Impact of reliability on warranty: A study of application in a large size company of electronics industry

Abstract This paper presents product reliability on component basis and investigates the possible effects on warranty which constitutes a non-technical issue. Product reliability is a key factor, which is used in considering the warranty period. It plays a significant role that a mistake in warranty forecasting could cost a lot for companies. The objective is to empirically examine the nature of general reliability of manufactured goods and conduct a case study in an electronics company. In this regard, reliability will be stated from the actual manufacturing point of view. A case study was applied in manufacturing industry. LCD TVs were undertaken to follow. To test reliability, a parametric Weibull model was used and hazard rates of products were estimated with linear regression method. For this research work, the lifetime data obtained by service departments, censored both left and right. Data were used in MINITAB14 to produce the reliability results of the LCDs to reveal the relationship between product reliability and product warranty in the consumer electronics industry. In this manner, this paper would help the company to decide whether it is favorable to extend the warranty period based on the failure findings.