Case studies are also introduced to demonstrate the real value of condition-based
maintenance, the advantage of cost avoidance and risk mitigation for high-value assets.
Integrated Vehicle Health Management Business Case Theory and Practice
Directed at industry professionals as well as researchers and students, Integrated
Vehicle Health Management: Business Case Theory and Practice fills an important
gap in this emerging body of knowledge which unites the technical and the business
aspects of a paradigm shift.
Jennions
Integrated Vehicle Health Management
Business Case Theory and Practice
Edited by Ian K. Jennions
Following the best seller, Integrated Vehicle Health Management: Perspectives on an
Emerging Field, the new title Integrated Vehicle Health Management: Business Case
Theory and Practice takes the subject to the next level. This time it addresses the
commercial justification for the adoption of a new modus operandi in asset health
management, and its impact on business strategy and servitization of technology.
The book tackles the most important questions on the transformation of business from
selling a product, and deriving future income from spare part sales, to selling a service in
which income is received in return for effective maintenance of the asset.
Highlights of the book include:
•
•
•
•
How to calculate the return on investment of an IVHM system
How real options can be used for decision making
How the availability of prognostic information affects maintenance
The business potential of structural health monitoring in aeronautics
Integrated Vehicle Health Management: Business Case Theory and Practice includes
interviews with manufacturers and suppliers on how they are marketing one-of-a-kind
services, and opening up new and sustainable revenue streams.
About the Editor
Ian K. Jennions is Professor of IVHM and Director of the IVHM Centre,
Cranfield University, UK. His impressive career spans over 30 years.
Having held senior positions at Rolls-Royce, ABB, and GE, his extensive
background involves work on aerodynamics (CFD), heat transfer,
combustion, mechanical design, and IVHM specifically related to gas
turbine applications. In July of 2008, he joined Cranfield University to
lead the newly formed IVHM Centre, contributing to both its educational
and industrially focused research aspirations.
Integrated Vehicle
Health Management
Business Case Theory and Practice
Edited by Ian K. Jennions
R-414
Table of Contents
Acknowledgments..................................................................................................... ix
Chapter 1 Introduction............................................................................................ 1
by Ian K. Jennions, IVHM Centre, Cranfield University
1.1Background.......................................................................................................2
1.2Scope..................................................................................................................2
1.3 Value Chain Analysis......................................................................................3
1.4 Book Structure.................................................................................................. 5
1.5References.........................................................................................................6
Chapter 2 Making Business Cases for Health Management—
Return on Investment............................................................................................... 7
by Peter A. Sandborn, CALCE, University of Maryland
2.1Introduction...................................................................................................... 8
2.2 Health Management Cost Modeling.............................................................9
2.3 Return on Investment...................................................................................13
2.4 The Business of Availability......................................................................... 17
2.5Conclusions....................................................................................................20
2.6References.......................................................................................................21
Chapter 3 Using Real Options to Valuate Decisions for Systems
with Prognostic Capabilities..................................................................................23
by Gilbert Haddad, Schlumberger; Peter A. Sandborn and Michael G. Pecht, CALCE, University of Maryland
3.1 Decision Support for Systems with Prognostic Capabilities................... 24
3.2 Options Enabled by PHM............................................................................ 26
3.3 The Waiting Option.......................................................................................27
3.4 Maintenance Options to Quantify Flexibility Enabled by PHM............ 28
3.5 An Approach to Valuating the Waiting Option for PHM........................ 30
3.6 Example: Wind Turbines.............................................................................. 33
3.7Conclusions....................................................................................................36
3.8References....................................................................................................... 37
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Chapter 4 Quantification of System-Level Business Effects of IVHM..........39
by Vitali Volovoi, Georgia Institute of Technology
4.1Motivation......................................................................................................40
4.2 Architecture Issues........................................................................................ 41
4.3 Modeling Frameworks..................................................................................42
4.4 A Simple Example......................................................................................... 44
4.5 Modeling Scalability Issues..........................................................................51
4.6Conclusions....................................................................................................52
4.7References.......................................................................................................52
Chapter 5 Asset Management and Its Implications for IVHM.......................55
by Charlie Dibsdale, OSyS
5.1Introduction.................................................................................................... 56
5.2 Brief Overview of the PAS 55 Model.......................................................... 56
5.3 How Does IVHM Interact with the Overall Asset Management?.......... 57
5.4 Performance Measures for IVHM............................................................... 57
5.5 IVHM and Its Influences on Other Processes Mandated by PAS 55...... 63
5.6 Prerequisites for a Failure Mode to Be a Candidate Item for IVHM...... 66
5.7Conclusions....................................................................................................66
5.8References.......................................................................................................67
Chapter 6 Maintenance Cost Analysis—Leveraging
Prognostic Information...........................................................................................69
by Michael J. Roemer, Impact Technologies, A Sikorsky Innovations Company
6.1Introduction.................................................................................................... 70
6.2 Risk-based Maintenance Cost Analysis...................................................... 70
6.3 Reliability and Prognostic Information...................................................... 72
6.4 Business Case Analysis of Maintenance Strategies................................... 74
6.5 Optimizing the Maintenance Scheduling Process.................................... 76
6.6Conclusions....................................................................................................79
6.7References.......................................................................................................79
Chapter 7 Business Potential of Structural Health Monitoring
in Aeronautics...........................................................................................................81
by Christian Boller, Fraunhofer IZFP Saarbrücken/Dresden & Saarland University
7.1Introduction.................................................................................................... 82
7.2 Strategic Aspects of SHM Implementation................................................ 83
7.3 The Process of SHM Potential Determination........................................... 86
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7.4 Determining SHM Potentials along a D-check..........................................88
7.5 Determining SHM Potentials for Drop-outs.............................................. 91
7.6Conclusions....................................................................................................96
7.7References.......................................................................................................97
Chapter 8 The Costs and Benefits of IVHM: Recent Research......................99
by Tonci Grubic, Cranfield University
8.1
8.2
8.3
IVHM and Servitization.............................................................................. 100
Research Design and Methodology.......................................................... 101
Challenges in Articulating and Calculating Benefits
of IVHM Technology................................................................................... 103
8.4Conclusions..................................................................................................107
8.5References.....................................................................................................107
Chapter 9 Safety and IVHM................................................................................ 109
by Kai Goebel, NASA Ames Research Center
9.1Introduction.................................................................................................. 110
9.2 Does Safety Matter?..................................................................................... 110
9.3 Safety as a Driver for Operations in Space and Aeronautics................ 112
9.4 Safety as a Mandate..................................................................................... 115
9.5Conclusions..................................................................................................122
9.6References.....................................................................................................123
Chapter 10 The View from the Frontline........................................................... 127
10.1Introduction.................................................................................................. 127
10.2 The Advantage of Global Networks Integration—the Power
of Anticipation (Airbus).............................................................................. 128
10.3 The Fundamental Importance of Asset Knowledge
(The Boeing Company)...............................................................................130
10.4 The Power of Niche Focus and New Technologies (Embraer)............. 132
10.5 The Invaluable Value of Data (Hamilton Sundstrand Corp.)............... 134
10.6 When Costs Rule (India National Aerospace Laboratories).................. 136
10.7 Deep Changes: Not Easy but Necessary (Meggitt PLC)........................ 138
Chapter 11 IVHM at Work: Case Studies.........................................................141
11.1Introduction.................................................................................................. 142
11.2 Taking Risks: The Qualitative Approach.................................................. 142
by Chris Pomfret, Treble One LLC
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11.3 The Return on Investment of Health Management
in Wind Turbines: A Quantitative Analysis............................................. 149
by Peter A. Sandborn, CALCE, University of Maryland; Taoufik Jazouli, CSSI Inc.;
and Gilbert Haddad, Schlumberger
11.4References.....................................................................................................154
Chapter 12 Concluding Remarks.......................................................................155
by Ian K. Jennions, IVHM Centre, Cranfield University
Index.........................................................................................................................159
About the Authors..................................................................................................165
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