Defense Logistics Agency Product Quality Deficiency Program

Book excerpt: We initiated the audit in response to a request from the Director, Defense Logistics Agency. He was interested in improving the product quality deficiency report system, which is used by DoD Components to identify and purge nonconforming material from inventory and to provide information to contracting officers, contractors, and customers. Nonconforming material is a defective supply item that cannot be used for its designed purpose because of material, manufacturing, or workmanship defects. The product quality deficiency program enables DoD customers to report defects to the buying commands, who then investigate the complaints, exchange deficiency information for corrective actions through the acquisition and support process, and maintain contractor quality history to be used for Government best value contractor source selection. From October 1, 1995 through April 30, 1997, 17,051 product quality deficiencies were reported to the Defense inventory control points for investigation and determination. The overall objective of the audit was to evaluate the product - quality deficiency report program used by DoD components; however, we limited the audit to include only the Defense Logistics Agency product quality deficiency program. Specifically, we determined whether defective products were reported by customers; and if reported, whether they were promptly investigated and corrected. We also reviewed DoD progress in establishing and implementing the DoD-wide Deficiency Reporting System Program. We also evaluated the adequacy of management controls applicable to the product quality deficiency report program.