Reducing Maintenance Costs Using Beyond Economic Repair Analysis
A Beyond Economic Repair (BER) analysis compares the cost of repairing a product with the cost of replacement giving a company information to help decide if repairing a product is more economical than replacement. Using information from a BER analysis, repair procedures can be written so that once a pre-determined amount of time has been spent on repair without success, a product can then be replaced, spending the additional time on replacement rather than further attempts at repair. A BER analysis starts out as a prediction using anticipated repair costs for a new product to establish the amount of hours spent to attempt repair before stopping repair work and replacing the product. As individual product units are returned to the company for repair, actual repair hours can be recorded and incorporated into the repair procedures as well as the repair yield (the percentage of failed assemblies of each type that are successfully repaired) for a product. A BER analysis is developed initially for the lowest level repairable components in a product, once actual repairs have been attempted a BER cost threshold for the top level product can be established as well. Establishing a BER threshold cost is valuable for the initial determination of a product warranty, and once actual repairs have been accomplished the repair cost information will inform a company if their warranty program has been profitable. Once a product passes beyond its warranty a BER repair cost threshold will also help determine the cost for non-warranty repairs. This article will demonstrate how to perform a Beyond Economic Repair analysis and how to use the analysis to minimize maintenance costs, manage a products warranty and non-warranty repairs.
Jerry Le May
Jerry Le May is a Senior Multi-Discipline Engineer at Raytheon Missile Systems in Tucson, AZ. He performs spares predictions and cost analysis for various programs. Jerry has performed Repair Level Analysis, Repair\Discard analysis, Return on Investment analysis, Cost Benefit analysis, Beyond Economic Repair, Spares Recommendations and Operations & Support cost analysis on numerous defense and Government programs with a variety of cost analysis tools including CASA, COMPASS, Raytheon proprietary models, customer models and his own spreadsheet models. Prior to Raytheon Jerry performed logistics analysis on aerospace programs ranging from the Lockheed L-1011 airliner to the International Space Station. Jerry presented papers on Forecasting Operations and Support Costs and A Cost Benefit Analysis for Prognostics at the 2007 and 2010 ISPA/SCEA Joint Annual Conferences.