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To improve the FMEA development process and make it easier for automotive manufacturing suppliers to meet the needs of their customers during the Failure Mode and Effects Analysis (FMEA) development process, AIAG and VDA have harmonized their previous “regional” FMEA manuals into a single, co-copyrighted handbook. This handbook uses best practices from each manual, and a process-oriented approach to meet the requirements of both industry groups.
The AIAG & VDA FMEA Handbook replaces the previous version (AIAG FMEA Manual 4th Edition). Organizations within the automotive supply chain are questioning the significance of the changes and how they will impact their organization. The truth is, when correctly implemented, some of the changes will impact your organization both in terms of performance, and ultimately, your organization’s bottom line.
The following report highlights some of most important improvements you can expect to see in the AIAG & VDA FMEA Handbook and explains the benefit of these changes in terms of FMEA robustness, performance, effectiveness and efficiency. But before diving into these improvements and comprehending their impact, it’s important that you know how to determine if your FMEA development process is performing as it should through the linkage between FMEA and the Cost of Quality (COQ) which indicates the financial impact FMEA inevitably has on business performance.
Failure Mode and Effects Analysis (FMEA) is a team-oriented, systematic, qualitative, and analytical method intended to identify, analyse, and mitigate technical risks related to product and manufacturing process design. It supports the five Advanced Product Quality Planning (APQP) phases to improve customer satisfaction by emphasising defect prevention.
When used correctly, a major benefit of the FMEA is being able to mitigate risk while balancing costs leading to organizational stability and growth. To achieve this, you should be able to connect the FMEA to the Cost of Quality (COQ).
The FMEA development process is a deep-dive analysis of the potential for both internal and external failures. As such, the quality of the FMEA affects an organization’s success in keeping its Cost of the Poor Quality (COPQ) low. While COPQ seeks to translate the concept of quality failures into terms of time and money, the FMEA is a tool in identifying the source of the failures that contribute to COPQ, allowing an organization to take the right preventive actions.
So how do you determine if your FMEA development process is performing as it should? Improvement of overall business performance can be a good indication, especially in terms of lower Cost of Poor Quality (COPQ).
Traditionally, there are four categories within the Cost of Quality (COQ), and two of these are categorized under Cost of Poor Quality (COPQ):
External Failure Costs
External failure costs are the result of failures that exist outside of the organization, such as failing to meet a requirement. This area of cost can also be categorized under COPQ. Some examples of costs associated with external failures are as follows:
Internal Failure Costs
Internal failure costs are the result of failures that exist inside of the organization. This is another area of cost categorized under COPQ. Some examples of internal failure costs are as follows:
Appraisal costs
Appraisal costs include testing and monitoring of items, or activities. Some examples of appraisal costs are as follows:
Prevention costs
Prevention costs include any activities that prevent failures. Some examples of prevention activities are as follows:
FMEA Effectiveness
The ability to provide information that indicates FMEA performance is critical to obtain management commitment in the FMEA development process. If the main purpose of FMEA is to mitigate technical risks to an acceptable level, we can then affirm that the organizational effort to develop the FMEA will only be valid if incidents of internal and external failures remain within the acceptable limits after the new product or process launch. Consider a simple analogy comparing the effort made to prepare FMEAs with a student who studies hard but still receives poor scores; at the end of the day, poor scores indicate that the studying was not effective. The same goes for FMEA development. We can evaluate FMEA effectiveness by monitoring the reduction of internal and external failures. If there isn’t an acceptable reduction in failures, the FMEA was not effective.
FMEA Efficiency
In addition to the effectiveness of your FMEA, it’s important that you also consider its efficiency. For managers, another critical aspect of FMEA performance is the level of effort required to prepare effective FMEAs. In order to balance cost, you should consider the resources allocated to prepare FMEAs. For example:
The level of effort required to prepare an effective FMEA relates to the cost of appraisal and prevention, as previously described. Overall COQ is used to show the balance between prevention/appraisal costs and the reduction of internal and external failure costs.
Evaluating FMEA performance of new product and process development can be accomplished by monitoring the COQ of similar products and process. Current COQ will be the baseline of the new generation of products and processes and the critical question to answer is “Do we expect the same levels of COQ / COPQ in this new product and/or process development?” The answer most likely is, “No, we want lower COPQ.” But even if the answer is “yes” the game is not over. The multidisciplinary team will need to consider if the new product or process has new functions and requirements that will lead to new failure modes or causes, therefore, an evaluation of how robust the current prevention and detection controls are to ensure that quality performance targets are achieved.
This is the essential link between COQ / COPQ and FMEAs:
The AIAG & VDA FMEA Handbook is strongly rooted with the purpose of increasing FMEA robustness. In the next section we present some of the major improvements, benefits, and changes in the AIAG & VDA FMEA Handbook that will bring your organization to the next level of business performance in the automotive supply chain.
The FMEA manual has been revised with the sustainability of the automotive supply chain in mind. The purpose of the development of the new AIAG & VDA FMEA Handbook is to apply a more robust methodology to address product and manufacturing process risks, while considering the complexities of multiple OEM-specific and regulatory requirements, and demanding consumers expectations for better and more innovative products. AIAG and VDA FMEA manuals have been harmonized in a joint publication to take these factors into account.
This new FMEA method is described in a single co-copyrighted handbook that takes the best practices from AIAG and VDA using a process-oriented approach to develop Design and Process FMEAs that meet requirements for both industry groups. Therefore, the application of the AIAG & VDA FMEA Handbook will enable suppliers to effectively address technical risks during the Product and Process Development process by developing a robust, accurate, and complete DFMEA and PFMEA that will meet the needs of all customers.
The new AIAG & VDA FMEA Handbook presents the following benefits:
Below we’ve described three important changes to demonstrate these benefits.
The most noticeable change in the AIAG & VDA FMEA Handbook is its new approach for FMEA development: the 7-step Approach. It provides a framework for documentation of technical risks in a precise, relevant, and complete manner. This new framework is precise because of its use of technical terms to describe failure modes and its potential causes. It is relevant because the failure effects describe technical consequences of failures. Lastly, it is complete because of its use of focus element-upper level-lower level approach enabling a comprehensive review of the risks.
The 7-step Approach is more structured, and highly instrumental in increasing a multidisciplinary team’s effectiveness and efficiency:
Another major difference is the enhanced direction of FMEA Planning and Preparation; the 1st step of FMEA development. While defining the scope has always been part of the FMEA development, the AIAG & VDA FMEA Handbook gives it increased prominence. For example, determining analysis boundaries (what is included and what is excluded), application of 5T’s (FMEA InTent, Timing, Team, Tasks, Tools), preparation of baseline FMEAs with lessons learned, and clear definition of roles and responsibilities (management, technical lead, facilitator, team members) are now more explicitly included in FMEA preparation.
Enhanced planning and preparation will allow you to avoid wasting time of the multidisciplinary team due to lack of focus (Why are we here? What is the technical risk in discussion now? Who should do what?) and relevant information availability.
The benefits of organizing lessons learned into baseline FMEAs are:
The new AIAG & VDA FMEA Handbook includes more specificity in the criteria to determine levels for Severity, Occurrence, and Detection ratings. For example, consideration of confirmation of effectiveness of current prevention and detection controls, product and process experience, and detection method maturity are now included in the criteria.
In addition, Action Priority (AP) replaces RPN’s (Risk Priority Numbers). Examination of S, O, and D ratings individually and in combinations of the three factors for risk-reducing actions prioritized as High, Medium or Low. A High priority is a request for risk mitigation actions to improve prevention / detection controls or justification why current controls are adequate.
AP levels based on combination of S, O, and D ratings clearly favors error-proofing. AP is considered High or Medium for severity and occurrence moderate ranks, even when detection controls are effective.
New FMEA is actionable. Implementing error-proofing solutions is the fastest path to downgrade AP levels from High to Medium and Medium to Low.
In addition to the major changes explained above, here are other changes you can expect to see:
If you’re currently using the AIAG FMEA 4th Edition or have yet to properly implement the FMEA development process within your organization, there are important steps to follow once the new AIAG & VDA FMEA Handbook is released. Keep in mind that every organization is different, so the steps needed to adjust your FMEA development process are likely to be unique to your situation. However, here are some steps that will help you get started on the journey:
AIAG’s training courses for the new AIAG-VDA FMEA Handbook are provided by LMR in partnership with Plexus International, a certified global provider for AIAG quality products and services.
LMR Global courses can be tailored to your requirements and delivered ‘in-house’ at your premises or in one of our well equipped training venues. For more details please click on the course you are interested above.