An accurate determination of the system failure threshold is an essential requirement in achieving an appropriate system residual
life prediction and a reasonable planned maintenance strategy optimization afterward for degradation systems. This paper proposes a failure threshold determination method based on quantitative measurement of the similarity between the operating system
and the historical systems. The similarity is formulated by a weighted average function and then calculated by a convex quadratic
formulation to minimizing the variance between the operating system and the historical systems. With an accurate determination
of the system failure threshold in real-time, a better prediction of the residual life for the operating system is achieved. Finally, a
real case study for several power-shift steering transmission systems monitored using oil spectral analysis is adopted to illustrate
and numerically compare the improved performance of the proposed method.
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