Preventing Process Failure with FMEA (Failure Modes & Effects Analysis)

FMEA (Failure Modes & Effects Analysis) is a Lean Six Sigma technique for identifying both the ways that a product, part, process or service can fail and the effects of those failures.Once these failure modes are identified, they are rated by the severity of their effects and failure probability. This is critical to the design of any system, process, service or product.


There are 3 types of FMEA’s; system, process and design. However in this post I will only touch upon the Process FMEA. Process FMEA’s identify the different ways that a process could fail and the effects of those failures. They are often used to identify and rank process improvement opportunities. For the lower risk failure modes preventative plans are put in place to ensure minimal impact to productivity, costs, and delivery.

For example, say a Health Tech Startup, creates an app for patient on-boarding with a plethora of functionalities that they consider to be in the “cool factor”. However, this overload of features could overwhelm the user and miss the value curve completely.  With an FMEA analysis they would be able to identify the most critical features, risks, and problems with the product before they take it to market, in turn, significantly reducing rework, product, and process costs.

Contact us now to learn more about how to minimize rework costs and identify problems in processes, systems or products before they are used or put into production.



Notable Friday Chat: Care about your employees!

Happy Friday!

I hope you’ve had a productive and enriching week. Today I want to leave you with a short message that will have a significant impact on your talent management goals and overall company wide health. I hope you have a great weekend and remember, “Success is continuous improvement!”


“Taking the time to talk to and ask atleast one employee each day how they are doing and somehow guide them in solving a professional or personal problem will in turn, help you build a stronger relationship with your employees but also support your talent management goals.


Multiple Hats Office Administration Hacks

Whether you are a Startup or an established small business a well run office is critical to the health and culture of the business. As in these types of businesses, wearing many hats is a given but with the simple hacks I’ve noted below you’ll run a smooth operation:

  1. Say no to Apple’s (5-10%) discount! Consider comparison shopping on BestBuy, Walmart, Newegg and Amazon. (I found Amazon to have the best deal most of the time).
  2. Create a visual office supplies inventory system. See how to create one here
  3. Develop HR templates for every possible scenario or activity (e.g., new hire email, potential hire interview request, harassment complaint form, et cetera.)
  4. Invest in an external hard-drive/USB to back up all your data and make sure you keep it in a fire/water proof box.
  5. Label and organize all office supplies and periodically review with team where all items are kept.
  6. Create different calendars with tiers, Tier 1 Calendar (Critical Meetings includes office and client meetings), Tier 2 (Office/HR related notices, such as, deliveries), and Tier 3 (PTO requests).
  7. Actively record all office assets with their skus, model, upc, location and employee information in an Excel sheet.
  8. If your office offers snacks and beverages, buying bulk is the way to go. Amazon and Ebay are your best bet!
  9. If your company uses Quickbooks online, utilize the recurring transactions feature to automate fixed invoices and bills.
  10. Deposit at the office! Ask your bank if they offer a check scanner as this will reduce the time it takes for you to deposit checks as you will be able to do it right from the office!

Tricks for driving growth and revenue

To drive growth and increase revenue a company must understand current and potential customers and identify uncontested opportunity in the industry. Below are a few tricks for driving growth and revenue:

  1. Gather more information from customers that hate you, are apprehensive about you, or don’t know you to identify opportunities to enter into new markets.
  2. Talk to more customers and answer more customer emails.
  3. Have more lunches with customers.
  4. Focus on products, services or solutions currently not being offered in the industry because realizing an opportunity in this aspect will prompt first-to-market revenue opportunities.
  5. Invest in your most profitable products, services or solutions and do away with the ones that erode profitability. For example, Southwest Airlines differentiated itself by not getting into the food business (low-cost business design) like its competitors instead it focused on providing customers with a great experience instead.
  6. Gain strategic dominance in atleast 2 or more of the following  (e.g., branding, patent, copyright, value chain control, 2 year product lead, 20% cost advantage, control distribution, supply control, customer information flow, unique organizational culture, et cetera) “The Profit Zone by Adrian Slywotzky”
  7. Stay abreast of industry and customer behavior and purchasing changes for the purpose of redesigning your business design to meet these new demands.

The Paid vs Unpaid Internship Conundrum

To be paid or not to be paid. That is the question. The debates are fierce in regards to internship compensation. Some consider since interns are learning they are not contributing value to the bottom line but that all depends on the company’s internship program.

For example, lets say company ABC prides itself on a well-rounded on-hands internship experience, meaning interns actually work on high priority projects and actually meet with clients or work on product/service optimization efforts. Suppose these interns are specifically chosen for their entrepreneurial spirits, intelligence and grit. Reasonable compensation would be warranted in this instance.

On the other hand, company THG rarely involves interns in projects or meetings with clients and mostly has them run errands. This would not be beneficial for the intern as they are not learning anything but when you take intern economics into consideration reasonable compensation is also warranted.

What is intern economics? Companies must consider the intern’s transportation, professional work wear expenses, lunch expenses, et cetera. Some companies may consider this not their problem but what if they find a great smart intern that has great potential but is not able to afford the transportation costs? A great mind is a terrible thing to waste.

To ensure there is a balance between value received and experience gained employers need to create internship programs that engage interns in projects where they will learn new skills but also make significant contributions to the success of the project. For example, say company THG starts to include marketing interns in data analysis and KPI reporting while being groomed by a seasoned Data Analyst and quickly learn to assess critical variables that can drive campaign optimization efforts. Value is achieved and experience is gained here.

Intern compensation should be reasonable and by no means extravagant ($200-$500/mo). Companies should value their interns just as they value their employees because they might find a “super intern” that they won’t be able to let go.

Contact me now to create your own Value Focused Internship Framework here

Lean Wednesday Tip

“Did you know that if your company leases its space from a multiple office building you can have your key financial representative analyze how utility charges are distributed amongst all tenants. This can help you realize savings and offer a negotiation opportunity based on your company’s utility use.”

Continuous Budgeting & The What Ifs

It is always good to be prepared. In business being unprepared for the unexpected could lead to loss of clients, reduced profits, damaged reputation, et cetera. Small business are not exempt from this either. Budgets and Forecasts need to include a reserve for the What ifs, such as, what if the office gets flooded?, what if a machine breaks down and a replacement is required ASAP?!, What if our supplier’s plant gets flooded?

Many companies use historical budgets (utilizing and analyzing past expenses from 3-4 past fiscal periods) to see revenue and expenses trends and using this information to create the current budget. The problem with this budget method is that it does not consider the future, therefore, it is impaired by the unforeseen. To minimize this risk, companies should assess all business operation risks and add reserves for the accounts that have “high budget risks”.

For example, let’s say your business is growing and you just finalized a big contract deal, but this is now the 2nd quarter of the fiscal year. Now you have to analyze sales, hiring and purchasing forecasting data and update the budget accordingly. This is also true when you lose a big client, you have to be prepared to revise your budget despite efforts to replace the lost client to ensure profitability at the end of the year; meaning cutting costs. budget-clipart-587364-ze-budgeting-and-savings-in-your-p-Stock-Photo

Continuous budgeting ensures that your company is abreast of all risks, revenue and expenses trends that are and could affect the company. Companies that have a frugal mindset (e.g. Apple, Microsoft, Google) and hoard their cash are always prepared for the worst. Historical budgets essentially just demonstrate the past and provide a budget amount base for all your accounts but you have to ensure sales demand, hiring, purchasing and risk data is taken into account to finalize the budget properly and update accordingly per any changes in the business.


The Customers that HATE you bring in the most valuable insights

 When utilizing the Voice of the Customer to glean insights don’t just target the customers that love you. When you take the time to really listen to the customers that hate you and turn their pains into solutions that is when you actually drive growth for your company.

Why target customers that hate you, you may ask? They have valuable insights on how your product or service can improve and can inspire you to create solutions that are currently not offered in the industry (first to market opportunities).

cust-service1Companies that are customer focused stay on top of customer pains and actually listen to them. They take more meetings with customers and work to turn client requirements into products, services or solutions.

The questions are:

Why do you hate us and what can we do to change that?

What are we doing wrong?

What are your pains?

When you acquire the answers to these questions then you can brainstorm ideas for products, services or solutions that will solve these pains. As a customer focused company you can’t be afraid to ask the hard questions. By turning customers who hate you into customers that love you will not only increase your client base and revenue but also make your competitors run for their money.

Talent Management: The Evergreen Learning Culture

 Great employees want to be challenged and learn new things. To increase employee retention and overall workplace satisfaction rates Human Resources must stay abreast of individual skills, learning capabilities, and industry skill trends. training

They should also encourage Managers/Supervisors to offer opportunities​ that allow employees to further enhance their skills, learn valuable new skills, or pursue interests. In house educational programs and ability to attend related conferences and workshops are a great way to build employee confidence and skills. Human Resources should also check in quarterly with employees to see how they are doing and gain insights into their goals, concerns, workplace bottlenecks, et cetera. This information can be used to match critical variables with other employee data for the purpose of optimizing your Talent Management processes.

By utilizing the Voice of the Employee, Human Resources and Managers should collaborate in surveying and sharing employee information for the purpose of creating in-house educational programs that will enhance employee skills.

Employers that encourage an evergreen learning culture reap the following benefits:

  • Increased overall employee satisfaction
  • See improved productivity
  • Reduced process cycle times
  • Improved client satisfaction
  • Greater profits

By actively integrating learning opportunities at the workplace employers will not only enhance employee productivity but also yield greater profits. It pays to invest in your employees!


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