Impact of Early Life Failures in Services of Engineering Asset Fleets

Services and warranties of large fleets of engineering assets is a very profitable business where original equipment manufacturers and independent service providers offer contracts designed to cover events in day-to-day service as well as major maintenance and repairs over the life of the asset. Accurate reliability modeling, as a way to understand how the complex stochastic interactions between operating conditions and component capability define useful life, is key for services profitability. The modeling task is daunting as factors such as aggressive mission mixes introduced by operators, exposure to harsh environment, inadequate maintenance, and problems with mass production (bad batch of materials) can lead to large discrepancies between designed and observed useful lives. This paper is focused on how to quantify the impact of infant mortality in fleets of industrial assets. A simple numerical experiment is used to address the fundamental question: how does number of observations and fleet size interact with each other in fleet management? The results demonstrate that material capability, penetration of bad batch of material in the fleet, and commissioning time can drastically influence fleet unreliability. Moreover, infant mortality due to manufacturing problems/material capability is a manifestation of an outlier problem. As a consequence, the propensity to observe first failures depend on the actual fleet size. Since failure observations are used to build/update the reliability models, small fleet operators have to deal with large uncertainties when quantifying infant mortality. This impacts their ability to make provisions for service and maintenance (inventory, labor, loss of productivity, etc.). Although the large number of failure observations causes a financial burden in large fleet operators, it also allows for reduced uncertainty in building/updating the reliability models. In turn, this improves their ability to forecast future failures and make provisions for service and maintenance.