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Measuring Life Cycle Costs for Complex B2B Products: A Novel, Integrated and Practical Methodology across Disciplines for Pricing Maintenance Contracts

: Schlipf, Matthias; Keller, C.; Lutzenberger, Fabian; Pfosser, Stefan; Rathgeber, Andreas; Jahya, Alex


Journal of quality in maintenance engineering : JQME 25 (2019), Nr.2, S.355-375
ISSN: 1758-7832
ISSN: 1355-2511
Fraunhofer FIT ()
engineering; Life Cycle Cost; investment; B2B-product

In business-to-business (B2B) markets, awarding of contracts is based not only on a products purchase price, but rather on its overall life cycle costs (LCC). Costs associated with management engineering involve interdisciplinary tasks, such as manufacturing, service and maintenance, risk management, and end-of-life disposal. For complex B2B products, an analysis tool able to calculate the overall LCC is essential for suppliers, manufacturers, and customers. In this paper, we propose a new interdisciplinary methodology, based on a multivariate model, in order to accurately estimate the LCC of B2B products. Our proposed methodology takes into consideration technical and financial variable risks, such as mean-time-between failures, unplanned services, logistic frameworks, infrastructures of service providers, country and credit risks, and insurance opportunities, respectively. Using real industry case studies, we also show that our proposed model can be applied to analysis of the LCC structure of large diesel engines from MAN Diesel & Turbo while taking into account the inclusion of multiple factors, e.g.: complex and large amounts of engine parts, long lifetimes, and non-geographically fixed operational areas for vessels.