<p>The reliability analysis of multi-state systems (MSSs) with degraded components over time enables the identification of a system's weaknesses or critical components. It also facilitates quantifying the effect that component failures may have on the MSS. This understanding helps us to identify a critical state of system reliability, which, if exceeded, could pose a danger to the conditions or compromise the necessary effectiveness of the operational processes. The primary research problem is to assess the state of the MSS with degraded components using the survival signature. This information is crucial for component prioritization, reliability enhancement, and risk mitigation. In this paper, we present an approach for assessing the reliability of MSS with degraded components, utilizing the survival signature concept. Based on these concepts, we also introduce techniques for measuring Birnbaum's importance, improvement potential, risk reduction, risk reduction worth, and risk achievement worth. A numerical example is presented to demonstrate and validate the technique. Additionally, a case study of an Electrical Multiple Unit (EMU) Traction Drive System and a CubeSat's electrical power system (EPS) architecture are conducted to illustrate the technique's effectiveness in engineering applications.</p>