Method and apparatus for warranty cost calculation

• US 20060069581A1
• Filed: 09/30/2004
• Published: 03/30/2006
• Est. Priority Date: 09/30/2004
• Status: Active Grant

• Current Assignee: WSOU Investments, LLC (WSOU Holdings, LLC)
• Original Assignee: Alcatel-Lucent SA (Nokia Corporation)
• Inventors: Franklin, Paul Hampton, Chien, Ying-Che, Choudhury, Niren Cc, Remick, Paul A., Scarff, Philip L., Kher, Shirish N., Rubin, Holly-Dee, Wang, Hongzhou
• Granted Patent: US 8,131,653 B2
• Time in Patent Office: Days
• US Class Current: 705/400
• CPC Class Codes: G06Q 10/04 Forecasting or optimisation specially adapted for administrative or management purposes, e.g. linear programming or "cutting stock problem" market predictions or forecasting for commercial activities G06Q30/0202
• CPC Class Codes: G06Q 10/06 Resources, workflows, human or project management; Enterprise or organisation planning; Enterprise or organisation modelling
• CPC Class Codes: G06Q 30/012 Providing warranty services
• CPC Class Codes: G06Q 30/0283 Price estimation or determination
• CPC Class Codes: G06Q 40/08 Insurance

Abstract

Method and apparatus for calculating warranty cost includes determining values for a plurality of parameters that characterize a corresponding plurality of physical conditions of a product that is returned under warranty, determining values for a plurality of variables that characterize a customer profile for the product and evaluating an expression that calculates warranty cost based on said determined parameter and variable values. The plurality of physical conditions of the product includes the conditions of no-trouble-found (NTF), repaired, junked, and subject to further failure mode analysis (FMA). The plurality of parameters further comprises probabilities and costs that correspond to each of the physical conditions. Evaluating the above expression includes evaluating a first expression that calculates repair, product conformance and Dead-On-Arrival cost and evaluating a second expression that calculates Change Notice cost. Subsequently, the two costs are summed to arrive at the total warranty cost.

Claims

1. A method of calculating warranty cost of a product comprising:

evaluating an expression that calculates warranty cost based on at least one parameter characterizing a physical condition of a product returned under warranty and at least one variable characterizing a profile of a customer returning the product.

2. The method of claim 1 wherein the characterizations of the at least one parameter characterizing physical conditions of the product is selected from the set consisting of no-trouble-found (NTF), repaired, junked, and subject to further failure mode analysis (FMA).

3. The method of claim 2 wherein the at least one parameter is selected from the set of probabilities consisting of P_NTF, P_repair, P_junk, and P_FMA and the set of costs consisting of C_NTF, C_repair, C_junk, and C_FMA that correspond to each of the physical conditions for a product that is returned under warranty.

4. The method of claim 3 wherein the at least one variable that characterizes a customer profile for the product is selected from the set of variables consisting of:

n number of units of product under warranty

T Warranty duration or warranty period length (years)

T₀ Trial period length before the warranty period starts (years)

τ

_L warranty starting time with warranty period [τ

_L,τ

_U]

τ

_U warranty ending time with warranty period [τ

_L,τ

_U] and

β

distribution factor.

5. The method of claim 4 wherein evaluating an expression that calculates warranty cost based on said at least one parameter and said at least one variable further comprises evaluating a first expression that calculates repair, product conformance and Dead-On-Arrival cost and evaluating a second expression that calculates Change Notice cost and summing the two costs to arrive at the total warranty cost.

6. The method of claim 5 wherein the first expression is as follows:

$C_w<br><br>\left(T+T_0\right)\approx <br><br>n·<br><br>\frac{8.76⨯<br><br>{10}^{-6}<br><br>\mathrm{\lambda <br><br>}·<br><br>I<br><br>\left(\left(T+T_0\right)·<br><br>F_{\mathrm{IMF}}\right)}{P_{\mathrm{repair}<br><br>\text{\hspace{1em}<br><br>}}+P_{\mathrm{junk}}+P_{\mathrm{FMA}}}·<br><br>\left\{I<br><br>\left(P_{\mathrm{NTF}}\right)·<br><br>C_{\mathrm{NTF}}+P_{\mathrm{repair}}·<br><br>C_{\mathrm{repair}}+P_{\mathrm{junk}}·<br><br>C_{\mathrm{junk}}+P_{\mathrm{FMA}}·<br><br>C_{\mathrm{FMA}}\right\}$

where

I(P_NTF) is a no-trouble found indicator function;

λ

is a steady-state failure rate of the product;

F_IMF is an Infant Mortality Factor;

D is an adjustment factor for PC/DOA; and

$I<br><br>\left(\left(T+T_0\right)·<br><br>F_{\mathrm{IMF}}\right)=\{\begin{array}{cc}\left(T+T_0\right)·<br><br>F_{\mathrm{IMF}}+\left(D-1\right)·<br><br>F_{\mathrm{IMF}}<br><br>\text{\hspace{1em}<br><br>}& \forall <br><br>0<<br><br>T+T_0\le <br><br>1<br><br>\text{\hspace{1em}<br><br>}<br><br>\mathrm{year}<br><br>\text{\hspace{1em}<br><br>}\\ \text{\hspace{1em}<br><br>}<br><br>D·<br><br>F_{\mathrm{IMA}}+T+T_0-1& \forall <br><br>T+T_0\ge <br><br>1<br><br>\text{\hspace{1em}<br><br>}<br><br>\mathrm{years}\end{array}<br><br><br><br>\text{\hspace{1em}<br><br>}<br><br>$

7. The method of claim 5 wherein the second expression is as follows:

Cn=n·

C _s ·

P _s ·

F _s

where

C_s is the average CN/Seed Stock cost per unit of product;

P_s is the probability that a unit will be subject to CN/Seed Stock in this specified time period, with default value of 0; and

F_s is an adjustment factor with default value of 1.

8. The method of claim 1 wherein the step of evaluating further comprises a first step of calculating a first type of warranty amount and entering such amount into the expression.

9. The method of claim 8 wherein the step of evaluating further comprises a second step of calculating a second type of warranty amount and entering such amount into the expression.

10. A computer readable medium containing a program which, when executed, performs an operation of calculating warranty cost of a product comprising:

evaluating an expression that calculates warranty cost based on at least one parameter characterizing a physical condition of a product returned under warranty and at least one variable characterizing a profile of a customer returning the product.

11. The computer readable medium of claim 10 wherein the characterizations of the at least one parameter characterizing physical conditions of the product is selected from the set consisting of no-trouble-found (NTF), repaired, junked, and subject to further failure mode analysis (FMA).

12. The computer readable medium of claim 11 wherein the at least one parameter is selected from the set of probabilities consisting of P_NTF, P_repair, P_junk, and P_FMA and the set of costs C_NTF, C_repair, C_junk, and C_FMA that correspond to each of the physical conditions for a product that is returned under warranty.

13. The computer readable medium of claim 12 wherein the at least one variable that characterizes a customer profile for the product is selected from the set of variables consisting of:

n number of units of product under warranty

T Warranty duration or warranty period length (years)

T₀ Trial period length before the warranty period starts (years)

τ

_L warranty starting time with warranty period [τ

_L,τ

_U]

τ

_U warranty ending time with warranty period [τ

_L,τ

_U] and

β

distribution factor.

14. The computer readable medium of claim 13 wherein evaluating an expression that calculates warranty cost based on said at least one parameter and said at least one variable further comprises evaluating a first expression that calculates repair, product conformance and Dead-On-Arrival cost and evaluating a second expression that calculates Change Notice cost and summing the two costs to arrive at the total warranty cost.

15. The computer readable medium of claim 14 wherein the first expression is as follows:

$C_w<br><br>\left(T+T_0\right)\approx <br><br>n·<br><br>\frac{8.76⨯<br><br>{10}^{-6}<br><br>\mathrm{\lambda <br><br>}·<br><br>I<br><br>\left(\left(T+T_0\right)·<br><br>F_{\mathrm{IMF}}\right)}{P_{\mathrm{repair}<br><br>\text{\hspace{1em}<br><br>}}+P_{\mathrm{junk}}+P_{\mathrm{FMA}}}·<br><br>\left\{I<br><br>\left(P_{\mathrm{NTF}}\right)·<br><br>C_{\mathrm{NTF}}+P_{\mathrm{repair}}·<br><br>C_{\mathrm{repair}}+P_{\mathrm{junk}}·<br><br>C_{\mathrm{junk}}+P_{\mathrm{FMA}}·<br><br>C_{\mathrm{FMA}}\right\}$

where

I(P_NTF) is a no-trouble found indicator function;

λ

is a steady-state failure rate of the product;

F_IMF is an Infant Mortality Factor;

D is an adjustment factor for PC/DOA; and

$I<br><br>\left(\left(T+T_0\right)·<br><br>F_{\mathrm{IMF}}\right)=\{\begin{array}{cc}\left(T+T_0\right)·<br><br>F_{\mathrm{IMF}}+\left(D-1\right)·<br><br>F_{\mathrm{IMF}}<br><br>\text{\hspace{1em}<br><br>}& \forall <br><br>0<<br><br>T+T_0\le <br><br>1<br><br>\text{\hspace{1em}<br><br>}<br><br>\mathrm{year}<br><br>\text{\hspace{1em}<br><br>}\\ \text{\hspace{1em}<br><br>}<br><br>D·<br><br>F_{\mathrm{IMA}}+T+T_0-1& \forall <br><br>T+T_0\ge <br><br>1<br><br>\text{\hspace{1em}<br><br>}<br><br>\mathrm{years}\end{array}<br><br><br><br>\text{\hspace{1em}<br><br>}<br><br>$

16. The computer readable medium of claim 14 wherein the second expression is as follows:

Cn=n·

C _s ·

P _s ·

F _s

where

C_s is the average CN/Seed Stock cost per unit of product;

P_s is the probability that a unit will be subject to CN/Seed Stock in this specified time period, with default value of 0; and

F_s is an adjustment factor with default value of 1.

17. The computer readable medium of claim 13 wherein said at least one variable and said at least one parameter are entered into a template displayed on a display device.

18. The computer readable medium of claim 13 wherein warranty cost information resulting from the evaluation of the expression is organized in a template displayed on a display device.

19. An apparatus for performing a warranty cost calculation operation comprising:

means for accepting determined values for one or more parameters that characterize one or more corresponding physical conditions of a product that is returned under warranty;

means for accepting determining values for one or more variables that characterize a customer profile for the product; and

means for evaluating an expression that calculates warranty cost based on said determined parameter and variable values.

20. The apparatus of claim 19 wherein the one or more physical conditions of the product is selected from the set of conditions consisting of no-trouble-found (NTF), repaired, junked, and subject to further failure mode analysis (FMA).

21. The apparatus claim 20 wherein the one or more parameters is selected from the set of probabilities consisting of P_NTF, P_repair, P_junk, and P_FMA and costs C_NTF, C_repair, C_junk, and C_FMA that correspond to each of the physical conditions for a product that is returned under warranty.

22. The apparatus of claim 19 wherein the means for accepting determined values of the one or more parameters that characterize one or more corresponding physical conditions of a returned product and the one or more variables that characterize a customer profile includes an input template displayed on a display device.

23. The apparatus of claim 19 wherein the means for means for evaluating the expression that calculates warranty cost based on said determined parameter and variable values includes a CPU, support circuits and memory of a computer.

24. The apparatus of claim 19 wherein the means for evaluating the expression that calculates warranty cost further comprises evaluating a first expression that calculates repair, product conformance and Dead-On-Arrival cost and evaluating a second expression that calculates Change Notice cost and summing the two costs to arrive at the total warranty cost.

25. The apparatus of claim 24 wherein the first expression is as follows:

$C_w<br><br>\left(T+T_0\right)\approx <br><br>n·<br><br>\frac{8.76⨯<br><br>{10}^{-6}<br><br>\mathrm{\lambda <br><br>}·<br><br>I<br><br>\left(\left(T+T_0\right)·<br><br>F_{\mathrm{IMF}}\right)}{P_{\mathrm{repair}<br><br>\text{\hspace{1em}<br><br>}}+P_{\mathrm{junk}}+P_{\mathrm{FMA}}}·<br><br>\left\{I<br><br>\left(P_{\mathrm{NTF}}\right)·<br><br>C_{\mathrm{NTF}}+P_{\mathrm{repair}}·<br><br>C_{\mathrm{repair}}+P_{\mathrm{junk}}·<br><br>C_{\mathrm{junk}}+P_{\mathrm{FMA}}·<br><br>C_{\mathrm{FMA}}\right\}$

where

I(P_NTF) is a no-trouble found indicator function;

λ

is a steady-state failure rate of the product;

F_IMF is an Infant Mortality Factor;

D is an adjustment factor for PC/DOA; and

$I<br><br>\left(\left(T+T_0\right)·<br><br>F_{\mathrm{IMF}}\right)=\{\begin{array}{cc}\left(T+T_0\right)·<br><br>F_{\mathrm{IMF}}+\left(D-1\right)·<br><br>F_{\mathrm{IMF}}<br><br>\text{\hspace{1em}<br><br>}& \forall <br><br>0<<br><br>T+T_0\le <br><br>1<br><br>\text{\hspace{1em}<br><br>}<br><br>\mathrm{year}<br><br>\text{\hspace{1em}<br><br>}\\ \text{\hspace{1em}<br><br>}<br><br>D·<br><br>F_{\mathrm{IMA}}+T+T_0-1& \forall <br><br>T+T_0\ge <br><br>1<br><br>\text{\hspace{1em}<br><br>}<br><br>\mathrm{years}\end{array}<br><br><br><br>\text{\hspace{1em}<br><br>}<br><br>$

26. The apparatus of claim 24 wherein the second expression is as follows:

Cn=n·

C _s ·

P _s ·

F _s

where

C_s is the average CN/Seed Stock cost per unit of product;

P_s is the probability that a unit will be subject to CN/Seed Stock in this specified time period, with default value of 0; and

F_s is an adjustment factor with default value of 1.

27. The apparatus of claim 19 wherein warranty cost information resulting from the evaluation of the expression is organized in an output template displayed on a display device.