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El. knyga: Maintenance Costs and Life Cycle Cost Analysis

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(University of Maryland, Dept. of Mechanical Engineering, College Park, USA), (Luleå University of Technology, Sweden), (Lulea University of Technology, Sweden)
  • Formatas: 516 pages
  • Išleidimo metai: 18-Sep-2017
  • Leidėjas: CRC Press Inc
  • ISBN-13: 9781351650236
Kitos knygos pagal šią temą:
Maintenance Costs and Life Cycle Cost AnalysisDidesnis paveikslėlis
  • Formatas: 516 pages
  • Išleidimo metai: 18-Sep-2017
  • Leidėjas: CRC Press Inc
  • ISBN-13: 9781351650236
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Authors have attempted to create coherent chapters and sections on how the fundamentals of maintenance cost should be organized, to present them in a logical and sequential order. Necessarily, the text starts with importance of maintenance function in the organization and moves to life cycle cost (LCC) considerations followed by the budgeting constraints. In the process, they have intentionally postponed the discussion about intangible costs and downtime costs later on in the book mainly due to the controversial part of it when arguing with managers.

The book will be concluding with a short description of a number of sectors where maintenance cost is of critical importance. The goal is to train the readers for a deeper study and understanding of these elements for decision making in maintenance, more specifically in the context of asset management. This book is intended for managers, engineers, researchers, and practitioners, directly or indirectly involved in the area of maintenance. The book is focused to contribute towards better understanding of maintenance cost and use of this knowledge to improve the maintenance process.

Key Features:

Emphasis on maintenance cost and life cycle cost especially under uncertainty.

Systematic approach of how cost models can be applied and used in the maintenance field.

Compiles and reviews existing maintenance cost models.

Consequential and direct costs considered.

Comparison of maintenance costs in different sectors, infrastructure, manufacturing, transport.
Preface xix
Acknowledgments xxi
Authors xxiii
1 Relevance of Maintenance Function in Asset Management 1(60)
1.1 Purpose of Maintenance Function
1(15)
1.1.1 Maintenance Function
2(2)
1.1.2 Benefits and Risks
4(1)
1.1.3 Maintenance Process: Goals to Achievements
5(3)
1.1.3.1 Develop a Structured Maintenance Framework
6(1)
1.1.3.2 Develop a Maintenance Policy
6(1)
1.1.3.3 Develop a Maintenance Strategy
7(1)
1.1.3.4 Implement a Maintenance Management Framework
7(1)
1.1.3.5 Allocate Maintenance Resources
8(1)
1.1.4 Developing a Maintenance Program/Plan
8(2)
1.1.4.1 Outline of a Maintenance Plan
9(1)
1.1.5 Fund Maintenance: The Beginning of Maintenance Costs
10(2)
1.1.6 Developing a Basis for Maintenance Performance Measurement
12(3)
1.1.7 Maintenance World of Tomorrow
15(1)
1.1.8 e-Maintenance
15(1)
1.2 Reliability and Maintenance
16(5)
1.2.1 Reliability Engineering
17(1)
1.2.1.1 Important Capabilities of Reliability Engineers
18(1)
1.2.2 Maintenance Engineering
18(3)
1.3 Changing Role of Maintenance in Asset Management
21(11)
1.3.1 Asset Life Cycle
22(1)
1.3.2 Asset Planning
22(1)
1.3.3 Asset Creation/Acquisition
23(1)
1.3.4 Asset Operations
24(1)
1.3.5 Asset Maintenance
24(1)
1.3.6 Asset Condition/Performance
24(1)
1.3.7 Asset Replacement
25(1)
1.3.8 Asset Disposal/Rationalization
25(1)
1.3.9 Financial Management
26(1)
1.3.10 Asset Management Definition and Function
26(1)
1.3.11 Structure of Asset Management
27(1)
1.3.12 Asset Management Strategy
28(1)
1.3.13 Changing Role of Maintenance Management in Asset Management
29(1)
1.3.14 Improve Asset Maintenance Strategy or Renew the Asset?
29(3)
1.4 Physical Asset Management and Maintenance Cost
32(10)
1.4.1 What Are Assets?
33(3)
1.4.1.1 Asset Life Cycle and Strategy
33(3)
1.4.2 Maintenance and Physical Asset Management
36(2)
1.4.2.1 Getting Help in the Development of Asset Management
37(1)
1.4.2.2 Life Cycle Stages
37(1)
1.4.3 Life Cycle Processes and Interaction with Maintenance Process
38(1)
1.4.3.1 Asset Management: Standards
38(1)
1.4.4 Develop a Maintenance Information System
39(1)
1.4.5 Cost Avoidance for Physical Assets
39(3)
1.4.5.1 Business Benefits of Asset Management
40(1)
1.4.5.2 Proactive Use of Maintenance Budgets
40(1)
1.4.5.3 Improved Ability to Manage Current Resources and New Capital Assets
40(2)
1.4.5.4 Informed and Accurate Financial Planning and Reporting
42(1)
1.5 Focusing on the Bottom Line
42(15)
1.5.1 Maintenance and the Bottom Line
43(2)
1.5.2 Maintenance beyond the Bottom Line
45(1)
1.5.3 Managing Availability for Improved Bottom-Line Results
45(16)
1.5.3.1 Availability Types
46(1)
1.5.3.2 Factors Determining Availability
47(1)
1.5.3.3 Optimizing Availability
47(1)
1.5.3.4 Design of Achievable Availability
48(2)
1.5.3.5 Determining Achievable Availability for an Existing Facility
50(1)
1.5.3.6 Building the Reliability Block Diagram (RBD)
51(1)
1.5.3.7 Refining the RBD
51(1)
1.5.3.8 Obtaining Failure and Repair Data
51(1)
1.5.3.9 Closing the Gaps
52(1)
1.5.3.10 Minimizing Number and Length of Unscheduled Outages
53(1)
1.5.3.11 Improve Equipment
54(1)
1.5.3.12 Capital Improvements to Increase Availability
54(1)
1.5.3.13 Matching Availability Goals to Annual Business Needs
54(3)
References
57(4)
2 Maintenance Costing in Traditional LCC Analysis 61(66)
2.1 Traditional LCC
61(12)
2.1.1 Life Cycle Phases
62(2)
2.1.2 Considerations of Life Cycle Cost
64(7)
2.1.2.1 Problems of Traditional Design
65(1)
2.1.2.2 Problem of Cost Visibility
66(1)
2.1.2.3 Structure of Cost Breakdown
67(4)
2.1.3 Cost Categories
71(2)
2.1.3.1 Investment Costs versus Operational Costs
71(1)
2.1.3.2 Initial Investment Costs versus Future Costs
72(1)
2.1.3.3 Single Costs versus Annually Recurring Costs
72(1)
2.2 Life Cycle Cost Analysis as a Project Follow-Up for Assets
73(10)
2.2.1 Objectives of the Life Cycle Costing Methodology
75(1)
2.2.2 Estimating Life Cycle Costs
76(1)
2.2.2.1 Estimating OM&R Costs from Cost-Estimating Guides
76(1)
2.2.2.2 Estimating OM&R Costs from Direct Quotes
77(1)
2.2.3 Impact of Analysis Timing on Minimizing Life Cycle Costs
77(1)
2.2.4 Selecting Potential Project Alternatives for Comparison
78(1)
2.2.5 Effect of Intervention
79(1)
2.2.6 Estimating Future Costs
79(1)
2.2.7 Managing Cash Flow
80(1)
2.2.8 Selecting a Discount Rate
80(3)
2.2.9 Time Value of Money
83(1)
2.3 Trade-Off Tools for LCC
83(3)
2.3.1 Effectiveness, Benchmarks, and Trade-Off Information
84(2)
2.4 LCC Analysis as Maintenance DSS
86(15)
2.4.1 Maintenance as a Value Driver
89(1)
2.4.2 Typical Outcomes of Investments in Maintenance and Repair
90(2)
2.4.3 Mission-Related Outcomes
92(2)
2.4.3.1 Improved Reliability
92(1)
2.4.3.2 Improved Productivity
93(1)
2.4.3.3 Functionality
93(1)
2.4.4 Compliance-Related Outcomes
94(1)
2.4.4.1 Fewer Accidents and Injuries
94(1)
2.4.4.2 Fewer Insurance Claims, Lawsuits, and Regulatory Violations
94(1)
2.4.5 Condition-Related Outcomes
94(1)
2.4.5.1 Improved Condition
94(1)
2.4.5.2 Reduced Backlogs of Deferred Maintenance and Repair
94(1)
2.4.6 Outcomes Related to Efficient Operations
95(1)
2.4.6.1 Less Reactive, Unplanned Maintenance and Repair
95(1)
2.4.6.2 Lower Operating Costs
95(1)
2.4.6.3 Lower Life Cycle Costs
95(1)
2.4.6.4 Cost Avoidance
95(1)
2.4.6.5 Reductions in Energy Use and Water Use
96(1)
2.4.7 Stakeholder-Driven Outcomes
96(1)
2.4.8 Risks Posed by Deteriorating Assets
97(4)
2.4.8.1 Risk to Users
98(1)
2.4.8.2 Risk to Safety, Health, and Security
98(1)
2.4.8.3 Risk to Efficient Operations
99(1)
2.4.8.4 Indexes and Models for Measuring Outcomes
99(2)
2.5 Remaining Service Life as Gauge and Driver for Maintenance Expenses and Investments
101(3)
2.5.1 Service Life and Remaining Service Life
101(1)
2.5.2 Techniques for RSL Estimation and Maintenance Investment Outcomes
102(2)
2.5.2.1 Engineering Analysis
102(1)
2.5.2.2 Cost and Budget Models
102(1)
2.5.2.3 Operations Research Models
103(1)
2.5.2.4 Simulation Models
103(1)
2.5.2.5 Proprietary Models
104(1)
2.6 Uncertainty in LCC and Maintenance Cost Estimations
104(10)
2.6.1 Approaches to Uncertainty in LCC
105(1)
2.6.2 What Uncertain Variables Go into Life Cycle Costs?
106(8)
2.6.2.1 Application of LCC Techniques for Machine/Equipment Selection
110(2)
2.6.2.2 Application of LCC to Select Design Alternatives: To Design Out Maintenance or to Design for Maintenance
112(2)
2.7 LCC Data Acquisition and Tracking Systems
114(6)
2.7.1 Data, Tools, and Technologies to Support Investments in Maintenance and Repair
114(1)
2.7.2 Technologies for Asset Data Management
115(5)
2.7.3 Emerging Technologies for Data Acquisition and Tracking
120(1)
2.8 Restriction of Maintenance Role in Operation Phase
120(2)
References
122(5)
3 Maintenance Budget versus Global Maintenance Cost 127(64)
3.1 Asset Management and Annual Maintenance Budget
127(19)
3.1.1 "Selling" the Maintenance Budget
127(1)
3.1.2 Composition of Maintenance Budget
128(1)
3.1.2.1 Maintenance Budget Composition
129(1)
3.1.3 Development of an Annual Maintenance Budget
129(4)
3.1.4 Basis of a Maintenance Budget
133(8)
3.1.4.1 Maintenance Program
134(1)
3.1.4.2 Key Considerations in Maintenance Budget Decisions
135(1)
3.1.4.3 Preparing a Maintenance Budget
135(1)
3.1.4.4 Executing a Maintenance Budget
136(2)
3.1.4.5 Reviewing a Maintenance Budget
138(3)
3.1.5 Control Maintenance Costs Using the Maintenance Budget
141(1)
3.1.6 Maintenance Budgets versus Maintenance Costs
142(2)
3.1.6.1 Associated Maintenance Costs
143(1)
3.1.7 Factors Affecting the Estimate of the Maintenance Budget
144(2)
3.1.7.1 Formula for Maintenance Budget Estimate
145(1)
3.2 Cost of Labor Force: In-House versus Outsourced, Blue versus White Collar
146(12)
3.2.1 Guidelines for Choosing In-House or Outsourced Maintenance
146(2)
3.2.1.1 In-House Maintenance Considerations
147(1)
3.2.1.2 Outsourced Maintenance Considerations
147(1)
3.2.2 Outsourcing Maintenance Activities
148(4)
3.2.2.1 Expected Benefits of Outsourcing
148(3)
3.2.2.2 Potential Risks of Outsourcing
151(1)
3.2.3 Cost Determination Methodology
152(1)
3.2.4 Performance-Based Contracts
153(5)
3.2.4.1 Performance-Based Contracting Process
153(1)
3.2.4.2 Advantages and Disadvantages of Performance-Based Maintenance Contracts
154(1)
3.2.4.3 Development of Performance Indicators for Performance-Based Maintenance Contracting
155(1)
3.2.4.4 Lessons Learned Using Performance-Based Contracting in the Maintenance Function
156(2)
3.3 Spare Parts Policies for Cost Savings
158(9)
3.3.1 Spare Parts Management
159(2)
3.3.2 Spare Parts Evaluation and Optimization
161(1)
3.3.3 Inventory Analysis
162(3)
3.3.4 Determining Optimal Parameters for Expediting Policies
165(2)
3.4 Overinvestments in Maintenance and Avoided Costs
167(12)
3.4.1 Cost Savings, Avoided Costs, and Opportunity Costs
168(1)
3.4.2 Meaning of Cost Savings
169(1)
3.4.3 Concept of Avoided Cost
169(1)
3.4.4 Maintenance: Investment or Expense?
170(2)
3.4.4.1 What Are Maintenance Expenses?
171(1)
3.4.4.2 Accounting of Maintenance Expenses
171(1)
3.4.5 When Is Maintenance Work Classified as a Capital Expenditure?
172(2)
3.4.5.1 Extension of Useful Life
172(1)
3.4.5.2 Extension of Useful Life of an Asset
173(1)
3.4.6 Reduction in Future Operating Costs: Effect of Overinvestments
174(1)
3.4.7 Optimizing Maintenance as a Cost Control Measure
175(1)
3.4.8 Role of Avoided and Overinvestment Costs in Global Maintenance Cost
176(3)
3.4.8.1 Costs of Intervention
177(1)
3.4.8.2 Costs of Failures
177(1)
3.4.8.3 Cost of Storage
178(1)
3.4.8.4 Cost of Overinvestments
178(1)
3.4.8.5 Avoided Costs
179(1)
3.5 CMMS as a Maintenance Cost Control Tool
179(6)
3.5.1 Uses of Computerized Maintenance Management System
180(11)
3.5.1.1 CMMS Needs Assessment
180(1)
3.5.1.2 CMMS Capabilities
181(1)
3.5.1.3 CMMS Benefits
182(1)
3.5.1.4 Use CMMS to Save Costs by Avoiding Maintenance
183(1)
3.5.1.5 Line Maintenance Costs
183(2)
References
185(6)
4 Maintenance Performance Measurement: Efficiency 191(78)
4.1 Key Performance Indicators for Maintenance
191(12)
4.1.1 Physical Asset Management
191(3)
4.1.2 Asset Reliability Process
194(2)
4.1.3 Performance Metrics for the Maintenance Function
196(7)
4.1.3.1 Reliability Process Key Performance Indicators: Leading Measures
197(4)
4.1.3.2 Performance Analysis
201(1)
4.1.3.3 Key Performance Indicators of Maintenance Effectiveness
202(1)
4.2 Maintenance Costs
203(3)
4.2.1 Maintenance-Related Downtime
203(1)
4.2.2 Summary of KPIs for Maintenance
204(2)
4.2.3 Hierarchy of Indicators
206(1)
4.3 Financial KPIs and Their Relation to Maintenance Costs
206(10)
4.3.1 Maintenance Performance Indicators
208(2)
4.3.1.1 World-Class Indicators
208(2)
4.3.2 Economic Indicators in EN 15341
210(4)
4.3.3 Financial Perspective
214(2)
4.4 Benchmarking Financial KPIs
216(10)
4.4.1 Benchmarking Fundamentals
216(3)
4.4.1.1 Language of Benchmarking
216(2)
4.4.1.2 Competitive Analysis
218(1)
4.4.1.3 Enablers
218(1)
4.4.2 Defining Core Competencies
219(4)
4.4.3 Types of Benchmarking
223(3)
4.4.3.1 Internal Benchmarking
223(1)
4.4.3.2 Similar Industry/Competitive Benchmarking
224(1)
4.4.3.3 Best Practice Benchmarking
224(1)
4.4.3.4 Benchmarking Process
225(1)
4.5 Key Performance Indicators, Benchmarking, and Best Practices
226(11)
4.5.1 Continuous Improvement: The Key to Competitiveness
227(1)
4.5.2 Benchmarking Goals
227(1)
4.5.3 Gap Analysis
228(2)
4.5.4 Benchmarking Process
230(4)
4.5.4.1 A. Plan
230(1)
4.5.4.2 B. Search
231(1)
4.5.4.3 C. Observe
232(1)
4.5.4.4 D. Analyze
232(1)
4.5.4.5 E. Adapt
232(1)
4.5.4.6 E Improve
233(1)
4.5.5 Benchmarking Code of Conduct
234(1)
4.5.6 Traps in Benchmarking
234(2)
4.5.7 Other Pitfalls
236(1)
4.5.8 Procedural Review
236(1)
4.5.9 Final Points
237(1)
4.6 Maturity of Maintenance as a Roadmap: Outcome of Benchmarking
237(7)
4.6.1 Preventive Maintenance
239(1)
4.6.2 Inventory (Stores) and Procurement
240(1)
4.6.3 Work Flows and Controls
240(1)
4.6.4 Computerized Maintenance Management Systems Usage
241(1)
4.6.5 Technical and Interpersonal Training
241(1)
4.6.6 Operational Involvement
241(1)
4.6.7 Predictive Maintenance
242(1)
4.6.8 Reliability-Centered Maintenance
242(1)
4.6.9 Total Productive Maintenance
243(1)
4.6.10 Financial Optimization
243(1)
4.6.11 Continuous Improvement
243(1)
4.7 Attempts at Standardization from Europe (EN) and the United States (ISO)
244(15)
4.7.1 European Maintenance Standards
244(1)
4.7.2 Objective of the Harmonized Indicator Document
245(2)
4.7.2.1 Contents of Harmonized Indicators Document
246(1)
4.7.3 International Maintenance Standards
247(12)
4.7.3.1 Review of ISO 55000 Series
247(2)
4.7.3.2 Contents of ISO 55001 and Its Companion Documents
249(1)
4.7.3.3 Context of the Organization
249(1)
4.7.3.4 Leadership
250(3)
4.7.3.5 Support
253(3)
4.7.3.6 Operation
256(1)
4.7.3.7 Performance Evaluation
257(1)
4.7.3.8 Improvement
258(1)
4.8 Role of Maintenance Cost in a Maintenance Audit
259(7)
4.8.1 Conducting an Audit
261(1)
4.8.2 Historical Maintenance Audit Models
262(2)
4.8.3 Fundamental Financial Information for Maintenance Audits
264(2)
References
266(3)
5 Consequential Maintenance Cost: A Problem Area 269(50)
5.1 Economic Importance of Maintenance
269(1)
5.2 Classification of Maintenance Costs
270(9)
5.2.1 Global Cost of Maintenance
273(6)
5.2.1.1 Definitions
273(3)
5.2.1.2 Imputation of Global Cost of Maintenance
276(1)
5.2.1.3 Optimization of Global Cost
276(2)
5.2.1.4 Other Factors
278(1)
5.2.1.5 Determination of Cost of Failure
278(1)
5.2.1.6 Cost Breakdown on Shop Floor
279(1)
5.3 Costs after Downtime
279(9)
5.3.1 Reasons for Downtime
280(1)
5.3.2 Impact of Downtime
281(1)
5.3.3 Downtime Factor Analysis
281(4)
5.3.3.1 Site-Related Factors
281(1)
5.3.3.2 Equipment-Related Factors
281(2)
5.3.3.3 Crew-Level Factors
283(1)
5.3.3.4 Force Majeure
283(1)
5.3.3.5 Company Procedures and Policies
283(1)
5.3.3.6 Project-Level Factors
284(1)
5.3.3.7 Shop-Level Management Actions
284(1)
5.3.3.8 Consequences of Downtime
284(1)
5.3.4 Dynamics of Downtime
285(3)
5.3.4.1 Repair Cost
287(1)
5.3.4.2 Cost of Idle Time for Laborers, Operators, and Supervisors
287(1)
5.3.4.3 Cost of Idle Time of Equipment
287(1)
5.3.4.4 Cost of Substitute Equipment
287(1)
5.3.4.5 Project-Associated Costs
288(1)
5.3.4.6 Loss of Labor Productivity
288(1)
5.3.4.7 Other Costs
288(1)
5.4 Intangible Aspects of Maintenance Costs and Uncertainty
288(7)
5.4.1 Sources of Intangible Costs
289(1)
5.4.2 Addressing Intangible Costs
289(1)
5.4.3 Iceberg Effect and Intangible Costs
290(1)
5.4.4 Analysis of Benefits and Intangible Costs
291(4)
5.4.4.1 Intangible Benefits and Costs Defined
291(2)
5.4.4.2 MDSS Function Analysis
293(2)
5.4.4.3 Intangible Benefits of MDSS Function
295(1)
5.5 Combining Tangible and Intangible Maintenance Costs and Benefits
295(21)
5.5.1 Maintenance Practices Influencing Maintenance Costs: Causal Relations between Various Cost Factors
296(1)
5.5.2 Estimation of Cost Elements
297(3)
5.5.3 Associated Resource Impact Costs
300(1)
5.5.4 Lack of Availability and Downtime Costs
300(4)
5.5.4.1 LAD Groups
300(2)
5.5.4.2 Scenarios
302(1)
5.5.4.3 LAD Cost Model
302(2)
5.5.5 Associated Resource Impact Cost Procedure
304(3)
5.5.6 Lack of Readiness Costs
307(3)
5.5.6.1 Lack of Readiness Cost Procedure
308(2)
5.5.7 Service-Level Impact Costs
310(2)
5.5.7.1 SLI Cost Procedure
311(1)
5.5.8 Alternate Method Impact Costs
312(7)
5.5.8.1 AMI Cost Procedure
313(3)
References
316(3)
6 Maintenance Services and New Business Models: A New Way to Consider Costs 319(76)
6.1 New Maintenance Service Providers
319(12)
6.1.1 New Maintenance Network
320(1)
6.1.2 Performance Measurement of Maintenance Services
320(2)
6.1.3 Impact of Servitization on Life Cycle
322(1)
6.1.4 Life Cycle Accounting in Business Networks
323(4)
6.1.5 Managing Value in the Network
327(1)
6.1.6 Mutation of Maintenance toward Asset Management
327(3)
6.1.7 Holistic Maintenance, the Beginning of Servitization
330(1)
6.2 Impact of Business and Technological Environment on Maintenance Costs
331(20)
6.2.1 Maintenance Technology Insights and Profitability
333(1)
6.2.2 Maintenance Impact on Business Processes
333(1)
6.2.3 Industry 4.0 and Maintenance 4.0
334(4)
6.2.3.1 Maintenance 4.0
336(2)
6.2.4 State-of-the-Art Technologies and Methodologies for Maintenance
338(13)
6.2.4.1 CBM, the First Step to the Fourth Industrial Revolution in Maintenance
340(2)
6.2.4.2 PHM, One Step Ahead of CBM
342(2)
6.2.4.3 e-Maintenance: Pervasive Computing in Maintenance
344(7)
6.3 Planned Obsolescence and the End of Traditional Maintenance
351(9)
6.3.1 Key Principle and Measures
352(1)
6.3.1.1 Preemptive Measures
352(1)
6.3.1.2 Proactive Measures
353(1)
6.3.2 Types of Obsolescence and Terminology
353(1)
6.3.3 Reasons for Obsolescence
353(3)
6.3.3.1 Use of Commercial Off-the-Shelf Products
353(1)
6.3.3.2 Life Cycle Duration
354(1)
6.3.3.3 Increased Use of Electronics
355(1)
6.3.4 Obsolescence Mitigation
356(4)
6.3.4.1 Systems Engineering
356(3)
6.3.4.2 Software Engineering
359(1)
6.3.4.3 Test Phase
359(1)
6.3.4.4 Prognostics
360(1)
6.4 Outsourcing Maintenance: New Frameworks
360(15)
6.4.1 Maintenance Contracting Strategies
361(3)
6.4.1.1 Delivery Methods
362(1)
6.4.1.2 Contract Specifications
363(1)
6.4.1.3 Pricing Strategies
364(1)
6.4.2 Conclusion
364(1)
6.4.3 Main Reasons for Outsourcing
364(2)
6.4.3.1 Refocusing on Strategic Activities
365(1)
6.4.3.2 Economies of Scale and Costs
365(1)
6.4.3.3 Reorganization Policies
365(1)
6.4.3.4 Swift Technological Change
366(1)
6.4.3.5 Market Globalization
366(1)
6.4.3.6 Conclusion
366(1)
6.4.4 Outsourcing: Decision-Making Process
366(2)
6.4.4.1 Internal Costs versus External Costs
367(1)
6.4.4.2 Need for Specialized Capability of Suppliers
368(1)
6.4.5 Framework for a Win-Win Maintenance Outsourcing Relationship
368(4)
6.4.5.1 Selecting the Number of Activities to Outsource
369(1)
6.4.5.2 Selecting Which Activities to Outsource
369(1)
6.4.5.3 Selecting Which Activities are Outsourced Individually and Which Are Bundled
370(1)
6.4.5.4 Selecting a Single Outsourced Activity
370(1)
6.4.5.5 Selecting Bundled Activities
371(1)
6.4.5.6 Selecting Nearly All Activities
371(1)
6.4.5.7 Selecting the Type of Contract Specification
372(1)
6.4.5.8 Selecting a Pricing Strategy
372(1)
6.4.6 Elements in Successful Management of Outsourcing Relationship
372(2)
6.4.7 Cost of Selecting a Service Provider
374(1)
6.4.8 Benchmarking to the Current Market
374(1)
6.5 Warranty Management: Extensions and Claims
375(8)
6.5.1 Warranty Management Framework
378(1)
6.5.2 Importance of a Warranty Management System
379(1)
6.5.3 Models and Support Tools for Warranty Cost Management
380(2)
6.5.4 Adapting e-Warranty to Warranty Assistance
382(1)
6.6 Insurance: Economic Responsibility of Third Parties
383(4)
6.6.1 Breaking Down Third-Party Insurance
384(1)
6.6.1.1 Importance of Third-Party Liability Insurance
384(1)
6.6.1.2 Other Types of Third-Party Liability Insurance
385(1)
6.6.2 Economic View of the Insurance Business
385(1)
6.6.3 Equipment Maintenance Insurance
386(1)
References
387(8)
7 Maintenance Costs Across Sectors 395(84)
7.1 Maintenance Costs Across the Sectors
395(1)
7.2 Transportation Assets: Rolling Stock Case Study 1
396(8)
7.2.1 Introduction and Background
396(1)
7.2.2 Decision Models of Transport Systems Evaluation
397(7)
7.2.2.1 Assumptions and Purpose of LCCA
399(1)
7.2.2.2 Comparison of Service Process in Analyzed Variants
400(1)
7.2.2.3 System Breakdown Structure and LCC Model Development
400(2)
7.2.2.4 LCC Assessment and DSS Based on Outcomes
402(2)
7.3 Transportation Assets: Rolling Stock Case Study 2
404(6)
7.3.1 Introduction and Background
404(3)
7.3.2 Calculation of Cost and Profit Life Cycle of a Tram
407(3)
7.3.2.1 Assumptions and Purpose of LCCA
407(2)
7.3.2.2 Decision Models Considering Asset Revenues
409(1)
7.4 Infrastructure: Railway Infrastructure
410(16)
7.4.1 Introduction and Background
410(1)
7.4.2 Decision Models of Transport Systems Evaluation
410(16)
7.4.2.1 Assumptions and Purpose of LCCA with a Focus on Maintenance
411(2)
7.4.2.2 Availability: The Goal of Infrastructure Mangers
413(1)
7.4.2.3 Prediction of the Infrastructure Downtime as Budget Maintenance Optimizer
413(1)
7.4.2.4 Life Cycle Costs of Rail Infrastructure
414(2)
7.4.2.5 LCC as Supporting Decision-Making on Design and Maintenance
416(2)
7.4.2.6 Process of Railway Data Collection for Accurate LCC Estimates
418(2)
7.4.2.7 MRO and Infrastructure Expenditures
420(3)
7.4.2.8 Infrastructure Costs
423(1)
7.4.2.9 Valorization of Infrastructure Assets
424(2)
7.4.2.10 Cost of Life Extension of Deteriorating Structures
426(1)
7.5 Manufacturing Assets
426(11)
7.5.1 Introduction and Background
426(2)
7.5.2 LCC of Pumping Systems
428(9)
7.5.2.1 Assumptions and Purpose of LCCA
428(1)
7.5.2.2 Life Cycle Cost Analysis
429(1)
7.5.2.3 Data Collection for LCC and TCO Estimation
429(5)
7.5.2.4 Total Life Cycle Cost
434(2)
7.5.2.5 Lessons Learnt in LCC and TCO of Pumping Systems
436(1)
7.6 Military Equipment
437(2)
7.6.1 Introduction and Background
437(1)
7.6.2 Cost Analysis and Uncertainty
438(1)
7.6.2.1 Assumptions in LCCA
438(1)
7.6.2.2 Economic Analysis
438(1)
7.6.2.3 Cost Analysis Training
439(1)
7.7 Aviation
439(6)
7.7.1 Introduction and Background
439(3)
7.7.2 Air Transport Association (ATA)-Level Costs
442(2)
7.7.3 System and Component Reliability
444(1)
7.8 Facilities
445(6)
7.8.1 System-Level O&M Manuals
447(1)
7.8.2 Teardowns
447(1)
7.8.3 Major Resources
447(4)
7.8.3.1 Planning and Design Phase
447(1)
7.8.3.2 Construction Phase
448(1)
7.8.3.3 O&M Approach
448(1)
7.8.3.4 Life Cycle O&M
448(1)
7.8.3.5 Computerized Maintenance Management Systems
449(1)
7.8.3.6 Coordinating Staff Capabilities and Training with Equipment and System Sophistication Levels
449(1)
7.8.3.7 Non-O&M Work
450(1)
7.9 Energy
451(16)
7.9.1 Nuclear Plant Life Cycle Cost Analysis Considerations
451(1)
7.9.2 LCCA Defined
452(4)
7.9.2.1 LCCA Considerations
452(1)
7.9.2.2 Cost and Revenue Influences
452(2)
7.9.2.3 Economic Factors
454(1)
7.9.2.4 Determining Magnitude of Change
454(1)
7.9.2.5 Data Uncertainty
455(1)
7.9.3 LCCA Tools
456(5)
7.9.3.1 PRA and RAM Analysis
456(1)
7.9.3.2 LCCA Output
457(2)
7.9.3.3 LCCA Tool Selection
459(2)
7.9.4 Improvement Option Selection
461(6)
7.9.4.1 LCC Optimization Step 1: Data Collection
463(1)
7.9.4.2 LCC Optimization Step 2: Economic Screening Analysis
464(2)
7.9.4.3 LCC Optimization Step 3: Optimization with Constraint
466(1)
7.9.4.4 Step 4: Optimal Solution Process
466(1)
7.10 Mining
467(8)
7.10.1 Introduction and Background
468(1)
7.10.2 Design of Maintenance Plan
468(1)
7.10.3 Analysis of Maintenance Data
469(3)
7.10.3.1 Machine Hours
469(1)
7.10.3.2 Machine Availability
470(1)
7.10.3.3 Mean Time between Failures and Mean Time to Repair
470(2)
7.10.4 Decision Models for Maintenance Decision and Optimum Life Cycle Management
472(1)
7.10.5 Cost of Maintenance
472(1)
7.10.5.1 Fixed Costs
472(1)
7.10.5.2 Variable Cost
472(1)
7.10.6 Life Cycle Maintenance Cost
473(2)
7.10.7 Outcomes of LCCA: Added Value
475(1)
References
475(4)
Index 479
Diego Galar has a Msc in Telecommunications and a PhD degree in Manufacturing from the University of Saragossa. He has become Professor in several universities, including the University of Saragossa or the European University of Madrid. He also was a senior researcher in I3A, Institute for engineering research in Aragon, director of academic innovation and subsequently pro-vicechancellor of the university. In industry, he has been technological director and CBM manager. He has authored more than hundred journal and conference papers, books and technical reports in the field of maintenance. Currently, he is Professor of Condition Monitoring in the Division of Operation and Maintenance in LTU, Luleå University of Technology, where he is coordinating several EU-FP7 projects related to different maintenance aspects and is also involved in the SKF UTC centre located in Lulea focused in SMART bearings. He is also visiting Professor in the University of Valencia, Polytechnic of Braganza (Portugal), Valley University (Mexico), Sunderland University (UK) and NIU (USA).

Peter Sandborn is a Professor in the CALCE Electronic Products and Systems Center at the University of Maryland. Dr. Sandborns group develops obsolescence forecasting algorithms, performs strategic design refresh planning, and lifetime buy quantity optimization. Dr. Sandborn is the developer of the MOCA refresh planning tool. MOCA has been used by private and government organizations worldwide to perform optimized refresh planning for systems subject to technology obsolescence. Dr. Sandborn also performs research in several other life cycle cost modeling areas including maintenance planning and return on investment analysis for the application of prognostics and health management (PHM) to systems, total cost of ownership of electronic parts, transition from tin-lead to lead-free electronics, and general technology tradeoff analysis for electronic systems. Dr. Sandborn is an Associate Editor of the IEEE Transactions on Electronics Packaging Manufacturing and a member of the editorial board of theInternational Journal of Performability Engineering. He is a past conference chair and program chair of the ASME Design for Manufacturing and Life Cycle Conference. He is the author of over 150 technical publications and several books on electronic packaging and electronic systems cost analysis and was the winner of the 2004 SOLE Proceedings and 2006 Eugene L. Grant awards. He has a B.S. degree in engineering physics from the University of Colorado, Boulder, in 1982, and the M.S. degree in electrical science and Ph.D. degree in electrical engineering, both from the University of Michigan, Ann Arbor, in 1983 and 1987, respectively.

Uday Kumar, the Chaired Professor of Operation and Maintenance Engineering is Director of Luleå Railway Research Center and Scientific Director of the Strategic Area of Research and Innovation- Sustainable Transport at Luleå University of Technology, Luleå, Sweden. Before joining Luleå University of Technology, Dr. Kumar was Professor of Offshore Technology (Operation and Maintenance Engineering) at Stavanger University, Norway. Professor Kumar has research interest in the subject area of Reliability and Maintainability Engineering, Maintenance modelling, Condition Monitoring, LCC & Risk analysis etc. He has published more than 300 papers in International Journals and peer reviewed Conferences and has made contributions to many edited books. He has supervised more than 25 PhD Theses related to the area of reliability and maintenance. Prof Kumar has been a keynote and invited speaker at numerous congresses, conferences, seminars, industrial forums, workshops and academic Institutions. He is an elected member of the Swedish Royal Academy of Engineering Sciences.
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