Original Date: 08/07/1995
Revision Date: 01/18/2007

Lockheed Martin Tactical Aircraft Systems’ (LMTAS’)preferred supplier program helps decrease costs associated with ensuring acceptable quality from its suppliers, while enhancing the suppliers’ confidence levels. This program, called the STAR Supplier Program, was established in mid-1994 and since that time, 47 of the total 601 production suppliers have been classified as STAR participants. Forty-one more suppliers are currently under consideration.

To qualify as a STAR participant, the supplier must meet the selection criteria for quality, schedule, and cost. The acceptable quality level criteria includes a supplier maintaining an LMTAS Statistical Process Control (SPA) System Certification in accordance with mandatory contract requirements. The supplier must have maintained zero percent rejections at a designated point of inspection during the 6-month period prior to consideration. Additionally, it must have maintained a zero non-conformance cost during this same period. The second criteria for selection is ratio of on-time deliveries to purchase order schedule must be 98% or higher. Untimely deliveries are not only considered to be those delivered after the scheduled time, but before as well. As the primary cost criteria, the supplier must show a decreasing price trend over the life of the program. It must demonstrate a responsiveness to cost containment initiatives and give prompt acknowledgments, reports, and compliance with requirement changes. In general, it should demonstrate a commitment to the program.

Once a supplier has been designated as meeting the candidate selection criteria, validation of the results takes place in the form of a STAR Quality System Audit. Additionally, a formal surveillance plan is developed that establishes manufacturing process flow validation points, frequency of on-site visits, and product audit checklists. The results of these activities are than presented to the Executive Steering Committee for STAR supplier approval.

Once selected as a STAR participant, the supplier must show continuation of its performance through limited post- award surveillance. Incremental and unannounced surveillance visits of the supplier are performed by designated surveillance representatives. Furthermore, formal STAR performance reviews are conducted by the Executive Steering Committee on an arbitrary basis to consider certification validation of the supplier. Nonconformances are treated in a highly cooperative manner to promote prompt corrective action. Letters of concern are sent to senior management for items such as issuance of a minor waiver and failure of an in-process audit at the facility. Suspension may occur for items as issuance of a major waiver or repetition of in-process audit failures. The supplier is only removed if it loses its SPC System Certification, shows repetitive corrective action milestone schedule failures, or fails to maintain effective corrective actions.

The benefits obtained by the affected suppliers are a reduction in facility oversight by LMTAS and Lockheed corporate recognition. Benefits to LMTAS include confidence in top quality product buys through a strategic alliance of preferred suppliers, on-time delivery assurance, and reduction in product costs. To date, Lockheed has reduced supplier expenses by over $320K and decreased the personnel required to oversee supplier activity. As a result of proactive relations between Lockheed and its preferred suppliers, no STAR participants have been removed from the program.

For more information see the Point of Contact for this survey.