|Title:||Life cycle management of technical systems and integral financial modeling|
|Authors :||Breymann, Wolfgang|
|Conference details:||World Trends in Maintenance Engineering, Pretoria, 13–15 August 2013|
|License (according to publishing contract) :||Licence according to publishing contract|
|Type of review:||Not specified|
|Subjects :||Financial modeling; Life cycle management|
|Subject (DDC) :||332: Financial economics|
|Abstract:||In lifecycle management of technical systems typically different criteria are applied for valuating and optimizing financial and technical command variables. There is a divide between upper management and maintenance management which results in suboptimal decisions and inefficient use of operational resources. Overcoming these limitations will raise lifecycle management to a qualitatively new level. Our aim is to bridge this divide by means of an integrated valuation method that takes into account the costs and benefits of the whole life cycle of a technical system and is accepted by both the upper management and the maintenance management. The UFA methodology extended for non-financial companies  provides a suitable framework for this endeavour. Initially, the UFA framework was developed for the banking sector. The central part of the non-financial extension consists of a company meta model specifying the main steps of production (investment, running production, and sales of goods) and linking them to the balance sheet and P&L reporting. Maintenance costs and benefits can be included following this line. From a conceptual point of view, this approach is different from the real option approach proposed in ref. , where a production unit (a plant) is described as an option that gives the owner the right but not the obligation to produce certain goods by operating the plant. Two case studies are presented in the light of the extended UFA methodology. The first study deals with the valuation of a service level agreement based on lifetime probabilities while the second one presents an optimized replacement strategy for middle-voltage to low-voltage transformer stations with a cost reduction of up to 70%.|
|Departement:||School of Engineering|
|Organisational Unit:||Institute of Data Analysis and Process Design (IDP) |
Institute of Sustainable Development (INE)
|Publication type:||Conference Other|
|Appears in Collections:||Publikationen School of Engineering|
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