SAEP_85

Engineering Procedure SAEP-85

14 November 2017

Suppliers Assessment and Approval Document Responsibility: Responsibility: Project Quality Standards Standards Committee Committee

Contents 1 2 3 4 5 6 7 8 9 10

Scope................................................. ................................................................ ............... 2 Conflicts and Deviations Deviations ................................... ................................... 2 Applicable Documents ...................................... ...................................... 2 Definitions Definition s and Abbreviations ............................ ............................ 3 General .................................................. ............................................................. ........... 4 Registration Registration and Workflow Creation.................. 6 Screening................................................... .......................................................... ....... 7 Manufacturing Manufacturing Plant Assessments Assessments .................... 9 Reporting Manufacturing Plant Assessments . 10 Support to Newly Established Local Manufacturers Manufacturers ................................................ .................................................. 12 11 Approval Process Finalization Finalization ......................... ......................... 13 12 Approved Suppliers Maintenance ................ ........ ........... ... 13 13 Roles and Responsibilities Responsibilities .............................. .............................. 15 14 Exhibits .................................................. ........................................................... ......... 20 Revision Summary ............................ .................................................. ...................... 20 Exhibit I: Assessment Assessment Request Matrix ................... ................... 21 Exhibit II: Manufacturing Plant Assessment Assessment Process Map in SAP.................. 22 Exhibit III: Vendor Compliance Compliance Letter .................... .................... 23 Exhibit IV: Vendor Acknowledgement of Assessment Findings Form ......................... 24

Previous Issue: New

Next Planned Update: 14 November 2020 Page 1 of 24

Contact: Megren, Abdulaziz A. (megraa0a megraa0a)) on phone +966-13-8804510 ©Saudi Aramco 2017. All rights reserved.

Document Responsibility: Project Quality Standards Committee Issue Date: 14 November 2017 Next Planned Update: 14 November 2020

1

SAEP-85 Suppliers Assessment and Approval

Scope This procedure defines the minimum requirements, roles, and responsibilities to assess technical and quality capabilities of new and existing manufacturing plants to supply Saudi Aramco facilities and projects with inspectable commodities (9COMs) as defined in SAEP-44 and SAEP-133 and SAEP-133..

2

Conflicts and Deviations Deviations Any conflicts between this document and other applicable Mandatory Saudi Aramco Engineering Requirements (MSAERs) shall be addressed to the EK&RD Coordinator. Any deviation from the requirements herein shall follow internal compan y procedure SAEP-302.. SAEP-302

3

Applic able Documents All referenced specifications, standards, codes, forms, drawings, and similar material shall be of the latest issue (including all revisions, addenda, and supplements) unless stated otherwise. 3.1

Saudi Aramco References Saudi Aramco Engineering Procedures SAEP-44

Instructions Instructions for Commodity Commodity Material Material Management Management

SAEP-133

Instructions Instructions for the Developm Development ent and Maintenance Maintenance of “Inspectable Commodities” Engineering Standards

SAEP-302

Instructions Instructions for Obtaining Obtaining a Waiver Waiver of a Mandatory Mandatory Saudi Aramco Engineering Requirement

SAEP-347

Supplying Material from Stockists

SAEP-380

Equipment Equipment Deficiency Deficiency Report Report

SAEP-397

Vendor Performance Escalation

Saudi Aramco Manual Procurement Manual

3.2

Supplier Qualification and Registration (Prg. 6.31)

Industry Codes and Standards International Standardization Organization ISO 9001

Quality Manageme Management nt System Requireme Requirements nts Page 2 of 24


ISO 19011

4


Guidelines for Auditing Quality Management System

Definit ions and Abbreviations AAJ: Aramco Asia Japan. The abbreviation in SAP for Aramco Asia Operations. ASC: Aramco Services Company in Houston AOC: Aramco Overseas Company in The Hague UD: SAP Usage Decision Code (i.e., QSAA, QSNA, etc.) Corrective Action: An action taken to eliminate the causes of any existing nonconformity or other undesirable situation in order to prevent recurrence. Finding: Results of the collected assessment evidences against assessment criteria. Assessment findings can indicate either nonconformity or opportunities for improvement. IDCAT: Inspection categories as defined in SAEP-44. Nonconformance: A nonfulfillment of specified requirement, or a lack of effectiveness of methods or controls for a given process. P&SCM: Procurement and Supply Chain Management Quality Assessor: Inspection Department representative responsible for conducting and evaluating the quality management system of a manufacturing plant. Recommendation: Opportunities for improvement, best practices, or potential nonconformance. Responsible Inspection Office (RIO): Vendor Assessment Unit of Inspection Department in Dhahran, AOC Quality Management in The Hague, ASC Inspection Unit in Houston, or Aramco Asia Quality Management in Tokyo. Supplier Relations Unit (SRU): The entity responsible for supplier relations coordination. This is recognized as Supplier Relations & Qualification Unit in SAO, or its equivalent in Saudi Aramco subsidiaries: Supplier Relations Groups in AOC & AAJ, or Strategic Project Group in ASC. Sourcing Management Unit: The entity responsible for developing the Materials’ Sourcing priority list, which is based on the corporate Materials Sourcing S trategy. The entity is centrally located in SAO to support and concur all Out of Kingdom New Manufacturing Registration and Additional Materials Requests. Technical Assessor: An engineer qualified to conduct a technical assessment of a manufacturing plant for a specific commodity. The technical assessment includes both Page 3 of 24



the engineering and manufacturing capabilities. Technical Assessment Unit (TAU): The entity responsible for technical Assessments, such as: CSD, P&CSD, EPD, Drilling, or other technical department. Technical Unit Supervisor (TUS): The supervisor or group leader of TAU. Usage Decision (UD): SAP terminology used at the stage of final decision on manufacturer to assign approval status. Vendor: An organization that supplies materials and/or services to company. Vendor Review Committee (VRC): A committee under Engineering Services (ES) chartered to oversee and approve vendor approval related actions to supply 9COMs under ES jurisdiction, per established bylaws.

5

General 5.1

Assessment Request Type SAP workflow Assessment requests are categorized into the following: 

5.2

New Manufacturing Plant



Update Existing Manufacturing Plant



Delink



One-Time Approval



Other (i.e., Periodic, Follow-up, Notification, etc.)

Manufacturing Plant Assessment Reasons Manufacturing plant assessments are performed by quality and technical assessors, for new and existing manufacturers, with the following reasons: 

New Manufacturing Used only for assessment of new manufacturing plants. Plant



Re-assessment

Used to assess previously rejected manufacturing plant that was never approved before or placed on QSNA/MTNA UD Code.



Additional Material

Used to introduce new materials to an existing manufacturer, expand manufacturing plant sizes without necessarily additional product line, or increase in quantity of production.



Periodic

Used only for periodic Assessments. Page 4 of 24


Suppliers Assessment and Approval



Follow-up

Used to follow up on pending corrective actions.



Revise Limitation

Used to add, delete, or change in material technical limitations.



Delete Material

Used when a material is no longer supplied by/procured from an existing manufacturer.

Notification

Used to conduct unannounced or unscheduled assessments due to problem(s) identified by Service Review Committee (SRC), Inspection Representative, technical entity, or material end user.



Escalation

Used to conduct assessment due to escalation based on SAEP-397.



Reinstatement

Used to assess re-approving on-hold manufacturer (QSOH) or on-hold materials (MTOH), assess re-approving no longer used manufacturer (QZNU), and assess re-approving Material previously technically approved temporarily (MTAT).



Place On Hold

Used to place the existing approved manufacturer On-Hold due to major findings on quality system or material levels.

Manufacturing Plant Closure

Used to place existing approved manufacturer on No Longer Used (QZNU) status due to manufacturing plant closure/ceasing production.

Manufacturing Plant Relocation

Used to place existing approved manufacturer on No Longer Used (QZNU) status due to Manufacturing plant relocated to another location.







5.3

SAEP-85

Manufacturing Plants Assessment Types The purpose of assessment is to ensure that manufacturing plants h ave implemented an effective quality management system in accordanc e with ISO 9001 and that the plants have the technical capabilities to produce products and equipment that meet Saudi Aramco requirements and specified industry standards. The manufacturing plant assessment types are: 

Survey:

Assessment of manufacturer capabilities for new manufacturing plants through physical visit.



Assessment:

Assessment of manufacturer capabilities for existing manufacturing plants through physical visit.



Desk Review: Assessment of manufacturer capabilities through documents, certificates, and records review. Page 5 of 24



Refer to EXHIBIT I for more information about the request type, reasons, an d assessment type along with the issuing entities. 5.4

Physical Assessment vs. Desk Review The decision to perform physical assessment versus desk review assessment shall be determined based on pre-established criteria within the respective organization in line with EXHIBIT I of this procedure. Commentary Note: New manufacturing plants survey shall be conducted through physical assessment.

6

Registr ation and Workflow Creation Proper review shall take place to ensure the following prior to workflow creation: 6.1

SRU to complete the review of all commercial and financial requirements.

6.2

SRU to complete the attachment of all technical requirements as per established technical screening checklist. This includes but not limited to vendor compliance letter to Saudi Aramco specifications/standards, past major supply, major customers list, and technical and quality certifications. Commentary Note: Technical screening requirements checklist shall be established and documented in a published Best Practice by each ES Standards Committee.

6.3

SRU to complete the attachment of all quality requirements folder including minimum of below documents as applicable: 



Uncontrolled copy of the quality manual Copies of the mandatory quality systems procedures as required by ISO 9001



Complete organization chart including all QA/QC staff names



List of key manufacturing equipment at the manufacturing facility



Number and certifications of welding and NDT QC Inspectors



Qualification of QA and QC Managers



Manufacturing plant Capacity



Manufacturing Area (covered and uncovered)



Factory location map Page 6 of 24

Document Responsibility: Project Quality Standards Committee Issue Date: 14 November 2017 Next Planned Update: 14 November 2020 



7


Copy of valid ISO 9001 certificate A completed Saudi Aramco Vendor's Manufacturing Plant Assessment Questionnaire

6.4

SRU to confirm in writing with the manufacturer their readiness for the assessment on a specified week. This confirmation is required to allow for proper planning for the company technical and quality assessments.

6.5

SRU must ensure that the production is running during the confirmed survey/assessment date.

6.6

SRU shall create Assessment request not less than four (4) weeks before the manufacturer confirmed assessment week for OOK and not less than one (1) week for IK manufacturer. This Assessment request will be directed to Technical and Quality organizations to review the submitted package, acknowledge the SAP WF, and then allocate the required resources to conduct the assessment as the specified assessment week.

6.7

Re-triggering of technical and quality assessment request workflows shall be made automatically in the system on the vendor confirmed assessment week, or manually by the technical and quality assessors. The triggering of the WF shall not be more than eight (8) weeks from the confirmed assessment week.

6.8

RIO shall schedule periodic assessment WFs in SAP system. The WF for periodic assessment will be triggered for quality and technical assessments. However, the need to conduct the technical assessment will be determined b y the technical unit Supervisor according to pr e-established criteria.

6.9

Technical Unit Supervisor (TUS) is allowed to create WF in SAP to add or modify limitations. The WF will be triggered for technical and quality assessments. However, the need to conduct the quality assessment will be determined by RIO according to pre-established criteria.

Screening In Kingdom (IK) manufacturer workflow shall be triggered by SRU in the system to the technical and quality supervisors to perform the screening review. This includes assigning assessors/reviewers to review the technical and quality packages content and attachments against established screening checklists to ensure manufacturer technical readiness for assessment. Commentary Note: Pre-screening meeting should be conducted with new local manufacturers to verify and support on meeting the quality and technical approval requirements stipulated in ERTQA (Posted in IKTVA website). Page 7 of 24



Out of Kingdom (OOK) Manufacturer workflow shall be triggered in the system to Sourcing Management Unit (SMU) Supervisor for his concurrence p rior to be triggered in the system. During the screening review, assessors/reviewers will either Acknowledge or Return the workflow as follows: 7.1

Acknowledge This action confirms completeness of the quality and technic al requirements. Once selected, it will trigger two options: 

Wait for Assessment This option will remove the workflow from the assessor’s/reviewer’s inbox and will automatically retrigger it to the supervisors inbox on the start of the confirmed assessment week. The supervisors shall then assign their respective assessors to conduct the technical or qu ality assessments.



Process Immediately This option will remove the workflow from the assessor’s/reviewer’s inbox and will automatically retrigger it to the supervisor ’s inbox immediately. The supervisors shall then assign their respective assessors to conduct the technical or quality assessments.

7.2

Return This action confirms rejection of the quality and/or technical p ackages due to issues with package completeness or manufacturer readiness. Rejection of the request shall be processed in the system. Once selected, the packages will be returned to the vendor through SRU for subsequent action. Commentary Notes: 1- The option to “Wait for Assessment” is intended for assessors to check their workload and schedule the assessment in their calendar according to the confirmed assessment week. Alternatively, the assessor(s), through the “Process Immediately” option, may schedule the assessment earlier in collaboration with the vendor. 2- For Engineering Services’ commodities, VRC prior approval is required before return option is exercised to reject or cancel a WF for a manufacturer that completes required documentations submittal and demonstrated readiness for Company assessment team.

Page 8 of 24


8


Manufacturi ng Plant Assessments The purpose of this section is to highlight the two methods utilized in conducting the manufacturing plant assessment. Based on the decision requirements of Section 5.4, a physical or desk review assessment shall be conducted as specified below: 8.1

Physical Assessment 8.1.1

Upon work flow creation and after successful screening, the assessor will coordinate the manufacturing plant assessment schedule with the vendor’s representative. This physical assessment may be on the vendor confirmed assessment week or an earlier agreed upo n time with the vendor: 8.1.1.1

The assessor(s) must ensure that the vendor is manufacturing the assessed product.

8.1.1.2

The assessor(s) must verify that the production is running during the survey/assessment, while accounting for personal safety.

8.1.2

The assessor(s) may share the assessment plan/agenda as part of the coordination/planning activities. Communication should be initiated in advance to allow vendor and team members to prepare for the Assessment.

8.1.3

Upon arrival to the manufacturer’s facility, the assessor(s) shall conduct an opening meeting introducing the team members, explaining the scope of the manufacturing plant Assessment (i.e., list of 9COM materials) and discuss the agenda.

8.1.4

The quality assessment shall be conducted against the requirements of ISO 9001 including, as applicable, a pre-established quality assessment checklist and scoring criteria.

8.1.5

The technical assessment shall be conducted according to the internal guidelines including, as applicable, a pre-established technical assessment checklist and scoring criteria. Commentary Note: For Engineering Services’ commodities, technical assessment shall be conducted as per established checklist and documented in a published Best Practice by each Standards Committee.

8.1.6

The minimum passing score for manufacturer quality and technical assessments is 70%. Page 9 of 24



Commentary Note: Justification for additional material to existing vendors with Vendor Quality Index (VQI) less than 65% shall be pre-approved in writing by VID Division Head prior to further processing in SAP.

8.1.7

Objective evidence should be collected through interviews, verification of documents, records, observations of activities, and product fun ctional testing.

8.1.8

Nonconformities shall be identified and referenced against the requirements of specific related standards.

8.1.9

The assessor(s) should ensure that the findings and recommendations are documented in a clear, concise manner and supported by objective evidence.

8.1.10 The assessor(s) shall conduct a closing meeting with the manufacturer’s top management representatives to present the assessment findings. Vendor Acknowledgement of assessment Findings (EXHIBIT IV) shall be completed and signed by manufacturer’s top management representative along with acceptable ETC (90 days maximum) to close the findings. 8.1.11 The assessor(s) is/are not allowed to inform the manufacturer with the Assessment conclusion. The assessor(s) should explain to the manufacturer that SRU is the official channel to co mmunicate the assessment results. 8.2

Desk Review Assessment Desk review Assessments are conducted without performing physical visit of manufacturer facility. Desk review assessments are conducted through reviewing the manufacturer’s quality/technical submittals and historical records such as EDRs, NCRs, performance of installed equipment, and past assessments findings closure status. Commentary Note: Desk Review is not allowed for new manufacturing plants and survey shall be conducted through physical assessment.

9

Reporti ng Manufacturi ng Plant Assessments 9.1

The assessor(s) shall timely document and report the assessment results along with the recommendation in the relevant SAP workflow. The assessor(s) shall prepare and attach to SAP WF the following documents: 1. Compliance letter (EXHIBIT III) Page 10 of 24



2. Vendor Acknowledgement Form. (EXHIBIT IV) 3. Assessment report 4. Completed scoring criteria, as applicable 5. VRC Action Request, applicable for ES commodities 6. Photos of the facility, as applicable 7. Applicable Certificates (i.e., ISO, ASME, UL, etc.) 8. Formal letter of relocation, closure, or ceasing production, as applicable. 9.2

For Engineering Services commodities, quality and technical recommendations shall be peer reviewed. Final recommendation shall be presented by the RIO Head and Standards Committee Chairman (SCC) to be presented to the Vendor Review Committee for approval as per the established b ylaws. Commentary Note: Photos are required for requests for new, reinstatement, and additional material assessment reasons. The assessor shall take photos of the facility size, receiving inspection and quarantine areas, testing equipment, storage, and ongoing manufacturing of the assessed commodity.

9.3

The quality assessor shall process the approval recommendation as per Table 1 for manufacturer’s quality management system. Table 1 - Quality Management System Recommendations

UD Code

UD Code Descripti on

QSAA

Quality System Approved

QSAC

Quality System Approved w/corrective action

QSNA

Quality System NOT APPROVED

QSOH

Quality System ON-HOLD

QZNU

Quality System No Longer Used

QSAT

Quality System Approved Temporary

Applicability Survey, Assessment, or Desk Review with no significant quality findings Survey, Assessment or Desk Review with minor quality findings and not impacting the integrity of the product. The QSNA designation is used for the following cases: New manufacturing plant survey where the quality assessor  determines existence of major findings that will impact the integrity of the product. Manufacturing plants with On-Hold status and failed to close  existing major findings. The QSOH designation is a temporary status used for placing an existing approved manufacturer On-Hold due to major findings. The QZNU designation is used for previously approved vendors and requires supporting/confirming documentation from SRU: Manufacturer facility is closed or relocated  Manufacturer facility not producing specified 9COM material  Manufacturer management not interested to do business  with Saudi Aramco The QSAT designation is used only if plant will be approved for exclusively material with MTAT status.

Page 11 of 24


9.4


The technical assessor(s) shall process the approval recommendation as per Table 2 for each 9COM in the relevant SAP WF. Table 2 - Technical Recommendations

UD Code

UD Code Descript ion

MTAA

Material Technically Approved

MTNA

Material Technically Not Approved

Material Technically OnHold Material Technically Approved with Limitation

MTOH MTAL

Material Technically Approved Temporary

MTAT

10

Applicability Survey, Assessment or Desk Review with no significant technical findings Designation is used for the following cases: New manufacturing plant survey where the technical  assessor determines existence of major findings that will impact the integrity of the product. On-Hold Material in which manufacturing plant failed to  remedy existing major findings. Designation is temporary status used for placing existing approved material On-Hold due major findings. Designation is used when technical limitation(s) exist. Designation is only used under the following conditions: Trial orders  One-time approval (e.g., Project, PO, etc.)  Approval for set time frame

Support to Newly Established Local Manufacturers For newly established local manufacturing plants with no sufficient production experience, the following approval model ma y be applied, subject to appropriate line management approval (i.e., VRC for ES managed 9COMs): 10.1

The approval status of such facilities shall be assigned as temporary (QSAT).

10.2

First PO will be considered as trial and this condition shall be reflected in SAP “Q-Info” record against each commodity along with applicable technical limitations (e.g., quantity, size, rating, etc.).

10.3

Inspection Department and relevant Technical Department shall monitor the performance of the manufacturer during the production of the trial PO and conduct complete quality and technical assessments. Performance monitoring can be done through increasing inspection levels, reviewing inspection reports, attending final inspections/FAT by the technical SME, and /or conducting focus assessments.

10.4

Quality and Technical assessors will reflect the result of the manufacturer actual performance monitoring during the trial purchase ordered as well as the assessment in a SAP MAP WF along with prope r recommendation for required approval.

Page 12 of 24


10.5

11


Technical and Quality Assessment teams may elect to conduct a Pre-assessment to support local manufacturing plants, without WF in coordination with P&SCM addressed to a Division Head level as minimum.

Approval Process Finalization Assessment recommendation shall be documented, reflected and processed in SAP through the required approval authority as per EXHIBIT II and below instructions: Quality and technical assessors shall process assessment recommendation in SAP for approval as per 13.3.2 and 13.4.2 in this procedure. Assessors recommendations shall be reviewed and processed by RIO Head and TUS as per Section 13 and Section 13.4 in this procedure. Commentary Note: For Engineering Services’ commodities, assessment recommendation shall be processed after obtaining the Vendor Review Committee approval.

Final decision on assessment recommendation shall be processed b y Quality and Technical Division Heads (in line with the VRC direction in case of Engineering Services’ commodities) as per 13.3.3 and 13.4.3 in this procedure. Upon completion of quality WF and a minimum of one technical WF, combined approval decision will be automatically reflected in SAP for SRU further communication with the manufacturer.

12

Approved Suppliers Maintenance 12.1

Periodic Assessment Periodic assessment of approved manufacturers shall be conducted against ISO 9001 requirements and other engineering standards (SAEP, SAES, and SAMSS) as applicable to ensure that the manufacturers continue to maintain effective quality management system and acceptable technical capabilities. Assessment frequency and intervals shall be determined based on a preestablished criteria defined in relevant departmental guidelines and proced ures.

12.2

Technical Limitations Technical limitations shall be written in a clear and con cise manner. The limitation shall be not specify already applicable requirements in referenced standards or specifications. It is not acceptable to specify any organization by name within the context of the technical limitation.

Page 13 of 24



Technical limitation may include product related limitation (i.e., size, thickness, material type, and system release), scope limitation, machine and product line capacity. Commentary Note: For Engineering Services’ commodities, Technical Limitation shall be written and specified as per established departmental guidelines.

12.3

Extension of One Time/Temporary Approval Process for to initiate temporary approvals shall be as stipulated in S audi Aramco Procurement Manual. When temporary approval expires in SAP, quality and technical teams shall assess the technical ne ed to transfer the approval from temporary to permanent based on the vendor actual performance. Vendors with demonstrated excellent performance should be recommended to management (Division Head as a minimum and VRC for ES commodities) for permanent approval. Vendors with demonstrated unsatisfactory performance should be recommended to management (Division Head as a minimum and VRC for ES commodities) for permanent disapproval. The final recommendation shall be provided to SRU. WFs for permanent approval shall be created by Supplier Relation Representative.

12.4

Handling of Approval Status of Vendors with 9COMs with Changed Status (Changed to Deleted/Non-Inspectable Commodities) When status of inspectable 9COM(s) is changed to non -inspectable or deleted (DD coded), the following actions shall be taken on the manufacturers linked to the impacted 9COM(s): 12.4.1 Standards Committee Chairman (SCC) is required to allocate alternative appropriate 9COM(s) to replace the deleted or no n-inspectable one(s). 12.4.2 If there is no alternative for non-inspectable 9COM, the manufacturer status shall be changed manually to QZNU (no longer used) as long as the subject 9COM is the only 9COM linked to this manufacturer. Management approval (Division Head as a minimum and VRC for ES commodities) is required prior to the manual change. 12.4.3

12.5

If there is no alternative for deleted 9COM, the manufacturer status shall be changed through SAP workflow as QZNU (no longer used) as long as the subject 9COM is the only 9COM linked to this manufacturer.

Manufacturers with Unsatisfactory Quality/Technical Performance Manufacturers with experienced unsatisfactory quality and technical performance shall be handled as per SAEP-397. Technical and/or Quality Page 14 of 24



Departments may create a WF in SAP to place a manufacturer on hold. Commentary Notes: On-Hold status is a temporary status in which manufacturer shall complete all required actions within 12 months. If the manufacturer cleared all issues that resulted of the On-Hold status, a reinstatement WF can be created by PSCM for a re-survey based on sourcing requirements. If the manufacturer failed to clear all issues within 12 months, approval status should be changed to permeant disapproval following SAP MAP WF process. All technical and quality on- hold related actions shall be processed through SA P workflow.

12.6

Handling of Relocating, Ceasing operation/Closing Vendors In order to ensure governance and not to lose reliable approved manufacturers due to relocation, it is required to create workflow for vendors with facilities under relocation, renovation, or ceasing operation provided the following are met: 12.6.1 Receiving a formal letter from the vendor senior management addressed to the Procurement appropriate management authority notifying about the manufacturing facility closure, ceasing production, o r relocation. 12.6.2 In case of relocation, the vendor shall indicate as applicable the status of the new facility readiness and the date it c an be fully operational if not already. 12.6.3 Once the vendor formal notification letter is received, the workflow can be created by the Procurement team and attach to the workflow the received vendor letter for further processing. Approval status of vendor no longer in business shall be changed to QZNU through SAP workflow to safeguard against receiving any purchase order.

13

Roles and Respons ibili ties 13.1

Supplier Relation Representative 13.1.1 Review commercial status of the manufacturer. 13.1.2 Verify manufacturer commercial and legal information as applicable. This includes but not limited to: 13.1.2.1 Basic supplier information 13.1.2.2 Address details

Page 15 of 24



13.1.2.3 Products/services information 13.1.2.4 Commercial Requirements 13.1.2.5 Copy of articles of association (for companies only) 13.1.3 Review manufacturers’ ownership information for potential or actual conflict of interest and verifies if owners’ ID number is on the watch list. Additionally, Supplier Relation Representative shall seek direction from Personnel Department if potential or actual conflict of interest is indicated. 13.1.4 Create the Assessment request in SAP as listed in EXHIBIT I. 13.1.5 Confirm with the manufacturer on their readiness on the assessment week. 13.1.6 Attach technical and quality documentations listed as per 6.2 and 6.3 and check that technical and quality requirements are fulfilled for each WF. 13.1.7 Attach complete vendor's manufacturing plant Assessment questionnaire that includes as minimum the following information: 











Vendor Information : name, location, and contacts Major Buildings: major buildings and facilities Product Information : product, standards and codes, limitation, and capacity for each requested commodity Manpower : personnel details including but not limited to Design, Production, Quality, and HR Process: main production and testing processes Sub-Suppliers/Sub-Contractors : details of major product and service suppliers

13.1.8 Trigger technical and quality Assessment request workflows in line with paragraphs 6.6 and 6.7 of this procedure. 13.1.9 Submit/send official letter to inform the manufacturer on the Assessment results within one week from completion of WFs. 13.2

Sourcing Supervisor (SS) P&SCM SMU Supervisor has to review every workflow for OOK manufacturing plants to ensure compliance to Saudi Aramco Material Sourcing Page 16 of 24



List and the Corporate Materials Sourcing Strategy. SMU Supervisor shall review OOK WFs in order to: 



Concur on each 9COM Material in the SAP WF. Reject at least one 9COM or the entire WF as applicable via the system for failing to comply with the Materials Sourcing List. Justification has to be given per rejected 9COMs. Only 9COMs approved by SMU Supervisor shall proceed to the quality and technical supervisors.

Return the entire WF back to SRU to request SRU to add missing materials worth evaluating, contingent that the manufacturer is legally and physically able to produce/manufacture the material(s) to be added. 13.3

Quality Responsibilities 13.3.1 RIO Head (IK/OOK) 13.3.1.1 The RIO Head is responsible for receiving manufacturing plant Assessment requests through SAP. 13.3.1.2 The RIO Head reviews the requests to ensure completeness and concurs on the Assessment priority and assigns quality assessor. 13.3.1.3 The RIO Head is responsible for continuously monitoring the status of all manufacturing plant Assessment requests assigned to the unit. 13.3.1.4 The RIO Head is responsible for reviewing the final manufacturing plant Assessment report and recommended UD prior to release of workflow to the nex t approver. 13.3.1.5 The RIO Head or his designee shall generate periodic assessments WFs and create periodic assessments plan to monitor scheduling and on time completion. 13.3.2 Quality Assessor (QA) 13.3.2.1 The QA shall not begin any facility physical assessment if SAP Assessment Request has not been initiated. 13.3.2.2 The QA will receive and review the manuf acturer’s quality management system documentation in order to become thoroughly familiar with the manufacturer’s quality management system. Documents reviewed should include, at

Page 17 of 24



a minimum; manufacturing plant Assessment questionnaire, manufacturer’s QMS main documentation. Additional documents, such as manufacturer procedures and work instructions, can be reviewed as deemed necessary by the QA. 13.3.2.3 Assessment requests with missing essential information shall be returned in SAP as per Section 7. 13.3.2.4 For all Assessments, other than new vendors, the QA should review the vendor’s records in SAP including p revious Assessments, inspection lots for previous 60 months purchase orders, Q-Info records for material limitations, and previous 24 months of quality notifications including the following: F4: Assessment Findings Q4: Equipment Deficiency Report (EDR) Q5: Rejection Notice Q8: Nonconformance Report (NCR) Q9: Worksheet Commentary Note: Theses notifications are used to record quality findings during different stages of production. They can be accessed per each existing manufacturing plant number using SAP transaction; QM11, ZQ0025.

13.3.2.5 The QA shall conduct the manufacturing plant assessment as per Section 8. 13.3.2.6 The QA shall complete all reporting requirements as per Section 9. 13.3.2.7 The QA shall record assessment results and process the quality recommendation in SAP. 13.3.2.8 For QSAC approvals, the QA shall follow-up with the manufacturer to ensure proper closure of the findings. If the manufacturer failed to close the findings within the agreed upon date in the closing form, the assessor shall trigger the escalation process as per SAEP-397. 13.3.3 Vendor Inspection Division Head During final approval stage for quality assessment, VID Head is Page 18 of 24



responsible to review the quality report and app rove quality assessment recommendation in the related SAP WF. Commentary Note: For Engineering Services’ commodities, WF shall be processed after and as per Vendor Review Committee endorsement.

13.4

Technical Responsibilities 13.4.1 Technical Unit Supervisor (TUS) 13.4.1.1 The TUS is responsible for receiving manufacturing plant Assessment requests through SAP/PRC. The supervisor or respective unit SMEs (e.g., SCC) reviews the requests to ensure completeness and assigns technical assessor for each 9COM as applicable. 13.4.1.2 The TUS is responsible for continuously monitoring the status of all manufacturing plant Assessment requests assigned to the unit. 13.4.1.3 The TUS is responsible for reviewing the final manufacturing plant Assessment report and prior to release of workflow to the next approver. 13.4.2 Technical Assessor (TA) 13.4.2.1 TA is responsible for performing technical assessment of manufacturers and products. 13.4.2.2 TA is responsible to review the WF to ensure all the required documents are available. In addition, TA shall identify and select potential 9COMs applicable to the manufacturer based on the provided technical documents. 13.4.2.3 During manufacturing plant survey stage, TA is responsible for the following: 



Coordinate and conduct manufacturing plant visit. Assess manufacturer’s engineering and fabrication capabilities and identify deficiencies.



Complete manufacturing plant assessment checklist.



Complete Vendor Acknowledgement Form.

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Prepare and sign technical report. Page 19 of 24

Document Responsibility: Project Quality Standards Committee Issue Date: 14 November 2017 Next Planned Update: 14 November 2020 

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Discuss technical report with SCC. TA shall attach the technical report in SAP (refer to Section 9) and fill the following fields as applicable for each 9COM: 

Remarks: Summary of technical decision.

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Capacity: Manufacturer production capacity.

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Limitation: Manufacturer technical limitation.

13.4.2.4 OOK Offices technical assessors shall perform the manufacturing plant assessment, if instructed by the responsible technical department as per paragraph 6.7 and answers clarifications from SCC and modify the reports as required. 13.4.3 Technical Division Head (TDH) During final approval of technical assessment, Technical Division Head is responsible to review the technical report and approve technical assessment recommendation in related SAP WF(s). Commentary Note: For Engineering Services’ commodities, WF shall be processed after and as per Vendor Review Committee approval.

14

Exhibits EXHIBIT I

ASSESSMENT REQUEST MATRIX

EXHIBIT II

PLANT ASSESSMENT PROCESS MAP IN SAP

EXHIBIT III

VENDOR COMPLIANCE LETTER

EXHIBIT IV

VENDOR ACKNOWLEDGEMENT OF ASSESSMENT FINDINGS FORM

Revisio n Summary 14 November 2017

New Saudi Aramco Engineering Procedure that defines the minimum requirements and roles and responsibilities to assess technical and quality capabilities of new a nd existing manufacturing plants to supply Saudi Aramco facilities and projects with inspectable commodities (9COMs).

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EXHIBIT I: ASSESSMENT REQUEST MATRIX Assessment Request Type New Manufacture Plant

Initiator

Supplier Relations Unit

Update Existing Manufacturer Plant


Delink


One Time Approval


Assessment Request Reason New Manufacturing Plant Reassessment

Revise Limitation

Assessment Type

Survey Survey Assessment, or Desk Review*

Additional Material Reinstatement Delete Material Manufacturing Plant Closure Manufacturing Plant Relocation Place On Hold

Assessment Survey

New Manufacturing Plant

Survey

Assessment, or Desk Review*

Periodic Assessment Other

Technical and/or Quality Unit

Notification Escalation

Assessment, or Desk Review*

Follow Up on Pending Corrective Actions *The decision to conduct physical visit or desk review is determined as per pre-established criteria by the organization responsible to perform the Assessment

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EXHIBIT II: MANUFACTURING PLANT ASSESSMENT PROCESS MAP IN SAP

*For Assessment requests with type “Other”, workflow will start in the “Screening and Assessor Assignment” stage. **WFs with Periodic Assessments as Assessment reasons are excluded if the Assessment results do not require change in the approval status on quality and/or 9COM(s) level.

Page 22 of 24



EXHIBIT III: VENDOR COMPLIANCE LETTER To: “Procurement & Supply Chain Management Representative” We (Company Name, Manufacturer Number: 3XXXXX ) confirm that our manufacturing plant has the full capability to manufacture below commodities and equipment and will strictly comply with the flowing Saudi Aramco requirements: S/N

1

9COM & Description

SAES

SAMSS

175 From

6XXXXX Description

2

CEO or Most Senior Management (Only)

Signature: ___________________

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EXHIBIT IV: VENDOR ACKNOWLEDGEMENT OF ASSESSMENT FINDINGS FORM

Engineering Services Vendor Acknowledgement of Assessment Findings

Manufacturing Plant ID

Manufacturer Name

9COM #

Assessment Request No.

Assessment Date

9COM Description

Assessment Type

Technical

Quality

Assessor(s) (Please print the name) Findings

Acknowledgement Corrective Action Implementation Date Management Representative (Please print the name)

Signature

Date

Page 24 of 24

SAEP_85

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