Wallace R. Blischke

Warranty Cost Analysis

For products sold with warranty, the manufacturer incurs costs resulting from the servicing of failures occurring under warranty. These costs depend on several factors, the most important being the reliability of the product. For planning purposes, the manufacturer must estimate (a) the expected cost of warranty per unit sold and (b) the expected cost per unit time over the product life cycle. This must be done in the product development stage. This article deals with models that may be used to obtain these cost estimates for products sold with free-replacement and pro rata warranties. Keywords: warranty; reliability; cost analysis; cost models; free-replacement warranty; pro rata warranty

Product warranty management -- I: A taxonomy for warranty policies

Effective management of product warranty requires proper evaluation of alternative warranty policies. Many different types of warranty policies are in common use. Still others are discussed in the literature on product warranty. In this paper we formulate a taxonomy for warranty to assist the manager responsible for product warranty in choosing appropriate alternatives for evaluation before a final choice is made.

Product warranty management — III: A review of mathematical models

A variety of mathematical models have been developed to study different aspects of warranty. In this paper we carry out a comprehensive review of these models by classifying them into three categories based on consumer, manufacturer and public policy decision maker perspectives.

Case Studies in Reliability and Maintenance

Contributors. Preface. Introduction and Overview (Wallace R. Blischke and D. N. P. Murthy). PART A: CASES WITH EMPHASIS ON PRODUCT DESIGN. Space Interferometer Reliability-Based Design Evaluation (Donald H. Ebbeler, et al.). Confidence Intervals for Hardware Reliability Predictions (Chun Kin Chan and Michael Tortorella). Allocation of Dependability Requirements in Power Plant Design (Seppo Virtanen and Per-Erik Hagmark). PART B: CASES WITH EMPHASIS ON DEVELOPMENT AND TESTING. The Determination of the Design Strength of Granite Used as External Cladding for Buildings (Malcolm J. Faddy, et al.). Use of Sensitivity Analysis to Assess the Effect of Model Uncertainty in Analyzing Accelerated Life Test Data (William Q. Meeker, et al.). Virtual Qualification of Electronic Hardware (Michael Osterman, et al.). Development of a Moisture Soak Model for Surface-Mounted Devices (Loon Ching Tang and Soon Huat Ong). Construction of Reliable Software in Resource-Constrained Environments (Mladen A. Vouk and Anthony T . Rivers). Modeling and Analysis of Software System Reliability (Min Xie, et al.). Information Fusion for Damage Prediction (Nozer D. Singpurwalla, et al.). PART C: CASES WITH EMPHASIS ON DEFECT PREDICTION AND FAILURE ANALYSIS. Use of Truncated Regression Methods to Estimate the Shelf Life of a Product from Incomplete Historical Data (William Q. Meeker and Luis A. Escobar). Determining Software Quality Using COQUALMO (Sunita Chulani, et al.). Use of Extreme Values in Reliability Assessment of Composite Materials (Linda C. Wolstenholme). Expert Judgment in the Uncertainty Analysis of Dike Ring Failure Frequency (Roger Cooke and Karen Slijkhuis). PART D: CASES WITH EMPHASIS ON MAINTENANCE AND MAINTAINABILITY. Component Reliability, Replacement, and Cost Analysis with Incomplete Failure Data (Nicholas A. J. Hastings). Maintainability and Maintenance-A Case Study on Mission Critical Aircraft and Engine Components (U. Dinesh Kumar and John Crocker). Photocopier Reliability Modeling Using Evolutionary Algorithms (Michael Bulmer and John Eccleston). Reliability Model for Underground Gas Pipelines (Roger M. Cooke, et al.). RCM Approach to Maintaining a Nuclear Power Plant (Gilles C. Zwingelstein). Case Experience Comparing the RCM Approach to Plant Maintenance with Modeling Approach (Xisheng Jia and Anthony H. Christer). PART E: CASES WITH EMPHASIS ON OPERATIONS OPTIMIZATION AND REENGINEERING. Mean Residual Life and Optimal Operating Conditions for Industrial Furnace Tubes (Elsayed A. Elsayed). Optimization of Dragline Load (Peter G. A. Townson, et al.). Fords Reliability Improvement Process-A Case Study on Automotive Wheel Bearings (Karl D. Majeske, et al.). Reliability of Oil Seal for Transaxle-A Science SQC Approach at Toyota (Kakuro Amasaka and Shunji Osaki) PART F: CASES WITH EMPHASIS ON PRODUCT WARRANTY. Warranty Data Analysis for Assessing Product Reliability (Peter C. Sander, et al.). Reliability and Warranty Analysis of a Motorcycle Based on Claims Data (Bermawi P. Iskandar and Wallace R. Blischke). Index.

Product warranty management. II : An integrated framework for study

There are many different aspects to warranty and a proper study of the subject requires a framework to integrate these in an effective manner. The systems approach offers such a framework. In this paper we focus our attention mainly on system characterization, the first step of the systems approach. We present alternate forms of system characterization for the study of warranty from three different perspectives, those of the consumer, the manufacturer and the public policy decision-maker. A system characterization is the starting point for model building. We briefly discuss the building of models for warranty study. A comprehensive review of the models developed in the past to study different aspects of warranty is done in the third of this sequence of papers.

Strategic warranty management: a life-cycle approach

The role of warranty has become increasingly important, both as a promotional (particularly where competing products are nearly indistinguishable) and as a protectional device (for complex and expensive products where customers need some assurance). Offering warranty implies additional cost to the manufacturer over the period from product launch to obsolescence. This cost is influenced by technical decisions made prior to the launch. This paper develops a strategic approach to warranty management where warranty-related decisions are made in a framework encompassing the product life cycle and from a business perspective which links technical and commercial issues.

On the Tabulation of the Renewal Function

A generalized cubic splining algorithm enables us to evaluate recursively-defined convolution integrals for a wide variety of distribution functions. This algorithm has been used to evaluate the renewal function, the variance function, and the integral of the renewal function for five distributions (gamma, inverse Gaussian, lognormal, truncated normal, and Weibull) for a wide range of values of the shape parameter of each. The results of the computations are described and a comparison is made with previous tabulations.

Renewal Tables: Tables of Functions Arising in Renewal Theory.

Abstract : The generalized cubic splining algorithm enables us to evaluate recursively-defined convolutions for a wide variety of distribution functions. The algorithm has been applied to evaluate the renewal function, variance function and the integral of the renewal function for five distributions (gamma, inverse Gaussian, lognormal, truncated normal and Weibull) for a wide range of values of the shape parameter. The results of the computations are discussed and a comparison is made with previous tabulations. (Author)

A simulation model for warranty analysis

Abstract A computer simulation model is developed to yield simulated warranty costs for various combinations of warranty provisions and product life distributions. The inputs to the model are the form of the life distribution (gamma, Weibull, or truncated normal) and its parameters, the lengths of the warranty period and of the life cycle of the item, whether or not the warranty renews upon failure of an item, the form of the rebate function, the sellers and buyers costs and claim validation cost, the probabilities of a claim being made, validated, and of a new purchase being made, the form and rate of the discounting function, and the number of replications of the simulation desired. The output of the model are the mean and standard deviation of the n simulated costs generated for a given set of inputs. The model is validated by comparing its output against the true expected costs generated by a mathematical model in a few special situations where this is possible.

An Assessment of Alternative Models in Warranty Analysis

Abstract This paper synthesizes the existing quantitative models for warranty valuation and notes the specific shortcomings of each of these models for practical use. A general model is developed which incorporates all of the features of the existing first-failure models. Through an attempt to extend the general model to the multiple-failure case it is shown that the existing multiple-failure models are inadequate to model real-world warranty situations.