano PURPOS 2 VALUE OF THE LPA MANAGEMENT TOOL. 2.4 How WILL LAVERED PROCESS AUDITS BENEFIT THE ORGANZATION?. 3 TOP MANAGEMENT PLANNING 3.1. LPA Process OWNER... 3.2 LPAPLANnne Team i 3.4 CuSTOMER-SPECIFIC REQUIREMENTS.. 3,5 PROCESS PRIORITIZATION. Sekine 3.7 DEVELOPING TEMPLATES FOR AUDITING AND REPORTING. 3.8LPA ProceouRe. 3.9 STAKEHOLDER BUYIN... 4 DEPLOYMENT... 4.1 LPA IwPLEMENTATION TEAM WoakSHOP... 4.2 Train THe AUDITORS, sn 4.3 COMMUNICATE THE LPA ROLLOUT TO THE PROCESS AREA. 5 CONDUCTING THE AUDIT. 5.1 CONDUCTING THE AUDITS AND RECORDING THE FINDINGS. 5.2 OBSERVATIONS AND PERSONAL INTERACTIONS. 6 TOP MANAGEMENT REVIEW AND CONTINUOUS IMPROVEMENT OF LPAS... 6.1 ToP MANAGEMENT LPA REVIEW oo 6.2 CONTINUOUS IMPROVEMENT OF LPAS... APPENDIX A.- WHAT IS LPA2.. [APPENDIX B - RASIC [APPENDIX C— FREQUENCY OF AUDIT BY LAYER wa vnsnsnansnsnn APPENDIX D - AUDIT SCHEDULE. [APPENDIX E- EXAMPLE CHECK SHEET. [APPENDIX F- REPORTING EXAMPLE APPENDIX G - GLOSSARY Layerec ve CcaQl-8 i Process Audits sion 2 Issued 04/2014cal-8 Layered Procest Anciis AIAG» 7 Version 2 Issued 01 Tro car past pornsAIAG.» caQl-8 Le Process Audits aca brpocorominee ove gn 2 wee 0014 1 INTRODUCTION 1.1 LPA Definition and Purpose Layered Process Audits (LPAs) are management tools used to verify that work is done ‘established standards, to emphasize the importance of those standards, and to identify continuous improvement. LPAs can be applied to verify any defined process within a process is the methodology and controls used to create a product or service. Some as are Machines/Equipment, Materials, Methods, Manpower, and Measurement. ‘Nonconformances such as costly recalls, warranty issues, and customer and employee according to ypportunities for ‘organization. A jects of a process dissatisfaction are often caused by poor process control or by failure to follow the process instructions. Employees often complete process steps ftom memory. When necessary process changes are identified re-learn and adjust. It is very easy to return to the old, familiar methods, LPAs are a structured way to verify that work is performed as originally intended, res performance metrics. Because LPAs are conducted at the location where the process is also facilitate ongoing two-way communication between management and the process interactions strengthen trust and demonstrate shared ownership in the work being don ‘The Layered Process Audit is actually more ‘verification’ than ‘audit.’ A Layered Pre that controls are in place and the standard process is being followed .. . and followed LPA is not a control but a verification of a control, it does not belong in a Process Cor When defining Layered Process Audits, it often helps to explain to personnel of al lev Process Audits are and also by explaining what they are not. The “is/is not" tool is re employees must ting in improved being used, LPAS users. These right. ess Audit verifies rectly. Because trol Plan, yels what Layered nized in many problem-solving disciplines. This has been applied to Layered Process Audits in Appendix A.CaQl-8 Lajre Process Au AIAG.» Version 2 Issued 01/2014 The cat t pra peromerce 2 VALUE 2.1 How Wi Effective Layered Performance Indi OF THE LPA MANAGEMENT TOOL Layered Process Audits Benefit the Organization? rocess Au provide management with verification of process conformance, identify tors (KPIs). These outcomes can have a direct impact on the quality of the product the areas of potential i variation, and provide opportunities for continuous improvement of Key organization ships the customer, Ultimately, the improvements to the organization will have a positive impact on business results. ‘When applied effectively, Layered Process Audits can provide specific benefits, including the following: Mitigating safety incidents (injury, near- accidents, lost time, etc.) Reducing waste Improving cash flow Improving product quality and customer satisfaction Reducing quality incidents (errors, scrap, rework, ete.) Increasing First Time Capability Measuring and encouraging work process standardization Reinforcing key or updated process steps, including safety requirements Increasing interaction between plant management and line operators Allowing first hand feedback from operators to plant management Enabling management to implement corrective action and pursue continuous improvement Institutionalizing training and process knowledge Reducing the overall cost of poor quality While these are ‘ype benefits of Layered Process Audits, some might not be applicable to every organization. Con! become apparent. , as an organization implements Layered Process Audits, additional benefits maycal-8 AIAG 2m Benes Tha cata pak prance sion 2 Issued 01/2014 3 TOP MANAGEMENT PLANNING Innearly every case, the most effective Layered Process Audits are those that are carefully planned rather than hastily put together without a clear direction, A cross-functional approach to planning, with the involvement and support of management, is critical to the success of any LPA program. When planning an LPA program, there are several things that need to be considered: 1. LPA Process Owner — What individual will be responsible for the LPA program? Who ensures that the audit is conducted and that the results are reviewed and acted upon? 2. LPA Planning Team ~ What departments and individuals will need to take part in planning the LPA program? LPA Scope ~ What areas or processes will need LPAs conducted? Customer-Specific Requirements ~ What customer LPA requirements should the team be aware of when developing the LPA program? 5. Process Prioritization ~ What areas or processes show the biggest opportunities for improvement? Which LPAs should be implemented first? 6. Audit Layers ~ What levels of the organization will be involved in conducting the LPAs? 7. Development of Audit and Reporting Templates ~ What will be the format for conducting the LPAs? For reporting results and actions? 8. Developing Metrics for LPA Effectiveness - What metrics or indicators will be monitored to ensure the LPA program is effective? 9. LPA Procedure ~ What needs to happen in order to implement the LPAs? Who will do that? ‘What formats and report formats will be used? 10, Stakeholder Buy-in — Are all of the involved departments committed to the LPA program? Is, there Top Management support and commitment? How is this support and commitment demonstrated? 3.1 LPA Process Owner A single individual from Top Management should be assigned overall responsibility for the Layered Process Audits. This individual serves as the program lead and is responsible for the following: ‘© Obtaining audit results and records from each area of the organization; ‘+ Ensuring that responsible individuals have developed corrective actions for issues and implemented them according to schedule; ‘© Reporting to Top Management on the status of LPAs and implemented actions, ‘+ Ensuring that LPA results and actions are communicated throughout the organization; ‘Facilitating the addition of new processes to the LPAs; ‘* Creating, maintaining and updating, as required, the LPA procedure(s), templates, and schedules. Because Layered Process Audits are not simply another audit to be carried out by the Quality Department, the LPA Procsss Owner ole docs not ned ip automaticaly belong tothe Qualy Marge Ia fc is recommended that the organization’s Operations (e.g., Manufacturing) Manager be designated as the LPA Process Owner.= 10 CaQl-8 Layered Feacest hace AIAG Version 2 Issued 01 4 ect ep peromarce In addition to the L LPAs must take 0 3.2 LPA PI. ‘The LPA Process. Audits. A cross-fi organization’s deps areas include but a ”A Process Owner, the manager in each area of the organization that performs the ership for their area. They will be responsible for ensuring: LPAs are conducted on time, LPAs are conducted by the designated team members. Corrective actions for issues in their areas are developed and implemented on schedule. ‘The department results are recorded and reviewed regularly. Resources are available and focused on corrective actions for the nonconformances identified, ining Team }wner should assemble the Planning Team to begin developing the Layered Process tional team should be created, with participation from—at a minimum—all the ents and levels that will be affected by the Layered Process Audits. Suggested not limited to: Operations / Manufacturing Production Control Human Resources Engineering, Maintenance Sales / Finance Quality Supply Chain ‘Material Control Any other department or area affected by the LPAs 3.3 LPA Scope ‘As mentioned previ to established stands continuous improv: characteristics: sly, the purpose of a Layered Process Audit is to verify that work is done according, 1rds, to emphasize the importance of those standards, and to identify opportunities for ent. Processes included in Layered Process Audits should have the following Be in their final state (i.e, not under development). Layered Process Audits reinforce existing processes and requirements and are not intended to develop pilot or draft processes. Fully documented, including work instructions, control plans, ete. Layered Process ‘Audits check to an established standard. Be approved processes, either by customer or by management Be critical to customer satisfaction, satisfying government regulations, or the performance of the organization. Layered Process Audits performed on low-riskcal-8 AIAG» Layered Process Auta Tecaobt or peat geomarce me son 2 Issued 01/2014 processes will have a correspondingly lower impact on the organi performance. The first action the Planning Team should take is identifying those areas and processes zation’s that will be considered for inclusion in the Layered Process Audits. Using the above criteria, the Planning Team is encouraged to consider manufacturing areas, non-manufacturing areas, and support functions. The general rule should be “If a process is critical to the performance or functioning of the organization, check it.” On the other hand, trying to include everything in the organization would likely reduce th effectiveness LPAs’ Note that in no circumstances does a Layered Process Audit replace internal or third party management system audits 3.4 Customer-Specific Requirements The Planning Team shall review and adopt Customer-Specific Requirements for the Layered Process Audits. These can include specifications on frequency, participation, and scope, as wel developing the Layered Process Audits, the Planning Team should review the specific. ‘These should serve as program “minimums.” If the Planning Team is unclear on whi as others. When requirements for to obtain these each customer they interact with and ensure that all such requirements are cri into the program. Customer-Specific Requirements, they should contact their designated customer re direction or clarification. 3.5 Process Prioritization With the scope defined and Customer-Specific Requirements identified, the Planning on priorit should review each process’s performance to see which ones are causing problems of and/or frequency. Some examples of items to look for when prioritizing processes for ‘Audits inelude but are not limited to: ‘© High number of safety incidents / injuries ‘© High number of customer complaints or quality spills from the ‘* High-risk or high-severity items from the PEMEA © High scrap rate / low First Time Capability (FTC) ‘© Low machine efficiency or high downtime / maintenance ‘* Process runs longer than originally intended (e.g., process was ex} shifts a day for 5 days but instead is running 24 hours a day 7 day: Ultimately, certain factors will always make a process take priority over others when Layered Process Audits. Whenever a process is identified with one of the following ct should receive a higher priority: © Customer has mandated a Layered Process Audit. sentative for ‘eam should focus ing which processes will have Layered Process Audits developed first. The Planning Team 1e highest severity the Layered Process gees pected to run 2 aweek) veloping the acteristics, it ‘Process has caused a critical quality issue for one or more customers (such as stopping the shipment of a product or resulting in a warranty fiel Process is regulated by government standards, especially safety or ‘campaign). environmental. ie-12- i AIAG = Version 2 Issued 01 4 To cata tr pst peromance 3.6 Au Process is critical to the functioning of the organization (i.e, the plant could shut down if the process fails). For example, material management and tool maintenance, ete, Layers A Layered Process Audit gets its name from the requirement that multiple "layers" (e., personnel at various levels) of a that is typically cor is conducted by the organization's st organization will organization becau: have new insight t Supervisors, team I however, the organi Audit places peopl: items. This facilitat Layered Process At very important. In schedule, When higher levels ‘organization conduct the audit. Unlike an audit of a product characteristic or feature jucted by an operator or a quality department team member, a Layered Process Audit connel ranging from working-level team members to personnel at the highest levels of icture, The Planning Team should determine what levels of management in the required to take part in the program. Auditors should come from every area of the someone unfamiliar with a process will tend to objectively review evidence and can how itis working and/or how it should work. See Appendix C for an example. iders, department managers, and Top Management should all conduct LPAs; ization’s top manager within the facility shall always take part. A Layered Process cof multiple levels of the organization where the work is being done to verify critical s communication between management and the working-level team members. The dit also demonstrates to all team members that these designated, critical items are ‘ome organizations, visiting corporate executives should be included in the LPA of the organization are involved with verifying conformance to standards through interaction with front-line employees, this drives home the message that conformance to standards are ‘important and the sponsibility of everyone in the organization. 3.7 Developing Templates for Auditing and Reporting The Planning Tear should obtain or develop the standard templates to be used for the Layered Process ‘Audits, This will ensure consistency across each department / area and prevent uncontrolled documents from being used. TI the templates that actions will follow that document. Once developed, th processes. They sh rocess owners, su responsible for mai 1¢ team should develop templates for LPAs to be performed in the organization and, ill be used for reporting LPA results. In addition, they should ensure that corrective 1 organization’s Corrective Action process and use the same format as detailed in templates should follow the organization’s Document Control and Record Retention ld be stored in a location that is known and accessible to all of the area-specific asa centralized database or web-based location. The LPA Process Owner is taining and updating the templates, as required. Examples of LPA templates are shown in Appendices E & F. 3.8 Developing Metrics for LPA Effectiveness Layered Process A\ case of nonconform: its (LPAs) are more effective when their output is carefully monitored and, in the inces, corrective actions are implemented. Initially, itis helpful to monitor and report conformance to set audit schedules. This will help establish accountability for those assigned toAIAG Layore cal-8 Process Audits Te cata eps etomance ‘Version 2 sued 01/2014 conduct the audits. As the LPA system matures, the focus will shift from reporting au monitoring the effectiveness of the LPAs. LPA reporting might include the following in Table 1: ‘Table 1: Sample LPA Metrics lit events to WET) Measures Percent of Audits completed (by Layer) _ | Implementation of the program and assigned LPA priority Percent in Conformance (by Area) Percent of items checked that were observed to be in conformance with defined work standards, settings, methods, technique, ete. Corrective Actions completed (by Area) | On-time completion of Corrective Actions Repeat Non-Conformance in LPA Effectiveness of Corrective Actions (e.g. 8Ds) KPIs (see section 2.1) Effectiveness of the LPA program (e.¢., effect on operating metrics) (See Appendix F for an example) 3.9 LPA Procedure ‘The Planning Team should document the LPA process in a standard “LPA Procedure.’ the LPA Procedure, the Planning Team should consider all of the following: ‘* Conformance with Customer-Specific Requirements, When developing, © Roles and Responsibilities (e.g., an organizational RASIC — see Appendix B) ‘* Documenting and Implementing Corrective Actions ‘+ Management Reporting ‘+ Training Requirements and Records The LPA Procedure should also include or make reference to the following forms: '* Process Prioritization List-M4- Cal-8 Layered Proces: Version? Issued 01 ‘The LPA Procedt accessible to all le uss AIAG 4 ecto te peak peromaree Schedule Template Check sheet Template Reporting Template should be a controlled document that is approved by Top Management and made 1s of the organization as needed. 3.10 Stakeholder Buy-in The Planning Team stakeholders shoul developing cor ‘them are completed shall ensure buy-in from all stakeholders of the Layered Process Audits. All commit to follow the process by performing audits as scheduled, reporting results, e and preventive actions for discovered issues, and ensuring those actions assigned to by their target due dates. At a minimum, buy-in shall come from: ‘The LPA Process Owner ‘Management of each applicable department Planning Team members ‘Top Management (including the top manager in the facility) Corporate Management Without this buy-in, there is a strong likelihood that the Layered Process Audits will not have the support they need to provide true benefits to the organization,Ccal-8 AIAG» Layered Process Aus ‘Mecatayt tr peakoeromarce Version 2 Issued 01/204 4 DEPLOYMENT After Top Management planning is completed, each process area can take the lead on used in their area. For that purpose, each process area that will adopt LPAs should fo ow LPAs will be rm an ad hoc Implementation Team. The primary deliverable of those teams is a process-specific LPA check sheet. It is most helpful if'a member from the Planning Team works as part of each Implementation Team to provide consistency and a wider knowledge of LPAs. LPAs provide maximum benefit Managers take direct responsibility and become involved in their implementation. ‘The Implementation Team for each area might be composed of: ‘* The area or process manager/owner ‘© Associate(s)/staff who work in that area Each process area is unique and will have its own best opportunities for LPA verificat Organizations might find that similar process areas will have similar questions. This when Area ions, juld be helpful in accelerating question development, but be sure that the base question template is composed of verification questions that are effective in improving results (KPIs). ‘When implementing LPAs in each process area, consider using the following procedure: 1) Conduct an LPA Implementation Team Workshop a) Present an overview of the LPA process and its benefits b) Explain the target KPI metrics for improvement ©) Develop audit check sheet questions 2) Train the Auditors 3) Communicate the LPA Rollout to the Process Area 4.1 LPA Implementation Team Workshop 4.1.1 LPA overview Each Implementation Team should get an overview of the LPA management organization's LPA procedure. This will educate the team on the intent and. Participation of the Top Management group in the training should be encou tool and of the ‘mechanics of LPA. iged because it will reinforce the importance of the strategy and enable management to ensure that each area is ‘committing adequate resources. 4.4.2 Target KPI metrics for improvement Once an area’s Implementation Team is trained, they should assess what Key Performance Indicators (KPIs) ot performance measures need the most improvement. wo LPAs often are applied to improve Quality (scrap, ppm, FTC, etc.) they can also be used to (accidents, lost days, near accidents, etc.), Delivery (downtime, days late, metrics. While LPAs are often used to drive improvement in a KPI, LPAS c ‘maintain a KPI that is performing well. idress Safety ), and other mn also be used to -15--16- CcaQl-8 Layered Process Aulis AIAG Version 2 Issued 0172014 he clss erpooparomarce 4.1.3 Develop audit check sheet questions One of the most critical elements of LPA implementation is defining the questions which will go into an area’s LPA check sheet. A check sheet is composed of a series of questions, each with an associated explanation of why that question was selected and a nonconformance reaction plan. ‘Table 2. Format of Audit Check Sheet Questions Question Explanation Reaction Plan iat/Where/How to | Why the question was | How to react if'a check selected nonconformance is found LPA check sheets are used to audit a specific process, not product, to ensure it is free of ‘unwanted variation that could negatively affect the area’s selected KPIs. That said, itis not reasonable to verify all aspects of a process every day — there just isn’t enough time. ‘Asa general rule of thumb, a Layered Process Audit in an area should take 10 to 15 minutes (5 to 15 questions) per shift, every day. When a process is more complex, or has more sources of uncontrolled variation (e.g,, manual assembly), then the LPA may require additional time and questions, ‘Question Creation: LPA check sheet questions should focus on process areas and not involve looking at parts for otental defo, The focus ofan LA iso verify that defined process controls aren place and the proce is working as designed. LPA questions should be written to verify what is happening in real time. LPAs take a snapshot ‘of what is actually occurring compared to what is expected, Each question should be specific and meaningful to the process being audited, Before generating questions, review relevant risk aspects from the Quality Management System (EMEA, 8D/NCR, Customer Concems, Control Plan, Error Proofing verification, Lessons Learned, etc.). These are excellent inputs to help the Implementation Team identify the risks and pin point the cause mechanisms that should be verified in the LPA. ‘When developing check sheets it is recommended to consider the following questions: ~ To what extent could the process element or setting vary? ~ How frequently could the process element or setting vary? — What aspects of the process element or setting are least robust? = If the process element or setting varied, how significant would be the impact? ~ What process element or setting might negatively affect safety or regulatory requirements? ~ If the process element or setting requires error proofing, is the device functioning effectively today and when was it last checked? tions should avoid terms such as ‘proper,’ ‘correct,’ ‘accurate,’ and ‘appropriate* itis not possible to verify a ‘proper’ setting without knowing the specifications and tolerances for the setting.CcaQl-8 AIAG Process pe Layer ‘recor tesen 9nd ovata All audit question responses should be: Yes’ or ‘¥* for conforming "No’ or *X’ for nonconforming ‘The development of LPA questions should use objective criteria such as machine settings, detail in work instructions/standard work, error proofing verification, or specific customer requirements. LPAs are intended to verify general work elements that have a direct impact on quality or are likely to vary day-to-day. Examples include: «Instead of asking “Is the operator trained?” verify that the operator is performing the task according to the established standard/instruction. If loading a part incorrectly is known to cause scrap, a LPA question would validate the operator’s technique vs. the standard, * Instead of checking to see if Quality Alerts are posted, write LPA questions to verify that the content of the instruction is being practiced at that moment of the audit. * Elements that are not likely to vary suddenly or covered in other audits (e.g,: calibration status, training status) do not add value to an LPA. ‘Question Explanation: ‘Many times auditors are not aware of a questions purpose or expected answer. To provide clarification to auditors, itis recommended each question have a defined purpose and an expected response. Answering the “Why?” about a question also verifies the value of the question and its relationship to KPIs, controls, and the process. For example, the question may be related to an ongoing warranty issue or to a variation in an associated technique that led to a significant scrap issue in the last quarter. ‘Question Reaction Plan: Questions should also have a reaction plan defining what to do as the first response if the item is found to be nonconforming. If the check sheet item is found to be nonconforming, the auditor should follow this pre-established reaction plan to prompt the responsible individual to correct the situation. If the nonconformance found creates a suspicion of nonconforming product downstream from the current operation, the responsible individual may take the decision to require containment and sorting to protect the customer and then initiate corrective action analysis Question Fine Tuning: After the questions are drafted, they should be reviewed with the Planning Team and tested with one ot two auditors conducting the audit in the process area, Their feedback should be used to fine tune the wording and often make the questions even more effective in detecting nonconforming situations. -17--18- CQl-8 Layered Proce: Version 2 issued 017 ucts AIAG» in ‘me caaat roe parorance 4.2 Train the Auditors Layered Process A\ allows multiple set consistent surveill LPA auditors don of conducting an a Specific Requirem¢ LPA management the area(s) they may its are generally performed by people who may not have had auditor training. This of eyes to verify processes from different perspectives. LPA auditors provide we and regular feedback to the facility’s Top Management. need extensive training, but they do need to be oriented to the intent and mechanics dit. Training content may be taken from this document and from applicable Customer- ts related to LPAS. The best way to train auditors is with a brief overview of the 01 followed by practice audits with experienced mentors, using the check sheet for be responsible to audit. Records should be kept to show evidence that auditors understand and can apply LPA concepts 4.3 Communicate the LPA rollout to the process area As LPAs get imple employees in those in areas that will being audited, not ti before, but now per ‘machine parameters Afier LPAs are imy with areas that are ented in different areas of the organization, management should communicate to reas the objectives of the LPA and how it might affect them. Employees who work audited should know that they don’t have to do anything differently; the process is ie people. They continue to work according to standardized work instructions as jodically, different LPA auditors will be coming around to verify work technique, , and other process elements that are important to quality and other KPIs. lemented in the first few areas, success stories about improvement should be shared considering how and where the LPA tool will help them.AIAG The clas pol paromencs caQl-8 Layered Process Audits on 2 Issued 01/2014 5 CONDUCTING THE AUDIT Once the audit questions, nonconformance reaction plans, audit layers, and audit freq lencies have been determined, the trained auditors can begin conducting Layered Process Audits. A significant part of the audit process is ensuring that the audits are performed according to a schedule and that the results of the audits are recorded. 5.1 Conducting the Audits and Recording the Findings ‘When conducting an audit, the assigned auditor should follow these steps: 1. Check the LPA schedule for audit assignment: date, time, process area. 2. Obtain the appropriate LPA check sheet (e.g., from person, physical, or server 3. Review the audit check sheet--before going to the area~+to be familiar with th changes to the questions, and the evidence that you will be verifying. location). questions, any 4, All layers should verify the layers below them are current with their recent required LPA checks. Perform the audit according to the questions on the LPA.check sheet. Be sure relevant header information, 6. If the response to an audit question is “Yes,” document it as such and then the ‘on to the next question, 7. Ifthe response to an audit question is ‘No,’ then the auditor has found a nonc 0 fill out all uuditor will move formance that requires corrective action as defined in the Reaction Plan. In the Comments section the auditor should include any observations regarding the nonconformance. 8. The check sheet will provide the auditor with a reaction plan to follow if a nor .conformance is found for that question. If the problem is corrected during the audit, then actions taken are recorded on the check sheet, The issue is still recorded as a nonconformance corrected and added to the management summary. 9. Repeat issues may be a sign that there is a systemic issue that needs to be adc 10. If the issue was not corrected, then it remains open pending a corrective action. 5.2 Observations and Personal Interactions The implementation of Layered Process Audits provides a unique opportunity for obs being audited by individuals whose day-to-day tasks may not include interaction with sven though it is sed. srvations of the area e areas audited. These observations can be opportunities for improvement. Auditors who normally do fot worn aa ren can often see things that the frequent visitor overlooks. Auditors should be encourage observations on the Layered Process Audit check sheets. Layered Process Audits also provide an opportunity for interaction among individuals. create a mote cohesive environment among employees, departments, and management Finally, even when no nonconformances or observations are found, all LPA auditors-i to include these This tends to including Top ‘Management--provide value by acknowledging people’s effort in following standard work. It is advisable that auditors provide positive feedback to the individuals with whom they interacted, with positive feedback reinforces the message that everyone is responsible for good m: practices and provides motivation to drive continuous improvement. ‘Leaving people wnufacturing -19--20- Cal-8 Layered Process Version 2 Issued 01 suas AIAG 2» 14 Theat peak paomarce Positive feedback ii people. ‘An Example of a ‘a way to let employees know that LPA is intended to support the process and the ympleted check sheet is in Appendix EAIAG.» ‘a xa peat ceremares CcaQl-8 Layered Process Audits Ve son 2 Iesued 01/2014 6 TOP MANAGEMENT REVIEW AND CONTINUOUS IMPROVEMENT OF LPAs 6.1 Top Management LPA Review ‘Top Management should conduct reviews of the LPA at planned intervals. These revi s will reinforce to the employees Top Management's strong focus on LPAS and allow management to mile adjustments quickly, if needed. It is the responsibility of Top Management to review LPA metrics, assess what's working well and what's not working well, and adjust LPAs as needed Performance Indicators (KPIs). Additionally, these reviews will provide objective evi Quality Management System and Customer-Specific Requirements for review of audit LPA Review should: © be part of regular operational/quality review meetings © have a standardized agenda of review points see Table 1), improve Key lence to support results. © review actions assigned at the last review, and verify effectiveness of competed actions * review data/metrics ( LPA metrics and organization KPIs) - trends, repeat issues, LPAS. updated/teviewed to address top internal issues and all customer concerns # develop actions to address issues and continual improvement based on the data. ‘© assign actions (individual ownership and deadlines) Outcomes of the Management Review of LPA should: ‘+ remove all barriers to effective LPA implementation, ‘© _ prioritize resources to leverage value from LPAs ‘* expand LPAs to other areas ‘+ reassess targets for continuous improvement of LPAs, ‘® document continuous improvement as a result of LPAS 6.2 Continuous Improvement of LPAs ‘After assessing the metrics and effectiveness of the LPA program, management shoul LPAs to address any weaknesses and opportunities for improvement. Typically, weab opportunities for improvement that should be addressed include: * Lack of management review or lack of full support by Top Management * No consequences for not conducting audits Check sheets too long or cumbersome © Questions that do not address the sources of process variation reviewed consider adjusting esses or -21-CaQl-8 Version 2 Issued 0 ia Tho cata psa zrerance + No feedback to operators * Not grounded in daily routines * Disciplined * Not dynami are covered problem solving not being used to get to the root cause of problems found cally assessing risk (e.g.: FMEA, Customer Scorecard, KPIs, etc.) or ensuring they in PAs,AIAG Tecateat tr paatgeomarce cal-8 Process Audits jon 2 Issued 01/2014 APPENDIX A - WHAT IS LPA? Terie ooy Cleric Terr anereee Neila: 1. Verification that processes and procedures are being | 1. A quality audit of part characteristics. followed. 2. Owned by the operational group where the audit is | 2. Owned by any support group, (¢.g.: Quality). conducted, (e.g.: Manufacturing). 3. Conducted by multiple management levels of personnel ina given facility. 3. Conducted only by an inspector or lab technician, 4, An audit consisting of quick, typically yes/no, questions. ee ee fae 5. A short list of key and high-risk processes, process steps, and procedures. 5. A long “laundry list” of items that include items not Contributing to customer satisfaction. 6. Completed on a regular, pre-determined frequency. 6. Completed whenever the auditot has spare time, 7. Completed by the person identified in the audit plan in each layer of the organization, 7. Allowed to be delegated by the co persons. (e “where the work is done.” 8. Completed on 8, Completed inthe auditor's office. 9. A method to verify and sustain corrective actions related to process 9. A method to determine corrective actions. 10. A method to verify that quality documentation (instructions, control plans, etc.) is being followed. 10. An inspection method to add t plan, the process control 11. An audit with results that are reviewed by site leadership on a regular basis. 11. An audit with results that are filed away and not reviewed. 12. An audit where non-conformances are addressed immediately, 12. An audit where non-cor addressed at a later time or ater a been accumulated 2s are noted and tain number have 13, An audit typically planned for processes and procedures conducted by people. 13, An audit to validate the oper ‘ofa machine, 14. A method to facilitate communication between operators and management. 14, A method to identify the worst employees. 15. A method to stress the importance of complying with processes and procedures. 15. A method to show personnel + “we're watching you. 16. An audit of selected processes and procedures / steps. 16. A replacement for internal Quality Management System (c.., ISO/TS 16949) audits. -23-cal-8 Layered Process Acts AIAG 2» Version2 Issued 01/2014 The calaat peat paomarcs APPENDIX B - RASIC Layered Process Audit Steps ‘Team Member's 1 osgnte PA Proms Ones forhe Sar ident te BAP ming Tm 1 1 {Depth PA Proce adios 1 7 erlop nye Pacs ci ed 1 ‘Tainan on PAs At Gt at 1 aes Perna i ela 1 1 1 1 1 1 ¢ Ste Top Managemen 7 Devlop an A lnplerenaion schedule 9 Deep nd inplement cqrerive scone Tikeadedreter Agus nec we Ti eee cress >l>|>|> 12 lp porn ele BBFC dao 1B ic Top mgr th Map fel, Pearse err ral ees of PA pet eon ae ior adres ote aT Ia > ie Repanie The prsn who inst repparaie or debe ak [cent [acura Te person whos imate santly dap ao tne revew nd sure qultyan rete person to whom “sects [= Svnportve-The team or eso] supporting the ea work wt esoues, ime or xr materi bane They are commited tos meen [ncrmee- Those who provide pt and mt Be oreo resus or acre [ten ute not veain na ddion mating [conned thse who prove auate pu The buyin sinter sues molemertatinAIAG» ‘a cat pes patemance caQl-8 Layered Process Audits Version 2 isu 01/2014 APPENDIX C —- FREQUENCY OF AUDIT BY LAYER ‘ee Maren feme Automotive Audit Assignment Mh T T eesti ! 1 : | I pacer pre aoe goad sue feos, fer tite | | OG J [ist Layer of — Supenisces 1 I JManagement | 1 eemies omer neon fowoe| || pt ! I oe Meet havo | oy I Superiace 3 Own Dept I VW pershit 1 per shit I I ‘Nee Manager Own tes ‘Ne Marapor2 Own Area ets par work > thar ets 1 i C Pant Saad t Pre Mnee” crgrg tar Raat Darts. | 1 apt per weak ty Mor Reales. | 1 dpe prwek Tosinggr — Rea Ons, | 1 pra L HRW Rotte om | 1 et pe \ 1 eateeiiemalll 1 eet er weak H Perm fee 1 dot pr week Vitra T feesetene) readies eum DATIIML |c_ayatr a ai it paat ——> Notas ton ste -25-cal-8 Layered Process Aulis AIAG \erton' sued ova aca raece APPENDIX D - AUDIT SCHEDULE Acme Automotive LPA Staff Level Audit Tracking Form Week of July 19 Folng 8 wock schedule (erop and eda four weeks every mont) ‘Aucit Frequency Requires Layer 3 Staff Member ‘Sue, Plant Manager 4 per week Marco, Controller 4 por wock (Gene, HR 1 por week (Claus, Purchasing ‘per week uu, Engineer 11 per week ‘Arun, Quality 41 per week Total Plant Chocks forthe weak 6 6 6 6 6 6 = Incomplete Audit Completed AuditAIAG ‘ecatajet peat oeromarcs APPENDIX E - EXAMPLE CHECK SHEET ‘Acme Automotive LPA Process Control Audit Poem Une, Dopt E Ccal-8 Process Audits jon 2 Issued 01/2014 Wook Beginning: ay 18 ‘shit_ rama cece: ere oe (Hae sar [esnta crit rater [ec han [te sway he yen npr bay poeta [pegmice pert errata? pact Hae pri rr a ee ethan 2 7 -27--28- cal-8 Layered Proces: Audits 14 AIAG Version 2 Issued 01 ‘Macatee pant gotorance APPENDIX F —- REPORTING EXAMPLE Layered Process Audit Results a ____ 2013 _ Annual In Compliance Non Conformances| in complaes| $0.2 HOTA Audis “ata rat kame Aust Bof tems in Compliance Non conformance ‘Non Conformances ‘Customer Conor al Setup Pot Ye ‘Sperstoristrutone Calbraone lefelefefelefololele fa lalsla Jollee fn foofa ofan Packaging YIIIIIIIIIIIINIIIIIIIIIII’ YYIIIIIID i) )AIAG Loyal CcaQl-8 Process Audits cals er pen zaemance Version 2 lesued 01/2014 APPENDIX G - GLOSSARY Audi objectively to determine the extent of which audit criteria are fulfilled. Conformity: Fulfillment of a requirement Corrective Action: Action to eli situation. nate the cause of a detected nonconformity or otf > NOTE: Corrective action is taken to prevent recurrence whereas preventive ai prevent occurrence. Customer: The recipient of the organizations or supplier's product or service. Error Proofing: Refers to any devices and practices that prevent a failure mode fro First Time Capability: Measures how many goods are produced correctly without percentage of total units produced in a production process or value stream. This concey applied to the service industry as a measure of service or orders delivered satisfactoril first time without any amendments, re-work, or complaints. Organization: Group of people and facilities with an arrangement of responsibilities, relationships. Performance Indicators: Key Outcome Indicator: KOI’s are metrics that are tied have at least one defined time sensitive target value and have explicit thresholds” whi between the actual values and the target. > Key Performance Indicator: KPI’s are those metrics most critical to gauging pr objectives. Kls are metrics that are tied to an objective, have at least one defi target value and have explicit thresholds which grade the gap between the act > KPU/KOI Scorecard: A specific application of a scorecard, a KOVKPI scorec: ‘measure progress toward a given set of KPIs ot KOIs. Predictive Maintenance: Activities based on process data aimed at the avoidance problems by prediction of likely failure modes. systemic, independent and documented process for obtaining audit evidence and evaluating it er undesirable tion is taken to occurring. Jaws or re-work as can also be easily to customers the authorities and an objective, grade the gap ygression toward ed time-sensitive ial and the target. dis used to if maintenance -29--30- Ccal-8 Lore Pees ct AIAG Version 2 tssued 017 4 Tr catat peo patemarce Preventive Action Action to eliminate the cause of a potential nonconformity or other undesirable potential situation, > NOTE: Pr taken to pr -ventive action is taken to prevent occurrence whereas corrective action (3.6.5) is vent recurrence. Predictive Maintenance: Planned action to eliminate causes of equipment failure and unscheduled interruptions to prot Procedure: Speci luction, as an output of the manufacturing process design. fic way to carry out and activity or a process Process: Set of interrelated or interacting activities which transform inputs into outputs, Product: Refers t Quality: Degree t > NOTE: “h permanent Requirement anything from a fu diameter must mea physical objects or services produced by the process. which a set of inherent characteristic fulfils requirements. erent”, as opposed to “assigned”, means existing in something, especially as a haracteristic. specific requirement of the customer receiving the product. This requirement may be tional characteristic (e.g., spins freely) to a specific, quantified characteristic (e.g. wre 10-15mm) Stake Holders / Interested Parties: Person of group having an interest in the performance or success. of an organization. Supplier: Organiz ‘Top Management Validation: Confi tion or person that provides a product. + Person or group who direct and control an organization at the highest level. rmation, through the provision of objective evidence, that the requirements for a specific intended use or application have been fulfilled. Verification: /ding of objective evidence that a given item fulfills specified requirements.AIAG 2» Layers "a cataet ern potomanes ve cal-8 id Process Audits sion 2 Issued 0172014 | MAINTENANCE REQUEST FORM Name of Submitter: Date: Company: Company Address: Phone: Fax: E-mai NEN elites Page Number of Change: Document Currently Reads: Recommended Changes/Should Read: Reason for Change (Use additional sheets if necessary): Signature of Submitter: PS Kck sxe aa) Manager's Recommendation: Final Disposition: Comments: [erence ‘Automotive Industry A¢ Telephone: MONEE a eee yn Group + 26200 Lahser Road + Suite 200 + Sout (248) 358-3570 + Fax: (248) 358-3253 Web: www.aiag.org tion. field, MI 48033 -31-