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Comprehensive long term maintenance contracts are a recent trend in equipment industries. At the same time increasing environmental concerns and high prices for raw materials stress the importance of remanufacturing activities. Hence, maintenance contracts often result in remanufacturing of some critical components. We consider the situation in which an industrial equipment manufacturer offers multi-year maintenance contracts with an uptime guarantee. To provide these service contracts profitably, the company needs to decide on the contract design: selling price, overhaul interval and uptime guarantee. Moreover, the company has to invest in the required logistics network. The logistics network is determined by the locations, number and capacity level of the remanufacturing facilities and the number of field technicians in each service region. The network design and the overhaul interval affect the level of service in terms of machine uptime, and consequently, the price that customers are willing to pay for the service contract. The lead times throughout the network are stochastic in nature

As the trend towards more after sales services progresses through the industrial equipment industry, OEMs are now offering comprehensive service contracts in which they take full responsibility for the functioning of their customers' machines. The growing responsibilities allow for more leeway in determining how to maintain the machinery. At the same time the OEM is directly effected by the success of its maintenance operations. This is certainly the case for capacity decisions in its field operations, which is the focus of this paper. One of the most important capacity decisions in field service operations is determining the training level of technicians. A field service organization can employ fully cross trained technicians which are trained to execute any service job. However, training and retaining these employees can be very expensive. Therefore, it can be cost effective to use dedicated technicians who received a focused training enabling them to perform a limited range of service jobs. We conducted a simulation study of the field service operations of an OEM in the compressed air industry to be able to evaluate the possibility to deploy technicians dedicated to preventive maintenance instead of fully cross trained technicians. We analyze the cross training decision for different scenarios in which a considerable part of the installed based is covered by service contracts. Due to these service contracts, maintenance demand as experienced by the field service organization is influenced by the cross training decisions. Our contribution consists of identifying the optimal cross training policy and the factors that influence the benefits of the different workforce configurations while taking into account the effect of the capacity decisions on the maintenance demand. We succeed to do this by characterizing the failure behavior of the individual machines. We find evidence that full cross training might be especially beneficial in a field service setting even when the effect on demand is taking into account.