As Murphy’s law says: if something can go wrong it will. Perhaps it should be adapted to: if somebody can do wrong they will (or maybe that was the implicit meaning).
Even with all the checks in place: testing random samples, design integrity test and 100% on line critical function test shipments still go wrong from time to time, and I am putting the emphasis on shipments. During shipping temperatures and humidity go up for several weeks inside the container, anything under stress (by design or not), vulnerable to humidity and humidity related effects will undergo some type of material degradation, sometimes even causing chemical reactions with the product losing some or all structural integrity or some other function.
The Temperature Humidity test is supposed to catch this weak spot but then only a few samples are tested because it’s time consuming (24-96 hours) with limited test capacity. Picture this scenario now: somebody somewhere in the organization decides to: 1) replace the adhesive with a cheaper – no brand alternative – to save a few pennies, 2) an old batch of poorly stored and expired adhesive will be used up first, 3) there is serious dimensional variation affecting the adhesive strength 4) the curing time was too short during the night shift, 5) the surfaces didn’t get properly cleaned, 6) variation in the tool texture caused the adhesion surfaces to be too smooth for certain cavities
Whichever the cause the results can be disastrous, way beyond replacement value of the product (and that is represented as a gesture of goodwill), but that’s all you can recuperate unless: critical material and performance specifications are in the PO at the very minimum. This is what I recently learned from 2 US lawyers in Shenzhen: a customer can successfully sue for – lost revenue – , substantially more than replacement value, if any if the documented specifications in the PO or contract are not met. This also implies that putting these specifications on engineering drawings, although important, bear no legal significance, at least not in China.
I have known program managers who put product build readiness in the contract: if the ODM for whatever reason causes a delay or serious quality issues for a trial build, the ODM is on the hook for the travel expenses of the entire team. Now if a PO would just have the critical specifications in there, and the consequences of not meeting them would be clearly lined out, I am sure some pencils would be sharpened. In general most decent factories have very good work instructions with good and bad practices both documented in a very visual and easy to understand way. But any production batch starting from thousands of units and up will have statistical variations coming from all directions that have to be addressed, and that doesn’t even include human individual decisions or errors.
I am sure that every customer prefers to have perfect quality products rather than taking the suppliers to court for lost revenue, but with the risks going up for the supplier they might take some extra measures, and make this part of the standard procedures (that’s a Kaizen right?). If you look at higher volume forward looking factories they’re using work cells rather than assembly lines. Work cells are accountable for performance and yield as a unit, work cells also look more organized with better component flows, the accountability and visibility however have the most impact in my opinion.