Welcome to Seminar on IATF 16949:2016 Key Changes

Welcome to Seminar on IATF 16949:2016 Key Changes TV SD South Asia 25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 1 Copyright This presentation is copyright protected. All rights reserved by TV SD South Asia Private Limited No part of this material should be copied, presented in any media or form unless written permission is received from the head of the Academy Division of TV SD South Asia Private Limited, INDIA.

TV SD South Asia 25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 2 Agenda To understand key changes in IATF 16949:2016 standard TV SD South Asia 25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015

Slide 3 Impact of ISO 9001:2015 Revision to ISO/TS 16949 to IATF 16949:2016 in October 2016 Revision of IATF Rules 5th Edition in November 2016 Currently Issues Certificates to ISO/TS 16949 will be with validity max up to September 2018 Audits as per old ISO/TS 16949 are allowed only till October 2017 TV SD South Asia 13-02-01 Management Systems Slide 4

IATF 16949:2016 REQUIREMENTS Clause 4 Context of the Organization TV SD South Asia 25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 5 IATF 16949:2016 QMS Requirements 4 Context of the organization 4.1 Understanding the organization and its context The organization shall determine external and internal issues that are relevant to its purpose and its strategic direction and that affect its ability to achieve the intended result(s) of its quality management system.

The organization shall monitor and review information about these external and internal issues. TV SD South Asia 25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 6 IATF 16949:2016 QMS Requirements 4.2 Understanding the needs and expectations of interested parties Due to their effect or potential effect on the organizations ability to consistently provide products and services that meet customer and applicable statutory and regulatory requirements, the organization shall determine: a) the interested parties that are relevant to the quality management system; b) the requirements of these interested parties that are relevant to the quality management system.

The organization shall monitor and review information about these interested parties and their relevant requirements. TV SD South Asia 25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 7 IATF 16949:2016 QMS Requirements 4.3.2 Customer-specific requirements Customer-specific requirements shall be evaluated and included in the scope of the organization's quality management system. TV SD South Asia 25-May-15

TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 8 IATF 16949:2016 QMS Requirements 4.4 Quality management system and its processes 4.4.1 The organization shall determine the processes needed for the quality management system and their application throughout the organization, and shall: a) determine the inputs required and the outputs expected from these processes; TV SD South Asia 25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 9

IATF 16949:2016 QMS Requirements 4.4.1.2 Product safety The organization shall have documented processes for the management of product-safety related products and manufacturing processes, which shall include but not be limited to the following, where applicable: a) identification by the organization of statutory and regulatory product safety requirements; b) customer notification of requirements in item a); c) special approvals for design FMEA; d) identification of product safety-related characteristics; TV SD South Asia 25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 10

IATF 16949:2016 QMS Requirements 4.4.1.2 Product safety e) identification and controls of safety-related characteristics of product and at the point of manufacture; f) special approval of control plans and process FMEAS; g) reaction plans (see Section 9.1 .1 .1); h) defined responsibilities, definition of escalation process and flow of information, including top management, and customer notification; I) training identified by the organization or customer for personnel involved in product-safety related products and associated manufacturing processes; TV SD South Asia 25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015

Slide 11 IATF 16949:2016 QMS Requirements 4.4.1.2 Product safety j) changes of product or process shall be approved prior to implementation, including evaluation of potential effects on product safety from process and product changes (see ISO 9001, Section 8.3.6); k) transfer of requirements with regard to product safety throughout the supply chain, including customer-designated sources (see Section 9.4.3. 1); l) product traceability by manufactured lot (at a minimum) throughout the supply chain (see Section 8.5.2.1); m) lessons learned for new product introduction. Note: Special approval is an additional approval by the function (typically the customer) that is responsible to approve such documents with safety-related content. TV SD South Asia 25-May-15

TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 12 IATF 16949:2016 QMS REQUIREMENTS Clause 5 Leadership TV SD South Asia 25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 13 IATF 16949:2016 QMS Requirements 5 Leadership

5.1 Leadership and commitment 5.1.1 General Top management shall demonstrate leadership and commitment with respect to the quality management system by: a) taking accountability for the effectiveness of the quality management system; b) ensuring that the quality policy and quality objectives are established for the quality management system and are compatible with the context and strategic direction of the organization; c) ensuring the integration of the quality management system requirements into the organizations business processes; TV SD South Asia 25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 14 IATF 16949:2016 QMS Requirements

5.1 Leadership and commitment 5.1.1 General d) promoting the use of the process approach and risk-based thinking; e) ensuring that the resources needed for the quality management system are available; f) communicating the importance of effective quality management and of conforming to the quality management system requirements; g) ensuring that the quality management system achieves its intended results; h) engaging, directing and supporting persons to contribute to the effectiveness of the quality management system; TV SD South Asia 25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 15

IATF 16949:2016 QMS Requirements 5.1 Leadership and commitment 5.1.1 General i) promoting improvement; j) supporting other relevant management roles to demonstrate their leadership as it applies to their areas of responsibility. NOTE Reference to business in this International Standard can be interpreted broadly to mean those activities that are core to the purposes of the organizations existence, whether the organization is public, private, for profit or not for profit. TV SD South Asia 25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 16

IATF 16949:2016 QMS Requirements 5.1.1.1 Corporate responsibility The organization shall define and implement corporate responsibility policies, including at a minimum an anti-bribery policy, an employee code of conduct, and an ethics escalation policy ("whistle-blowing policy"). 5.1.1.2 Process effectiveness and efficiency Top management shall review the product realization processes and support processes to evaluate and improve their effectiveness and efficiency. The results of the process review activities shall be included as input to the management review (see Section 9.3.2.1.). TV SD South Asia 25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 17

IATF 16949:2016 QMS Requirements 5.1.1.3 Process owners Top management shall identify process owners who are responsible for managing the organization's processes and related outputs. Process owners shall understand their roles and be competent to perform those roles (see ISO 9001, Section 7.2). TV SD South Asia 25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 18 IATF 16949:2016 QMS Requirements 5.2 Policy 5.2.2 Communicating the quality policy

The quality policy shall: a) be available and be maintained as documented information; b) be communicated, understood and applied within the organization; c) be available to relevant interested parties, as appropriate. TV SD South Asia 25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 19 IATF 16949:2016 QMS Requirements 5.3 Organizational roles, responsibilities and authorities Top management shall ensure that the responsibilities and authorities for relevant roles are assigned, communicated and understood within the organization. Top management shall assign the responsibility and authority for: a) ensuring that the quality management system conforms to the requirements of

this International Standard; b) ensuring that the processes are delivering their intended outputs; c) reporting on the performance of the quality management system and on opportunities for improvement (see 10.1), in particular to top management; d) ensuring the promotion of customer focus throughout the organization; e) ensuring that the integrity of the quality management system is maintained when changes to the quality management system are planned and implemented. TV SD South Asia 25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 20 IATF 16949:2016 QMS Requirements 5.3.1 Organizational roles, responsibilities and authorities-Supplemental Top management shall assign personnel with the responsibilities and authorities to ensure customer requirements are met

5.3.2 Responsibility and authority for product requirements and corrective actions TV SD South Asia 25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 21 IATF 16949:2016 QMS REQUIREMENTS Clause 6 Planning TV SD South Asia 25-May-15

TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 22 IATF 16949:2016 QMS Requirements 6 Planning 6.1 Actions to address risks and opportunities 6.1.1 When planning for the quality management system, the organization shall consider the issues referred to in 4.1 and the requirements referred to in 4.2 and determine the risks and opportunities that need to be addressed to: a) give assurance that the quality management system can achieve its intended result(s); b) enhance desirable effects; c) prevent, or reduce, undesired effects; d) achieve improvement. TV SD South Asia 25-May-15

TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 23 IATF 16949:2016 QMS Requirements 6.1.2 The organization shall plan: a) actions to address these risks and opportunities; b) how to: 1) integrate and implement the actions into its quality management system processes (see 4.4); 2) evaluate the effectiveness of these actions. Actions taken to address risks and opportunities shall be proportionate to the potential impact on the conformity of products and services. TV SD South Asia 25-May-15

TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 24 IATF 16949:2016 QMS Requirements 6.1.2 NOTE 1 Options to address risks can include avoiding risk, taking risk in order to pursue an opportunity, eliminating the risk source, changing the likelihood or consequences, sharing the risk, or retaining risk by informed decision. NOTE 2 Opportunities can lead to the adoption of new practices, launching new products, opening new markets, addressing new customers, building partnerships, using new technology and other desirable and viable possibilities to address the organizations or its customers needs. TV SD South Asia 25-May-15

TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 25 IATF 16949:2016 QMS Requirements 6.1.2.1 Risk analysis The organization shall include in its risk analysis, at a minimum, lessons learned from product recalls, product audits, field returns and repairs, complaints, scrap, and rework. The organization shall retain documented information as evidence of the results of risk analysis. TV SD South Asia 25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015

Slide 26 IATF 16949:2016 QMS Requirements 6.1.2.2 Preventive action The organization shall determine and implement action(s) to eliminate the causes of potential nonconformities in order to prevent their occurrence. Preventive actions shall be appropriate to the severity of the potential issues. The organization shall establish a process to lessen the impact of negative effects of risk including the following: a) determining potential nonconformities and their causes; b) evaluating the need for action to prevent occurrence of nonconformities: c) determining and implementing action needed; d) documented information of action taken; e) reviewing the effectiveness of the preventive action taken; utilizing lessons learned to prevent recurrence in similar processes (see ISO 9001, Section 7.1.6). TV SD South Asia 25-May-15

TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 27 IATF 16949:2016 QMS Requirements 6.1.2.3 Contingency plans The organization shall: a) identify and evaluate internal and external risks to all manufacturing processes and infrastructure equipment essential to maintain production output and to ensure that customer requirements are met; b) define contingency plans according to risk and impact to the customer; c) prepare contingency plans for continuity of supply in the event of any of the following: key equipment failures (also see Section 8.5.6.1.1); interruption from externally provided products, processes, and services; recurring natural disasters; fire; utility interruptions; labor shortages; or infrastructure disruptions: d) include, as a supplement to the contingency plans, a notification process to the customer and other interested parties for the extent and duration of any situation impacting customer operations; TV SD South Asia

25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 28 IATF 16949:2016 QMS Requirements 6.1.2.3 Contingency plans e) periodically test the contingency plans for effectiveness (e.g., simulations, as appropriate); f) conduct contingency plan reviews (at a minimum annually) using a multidisciplinary team including top management, and update as required; g) document the contingency plans and retain documented information describing any revision(s), including the person(s) who authorized the change(s). The contingency plans shall include provisions to validate that the manufactured product continues to meet customer specifications after the re-start of production following an emergency in which production was stopped and if the regular

shutdown processes were not followed. TV SD South Asia 25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 29 IATF 16949:2016 QMS Requirements 6.2 Quality objectives and planning to achieve them 6.2.1 The organization shall establish quality objectives at relevant functions, levels and processes needed for the quality management system. The quality objectives shall: a) be consistent with the quality policy; b) be measurable; c) take into account applicable requirements;

d) be relevant to conformity of products and services and to enhancement of customer satisfaction; e) be monitored; f) be communicated; g) be updated as appropriate. The organization shall maintain documented information on the quality objectives. TV SD South Asia 25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 30 IATF 16949:2016 QMS Requirements 6.2.2 When planning how to achieve its quality objectives, the organization shall determine: a) what will be done; b) what resources will be required;

c) who will be responsible; d) when it will be completed; e) how the results will be evaluated. TV SD South Asia 25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 31 IATF 16949:2016 QMS Requirements 6.2.2.1 Quality objectives and planning to achieve them - supplemental Top management shall ensure that quality objectives to meet customer requirements are defined, established, and maintained for relevant functions, processes, and levels throughout the organization. The results of the organization's review regarding interested parties and their relevant requirements shall be considered when the organization establishes its

annual (at a minimum) quality objectives and related performance targets (internal and external). TV SD South Asia 25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 32 IATF 16949:2016 QMS REQUIREMENTS Clause 7 Support TV SD South Asia 25-May-15

TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 33 IATF 16949:2016 QMS Requirements 7 Support 7.1.2 People The organization shall determine and provide the persons necessary for the effective implementation of its quality management system and for the operation and control of its processes. TV SD South Asia 25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 34

IATF 16949:2016 QMS Requirements 7.1.3 infrastructure The organization shall determine, provide and maintain the infrastructure necessary for the operation of its processes and to achieve conformity of products and services. NOTE Infrastructure can include: a) buildings and associated utilities; b) equipment, including hardware and software; c) transportation resources; d) information and communication technology. TV SD South Asia 25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 35

IATF 16949:2016 QMS Requirements 7.1.3.1 Plant, facility, and equipment planning The organization shall use a multidisciplinary approach including risk identification and risk mitigation methods for developing and improving plant, facility, and equipment plans. ln designing plant layouts, the organization shall: a) optimize material flow, material handling, and value-added use of floor space including control of nonconforming product, and b) facilitate synchronous material flow, as applicable. Methods shall be developed and implemented to evaluate manufacturing feasibility for new product or new operations. Manufacturing feasibility assessments shall include capacity planning. These methods shall also be applicable for evaluating proposed changes to existing operations. TV SD South Asia 25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015

Slide 36 IATF 16949:2016 QMS Requirements 7.1.3.1 Plant, facility, and equipment planning The organization shall maintain process effectiveness, including periodic reevaluation relative to risk, to incorporate any changes made during process approval, control plan maintenance (see Section 8.5.1.1), and verification on job setups (see Section 8.0.1.3). Assessments of manufacturing feasibility and evaluation of capacity planning shall be inputs to management reviews (see ISO 9001, Section 9.3). NOTE 1 These requirements should include the application of lean manufacturing principles. NOTE 2 These requirements should apply to on-site supplier activities, as applicable. TV SD South Asia 25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015

Slide 37 IATF 16949:2016 QMS Requirements 7.1 .4 Environment for the operation of processes The organization shall determine, provide and maintain the environment necessary for the operation of its processes and to achieve conformity of products and services. NOTE A suitable environment can be a combination of human and physical factors, such as: a) social (e.g. non-discriminatory, calm, non-confrontational); b) psychological (e.g. stress-reducing, burnout prevention, emotionally protective); c) physical (e.g. temperature, heat, humidity, light, airflow, hygiene, noise). These factors can differ substantially depending on the products and services provided. NOTE Where third-party certification to lSO 45001 (or equivalent) is recognized, it may be used to demonstrate the organization's conformity to the personnel safety aspects of this requirement. TV SD South Asia 25-May-15

TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 38 IATF 16949:2016 QMS Requirements 7.1.6 Organizational knowledge The organization shall determine the knowledge necessary for the operation of its processes and to achieve conformity of products and services. This knowledge shall be maintained and be made available to the extent necessary. When addressing changing needs and trends, the organization shall consider its current knowledge and determine how to acquire or access any necessary additional knowledge and required updates. TV SD South Asia 25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015

Slide 39 IATF 16949:2016 QMS Requirements 7.1.6 Organizational knowledge NOTE 1 Organizational knowledge is knowledge specific to the organization; it is generally gained by experience. It is information that is used and shared to achieve the organizations objectives. NOTE 2 Organizational knowledge can be based on: a) internal sources (e.g. intellectual property; knowledge gained from experience; lessons learned from failures and successful projects; capturing and sharing undocumented knowledge and experience; the results of improvements in processes, products and services); b) external sources (e.g. standards; academia; conferences; gathering knowledge from customers or external providers). TV SD South Asia 25-May-15

TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 40 IATF 16949:2016 QMS Requirements 7.2.3 Internal auditor competency The organization shall have a documented process(es) to verify that internal auditors are competent, taking into account any customer-specific requirements. For additional guidance on auditor competencies, refer to ISO '19011. The organization shall maintain a list of qualified internal auditors. Quality management system auditors, manufacturing process auditors, and product auditors shall all be able to demonstrate the following minimum competencies: a) understanding of the automotive process approach for auditing, including risk-based thinking; b) understanding of applicable customer-specific requirements; c) understanding of applicable ISO 9001 and IATF 16949 requirements related to the scope of the audit; d) understanding of applicable core tool requirements related to the scope of the audit;

e) understanding how to plan, conduct, report, and close out audit findings. TV SD South Asia 25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 41 IATF 16949:2016 QMS Requirements 7.2.3 Internal auditor competency Additionally, manufacturing process auditors shall demonstrate technical understanding of the relevant manufacturing process(es) to be audited, including process risk analysis (such as PFMEA) and control plan. Product auditors shall demonstrate competence in understanding product requirements and use of relevant measuring and test equipment to verify product conformity. where training is provided to achieve competency, documented information shall

be retained to demonstrate the trainer's competency with the above requirements. TV SD South Asia 25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 42 IATF 16949:2016 QMS Requirements 7.2.3 Internal auditor competency Maintenance of and improvement in internal auditor competence shall be demonstrated through: f) executing a minimum number of audits per year, as defined by the organization; and g) maintaining knowledge of relevant requirements based on internal changes (e.g., process technology, product technology) and external changes (e.g., lSO

9001, IATF 16949, core tools, and customer specific requirements). TV SD South Asia 25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 43 IATF 16949:2016 QMS Requirements 7.2.4 Second-party auditor competency The organization shall demonstrate the competence of the auditors undertaking the second-party audits. second-party auditors shall meet customer specific requirements for auditor qualification and demonstrate the minimum following core competencies, including understanding of: a) the automotive process approach to auditing, including risk based thinking; b) applicable customer and organization specific requirements; c) applicable ISO 9001 and IATF 16949 requirements related to the scope of the

audit; d) applicable manufacturing process(es) to be audited, including PFMEA and control plan; e) applicable core tool requirements related to the scope of the audit; f) how to plan, conduct, prepare audit reports, and close out audit findings. TV SD South Asia 25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 44 IATF 16949:2016 QMS Requirements 7.3 Awareness The organization shall ensure that persons doing work under the organizations control are aware of: a) the quality policy; b) relevant quality objectives;

c) their contribution to the effectiveness of the quality management system, including the benefits of improved performance; d) the implications of not conforming with the quality management system requirements. TV SD South Asia 25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 45 IATF 16949:2016 QMS Requirements 7.3.1 Awareness - supplemental The organization shall maintain documented information that demonstrates that all employees are aware of their impact on product quality and the importance of their activities in achieving, maintaining, and improving quality, including customer requirements and the risks involved for the customer with nonconforming product.

TV SD South Asia 25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 46 IATF 16949:2016 QMS Requirements 7.5.1.1 Quality management system documentation The organization's quality management system shall be documented and include a quality manual, which can be a series of documents (electronic or hard copy). The format and structure of the quality manual is at the discretion of the organization and will depend on the organization's size, culture, and complexity. lf a series of documents is used, then a list shall be retained of the documents that comprise the quality manual for the organization. TV SD South Asia

25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 47 IATF 16949:2016 QMS Requirements 7.5.1.1 Quality management system documentation The quality manual shall include, at a minimum, the following: a) the scope of the quality management system, including details of and justification for any exclusions; b) documented processes established for the quality management system, or reference to them; c) the organization's processes and their sequence and interactions (inputs and outputs), including type and extent of control of any outsourced processes; d) a document (i.e., matrix) indicating where within the organization's quality management system their customer-specific requirements are addressed.

NOTE A matrix of how the requirements of this Automotive QMS standard are addressed by the organization's processes may be used to assist with linkages of the organization's processes and this Automotive QMS. TV SD South Asia 25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 48 IATF 16949:2016 QMS Requirements 7.5.3.2.1 Record retention The organization shall define, document, and implement a record retention policy. The control of records shall satisfy statutory, regulatory, organizational, and customer requirements. Production part approvals, tooling records (including maintenance and ownership), product and process design records, purchase orders (if applicable), or contracts and amendments shall be retained for the length of time that the product is active

for production and service requirements, plus one calendar year, unless otherwise specified by the customer or regulatory agency. NOTE Production part approval documented information may include approved product, applicable test equipment records, or approved test data. TV SD South Asia 25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 49 IATF 16949:2016 QMS REQUIREMENTS Clause 8 Operation TV SD South Asia 25-May-15

TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 50 IATF 16949:2016 QMS Requirements 8.4 Control of externally provided processes, products and services 8.4.1 General The organization shall ensure that externally provided processes, products and services conform to requirements. The organization shall determine the controls to be applied to externally provided processes, products and services when: a) products and services from external providers are intended for incorporation into the organizations own products and services; b) products and services are provided directly to the customer(s) by external providers on behalf of the organization; c) a process, or part of a process, is provided by an external provider as a result of a decision by the organization. The organization shall determine and apply criteria for the evaluation, selection, monitoring of performance, and reevaluation of external providers, based on their ability to provide processes or products and services in accordance with requirements. The organization shall retain documented information of these activities and any necessary actions arising from the evaluations.

TV SD South Asia 25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 51 IATF 16949:2016 QMS Requirements 8.4.1.1 General - supplemental The organization shall include all products and services that affect customer requirements such as subassembly, sequencing, sorting, rework, and calibration services in the scope of their definition of externally provided products, processes, and services. TV SD South Asia 25-May-15

TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 52 IATF 16949:2016 QMS Requirements 8.4.1.2 Supplier selection process The organization shall have a documented supplier selection process. The selection process shall include: a) an assessment of the selected supplier's risk to product conformity and uninterrupted supply of the organization's product to their customers; b) relevant quality and delivery performance: c) an evaluation of the supplier's quality management system; d) multidisciplinary decision making; and e) an assessment of software development capabilities, if applicable. Other supplier selection criteria that should be considered include the following: - volume of automotive business (absolute and as a percentage of total business); - financial stability; - purchased product, material, or service complexity; - required technology (product or process);

- adequacy of available resources (e.9., people, infrastructure); design and development capabilities (including project management); manufacturing capability; change management process; business continuity planning (e.9., disaster preparedness, contingency planning); logistics process; customer service. TV SD South Asia 25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 53 IATF 16949:2016 QMS Requirements 8.4.1.3 Customer-directed sources (also known as "Directed-Buy") When specified by the customer, the organization shall purchase products, materials, or services from customer-directed sources. All requirements of Section 8.4 (except the requirements in IATF 16949, Section 8.4.1.2) are applicable to the organization's control of customer-directed sources unless specific agreements are otherwise defined by the contract between the organization and the customer.

TV SD South Asia 25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 54 IATF 16949:2016 QMS Requirements 8.4.2 Type and extent of control The organization shall ensure that externally provided processes, products and services do not adversely affect the organizations ability to consistently deliver conforming products and services to its customers. The organization shall: a) ensure that externally provided processes remain within the control of its quality management system; b) define both the controls that it intends to apply to an external provider and those it intends to apply to the resulting output;

c) take into consideration: 1) the potential impact of the externally provided processes, products and services on the organizations ability to consistently meet customer and applicable statutory and regulatory requirements; 2) the effectiveness of the controls applied by the external provider; d) determine the verification, or other activities, necessary to ensure that the externally provided processes, products and services meet requirements. TV SD South Asia 25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 55 IATF 16949:2016 QMS Requirements 8.4.2.3 Supplier quality management system development The organization shall require their suppliers of automotive products and services to develop, implement, and improve a quality management system certified to ISO

9001, unless otherwise authorized by the customer, with the ultimate objective of becoming certified to this Automotive QMS Standard. Unless otherwise specified by the customer, the following sequence should be applied to achieve this requirement: a) compliance to ISO 9001 through second-party audits; b) certification to ISO 9001 through third-party audits; unless otherwise specified by the customer, suppliers to the organization shall demonstrate conformity to ISO 9001 by maintaining a third party certification issued by a certification body bearing the accreditation mark of a recognized IAF MLA (international Accreditation Forum Multilateral Recognition Arrangement) member and where the accreditation body's main scope includes management system certification to ISO/lEC1702l TV SD South Asia 25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 56

IATF 16949:2016 QMS Requirements 8.4.2.3 Supplier quality management system development c) certification to ISO 9001 with compliance to other customer-defined QMS requirements (such as minimum Automotive Quality Management System Requirements for Sub-Tier Suppliers [MAQMSR) or equivalent) through secondparty audits; d) certification to lSO9001 with compliance to IATF 16949 through second-party audits; e) certification to 16949 through third-party audits (valid third-party certification of the supplier to IATF 16949 by an IATF-recognized certification body). TV SD South Asia 25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 57 IATF 16949:2016 QMS Requirements

8.4.2.4.1 Second- party audits The organization shall include a second-party audit process in their supplier management approach. Second-party audits may be used for the following: a) supplier risk assessment; b) supplier monitoring; c) supplier QN4S development: d) product audits: e) process audits. Based on a risk analysis, including product safety/regulatory requirements, performance of the supplier, and QMS certification level, at a minimum, the organization shall document the criteria for determining the need, type, frequency, and scope of second-party audits. The organization shall retain records of the second-party audit reports. lf the scope of the second-party audit is to assess the supplier's quality management system, then the approach shall be consistent with the automotive process approach. NOTE Guidance may be found in the IATF Auditor Guide and ISO 19011, AIAG, ANFIA, FIEV, SMMT, VDA TV SD South Asia 25-May-15

TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 58 IATF 16949:2016 QMS Requirements 8.4.2.5 Supplier development The organization shall determine the priority, type, extent, and timing of required supplier development actions for its active suppliers. Determination inputs shall include but not limited to are following, a) performance issues identified through supplier monitoring (see Section 8.4.2.4); b) second-party audit findings (see Section g.4.2.4.1); c) third-party quality management system certification status; d) risk analysis. The organization shall implement actions necessary to resolve open (unsatisfactory) performance issues and pursue opportunities for continual improvement. TV SD South Asia 25-May-15

TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 59 IATF 16949:2016 QMS Requirements 8.4.3 Information for external providers The organization shall ensure the adequacy of requirements prior to their communication to the external provider. The organization shall communicate to external providers its requirements for: a) the processes, products and services to be provided; b) the approval of: 1) products and services; 2) methods, processes and equipment; 3) the release of products and services; c) competence, including any required qualification of persons; d) the external providers interactions with the organization; e) control and monitoring of the external providers performance to be applied by the organization; f) verification or validation activities that the organization, or its customer, intends to perform at the

external providers premises. TV SD South Asia 25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 60 IATF 16949:2016 QMS Requirements 8.5.1.2 Standardized work - operator instructions and visual standards The organization shall ensure that standardized work documents are: a) communicated to and understood by the employees who are responsible for performing the work; b) legible; c) presented in the language(s) understood by the personnel responsible to follow them; d) accessible for use at the designated work area(s). The standardized work documents shall also include rules for operator safety.

TV SD South Asia 25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 61 IATF 16949:2016 QMS Requirements 8.5.1.4 Verification after shutdown The organization shall define and implement the necessary actions to ensure product compliance with requirements after a planned or unplanned production shutdown period TV SD South Asia 25-May-15

TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 62 IATF 16949:2016 QMS Requirements 8.5.1.5 Total productive maintenance The organization shall develop, implement and maintain a documented total productive maintenance system. At a minimum, the system shall include the following: a) identification of process equipment necessary to produce conforming product at the required volume; b) availability of replacement parts for the equipment identified in item; c) provision of resource for machine, equipment, and facility maintenance: d) packaging and preservation of equipment, tooling, and gauging; e) applicable customer-specific requirements; TV SD South Asia

25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 63 IATF 16949:2016 QMS Requirements 8.5.1.5 Total productive maintenance f) documented maintenance objectives, for example: OEE (Overall Equipment Effectiveness)' MTBF (Mean Time Between Failure), and MTTR (Mean Time to Repair)' and Preventive Maintenance compliance metrics. Performance to the maintenance objectives shall form an input into management review (see ISO 9001, Section 9 3); g) regular review of maintenance plan and objectives and a documented action plan to address corrective actions where objectives are not achieved; h) use of preventive maintenance methods; i) use of predictive maintenance methods, as applicable; j) periodic overhaul.

TV SD South Asia 25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 64 IATF 16949:2016 QMS Requirements 8.5.1.7 Production scheduling The organization shall ensure that production is scheduled in order to meet customer orders/demands such as Just-in-Time (JlT) and is supported by an information system that permits access to production information at key stages of the process and is order driven. The organization shall include relevant planning information during production scheduling, e.g., customer orders, supplier on-time delivery performance, capacity, shared loading (multi-part station), lead time, inventory level, preventive maintenance, and calibration.

TV SD South Asia 25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 65 IATF 16949:2016 QMS Requirements 8.5.2.1 identification and traceability - supplemental These plans shall define the appropriate traceability systems, processes, and methods by product, process, and manufacturing location that: a) enable the organization to identify nonconforming and/or suspect product; b) enable the organization to segregate nonconforming and/or suspect product; c) ensure the ability to meet the customer and/or regulatory response time requirements; d) ensure documented information is retained in the format (electronic, hardcopy, archive) that enables the organization to meet the response time requirements; e) ensure serialized identification of individual products, if specified by the

customer or regulatory standards; f) ensure the identification and traceability requirements are extended to externally provided products with safety/regulatory characteristics. TV SD South Asia 25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 66 IATF 16949:2016 QMS Requirements 8.5.3 Property belonging to customers or external providers The organization shall exercise care with property belonging to customers or external providers while it is under the organizations control or being used by the organization. The organization shall identify, verify, protect and safeguard customers or external providers property provided for use or incorporation into the products and services. When the property of a customer or external provider is lost, damaged or otherwise found to be unsuitable for use, the organization shall report this to the customer or

external provider and retain documented information on what has occurred. NOTE A customers or external providers property can include materials, components, tools and equipment, premises, intellectual property and personal data. TV SD South Asia 25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 67 IATF 16949:2016 QMS Requirements 8.5.6.1.1 Temporary change of process controls The organization shall identify, document, and maintain a list of the process controls, including inspection, measuring, test, and error-proofing devices, that includes the primary process control and the approved back-up or alternate methods. The organization shall document the process that manages the use of alternate control methods. The organization shall include in this process, based on risk analysis (such as FMEA), severity, and the internal approvals to be obtained prior to production implementation of the alternate control method.

Before shipping product that was inspected or tested using the alternate method, if required, the organization shall obtain approval from the customer(s). The organization shall maintain and periodically review a list of approved alternate process control methods that are referenced in the control plan. Standard work instructions shall be available for each alternate process control method. TV SD South Asia 25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 68 IATF 16949:2016 QMS Requirements 8.5.6.1.1 Temporary change of process controls The organization shall review the operation of alternate process controls on a daily basis, at a minimum, to verify implementation of standard work with the goal to return to the standard process as defined by the control plan as soon as possible. Example methods

include but are not limited to the following: a) daily quality focused audits (e.g., layered process audits, as applicable); b) daily leadership meetings. Restart verification is documented for a defined period based on severity and confirmation that all features of the error-proofing device or process are effectively reinstated. The organization shall implement traceability of all product produced while any alternate process control devices or processes are being used (e.g., verification and retention of first piece and last piece from every shift). TV SD South Asia 25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 69 IATF 16949:2016 QMS Requirements 8.7 Control of nonconforming outputs 8.7.1

The organization shall ensure that outputs that do not conform to their requirements are identified and controlled to prevent their unintended use or delivery. The organization shall take appropriate action based on the nature of the nonconformity and its effect on the conformity of products and services. This shall also apply to nonconforming products and services detected after delivery of products, during or after the provision of services. The organization shall deal with nonconforming outputs in one or more of the following ways: a) correction; b) segregation, containment, return or suspension of provision of products and services; c) informing the customer; d) obtaining authorization for acceptance under concession. Conformity to the requirements shall be verified when nonconforming outputs are corrected. TV SD South Asia 25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 70

IATF 16949:2016 QMS Requirements 8.7.1.1 Customer authorization for concession The organization shall obtain a customer concession or deviation permit prior to further processing whenever the product or manufacturing process is different from that which is currently approved. The organization shall obtain customer authorization prior to further processing for "use as is" and rework dispositions of nonconforming product. lf sub-components are reused in the manufacturing process, that sub-component reuse shall be clearly communicated to the customer in the concession or deviation permit. The organization shall maintain a record of the expiration date or quantity authorized under concession. The organization shall also ensure compliance with the original or superseding specifications and requirements when the authorization expires. Material shipped under concession shall be properly identified on each shipping container (this applies equally to purchased product). The organization shall approve any requests from suppliers before submission to the customer. TV SD South Asia 25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015

Slide 71 IATF 16949:2016 QMS Requirements 8.7.1.2 Control of nonconforming product - customer-specified process The organization shall comply with applicable customer-specified controls for nonconforming product(s). 8.7.1.3 Control of suspect product The organization shall ensure that product with unidentified or suspect status is classified and controlled as nonconforming product. The organization shall ensure that all appropriate manufacturing personnel receive training for containment of suspect and nonconforming product. TV SD South Asia 25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015

Slide 72 IATF 16949:2016 QMS Requirements 8.7.1.4 Control of reworked product The organization shall utilize risk analysis (such as FMEA) methodology to assess risks in the rework process prior to a decision to rework the product. lf required by the customer, the organization shall obtain approval from the customer prior to commencing rework of the product. The organization shall have a documented process for rework confirmation in accordance with the control plan or other relevant documented information to verify compliance to original specifications. instructions for disassembly or rework, including re-inspection and traceability requirements, shall be accessible to and utilized by the appropriate personnel. The organization shall retain documented information on the disposition of reworked product including quantity, disposition, disposition date, and applicable traceability information. TV SD South Asia 25-May-15

TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 73 IATF 16949:2016 QMS Requirements 8.7.1.5 Control of repaired product The organization shall utilize risk analysis (such as FMEA) methodology to assess risks in the repair process prior to a decision to repair the product. The organization shall obtain approval from the customer before commencing repair of the product. The organization shall have a documented process for repair confirmation in accordance with the control plan or other relevant documented information. instructions for disassembly or repair, including re-inspection and traceability requirements, shall be accessible to and utilized by the appropriate personnel. The organization shall obtain a documented customer authorization for concession for the product to be repaired. The organization shall retain documented information on the disposition of repaired product including quantity, disposition, disposition date, and applicable traceability information. TV SD South Asia

25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 74 IATF 16949:2016 QMS Requirements 8.7.1.6 Customer notification The organization shall immediately notify the customer(s) in the event that nonconforming product has been shipped. initial communication shall be followed with detailed documentation of the event. 8.7.1.7 Nonconforming product disposition The organization shall have a documented process for disposition of nonconforming product not subject to rework or repair. For product not meeting requirements, the organization shall verify that the product to be scrapped is rendered unusable prior to disposal. The organization shall not divert nonconforming product to service or other use without prior customer approval. TV SD South Asia

25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 75 IATF 16949:2016 QMS REQUIREMENTS Clause 9 Performance Evaluation TV SD South Asia 25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 76

IATF 16949:2016 QMS Requirements 9.1.1.3 Application of statistical concepts statistical concepts, such as variation, control (stability), process capability, and the consequences of over-adjustment, shall be understood and used by employees involved in the collection, analysis, and management of statistical data. TV SD South Asia 25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 77 IATF 16949:2016 QMS Requirements 9.1.3.1 Prioritization Trends in quality and operational performance shall be compared with progress toward objectives and lead to action to support prioritization of actions for improving customer satisfaction.

TV SD South Asia 25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 78 IATF 16949:2016 QMS Requirements 9.2.2.2 Quality management system audit The organization shall audit all quality management system processes over each three-year calendar period, according to an annual program, using the process approach to verify compliance with this Automotive QMS Standard. integrated with these audits, the organization shall sample customer-specific quality management system requirements for effective implementation. TV SD South Asia

25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 79 IATF 16949:2016 QMS Requirements 9.2.2.3 Manufacturing process audit The organization shall audit all manufacturing processes over each three-year calendar period to determine their effectiveness and efficiency using customerspecific required approaches for process audits. Where not defined by the customer, the organization shall determine the approach to be used. Within each individual audit plan, each manufacturing process shall be audited on all shifts where it occurs, including the appropriate sampling of the shift handover. The manufacturing process audit shall include an audit of the effective implementation of the process risk analysis (such as PFMEA), control plan, and associated documents. TV SD South Asia

25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 80 IATF 16949:2016 QMS Requirements 9.3.2 Management review inputs The management review shall be planned and carried out taking into consideration: a) the status of actions from previous management reviews; b) changes in external and internal issues that are relevant to the quality management system; c) information on the performance and effectiveness of the quality management system, including trends in: 1) customer satisfaction and feedback from relevant interested parties; 2) the extent to which quality objectives have been met; 3) process performance and conformity of products and services; 4) nonconformities and corrective actions; 5) monitoring and measurement results; 6) audit results;

7) the performance of external providers; d) the adequacy of resources; e) the effectiveness of actions taken to address risks and opportunities (see 6.1); f) opportunities for improvement. TV SD South Asia 25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 81 IATF 16949:2016 QMS Requirements 9.3.2.1 Management review inputs - supplemental input to management review shall include: a) cost of poor quality (cost of internal and external nonconformance); b) measures of process effectiveness; c) measures of process efficiency: d) product conformance;

e) assessments of manufacturing feasibility made for changes to existing operations and for new facilities or new product (see Section 7.1.3); f) customer satisfaction (see ISO 9001, Section 9.1.2); g) review of performance against maintenance objectives; h) warranty performance (where applicable); i) review of customer scorecards (where applicable); j) identification of potential field failures identified through risk analysis (such as FMEA); k) actual field failures and their impact on safety or the environment. TV SD South Asia 25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 82 IATF 16949:2016 QMS REQUIREMENTS Clause 10

Improvement TV SD South Asia 25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 83 IATF 16949:2016 QMS Requirements 10.2 Nonconformity and corrective action 10.2.1 When a nonconformity occurs, including any arising from complaints, the organization shall: a) react to the nonconformity and, as applicable: 1) take action to control and correct it; 2) deal with the consequences; b) evaluate the need for action to eliminate the cause(s) of the nonconformity, in order that it does not recur or occur elsewhere, by: 1) reviewing and analyzing the nonconformity;

2) determining the causes of the nonconformity; 3) determining if similar nonconformities exist, or could potentially occur; c) implement any action needed; d) review the effectiveness of any corrective action taken; e) update risks and opportunities determined during planning, if necessary; f) make changes to the quality management system, if necessary. Corrective actions shall be appropriate to the effects of the nonconformities encountered. TV SD South Asia 25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 84 IATF 16949:2016 QMS Requirements 10.2.5 Warranty management systems when the organization is required to provide warranty for their product(s), the organization shall implement a warranty management process. The organization

shall include in the process a method for warranty part analysis, including NTF (no trouble found). when specified by the customer, the organization shall implement the required warranty management process. TV SD South Asia 25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 85 End of the Session TV SD South Asia 25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015

Slide 86 Changes as per 5th edition of IATF Rules New certification rules, 5th edition, Revision: 05 November 2016 All certification activities (audits) that will occur from 1st Jan 2017 have to be performed according to the new certification rules. Work Extensions are now allowed TV SD South Asia 13-02-01 Management Systems Slide 87 Latest Core Tools

APQP 2nd Edition SPC -2nd Edition MSA -4th Edition PPAP- 4th Edition FMEA 4th Edition TV SD South Asia 13-02-01 Management Systems Slide 88 Thank you for your time. www.tuv-sud.in [email protected]

TV TVSD SDSouth Asia 25-May-15 TS IA Ed 2015 Rev 0 - 25.05.2015 Slide 89 Slide 89

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