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Shobhendu Prabhakar

Standards

Nonconformance Reports: Friends, Not Foes

They’re not problems but rather opportunities for improvement

Published: Tuesday, May 2, 2017 - 12:03

Whenever the term “nonconformance report” (NCR) comes into project home offices or construction and fabrication sites, it is often seen as a negative, and personnel are typically reluctant to accept it as a positive and powerful tool to improve. Perhaps, the “non” in nonconformance is the reason for this. This article explains why NCRs should be seen as friends rather than a foes, and how they can be used to improve a company’s projects, products, and services as well as its overall performance.

First of all, why are NCRs your friends? Here's a short list:

• Having NCRs mean the company’s quality management system (QMS) and its quality department are performing as they should. Isn’t that positive rather than negative? In fact, an absence of NCRs should be looked at critically by management teams to verify whether the QMS is working as intended. Perhaps personnel are afraid of reporting nonconformances.
• NCRs provide opportunities to look at problems objectively.
• If considered objectively, NCRs press personnel to think and identify root causes of problems, take necessary corrective actions, and more important, consider what can be done differently to prevent recurrence of the same or similar type of problems (preventive actions).
• NCRs provide early symptoms to problems that might become bigger systemic issues if not addressed in a timely fashion.
• Early identification and resolution of NCRs often save companies millions of dollars.
• Done properly, NCRs typically focus on process correction and opportunities for improvements, as opposed to blaming problems on personnel.
• Analysis of NCRs provide companies with useful data to identify trends and take necessary actions based on them.
• Assigning dollar value to address problems identified in NCRs provides data to company management about costs that could have been been avoided or the money that can be saved in the future by taking necessary corrective and preventive actions.
• Often NCRs provide avenues to resolve interpretation issues with specifications, industry codes, and procedures.
• NCRs have the potential to enhance a quality culture within the company if the message is clear and relayed with a positive note to the personnel.

Management, of course, plays a key role in making sure NCRs are dealt with properly. What should they do? Here are some suggestions:
• Look at NCRs objectively and positively.
• Analyze why the problem is occurring to correctly identify root causes behind the nonconformance. Involve relevant and competent personnel in the root-cause identification exercise.
• Categorically see whether this is a process issue, personnel competency issue, supply-chain management problem, or something else.
• Identify and apply short-term corrective actions based on the root cause to resolve the nonconformance. Don’t simply apply a bandage.
• Come up with long-term corrective and preventive actions to prevent recurrence of the issue at hand.
• Clearly assign who will be responsible for taking short-term corrective actions and long-term corrective and preventive actions.
• Set a frequency to objectively look at NCR data with company, product line, project management, department management, and service management teams. Analyze these data for lessons learned and what can and should be done differently.
• If possible, quantify each nonconformance with a dollar value to see cost impact.

Unfortunately, NCRs are often used improperly. Rather than being used as a tool to improve a process, they are used to assign blame without looking at the root cause of the issue. Here are some things you don’t want to do with NCRs:
• NCRs should not be seen or perceived as an indication of poor performance of a function or department.
• NCRs should not be used as a performance measure of personnel.
• Don’t use NCRs to blame personnel for the problems at hand.
• Resist quick fixing or applying a bandage to the nonconformance without proper identification of root causes.

In conclusion, NCRs should not be perceived by personnel as foes aimed to blame them for problems or be used as performance measures for functions and departments. Instead, NCRs should be perceived by company, product line, project, product, and service management teams as friends that are:
• Trying to identify the root cause of a problem at hand
• Used as a process correction and improvement mechanism
• Useful data for telling a story about trends and early symptoms of a problem that can become bigger if not addressed
• Cost-saving tools

Discuss

About The Author

Shobhendu Prabhakar’s picture

Shobhendu Prabhakar

Shobhendu Prabhakar is working with TechnipFMC in a project quality manager role. He holds a bachelor’s degree in mechanical engineering, a master’s degree in mechanical design engineering, and a master’s degree in business administration. He is a Jones Scholar (Rice University in Houston) and a certified ISO 9001 lead auditor with 14+ years of professional experience in quality assurance in oil and gas industries. This article does not represent any TechnipFMC position, and it is in no way related to TechnipFMC.