By Fred Schenkelberg
When a product or system fails there is a consequence. Often there is a loss of value. A warranty replacement costs money. Downtime may result in lost revenue. Do you know the full extent of the costs involved when something fails?
Remember your customer is using your solution for the value it creates for them. If your product fails, your customer does not achieve the expected value. They may also incur other harm.
The cost of a failure, the cost of unreliability, starts includes the costs internal and external to your organization. Warranty is just one element of the costs.
Let’s consider the most expensive aspect of your reliability program. It’s not testing. From lost engineering time, wasted production capacity, eroded brand value, to real losses at the customer’s business, the costs of a failure add up. Understanding the full costs helps to provide a balance in all aspects of decision making when creating a product or system.