Bayesian Modelling for Product Testing and Release

Deciding when to release a new product requires a tradeoff between costs, potential profits and the underlying reliability of a product. Many new products go through a “Test Analyze and Fix” process. When a failure occurs, an immediate design “fix” may occur or the product might undergo a minimal fix with design changes being delayed until later when many changes can be introduced at the same time. We introduce a Bayesian model that allows for the introduction of managerial knowledge and experience. Unlike most approaches, we do not build in an assumption that the product always improves throughout the process.

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