PFDA-FMEA-VSM application for outsourcing risk analysis

: Manufacturing corporations has the acceptance of the Outsourcing Process (OP) to im-prove industrial activities as well as to archive the revenue objectives, and with this, Risk Analysis (RA) tools are constantly used to assure expected results. Failure Mode and Effect Analysis (FMEA) is one of preferred RA tools, moreover, it is proven that FMEA adds uncertainty because of the human participation at the RA, afterward it is demonstrated that Pythagorean Fuzzy Dimensional Analysis – FMEA – Value Stream Mapping (PFDA-FMEA-VSM) method removes the uncertainty in RA, likewise it aids to the stakeholders for decision making, giving more advantages improving the use of the resources on the project. This document exhibits a real case scenario in a manufacturing firm applying PFDA-FMEA-VSM method adapted for manufacturing OP. The application of PFDA-FMEA-VSM shows solid RA results, removing the human intervention uncertainty added to the risk ranking, gives advantages to the stakeholders for visualize the main risks in detailed dia-gram, as well as make easier to take better decisions on where to apply resources and mitigate risks during OP.


Introduction
The Outsourcing Process (OP) is nowadays used by the industrial corporations with the intention to simplify their internal manufacturing activities, and to get the expected revenue while a third party manufacture their products [1]. Risk for customers and new products are also important aspects to consider during the OP process [2], likewise, the recent global COVID-19 situation is driving the firms to use OP [3], in addition, global companies look for OP as a business model [4]. Though, OP represents several risks because the intervention of different processes and cross-functional areas are interconnected [5], adding new risks for the firms to manage, making them to look for new Risk Analysis (RA) tools to mitigate the risks and archive the projected goals.
Failure Mode and Effect Analysis (FMEA) is an effective tool to manage risks because it helps to perform an extensive RA, giving a quick guide on what are main risks and how to mitigate them. FMEA is as well a common tool use during the OP [6], however, FMEA is adding uncertainty to the RA since the intervention of the human final decision on what are the risks [7], [8]. Additionally, different studies are showing how to remove the uncertainty while using the FMEA combining Multicriteria methods [9], [10], [11], [12], [13]. Furthermore, Pythagorean Fuzzy Dimensional Analysis -FMEA-Value Stream Mapping (PFDA-FMEA-VSM) [14], is a proved method to remove the uncertainty during the RA. PFDA-FMEA-VSM. Furthermore, it adds the advantage to allow the stakeholders taking better decisions before the OP execution, meanwhile improving where to allocate the budget using just the required resources at the right process step, and risk identified.
This document presents a real case scenario in a manufacturing company, using the PFDA-FMEA-VSM method to perform a RA before manufacturing OP. Furthermore, a comparison between conventional FMEA and PFDA-FMEA-VSM analyzing the differences.
The rest of this document is organized as follows. Section 2, described to the basic concepts required to apply PFDA-FMEA-VSM method. Then section 3, contains the real case scenario, applying PFDA-FMEA-VSM method in a manufacturing company for an OP. Later section 4 covers the results and discussion. Finally, section 5 includes the conclusion of this work.

Basic Concepts
This segment shows the main concepts used to deploy PFDA-FMEA-VSM method and to apply it in a manufacturing OP. The full details of the used methodology can be found in [14]. Definition 1. Subject Matter Expert team (SMEt), is the group of OP experts which analyze the OP steps and performs the RA. The SMEt should be created by the project leader considering at least three experts, desirable from different functional areas. Definition 2. SME weights (SMEw) assignation, refers to a value assigned to each SME member, based on their OP experience. The sum of the SME weights must be equal to 1. It is suggested that the project leader assigned the SME weights.
During this exercise, the SMEt is formed by three senior managers from different functional areas, since the three experts have similar experience in OP, the SMEw are divided by equally.

Results and Discussion
This section shows the PFDA-FMEA-VSM application result, along with the comparison between the conventional FMEA analysis and the PFDA-FMEA-VSM analysis, this comparison is just for reference and to remark the advantages of the PFDA-FMEA-VSM method. Table 1 shows the list of the risks identified during the SMEt assessment.   Following, the PFDA-FMEA-VSM ranking in Table 2. Following, the VSM future state is executed. SMEt agreed to select the top 15 risks as potential threads, highlighted in Figure 3. For comparison proposes, a conventional FMEA was performed by the same SMEt, Table 3 depicts the FMEA results. SMEt considered to mitigate any risk above RPN of 25.  5  3  5  75  4  Product validation  5  5  3  75  5  Supplier capacity issues  5  5  3  75  6  Sales projection inaccurate  5  5  3  75  7  Product changes not communicated  5  3  3  45  8  Poor supplier quality  5  3  3  45  9   Manufacturing issues not communicated  3  2  3  18  10 Manufacturing errors, bad execution  3  2  3  18  11 Poor engineering changes implementation  3  3  3  27  12 Project scope changes  3  3  3  27  13 KPI bad results from supplier  5  Conventional FMEA assessment shows 31 identified risks above 25 RPN value, while PFDA-FMEA-VSM top 15 ranking captured the main risks to consider as potential real threats for the OP project.

Conclusions
A recurrent issue identifying risks in OP, is the uncertainty added by the human intervention ranking the risks, moreover by using PFDA-FMEA-VSM method, this problem is solved and improves OP with significant advantages over the conventional FMEA. Following, a list of the primary benefits of using PFDA-FMEA-VSM for OP.
• Ranking uncertainty removed • Clear visibility on the risks to be mitigated • Optimize resources mitigating just the major risks • Visual risks identification, where and when is the risk PFDA-FMEA-VSM method was at first used to new product introduction process, moreover, this application reveals that it is well adapted to OP making clear and easier the OP. Likewise, there is a value added using this method, because of the risk classification by area and the project period.
Furthermore, future works are considered applying and adapting PFDA-FMEA-VSM to other processes, as well as trying to automate the process using a programmed software.