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Demonstration Disk For MonteCarloSimulations TM

Version1.0k June13, 2007 Copyright 1996-2002byBarringer &Associates, Inc.

Initialize Program
And Go To Table Of <----Pressing this button, or moving to other spreadsheets in this file,
Contents is acceptance of notices show below.

If the error message "Can't
resolve circular reference.."
appears, hit the Escape Key.
This conflict will be removed
when you click on the "Initialize
Program.." button.
Software By:
H. Paul Barringer, P.E.
Barringer & Associates, Inc.
P.O. Box 3985, Humble, TX 77347-3985 USA
Phone: 281-852-6810 FAX: 281-852-3749
e-mail: hpaul@barringer1.com
http://www.barringer1.com

Demonstration Disk For MonteCarloSimulationSTM

(Read this information from the lawyers)
Read this narrative (double click inside this box, cursor down or pull down the lower edge of this
block). Do not delete this sheet, you'll need this information at a later date!

This spreadsheet file is usable with ExcelTM version 5.0 and above. The simulation macros won't
work in lower revisions. Excel is a trademark of Microsoft Corporation. MonteCarloSimulationS is
trademark pending by Barringer & Associates, Inc.

Information in this software file is subject to change without notice for correction of errors and
change of features. Barringer & Associates, Inc. does not represent a commitment to notify users
of any changes. This software is furnished for demonstration purposes only. Copies of this
demonstration software must acknowledge Barringer & Associates, Inc. as the original source of
the code. Copies must also include all narrative boxes with notices and instructions.

Examples in this file are intended for training and education in the use of Monte Carlo simulations.
No warranty of accuracy, applicability, correctness of use, or throuroughness of purpose is stated or
implied for this software. As in the case of all engineering tools, you must exercise good judgment
in the use of these software tools for safe and responsible results using these Monte Carlo
concepts. Use sound engineering and business judgments when studying any simulation even
using probabilitics calculations. A full set of MonteCarloSimulationS for EXCEL 5.0+
spreadsheets are available at a price of US$40.00 (including shipping & handling).

This software shows, with a few simple models, how to study the outcome of engineering and
business problems using random events and engineering characteristics of how things fail. Results
of Monte Carlo simulations are always different for each trial, however, results from many trials will
show an overall direction and trend. No amount of simulations, based on wrong data or wrong
concepts, can produce accurate simulations results even when wrappped in the cloak of "computer
results".

Reduce uncertainties in your results. Study your data carefully which initiates your Monte Carlo
studies. Understand how the data was obtained and what it is saying to you. Project uncertainties
and unknowns in a prudent and wise manner. If your model doesn't produce believable results, try
again until you produce real life results.

Use WinSMITH WeibullTM ($480), WinSMITH VisualTM ($380), MonteCarloSMITHTM ($280)--

DOS, and BiWeibullSMITHTM($380)--DOS, statistical software packages trademarked by Fulton
Findings, to study errors from multiple iterations. These software packages are available for sale
from Barringer & Associates, Inc at the modest prices shown above plus shipping and handling.
Call 281-852-6810 for details.

Formal Liability Statements (scroll down this information

Page 1
for formal statements)

Warranty
EXCEPT AS PROVIDED IN THIS SOFTWARE, BARRINGER & ASSOCIATES, INC. ("SELLER")
 Table Of Contents

Table Of Contents
Click on button to move to the appropriate spreadsheet.
Why Use Monte Carlo Complex Model Using
1--> Simulations 5--> Reliability #s 9-->

Series Model Using Simple Business Failure

2--> Reliability #s 6--> Model Using Weibull
Failure Data

Series Model Using Air Compressor

3--> Age To Failure Info. 7--> Simulation

Parallel Model Using

4--> Reliability #s 8--> More Info

9-- Return To The Banner Page

Table Of Contents
(A quick summary of the models)

Read this narrative (double click inside this box and cursor down, or pull down the lower edge
of this block). Then slide this sheet to one side, I.e., click on the border, hold down the left
mouse key, and drag to one side to uncover the spread sheet.

Do not delete this sheet, you may need some of these details later.

#1--Why Use Monte Carlo Simulations provides background details about models.

#2--Series Model Using Reliability #s shows a very simple case whose results can be
calculated by hand and by Monte Carlo model using only reliability values.

#3--Series Model Using Age To Failure Info shows a simple case of using Weibull
age to failure data to construct a very simple reliability model which uses mission
times to show how reliability values change with mission times.

#4--Parallel Model Using Reliability #s shows a very simple case whose results can
be calculated by hand and by Monte Carlo model using only reliability values.

#5--Complex Model Using Reliability #s shows a series/parallel model whose results

can be calculated by hand using a Boolean Truth Table and by Monte Carlo model
using only reliability values.

#6--Simple Business Failure Model Using Weibull Failure Data uses Weibull failure
data, costs, mission times, etc to calculate availability, reliability and the cost of
unreliability for business failures.

#7--Air Compressor Simulation uses Weibull failure data from a library to calculate
the mean time between failure for the system, maintenance costs, availability, and
reliability for a specified mission interval. This model has a recording macro to record
each age to failure if required.

Page 2
 Series Model--Reliability #s

\ Given: Reliability Values For Each Block Simulation Results

Find: System Reliability In Cell H18 For R1=0.1 & R2=0.2 Block 1 Block 2 Exponential Reliability vs Time
Go To Table Method: Monte Carlo Simulation # Iterat'ns % Error Failure rate =2.30E-04 Failure rate = 1.61E-04 1.2
Of Contents 100 -50.00% t R1 t R2
R1 R2 System 1000 5.00% 0 1 0 1
1
2000 -7.50% 1000 0.7943 1000 0.8513 Mission
Assume R-values Are--> 0.1 0.2 ? Find ? 3000 1.67% 2000 0.6310 2000 0.7248 Time
4000 -11.25% 3000 0.5012 3000 0.6170 0.8

Random number this iteration--> 0.7888 0.8814 5000 12.00% 4000 0.3981 4000 0.5253

Reliability
Success: (Random #) < (R-value) --!! Requires ~20 min. on a DX4/75MHz machine--> 25000 3.50% 5000 0.3162 5000 0.4472 0.6

Success = (1) this iteration--> 0 0 0 6000 0.2512 6000 0.3807

Failure = (0) this iteration--> 1 1 1 Simulation Results 7000 0.1995 7000 0.3241 0.4 Fail
For R1=0.99 & R2=0.95 8000 0.1585 8000 0.2759
Cumulative successes--> #VALUE! #VALUE! #VALUE! # Iterat'ns % Error 9000 0.1259 9000 0.2349 0.2
OK
Cumulative failure--> #VALUE! #VALUE! #VALUE! 100 -0.05% 10000 0.1000 10000 0.2000
Total Iterations--> #VALUE! #VALUE! #VALUE! <-- 1000 -0.05% 11000 0.0794 11000 0.1703 0
2000 0.00% 12000 0.0631 12000 0.1450 1000 3000 5000 7000 9000 11000 13000
Simulated Reliability--> #VALUE! #VALUE! #VALUE! <-- 3000 0.87% 13000 0.0501 13000 0.1234 0 2000 4000 6000 8000 10000 12000 14000

Theoretical Reliability--> 0.1000 0.2000 0.0200 <-- 4000 -0.11% 14000 0.0398 14000 0.1051 Mission Time
5000 -0.60%
% Error--> #VALUE! #VALUE! #VALUE! <-- 25000 -0.09%

Series Model--Reliability #s
(A little bit of simulation information for orientation)

Read this narrative (double click inside this box and cursor down, or pull down the lower edge of this block). Then slide this sheet to one side, I.e., click on the border, hold down
the left mouse key, and drag to one side to uncover the spread sheet.

Do not delete this sheet, you may need some clues later when you build your own models!

This model shows a small series system with elements R1 and R2 (which you can change for your evaluation). In a series system, failure of any item causes the system to fail.
For system success, all elements of the system must be successful simultaneously.

The reliability of this simple series system is easy to find by hand calculation. Multiply the individual reliabilities to compute the system reliability. For example if R1 = 0.9 and R2
= 0.8, then the system reliability Rsystem = 0.72

A small series model gives us a known answer as a datum for our efforts. We can test our simulation against the true answer to measure how well our Monte Carlo simulation
has done in reaching the correct answer.

Use Excel's RAND() feature to produce a random number between 0 and 1 with a uniform chance for an occurrence. This is helpful since reliability numbers also lie between 0
and 1!

Select a value for the reliability of each block as the given value. Then use the criteria for simulation success as (Rsimulated < Rblock ). A simulation failure occurs when (Rsimulated >
Rblock ) for each element. See the graph of reliability versus time in cells Q1:X21 to demonstrate why this criteria is true. In short, if the block survives to a longer time (I.e., it will
display a lower reliability) than for the selected value of reliability for the block--thus success has occurred as (Rsimulated < Rblock ).

Measure system success by calculating reliability as an characteristic (the number of successful attempts)/(the total number of attempts). The total number of attempts is
number of successes plus number of failed attempts. System success occurs when both block are successful simultaneously.

Why chose block reliabilities as a small value for this demonstration? The answer is lies in the range of random numbers available for successes or failures using the criteria of
(Rsimulated < Rblock ). If Rblock = 0.1 then 90% of the numbers chosen from a uniform distribution between 0 and 1 will lie on the failure side of the line (big reliability numbers
indicating short mission time), however, if Rblock = 0.99 then 1% of the numbers chosen randomly will lie on the failure side of the line, I.e., they will be larger than the block value--
refer to the diagram in cells Q1:X21.

Which is better, many moderate size Monte Carlo simulations or a few very long simulations? Generally speaking, you've got to first run enough iterations to get the errors fairly
low which usually means something on the order of say 1000 to say 5000 iterations and then you're better off to run many of these moderate size simulations and study the
results using standard statistical tests to verify the confidence and mean results of your results. For example, run 500 iterations twice and if the results are in close agreement,
accept the answer at 1000 iterations. If the results at 500 are not close, then increase trial size to say 1000 and run two more trials and repeat the "jackknife" procedure until
consistency is obtained (the jackknife technique is symbolized by the shape of an open jackknife, > with 500 and 500 good results giving way to 1000). Expect precision to be ~
1/(N0.5 ) where N is the number of trials.

Along the right hand side of the model, J1:k22, are some typical results obtained by simulation. Notice the difference in the % error for low reliability numbers and for high
reliability numbers--it's easy to get several orders of magnitude difference!

Now pull this information to the side and run the simulation model.

Page 3
 Series Model--Age To Failure

Reset & Iterate Given: Reliability Values For Each Block Simulated Results (for 3000 iterations):
R1=0.1, β=1.0, η=3474.4, t0=0, T=8000 hrs True Reliability Values
Find: System Reliability In Cell H24
1.20
Go To Table Method: Monte Carlo Simulation R2=0.2, β=1.0, η=4970.7, t0=0, T=8000 hrs
Of Contents Sim. Rsystem True Rsystem % Error
Mission Time
R1 R2 System 500 0.7960 0.7831 1.6477 1.00
1000 0.6137 0.6132 0.0695
Data Input: 2000 0.3843 0.3761 2.1990
Mission Time, T, (hours)--> ----------> ----------> 2000 4000 0.1480 0.1414 4.6499 0.80
Weibull Shape Factor, β,--> 3 4 6000 0.0527 0.0532 -0.9735
Weibull Characteristic life, η,--> 3474.4 4970.7 8000 0.0170 0.0200 -15.0031

Reliability
t0 origin shift--> 0 0 10000 0.0073 0.0075 -2.5023 0.60
Calculated reliability: 12000 0.0023 0.0028 -17.5087
Actual R-values for mission--> 0.8263 0.9741 ? Find ? 14000 0.0007 0.0011 -37.3272
Iteration results: See Graph-------->-------------->--------------->-------------->-------------->------------->0.40
Random number this iteration--> 0.8079 0.8144 Simulated Results (for 3000 iterations):
Success: (Random #) < (R-value) --!! R1=0.0000, β=3.0, η=3474.4, t0=0, T=8000 hrs
Success = (1) this iteration--> 1 1 1 R2=0.0012, β=4.0, η=4970.7, t0=0, T=8000 hrs 0.20

Failure = (0) this iteration--> 0 0 0 Mission Time Sim. Rsystem True Rsystem % Error
Summary results: 500 0.9963 0.9969 -0.0590
0.00
Cumulative successes--> #VALUE! #VALUE! #VALUE! 1000 0.9733 0.9748 -0.1546 500 1000 2000 4000 6000 8000 10000 12000 14000
Cumulative failure--> #VALUE! #VALUE! #VALUE! 2000 0.8017 0.8050 -0.4101
Mission Time (hours)
Total Iterations--> #VALUE! #VALUE! #VALUE! 4000 0.1453 0.1429 1.6707
6000 0.0013 0.0007 92.1174 Note how both curves go through the system characteristic life
Simulated Reliability--> #VALUE! #VALUE! #VALUE! <-- 8000 0.0000 0.0000 -100.0000 as the value is determined by eta and not by beta.
Theoretical Reliability--> 0.8263 0.9741 0.8050 <-- 10000 0.0000 0.0000 -100.0000
12000 0.0000 0.0000 -100.0000
% Error--> #VALUE! #VALUE! #VALUE! <-- 14000 0.0000 0.0000 -100.0000

Series Model--Age To Failure Using Weibull Equations

(A little bit of simulation information for orientation)

Read this narrative (double click inside this box and cursor down, or pull down the lower edge of this block). Then slide this sheet to one side, I.e., click on the
border, hold down the left mouse key, and drag to one side to uncover the spread sheet.

Do not delete this sheet, you may need some clues later when you build your own models!

This model shows a small series system with elements R1 and R2 (which you can change for your evaluation). In a series system, failure of any item causes
the system to fail. For system success, all elements of the system must be successful simultaneously. The values for R1 and R2 are obtained from the Weibull
equation and a specified mission time. When you see a reliability value, always ask: "For the reliability values specified, what is the mission time?" For the
exponential distribution, β = 1 for the Weibull equation which explains a chance failure mode for individual components.

The reliability of this simple series system is easy to find. Multiply the individual reliabilities to compute the system reliability. For example if R1 = 0.9 and R2 =
0.8, then the system reliability Rsystem = 0.72 Note how the mission time can be changed to give different values for the reliability. The Weibull reliability
equation is R(t) = exp(-((t-t0)/η )^(β )) where t is the mission time. Note on the graph how the reliabilities change with mission time given a specific value for the
Weibull shape factor, β , and the Weibull characteristic life, η . The simulation is run for two conditions of beta while eta is held constant and t0 is set to zero.

A small series model gives us a known answer as a datum for our efforts. We can test our simulation against the true answer to measure how well our Monte
Carlo simulation has done in reaching the correct answer.

We'll use Excel's RAND() feature which will produce a random number between 0 and 1 with a uniform chance for an occurrence. This is helpful since reliability
numbers also lie between 0 and 1!

For more information on the criteria for success/failure, see the Series Model--Reliability #s

Along the right hand side of the model you will find some typical results obtained by simulation. Notice the difference in the % error for low reliability numbers
and for high reliability numbers--it's easy to get several orders of magnitude difference!

Now pull this information to the side and run the simulation model.

Page 4
 Parallel Model--Reliability #s

Given: Reliability Values For Each Block Simulation Results

Find: System Reliability In Cell H20 For R1=0.1 & R2=0.2
Go To Table Method: Monte Carlo Simulation # Iterat'ns % Error
Of Contents 100 -21.43%
R1 1000 -1.79%
Parallel Model 2000 1.79%
R2 3000 2.86%
4000 -2.86%
Assume R-values Are--> 0.1 0.2 ? Find ? 5000 3.00%
25000 -1.06%
Random number this iteration--> 0.2273 0.6502
Success: (Random #) < (R-value)---!! Simulation Results
Success = (1) this iteration--> 0 0 0 For R1=0.99 & R2=0.9
Failure = (0) this iteration--> 1 1 1 # Iterat'ns % Error
100 0.10%
Cumulative successes--> #VALUE! #VALUE! #VALUE! 1000 -0.20%
Cumulative failure--> #VALUE! #VALUE! #VALUE! 2000 0.05%
Total Iterations--> #VALUE! #VALUE! #VALUE! 3000 0.00%
4000 0.00%
Simulated Reliability--> #VALUE! #VALUE! #VALUE! <-- 5000 0.02%
Theoretical Reliability--> 0.1000 0.2000 0.2800 <-- 25000 -0.02%

% Error--> #VALUE! #VALUE! #VALUE! <--

Parallel Model--Reliability #s
(A little bit of simulation information for orientation)

Read this narrative (double click inside this box and cursor down or pull down the lower edge of this
block). Then slide this sheet to one side, I.e., click on the border, hold down the left mouse key, and
drag to one side to uncover the spread sheet.

Do not delete this sheet, you may need some clues later when you build your own models!

This model shows a small parallel system with elements R1 and R2 (which you can change for your
evaluation). In a parallel system each element must be capable of carrying the full load (or else you
have a m-out-of-n model as occurs with large power transformers and large cooling tower pumps).
The system survives if any one element survives and fails if both elements fail simultaneously.
Remember, for system success, only one element must survive to achieve system survival.

The reliability of this parallel system is easy to find. Multiply the individual unreliabilities (Unreliability
= 1- Reliability) and subtract from one to compute the system reliability. For example if R1 = 0.9 and
R2 = 0.8, then the system reliability Rsystem = 1-(1-0.9)*(1-0.8) = 0.98

A small parallel model gives us a known answer as a datum for our efforts. We can test our simulation
against the true answer to measure how well our Monte Carlo simulation has done in reaching the
correct answer.

For more details on the criteria for success/failure see the Series Model--Reliability #s

Along the right hand side of the model you will find some typical results obtained by simulation.

Now pull this information to the side and run the simulation model.

Page 5
 Complex Model--Reliability #s

Given: Reliability Values For Each Block Simulation Results

Reset & Iterate Find: System Reliability In Cell I25 For R1=0.1, R2=0.3,
Method: Monte Carlo Simulation With Boolian Truth Tables R3=0.1, R4=0.2, &
Go To Table R5=0.2
Of Contents # Iterations % Error
R1 R4 100 17.89%
1000 -4.95%
R2 ? 2000 18.63%
3000 3.15%
R3 R5 4000 -1.45%
5000 0.35%
25000 -0.73%
R1 R2 R3 R4 R5 SYSTEM
Change R-values To--> 0.1 0.3 0.1 0.2 0.2 ? Find ?
Simulation Results
Random number this iteration--> 0.7306 0.4040 0.4453 0.4225 0.6743 For R1=0.9, R2=0.95,
Success: (Random #) < (R-value) R3=0.97, R4=0.98, &
Success = (1) this iteration--> 0 0 0 0 0 0 R5=0.99
Failure = (0) this iteration--> 1 1 1 1 1 1 # Iterations % Error
100 0.04%
Cumulative successes--> #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! 1000 0.04%
Cumulative failure--> #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! 2000 -0.01%
Total Iterations--> #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! 3000 -0.02%
4000 0.02%
Simulated Reliability--> #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! 5000 -0.04%
Theoretical Reliability--> 0.1000 0.3000 0.1000 0.2000 0.2000 0.1357 25000 -0.01%

% Error--> #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE!

<--Clicak on this button to hide or unfold the spreadsheet and show the Boolian Truth Table.
Complex Model--Reliability #s
(A little bit of simulation information for orientation)

Read this narrative (double click inside this box and cursor down or pull down the lower edge of this
block). Then slide this sheet to one side, I.e., click on the border, hold down the left mouse key, and drag
to one side to uncover the spread sheet.

Do not delete this sheet, you may need some clues later when you build your own models!

This model shows a small, series-parallel system with elements R1 through R5 (which you can change
for your evaluation). In this complex system, redundancy exists to prevent failuresystem. For system
success, some (not all) elements of the system must be successful simultaneously and the criteria for
success can be choosen by inspection of the combinations for the specific case to include in the logic
statement.

The reliability of this complex series system is not easy to find. We must use a complicated method of
calculating the system reliabiilty by resorting to a Boolian Truth Table to calculate the overall system
reliability. The size of the table will be large. The table will consist of 2n elements or 25 =32 rows of data
using 5 columns of elements for the reliabilities. Remember, we're trying to calculate the theoretical
reliability for the system based on the individual reliability values and that's the reason the Boolian Truth
Table is used for this case. Suggestion: avoid Boolian Truth Tables whenever possible--mathematicians
love them but engineers will love to hate them!!!

On the first pass through the Boolian Truth Table we will make decisions about success or failure of the
combinations described on each row. The second pass through the table will calculate the contribution of
each individual arranagement to the overall reliability number. The sum of all individual probabilities of
success will yield the calculated system reliability. You can browse the table starting at C31 to understant
the nuts and bolt of the method.

The bottom line: A Boolian Truth Table gives you a method to calculate a theoretical system reliability
which we will use as our datum for the theorectical reliability shown in cell I26. Now we can test our
simulation against the true answer to measure how well our Monte Carlo simulation has done in reaching
the correct answer.

We'll use Excel's RAND() feature which will produce a random number between 0 and 1 with a uniform
chance for an occurrence. This is helpful since reliability numbers also lie between 0 and 1!

For details on the success/failure criteria, refer to the Series Model--Reliability #s for details.

Along the right hand side of the complex model you will find some typical results obtained by simulation.

Now pull this information sheet to the side and run the simulation.

Page 6
Air Compressor Simulation

Given: From th e We ibu ll li brary, sele ct Wei bul l chara cte ristic fa ilu res fo r e ach co mpon ent--use thi s i nformatio n to simul ate fa ilu res.
Simulation Objective : Find MTTF, rep air costs, MTTR, a nd ove rall ma inten an ce cost o f a comp ressor.
Define mission time (hours)---> 3000 Wind-down Model--Using A Fix When B roken Strate gy
Data Given For The Simulation Find By Simulation
We ibull
Weibull Compone Dec is ion
et a
be ta $ Co st $ Co st Random nt Li fe Re m aining Column
(ho ur s) Re pai Sum Of Sum Of
Co m pone (F r om per pe r Age-to- F rom Life In 1 = M TTF S um Of Fai lure
(F ro m r Tim e S im ul ated Repai r T im e,
nt F a iling y our fa ilure f ailur e Fai lur e, Random Co m po ne n F ail ure (hrs/ fail .) Costs, ($)
yo ur ( hrs ) Fai lures (#) (hrs)
dat a base (L +E ) ( Ma t'l) (h rs) Draw t, ( hrs) 0=S urvi v
da t aba se (h rs) al
)
)

Auto Drain 1.9 5,000 $75 $50 1.5 ### #VALUE! #VALUE! ### #VALUE! #VALUE! #VALUE!
Reed Valves 2.3 6,000 $600 $1,000 12 ### #VALUE! #VALUE! ### #VALUE! #VALUE! #VALUE!
Unloader 4 5,000 $100 $100 2 ### #VALUE! #VALUE! ### #VALUE! #VALUE! #VALUE!
Bearings 1.3 12,000 $4,000 $4,000 40 ### #VALUE! #VALUE! ### #VALUE! #VALUE! #VALUE!
Rings 2 10,000 $4,000 $3,500 40 ### #VALUE! #VALUE! ### #VALUE! #VALUE! #VALUE!
Pistons 2.5 15,000 $4,000 $5,000 40 ### #VALUE! #VALUE! ### #VALUE! #VALUE! #VALUE!
Check Valve 1.1 10,000 $150 $200 3 ### #VALUE! #VALUE! ### #VALUE! #VALUE! #VALUE!
Motor 1.2 12,000 $800 $2,200 8 ### #VALUE! #VALUE! ### #VALUE! #VALUE! #VALUE!
Vee Belts 1.8 8,000 $300 $1,500 3 ### #VALUE! #VALUE! ### #VALUE! #VALUE! #VALUE!
Weibull MTTF-> 803 See cells P9:R24 for theoretical values
#VALUE! #VALUE! ### #VALUE! #VALUE! #VALUE!
#VALUE! Cumulative number of successes during the mission time interval--> #VALUE! #VALUE! <--iterations
Cumulative Run Time--> #VALUE! hrs Mean time to failure--> hrs/failure
#VALUE! #VALUE! ### Cum. Repair Time--> #VALUE! hrs Failure rate--> failures/hr
Wall Clock Time---> #VALUE! hrs Mean time to repair--> hrs/repair
#VALUE! #VALUE! ### Wall Clock Yrs--> #VALUE! yrs Maintenance Costs--> $/hr
Exponential Reliability-->
#VALUE! #VALUE! ### Availability-->

Inte r-
Failur e Failures Auto Drain
Number a rriva l
Time s
#VALUE! #VALUE! #VALUE! #VALUE!
Air Compressor Simulation
(A little bit of simulation information for orientation)

Read this narrative (double click inside this box and cursor down or pull down
the lower edge of this block). Then slide this sheet to one side, I.e., click on
the border, hold down the left mouse key, and drag to one side to uncover the
spread sheet.

Do not delete this sheet, you may need some clues later when you build your
own models!

This model shows a block diagram of a small, air compressor. The items
listed are in series. Failure of one item causes the entire system to fail. The
issue is to find the failure rate, average repair times, maintenance costs,
reliability, and availability for the air compressor. This model has been
improved over earlier versions to permit running out the clock on each part to
reach failure rather than selecting the shortest life part (which was easier to
program and gave optimistic results from it's simplicity.

The model begins by drawing an initial random life for each component, and
the component ages as it's clock runs-down to achieve the age-to-failure
criteria which exist when no more time is left on the clock for a given
component. Excel's RAND() feature produces a random number between 0
and 1 with a uniform chance for an occurrence. The RAND() number is
substituted for the Weibull CDF (which of course varies between 0 and 1).
The age to failure time is obtained by solving the Weibull equation for time: t =
η *(ln(1/(1-RAND())))^(1/β )) where RAND() has been substitued for the CDF.

The criteria for failure is when no more time remains on the clock for the
component. Notice the reliability and availability calculation summary. High
availability values gives you a chance to make money. Low reliability (I.e.,
high unreliability) numbers gives you a chance to loose money for outages
and repairs. It is not unusual for industrial applications to show high
availability and low reliability for a given mission interval (the situation is often
described as a maintenance problem). Reliability values are often determined
by the class of equipment procured and the expected mission time between
"turnarounds" (I.e., renewal).

As an exercise, you can select the component causing the largest amount of
grief and replace it with a part made from "Kryptonite" so the characteristic life
is 100 times greater than the troublesome part. Then run the iteration again
to determine if your magic bullet has "cured" your problem. You'll soon learn
why substantial cost/repair improvements require a reliability improvement
program rather than a single, magic bullet!

Now pull this information sheet to the side and run the simulation.

Pag e 7
Air Compressor Simulation

Pag e 8
 Simple Business Failure Model

Given: Weibull Statistical Failure Characteristics (hrs), Repair Time (hrs), Cost For Outages, and Mission Time
Reset & Iterate Find: Availability, Reliability For The Mission Time, MTBF, and Cost Of Unreliability Per Year in M36-M40
Go To Table Method: Monte Carlo Simulation Using Weibull Ages To Failure
Of Contents
Details Below-- Cell---> 1 2 3 4 System
Age To Failure Data:
Weibull Shape Factor, β---> 1 1 1 1
Weibull Characteristic Life, η---> 18000 20000 12000 75000 4945 <--Theoretical MTBF
Time To Repair Data:
Weibull Shape Factor, β---> 1.5 2.1 3 1
Weibull Characteristic Life, η---> 30 18 15 100
Repair: Costs:
Parts ($/incident)---> 1000 5000 10000 10
Labor & expense ($/hr)---> 60 100 150 150
Scrap disposal ($/incident)---> 0 500 1000 2000
Lost Production ($/hr)---> 5000 5000 5000 5000
Results For Each Iteration: System Results This Iteration
Simulated age to failure (hrs)---> 2076 3634 11832 11753 2076
Reliability just before failure---> 0.8911 0.9014 0.8411 0.9727 0.6571
Run time until failure---> 2076
Simulated repair time (hrs) 66 12 15 67
Repair time (hrs)---> 66 66
Availability---> 0.9693 0.9693
Cost Of Unreliability---> $333,998 $333,998
Mission Requirements: Mission Time
Mission Time Required, T---> ------------------------>--------------------------- >--------------------------- >-------------------------------->
-> 8760 <-- Note the mission time for the plant
Success = (1) for mission, T---> 0 0 1 1 0
<--Click On Button To The Far Left To Expand/Shrink Spreadsheet And Weibull Data
Summary Results: System Summary
1 Number of Iterations---> #VALUE! <-- Note the total number of iterations
Cum hrs til failure---> #VALUE!
Cum hrs to repair---> #VALUE! 0 #VALUE! #VALUE! #VALUE!
Cum number of repairs---> #VALUE! #VALUE! #VALUE! #VALUE! #VALUE!
Cum # Success For Mission---> #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! <-- If low compared to total # iterations, watchout for high costs!!
Cum cost of unreliability--> #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! <-- Note the high cost of unreliability!!!!
Availability---> #VALUE! <-- Availability is the chance to make money
Reliability---> #VALUE! <-- Unreliabilty (1- reliability) is the chance to loose $s from failures
MTBF---> #VALUE! <-- if MTBF is much less than the mission time!! Expect failures!!
Cost of unreliability $s/yr--> #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! <-- How much can you afford to loose?
#VALUE!
Pareto cost problem rank---> #VALUE! #VALUE! #VALUE! #VALUE! <-- Pareto work priority list.

Important: Know the cost of unreliability by each block. Build a Pareto action list based on $s rather than nose counts of failure occurrences.
Modeling doesn't solve problems--people solve problems!!

Simple Business Failure Model With Cost Numbers

(A little bit of simulation information for orientation)

Read this narrative (double click inside this box and cursor down or pull down the lower edge of this block). Then slide this sheet to one side, I.e., click on the border, hold
down the left mouse key, and drag to one side to uncover the spread sheet. Do not delete this sheet, you may need some clues later when you build your own models!

This model is a block diagram of a simple plant. It's a business model for the Plant Manager who wants to know how much can be spent to fix the problems and
where to concentrate problem solving efforts. Of course, you know the Plant Manager's boss is also going to ask for a million facts to justify spending any money to fix
a problem so we've got to include some other indicators that are routinely discussed in the front office. By the way, you need to know that this plant runs around the clock
and has an annual turnaround once a year for a period of four days to renew the entire plant using an army of contract workers--so the mission time for the plant is 8760
hours.

The plant has a feed section in block 1, a high temperature furnance operation in block 2, a separation process in block 3, and instrument failures are described in block
4. The ages to failure for the main failure modes would be found by inputing plant failure data from the control room log book into WeibullSMITH or WinSMITH Weibull
software packages to calculate the Weibull values for beta and eta. Likewise plant repair times have been collected for each block and the statistical characteristics for the
Weibull distribution are reported for how long it takes to make repairs. Yes, a better definition for repair times could be obtained by using the Log-Normal distribution but
this makes the calculations a little more obtuse.

The accounting department provided us average values of repair costs for: parts, labor & expense, scrap disposal, and lost production (this value represents the variable
gross margin that is lost because the plant is sold-out and any downtime is a big loss which gets the Plant Manager called onto the carpet by the VP of Manufacturing
whenever the plant does not run with the throttle to the fire wall (it's not nice to cause Plant Managers grief--so we need to get some numbers PDQ)!!!

We'll use Weibull characteristics to describe times to failure using Monte Carlo simulation for this complex problem (yes, most often these values are chosen for a beta = 1
for mixed modes of failure). Then we can characterize the failures, find the mean times to failure, costs of failures, etc. When we know the average cost per failure and the
MTTF, we can compute how many crashes we will have per year (on the average).

Our company, like many others, requires a one year payback on projects. This means we must also know how much we can afford to spend to fix the problems which are
totaled in the row called the cost of unreliability ($s/yr) and where we should start to work based on the Pareto costs. So we've got to have some good ideas on how to fix
the problem at a price less than the annual cost of unreliability. If correction costs are too high, we're saddled with the loss called the cost of unreliabilty. We've been told
the Solomon Report (from a consulting group for our industry) that we rank in the bottom quartile for plant reliability. Everyone is waiting for a miracle cure and the boss
wants to know how much it's going to cost and where we concentrate our efforts!

By the way, if we spent US$10,000 for a "cure" and the cure fixes ~US$200,000 of the annual cost of unreliability then we'll probably get a big bonus for our good work. In
other words, if we only have to spend ~$10,000 and save ~$200,000 that's a big annual payback!!! We want to make sure the boss understands the numbers so we can
get our hero award! You don't always have to throw hardware and software at unreliability problems--sometimes the largest gains involve people and processes.

Use Excel's RAND() feature which will produce a random number between 0 and 1 with a uniform chance for an occurrence. This is helpful since reliability numbers also
lie between 0 and 1! However, we've got to put this random number into the Weibull equation so we can produce Monte Carlo times to failure. Here's how you get the
equation set-up correctly. First, solve the Weibull CDF equation for time to failure: t = η *(LN(1/(1-CDF)))^(1/β ). Second, replace the CDF value (which conviently varies
0 to 1 just as does the RAND feature!!) with the RAND() equation. Third, run the simulation for each block element using the criteria described in the spreadsheet.

Now pull this information sheet to the side and run the simulation.

Page 9
 Do Failures Have Groups Of 2 Or 3?
Use random numbers and Weibull distributions to validate the hypothesis.
The Weibull equation solved for time t = η*(ln(1/(1-CDF)))^(1/β)
CDF = Rand()--> 0.44 Beta--> 1.5 Eta--> 100 48.81
Number Of Failures--> 1 2 3 4 5 6 7
Draw 10
Random 48.81 183.63 28.01 59.59 53.87 174.15 17.24
Ages-to-
Convert Ages-to-
Faiure-->
Failure To Wall Clock 48.81 152.40 344.43 409.68 536.87 650.12 776.89
Time-->
Gap = B10*G4 1.1 1 1 1 1 1 1 1
Decision
For 25.0%
Groups--> 1

0.9
0 100 200 300 400 500 600 700 800 900
Wall Clock Time For 10 Random Failures
Groups--> 0 1 2 3 4 5 6 7
Yes
Group Location-->
Time Slot-->
0 1 0 0 0
Frequency Of 0
Groups 0 0
Cum #--> #VALUE!
12
#VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE!
% Count--> 10
8
% Of Total

0
0 1 2 3 4 5 6 7 8 9
Number Of Groups
 1
Do Failures Occur In Groups?

Exercise-
<--Random Age-to-failure Use beta = 50 (never exists)
8 9 10 What do you conclude?
Use beta = 3 (some failures exist)
20.18 65.66 224.54 What do you conclude?
Use beta = 1 (lots of failures exist)
What do you conclude?
857.20 903.71 906.82 Use beta = 0.7 (some failues exist)
What do you conclude?
1 1 1 Notice:
The grouping criteria in cell B10 can
substantially alter the outcome of
1 decisions about groups. If failure
points are within each other by say
25%*Eta, you get one conclusion.
However, if they are within 100% of
00 700 800 900 1,000 Eta, you reach a different conclusion
ndom Failures about grouping of data points.

8 9 10

F10-F9
906.8
0 0 0 Total Σ Groups % Groups
#VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE!

7 8 9 10
 Why Use Monte Carlo Simulations

Why Use Monte Carlo Simulations

(A little bit of Monte Carlo simulation information for orientation--see readling list at the end of this information)

Read this narrative (double click inside this box and cursor down or pull down the lower edge of this block). Then slide this sheet to
one side, I.e., click on the border, hold down the left mouse key, and drag to one side to uncover the spread sheet.

Do not delete this sheet, you may need some clues later when you build your own models!

1. Monte Carlo (MC) simulations use random numbers and math/statistical models to simulate (imitate) reality. We make
assumptions about how a model behaves (based on samples of data or engineering assumptions) to gain an understanding about
how the corresponding real life system behaves.

2. Most real-world systems are too complex for analytical evaluations. Models must be studied with many simulations to estimate
real-life conditions. MC models are computer intensive and require many iterations to get a central tendency and many more
iterations to get confidence limit bounds.

3. MC models help solve complicated deterministic problems (I.e., no random components) and probabilistic (stochastic) problems
(I.e., contains random components). Deterministic systems usually have one answer and perform the same way each time.
Probabilistic systems have a range of answers with some central tendency. MC models using probabilistic numbers never give the
same exact results. When you re-run simulations you'll never get the same exact answers because random numbers are used for the
simulation. Look for the central tendency of the numbers, search for an understanding of the scatter in the data, and study the
significant numbers in the results.

4. Each MC run produces only estimates of real world results--better models give better results and garbage inputs give garbage
outputs. If the model is not a "valid" description of reality, then no amount of numbers will give the "right" answer! MC models must
have credibility checks for reality--don't substitue computer generated numbers for good sense. If the model is not valid, no amount of
simulations will improve conclusions. The results must make sense and represent reality and MC scatter should resemble the real
system variation.

5. MC models allow simulations to get answers at low cost (during our own life time) without building the system and then incurring
the expense to operate the system. MC estimates of "ball park" numbers are obtained in a short period of time. This is far better than
the perfect answer obtained 100 years into the future!! You'll never get a risk free answer to your problems. More data, more
simulations, and more sophisticated models reduce your overall risks---if you have enough time and money.

6. MC models in this file will (for the most part) use the Weibull equation (and the special condition case where β =1 for the
exponential distribution. The RAND() operator from EXCEL will be used to draw a random number between 0 and 1.

7. The Weibull equation used for simulations has been solved for time where t=η *((ln(1/(1-F(t))))^(1/β )). To make use of random
numbers, the cummulative distribution function (CDF) is represented by F(t). The F(t) is simulated by use of the RAND() operator
since it also varies between 0 and 1 as does the F(t).

8. Many statistical distributions are available for MC models, choose: Add-Ins from Tools menu, select Analysis ToolPak box from
Add-ins box and click OK. From Tools menu, choose Data Analysis and select Random Number Generation and click OK. EXCEL's
random number generator allows these distributions: Uniform, Normal, Bernoulli, Binomial, Poisson, Patterned, and Discrete.
Remember we'll generally use the Weibull Equation for our MC's and RAND() function in lieu of the CDF.

9. To run MC models in EXCEL 5.0+, make sure you are set-up as follows: from the Tools menu, choose Options, from the "file"
cards, choose Calculations--then click x's for Manual, Iterations, and set iterations to 1. During the initialization (when the Initiliaze and
Go To The Table Of Contents key is pressed) the spreadsheet will do this for you automatically.

10. A mistake often make by beginning modelers is to include an excessive amount of model details. Start simple. Build to complexity
after everyone understands what's happening and agrees the model is in reasonable agreement with reality.

11. Reading list for simulations:

Abernethy, Dr. Robert B., 1994, The New Weibull Handbook, Dr. Robert B. Abernethy author and publisher,
phone 407-842-4082, refer to section 4.5 and 4.6 for Monte Carlo simulations, North Palm Beach, FL.
Hamming, R.W., 1973, Numerical Methods for Scientist and Engineers, 2nd Edition, Dover Publications, New York.
Henley, Ernest J. and Hiromitsu Kumanmoto, 1991, Probabilistic Risk Assessment, IEEE Press, New York.
Law, Averill M. and W. David Kelton, 1991, Simulation Modeling & Analysis, 2nd Edition, McGraw-Hill, New York.
Mann, Nancy R., Ray E. Schafer, and Nozer D. Singpurwalla, 1974, Methods for Statistical Analysis of Reliability
and Life Data, John Wiley & Sons, New York. <---This is a difficult text book!!!!
Newendorp, Paul D., 1975, Decision Analysis For Petroleum Exploration, PennWell Books, Tulsa, OK.
Ragsdale, Cliff T., 1995, Spreadsheet Modeling and Decision Analysis--A Practical Introduction to
Management Science, Course Technology, Inc., Cambridge, MA, ISBN 1-56527-277-3 <---Lots of how to do
examples.

Page 12
 More Info

A full set of MonteCarloSimulations Excel 5.0+ spreadsheets are available for US$40.00 (including handling & shipping) from:
Barringer & Associates, Inc.
P.O. Box 3985
Humble, TX 77347-3985 USA
Phone: 713-852-6810
FAX: 713-852-3749

Models Included on the MonteCarloSimulations Diskette:

1. Generate Random Numbers--Draw random numbers from a known Weibull distribution (the true values). The recalculate the
resulting Weibull shape factors and characteristic lives (the sample results). Calculated results will agree with WinSMITH WeibullTM
and WeibullSMITHTM results using the random numbers drawn. You can see the errors from using small sample sizes (remember,
small samples may be all that you can get and in practice you may never know the true values for beta and eta). WinSMITH Weibull
and WeibullSMITH are trademarks of Fulton Findings for probability plotting software products--WinSMITH operates in a Windows
environment and WeibullSMITH operates in a DOS environment.

2. Simple Series Failure Model--Use Weibull equations to draw random values for age to failure for several elements in series. The
system fails at the smallest value for age to failure. For a well matched system, you can see the difficulties of only improving one
element in the series with the hope of extending the system life.

3. Competing Series Failure Model--Use Weibull equations to draw random values for age to failure using several elements in
series. One element has several different failure modes (the mode with the shortest age to failure is the pacing element). This model
is similar to the Simple Series Failure Model but includes the complication of allowing competing failure modes.

4. Optimum Replacements--Use Weibull equations to draw random values for age to failure for a given model to generate the
optimum replacement curve. As more iterations occur, the shape of the curve becomes more distinct. This is not as efficient as using
determinate optimum replacement equations to make the calculations but it shows how to use random numbers to generate a
replacement curve.

5. Replacement/Inspection--Use Weibull equations to draw random values for age to failure using a criteria of an inspection interval
to accept continued operation without replacement. The model allows a study of the relative efficiency for inspection versus planned
replacement intervals.

6. Failure Modes And Effects--Use Weibull equations to draw random values for age to failure for a failure modes and effects chart
to study the results as age to failure is not known precisely and random events alter the results.

7. Fault Tree Analysis--Use Weibull equations to draw random values for age to failure for a fault tree analysis.

8. Maintenance Replacement Strategy--Two strategies are considered: 1) replace when failed, and 2) timed replacements. Weibull
age to failures are drawn randomly to simulate failures and the cost of the results are used to determine which strategy is correct for a
specified beta and eta.

9. Process Diagram Simulation--Three chemical plant dryers feed a process. Each dryer has a different capacity and their output
deteriorates according to a Weibull distribution. The process has a business plan volume requirement. The question is: What are the
odds (reliability) of meeting or exceeding the annual business plan requirements.

10. Air Compressor Life & Costs--A simple air compressor model uses Weibull equations to describe age to failure. Costs/repair
times are shown for making the replacement at failure. The model gives overall MTBF, costs per hour, and other operational details.

11. Input Fleet Of Aged Parts--The model starts with an age of the fleet of 100 items selected from a Weibull distribution. The
output shows the results of failures and continued operations based on an inspection strategy.

12. Usage Rate Input--A Weibull distribution is input which describes how things fail and how many units are in operation. A
projection of failures expected are returned to forecast spare parts consumptions.

13. Plant Manager's Production Model--Last years daily production is used to compute a Weibull model and find beta and eta. As
usual, corporate is pushing the production goals upward and the plant manager's bonus is based on a new goal. The models shows
the chances for the plant manager making his bonus using the new goals (and gives clues about the need -- or lack of need -- for
making production changes) to get a payoff on his bonus program.

14. Fix Failures On Overtime?--A model of redundant equipment is shown with Weibull descriptions of failures. Repair times are
shown for overtime repairs and normal repairs along with cost of repairs and the plant losses incurred if both pieces of equipment are
down simultaneously. The answer gives the chances for success if the equipment is repaired on a crash overtime basis or under
normal repair intervals without spending for overtime.

15. Replacement Rhythms--Replacement rhythms shows clusters of failures using times and untimed replacements. Weibull
equations model the ages to failure.

16. Size Tankage To Protect Against Failures--A small process system is equipped with tankage to provide process fluids during
equipment outages. Equipment life and level in the tanks is modeled with Weibull equations. Volume of the tank can be varied along
with costs to find the optimum requirements for the size of the tank.

Page 13