Building a Total Cost of Ownership model to support manufacturing asset lifecycle management

This paper proposes a methodology to build a Total Cost of Ownership (TCO) model aimed to support decision-making for manufacturing asset lifecycle management. Existing challenges for TCO adoption in industry are identified through literature review and through an explorative multiple case study involving eight manufacturing companies. Based on it, a general methodology is proposed for building a novel asset-centric performance-driven TCO model. The methodology is based on an integrated modelling approach that puts together technical performance analysis and economic analysis, enabling the asset users linking their knowledge about asset performance with offers specifications by the asset providers. In this way, the TCO model becomes a decision-making tool for the asset users that can also guide the relationship with providers. An application case within a chemical production company is described, showing how challenges are addressed through the proposed methodology, within a real context.