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A start-up cannot simply be considered a smaller version of an established company. They often rely on short and informal development processes because they lack data and experience from implementing similar projects in the past. These factors are among those that lead to lower success in organizational performance and new product launches. The NPD process is well researched, but these studies are often on larger companies, and the applicability for start-ups is highly questionable. One of these NPD tools is the FMEA.

FMEA has been proven and established for decades in various industries. However, these success scenarios often depend on sufficient resources in terms of staff and project budget. Start-ups often lack the resources to deal with major NPD project failures, which can be disastrous for their survival in their market.

Despite the innovative benefits and economic growth that start-ups contribute to when they are successful with their NPD projects, there is little research on how established tools for large companies should be adapted. Therefore, these research questions were formulated to fill the gap in the current FMEA method:

RQ1: What are the challenges for start-ups when implementing FMEA? RQ2: How can FMEA implementation be adapted for start-ups overcoming novel technology challenges? 

The study consisted of a literature review and a case study. The literature review examined the key factors for FMEA implementation and the differences between start-ups and established companies. The challenges for start-ups implementing FMEA were the central question of the literature review.

The case study was conducted in a start-up company. An adapted FMEA method and template were created there. A workshop and ten interviews were held with a variety of representatives.

The results show that the biggest challenge for start-ups implementing FMEA is that it is too complex, unclear, and often too extensive. This can be changed by simplifying the FMEA, focusing on the critical risks, and ensuring that the sessions are not too long.

The proposed FMEA method is easier to use with a simplified risk assessment and fewer columns. It was found that it also is equally important to train users, hold short meetings, and limit the size of each FMEA session.