Title: Joint planning for spare parts inventory and preventive maintenance in a multi-echelon network

Authors: Yue Shi; Yisha Xiang; Tongdan Jin; Yueqing Li

Addresses: Department of Industrial Engineering, Lamar University, Beaumont, TX 77710, USA ' Department of Industrial Engineering, Lamar University, Beaumont, TX 77710, USA ' Ingram School of Engineering, Texas State University, San Marcos, TX 78666, USA ' Department of Industrial Engineering, Lamar University, Beaumont, TX 77710, USA

Abstract: Spare parts inventory and preventative maintenance play a vital role in ensuring operational availability of capital equipment. This paper investigates the cost-reliability benefits from jointly optimising preventive maintenance and spare parts inventory. Due to the problem complexity and the mathematical intractability, we propose a simulation framework to tackle this joint planning problem in a multi-echelon network. The general simulation model developed in this paper allows a closer-to-reality analysis of joint decisions on spare parts inventory and preventive maintenance for a fleet of equipment with increasing failure rates. Both block- and age-based preventive maintenance policies are considered. We also adopt a performance-based contracting approach to analysing the trade-off between inventory cost and target availability in different incentive mechanisms. Numerical experiments are presented to illustrate the effectiveness of the joint policies.

Keywords: spare parts inventory; preventative maintenance; performance contracting; multi-echelon networks; simulation; inventory management; inventory cost; target availability; incentive mechanisms.

DOI: 10.1504/IJIR.2016.081897

International Journal of Inventory Research, 2016 Vol.3 No.3, pp.263 - 281

Received: 27 Aug 2016
Accepted: 23 Sep 2016
Published online: 30 Jan 2017 *

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