Click To Unlock The Hidden Function of ALPHA—LCC

On the surface, ALPHA's predictive maintenance is an early warning of equipment failure. The role of the intelligent supply chain management system is to efficiently and intelligently manage spare parts, but the data collected by the two systems is far more than just for these tasks.After all the collected data forms big data, ALPHA's intelligent AI architecture can also analyze the LCC of the customer equipment and equipment related components based on the data. So,what is the LCC? You may ask.

LCC (Life Cycle Cost, LCC for short) is also known as full life cycle cost. It refers to all the costs associated with the product that occur during the effective use of the product. It includes product design cost, manufacturing cost, procurement cost, use cost, maintenance cost, and disposal cost.

Basic Concept

Development Path

The life cycle cost management originated from the US military and is mainly used for the research and development and procurement of military materials. It is applicable to product fields with long product life cycle, large material loss and high maintenance costs. According to the US Department of Defense at the time, in a typical weapon system, the cost of operation and maintenance accounted for 75% of the total cost. If the cost of the weapon system increases according to the current trend, then the annual defense budget of the United States in 2045 can only buy 1 fighter.In June 1999, U.S. President Bill Clinton signed a government order. The equipment and engineering projects required by the states require an LCC report. Without LCC estimation and evaluation, no contract is allowed.

LCC technology was introduced to China in the early 1980s.China's LCC work started from the navy, and the Air Force and the Second Artillery were actively promoted.In November 1987, China Equipment Management Association established the Equipment Life Cycle Cost Committee to promote the research and application of LCC theoretical methods.The life cycle cost method has been applied in many military and civilian units and has achieved a number of results. For example, many units such as the Air Force, Navy, Second Artillery, and Aerospace of the National Defense System have achieved gratifying results in research and application of LCC.The national military standard "equipment cost-efficiency analysis" and the military use standard "weapon equipment life cycle cost estimate" have been promulgated and implemented in 1993 and 1998 respectively.In the demonstration and review of military equipment, LCC has been regarded as an indispensable content. The management system of the leadership of the Central Military Commission has also been adjusted accordingly. The General Armament Department has been set up, and the LCC work is progressing forward.In civil enterprises, universities and research institutes, many units are actively researching and applying LCC methods for equipment selection, maintenance decision-making, renovation and maintenance, and maintenance cost control.

Application

When evaluating projects and products, based on the minimum LCC, cost efficiency and LCC benefit ratio are proposed as the basis for decision making, making decision making more scientific.As the proportion of equipment maintenance costs in life cycle costs increases, LCC will become a basic requirement for users in global equipment bid evaluation.That is, when purchasing a product, the user not only considers the purchase cost, but also carefully considers the expected usage fee and maintenance fee throughout the life cycle.The requirements for LCC indicators will appear in the bidding and signing documents, and will be used as the basis for future economic responsibility.

Core Concept

The core of the LCC management philosophy is:The development and production cost (purchasing cost) of a single product is not sufficient to explain the total cost of the product. Decision makers should not consider the purchase cost and maintenance fee separately, but must combine these considerations as a full life cycle cost of the product.

Function

A comprehensive assessment of the cost of product purchase and use will help improve product performance, RAMS (Reliability, Availability, Maintainability, and Safety) while reducing post-use costs.

Calculation Model

LCC=CI+CO+CM+CF+CD

· CI（cost of investment）

· CO（cost of operation）

· CM（cost of maintenance）

· CF（cost of fault）

· CD（cost of disposal）

Based on the data collected by ALPHA, the customer's LCC is analyzed, and then the LCC results are used to assist. The predictive maintenance and intelligent supply chain management system can more effectively derive the usage habits of the customer equipment, making the customer's operation and maintenance more efficient and reduced operation and maintenance costs simultaneously.

The experience that ALPHA's system can bring to customers far exceeds the functions of the system surface, which is the service principle that ALPHA has always been committed to – providing customers with a more value-added service experience.

To find out more,please contact me anytime.

Benjamin

Tel/WeChat:+86 18669037219

Email:benjamin.yang@alpha-technology.com.au

Web:http://alpha-technology.com.au

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