10.1 Introduction

Reliability is probably the most important design characteristic. All other system characteristics such as maintenance, spare parts, logistic support and the cost of ownership depend heavily on the reliability of the product. Unfortunately, apart from very few industries such as defence, aerospace and nuclear, the knowledge of reliability about their own product is very limited among many industries. In fact, for many the reliability stops with MTBF. Unfortunately, many important product related decisions are made based on this most unreliable reliability measure. Most people are even unaware that only one out of three products would survive beyond its MTBF value (assuming exponential distribution). Failure to understand the true reliability would hurt any manufacturer, especially if there is a strong competition in the aftermarket. Product aftermarket spans the life cycle of the product between the end of the original equipment manufacturer's (OEM) warranty and till its end of life when the product is scrapped. Aftermarket generates 40-50% of a manufacturing companies profit and 25% of its annual revenue. Aftermarket is a very important source of revenue since many manufacturers do not make profit when they actually sell the product; the actual profit comes when they start selling the spare parts. The demand for spare parts heavily depends on the reliability of the product and thus failure to understand the reliability of the product will result in poor prediction being made of the demand of spare parts. Poor prediction about the demand for...