Failure Mode and Effects Analysis (FMEA) Explained

What is FMEA in Lean?

The acronym FMEA, or Failure Mode and Effects Analysis, is a systematic, proactive approach used in Lean and Six Sigma to identify potential failures before they occur, understand their possible effects, and prioritize the risks so that businesses can take action to prevent or mitigate them.

To give further context to this, think of FMEA as asking three big questions:

1. What could go wrong? This is Failure Mode

2. What would happen if it went wrong? This is the Effect of the failure  

3. Why might it go wrong? This is the circumstance or circumstances that gave Cause to the failure.

Mindful of the foregoing and taking this a step further, FMEA would be incomplete without an Assessment of potential by looking at:-

• Severity (How bad the failure would be)

• Occurrence (How often it could possibly occur)

• Detection (How likely it would be to catch it before it impacts the customer)

By assigning scores to each of these factors (severity, occurrence, and detection), a Risk Priority Number (RPN) or profile can be established to inform decisions and prioritize areas for improvement.

A Relatable Example

Let’s look at this in a practical example...

• Imagine you own a coffee shop and the coffee machine breaks down during the morning rush. This immediately activates and pushes the business into a Potential Failure Mode. Naturally, customers will be unable to get coffee, or the wait times may be longer than usual, resulting in upset customers, lost sales, and possible reputational damage. This represents the Effect on the business. An Analysis may point to a lack of preventive maintenance, giving cause or reason for the failure.

By scoring severity as high, because customers are affected, occurrence as moderate, as the machine breaks every few weeks, and detection as low, as the machine is not typically checked until it fails, it immediately becomes apparent that this is a high-risk issue.

The improvement Action of scheduling regular maintenance and the decision to invest in a backup brewer immediately positions the business to both anticipate and eliminate failure before it hurts the business.

Why FMEA Matters in Business

Lean leaders don’t wait for fires to start; they remove the sparks before the flame. Notably as well, strong businesses aren’t built by reacting to failure, but by designing failure out of the process before it ever reaches the customer. FMEA is important in this regard for the following reasons:

• It prevents costly mistakes - Catching potential failures early is always cheaper than fixing them later.

• It improves customer trust - By proactively safeguarding quality and reliability, customers experience fewer issues and become brand champions.

• Focuses resources wisely - Not every failure is equally critical. The Risk Priority Number alluded to above validates this. In this regard, FMEA plays a key role in prioritizing what truly matters and guiding the best use of resources.

• Drives continuous improvement – In effect, it encourages a culture of “forecasting or looking ahead, preventing, and improving” instead of firefighting.

In Lean, FMEA is more than just a technical tool; it’s a preventive management mindset. It shifts businesses from reacting after a failure to designing processes that make failure unlikely in the first place.

FMEA teaches us that business excellence is not achieved by fixing failures after they happen, but by anticipating them, understanding their impact, and designing processes that make failure nearly impossible. It is the discipline of prevention over correction, and foresight over hindsight.