Reference no: EM132271017
The N.V. Five-E-Colors has three similar departments where different types of dyes are made for the textile industry. Currently there is discussion about the optimal maintenance policy of pump type DO-30-W, a type that is used by the three departments.
All departments use a preventive maintenance policy with an interval of 20 weeks. Two departments (with 4 and 6 pumps respectively) are very satisfied with this frequency. The third department, however, with 10 pumps and has doubts. Two years ago they were forced to skip a maintenance job for budgetary reasons. This led to the failure of 1 pump in week 26, 2 in week 29, 2 in week 34 and 3 in week 39. The technical department of the latter department proposes to shift the maintenance frequency from 20 weeks to 30 weeks.
The maintenance engineer at the head of the maintenance departments of the 3 departments wants to check whether this adjustment of the maintenance interval could be interesting. He collects the following data:
- Review of the historical data shows that at 400 cycles (using a preventive maintenance interval of 20 weeks), only 10 pumps failed as a result of a failure: 1 in week 5, 2 in week 10, 4 in week 15 and 3 in week 18.
- The cost of a preventive maintenance service is 8,000 euros (may be assumed to be fairly stable).
- For a corrective intervention (i.e. after failure) there is an extra cost of 2000 euro in 60% of the cases and 4000 euro in 40% of the cases. This is due to the consequences of secondary damage and additional ordering and administrative costs.
Ask
1. What is the expected average cycle length for a maintenance interval of resp. 20 and 30 weeks?
2. Is it a good idea to shift the maintenance interval from 20 weeks to 30 weeks? Make a calculation of the expected annual cost difference using the Renewal Theory.
3. Starting from the concept of the bathtub curve, which conclusion would you draw in this specific case? Is this consistent with your decision in question 2? Declare.