A multi-item approach to repairable stocking and expediting in a fluctuating demand environment

Arts, Jos

doi:10.1016/j.ejor.2016.06.003

Cited by 20 publications

(10 citation statements)

References 41 publications

Supporting

Mentioning

Contrasting

Order By: Relevance

“…Decomposing this problem leads to relatively simple sub-problems per repairable type. This technique has been used extensively in recent contributions on spare part inventory optimization (e.g., Alvarez et al 2013, Arts 2017, Kranenburg and Van Houtum 2007, Topan et al 2017, Wong et al 2007. Most contributions only consider an aggregated service level constraint that links the different repairable types.…”

Section: Literature Reviewmentioning

confidence: 99%

Expediting in Two-Echelon Spare Parts Inventory Systems

Drent

Arts

2021

M&SOM

Self Cite

View full text Add to dashboard Cite

Problem definition: We consider dual sourcing in a distribution network for spare parts consisting of one central warehouse and multiple local warehouses. Each warehouse keeps multiple types of repairable parts to maintain several types of capital goods. The repair shop at the central warehouse has two repair options for each repairable part: a regular repair option and an expedited repair option. Irrespective of the repair option, each repairable part uses a certain resource for its repair. In the design of these inventory systems, companies need to decide on stocking levels and expedite thresholds such that total stock investments are minimized while satisfying asset availability and expediting constraints. Academic/practical relevance: Although most companies have the possibility to expedite the repair of parts in short supply, no contributions have been made that incorporate such dynamic expediting policies in repairable investment decisions. Anticipating expediting decisions that will be made later leads to substantial reductions in repairable investments. Methodology: We use queueing theory to determine the performance of the central warehouse and subsequently find the performance of all local warehouses using binomial disaggregation. For the optimization problem, we develop a greedy heuristic and a decomposition and column generation based algorithm. Results: Both solution approaches perform very well with average optimality gaps of 2.38 and 0.27%, respectively, across a large test bed of industrial size. The possibility to expedite the repair of failed parts is effective in reducing stock investments with average reductions of 7.94% and even reductions up to 19.61% relative to the state of the art. Managerial implications: Based on a case study at Netherlands Railways, we show how managers can significantly reduce the investment in repairable spare parts when dynamic repair policies are leveraged to prioritize repair of parts whose inventory is critically low.

show abstract

Section: Literature Reviewmentioning

confidence: 99%

Expediting in Two-Echelon Spare Parts Inventory Systems

Drent

Arts

2021

M&SOM

Self Cite

View full text Add to dashboard Cite

show abstract

“…Instead of solving the original complex optimization problem, the problem is decomposed by spare part and the resulting single-item optimization problems are solved repeatedly. This method has recently received increasing attention in the multi-item spare parts inventory optimization literature (Kranenburg and Van Houtum 2007, Wong et al 2007, Topan et al 2010, Alvarez et al 2013, Alvarez et al 2015, Arts 2017, Topan et al 2017, and Drent and Arts 2020. Details on fundamentals and theoretical background of decomposition and column generation are provided by Dantzig and Wolfe (1960) and Desrosiers and Lübbecke (2005).…”

Section: Literature Reviewmentioning

confidence: 99%

“…Such an approach has recently been applied by Alvarez et al (2013Alvarez et al ( , 2015, Arts (2017), and Drent and Arts (2020). Alvarez et al (2013Alvarez et al ( , 2015 showed that it performs better than using the fractional solution of (RMP ) as a starting point for local search as done by Van Houtum (2007, 2008).…”

Section: Column Generation Approachmentioning

confidence: 99%

How to Change a Running System—Controlling the Transition to Optimized Spare Parts Inventory Policies

Haubitz

Thonemann

2021

Production and Operations Management

View full text Add to dashboard Cite

Inventory optimization approaches typically optimize steady-state performance, but do not consider the transition of an initial state to the optimized state. In this paper, we address this transition. Our research is motivated by a company that implemented an improved inventory policy for its spare parts division. The improved policy suggested new base stock levels for the majority of the parts. For parts with increased base stock levels, inventory increases were realized after the part lead times, but for low-demand parts with decreased base stock levels, inventory reductions were slow. As a result, inventory cost increased over the first months after the new inventory policy had been introduced and exceeded the inventory budget substantially. To avoid such undesirable effects, base stock level changes must be phased in. We consider a multi-item spare parts inventory system, initially operating under an item approach inventory policy that achieves identical fill rates for all parts. Our approach addresses the transition to a superior system approach inventory policy that maximizes the system fill rate. We model the inventory transition as a finite-horizon optimization problem and apply column generation and a marginal analysis heuristic to determine transient base stock levels for all parts. Using data from the company that motivated our research, we illustrate how the transition can be controlled to quickly improve fill rates without exceeding the initial inventory budget.

show abstract

“…(ii) In the support system, the support vessel and the member warships take the continuous replenishment stock policy (s − 1, s) [21]. (iii) The demand rate of spare parts follows the Poisson distribution [22] during a certain period, and the repaired spares can be used alternatively as a new one.…”

Section: Spares Demand Rate Of Redundant Systemmentioning

confidence: 99%

Mission-oriented dynamic optimization model of carrying spares for warship redundant system

Minzhi

Wang

2018

Journal of Systems Engineering and Electronics

View full text Add to dashboard Cite

Redundancy is a common structure for warship system, and it is an effective way to improve the reliability of the system. In this paper, warship system is taken as the object of study, based on the system reliability equivalence principle, a spares demand rate calculation method for redundant system is proposed through structure transformation. According to the system analysis method, the general modeling data structure of spares support echelon and system indenture is established, and the mission success probability is taken as the optimization target to build the dynamic optimization model of carrying spares during the process of multi-phase. By introducing the Lagrange multiplier, the spares weight, volume and cost are transformed to the single target of the spares total scale, and the initial Lagrange factors and its dynamic adjustment policy is proposed. In a given example, the main influence factors of the carrying spares project are analyzed, and the study results are in accordance with the reality, which can provide a new approach to mission-oriented carrying spares optimization for the redundant system.

show abstract

A multi-item approach to repairable stocking and expediting in a fluctuating demand environment

Cited by 20 publications

References 41 publications

Expediting in Two-Echelon Spare Parts Inventory Systems

Expediting in Two-Echelon Spare Parts Inventory Systems

How to Change a Running System—Controlling the Transition to Optimized Spare Parts Inventory Policies

Mission-oriented dynamic optimization model of carrying spares for warship redundant system

Contact Info

Product

Resources

About