Supporting Business Cases for PHM: Return on Investment and Availability Impacts

Abstract

The development and demonstration of innovative prognostics and health management (PHM) technology is necessary but not sufficient for widespread adoption of PHM concepts within systems. Without the ability to create viable business cases for the insertion of the new technology into systems and associated management processes, PHM will remain a novelty that is not widely disseminated. This chapter addresses two key capabilities necessary for supporting business cases for the inclusion and optimization of PHM within systems. First, the chapter describes the construction of life-cycle cost models that enable return on investment estimations for the inclusion of PHM within systems and the valuation of maintenance options. Second, the chapter addresses the support of availability-centric requirements (e.g., availability contracts) for critical systems that incorporate PHM, and the resulting value that can be realized. Examples associated with avionics, wind turbines, and wind farms are provided.