The Importance of Considering Fleet Size in the Lifecycle Cost Analysis of Product Service Systems

Abstract

The use of product-service systems business models is increasing in today's economy. Because the products that provide the service to the customers incur cost during their lifetime, the method of lifecycle costing finds wide-spread use. However, this paper shows the current methods have some inaccuracies when determining lifecycle costs. The methods do not consider the required number of products necessary to provide the offered service to the customers. This paper describes a new framework for lifecycle costing that includes these cost components.

Designing PSS Fleets – Consideration of the Product Architecture

“…This no longer applies for use or result-oriented PSS, because the PSS provider manufactures the products and operates the PSS. In this case, the PSS that is developed should be designed so that it is the optimal product to be operated in a PSS fleet (Schneider et al, 2020).…”

Implementation of Maintenance Strategies in the Life Cycle Costing of Product-Service Systems

“…Thus, there will be two maintenance triggers one based on the initial maintenance strategies and the second one based on adjacency and possible secondary requirements to ensure that no recently maintained or repaired components do no get replaced. If considering not just a singular product PSS but the entire fleet of products within the PSS as proposed in Figure 1 by Schneider et al (2020) additional information about the product is required to calculate the costs of the PSS. Most importantly the ability to exchange entire subassemblies during maintenance which can drastically reduce repair times and lead to a different approach in how the MTBM of the individual modules and the components within must be tracked.…”

“…Additionally, PSS usually don't contain only a singular product but multiples of the same, also referred to as a fleet. Thus these costs are driven by the costs of the individual product but also by the costs of the entire fleet of products that are necessary to enable the PSS operator to provide the service to all customers that want to buy it (Schneider et al, 2020). As shown in Figure 1 the maintenance attributes of a product are major factor not just for the costs of the individual product but also in how many products are needed to provide the service in a timely manner to all interested customers.…”

“…But in the case of a fleet the low cost product can have a lower availability which means a larger fleet is necessary resulting in an overall higher cost despite the lower individual cost. (Schneider et al, 2020) In existing models for calculating the life cycle costs of a PSS, the maintenance costs are calculated by utilising a mean time between maintenance value derived from a periodic maintenance strategy (Johannknecht et al, 2016b). But with the increased digitalization of products with concepts like the digital twin, being implemented by companies more frequently, the maintenance strategies employed by many companies change.…”