Condition-Based Maintenance (CBM) and Prognostics and Health Management (PHM) technologies aim at improving the availability, reliability, maintainability, and safety of systems through the development of fault diagnostic and failure prognostic algorithms. In complex engineering systems, such as aircraft, power plants, etc., the prognostic activities have been limited to the component-level, primarily due to the complexity of large-scale engineering systems. However, the output of these prognostic algorithms can be practically useful for the system managers, operators, or maintenance personnel, only if it helps them in making decisions, which are based on system-level parameters. Therefore, there is an emerging need to build health assessment methodologies at the system-level. This research employs techniques from the field of design-of-experiments to build response surface metamodels at the system-level that are built on the foundations provided by component-level damage models.

The development and implementation challenges associated with a proposed load allocation paradigm for fault risk assessment and system health management based on uncertain fault diagnostic and failure prognostic information are investigated. Health management actions are formulated in terms of a value associated with improving system reliability, and a cost associated with inducing deviations from a system's nominal performance. Three simulated case study systems are considered to highlight some of the fundamental challenges of formulating and solving an optimization on the space of available supervisory control actions in the described health management architecture. Repeated simulation studies on the three case-study systems are used to illustrate an empirical approach for tuning the conservatism of health management policies by way of adjusting risk assessment metrics in the proposed health management paradigm. The implementation and testing of a real-world prognostic system is presented to illustrate model development challenges not directly addressed in the analysis of the simulated case study systems. Real-time battery charge depletion prediction for a small unmanned aerial vehicle is considered in the real-world case study. An architecture for offline testing of prognostics and decision making algorithms is explained to facilitate empirical tuning of risk assessment metrics and health management policies, as was demonstrated for the three simulated case study systems.