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Manual for Life Cost Based FMEA

The average cost to replace circuit boards for a magnet power supply is $500. This includes the cost of the manual labor to fix the boards and the cost to replace necessary components on the board.

3.1.3. Opportunity Cost

Opportunity cost is the cost that incurs when a failure inhibits the main function of the system and prevents any value creation. In a particle collider this would be the inability to generate particle collisions and hence no data for the experimental particle physicists. Opportunity cost is calculated using the following equation:

Opportunity Cost = Loss Time x Hourly Opportunity Cost



Loss Time = {Detection Time + Fixing Time + Delay Time}

The setting of the hourly opportunity cost might be easier to understand if one thinks of losing the opportunity to create particle collisions while broken device is repaired. Think about a case where staff is sitting idle while the accelerator has no beam. The power sources will not be turned off for repairs taking a few hours, so the electricity bill will be the same as if the beams were there. A third consideration is the value of the whole facility; some experts argue that the capital cost of the accelerator should be included in the hourly opportunity cost. In which case you amortize the several billion dollar construction cost over the total number of required operating hours in a 30 year operating life.

As you will see from the example costs for the ILC (if it had been built in about 2002) given below there can be large differences between the 3 opportunity costs evaluated in 3 different ways. But note that even the lowest hourly opportunity cost is order of magnitude higher than the hourly labor rate for the repair technicians. Three different numbers are used in this analysis:

$10,000/hour: Only direct labor is considered (Technicians, Physicists and Staff) $25,000/hour: Direct labor + electricity that is consumed by the ILC during shutdown. $50,000/hour: Direct labor + Electricity + Depreciation of the ILC ($6B) over 30 year period. 3.2. Frequency and Probability

Frequency is either the number of failure events or the probability for a specific failure to happen during a given period of time. A frequency value of “0.1”, for a design related failure means that there is a 10% chance a mistake will occur during

the design process. “1” for failures that

Thus, it is not possible to have a frequency value greater than have root causes that trace back to design, manufacturing, and

assembly stages. Failures that have root causes in assembly values of any real number in the frequency column.





FMEA MANUAL By S. Rhee and C.M. Spencer


January 2009

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