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Conventional Failure Mode and Effects Analysis (FMEA) may lead to wrong decisions in terms of a company's financial objectives. Thus, the aim of this paper is to develop an improved approach to prioritizing failures within the procedure of the FMEA.

First, the current “risk priority number” (RPN) being used within the FMEA is developed. Second, a case study is conducted in cooperation with an automotive supplier in order to test the applicability and benefits of the new approach.

By implementing the cost‐oriented FMEA, quality management can be improved. In order to decide on improvement actions, costs arising from faults detected by the customer, costs of faults detected within the boundaries of the company and costs associated with false positive inspection results should be included in the evaluation of potential failures. This case study confirms the benefits of the new approach.

In order to implement this modified FMEA, a precondition is to estimate failure costs precisely and comprehensively. This precondition could constitute a serious obstacle, because quality costs are often difficult to quantify. In addition, future research should focus on the potential to include interdependencies among various failure modes and effects.

The proposed approach enables managers and designers to prevent expensive faults and hence facilitates decisions, which make better use of resources in optimising products and processes.

The paper provides a new approach to FMEA and thus contributes to the development of cost‐oriented quality management.

The purpose of this research is to examine economic approaches to evaluate different cooperation scenarios in the context of Supply Chain Management.

The value of different cooperative scenarios is analyzed in the fields of procurement and distribution planning using an analytical approach as well as simulation runs.

On the basis of the framework of Wyner and Malone coordination mechanism in the field of Supply Chain Management was examined. Using an analytical approach as well as simulation runs it can be shown that the centralized coordination scenarios usually lead to superior results compared with different decentralized approaches in the field of procurement planning and distribution planning.

Empirical data show that the difficulty in quantifying cooperation benefits is the main reason for not to implementing inter‐organizational software solutions such as Supply Chain Management software. Therefore, a prototype is developed to quantify the value of cooperation in the fields of procurement planning and distribution planning.