on Tools & Techniques

The New-Products manager asked me, “Your actuarial failure rate estimates (from vehicle registrations, bills-of-materials, and automotive aftermarket store sales) are for dead-forever parts with at most one failure. What if auto parts could be renewed or replaced more than once?” Chagrined, I wrote a spreadsheet program to estimate actuarial rates for renewal processes, without life data. But what is the corresponding estimator from grouped, cohort renewal counts like the Kaplan-Meier estimator for grouped, cohort failure counts?

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Fred wrote, “I would like to suggest that you continue writing articles – make them more tutorial in nature as if teaching someone the stats from scratch that you use in your articles. Instead of loads of references to papers and procedures, explain the concepts and math involved.” OK, I’ll try.

Nonparametric field reliability estimators require no unwarranted distribution assumptions and they preserve all information in data. Here’s how to compute them, without life data, while preserving all relevant information in ships and returns counts. 

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Azmat Siddiqi suggested a certification in reliability statistics in 2022. Azmat believes in knowing and using the reliability statistical information in test, installed base, failures, and service data. Thanks Azmat. 

I propose Certification in Reliability Statistics to recognize statistics knowledge, work experience, and applications. Certification in Reliability Statistics should provide assurance to employers, contractors, and collaborators that reliability statistics are estimated and used to the best extent with available data, including uncertainty quantification, with or without life data.

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The LinkedIn ASQ RRD group published this question from a reliability manager. Replies included:

• “Beta (shape parameter) should be close to 1 for more useful life. But it should not be less than 1.”
• “For Beta you would like to get as close to one as possible.”
• “A Shape of 1 within warranty is good.”
• “It depends on B2B, yes it should be close to 1 that’s within warranty.

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Generations of products have similar field reliability functions because they are designed, processed, shipped, sold, and used in similar environments by similar customers. Replacement parts have similar reliability functions depending on replacement number: 1^st, 2^nd,…. 

Biostatisticians use David Cox’ proportional hazard (PH) survival function models to quantify effects of treatment or risk factors. Proportional hazard models could describe product’s failure modes, parts’ reliabilities in successive replacements, or products’ reliabilities in successive generations. [Read more…]

The (age-specific or actuarial) force of mortality drives the demand for spares, service parts, and most products. The actuarial demand forecast is Σd(t‑s)*n(s), where d(t-s) is (age-specific) actuarial demand rate and n(s) is the installed base of age s, s=0,1,2,…,t. Ulpian, 220 AD, made actuarial forecasts of pension costs for Roman Legionnaires. (Imagine computing actuarial demand forecasts with Roman numerals.) Actuarial demand rates are functions of reliability. What if reliability changes? We Need Statistical Reliability Control (SRC).

Actuarial demand forecasts require updating as installed base and field reliability data accumulates. Actuarial failure rate function, a(t), is related to reliability function, R(t), by a(t) = (R(t)-R(t-1))/R(t-1), t=1,2,… If products or parts are renewable or repairable, then actuarial demand rate function, d(t), depends on the number of prior renewals or repairs by age t [George, Sept. 2021].

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