Make-Buy, Outsourcing & Network Design worked example

Outsource Quality Risk with defect severity if it reaches the customer of 15 score: a worked example

This scenario runs the outsource quality risk calculation on the strong side: defect severity if it reaches the customer of 15 score, with every other input held at its documented default. Use it when outsource quality risk in make-buy, outsourcing and network design needs a defensible ranking against other make-buy, outsourcing and network design risks for the next review.

The inputs for this scenario

  • Defect severity if it reaches the customer (1-10): 15 score (raised for this scenario; the documented default is 6)
  • Likelihood the supplier ships the defect (1-10): 4 score (unchanged)
  • Difficulty detecting the defect at receiving (1-10): 3 score (unchanged)

Working through the calculation

  • Applying the documented formula (Outsource quality risk score = outsource quality risk severity score × outsource quality risk occurrence score × outsource quality risk detection score) to the inputs above produces each figure below.
  • At this operating point the engine returns 8.15 score for outsource quality risk score, the number this scenario is built around.
  • At this operating point the engine returns 15 score for outsource quality risk severity score.
  • At this operating point the engine returns 4 score for outsource quality risk occurrence score.
  • At this operating point the engine returns 3 score for outsource quality risk detection score.

How this compares with the baseline

  • Against the tool's baseline example, where defect severity if it reaches the customer sits at 6 score and the headline result is 4.55 score, this scenario comes in 79.12% above the baseline at 8.15 score.
  • Use it during supplier qualification, PPAP review, or when a make-vs-buy decision moves a part to an external shop and you need to rank quality exposure. Treat this as a target state: the delta against the baseline quantifies what the improvement is worth before you commit to chasing it.

Results at a glance

  • Outsource quality risk score: 8.15 score (headline result)
  • Outsource quality risk severity score: 15 score
  • Outsource quality risk occurrence score: 4 score
  • Outsource quality risk detection score: 3 score

Run it with your numbers

  • Every input above is editable in the live Outsource Quality Risk calculator, which recalculates instantly and can be shared with the inputs intact.

Last reviewed 2026-05-12.