IATF NC case study Day22 - Missing Feasibility Study
1. NC Observation (Nonconformity Statement)
During the audit of the New Product Development (NPD) and APQP process, it was identified that Feasibility Study was not conducted for multiple RFQs (Request for Quotation). Evidence showed that customer enquiries received through email and vendor portals were directly converted into quotations and submitted to the customer without any documented feasibility review.
Additionally:
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No feasibility review checklist was available.
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Cross-functional team (CFT) involvement was not evident.
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No risk assessment (manufacturing capability, capacity, tooling, process flow, special characteristics) was conducted before quoting the price.
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Feasibility Study was not linked to APQP kickoff.
This constitutes a major nonconformity against IATF 16949 Clause 8.3.3.3 – Manufacturing feasibility analysis.
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2. Justification (Why This is a Critical Issue)
Feasibility Study is one of the most crucial steps in APQP. Skipping it creates major business and quality risks:
Quality Risks
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Manufacturing challenges not identified early lead to defects later.
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Special characteristics not assessed properly.
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Inadequate process controls because risks were not analyzed.
Operational Risks
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Lack of tooling, fixtures, or inspection capability at SOP stage.
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Unplanned investments and emergency purchases.
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Frequent engineering changes due to incorrect assumptions.
Cost Risks
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Underquoting due to incomplete cost estimation.
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Production cost higher than quoted price → loss to company.
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Rework, scrap, and customer penalties.
Customer Risks
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Inability to meet customer timelines.
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Poor launches and delivery failures.
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Customer escalation, complaints, and loss of business.
Thus, missing a Feasibility Study is not just a documentation gap — it is a strategic and financial risk that affects the entire product lifecycle.
3. Correction (Immediate Fix Done)
Once the gap was identified, the department took immediate corrective actions:
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Conducted feasibility assessment for all pending RFQs.
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Completed the feasibility study checklist based on process capability, capacity, tooling readiness, and quality requirements.
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Reviewed feasibility with the cross-functional team (Engineering, Quality, Production, Tooling, and Purchase).
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Updated the quotation for items where feasibility issues were found.
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Linked the feasibility forms to the RFQ master list for traceability.
These steps corrected the current gaps, but the system still required process-level improvements to prevent recurrence.
4. Why-Why Analysis (Root Cause Identification)
Problem: Feasibility Study not conducted for RFQs.
Why 1: Why was feasibility not conducted?
➡ RFQs were directly quoted without review.
Why 2: Why were they quoted directly?
➡ The Sales/Marketing team did not have a mandatory feasibility approval step before submitting quotations.
Why 3: Why was the approval step missing?
➡ No documented procedure or workflow existed linking RFQ → Feasibility → Quotation.
Why 4: Why was the procedure not defined?
➡ Organization assumed feasibility discussions in meetings were sufficient and did not formalize it.
Why 5: Why were informal discussions considered enough?
➡ Lack of understanding of IATF requirements and importance of a structured feasibility review.
Root Cause:
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No formal procedure mandating feasibility review.
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No feasibility checklist or documented evidence.
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Lack of cross-functional involvement in RFQ stage.
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Poor awareness of IATF Clause 8.3.3.3.
5. Corrective Action (Eliminating the Root Cause)
To prevent recurrence, the organization implemented the following corrective actions:
System Changes
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Updated APQP/NPD Procedure to include mandatory feasibility study before quotation submission.
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Developed a Feasibility Study Format covering:
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Manufacturing capability
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Capacity analysis
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Special characteristics evaluation
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Tooling/fixture requirements
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Cpk/Ppk capability feasibility
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CSR requirements
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Process flow & risk evaluation
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Integrated Feasibility Study into the RFQ → Quotation workflow.
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Implemented a CFT approval matrix for feasibility sign-off.
Process Improvements
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Created a Feasibility Master Register to track all RFQs and their status.
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Linked Feasibility Review to APQP kickoff and Management Review.
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Ensured CSR Matrix is reviewed during feasibility stage.
Training & Competency
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Trained Sales, Engineering, Quality, and Production teams on:
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APQP requirements
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Feasibility Assessment
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Costing impact
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Customer requirements
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Conducted awareness training on IATF 16949 Clause 8.3 and its importance.
6. Preventive Action (Long-Term Control)
To ensure sustainability:
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Established an RFQ workflow system (digital or manual) requiring mandatory feasibility approval before quotation.
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Added feasibility verification in Internal Audit Checklists.
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Monthly review of RFQ status and feasibility sign-offs in MRM.
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Introduced risk rating mechanism (High/Medium/Low) for RFQs.
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Added LPA checkpoints for feasibility linkage to operational controls.
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Developed lessons learned section for new projects and shared across teams.
7. Results & Outcomes
After implementing corrective and preventive measures, the organization achieved:
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100% Feasibility Study completion for all RFQs and new projects.
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Significant reduction in launch issues and customer escalations.
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Better cost estimation and improved profitability.
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Improved coordination between Sales, Engineering, Quality, Tooling, and Production teams.
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Zero major NCs in APQP area during subsequent audits.
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Enhanced system maturity and alignment with IATF 16949 requirements.
