LCC (life cycle cost) analysis is used to compute the cost of a product or system over its lifetime. By including all costs such as design, production, warranty, repair, and disposal, LCC analyses provide an accurate assessment of total system cost.

During the system design phase, LCC analysis is valuable for determining the most cost-effective solutions before substantial costs are incurred. It is also an excellent method by which you can compare the costs of different alternatives, such as redesigning an existing system versus designing a completely new system.

LCC analysis considers factors such as inflation and the time value of money to make realistic cost computations. Such analyses can also be used to perform sensitivity analysis so that you can pinpoint variables which have the most influence on system cost.

If you are unfamiliar with LCC analysis and would like to study this topic in more detail, the following text reference is an excellent resource: