Life cycle cost analysis of a computerized numerical control machine tool: a case study from Indian manufacturing industry

Abstract

PurposeLife cycle cost (LCC) analysis is one of the key parameters in designing a sustainable product or system. The application of life cycle costing in the manufacturing industries is still limited due to several factors. Lack of understanding of LCC analysis methodologies is one of the key barriers. This paper presents a generalized framework for LCC analysis of repairable systems using reliability and maintainability principles.Design/methodology/approachThe developed LCC analysis framework and stochastic point processes are applied for the analysis of a typical computerized numerical control turning center (CNCTC) and governing equations for acquisition cost, operation cost, failure cost, support cost and net salvage value are developed. The LCC of the CNCTC is evaluated for the renewal process (RP) and minimal repair process (MRP) approach.FindingsThe LCC analysis of the CNCTC reveals that, the acquisition cost is only 7.59% of the LCC, whereas the operation, failure and support costs dominate and contribute nearly 93% of the LCC. The LCC per day for RP requires additional US$ 1.03 than that for MRP. The detailed LCC analysis of the CNCTC identifies the critical components of CNCTC and these components are: spindle motor, spindle motor cooling fan, spindle belt, drawbar, spindle bearing, oil seals, hydraulic hose, solenoid valve, tool holder, lubrication pump motor system, lubrication hose, coolant pump motor system, coolant hose, supply cables, drive battery.Originality/valueThe developed framework of LCC of a repairable system can be applied to any other repairable systems with the appropriate modifications. LCC analysis of CNCTC reveals that the procurement decision of a product or system should be based on LCC and not only on the acquisition cost. The optimum utilization of consumables such as cutting tools, coolant, oil and lubricant can save operation cost. Thus, use of high-efficiency electric motors and the usage of recommended consumables can prolong the life of several components of a system. Therefore, due consideration and attention to these parameters at product design stage itself will decrease failure and support cost and ultimately its LCC.