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A warranty policy involving two attributes, for example time and usage, is considered. Usage is assumed to be related to time through the usage rate, which is considered to be a random variable satisfying a specified probability distribution. The paper analyzes a policy where warranty is not renewed on product failure, within the specified time period and amount of usage, but is minimally repaired. Unit cost of minimal repair, conditional on the usage rate, is assumed to be a non-linear function of the two warranty parameters. Expressions for the expected warranty costs per unit sales are derived. Applications of the results are presented through sample computations. The results demonstrate the use of warranty cost information in selecting the parameters of the warranty policy.

For certain consumer durables, such as automobiles, warranty policies involve two attributes. These could be the time elapsed since sale of the product and usage of the product at a given point in time. Warranty may be invoked by the consumer if both time and usage are within specified warranty parameters when a product failure occurs. In this chapter, we assume that usage and product age are related through a random variable, the usage rate, which may have a certain probabilistic distribution as influenced by consumer behavior patterns. Additionally, product failure rate is influenced by the usage rate and product age. The integrated model includes expected unit warranty costs, expected unit research and development costs, and expected unit production costs. It is assumed that in production, there is a learning effect with time. A multiobjective model is incorporated with the objectives being market share and proportion of expected warranty costs relative to total manufacturing expenditures per unit. The goals could be conflicting in nature. The problem then is to determine the warranty policy parameters while attaining certain desirable values of the two objectives.

Some consumer durables, such as automobiles, involve warranties involving two attributes. These are time elapsed since the sale of the product and the usage of the product at a given point in time. Warranty may be invoked by the customer if both time and usage are within the specified warranty parameters and product failure occurs. In this chapter, we assume that usage and product age are related through a random variable, the usage rate, which may have a certain probabilistic distribution as influenced by consumer behavior pattern. Further, product failure rate is influenced by the usage rate and product age. Of importance to the organization is to contain expected warranty costs and select appropriate values of the warranty parameters accordingly. An avenue to impact warranty costs is through research on product development. This has the potential to reduce the failure rate of the product. The objective then becomes to determine warranty parameters, while constraining the sum of the expected unit warranty costs and research and development (R&D) costs per unit sales, under a limited R&D budget.

The purpose of this paper is to address what a sound warranty policy entails by identifying the key variables involved in the development of a warranty program.

The sample population was composed of employees in the US division involved with high‐tech product warranties. A survey questionnaire was used to collect data from the participants.

The paper finds that the formality of the warranty policy should depend on its complexity. Differences exist between types of warranty based on the product knowledge of the buyer. Although a standardized warranty is easy to administer, as the product line diversifies, it becomes more challenging to standardize.

This study can be expanded by examining how companies balance the cost/quality/warranty ability of the product, the techniques used to allocate warranty costs, and to evaluate multiple companies/industries, perhaps with a longitudinal focus.

The formality can be used to communicate the product warranty throughout the organization. Each department has a responsibility to the customer, so team members from service, product development, and marketing should plan and develop the warranty. A standardized warranty can send a clearer message to a customer about a firm's products. Simplifying front and back‐end processing and streamlining support structures can reduce costs.

In this paper, the identified key variable is brought out in warranty management framework. The development of this framework will satisfy a current, critical need to provide guidelines with all the steps needed to develop a warranty policy.

The study aims to design the limited number of random working cycle as a warranty term and propose two types of warranties, which can help manufacturers to ensure the product reliability during the warranty period. By extending the proposed warranty to the consumer's post-warranty maintenance model, besides the authors investigate two kinds of random maintenance policies to sustain the post-warranty reliability, i.e. random replacement first and random replacement last. By integrating depreciation expense depending on working time, the cost rate is constructed for each random maintenance policy and some special cases are provided by discussing parameters in cost rates. Finally, sensitivities on both the proposed warranty and random maintenance policies are analyzed in numerical experiments.

The working cycle of products can be monitored by advanced sensors and measuring technologies. By monitoring the working cycle, manufacturers can design warranty policies to ensure product reliability performance and consumers can model the post-warranty maintenance to sustain the post-warranty reliability. In this article, the authors design a limited number of random working cycles as a warranty term and propose two types of warranties, which can help manufacturers to ensure the product reliability performance during the warranty period. By extending a proposed warranty to the consumer's post-warranty maintenance model, the authors investigate two kinds of random replacement policies to sustain the post-warranty reliability, i.e. random replacement first and random replacement last. By integrating a depreciation expense depending on working time, the cost rate is constructed for each random replacement and some special cases are provided by discussing parameters in the cost rate. Finally, sensitivities to both the proposed warranties and random replacements are analyzed in numerical experiments.

It is shown that the manufacturer can control the warranty cost by limiting number of random working cycle. For the consumer, when the number of random working cycle is designed as a greater warranty limit, the cost rate can be reduced while the post-warranty period can't be lengthened.

The contribution of this article can be highlighted in two key aspects: (1) the authors investigate early warranties to ensure reliability performance of the product which executes successively projects at random working cycles; (2) by integrating random working cycles into the post-warranty period, the authors is the first to investigate random maintenance policy to sustain the post-warranty reliability from the consumer's perspective, which seldom appears in the existing literature.

The purpose of the paper is to develop a conceptual framework that integrates the technology and commercial issues early at the design stage to minimize warranty costs in the most effective and efficient manner and also to develop a model for optimization of warranty with specific focus on reliability and warranty policies.

The critical issues in warranty are addressed which affect the warranty cost. An optimization model to achieve multiple goals like minimization of the warranty cost and improving the reliability of the product is developed using genetic algorithm as a solution methodology. The model is illustrated with a real case of automobile engine.

The results of the optimization show improvement in mean time between failures (MTBF) which results due to improvement in the product reliability and also the targeted warranty cost is achieved.

The model developed needs to be further extended with inclusion of additional decision variable such as support level offered and more objectives such as attractiveness of the warranty from the customer's view point and spares cost to the customer.

The paper provides the help to the designers at the design stage to take the decisions related to warranty in deciding the warranty parameters.

The purpose of this paper is to identify and quantify the key components of the overall cost of software development when warranty coverage is given by a developer. Also, the authors have studied the impact of imperfect debugging on the optimal release time, warranty policy and development cost which signifies that it is important for the developers to control the parameters that cause a sharp increase in cost.

An optimization problem is formulated to minimize software development cost by considering imperfect fault removal process, faults generation at a constant rate and an environmental factor to differentiate the operational phase from the testing phase. Another optimization problem under perfect debugging conditions, i.e. without error generation is constructed for comparison. These optimization models are solved in MATLAB, and their solutions provide insights to the degree of impact of imperfect debugging on the optimal policies with respect to software release time and warranty time.

A real-life fault data set of Radar System is used to study the impact of various cost factors via sensitivity analysis on release and warranty policy. If firms tend to provide warranty for a longer period of time, then they may have to bear losses due to increased debugging cost with more number of failures occurring during the warrantied time but if the warranty is not provided for sufficient time it may not act as sufficient hedge during field failures.

Every firm is fighting to remain in the competition and expand market share by offering the latest technology-based products, using innovative marketing strategies. Warranty is one such strategic tool to promote the product among masses and develop a sense of quality in the user’s mind. In this paper, the failures encountered during development and after software release are considered to model the failure process.

In this article we present an application of Gumbel's bivariate exponential distribution model in the context of estimating warranty costs of motor cycles under a new warranty policy. The problem in question is as follows: Under the present two‐dimensional warranty policy, repair costs (termed as warranty costs) of a motorcycle during the age of first six months or within the usage of 8,000 kilometers are borne by the company. To enhance customer satisfaction, the company wanted to bear the repair costs up to an age of one year or a usage of 12,000 kilometers. The problem is to estimate the expected hike in warranty costs if the warranty policy were revised as mentioned above. Using the past data, the problem is solved by studying the underlying renewal process. Gumbel's bivariate exponential distribution function is found to be useful in approximating the renewal function. Some practical difficulties posed by the past data in the analysis are highlighted and tackled in an interesting way.

This article deals with the problem of cost estimation for increased warranty time of a multi‐module product. The warranty policy of interest is two‐dimensional involving warranty limits on both age and usage of the product. Failure of the product is caused due to malfunctioning of its module(s). Warranty service is rendered through repair or replacement of the respective module(s). From the past data, it is observed that age and usage are highly correlated. Based on life (age) data, the joint life distribution of the modules is well described by multivariate exponential distribution of Marshall and Olkin. The same is utilized to estimate cost for desired warranty times by the method of simulation.

Due to the fact that the non-standard products, being used by customers, may cause failures in products with sales delays, which naturally affect the warranty policy. Thus, it seems to be necessary to study these two concepts simultaneously. The paper aims to discuss these issues.

In this paper, a model is developed for estimating the expected warranty costs under sales delay conditions when two operator costs (failing but not reported and non-failing but reported) are included.

The proposed model is validated using a numerical example for a two types of intermittent and fatal failures occur under a non-renewing warranty policy.

Sales delay is the time interval between the date of production and the date of sale. Most reported literature on warranty claims data analysis related to sales delay have mainly focussed on estimating the probability distribution of the sales delay.