A Model for Optimal Design of Mixed Renewable Warranty Policy for Non-Repairable Weibull Life Products under Conflict between Customer and Manufacturer Interests

A model is presented to find the optimal design of the mixed renewable warranty policy for non-repairable Weibull life products. The optimal design considers the conflict of interests between the customer and the manufacturer: the customer interests are longer full rebate coverage period and longer total warranty coverage period, the manufacturer interests are lower warranty cost and lower risk. The design factors are full rebate and total warranty coverage periods. Results showed that mixed policy is better than full rebate policy in terms of risk and total warranty coverage period in all of the three bathtub regions. In addition, results showed that linear policy is better than mixed policy in infant mortality and constant failure regions while the mixed policy is better than linear policy in ageing region of the model. Furthermore, the results showed that using burn-in period for infant mortality products reduces warranty cost and risk.

Authors:

• Saleem Z. Ramadan

Keywords:

• Reliability
• Mixed warranty policy
• Optimization
• Weibull Distribution.

References:

[1] E. A. Elsayed . Reliability Engineering. Boston, MA: Addison Wesley,
1996, pp 486-192.
[2] M. U. Thomas, "Optimal warranty policies for non-repairable items,"
IEEE Trans. Reliability, vol. R-32, no. 3, 1983 Aug, pp. 282-287.
[3] H. R. Peter, "Warranty Policies for non-repairable items under risk
aversion," IEEE Trans. On Reliability, vol. R-34, No. 2, 1985 June, pp.
147-150.
[4] Ö. Mutlu, "Determination of Optimal Pricing and Warranty Policies,"
Ph.D. dissertation, Department of Industrial and Management Systems
Engineering, West Virginia University, Morgantown, West
Virginia,1999.
[5] D.N.P. Murthy and I. Djamaludin, " New product warranty: A literature
review," Int. J. Production Economics, vol. 79, pp. 231-260, 2002.
[6] M. R. Shaharudin, K. M. Yusof, S. J. Elias, and S. W. Mansor, "Factors
Affecting Customer Satisfaction in After-Sales Service of Malaysian
Electronic Business Market," Canadian Social Science, vol.5, no.6 2009.