Risk Reduction Strategy QSB-Plus

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Quality Systems Basics Plus

RISK REDUCTION

“Going From Reactive to Proactive”


This presentation was developed by General Motors Corporation Global Purchasing & Supply Chain and PSA Supplier Development.
All rights reserved. No part of this material may be reproduced in any form, or by any method,
for any purpose, without written permission of General Motors Global Purchasing & Supply Chain or PSA Supplier Development.
Global Purchasing and Supply Chain

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RISK REDUCTION
Risk Reduction, what are we searching for?

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RISK REDUCTION
PFMEA Overview
PFMEA definition

Consequences on:
Process Customer Plant, How Often Actions to reduce Severity/
How good is
name/ Ultimate Customer, does it Occurrence/ Detection
this method of
number and Govt Regulations happen? ratings?
finding it?
purpose ? • Design Change
• Process Changes
How Bad is • Special Controls
it? What Controls are in place
to: • Changes to Standards,
What could go wrong? procedures
Why part reject at Op? Prevent / reduce
occurrence of causes
What would be What are the
unacceptable to customer Cause(s) Detect failure mode
described in
How could part not
terms of
conform to spec.
something RISK PRIORITY NUMBER (RPN) = S x O x D
that can be
corrected / S = Severity O = Occurrence D = Detection
controlled.
1 = Lowest 1000 = Highest

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RISK REDUCTION
PFMEA Overview
• PFMEA’s shall be developed and maintained by cross-functional teams.

• PFMEA team members have to be trained for PFMEA process. Site Leadership
should review the need for PFMEA training at least once per year.

• PFMEA’s shall take into account all manufacturing operations from individual
components to assemblies and include all support processes within plant that can
impact the manufacturing and assembly operations.

• PFMEA’s shall:
–Conform to customer requirement (current AIAG or PSA guidelines),
– Have accurate Severity/Occurrence/Detection ratings,
– Be updated on a regular basis (living documents),
– Be utilized for Continuous Improvement.

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RISK REDUCTION
PFMEA risk reduction process
Suppliers are required to have a formal and documented risk reduction process:
•Proactive RPN Reduction Process - Reducing the risk of potential quality
failures (e.g.: reverse PFMEA Process),
•Reactive RPN Reduction Process – reducing the risk of past quality issues.

PFMEA proactive risk reduction process


Upon completion of the PFMEA review:
• Establish and maintain a list of the highest Risk Reduction
opportunities based on the PFMEA documents.
• An action plan or equivalent shall be utilized by the cross-
functional team to track progress in reducing the RPN ratings.

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RISK REDUCTION
Risk prioritization
Once Severity, Occurrence and Detection have been defined, PFMEA team must decide if
further efforts are needed to reduce the risk.
One approach to assist in action prioritization to use Risk Priority Number (RPN):
RPN = Severity(S) x Occurrence (O) x Detection (D)
PSA’s RPN threshold for recommended action is 36.
GM has not defined RPN threshold (it is not a recommended practice for determining the
need for action) in accordance with AIAG FMEA Reference Manual.

An example for prioritization decided by PFMEA team (Example)


1. High Severity (9 or 10)
2. High S/D combination
3. High S/O combination
4. High O/D combination

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RISK REDUCTION
List of the Highest Risk Reduction Opportunities (Example)

(Proactive)
RPN Completion Revised
No. OP No. Function & Failure Mode Value Who Recommended Actions Date RPN

SENSOR TO DETECT
1 10 INCORRECT BEARING INSTALLED 490 B. SHAD BEARING TYPE 12/1/2008 112

INCORRECT OR REVERSED
2 20 SUBASSEMBLY 126 N. ADAMS INSTALL LASER STATION 12/31/2008 42

INSTALL POST ON ASSEMBLY


3 50 HOLE MISSING 168 S. BROWN FIXTURE 12/23/2008 42

4 60 INCORRECT LABEL 112 V. WAGNER IMPLEMENT SCANNER 1/30/2009 21

The number of RPN reduction opportunities on the list is dependent


on complexity of parts and process, technology, time, resources, customer feedback
and other factors.

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RISK REDUCTION
Periodic review of PFMEA, what are we searching for?

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RISK REDUCTION
PFMEA Review Process
Cross-functional teams shall review PFMEA’s periodically.
• The frequency and/or number of PFMEA reviews shall be determined by
supplier leadership based on:
– customer expectations (customer complaints, 5 whys, launch activities,
etc.),
– process capability (FTQ, SPC, etc.),
– changes to the process (Error proofing, Tier 2 changes, etc.).
• Criteria to prioritize which PFMEA to review include:
– product from an acquisition, tool move or change in supplier,
– PFMEA developed without adequate cross-functional involvement,
– PFMEA for part(s) with history of customer complaints, warranty,
– Occurrence ratings (FTQ, scrap, etc.) have changed significantly,
– PFMEA with oldest revision dates.

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RISK REDUCTION
PFMEA Review Process (Continued)
• PFMEA shall be reviewed and updated based on the following:
– verification that all operations/processes (paint, heat treat, material
handling, labelling, rework/repair, etc.) are included and accurate,
– all process controls are included,
– Detection ratings are accurate,
– Occurrence ratings are analysed using data (SPC, FTQ, Verification
Station, scrap rate, Layered Process Audits results, etc.).
– Verification that the PFMEA meets customer requirements and
expectations (AIAG, PPAP, launch etc.).

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RISK REDUCTION
Reverse PFMEA Process
• Reverse PFMEA definition
•Reverse PFMEA is an on-station review of all failure modes included in PFMEA
conducted by cross-functional team, focused to verify that all failure modes have
proper controls (prevention/detection) and they are working properly.

• Reverse PFMEA purpose


•Reverse PFMEA is intended as a tool to assist in PFMEA reviews and RPN reduction
efforts based on actual data from in-station audits of all the failure modes.
•This review is an attempt to discover or create new Potential Failure Modes not
considered during PFMEA development as well as validate Occurrence and Detection
ratings based on real data.

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RISK REDUCTION
(Example)
Reverse PFMEA Process
Reverse-PFMEA Flow Diagram
According to the calendar start audit in scheduled station by a cross-functional team
(e.g.: quality, production, engineering, maintenance, etc) with PFMEA and checklist
to review every failure mode described in PFMEA

The failure mode has NO


proper controls
(prevention/Detection)?

Develop action plan for


YES all non conformances
found during the audit

Are the controls


NO
(prevention/detection)
working properly?
YES

YES Once all Failure Modes are


All Failure Modes in YES verified, next step is try to New Potential
Verify next failure mode in PFMEA PFMEA verified? create or find new potential Failure Modes
FM’s not included in PFMEA found?

NO NO
END

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RISK REDUCTION
Reverse PFMEA Process
Top half of form Checklist (Example)

Bottom half of form

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RISK REDUCTION
General risk assessment, what are we searching for?

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RISK REDUCTION
General risk assessment
• Systematic approach is used to identify potential risks which could impact to
plant normal processes, activities which covers risks such as:
– Un-availability of key resources (electricity, pressured air, water etc.),
– Breakdown of key processes
– Breakdown of key tierX suppliers,
– Disasters (fire, flood, earthquake etc.),
– Strikes, etc.
• Formalized process of evaluation and control of risks are defined.
• The responsibilities of evaluation and management of risks are clearly
established, coherent with the typology of the risks
• Managed by top management.
• Prevention and reaction plans are defined and delpoyed. When applicable, plan
is audited and simulations is carried out.
• The risks and the associated plans are periodically reviewed based on the plant,
corporate and external lessons learnt.

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RISK REDUCTION
General risk evaluation (Example)

Plant FMEA
    1st
Evaluation
Action plan
Updated
Evaluation

Risk Impacts S D Criticity Owner Actions S D Criticity

1. Human Ressources  
Social Conflict (Strike) Enable to produce or
deliver 3 1 3 XXXX Doc Ref.xxxx 2 1 2
Wages too low Loss of critical
competencies                
Heavy rate of absenteism Enable to produce                
Major safety issue Equipement blocked due
to legal investigation
               
…. ….                

Scoring
Severity
1 2 3
No customer Customer plant Customer plant
impact minor disruption stop

Detection
1 2 3
Very High High Low

Criticity = Severity x Detection


Threshold = 3

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RISK REDUCTION
Effectiveness, what are we searching for?

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RISK REDUCTION
RPN reduction summary (Example)

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RISK REDUCTION
What goes wrong ?
•PFMEA is a „one man show”.

•Scoring is not according to customer guidelines.

•Scoring is not consistent.

•Primary detection method relies heavily on visual inspection.

•Failure modes are missing, not revised at work station.

•Internal/external PPM are not used for Occurrence.

•Scoring driven by low RPN or set by action limit.

•New scoring is not revised after recommended action implementation.

•High risk item identified but not controlled by SQ tools.

•Management is not involved & does not allocate resources for regular reviews.

•PFMEAs not used for continuous improvement - only updated when problems occur.

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