ABSTRACT
The objective of this book is to provide a framework to managers and engineers to develop and implement a reliability program for their organization that provides information that goes beyond verification that reliability requirements are met. Reliability analysis also provides information that defines life-cycle cost events that enables performance of engineering economic analyses. Engineering economic analyses investigate design and sustainability alternatives to enable engineers and managers to make life-cycle economic decisions under uncertainty. Engineering economic analysis is no different than financial analysis taught in business schools. Engineering economic analyses characterize
1. Cash flows over an evaluation period [Cash flows are cost estimates made for present, recurring, and
future amounts.] 2. Equivalent financial metrics based on the time value of money
[Equivalent financial metrics are present values of cash transactions in a specific time period, net present values for all present values, and equivalent recurring values of net present values.]
Engineering economic analysis applies to
1. Design of systems 2. Systems engineering and integration 3. Maintenance and sustainability of systems
It enables engineers and managers to determine the lowest life-cycle costs for part selection, design configuration options, implementation of maintenance practices, spare parts strategies, and logistical resources.
