Risk Management in Product Development affects Other Business Systems

Project managers, sourcing or supplier management, and quality and reliability engineering: all of these functions look at risk management a little bit differently than product development functions, but designers have input into all of them. Also, some of the risk management methods from these other functions are inputs into the design process.  

Business management and marketing people look at risk management, but they’re looking at it as risk management of public perceptions of the company and how people are interacting with products and what they’re saying about it. I attended an Institute for Internal Auditors conference and I signed up for a seminar that was a panel discussion. There were five people talking about risk management. It was a very interesting panel discussion, and at the end of about 45 minutes I raised my hand and asked a question. I asked, “Where do you get the data that you need to evaluate the risk to your business?” After conferring with each other off mic, they turned back to me. One of them said, “I use Twitter the most.” And, the other ones shook their heads to agree, “I use Twitter the most also.” So, they’re looking at data and information associated with the risk management of public perceptions of a company, CEO, president, or product performance. How do designers fit into that? If the company’s products don’t perform well on the field, that reflects badly on the company.  

Project managers organize teams in order to meet deliverables. They also have a form of risk management, but it’s risk to the project not getting done at a certain time. The things they try to manage are time, resources, and money. This does affect designers and designers frequently have to communicate with project managers on those three facets.  

Sourcing or supplier management people look at risk management from a ‘stability of suppliers’ kind of viewpoint. Is the supplier going to be able to supply the product that we need long term? Are they going to be able to produce the type of volume that we need? And, also, what is the price stability going to be? Sometimes (at the beginning of the project) designers will be given a list of suppliers that they can choose from: these are the list of suppliers that we have agreements with, this is who you must use. Designers may have to work with the supplier management person in order to draft up supplier quality agreements.  

And, finally, we get to FMEA, or failure mode effects analysis. This is something that designers should be the most directly involved in. FMEAs are an analysis that evaluates potential failures, their effects, causes, and ways to control them. There are different types of FMEAs, depending on what’s being designed. You could have a Design FMEA. Or, you could have an FMEA that focuses on the user process: what could go wrong when the user is using the new device? Or, it could be on the manufacturing process. FMEAs are required by regulated industries like medical devices, automotive, and aeronautics. These industries have to have FMEAs on file because it shows evidence to third party auditors that risk management is an input into the design process and is maintained continually for post-market surveillance.  

What is interesting about all these levels of risk management is that the FMEA (that the designers are most directly involved with), can be applied to the risk management of suppliers, and it can affect the risk management that project managers are trying to control, and it can also directly affect the risk management of a business for public perceptions. The FMEA that a designer does with their quality or reliability engineer is a big input into the design process and can really have a big effect on our product design functions: is it safe, can it be easily used, and is it dependable?  

So, where does all this leave us? We can start thinking about FMEA as a holistic approach to risk management for a business and can and should interface with risk management initiatives in other business systems. Take care to make your FMEA the best it can be. Maintain it, use it and share it with other functions because risk management matters.  

What can you do today?  

  • If you’re a designer and don’t know what an FMEA is, then I encourage you to look into it more. Ask a quality engineering professional about it or reach out to me! It is the most valuable risk management tool for designers.  
  • If you already use FMEA, then take a look at your current FMEA you may be developing. Do you see the potential risk that can affect business, marketing, project, and supplier management? If so, communicate it with your cross functional team.  

As a designer you have an important job and a unique perspective to analyze risk of your design and a responsibility to communicate it so everyone can help reduce risks.