Reliability Engineering and System Safety 67 (2000) 61–73

www.elsevier.com/locate/ress

A Monte Carlo methodological approach to plant availability modeling

with maintenance, aging and obsolescence
E. Borgonovo, M. Marseguerra*, E. Zio
Dipartimento di Ingegneria Nucleare, Politecnico di Milano, Via Ponzio 34/3, 20133 Milan, Italy
Received 14 March 1999; accepted 23 June 1999

Abstract
In this paper we present a Monte Carlo approach for the evaluation of plant maintenance strategies and operating procedures under
economic constraints. The proposed Monte Carlo simulation model provides a flexible tool which enables one to describe many of the
relevant aspects for plant management and operation such as aging, repair, obsolescence, renovation, which are not easily captured by
analytical models. The maintenance periods are varied with the age of the components. Aging is described by means of a modified Brown–
Proschan model of imperfect (deteriorating) repair which accounts for the increased proneness to failure of a component after it has been
repaired. A model of obsolescence is introduced to evaluate the convenience of substituting a failed component with a new, improved one.
The economic constraint is formalized in terms of an energy, or cost, function; optimization studies are then performed using the main-
tenance period as the control parameter. q 1999 Elsevier Science Ltd. All rights reserved.
Keywords: Monte Carlo simulation; Periodic maintenance; Aging; Obsolescence; Availability; Energy function; Optimization

1. Introduction approach for predicting component failures using physical

Managing an industrial plant entails evaluating and trad-
ing off the conflicting objectives of safe operation and
economic service. For this reason, the relevant reliability
studies which assess the reliability, availability and safety
levels of operation under the given maintenance and repair
strategies should be coupled with economic analyses aiming
at reducing the plant associated costs of downtime, main-
tenance and repair.
The first scientific approaches to this management
problem date back to the 1950s and 1960s and can be
found in the review paper by McCall [1] and in the book
by Barlow and Proschan [2]. As a result, various so-called
maintenance optimization models were introduced in which
both costs and benefits of maintenance were quantified and
an optimum compromise between the two was sought.
Well-known models originating from this period are the
so-called age and the block replacement models.
From the practical point of view, at that time, preventive
maintenance was strongly advocated as a means to reduce
failures and unplanned downtime. In many companies, large
time-based preventive maintenance programs were set up.
In the 1970s, condition monitoring became a popular
* Corresponding author. Fax: 1 39-2-2399-6309.
E-mail address: marzio.marseguerra@polimi.it (M. Marseguerra)
0951-8320/00/$ - see front matter q 1999 Elsevier Science Ltd. All rights reserved.
PII: S0951-832 0(99)00046-0
information on the actual state of the operating equipment.
In many instances, this approach proved more effective than
the large preventive maintenance programs: detailed studies
of the mechanisms of component failures resulted in better,
more reliable designs.
More recently, a very successful systematic method for
establishing maintenance programs, the Reliability
Centered Maintenance (RCM) method, has started to
break through in many industries [3]. This method directs
maintenance efforts towards those parts and units which are
critical from the point of view of reliability, safety and
production regularity. A decision logic and specific forms
are used to identify the worthwhile maintenance activities.
The approach is more qualitative than the optimization
models but it is more all-embracing than models which
have only a limited capability [4]. Extensions to classical
RCM are being investigated aiming at introducing mainte-
nance optimization by means of cost and reliability models.
Benefits from the introduction of statistical decision tools
are certainly expected.
Overall, this area of management has seen a flourishing
effort through the years from researchers in the fields of
operations research, management science, reliability engi-
neering [5–10]. Classical gradient descent methods [11], as
well as modern techniques such as genetic algorithms [12],
are being considered for the optimization task.
62 E. Borgonovo et al. / Reliability Engineering and System Safety 67 (2000) 61–73
λ
Zone A Zone B Zone C
Fig. 1. Typical behavior of component failure rate.
The present work locates itself within this management/
operation area with the objective of developing a methodo-
logical framework to account for many of the realistic issues
involved in plant reliability and economic management,
such as maintenance, aging and obsolescence. Generally,
these aspects are strongly interrelated so as to render an
analytical approach basically prohibitive for real scale
applications. For this reason we devote our attention to
Monte Carlo simulation which provides a flexible tool
capable of accounting for many of these aspects in a quite
straightforward manner.
In Section 2 we present the model which forms the basis
for the development of our Monte Carlo approach: failure
and repair behaviors with aging effects are considered
together with an adaptive, periodic maintenance strategy;
moreover, an appropriate cost, or energy, function is intro-
duced to assess the monetary value of the plant operation.
This cost function will provide the basis for an optimization
process of the management and operation of the system. In
analyzing different management options we will assume
that the system has already been designed to satisfy the
safety constraints; in other words, the system configuration,
redundancy allocation and component failure characteristics
have been selected so as to guarantee a certain level of
safety. Then, in the optimization we focus only on the avail-
able strategies for system maintenance, here represented by
different choices of the maintenance periods of the various
system components. In Section 2 we also present a possible
model of technological evolution and obsolescence which
can be included within the Monte Carlo simulation in a
direct way. Section 3 contains a simple application of the
model to a reference system drawn from the literature.
Section 4 shows how the Monte Carlo scheme can be
exploited to perform an optimization on the period of main-
tenance: an application to the system of reference is
provided. In the application of the model we followed the
methodological spirit of the work in that the choices of the
numerical values of the model parameters are not necessa-
rily realistic but rather they highlight certain particular
model effects. Finally, we end the paper with some general
remarks on the problem and some specific comments on the
method proposed.
2. A quantitative model for plant availability and
economic management
In this section we present the basics and fundamentals of
the Monte Carlo simulation model used for plant reliability
and availability analysis as well as for its economic evalua-
tion.
2.1. Failure and repair with aging
t As it is well known, the failure behavior of many mechan-
ical and electrical components can be described in terms of a
bath-tub time-dependent failure rate l…t† such as that of Fig.
1. Adopting a language mutated from life, we can interpret
the three zones of this figure as those corresponding to the
infancy, to the maturity and to the senility, with decreasing,
constant and increasing danger of death, respectively.
It is common practice to represent analytically this beha-
vior in terms of a composition of cumulative distribution
functions (CDFs) of the failure times, each having the
following Weibull expression:
Zt
2 l…t† dt a
F…t† ˆ 1 2 e 0 ˆ 1 2 e2…bt† …1†
where l…t† ˆ a × ba × ta21 is the time-dependent failure
rate. The corresponding probability density function
(PDF) is:
a
f …t† ˆ a × …b†a × …t†a21 × e2…bt† …2†
In the present work we shall consider a single CDF
having a monotonically increasing failure rate, i.e. a l…t†
with a . 1: This conservative assumption amounts to
considering aging effects since the beginning of the life of
the components. We shall assume that aging develops with a
value a ˆ 2:
The effects of component aging are counterbalanced by
maintenance actions, performed with period t , which reju-
venate the component. In practice, during the interval t , the
failure rate l…t† increases only slightly so that, to simplify
the calculations, we resort to exponential distributions char-
acterized by stepwise constant failure rates whose values are
determined by imposing that the probabilities of failures
within each maintenance period coincide for the Weibull
and the exponential distribution. More specifically, in the
generic interval of length t , the probability of a failure is
a
PW …t # t† ˆ 1 2 e2…bt† …3†
for the Weibull distribution, and
p
Pe …t # t† ˆ 1 2 e2l t
…4†
for the exponential distribution.
For the two CDFs to give the same probability of failure
within ‰0; tŠ the failure rate of the exponential distribution
must have the effective value (constant throughout the
 E. Borgonovo et al. / Reliability Engineering and System Safety 67 (2000) 61–73 63

cumulative distribution function probability density functions: weibull vs exponential

1 0.03
weibull: α = 1.1
0.9 exponential:λ = .0206

0.8 0.025

0.7
0.02
0.6
cdf

0.5

cdf
0.015

0.4

0.3 0.01

0.2
0.005
0.1 weibull: α = 1.1
exponential:λ = .0206
0 0
0 20 40 60 80 100 0 20 40 60 80 100
time (h) time (h)

(a)
(b)

Fig. 2. (a) Cumulative distributions: weibull (a ˆ 1:1, b ˆ 0:021) vs exponential (l ˆ 0:0206). (b) Probability density functions: weibull (a ˆ 1:1,
b ˆ 0:021) vs exponential (l ˆ 0:0206).

maintenance period)
1
lp ˆ ba ta21 ˆ l…t† …
a failures to later times, closer to the end of the period.
which is the average of the l…t† function over the period t .
Obviously, for a -values close to unity the Weibull distribu-
tion is almost exponential and the two failure models are
almost coincident throughout (Fig. 2(a) and (b)); otherwise,
the discrepancy becomes significant (Fig. 3(a) and (b)) and
coincidence of the CDFs occurs only at t ˆ t: In this latter
case, assuming small repair times, the average number of
failures within the period is the same by construction but the
CDFs are quite different and the failures occur at very differ-
ent times: the exponential distribution somewhat favors
5† early failures whereas the Weibull distribution shifts the
Note that the effective failure rate of a component, l p, is
strictly linked to the maintenance period t and this will have
significant effects on the optimization of maintenance with
respect to this parameter, as it will be seen below.
As for what concerns the repair process, we shall adopt
the usual assumption of constant repair rate, m . Although we
realize that the repair process is all but Markovian, this
assumption, which can be easily removed in a Monte

cumulative distribution function probability density functions: weibull vs exponential

1 0.03
weibull: α = 2
0.9 exponential:λ = .0176
0.025
0.8

0.7
0.02
0.6
cdf

cdf

0.5 0.015

0.4
0.01
0.3

0.2
0.005
0.1 weibull: α = 2
exponential:λ = .0176
0 0
0 20 40 60 80 100 0 20 40 60 80 100
time (h) time (h)

(a) (b)

Fig. 3. (a) Cumulative distributions: weibull (a ˆ 2, b ˆ 0.021) vs exponential (l ˆ 0.0176). (b) Probability density functions: weibull (a ˆ 2, b ˆ 0.021) vs
exponential (l ˆ 0.0176).
64 E. Borgonovo et al. / Reliability Engineering and System Safety 67 (2000) 61–73

λ deteriorating and the component emerges with a failure rate

increased by a given percentage p of its value before the
failure. The analyst-defined parameter p then specifies the
amount of deterioration induced by the failure-repair
process.

τ 2.2. Maintenance
t It is well recognized that maintenance is a central theme
Fig. 4. Linear growth of failure rate within the maintenance period t and
counterbalancing effect of maintenance.
Carlo approach, will allow us to compare the analytical
results with those obtained by the Monte Carlo simulation.
Moreover, since the asymptotic system availability of a
repairable component depends on the average repair time,
the approximation of constant repair rate is significant only
during the transient evolution [13].
Even with maintenance counterbalancing its effects,
some aging of the components is inevitable. Given that
we are going to use equivalent constant transition rates,
we account for an effect of component deterioration due
to extensive operation through the outcome of the repair
process. More specifically, we assume that as a result of a
repair action the component might not necessarily return to
an “as good as new” condition since it is likely to become
more fragile and prone to future failures. To account for
imperfect, deteriorating repairs, we adopt a modified
Brown–Proschan model of stochastic repairs which postu-
lates that a system is repaired to an “as good as before”
condition (minimal repair) only with a certain probability
p and is, otherwise, returned in a “deteriorated” condition
(deteriorating repair) [14,15]. Thus, these two conditions
obey a Bernoulli distribution. Inclusion of this model within
the Monte Carlo simulation scheme is straightforward.
When a repair action is completed, we sample a uniform
random number r in ‰0; 1Š: if r , p; then the repair is mini-
mal and the failure properties of the component are returned
to the conditions existing prior to failure; otherwise, repair is
of plant management: indeed, an efficient maintenance
policy may ensure safe, reliable and economic operation.
On the contrary, an inefficient scheduling and choice of
maintenance actions guarantees at least a waste of
resources.
Various maintenance criteria have been followed to fulfill
the large variety of requirements and constraints of the
industrial world. More recently, the criterion of RCM has
been supported as a unifying concept in maintenance prac-
tice [3]. It is essentially a qualitative approach aiming at
developing a maintenance scheme which satisfies both the
reliability and the economic constraints of plant manage-
ment and operation. The main goal of RCM is that of iden-
tifying those maintenance activities which guarantee a
certain level of system reliability: however, in the case of
limited resources, as is always the case in practice, a
compromise is sought between the number, frequency and
the type of intervention and the operation and management
costs of the plant. It is then clear how relevant it is to study
efficient maintenance strategies and how important it is to
develop appropriate models that render the analysis quanti-
tative.
The model here proposed is based on the following
assumptions: (i) maintenance occurs only while the system
is available; (ii) maintenance periodicity varies with the
component’s aging due to imperfect, deteriorating repair;
(iii) the maintenance action is such to restore the conditions
existing at the beginning of the previous maintenance period
(Fig. 4); and (iv) the maintenance action is instantaneous.
In realistic situations, the maintenance activities become
more and more frequent as the component ages. In our

λ*(t)

τ’ τ’
Trip

τ τ

Fig. 5. Adaptive maintenance period for an aging component. After component failure and repair (with time Trep) the component ages according to the Brown–
Proshan model and the maintenance period is shortened from t to t 0 .
 E. Borgonovo et al. / Reliability Engineering and System Safety 67 (2000) 61–73
model, effectively, deterioration of a component is due to
the imperfect repairs, as for the Brown–Proschan model
previously introduced, and we allow for an adaptive sche-
dule of maintenance intervention according to which the
ratio between the maintenance period t and the mean time
1=l between successive failures is kept constant. Thus, after
a minimal repair lnew ˆ lold and, then, tnew ˆ told ; vice
versa, after a deteriorating repair, lnew ˆ …1 1 p†lold and,
then, tnew ˆ told lold =lnew ˆ told =…1 1 p†: Fig. 5 shows the
situation for a ˆ 2 and p ˆ 1:
2.3. The profit function
Plant management is inevitably affected by economic
constraints. In order to quantify the consequences of a
given management action in economic terms it is common
practice to introduce a profit (cost) or energy function E
which contains all the relevant factors affecting the plant
operation and management from an economic point of view
[16–18]. Given a set of alternative management strategies,
the choice will fall on the one which gives the largest value
of E.
In general, neglecting any financial interest, we can write
the profit function as follows:
ZTMISS
E…TMISS † ˆ ‰B…t† 2 C…t†Š dt …
0 during each trial by collecting the time intervals of the
where the first term denotes the benefits obtained from plant
operation; the second term denotes the global plant manage-
ment and operation costs.
As defined, the profit function E gives the total benefit
received from a given plant management and the operation
strategy in a period TMISS. Often in practice, the mean net
hourly benefit, namely E divided by the mission time TMISS,
is taken as an indicator of management performance.
Often an additional term containing the risk of plant acci-
dents and the costs of consequences to the external environ-
ment is considered. However, here this term is neglected as
we assume that the optimization with respect to the safety
aspects of plant operation have already been accounted for
in the design (in particular with the choice of the system
configuration, redundancy allocation, components reliabil-
ity, etc.) and we focus on the optimization of the period of
components maintenance.
We assume that the net hourly profit from plant operation
is proportional to the plant availability A…t; t…t††; i.e.
B…t; t…t†† ˆ B0 A…t; t…t††; in which we have made explicit
the dependence from the vector of the maintenance periods
t…t† ˆ ‰t1 …t†; t2 …t†; t3 …t†…Š of the various components. The
elements of t…t† serve as a control parameter in the maxi-
mization of the energy function. We remind that the t js are
stepwise dependent on t as explained in Section 2.2 (see Fig.
5). To keep this notation from becoming too unwieldy, in
the following we shall drop the time dependence. We intro-
duce the cost CMj of a single maintenance action on compo-
nent j, and the hourly cost CRj of its repair. Finally, we
65
denote by knj l the average number of repairs underwent
by the jth component over the whole mission time TMISS.
The energy function can then be written as follows:
ZTMISS X 1
E…TMISS ; t† ˆ ‰B0 A…t; t† 2 CMj A…t; t†Š dt
0 j
tj
X 1
2 CRj kn l …7a†
j
mj j
or
E…TMISS ; t† ˆ E0 2 …EU 1 EM 1 ER † …7b†
where:
E0 ˆ B0 TRMISS is a constant term, independent of t;
EU ˆ B0 T0 MISS U…t; t† dt is the cost of downtime, U…t; t†
being the
P plantRinstantaneous unavailability;
EM ˆ j CMj T0 MISS …1=tj †‰1 2 U…t; t†Š dt represents the
maintenance costs; in particular, the integral represents
the mean number of maintenance actions for component j
duringPTMISS;
ER ˆ j CRj …1=mj †knj l is the repair cost.
The three terms composing the integral of the energy
function E in Eq. (7a) are directly computed during the
Monte Carlo simulation. The plant profit is accumulated
6†
available plant operation and multiplying them by the
assumed constant hourly base profit B0. The maintenance
cost in a single trial is obtained by computing the number of
maintenance actions undertaken during the mission time for
each component j, multiplying it by the cost of each main-
tenance action CMj, and summing over all components.
Finally the repair expenditures in a single trial are
computed as follows: when failure of the jth component is
sampled, the repair clock is started to measure the time
interval required for the completion of the repair process;
the clock then stops when the sampled transition is the
repair of that component: at this point, the time spent to
repair the component is known and we multiply it by the
hourly cost CRj to obtain the cost of that repair action. By
collecting all the contributions from all repairs of all compo-
nents occurred in the trial, we get the total cost due to repairs
for that trial.
At the end of the simulation, the collected profits and
maintenance and repair costs are averaged over the number
of trials so as to provide us with an estimate of the profit,
maintenance and repair costs (first, second and third term of
Eq. (7a), respectively); division by the mission time gives
the corresponding hourly rates.
2.4. Obsolescence
The problem of obsolescence is becoming more and more
important in the management of modern plants [19]. Obso-
lescence is defined as the loss in value of a component,
system or plant, due not to its conditions or past operation
66 E. Borgonovo et al. / Reliability Engineering and System Safety 67 (2000) 61–73
history but to a change in the external scenario of techno-
logical evolution and marketing [20]. The overcoming of a
given technology due to technical, legislative and/or
marketing reasons typically leads to a decrease in value of
the system which is not necessarily related to its past or
current performance but can certainly influence its future
life. Indeed, the availability on the market of improved
components offers the enviable opportunity to plant
managers of upgrading their system performance while
rejuvenating the system itself.
In this section, we formalize the issue of obsolescence in
a quantifiable manner and see how resource constraints play
a fundamental role in the management of this problem.
Qualitatively, we can say that as the system components
age, the overall management costs increase mainly due to
downtime costs; at the same time, new, improved compo-
nents become available on the market and this further
reduces the current plant value; the substitution of an old
component with a new, improved one does increase the
system performance but at a cost of purchase. The problem
posed by the obsolescence issue is, then, that of deciding
whether to continue operation with the current plant status
or renovate it, partially or totally. To account for the various
issues at stake, we postulate that as calendar time goes by
new components are available on the market and they are
characterized by a failure rate which decreases exponen-
tially. If we buy a component at time t0, components of
the same kind appear in the market at later times and they
have better l ’s according to the expression:
lji!l …t† ˆ lji!l …t0 † e2s …t2t0 †
j
t $ t0 …
where s j is the rate of decrease in the failure rate of the
newly produced components and lji!l …t0 † is the failure rate
of the component purchased at t0.
Typically the decision of replacing the nominal jth
component with a new, improved one is faced at the time
of failure, so that the alternatives are: repair, at an average
cost CRj × 1=mj (where CRj is the hourly cost of repair of the
jth component and the second factor represents the nominal
average time for repair completion), or renovation by
purchasing a new component jNEW that has become available
in the market at time t, CNjNEW …t†: This cost depends on
many factors related to the patterns of evolution of both the
related technology and market. Since a detailed modeling of
these factors is beyond the scope of this paper, we simplified
the issue by considering the purchase cost constant over
time.
An additional factor in the decision is the residual value
VRj …t 2 t0 † of the jth component, if repaired. In this regard,
we assume that it decreases continuously from the time of
purchase t0 according to an exponential law with parameter
u j.
Finally, the decision of replacing a component with a
newly available one depends also on how the increased
benefits and reduced costs associated to the operation and
maintenance of the renovated system, from now on,
compare with those that would be obtained with the old
system, without renovation. The profit functions E…t !
TMISS ; tujNEW † and E…t 1 1=mj ; t ! TMISS uj† will serve as
measures of the benefits and costs in the renovated and
old system configuration, respectively. Note that the reno-
vation process is considered instantaneous whereas the aver-
age repair time 1=mj of the failed component is accounted for
explicitly.
We now have all the ingredients to make a decision on
how to proceed when the jth component fails: we will
proceed to, renovation, instead of repair, if:
E…t ! TMISS ; tujNEW † 1 CNjNEW …t†
!
1 1
#E t1 ! TMISS ; tuj 1 CRj 1 VRj …t†: …9†
mj mj
The two sides of the inequality represent the total profit of
running the system for the remaining portion of the mission
time with the new or the old (repaired) component, respec-
tively.
A highly complicated issue is the evaluation of the profits
E…t ! TMISS ; tujNEW † and E…t 1 1=mj ! TMISS ; tuj†: The
complication lies in the fact that, from the current system
status as resulting from the past failure–repair–aging
history, one should consider all possible future evolutions,
thus facing the combinatorial explosion of possible scenar-
ios. In our Monte Carlo approach this problem is drastically
approximated by following system evolutions in which only
one component can be renovated during TMISS. For what
8† concerns E…t ! TMISS ; tujNEW †; before starting the Monte
Carlo simulation we establish a suitable sequence of times
Ti, i ˆ 1; 2; …N0 : For each component we, then, pre-
compute N0 batches of 1000 Monte Carlo trials to evaluate
the value of E 0 …Ti ! TMISS ; tujNEW †; i ˆ 1; 2; …N0 ; which
represents the profit of operating the system with the reno-
vated component from the time Ti to the end of the mission
time. For the evaluation of E…t 1 1=mj ! TMISS ; tuj†; before
starting the Monte Carlo simulation we pre-compute one
batch of 1000 trials with no renovations. When during the
actual simulation the jth component fails at time t, we inter-
polate between the adjacent Tip values to determine E…t !
TMISS ; tujNEW † and retrieve the pre-computed value of E…t 1
1=mj ! TMISS ; tuj†; then, we insert these quantities in the
inequality (9) to decide whether to actually substitute or
not the failed component.
The above approximations seem reasonable since, in
general, we do not expect the important components of
the system to be renovated frequently within TMISS.
3. The reference system
For the application of the proposed methodology we
considered a gas compression system, taken from literature
[16], comprising an active and a standby compressor which
 E. Borgonovo et al. / Reliability Engineering and System Safety 67 (2000) 61–73
Fig. 6. System unavailability. W, analytic with no aging; 1 , Monte Carlo
with no aging; p , Monte Carlo with aging …p ˆ 0:8; p ˆ 0:3; t ˆ 20 h†:
will be denoted as components C1 and C2, respectively.
Each component can only be in two states: good (g) or failed
(f). For component C1, a failure cause due to mechanical
wear of the lube oil pump has been identified as worth the
effort of a periodic maintenance task, consisting in lube oil
replacement every t hours. Furthermore, such component
can undergo repair with a given rate, m1f!g : For component
C2, the good state is further specified into active (a) or cold
standby (s) mode (i.e. it can only fail once put into service).
In nominal configuration, the system operates with C1 in the
good state and C2 in cold standby. For simplicity, we
assume that the compressor system configuration corre-
sponding to both compressors being failed is an absorbing
one.
Due to the methodological nature of the present work, in
all the numerical applications which follow our attention is
devoted to the effects that the various model assumptions
have on the overall results and not on the significance of the
actual results which may sometimes be unrealistic.
Given the relative simplicity of the system, in the absence
of aging and obsolescence phenomena, its availability can
be computed analytically by solving the related Markov
chains [16]: the results obtained for this case have served
us for partially testing the Monte Carlo simulation model
developed.
In this regard, few words of mention are deserved for
what concerns the Monte Carlo treatment of the active-to-
standby …a ! s† and standby-to-active …s ! a† transitions.
In the present work, these transitions are simulated by estab-
lishing a proper correlation between the system states before
Table 1
Transition rates
Component j lig!f (h 21) mjf!g (h 21)
1 4:14 × 1024 1
2 0.1 0
67
and after the transition, following the multiplicative correla-
tion model proposed in Ref. [21] and briefly described here.
This model allows one to modify the transition rates by
multiplying the original values times a pre-defined multi-
plication factor which depends on the current and arrival
configurations. More precisely, in our case, the rates of
the transitions a ! s and s ! a for component C2 are
chosen several orders of magnitude smaller than the other
ones so that these transitions are essentially inhibited with
the system in nominal configuration. However, when the
active component C1 fails, a correlation is activated
which forces the standby component C2 to perform the
transition s ! a: To do this, the correlation is such to multi-
ply the transition rate l2s!a by a very large factor which
renders it now several orders of magnitude larger than the
rates of the other transitions (repair of C1, failure of C2).
Then, the next stochastic transition is basically instanta-
neous and certain to bring the standby component C2 to
the active operation mode. Analogously, we proceed to
return component C2 to the standby mode when the failed
active component C1 is brought back to operation after
repair. Moreover, the assumption that the system configura-
tion for which both components are failed is an absorbing
one is here implemented by introducing yet another correla-
tion to basically inhibit the repair transition of C1 (recall
that in the model this is the only component to undergo
repair) when the current system configuration is that of
both components being failed.
These applications of the correlation model proposed in
Ref. [21] confirm the great flexibility that such model intro-
duces, handling, in particular, various kinds of dependencies
as well as deterministic, operation-mode transitions.
Fig. 6 reports the comparison of the analytical (circles)
and Monte Carlo (crosses) unavailability solutions for the
reference system with no aging. The components’ failure
and repair rates are reported in Table 1. The input data for
the cost evaluation of the reference system are given in
Table 2. Furthermore, recall that component C2 is in cold
standby, so that l2g!f …h21 † ˆ 0; while the deterministic
transitions from standby to active and vice versa are treated
through the correlation model just explained. The mission
time was taken as 4000 h; the number of trials in this and all
following Monte Carlo simulations is 10 5, unless otherwise
specified. The good agreement of the two solutions is
evident.
The starred-curve in Fig. 6 refers to the case with aging
after repair …p ˆ 0:8 and p ˆ 0:3 in the Brown–Proschan
model) and a periodic maintenance with t ˆ 20 h: The
aging process is shown to worsen significantly the availabil-
ity performance of the system, as expected. Only the Monte
Carlo solution is computed in this case, the analytic
approach becoming rather cumbersome.
For what concerns the energy function E of Eqs. (7a) and
(7b), since we will eventually be interested in optimizing the
maintenance strategy with respect to the period t and since
E0 is a constant term, independent of t , in what follows we
68 E. Borgonovo et al. / Reliability Engineering and System Safety 67 (2000) 61–73
Table 2
Input data for the cost evaluation of the reference system
CU ($/h) CR1 ($/h) a CM1 ($) a t (h)
100 5 10 24
a
Maintenance and repair actions are performed only on the active
component C1.
shall directly consider the costs E 0 ˆ E0 2 E ˆ EU 1 EM 1
ER ; so that the maximization of E corresponds to a mini-
mization of the overall costs E 0 . Fig. 7 reports the time
behavior of the hourly costs EM =t; EU =t; ER =t and E 0 =t result-
ing from the Monte Carlo simulation in the case of no
Brown–Proschan aging.
The decreasing behavior of EM =t (Fig. 7(a)) is a conse-
quence of the fact that maintenance is performed only when
the system is available: as times goes by, the system
becomes less and less available (Fig. 6) and, correspond-
ingly, the maintenance actions are reduced. On the contrary,
as expected from the definition, the downtime cost EU =t
increases proportionally to the system unavailability (Fig.
7(b)). Finally, also the repair cost ER =t shows a decreasing
behavior (Fig. 7(c)): this is due to the assumption of the
absorbing state when both components are down so that
the number of repairs are also reduced as the system
Fig. 7. System cost: (a) maintenance; (b) downtime; (c) repair; (d) total.
becomes more and more unavailable. The combination of
these three contributions gives rise to the global cost beha-
vior E 0 =t of Fig. 7(d) where the dominance of the downtime
term becomes evident.
Let us now see what happens to the system costs when the
Brown–Proschan aging-after-repair effects are included (as
before, p ˆ 0:8 and p ˆ 0:3). Recall that besides worsening
the availability performance of the system, the effect of
aging will also be that of shortening the maintenance period
t (so as to maintain the product lp t) constant. This increase
in the maintenance frequency inevitably makes the asso-
ciated costs to increase. In order to highlight the effects of
maintenance costs, we have taken the previous case but for
the hourly downtime cost CU which has been (somewhat
unrealistically) set equal to just $1/h. Fig. 8 reports the
hourly and integral behavior of the cost curves, as computed
by the Monte Carlo simulation. One immediately sees that
the contribution due to maintenance has a maximum
(circles). At the beginning, aging degrades the system
performance by increasing the transition failure rates of
the system components. As just explained, this induces
more frequent maintenance actions which make the hourly
costs increase. However, as the system availability
decreases, the downtime increases: since during downtime
no maintenance actions are undertaken, in the long run as
unavailability increases the maintenance costs decrease.
 E. Borgonovo et al. / Reliability Engineering and System Safety 67 (2000) 61–73
Fig. 8. (a) Instantaneous and (b) integral behavior of the costs as a function of time, in case of Brown–Proshan aging after repair …p ˆ 0:8; p ˆ 0:3; t ˆ
20 h†:
Note also how, in this unrealistic case, the chosen cost
values are such that maintenance expenditures become
predominant at most times, when maintenance actions are
made very frequent so as to overcome the running aging
process.
The repair costs also show a similar, peaked behavior
(crosses). Indeed, aging at the beginning worsens the beha-
vior of the components, thus inducing also more frequent
repairs. However, since the system failure (both components
C1 and C2 down) constitutes an absorbing configuration, as
time goes by the system is more and more in this state of
unavailability where repairs are not performed. Finally, the
value E 0 …TMISS ; t† of the cumulated global costs at TMISS in
Fig. 8(b) can be considered as the total amount of expenses
needed to operate the system up to that time. This shall be
compared with the gained benefits from plant operation.
4. Maintenance optimization
The problem of choosing maintenance strategies is of
foremost importance in plant management and operation.
An efficient strategy should aim at guaranteeing the level
of performance and availability of the system while allow-
ing for a reduction in the resource expenditures.
The Monte Carlo scheme proposed here allows for a
quantitative analysis of the maintenance strategies. The
definition of an appropriate system energy model, such as
the one proposed in the previous section, enables one to
perform a search of the optimal strategy in terms of a maxi-
mization of the energy function E (Eqs. (7a) and (7b)),
which corresponds to a minimization of E 0 ˆ EU 1 EM 1
ER : In this section the search of the optimal maintenance
period t p for the reference system presented in Section 3 is
performed within the Monte Carlo simulation framework.
As mentioned in Section 2.2, to describe the failure beha-
vior of the system components instead of considering a
Weibull distribution, we introduce an equivalent exponen-
tial distribution such that the probability of a failure at any
time within an interval between maintenance actions is the
same. By doing so, we are able to establish a connection
69
between the failure rate of a component and the mainte-
nance period t (Eq. (5)) which forms the basis for the
present optimization of the maintenance period. This
implies that the optimization regards only the starting main-
tenance period referring to ‘as new’ components; this initial
maintenance period is then modified during the compo-
nents’ life so as to counteract the Brown–Proschan degra-
dation of the corresponding failure rates, as explained in
Section 2.2. Indeed, Eq. (5) implies that the smaller is t
the smaller the components’ failure rates are, so that the
system is more available and produces more benefits; on
the other hand, there will be more maintenance actions
and this will increase the associated costs. Therefore, if
we look at the contributions of the cost function E 0 in
Eqs. (7a) and (7b), we expect that as t decreases: the down-
time cost EU decreases, as does the contribution due to
repairs, ER, since the probability of failure decreases; the
maintenance term EM, on the contrary, increases. The opti-
mal choice of t will then represent a compromise for the
behaviors of the various contributions. Obviously, if t p
turns out to be very small, this means that the system design
and/or components’ choice were poor; moreover, the
assumption of instantaneous maintenance should be re-
visited. In the opposite case, a very large t p would imply
a very good system design and/or components characteris-
tics; this would bring in issues of capital costs/interests and
their relation to the goodness of the components which have
not been here considered, for simplicity.
While an analytical search for the optimal t -value is
exceedingly complicate, the Monte Carlo approach is rather
straightforward. We, a priori, define a range for t within
which the search is to be performed. From this range, we
select a number of values t i, i ˆ 1; 2; …; NM ; and for each
value we perform a batch-Monte Carlo evaluation of the
cost function E 0 …t; ti †: The choice of the optimal period
will then fall on that value t p which minimizes the cumu-
lative cost E 0 …t; tp † at t ˆ TMISS : This approach was applied
to the reference system for values of t i in the range ‰2; 38Š
(in hours) and with a value of b (Eq. (5)) such that the
failure rate of component C1 (which is the only one to
be maintained and repaired) is equal to 9 × 1024 h21 in
70 E. Borgonovo et al. / Reliability Engineering and System Safety 67 (2000) 61–73

Fig. 9. System costs as a function of the maintenance period t : (a) maintenance; (b) downtime; (c) repair; (d) total.

correspondence of the mean value t ˆ 20 h: It turns out that
b ˆ 0:021: The number of Monte Carlo trials per batch was
chosen equal to 10 000.
We first consider the simple case with no aging and obso-
lescence, for which the analytical solution to the energy
function can be obtained [16]. Fig. 9 shows the good agree-
ment between the analytical and Monte Carlo results for the
hourly cumulative costs due to downtime, maintenance and
repair, as well as for the global hourly cost
E 0 …TMISS uti †=t …$=h†; for various values of t i: the optimal
choice for the period t p turns out to be 9.2 h.
As expected, Fig. 9(a)–(d) shows that for small values of
t i, the costs due to highly frequent maintenance actions are
such to increase considerably the global costs; as the value

Fig. 10. System costs as a function of the maintenance period t in presence of aging …p ˆ 0:8; p ˆ 0:3†:
 E. Borgonovo et al. / Reliability Engineering and System Safety 67 (2000) 61–73 71

Fig. 11. System cumulative benefits and total costs as a function of time: (a) non-optimized t ˆ 20 h; (b) optimized tp ˆ 5:6 h:

of t i is increased, the maintenance costs decrease but down-
time, and its associated costs, slowly increase: the conflict-
ing trends of these contributions give rise to a minimum of
the global cost function; finally, for very low maintenance
frequencies the system availability deteriorates significantly
and the dominating contribution of the downtime costs gives
rise to very large global cost values.
Let us now see what happens when aging is considered.
Fig. 10 reports the Monte Carlo simulation results for the
case of Brown–Proschan aging with p ˆ 0:8 and p ˆ 0:3:
The optimal maintenance period reduces to tp ˆ 5:6 h : this
is due to the fact that aging worsens the availability of the
system so that the contribution of the downtime costs is felt
at earlier times. The importance of the choice of the main-
tenance period can also be seen from the point of view of the
cost-benefit analysis of plant operation. Fig. 11 shows the
cumulative benefits and total costs, in dollars, as a function
of time for the aging system with (a) non-optimized period
t ˆ 20 h and (b) optimized period tp ˆ 5:6 h. In the first
case, the plant turns out to be making a net profit only for the
first 2300 h, after which the downtime costs are such to
dominate (Fig. 11(a)). On the contrary, the optimized main-
tenance period is such to render profitable the operation of
the plant throughout the mission time (Fig. 11(b)).
Finally, we investigate the effects of obsolescence on the
reference system of Section 3 with the data of Table 3, N0 ˆ
3 and maintenance period t ˆ 20 h:
Fig. 12 reports the results of the system unavailability for
the cases of no aging (stars), aging (crosses) and aging plus
obsolescence (circles). The effect of obsolescence is seen to
improve significantly the availability performance of the
system as it counteracts the aging of the components.
Fig. 13 compares the effects of obsolescence on the
cumulated total costs E 0 . Obviously, the results strongly
depend on the input data: as shown in the figure, the operat-
ing costs of the system are significantly lowered in the case
of renovation of component C1 at a price CN1 equal to $5
(a); the advantages of renovation are completely defeated
when the cost of a new component C1 is raised from $5 to
$100 (b).
5. Conclusions
The operation and management of a plant requires proper
accounting for the constraints coming from safety and relia-
bility requirements as well as from budget and resource
considerations. The analyses that need to be performed in
order to evaluate the maintenance strategies and operating
procedures need to consider many practical aspects, such as
aging, repair, obsolescence, renovation, which are almost

Table 3
Data for the obsolescence process

Component j CNj ($) s j (h 21) u j (h 21)

1 5 100 1:2 × 1024 0.05

2 5 0a 0b
a
No improved types of the standby component C2 become available (no
obsolescence).
b
Component C2 does not lose value since it does not undergo obsoles- Fig. 12. System unavailability as a function of time, under no aging/no
cence. obsolescence ( p ); aging/no obsolescence ( 1 ); aging/obsolescence (W).
72 E. Borgonovo et al. / Reliability Engineering and System Safety 67 (2000) 61–73
Fig. 13. Total cumulative costs for the system, with and without obsolescence. (a) CN1, $5; (b) CN1, $100.
impossible to be captured by analytical models. The Monte
Carlo simulation instead provides a flexible tool which
enables to describe efficiently many of the relevant aspects
for plant management and operation.
In this paper, we have presented a Monte Carlo approach
to the availability analysis of complex systems under peri-
odic maintenance strategies and within the economic
constraint of limited resources. The maintenance interven-
tions have the objective of defeating the effects of aging:
these latter have been accounted for by means of a modified
Brown–Proschan model of imperfect, deteriorating repair
which accounts for the increased proneness to failure of a
repaired component. The effects of obsolescence have also
been accounted for by assuming the availability of new
components on the market, characterized by exponentially
decreasing failure rates. The economic constraint has been
formalized in terms of an energy, or cost, function which has
allowed us to optimize the maintenance period and to eval-
uate the convenience of substituting a failed component
with a new, improved one. The proposed approach has
been illustrated with reference to a system taken from litera-
ture. Due to the methodological character of the work, no
particular meaning should be given to the numerical results
obtained. Rather, the choices of the numerical values of the
model parameters have been directed by the intention of
illustrating various model effects.
As a final consideration we note that as the issues of plant
management and operation gain more and more importance,
they will also become more and more complicated so that
the Monte Carlo approach will become the fundamental tool
for such analysis. Further efforts in the field are therefore
needed both from a methodological point of view (such as,
for example, the introduction of efficient variance reduction
techniques for the evaluation of cost and energy integrals)
and from an application point of view.
Currently, the authors have completed a work which
combines Monte Carlo reliability and availability analysis
to the powerful genetic search algorithms for optimization.
The work is in the process of being prepared for submission
to this journal for publication.
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