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1 Rheem Manufacturing Company Fort Smith, Arkansas Original Release: 4/06/09 Revision Date: 10/25/16

2 Quality Management System D. Presley 05 1 of 1 Manual Contents A. Johnson 10/25/16 0 Section Title Revision 0 Quality Management System Manual Contents 5 1 Quality Management System 1 2 Planning 0 3 Management Responsibility 0 4 Organizational Responsibilities 0 5 Management Review 0 6 Documentation Requirements 0 7 Resource Management 0 8 Product Realization 0 9 Customer Related Processes (Contract Review) 1 10 Design and Development 0 11 Purchasing 2 12 Production and Service Provision 0 13 Control of Monitoring and Measuring Equipment 0 14 Measurement, Analysis and Improvement 0 15 Monitoring and Measurement 1 16 Control of Nonconforming Product 0 17 Analysis of Data 0 18 Improvement 0 19 Glossary 0

3 Quality Management System D. Graham 01 1 of 3 C. Peel 8/15/ PURPOSE The purpose of this section is to specify Rheem Manufacturing Company s requirements for a Quality Management System (QMS) in order to demonstrate its ability to consistently provide product that meets customer and applicable regulatory requirements, and aims to enhance customer satisfaction. 2.0 REFERENCE DOCUMENTS 2.1 ISO 9001:2008 Clauses 1.0, 4.1 and Quality Management System Manual Section 7, Resource Management 2.3 Quality Management System Manual Section 11, Purchasing 2.4 Quality Management System Manual Section 14, Management, Analysis and Improvement 2.5 Quality Management System Manual Section 15, Monitoring and Measurement 2.6 Quality Management System Manual Section 16, Control of Nonconforming Product 2.7 Quality Management System Manual Section 17, Analysis of Data 2.8 Quality Management System Manual Section 18, Improvement 3.0 DEFINITIONS 3.1 See Section 19, Glossary, for definitions. 4.0 QMSM REQUIREMENTS 4.1 Scope Top management of Rheem Manufacturing Company has specified the requirements for the Rheem Manufactruring Company s QMS which will demonstrate their: a) ability to consistently provide product that meets customer and applicable regulatory requirements, and b) aim to enhance customer satisfaction through the effective application of the QMS, including processes for continual improvement of the system and the assurance of conformity to customer and applicable statutory and regulatory requirements. 4.2 General Rheem Manufacturing Company has established, documented and implemented a QMS. Rheem Manufacturing Company continually improves its effectiveness in accordance with the requirements of the ISO 9001:2008 Standard. Rheem Manufacturing Company maintains its QMS by: a) determine the processes needed for its QMS and their application throughout the organization, b) determining the sequence and interaction of these processes, c) determining the criteria and methods needed to ensure that both the operation and control of these processes are effective, d) ensuring the availability of resources, per Reference 2.2, and information necessary to support the operation and monitoring of these processes, e) monitoring, measuring and analyzing these processes, per References , and f) implementing actions necessary to achieve planned results and continual improvement of these processes.

4 Quality Management System D. Graham 01 2 of 3 C. Peel 8/15/ Rheem Manufacturing Company manages the QMS processes in accordance with the requirements of the ISO 9001:2008 Standard. Rheem Manufacturing Company does not outsource any process affecting product conformity with these requirements. Should any process be outsourced, Rheem Manufacturing Company shall identify and ensure control of such processes. 4.3 Quality Policy This manual is issued to describe the quality system employed by Rheem Manufacturing Company. This manual and the systems and processes: a) are appropriate to the purpose of the organization, b) includes a commitment to comply with requirements and continually improve the effectiveness of the QMS, c) provides a framework for establishing and reviewing quality objectives, d) are communicated and understood within the organization, e) are reviewed for continuing suitability. The following is the Quality Policy adopted by Rheem Manufacturing Company: It is our policy to promote a culture of continual improvement that is committed to exceeding customer expectations and requirements, by providing products and services of excellent quality. Our quality policy means that Rheem Manufacturing Company will provide superior products while continually improving the QMS to enhance customer satisfaction. 4.4 Quality Policy Implementation The ways in which Rheem Manufacturing Company s quality policy is implemented include: a) our commitment to continual improvement, b) making the quality policy available, c) providing a framework for establishing and reviewing objectives, d) review of the QMS by top management, e) audits of the QMS, f) the appointment of a quality management representative, g) the organization, responsibility, authority and interfaces of various functions being defined and documented, h) our equipment and facilities being suited for their intended purpose, i) our employees possessing sound skills in their own areas of responsibility and being offered the opportunity for the necessary training to ensure that they are capable to achieve quality in the work they perform.

5 Quality Management System D. Graham 01 3 of 3 C. Peel 8/15/ Quality Objectives It is the responsibility of Rheem s top management to ensure that the quality objectives, including those needed to meet work related requirements and in support of the organizational objectives, are established at relevant functions and levels within the organization. These objectives are measurable and consistent with the quality policy. The overall quality objectives are as follows: a) Improve supplier related product and reduce supplier quality cost, b) Reduce warranty cost, c) Improve the effectiveness of the Quality Management System d) Improve manufacturing processes to prevent quality escapes, e) Provide quick response to customer quality issues 5.0 RESPONSIBILITIES It is top management s responsibility to ensure the quality policy is implemented and understood by all employees within the organization. 6.0 RECORDS None. 7.0 REVISION HISTORY Revision Description Effective Date 0 Initial issue of ISO 9001:2008 4/06/09 01 Revised the Quality Policy Statement 8/15/12

6 Planning D. Graham 0 1 of 2 B. Hanesworth 4/06/ PURPOSE This section establishes the planning of Rheem Manufacturing Company s Quality Management System. 2.0 REFERENCE DOCUMENTS 2.1 ISO 9001:2008 Clause Quality Management System Manual Section 1, Quality Management System General Requirements 2.3 Quality Management System Manual Section 8, Product Realization 3.0 DEFINITIONS 3.1 See Section 19, Glossary, for definitions. 4.0 QMSM REQUIREMENTS 4.1 Quality Management System Planning Rheem Manufacturing Company s top management ensures that: a) the planning of the Quality Management System is carried out in order to meet the requirements given per Reference 2.2, as well as the quality objectives, and b) the integrity of the Quality Management System is maintained when changes to the Quality Management System are planned and implemented. 4.2 Plan Development The appropriate Quality Engineer shall develop quality plans to determine the criteria and methods needed to ensure both the operation and control of these processes are effective for identified processes. These plans shall be prepared in conjunction with production. The following will be considered when formulating these control plans. a) the identification and acquisition of equipment, fixtures, gages, and skills that may be needed to achieve the required quality. b) the updating as necessary of quality control, inspection, and testing techniques. c) the identification of any measurement requirement. d) the identification of suitable verification at appropriate stages in the process. e) clarification of subjective standards. f) identification and preparation of quality records. All in-process inspections and testing is performed as described in control plans or inspection instructions. 5.0 RESPONSIBILITIES Quality Management System Planning is the responsibility of the Quality Assurance Department.

7 Planning D. Graham 0 2 of 2 B. Hanesworth 4/06/ RECORDS Records shall be maintained by the Quality Assurance Department. 7.0 REVISION HISTORY Revision Description Effective Date 0 Initial issue of ISO 9001:2008 4/06/09

8 Management Responsibility D. Graham 0 1 of 2 B. Hanesworth 4/06/ PURPOSE This section establishes top management s responsibilities with regard to the continual improvement of Rheem Manufacturing Company s Quality Management System (QMS). 2.0 REFERENCE DOCUMENTS 2.1 ISO 9001:2008 Clauses 5.1, 5.2 and Quality Management System Manual Section 1, QMS General Requirements 2.3 Quality Management System Manual Section 2, Planning 2.4 Quality Management System Manual Section 4, Organizational Responsibilities 2.5 Quality Management System Manual Section 5, Management Review 2.6 Quality Management System Manual Section 7, Resource Management 2.7 Quality Management System Manual Section 9, Customer-Related Processes 3.0 DEFINITIONS 3.1 See Section 19, Glossary, for definitions. 4.0 QMSM REQUIREMENTS 4.1 Management Commitment Top management provides evidence of its commitment to the development and implementation of the QMS, and to continually improving the effectiveness of the QMS, by: a) communicating to all Rheem Manufacturing Company employees the importance of meeting customer, statutory and regulatory requirements, b) establishing the quality policy, per Reference 2.2, and ensuring that this policy is understood by all Rheem Manufacturing Company employees, c) ensuring that the quality objectives, defined per Reference 2.3, are established and reviewed for continuing suitability and adequacy and, when necessary, the need for change, d) conducting management reviews, per Reference 2.5, and e) ensuring the availability of resources, per References 2.4 and Customer Focus Top management ensures that customer requirements are determined, per Reference 2.7. These requirements are met with the aim of enhancing the satisfaction of our customer. 4.3 Internal Communication Top management ensures that appropriate communication processes are established within the organization. These processes ensure that communication takes place regarding the effectiveness of the QMS. 5.0 RESPONSIBILITIES It is top management s responsibility to ensure customer focus and communications throughout the organization. 6.0 RECORDS None.

9 Management Responsibility D. Graham 0 2 of 2 B. Hanesworth 4/06/ REVISION HISTORY Revision Description Effective Date 0 Initial issue of ISO 9001:2008 4/06/09

10 Organizational Responsibilities D. Graham 0 1 of 2 B. Hanesworth 4/06/ PURPOSE This section defines the responsibilities and authorities of Rheem Manufacturing Company personnel for implementing and maintaining the Quality Management System (QMS). 2.0 REFERENCE DOCUMENTS 2.1 ISO 9001:2008 Clauses and DEFINITIONS 3.1 See Section 19, Glossary, for definitions. 4.0 QMSM REQUIREMENTS 4.1 Responsibility and Authority Top management within Rheem Manufacturing Company defines and communicates the responsibilities and authorities of all employees within the organization. Organizational relationships within the company are described in the organization charts located in the Division Vice Presidents' Offices and in the Plant Human Resources Department. These are updated annually to illustrate the relative authority of those people, who manage, perform, and verify work affecting quality. Specific responsibilities and authorities for each activity affecting quality are defined in the respective job description. 4.2 Management Representative Top management has appointed the organization s Management Representative for each facility who, irrespective of other responsibilities, has responsibility and authority that includes: a) ensuring that processes needed for the QMS are established, implemented, and maintained, b) reporting on the performance of the QMS to the Vice President of Operations, including any need for improvement, and c) ensuring the promotion and awareness of customer requirements throughout the Rheem Manufacturing Company organization. 4.3 Quality Assurance Manager The Quality Assurance Manager of each facility within the Air Conditioning Division will be the management representative for the ISO 9000 Quality Management System. The Management Representative is responsible for ensuring that the quality management system is established and maintained according to the ISO 9001 Standard, and has the following responsibilities: a) coordinate Quality Assurance requirements with other departments; b) ensure adequate training is given to Quality Department personnel; c) establish quality policies and procedures to meet contractual requirements; d) provide functional counseling and guidance on preparation of inspection and test plans; e) ensures the appropriate quality representative participates in design review; f) interpret quality requirements of contracts and notify affected areas of any changes; g) report on the performance of the quality system to management for review.

11 Organizational Responsibilities D. Graham 0 2 of 2 B. Hanesworth 4/06/09 4 The Quality Assurance Manager is responsible for chairing the Quality Management System Review Meeting. 4.4 Plant Manager The Plant Manager has executive responsibility for quality. He is ultimately responsible for each pertinent Rheem Facility's quality program. 4.5 Human Resource Manager The Human Resource Manager shall maintain job descriptions for each individual and training programs for the facility. 4.6 R&D Product Managers R&D Product Managers have the responsibility to ensure and maintain product quality design. 4.7 Purchasing The Purchasing Manager has the responsibility to analyze current, prospective and alternative sources of supply with regards to reliability, quality capability, and cost performance. 4.8 Plant Engineering The Plant Engineering Manager has the responsibility to ensure quality through the affective supervision of Plant Engineering and maintaining efficient mechanical operations of the plant. 5.0 RESPONSIBILITIES As defined above 6.0 RECORDS 6.1 Organization Charts. 6.2 Job Descriptions. 7.0 REVISION HISTORY Revision Description Effective Date 0 Initial issue of ISO 9001:2008 4/06/09

12 Management Review D. Graham 0 1 of 2 B. Hanesworth 4/06/ PURPOSE This section establishes the requirements for top management s review of the Quality Management System to ensure its continuing suitability, adequacy and effectiveness. 2.0 REFERENCE DOCUMENTS 2.1 ISO 9001:2008 Clause Quality Management System Manual Section 2, Planning 2.3 Quality Management System Manual Section 6, Documentation Requirements 2.4 Quality Management System Manual Section 15, Monitoring and Measurement 2.5 Quality Management System Manual Section 16, Control of Nonconforming Product 2.6 Quality Management System Manual Section 18, Improvement 3.0 DEFINITIONS 3.1 See Section 19, Glossary, for definitions. 4.0 QMSM REQUIREMENTS 4.1 Management Review - General Top management reviews Rheem Manufacturing Company's Quality Management System on an annual basis to ensure its continuing suitability, adequacy and effectiveness. This review includes assessing opportunities for improvement and the need for changes to the quality management system, including the quality policy and quality objectives. Records from these reviews are maintained per Reference 2.3 (see paragraph 6.0 below). 4.2 Review Inputs Inputs to the management review include information on: a) results of audits (Reference 2.4) b) customer feedback (Reference 2.4) c) process performance and product conformity to requirements (References 2.4 and 2.5) d) status of corrective and preventive actions (Reference 2.6) e) follow-up actions from previous management reviews (Reference 2.6) f) changes that could affect the QMS (Reference 2.2) g) recommendations for improvement (Reference 2.6) 4.3 Review Output The outputs from the review include all decisions and actions related to: a) improvement of the effectiveness of the Quality Management System and its processes b) improvement of product related to customer requirements, and c) resource needs

13 Management Review D. Graham 0 2 of 2 B. Hanesworth 4/06/ RESPONSIBILITIES The Management Representative is responsible for chairing the Quality Management System Review Meeting. Top management is responsible for reviewing the quality management system and to ensure its continuing suitability, adequacy and effectiveness. 6.0 RECORDS Records of the Management Review are maintained by the Quality Assurance Manager. 7.0 REVISION HISTORY Revision Description Effective Date 0 Initial issue of ISO 9001:2008 4/06/09

14 Documentation Requirements R. Werschky 0 1 of 4 D. Graham 4/06/ PURPOSE This section establishes the requirements for documentation of the Quality Management System (QMS). The system provides for the uniform preparation, revision, distribution, retrieval and storage of documents and records. 2.0 REFERENCE DOCUMENTS 2.1 ISO 9001:2008 Paragraphs 4.2.1, 4.2.2, and Quality Management System Manual Section 1, Quality Management System 2.3 Quality Management System Manual Section 2, Planning 2.4 QMSP 113, Document Control 2.5 QMSP 114, Quality Records 2.6 QMSP 602, Engineering Change Notice 3.0 DEFINITIONS 3.1 See Section 19, Glossary, for definitions. 4.0 QMSM REQUIREMENTS 4.1 Documentation Requirements - General The Rheem Manufacturing Company QMS documentation includes: a) documented statements of a quality policy and quality objectives, per Reference 2.2, b) Quality Management System Manual (QMSM); (see paragraph 4.2 below), c) documented Quality Management System Procedures (QMSP) referenced within each Section of this Manual and records where required by the ISO 9001:2008 Standard, d) documents needed by the Rheem Manufacturing Company organization to ensure the effective planning, operation and control of its processes, and e) records required by the ISO 9001:2008 Standard (see paragraph 4.4 below). 4.2 Quality Management System Manual The Quality Management System Manual provides an overall description of the scope of the Quality Management System, the general quality policies, quality objectives and documented procedures (referenced by this manual), and a description of the interaction between the processes of the Quality Management System (QMS). The Quality Management System Manual is subject to internal and external controlled distribution. For easy reference, the QMSPs are numbered so that there is a direct relationship between the organizational functions and their associated procedures.

15 Documentation Requirements R. Werschky 0 2 of 4 D. Graham 4/06/09 6 The Quality Management System Manual includes: a) the scope of the QMS (see paragraph 1 within each Section of this Manual), as it applies to Rheem Manufacturing Company. b) inclusion or reference to the documented procedures established for the QMS, and a description of the interactions between the processes of the QMS (see 4.5) 4.3 Control of Documents Documents required by the QMS are controlled as per reference 2.4. Records are a special type of document and are controlled in accordance with reference 2.5 above (see paragraph 4.4 below). The Quality Management System Procedures Referenced above establish the controls needed: a) for approval of documents for adequacy prior to issue, b) for review and update as necessary and re-approval of documents, c) for ensuring changes and the current revision status of documents are identified, d) for ensuring that relevant versions of applicable documents are available at points of use, e) for ensuring that documents remain legible and readily identifiable, f) for ensuring that documents of external origin determined by the organization to be necessary for the planning and operation of the Quality Management System are identified and their distribution controlled, and g) for preventing the unintended use of obsolete documents, and to apply suitable identification to them if they are retained for any purpose. A Master List has been established to identify the current revision of documents in order to control the issuance and revision status of the documents. The Engineering Change Notice shall be used to control each revision to existing drawings and specifications, reference Control of Records The QMSP reference 2.5 above has been established and is maintained to provide evidence of conformity to requirements and of the effective operation of the QMS. Records are maintained legible, readily identifiable and retrievable. Reference 2.5 defines the controls needed for the identification, storage, protection, retrieval, retention time and disposition of records.

16 Documentation Requirements R. Werschky 0 3 of 4 D. Graham 4/06/ Documentation Structure The diagram below outlines the structure of Rheem Manufacturing Company s QMS: Quality Management System Operations, Systems & Processes (QMSM) ) Quality Management System Manual Quality Management System Procedures (QMSP) Operator Instructions Inspection Instructions Level 1 Records Required By ISO 9001 and/or Organization The levels of documentation and instructions include: Level 2 Level 3 Level 4 Level 1 - Quality System Manual - A description of Rheem Manufacturing Company's method of establishing, implementing, and maintaining a quality QMS that meets the requirements of the ISO 9001:2008 standard. Level 2 - Quality System Procedures - Procedures which describe overall activities corresponding to the major sections of this manual. Level 3 - Operator/Inspection Instructions Work instructions that detail activities, such as how to operate a specific machine, how to inspect and assemble, or how to calibrate specific instrument and assembly instructions. Level 4 Records - Forms, tags, labels, stamps, routing cards, etc. 5.0 RESPONSIBILITIES The Manager of each department is responsible for ensuring that issues of appropriate documents in their area are available for use, pertinent and periodically reviewed for removal of all obsolete issues. Current Engineering Drawings and Specifications are maintained by R&D.

17 Documentation Requirements R. Werschky 0 4 of 4 D. Graham 4/06/ RECORDS As per QMSPs referenced above. Records are maintained for the length of time specified by the Corporate Retention Policy. 7.0 REVISION HISTORY Revision Description Effective Date 0 Initial issue of ISO 9001:2008 4/06/09

18 Resource Management D. Graham 0 1 of 2 R. Lolley 4/06/ PURPOSE This section establishes the requirements for management of the resources that are essential to the implementation and continual improvement of the QMS. 2.0 REFERENCE DOCUMENTS 2.1 ISO 9001:2008 Clause Quality Management System Manual Section 6, Documentation Requirements 2.3 QMSP 300, Human Resources and Training 2.4 QA-0386, Orientation Sheet 3.0 DEFINITIONS 3.1 See Section 19, Glossary, for definitions. 4.0 QMSM REQUIREMENTS 4.1 Provision of Resources - General Rheem Manufacturing Company identifies resource requirements and provides adequate resources needed to implement and maintain the QMS, to continually improve its effectiveness and to enhance customer satisfaction by meeting their requirements. When resource requirements change, management ensures that adequate resources are allocated. 4.2 Human Resources General All employees are verified to be competent in their specific job assignments on the basis of their education, training, skills, and experience. All employees hired prior to the implementation of this procedure are verified to be competent in their specific job assignments on the basis of their education, training, skills, and experience. All employees receive instruction in the QMS applicable to their specific work assignments. Personnel performing certain specialized activities identified and addressed in the QMS are formally qualified to perform those designated activities. 4.3 Competence, Training, and Awareness In order to ensure superior products, continual improvement and customer satisfaction, Rheem Manufacturing Company: a) determines the necessary competence for personnel performing work affecting conformity to product requirements, b) where applicable, provides training or takes other actions to satisfy these needs, c) evaluates the effectiveness of the actions taken, d) ensures that its personnel are aware of the relevance and importance of their activities and how they contribute to the achievement of the quality objectives, and e) maintains appropriate records of education, training, skills and experience, per Reference 2.2 (See paragraph 6.0 below).

19 Resource Management D. Graham 0 2 of 2 R. Lolley 4/06/09 7 The Human Resource Department screens all applications to ensure that all personnel are adequately qualified on the basis of appropriate skills assessment, education, training and/or experience required. As a part of the orientation process, all new employees receive the following instruction through Human Resources: a) Plant Safety - Preferably before starting work or within five days, each new employee receives instruction in plant safety procedures. b) Quality System Overview - Topics covered includes miscellaneous quality procedures and understanding the Quality Policy. c) Skills Instruction - To acquire the proficiency to perform tasks at the speed and quality level required. (QA-0386) 4.4 Infrastructure Rheem Manufacturing Company provides an adequate work environment and process equipment to design, fabricate, assemble and distribute heating, ventilation and air conditioning equipment for prospective dealers and distributors. Rheem Manufacturing Company also assists dealers and distributors with installation and training services. In support of these activities, Rheem Manufacturing Company determines, provides and maintains the infrastructure needed to ensure product conformity to the requirements. 4.5 Work Environment Rheem Manufacturing Company manages to achieve conformity to product requirements, provide a safe work environment conducive to accomplishing quality objectives. 5.0 RESPONSIBILITIES Top management is responsible for ensuring employee competence, awareness and training, and to establish the infrastructure and work environment needed to achieve conformity to product requirements. The Human Resource Department is responsible for documenting the training of employees as requirements are identified. Job descriptions may be utilized as guidelines for training requirements. 6.0 RECORDS The Human Resource Department maintains all records pertaining to training. 7.0 REVISION HISTORY Revision Description Effective Date 0 Initial issue of ISO 9001:2008 4/06/09

20 Product Realization D. Graham 0 1 of 2 A. Schuster 4/06/ PURPOSE This section establishes the requirements for planning and developing the processes needed for product realization. Planning for product realization is consistent with the requirements of all other sections of the Quality Management System Manual. Product realization is defined as that overall process that, as shown in Figure 1, begins with product development planning and ends with product delivery. 2.0 REFERENCE DOCUMENTS 2.1 ISO 9001:2008 Clause Quality Management System Manual Section 1, QMS General Requirements 2.3 Quality Management System Manual Section 2, Planning 2.4 Quality Management System Manual Section 6, Documentation Requirements 2.5 Quality Management System Manual Section 7, Resource Management 2.6 Quality Management System Manual Section 9, Customer-Related Processes 2.7 Quality Management System Manual Section 10, Design and Development 2.8 Quality Management System Manual Section 12, Production and Service Provision 2.9 Quality Management System Manual Section 13, Control of Monitoring and Measuring Equipment 2.10 Quality Management System Manual Section 15, Monitoring and Measurement 2.11 Product Development Process Manual 2.12 Critical Process Interaction Map for Rheem Manufacturing Company 3.0 DEFINITIONS 3.1 See Section 19, Glossary, for definitions. 4.0 QMSM REQUIREMENTS 4.1 Planning of Product Realization Rheem Manufacturing Company designs, fabricates, assembles and distributes heating, ventilation and air conditioning products for commercial and residential use. Those products are distributed through independent distributors and dealers. Therefore, product realization is a combination of processes as described in Figure 1. Planning for product realization is consistent with the requirements of the other processes of the QMS defined in Reference 2.2. In planning product realization, Rheem Manufacturing Company determines the following: a) quality objectives and requirements for the product, per References 2.3 and 2.6; b) the need to establish processes, documents, and provide resources specific to the product, per References 2.2, 2.4 and 2.5; c) required verification, validation, monitoring, measurement, inspection and test activities specific to the product and the criteria for product acceptance, per References 2.7, 2.8, 2.9 and 2.10; d) records needed to provide evidence that the realization processes and resulting product meet the requirements, per Reference 2.5. The output of this planning is in a form suitable for Rheem Manufacturing Company's method of operations.

21 Product Realization D. Graham 0 2 of 2 A. Schuster 4/06/ RESPONSIBILITIES The Division s senior (executive) staff is responsible for the overall product realization process. Each department manager is in turn responsible for the incremental processes within the product realization map (see Figure 1). Finally, respective Product Development Teams, as assigned by the senior staff and department managers, are responsible for specific product planning and realization. 6.0 RECORDS The Project Leader, who heads the Product Development Team and the respective core team members are responsible for the records needed to provide evidence that the product realization processes and resulting product meet requirements. 7.0 REVISION HISTORY Revision Description Effective Date 0 Initial issue of ISO 9001:2008 4/06/09

22 PRODUCT REALIZATION CRITICAL PROCESS INTERACTION MAP FOR RHEEM MANUFACTURING COMPANY CUSTOMER Distributor & Dealers PRODUCTION CONTROL SALES / MARKETING ENGINEERING / DESIGN / DEVELOPMENT TOP MANAGEMENT PLANT ENGINEERING CUSTOMER SERVICE PURCHASING HUMAN RESOURCES / TRAINING FABRICATION AND SUB- ASSEMBLY SUPPLIERS MANAGEMENT REPRESENTATIVE QUALITY ASSURANCE FINAL ASSEMBLY AND TEST WITHIN FOCUS FACTORY A/C HEATING PACKAGE FINISHED GOODS WAREHOUSE RAW MATERIAL WAREHOUSE QMSM Sec. 8 Attachment Rev. 00 Figure 1

23 Customer Related Processes D. Presley 01 1 of 2 (Contract Review) L. Shelby 9/02/ PURPOSE The purpose of this section is to determine, review and communicate the product requirements for customer related processes. 2.0 REFERENCE DOCUMENTS 2.1 ISO 9001:2008 Clause Quality Management System Manual Section 6, Documentation Requirements 2.3 QMSP 700, Contract Review 3.0 DEFINITIONS 3.1 See Section 19, Glossary, for definitions. 4.0 QMSM REQUIREMENTS Rheem Manufacturing Company has established procedures detailing the methods for reviewing proposals and contracts to ensure that Rheem has the capability to meet all customer specified requirements. 4.1 Determination of Requirements Related to the Product Rheem Manufacturing Company determines (through customer order and verification) the requirements specified by the customer, including the requirements for delivery and post-delivery activities. Requirements not stated by the customer but necessary for specified use or intended use, are reviewed and resolved prior to shipping. Any statutory and regulatory requirements applicable to the product are identified and considered. Additional requirements considered necessary are acted upon by Rheem Manufacturing Company. Contracts are reviewed, as a minimum, for pricing, quantities and ship-dates by the Customer Service Department before acceptance. Appropriate departments are consulted as necessary during the Contract Review. 4.2 Review of Requirements Related to the Product Rheem Manufacturing Company reviews the requirements related to its product. This review is conducted prior to Rheem Manufacturing Company's commitment to supply the product to the customer (e.g. submission of tenders, acceptance of contracts or orders, acceptance of changes to contracts or orders) and ensures that: UNCONTROLLED DOCUMENT a) product requirements are defined, b) contract or order requirements differing from those previously expressed are resolved, and c) the organization has the ability to meet the defined requirements. Records of the results of the review and actions arising from the review are maintained per Reference 2.2 (see paragraph 6.0 below). Where the customer provides no documented statement of requirement, the customer requirements are confirmed by Rheem Manufacturing Company before acceptance.

24 Customer Related Processes D. Presley 01 2 of 2 (Contract Review) L. Shelby 9/02/14 9 Where product requirements are changed, Rheem Manufacturing Company ensures that relevant documents are amended and that relevant personnel are made aware of the changed requirements. Any exceptions to the customer specifications shall be agreed upon with the customer prior to accepting an order or prior to finalizing a contract. 4.3 Customer Communication Rheem Manufacturing Company determines and implements effective methods (see reference 2.3) of communication with customers in relation to product information, inquiries, contracts or order handling, including contract changes, and customer feedback, including customer complaints. 5.0 RESPONSIBILITIES The Customer Service Department has the responsibility for determination and review of the requirements related to the product as well as customer communications. 6.0 RECORDS The results of Contract Reviews are documented and stored electronically by the Customer Service and Support Department in conjunction with the corporate retention policy. 7.0 REVISION HISTORY Revision Description Effective Date 0 Initial issue of ISO 9001:2008 4/06/ Removed: and Support 5.0 Removed: Sale Department and The National Center Order share Inserted: Customer Service Department has 9/02/14 UNCONTROLLED DOCUMENT

25 Design and Development D. Graham 0 1 of 3 A. Kessler 4/06/ PURPOSE This section establishes the requirements for the design and development of product related to heating, ventilation and air conditioning equipment. 2.0 REFERENCE DOCUMENTS 2.1 ISO 9001:2008 Clause Quality Management System Manual Section 6, Documentation Requirements 2.3 Quality Management System Manual Section 9, Customer-Related Processes 2.4 Product Development Process Manual 3.0 DEFINITIONS 3.1 See Section 19, Glossary, for definitions. 4.0 QMSM REQUIREMENTS 4.1 Design and Development Planning Rheem Manufacturing Company plans and controls the design and development of product. During the design and development planning, Rheem Manufacturing Company determines a) the design and development stages, b) the review, verification and validation that are appropriate to each design and development stage, and c) the responsibilities and authorities for design and development. d) Rheem Manufacturing Company manages the interfaces between different groups involved in design and development to ensure effective communication and clear assignment of responsibility. Planning output is updated, as appropriate, as the design and development progresses. 4.2 Design and Development Inputs Inputs relating to product requirements are determined and records maintained per References 2.2 and 2.3 (see paragraph 6.0 below). Inputs include a) functional and performance requirements, b) applicable statutory and regulatory requirements, c) where applicable, information derived from previous similar designs, and d) other requirements essential for design and development. The inputs are reviewed for adequacy to ensure that requirements are complete, unambiguous and not in conflict with each other.

26 Design and Development D. Graham 0 2 of 3 A. Kessler 4/06/ Design and Development Outputs The outputs of design and development are in a form suitable for verification against the design and development input and is approved prior to release. Design and development outputs a) meet the input requirements for design and development, b) provide appropriate information for purchasing, production and for service provision, c) contain or reference product acceptance criteria, and d) specify the characteristics of the product that are essential for its safe and proper use. 4.4 Design and Development Review At suitable stages, systematic reviews of design and development are performed in accordance with planned arrangements, per paragraph 4.1 above, a) to evaluate the ability of the results of design and development to fulfil requirements, and b) to identify any problems and propose necessary actions. Participants in such reviews include representatives of functions concerned with the design and development stage(s) being reviewed. Records of the results of the reviews and any necessary actions are maintained per Reference 2.2 (see paragraph 6.0 below). 4.5 Design and Development Verification Verification is performed in accordance with planned arrangements, per paragraph 4.1 above, to ensure that the design and development outputs have satisfied the design and development input requirements. Records of the results of the verification and any necessary actions are maintained per Reference 2.2 (see paragraph 6.0 below). 4.6 Design and Development Validation Design and development validation is performed in accordance with planned arrangements, per paragraph 4.1 above, to ensure that the resulting product is capable of meeting the requirements for the specified application or intended use, where known. Wherever practicable, validation is completed prior to the delivery or implementation of the product. Records of the results of validation and any necessary actions are maintained per Reference 2.2 (see paragraph 6.0 below). 4.7 Control of Design and Development Changes Design and development changes are identified and records maintained. The changes are reviewed, verified and validated, as appropriate, and approved before implementation. The review of design and development changes include evaluation of the effect of the changes on constituent parts and product already delivered. Records of the results of the review of changes and any necessary actions are maintained per Reference 2.2 (see paragraph 6.0 below).

27 Design and Development D. Graham 0 3 of 3 A. Kessler 4/06/ RESPONSIBILITIES R & D has the responsibility for effective planning, design inputs, design outputs and review, verification and validation and changes associated with design and development of Rheem products. 6.0 RECORDS Records associated with product design are the responsibility of the R & D department. 7.0 REVISION HISTORY Revision Description Effective Date 0 Initial issue of ISO 9001:2008 4/06/09

28 Purchasing D. Presley 02 1 of 2 A. Green 10/3/ PURPOSE This section establishes the requirements for ensuring that purchased materials and subcontracted services conform to the specified purchasing requirements. 2.0 REFERENCE DOCUMENTS 2.1 Rheem Manufacturing Company Supplier Quality Manual 2.2 Quality Management System Manual Section 6, Documentation Requirements 3.0 DEFINITIONS 3.1 See Section 19, Glossary, for definitions. 4.0 QMSM REQUIREMENTS 4.1 Purchasing Process Rheem Manufacturing Company ensures that purchased product conforms to specified purchase requirements. The type and extent of control applied to the supplier and the purchased product is dependent upon the effect of the purchased product on subsequent product realization or the final product. Rheem Manufacturing Company evaluates and selects suppliers based on their ability to supply product in accordance with Rheem Manufacturing Company's requirements. Approved suppliers are identified in the electronic system (such as Reliance). Criteria for selection, evaluation and re-evaluation is established. Records of the results of evaluations and any necessary actions arising from the evaluation are maintained per Reference 2.2 (see paragraph 6.0 below). Details of these activities are documented in Reference 2.1, section I, listed above. 4.2 Purchasing Information Purchasing information describes the product to be purchased including, where appropriate, a) requirements for approval of product, procedures, processes and equipment, b) requirements for qualification of personnel, and c) quality management system requirements. d) description of product or service including drawings, specifications, and test requirements. e) identification and marking specifications to comply with safety certification agency requirements. f) requirements for shipping and packaging.

29 Purchasing D. Presley 02 2 of 2 A. Green 10/3/16 11 Rheem Manufacturing Company ensures the adequacy of specified purchase requirements prior to their communication to the supplier. Details of these activities are documented in Reference 2.1, section II, listed above. 4.3 Verification of Purchased Product Rheem Manufacturing Company establishes and implements the inspection or other activities necessary for ensuring that purchased product meets specified purchase requirements, including but not limited to Production Part Approval Process (PPAP), Supplier Assessment and Receiving Inspection activities. Where the organization or its customer intends to perform verification at the supplier s premises, Rheem Manufacturing Company states the intended verification arrangements and method of product release in the purchasing information. Details of these activities are documented in Reference 2.1, section I & III, listed above. 5.0 RESPONSIBILITIES Purchasing documents will be reviewed for adequacy of specified requirements by the purchasing department representative prior to release. Suppliers of safety-related material shall be approved by the Engineering Department. Quality Assurance Department is responsible to conduct Receiving Inspections, Supplier Assessments and required PPAP sample inspections. 6.0 RECORDS Purchasing records shall be maintained in accordance with Reference REVISION HISTORY Revision Description Effective Date 0 Initial issue of ISO 9001:2008 4/06/ Deleted: All incoming raw material and piece parts are assigned a lot or batch 4/20/09 number and logged into the receiving inspection log. All inspected lots that are accepted are identified. The person performing the inspection stamps or otherwise identifies their acceptance as detailed in the applicable Quality Management System Procedure (QMSP) Revised list of reference documents deleted all but 2.2 Changed 2.1 to Rheem Manufacturing Company Supplier Quality Manual 4.1,4.2, 4.3 Added note for Reference Changed to PPAP inspection (from FAI) 10/3/16

30 Production and Service Provision D. Graham 0 1 of 4 B. Hanesworth 4/06/ PURPOSE This section establishes the requirements for the design, production, and service provisions related to the manufacture of gas and electric heating and air conditioning equipment for commercial and residential use. 2.0 REFERENCE DOCUMENTS 2.1 ISO 9001:2008 Clause Quality Management System Manual Section 6, Documentation Requirements 2.3 Quality Management System Manual Section 7, Resource Management 2.4 Quality Management System Manual Section 9, Customer-Related Processes 2.5 Quality Management System Manual Section 13, Control of Monitoring and Measuring Equipment 2.6 Quality Management System Manual Section 15, Monitoring and Measurement 2.7 QMSP 101, In-Process Inspection 2.8 QMSP 107, First Part Approval 2.9 QMSP 108, First Article Inspection 2.10 QMSP 109, Scrap Procedure 2.11 QMSP 110, Data Acquisition Network 2.12 QMSP 111, Supplier Assessment 2.13 QMSP 112, Finished Goods Re-Inspection 2.14 QMSP 115, Final Inspection and Testing 2.15 QMSP 116, Receiving Inspection 2.16 QMSP 202, Total Productive Manufacturing 2.17 QMSP 204, Process Control 2.18 QMSP 400, Handling, Storage, Packaging, Preservation and Delivery 2.19 QMSP 401, Product Identification and Traceability 2.20 QMSP 603, In-Process and Final Test 2.21 QMSP 701, Customer Reporting Systems 3.0 DEFINITIONS 3.1 See Section 19, Glossary, for definitions. 4.0 QMSM REQUIREMENTS 4.1 Control of Production and Service Provision Rheem Manufacturing Company plans and carries out production and service provision under controlled conditions. Controlled conditions include: a) the availability of information that describes the characteristics of the product, per Reference 2.4, b) the availability of work instructions, as necessary, per Reference 2.2, c) the use of suitable equipment, per Reference 2.3, Equipment approval will be performed per QSP 107. d) the availability and use of monitoring and measuring devices, per Reference 2.5, e) the implementation of monitoring and measurement, per Reference 2.6, and f) the implementation of release, delivery and post-delivery activities, per References 2.4 and 2.6. Quality Assurance, Manufacturing Engineering, and/or Production communicate work instructions to required operation. In addition to work instructions, illustrations and samples may also be provided to show workmanship criteria.

31 Production and Service Provision D. Graham 0 2 of 4 B. Hanesworth 4/06/ Validation of Processes for Production and Service Provision Rheem Manufacturing Company validates any processes for production and service provision where subsequent monitoring or measurement cannot verify the resulting output. This includes any processes where deficiencies become apparent only after the product is in use or the service has been delivered. Validation demonstrates the ability of these processes to achieve planned results. Rheem Manufacturing Company establishes arrangements for these processes including: a) defined criteria for review and approval of the processes, b) approval of equipment and qualification of personnel, c) use of specific methods and procedures, d) requirements for records, per Reference 2.2, and e) revalidation. Processes are periodically reviewed by the Manufacturing Engineering Department through Maintenance Records, Statistical Charting, and First Part Inspections. In-process functional tests are uniquely identified by the individual performing the tests. Test results are documented in accordance with control plans or inspection instructions. Final inspection includes verification that appropriate in-process inspections and tests are performed. No product is to be sent to stock without an acceptance stamp affixed. Final inspection is performed as described in control plans and/or inspection instructions to ensure that all customer-specified requirements are satisfied. Inspection and test results are documented in the form of inspection and test reports. Final inspection and test results are also recorded. Any product found to be nonconforming is handled as described in Section 16 of this manual. 4.3 Identification and Traceability Rheem Manufacturing Company identifies the product by suitable means throughout product realization. This includes identification of product status with respect to monitoring and measurement requirements throughout product realization. Rheem Manufacturing Company controls the unique identification of the product and maintains records, per Reference 2.2 (See paragraph 6.0 below). The supplier uniquely identifies incoming components corresponding to the required traceability listing. Additional information is recorded as per QMSP 116 for all incoming materials. Records used to identify lots, their origins, drawing numbers, specifications, and acceptance criteria are maintained. When traceability is required on critical components, unique serial numbers are allocated to each part. The Purchasing Department communicates the serial number requirements to the supplier. When a supplier maintains a procedure or system for serializing parts or assemblies, that supplier's system may be used to provide traceability. Finished products manufactured by Rheem Manufacturing Company are identified by a model number and serial number permanently marked on the product. Finished products are identified by a date code indicating

32 Production and Service Provision D. Graham 0 3 of 4 B. Hanesworth 4/06/09 12 the year and week of production. All such serial numbers are recorded as a part of inspection and test documentation. Where date coding on the product is not feasible, or is omitted by customer request, documentation is provided with the product in the form of a shipping notice and on the shipping container. A record of such shipments shall be maintained on the final inspection report. 4.4 Customer Property Rheem Manufacturing Company shall exercise care with customer property while it is under our control or being used by Rheem Manufacturing. Rheem Manufacturing shall identify, verify, protect, and safeguard customer property provided for use or incorporation into the product. If any customer property is lost, damaged, or otherwise found to be unsuitable for use, this shall be reported to the customer and records maintained. 4.5 Preservation of Product Rheem Manufacturing Company preserves the product during internal processing and delivery to the intended destination in order to maintain conformity. This preservation includes identification, handling, packaging, storage and protection of all tangible aspects of our product. Preservation also applies to the constituent parts of the product. Handling, storage, packaging, preservation, and delivery is carried out in accordance with QMSP 400 to insure that incoming parts, in-process sub-assemblies, and finished assemblies are protected from damage. Work instructions specify proper handling practices. Appropriate methods for authorizing receipt and the dispatch to/from storage areas is stipulated. The condition of product is assessed at appropriate intervals. Packaging and labeling processes are controlled to meet requirements. Appropriate segregation of product is applied. 5.0 RESPONSIBILITIES Plant Management is responsible for validation of processes for production and service provision, identification and traceability and preservation of product. Servicing of the products after installation is the responsibility of the National Service Department. The Quality Assurance Department is responsible for development of control plans with input from R&D, Engineering, Manufacturing, and other departments as required. The Shipping Department is responsible for delivery of products to the customer and for choosing a carrier to ensure that the Product reaches the customer in good condition.