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STANDARD OPERATING PROCEDURE

FOR THE

ASSESSMENT OF VENDORS (EXTERNAL PROVIDERS)

CARIRI CONTROlltO DOCUMtNT

NOT TO BE COPIED

Authorised by: Chief Executive Officer

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DOCUMENT CHANGE HISTORY

Date of
Pg# Section Comment/Reason for Change Brief Description of Change
Change

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1.0 PURPOSE

This procedure is to ensure that vendors are adequately evaluated and approved for the
provision of products and services to CARIRI based on key factors including their ability
to safely execute the job.

2.0 SCOPE

This procedure covers all vendors whose products and services impact directly on the
quality of CARlRI 's products and services as well as the health, safety and environment
of employees.

3.0 RESPONSIBILITIES

3. l The Chief Executive Officer ( CEO) is responsible for:

• The final determination of the recommendations of the Vendor Assessment

Committee.

• Selecting the auxiliary members of the Vendor Assessment Committee

3.2 The Section Head, Procurement is responsible for:

• Liaising with CARIRI Management to ensure that this process is fulfilled efficiently.

• Communicating CAR1Rl's expectations and assessment process to external providers

and keeping records to support the External Provider Assessment process.

3.3 Section Heads are responsible for notifying the Section Head, Procurement of
underperforming contractors or fai lure of materials supplied.

3.4 The Vendor Assessment Committee is responsible for:

• Assessing each completed Vendor (External Provider) Registration Form and

recommending whether (and for which products and services) an external provider
should be added to the Approved Vendors (External Providers) List.

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• Making recommendations based the results of the Vendor Evaluation whether to:
a. Remove Vendor from Approved Vendor List
b. Monitor Vendor performance for a defined period
c. Retain Vendor on Approved Vendor List

3.5 The Safety Officer is responsible for:

• Advising Management on the HSE requirements for external providers and

• Conducting inspections as necessary to determine their capabi lities to perform the job
safely.

4.0 REFERENCES

4.1 ISO 900I:2015 Section 8.4 - Externally Provided Processes, Products and Services
4.2 Business Process Manual Section 8 - Core Processes

5.0 DEFINITIONS

5.1 External Provider - A supplier or potential supplier of products or services to CARIRI.

The term can be used interchangeably w ith the word Vendor.

5.2 Vendor Assessment Committee - a committee comprising of a minimum of the

Corporate Secretary; Head of Procurement; Executive Manager; Corporate Services and
the Safety Officer. This committee makes recommendations to the CEO on the suitability
of external providers to provide goods and services to the Institute. The CEO appoints
other persons (auxi liary members) from relevant specialist areas and backgrounds to the
Committee.

6.0 PROCEDURE

Inputs
• Registration - Completed vendor Registration Form
• Evaluation - Approved Vendor's List

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Output
• Approved Vendors List

Section A. Vendor Registration

1. In order to become an approved external provider, a Vendors (External Provider)

Registration Form (PROC.F.04) must be completed and submitted to the Vendor
Assessment Committee to be assessed using the following criteria where applicable:

• References from External Provider's customers

• Quality of samples provided
• External Provider's quality assurance/Management system
• Competency of staff e.g. experience, qualifications
• External Provider' s HSE Management System
• Perceived financ ial strength of the External Provider
• Other criteria which may affect the External Provider' s ability to continually meet
CARIRI ' s specifications.

2. The detai Is of the assessment are documented and retained.

3. A recommendation is sent to Executive Management who approves the vendor to be

added to the Approved Vendors (External Providers) List. This is communicated to
the vendor by the Section Head, Procurement who also informs them that their
continued status is dependent on satisfactory performance and their approval expires
with in five years from approval date.

Section B. Vendor Evaluation

I. At least once per year, vendors from the Approved Vendors List are selected for re-
evaluation according to the Selection Criteria (see Appendix I). This list is sent to
relevant Section Heads for their comments on the performance of the vendors with
which they dealt.

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Note: At any time during the provision of goods and services, poor performance by a
vendor is to be reported to Section Head, Procurement Department without delay by
the affected Section Head on the Vendor Complaints Form (PROC.F.08).

2. The Section Head, Procurement Department then prepares and submits a report to the
Vendor Assessment Committee wh ich re-evaluates the vendors on the list.
Depending on the contents of the report, the Committee makes recommendations for
external providers to remain on the List, be monitored for a period or be removed
from the List. The Head , Procurement communicates any issues of non-compliance to
the vendor and requests information on any actions to be taken.

3. The Committee reviews the corrective actions taken and determines whether to
recommend retention on or removal from the Approved Vendors (External Providers)
List.

4. The recommendations of the Committee are sent to the Executive Management for
approval. Approvals for retention on the list (yearly assessment approvals) are valid
for one year. The Approved Vendors (External Providers) List is updated
accordingly.

5. External Providers are informed of their evaluations and related status on the
Approved Vendors (External Providers) List by the Head of Procurement. If an
External Provider is removed due to under-performance, the Head of Procurement
sends a letter informing them of this action and of their ineligibility to re-app ly for
approval before six months from the date of the letter.

6. Vendor performance is repo1ted on during the annual Management Review Meeting.

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C. Vendor Re-Registration

I. Once every 5 years, the Head of Procurement sends a letter to each external provider
on the Approved Vendors (External Providers) List advising them of the approaching
expiry of their registration and the need for re-registration. The re-registration process
fo llows the registration process as detailed in Section A above.

2. External Providers who have not responded wou ld be removed from the listing until
they have satisfied the External Provider Re-registration process.

7.0 RELATED DOCUMENTED INFORMATION

7.1 Vendor Registration Form (PROC.F.04)

7.2 Vendor Complaints Form (PROC.F.08)
7.3 Approved Vendors (External Providers) List (PROC.LST.01)
7.4 Minutes of Vendor Assessment Committee Meetings

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APPENDIX I

SELECTION CRITERIA FOR EXTERNAL PROVIDER RE-EVALUATION

External Providers are selected for evaluation based on the volume of purchase orders and dollar
value of purchase orders.
For the period under consideration, external providers are stratified based on:-
• Volume of orders: A minimum of the top twenty (20) of these external providers are selected
for evaluation.
• Dollar value of orders: At least the top five (5) of these External Providers are selected for
evaluation.
Since the two above groups are not mutually exclusive, the total number evaluated can be less
than 25.

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