FMEA as a tool for identifying possible failures in Acquisition / New Start Up

D

Diana Cadwalader

#1
Was wondering if anyone has consistently used FMEA as a tool for identifying possible failures or pitfalls in Acquisitions or New Facility Startups.

I have been pushing people to use FMEAs actively as planning tools in our organization by amending the rankings slightly to fit the situations. For instance, we recently brought a new line on in one of our facilities. In order to bring the line up, we had to shut everything down and re-install the software to include the buffers. We did this on a weekend to avoid interrupting shipments to customers. Prior to the project, we did a FMEA to brainstorm potential failures, (ie can not get software to reinstall) and from that put some contingency plans in place for our top RPNs. We often do these kind of FMEA activities when we undertake a new project. We also use the Rankings to kind of score ourselves and our success in the project. We may start with a risk factor of 1000 and end up reducing the risk factor to 200 by taking actions as a result of the FMEA.

Now I am looking to use this tool for new facility startups and for acquisition activities. I was kinda hoping that someone had already traveled this road and had some suggestions for failure modes and ranking criteria.

Thanks in advance for any and all advice - -
 
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Wes Bucey

Quite Involved in Discussions
#2
I think it's an excellent idea to use the Failure Mode and Effects Analysis (FMEA) techniques in the planning for any activity.

In many industries, even including security and insurance industries, best practices include due diligence and risk analysis before entering new businesses or modifying existing ones. (A rose by any other name . . .)

It so happens Quality wonks (like us in the Cove) call our risk analysis FMEA and the inclusion of the word "failure" has spooked a lot of folks. The other thing that many folks have difficulty assimilating is how to estimate the probability of a failure event occurring versus the impact such failure will have on the product, service, or organization as a whole. Finally, the question is how likely the failure will be undetected prior to shipment or installation.

I'd be willing to bet many of us have stories we can at least smile at now which were devastating when the failure event really happened. One of mine goes back to the 1960's when a client pulled out an entire bank of heat treating ovens to make room for new ones. None of the new ovens achieved sufficient BTU output to treat their material (no one had thought to test one oven first! No one thought to alert customers there might be a brief hitch in deliveries and give them a chance to stock up before the changeover.) The impact was that nearly 100 customers had their production lines shut down or severely impacted for 3 months until a second batch of new ovens were tested and installed and deliveries of the proprietary product resumed. The bosses had planned for only one contingency - they waited until the new ovens were on a fleet of trucks lined up down their street before they pulled out the old ovens and sent them to scrap. The new ovens simply did not perform to design specification.
 
#3
I agree with Wes: FMEA is a very good planning tool, and I can se no reason not to use it in connection with an aquisition. One interesting point is that if it concerns company that has mapped its processes (ISO9001:2000, clause 4.1 comes to mind biggrin-a1.gif ), a good part of the job is done already. This data should form a good basis for an FMEA.
Wes Bucey said:
It so happens Quality wonks (like us in the Cove) call our risk analysis FMEA and the inclusion of the word "failure" has spooked a lot of folks.
Yes, you are right... So let's call it somethng else. Hmmmm. Lots of things we shouldn't say when talking to non quality geeks. We can't even say Quality management System anymore. Oops! did I say that?

Life gets so complicated these days... rolleyes-a1.gif

/Claes
 
D

Diana Cadwalader

#4
Very good point about the process maps and the utilization of those. We have been doing it by associating failures with Scorecard Objectives as well (ie safety, quality, productivity)......

Unfortunately, most of the companies acquired are not already registered to the new standard so are lacking in these areas so it is often that we are starting from scratch.
 
C

chalapathi

#5
Diana Cadwalader said:
Was wondering if anyone has consistently used FMEA as a tool for identifying possible failures or pitfalls in Acquisitions or New Facility Startups.

I have been pushing people to use FMEAs actively as planning tools in our organization by amending the rankings slightly to fit the situations. For instance, we recently brought a new line on in one of our facilities. In order to bring the line up, we had to shut everything down and re-install the software to include the buffers. We did this on a weekend to avoid interrupting shipments to customers. Prior to the project, we did a FMEA to brainstorm potential failures, (ie can not get software to reinstall) and from that put some contingency plans in place for our top RPNs. We often do these kind of FMEA activities when we undertake a new project. We also use the Rankings to kind of score ourselves and our success in the project. We may start with a risk factor of 1000 and end up reducing the risk factor to 200 by taking actions as a result of the FMEA.

Now I am looking to use this tool for new facility startups and for acquisition activities. I was kinda hoping that someone had already traveled this road and had some suggestions for failure modes and ranking criteria.

Thanks in advance for any and all advice - -
I have used in setting a new factory (complete project management) and introducing a new appraisal system in a company. It is very useful, we can actually avoid many failures.
 
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