FMEA Risk Analysis - Lean Six Sigma Risk Management Tool

Why the FMEA is a Great Tool for All Project Managers


The Failure Mode and Effect Analysis (FMEA) is a powerful tool for managing risk. Originating from the aerospace industry during the 1960s, it has since become a cornerstone in industries ranging from manufacturing to healthcare. The FMEA tool enables organisations to identify potential failures in a system, product, or process before they occur. By proactively assessing the potential consequences and severity of these failures, mitigation strategies can be developed to reduce risk and improve overall operation efficiency.



Failure Mode and Effects Analysis (FMEA) is a systematic, step-by-step approach for identifying all possible failures in a design, a manufacturing or assembly process, or a product or service. It’s designed to define, identify, and eliminate known and potential failures, problems, errors, and so on from the system, design, process, or service before they reach the customer. 

The FMEA tool helps project managers and teams to anticipate and mitigate the risk of potential failures, prioritising them based on their severity, occurrence, and detection, which in turn facilitates the development of actions to eliminate or reduce risks. FMEA is a proactive tool used to foresee problems and take corrective action to prevent their occurrence, making it an invaluable methodology for ensuring project success and customer satisfaction.

FMEA Risk Analysis Example 3

Importance of Risk Management in Project Management


The significance of risk management within project management cannot be overstated. It is the backbone of any successful project business process, ensuring that potential issues are identified, assessed, and mitigated before they impact the project’s outcome. Risk management enables project managers to make informed decisions, allocate resources efficiently, and control the project’s trajectory. By proactively managing risks, project teams can avoid costly setbacks, reduce occurrence, maintain project timelines, and safeguard the project budget. In essence, effective risk management is critical for achieving project objectives and ensuring stakeholder satisfaction, highlighting its indispensable role in project management.

FMEA is an invaluable tool for project managers to identify and mitigate risks early in the project lifecycle.

Understanding FMEA


Definition of FMEA

Failure Mode and Effects Analysis (FMEA) is an analytical technique project managers and teams use to identify and evaluate potential failures within a product, process, design, or system. The essence of FMEA lies in its structured approach to detect, prioritise, and mitigate risks by assessing the likelihood of failures, understanding their potential consequences, and identifying the means of their occurrence. This method enables teams to anticipate possible points of failure and implement strategies to prevent them from occurring, guaranteeing improved reliability and safety of the project outcome. Through FMEA, organizations can significantly enhance the quality of their products design solutions, or services, thereby increasing customer satisfaction and competitive advantage.

Historical Background and Evolution of the FMEA Process

The Failure Mode and Effects Analysis (FMEA) process has its roots in the 1940s when the U.S. military initially developed a manufacturing process. The method was formalised and introduced in the 1949 Military Procedure MIL-P-1629 titled “Procedures for Performing a Failure Mode, Effects and Criticality Analysis”. Its primary aim was to identify and address potential failures in military systems during the design phase to prevent their occurrence in active service. Over the years, the methodology evolved and expanded beyond its military origins.

In the 1960s, the aerospace and automotive industries began adopting FMEA, recognising its potential to improve product reliability and safety vastly. The automotive industry further refined and popularised the approach, especially by Ford Motor Company in the 1970s, which applied it to its safety, reliability engineering and environmental protection processes. This led to developing industry-specific FMEA standards, including those published by the Society of Automotive Engineers (SAE) and the American Society for Quality (ASQ).

The methodology has since been adopted globally across various sectors of manufacturing industries, including healthcare, finance, and information technology, evolving into a versatile tool for risk management. Today, FMEA is an integral part of the ISO 9001 quality management system, and the production process has been tailored to meet the specific needs of different industries, demonstrating its flexibility and universal applicability. Through its continuous evolution, FMEA has proven to be a fundamental process for any organisation aiming to proactively identify and mitigate risks, thus ensuring the quality, reliability, and safety of their products or services.

Key Components of FMEA


The Failure Mode and Effects Analysis (FMEA) process is built around three critical components: Failure Modes, the modes and Effects Analysis,, and Criticality Analysis. Each element of sub system plays a vital role in comprehensively evaluating and mitigating risks.

Failure Modes

Failure Modes refer to the various ways a process, design, product, or service could fail to meet the required standards or expectations. Identifying these failure modes is the first step in understanding the vulnerabilities within the system. This involves a detailed analysis of all the possible points of the process failure modes, categorising them based on their impact on the process controls overall system’s performance.

Effects Analysis

Once the potential failure modes are identified, the next step is to conduct an Effects Analysis. This aspect of the FMEA analysis focuses on assessing the consequences of each identified failure mode. This analysis aims to understand potential failures’ impact on the end-user, including any safety, financial, operational, and reputational damages. It helps in prioritising which failure modes require immediate attention based on the severity of the failure mechanism and their effects.

Criticality Analysis

Criticality Analysis evaluates the significance of each failure mode and effect, taking into account its likelihood of occurrence and detectability. This component of FMEA facilitates the prioritisation of risks, allowing teams to allocate resources more effectively to address the most critical issues first. It combines hazard analysis with an understanding of both the potential impact of failure modes and their probability of occurring to determine the overall level of risk each one and failure effect presents.

These key components of FMEA work in synergy to provide a structured approach for identifying, assessing, and mitigating risks, ensuring that projects can progress more smoothly with a reduced likelihood of failure occurring because of unexpected complications.

FMEA Risk Analysis Example

The Benefits of FMEA for Project Management

Proactive risk identification is at the heart of FMEA’s utility in project management. By systematically anticipating potential failures at every stage of product development or project execution, FMEA provides a clear framework for identifying vulnerabilities before they manifest into costly errors. This foresight isn’t just about preventing material defects or service inadequacies; it’s about understanding the cascade of consequences that each failure mode could precipitate. From the outset, FMEA pushes teams to think ahead about possible points of failure, whether in design, manufacturing, service delivery, customer feedback or any other critical phase of the project lifecycle. 

This process not only helps in averting potential crises but also steers the project towards more innovative and reliable solutions, ensuring a smoother path to achieving project goals with fewer chances of unforeseen setbacks. Through proactive risk identification, FMEA empowers project teams to build resilience in their projects, fortifying them against uncertainties and enhancing overall project performance.

  • Prioritisation of Risks: In the context of FMEA, Risk Prioritisation is an essential step that hinges on evaluating risks based on three pivotal criteria: severity, occurrence, and detectability. By categorising risks with these dimensions in mind, FMEA enables project teams to discern which potential failures demand immediate attention and resource allocation.
  • Severity assesses the impact of a failure mode on the end-user, considering the extent of harm or inconvenience it might cause. This dimension prompts teams to consider the worst-case scenarios of each failure, guiding them to prioritise issues that could severely affect customer satisfaction or safety.
  • Occurrence estimates the likelihood of a failure mode happening. This evaluation is crucial in understanding how often a potential issue might arise, allowing teams to focus on preventing the most frequent problems that could disrupt the project’s flow.
  • Detectability looks at the probability of identifying a failure before it reaches the end-user. Higher detectability rates suggest that a failure mode can be caught and rectified early in the development process, reducing its risk profile.

By applying these criteria, FMEA aids in creating a Risk Priority Number (RPN) for each identified risk level failure mode, providing a quantifiable measure to guide the prioritisation process. This structured approach to categorising risks and failure mechanisms not only ensures that resources are efficiently used to mitigate the most critical issues but also helps develop a more robust and reliable project outcome.

The Benefits of FMEA within Project Management

  • Enhancing Communication and Team Collaboration: FMEA inherently promotes a culture of open communication and teamwork among project participants. Requiring cross-functional collaboration early on ensures that knowledge and perspectives from various departments are shared and considered. This collective effort is crucial in identifying potential failure modes accurately and evaluating their impacts comprehensively. Regular FMEA meetings serve as a platform for open dialogue, encouraging team members to voice concerns, share insights, and propose solutions without hesitation. This exchange enhances the effectiveness of the FMEA process and fosters a sense of unity and shared responsibility towards the project’s success. Consequently, FMEA not only improves project outcomes through meticulous risk management but also strengthens team dynamics by cultivating an environment where communication is valued and encouraged.
  • Cost Reduction: Early detection and mitigation of risks, a fundamental principle of FMEA, play a pivotal role in significant cost savings for any project. Identifying potential failure modes at the initial stages allows for implementing more cost-effective solutions, rather than addressing these issues post-production or during operational phases when modifications can be exponentially more expensive. The proactive approach minimises the likelihood of severe defects that could lead to recalls, repairs, or redesigns, which entails substantial financial implications and resource utilisation. Furthermore, the cost associated with downtime, loss of customer trust, and potential legal liabilities can be significantly reduced by preventing the escalation of minor issues into major failures. Essentially, the investment in upfront risk assessment and mitigation strategies is dwarfed by the potential savings from averting failures that could adversely impact the project’s budget and timelines. This strategic foresight underpins the cost-effective management of projects, ensuring they are delivered within budget and without compromising quality or safety standards.
  • Quality Improvement: FMEA’s systematic approach to risk assessment is instrumental in improving the overall quality of a project. By identifying and addressing potential issues early in the project lifecycle, FMEA ensures that the final deliverables meet the highest standards of quality and reliability. This preemptive analysis empowers teams to design out or mitigate failures before they can impact the end product, thereby enhancing the quality of the project outcome. Furthermore, by focusing on the early resolution of potential defects, FMEA reduces the likelihood of costly post-release fixes, tarnishing the project’s reputation and decreasing customer satisfaction. In essence, FMEA acts as a catalyst for continuous quality improvement, fostering a culture of excellence and precision permeating every project aspect.

Implementing FMEA in Project Management

Step-by-step guide on how to implement FMEA in a project management context.

  1. Identify the Project and its Scope: The first step in implementing FMEA is to define the project for which it will be used clearly. This includes identifying the scope, objectives, and key stakeholders involved in the project.
  2. Assemble a Cross-Functional Team: FMEA requires input and collaboration from various departments within an organisation. Therefore, it is essential to assemble a diverse team with representatives from different areas, including design, production, quality control, and customer service. This ensures that all perspectives are considered in the risk assessment process.
  3. Identify Potential Failure Modes: The FMEA team should brainstorm and identify all potential failure modes for each component or process involved in the project. It is essential to think broadly and consider all possible scenarios, including those that may seem unlikely.
  4. Evaluate Severity: Once the failure modes have been identified, the team should assess the severity of each potential failure mode. This involves considering the impact on customer satisfaction, safety, and project objectives.
  5. Determine Occurrence and Detectability: The team should then evaluate how often each potential failure mode is likely to occur (occurrence) and how easily it can be detected (detectability). This helps to prioritise which failure modes require the most attention.
  6. Calculate Risk Priority Number: Using the severity, occurrence, and detectability ratings, a risk priority number (RPN) is calculated for each potential failure mode. This number is used to rank the risks in order of importance, with higher RPNs indicating higher levels of risk.
  7. Develop Mitigation Strategies: Based on the RPN rankings, the FMEA team should develop and implement mitigation strategies for the high-risk failure modes. These strategies could include design changes, process improvements, or additional quality control measures.
  8. Monitor and Review: The FMEA process is ongoing and requires continuous monitoring and evaluation. The team should regularly review the implemented mitigation strategies, assess their effectiveness, and make adjustments as necessary.
  9. Document and Communicate: It is crucial to document all aspects of the FMEA process, including the identified failure modes, risk rankings, and mitigation strategies. This information should be communicated effectively to all project stakeholders to ensure everyone is aware of potential risks and their corresponding mitigation plans.

FMEA and other Project Management Tools

Integrating FMEA with other project management tools and methodologies, such as PMBOK (Project Management Body of Knowledge) and Agile, can significantly enhance project success rates. Here are several practical tips for seamless integration of multiple sources:

  • Alignment with PMBOK Principles: Leverage FMEA in tandem with PMBOK’s risk management processes. Incorporating FMEA’s detailed risk assessment and mitigation strategies can augment the PMBOK framework by providing a deeper analysis of potential failures. This combination ensures a thorough risk management plan is developed and executed, aligning with PMBOK’s focus on high-quality project delivery.
  • Agile Integration: Agile methodologies prioritize adaptability and customer satisfaction through iterative development. FMEA can be integrated into Agile sprints as a proactive risk assessment tool. Before each sprint, conduct a mini-FMEA session focusing on the specific features to be developed. This allows the team to foresee and address potential issues early, maintaining Agile’s swift pace while enhancing product quality.
  • Cross-Functional Collaboration: Both PMBOK and Agile emphasise the importance of team collaboration. FMEA’s requirement for a cross-functional team naturally complements this, fostering a culture of open communication and collective responsibility. Continuous dialogue between the FMEA team and other project stakeholders is encouraged to ensure risks are managed effectively across all phases of project management.
  • Continuous Improvement: Adopt a mindset of constant improvement by integrating FMEA findings into the project’s lessons-learned repository. Whether following PMBOK’s structured process or Agile’s retrospective sessions, use FMEA outcomes to refine project strategies, improve processes, and enhance stakeholder satisfaction on future projects.
  • Leverage Project Management Software: Many project management software platforms offer flexibility in incorporating custom risk assessment methods like FMEA. Utilise these tools to track FMEA activities along with project timelines, sprints, or stages. Integrating FMEA into these platforms can help ensure that risk management is an ongoing process, aligned with the project’s overall progress.

By thoughtfully integrating FMEA with established project management methodologies like PMBOK and Agile, organisations can create a robust framework for managing risks, ensuring the delivery of projects that meet or exceed stakeholder expectations while adhering to the highest standards of quality and efficiency.

The Future of FMEA in Project Management

The rapid development of technology is increasingly influencing emerging trends and advancements in FMEA methodology. One significant trend is the integration of AI and machine learning algorithms, which can automate identifying and assessing potential failure modes. This speeds up the process and enhances accuracy by predicting potential failures based on historical data patterns. Furthermore, there’s a growing adoption of specialized FMEA software tools designed to streamline the entire process.

At a process level, the process FMEA is still ideal for analysing an existing process, looking for potential failures and where that failure occurs. This approach can lead to a fault tree analysis where corrective actions can be identified and process steps improved.

These tools offer features like real-time collaboration, which allows cross-functional teams to work together more efficiently, and advanced analytics capabilities, providing deeper insights into risk management strategies. Incorporating these technological advancements into the FMEA process is paving the way for more dynamic and responsive risk management strategies, enabling organizations to address potential issues with their risk levels with unprecedented speed and precision preemptively.


In this comprehensive discussion on Failure Mode and Effects Analysis (FMEA) within project management, we have traversed through its core principles, detailing every critical step from identifying potential failure modes and effects and assessing their severity, to calculating Risk Priority Numbers (RPNs) and crafting effective mitigation strategies. We outlined the symbiotic relationship between FMEA and established project management methodologies like PMBOK and Agile, showcasing how integrating FMEA can bolster overall risk and management and enhance project outcomes. 

Further, we spotlighted the evolving landscape of FMEA in the wake of technological advancements, particularly the integration of AI and machine learning, and specialised software tools designed to augment the FMEA process. These innovations promise a more dynamic and precision-focused approach to risk management, ensuring projects are not only completed on time and within budget but also with reduced risk and improved quality.

In conclusion, the role of Failure Mode and Effects Analysis (FMEA) in project management cannot be overstated. It acts as a critical tool that enables project teams to proactively identify and address potential failures before they occur, significantly reducing risks and enhancing the overall quality of project outcomes. By seamlessly integrating with established methodologies like PMBOK and Agile, FMEA aligns with and enriches the project management process. 

The future of FMEA, with its evolving technological advancements, promises even greater precision and efficiency in risk management. Ultimately, FMEA’s contribution to project management is indispensable, paving the way for more successful, predictable, and high-quality project deliveries. Its critical role in the product development process and early identification of potential issues, coupled with the development of strategic responses, ensures that projects remain on track, within budget, and above all, meet the high standards expected by stakeholders.

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Reagan Pannell

Reagan Pannell

Reagan Pannell is a highly accomplished professional with 15 years of experience in building lean management programs for corporate companies. With his expertise in strategy execution, he has established himself as a trusted advisor for numerous organisations seeking to improve their operational efficiency.

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