Product Reliability Participants part 5 FMS Reliability
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Product Reliability Participants part 5
Reliability Participants within an Organization
Continuing the series where we examine various roles within an organization and the ways in which each role
interacts and af f ects product reliability, this post will start of f with procurement engineers and managers. Since
each role hereaf ter is a bit less involved, multiple roles will be grouped together. Af ter procurement, in this post
we’ll take a look at warranty managers.
Procurement Engineers and Managers
Procurement entails working with suppliers to obtain a supply of components or materials that meet the design
requirements. T he procurement team comprises engineers, managers, and support staf f . One of its primary
goals is to minimize cost. Of ten this means procuring the lowest price f or a component that meets the design
T he reliability role f or procurement prof essionals is to obtain the best price f or a component that meets or
exceeds the reliability requirements. T hey should know the specif ic goal, including the probability of success,
duration, local environment, and use, along with the design specif ications. T he conversations with suppliers
should include conveying the reliability requirements along with learning about potential f ailure mechanisms.
Unf ortunately, the f ocus on price of ten outweighs the perceived value of f ocusing on component reliability.
Rather than building a working relationship with suppliers to quickly solve f ield issues, the f ocus should be on
preventing design and component selection errors. Adding the cost of f ailure to the price equation of ten
resets the procurement f ocus to include f inding the most reliable components.
Products with warranties of ten include a warranty policy (terms and conditions of the of f ered warranty) plus
some means to estimate f uture warranty costs and monitor warranty returns and payments.
T he reliability role may include the f ollowing:
creating and using accurate predictions of f uture f ailure rates,
minimizing the costs of the reverse supply chain, and
conducting f ailure analysis of returns and working to eliminate f uture f ailures.
A critical role is the f eedback f unction that warranty tracking provides f or the organization, as it represents the
customer experience of the product’s reliability perf ormance. Warranty acts as the scorecard.
Consider a medical device organization in which no one managed warranty. T he Chief Financial Of f icer
explained that warranty was not a major issue because it was an insignif icant annual expense. However, about
half of the products sold were returned within the warranty period. Although the manuf acturing cost of each
product was thousands of dollars, the cost of warranty was limited to the cost of the spare parts consumed
during repair. T hus, senior management was unaware of the very large f ield f ailure rate. A warranty manager
would have been responsibility f or providing clear and appropriate measures of f ield perf ormance. By
increasing the warranty expense to include a call center, f ield service engineers, and the cost of replacement
units, warranty f or this organization would have accurately ref lected the impact of such a high f ield f ailure rate.