A failure modes and effects analysis (FMEA) is a procedure in product development, root cause analysis and operations management for analysis of potential failure modes within a system. It recognizes that the risk generated by a failure mode is dependent on the product of three factors:
- the severity of the effect on the customer or process,
- the likelihood of that failure mode occurring, and
- the likelihood that the current system can detect the failure mode before impacting the system as a whole.
Each of the three factors is rated from 1 to 10, and the product of the three – the "risk priority number" – provides insight into the relative risk of each failure mode. Though most FMEA explanations suggest you use "standard" sheets to rank the three factors that contribute to the total risk, we have found that creating sheets that better express the issue at hand not only make the process more comprehensable to the participants, but give a more accurate prioritization of the risks.
FMEAs should always be done by a team with broad knowledge of the issue. To avoid the typical drudgery of participants arguing over the score of each factor, we have developed and use a method that allows everyone input electronically. The facilitator then releases all the scores to the participants, who can ask the reason behind a score that may appear to be an outlier. Outliers are often due to someone with critical additional knowledge that would otherwise be dismissed.