Financial view and profitability evaluation on multi-state weighted k-out-of-n:F system reliability

A financial view is proposed for reliability evaluation of multi‐state weighted k‐out‐of‐n:F systems. Failure cost as the cost which is imposed on the components by failures is used to denote the importance weight of each component. The deterioration process of components over time is modelled by Markov chain. System failure behaviour is formulated by Universal Generating Function (UGF). Furthermore, the present value of system failure is calculated by considering time value of money. As a result, the system reliability is demonstrated as cost which is more sensible for managers. A numerical example is presented to illustrate the proposed approach. After that, a way is suggested to transform the system cost present value into system reliability value. MATLAB programming is developed to make a sensitivity analysis on example results. Therefore, the impact of maintenance activities is investigated to show how they can reduce system cost through improving the system reliability.