Predicting Customer-Expectation-Based Warranty Cost for Smaller-the- Better and Larger-the-Better Performance Characteristics

Document Type : Research Paper

Authors

1 Missouri University of Science and Technology, Rolla, Missouri 65409 USA

2 Lawrence Technological University, Michigan, 48075 USA

Abstract

The quality loss function assumes a fixed target and only accounts for immediate issues within manufacturing facilities whereas warranty loss occurs during customer use. Based on the two independent variables, product performance and consumers’ expectation, a methodology to predict the probability of customer complaint is presented in this paper. The formulation presented will serve as a basic model for predicting warranty loss for larger-the-better and smaller-the-better characteristics which is dependent on both product performance and customer expectation. As an example, warranty cost is estimated for automotive disc brakes to demonstrate the methodology for the smaller-the-better case. Another example of solar panels is considered for demonstrating the prediction of warranty loss for the larger-the-better characteristic.

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References

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Journal of Industrial and Systems Engineering
Volume 2, Issue 2 - Serial Number 2
August 2008
Pages 97-113

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History

  • Receive Date: 17 March 2007
  • Revise Date: 30 November 2007
  • Accept Date: 30 April 2008

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