Automotive Restart – Contingency Planning

Contingency planning is the topic of Part 4 of the Automotive Restart series.  As evidenced when the COVID-19 pandemic brought everything to a screeching halt, it’s critical to plan for unforeseen problems or circumstances.  The IATF 16949 defined tool to prepare for those issues, emergencies and disasters is the use of a contingency plan.  The primary focus of contingency planning is ensuring the impact to the customer is lessened and that customer specifications and requirements will continue to be met. Ensuring the safety and security of your employees and understanding the risks to and impact on your business processes and equipment is key to a restart.

A point to remember; the contingency actions identified are for use after the unfortunate event has already happened.  The plan is not necessarily a prevention tool, the plan is a reaction tool.  In other words, this is what the organization will do when “it has hit the fan.”  

These contingency plans need to be reviewed with your cross functional teams to ensure applicability and acceptability.  A critical component of contingency planning is ensuring the actions that are identified are routinely tested or simulated.  Keeping evidence of this testing is critical in proving to interested parties that the contingency plan should be able to work when needed.

Some of the events that may require activating the contingency plan include:

  1. Supply chain disruptions or insolvencies (reference Automotive News article on April 20, 2020 “Restart Rules” remembering the supply chain is only as strong as the weakest link)
  2. Labor shortages and possible disruptions from employee safety and health requirements (reference State of Ohio responsible restart procedures or your state’s guidance for reopening).
  3. A regional shutdown for your organization or a key supplier due to a resurgence of the COVID-19 virus
  4. Infrastructure disruptions as a result of local or state imposed quarantine orders

Consider the following IATF 16949 requirements when formulating a contingency plan.

  1. IATF section 6.1.2.3-identify internal and external risks, define contingencies, test contingencies, review contingencies, document contingencies. Also, ensure the customer and interested parties are notified of the impacts
  2. IATF section 8.3.4.4-changes that may impact the manufacture of the product and result in a PPAP submission to the customer
  3. ISO 9001 and IATF 16949 9.1.2 reminds us not to forget customer satisfaction while planning and implementing these actions
  4. All applicable CSRs (Customer Specific Requirements) for managing and communication contingency actions, especially customer acceptance of the actions, if required.

AIAG offers a Business Continuity Planning Toolkit for the Automotive Supply Chain M-12 1/2007. This guide aids suppliers in the development of business continuity programs. It can be adopted for any size organization and also can be used to validate an existing program. It comes with a downloadable toolkit.

AIAG is also offering a free e-document –  Pandemic Preparedness and Response Plan (OHS-6 1st Edition). This plan is geared to Tier 2 or 3 suppliers and enables them to prepare for and address pandemic related business disruptions.

FloridaMakes provides a helpful checklist for Supply Chain Disruption Planning.  Your regional Manufacturing Extension Partnership (MEP) is a good resource for small and medium sized manufacturers. 

The next and final part of this series Employee Safety will cover changes to the work environment and the responsibility of keeping employees safe and minimizing COVID-19 infections.

SimpleQuE strives to be an informational source that provides value to our customers by examining some of the challenges identified by the automotive industries and provide insight into the IATF 16949 requirements to help your organization maintain compliance during this unusual and complex time. 

This series of articles was written for simpleQuE by Robert (Bob) Dornhecker, a simpleQuE consultant who specializes in ISO 9001 and IATF 16949 quality system development, auditing and training. He also performs third party audits for Certification Bodies including Eagle Certification Group. With over 30 years of combined experience in auditing, manufacturing and certification, Bob has an extensive quality background.  Additionally, he has taught and facilitated many quality related training classes for clients and has provided support to companies securing their own ISO/Quality Management Systems certifications.

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