An inventory control system for spare parts at a refinery: An empirical comparison of different re-order point methods

Porras, Eric; Dekker, Rommert

doi:10.1016/j.ejor.2006.11.008

Cited by 151 publications

(105 citation statements)

References 9 publications

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“…Another occurs in spare parts management, where parts used for corrective maintenance may wear. Empirical results by Porras and Dekker (2008) under a continuous (s, S) system confirm that assuming demand is driven by a Poisson process results in overstocking spare parts having 0/1 demands. Numerous papers in the area of spare parts modelling assume a continuous review system; interested readers are referred to Kennedy et al (2002) for an overview in this area.…”

Section: Motivation and Research Relevancementioning

confidence: 54%

On the benefits of delayed ordering

Syntetos

Teunter

Babaï

et al. 2016

European Journal of Operational Research

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Practical experience and scientific research show that there is scope for improving the performance of inventory control systems by delaying a replenishment order that is otherwise triggered by generalised and all too often inappropriate assumptions. This paper presents the first analysis of the most commonly used continuous (s, S) policies with delayed ordering for inventory systems with compound demand. We analyse policies with a constant delay for all orders as well as more flexible policies where the delay depends on the order size. For both classes of policies and general demand processes, we derive optimality conditions for the corresponding delays. In a numerical study with Erlang distributed customer inter-arrival times, we compare the cost performance of the optimal policies with no delay, a constant delay and flexible delays. Sensitivity results provide insights into when the benefit of delaying orders is most pronounced, and when applying flexible delays is essential.

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Section: Motivation and Research Relevancementioning

confidence: 54%

On the benefits of delayed ordering

Syntetos

Teunter

Babaï

et al. 2016

European Journal of Operational Research

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show abstract

“…The sequential computation of and = − as we use and other variations is a common approach in the literature of inventory control (see for example, several decision rules in [1] that work sequentially, [8] and [11]). An important distinction is how to consider the demand behaviour, which affects the tractability of the fill rate.…”

Section: Demand Modelling and Solving Methodologymentioning

confidence: 99%

“…We choose these traditional distributions which have proved to be effective in case studies ( [9], [10], [11], [21]). They are also easy to communicate to practitioners and to implement in software packages of common use.…”

Section: Demand Modelling and Solving Methodologymentioning

confidence: 99%

“…Applications in other contexts include the service support of IBM in the US (Cohen et al [7]), a chemical plant in Belgium (Vereecke and Verstraeten [8]), a white goods manufacturer in Italy (Kalchschmidt et al [9]) and a distributor of castors and wheels in Greece (Nenes et al [10]). In the oil industry, we have found only one recent article, published by Porras and Dekker [11]. Characterized by high service levels (because of safety and production factors), customized equipment specifications with long lead times, and facility networks spread onshore and offshore, we believe the problem of inventory management of spare parts in this industry deserves attention from the research community and our article contributes by addressing a practical problem in this industry.…”

Section: Introductionmentioning

confidence: 99%

“…As we mentioned in the introduction, the only previous contribution to recent literature of spare parts in the oil industry is given by Porras and Dekker [11]. Motivated by a case study at a refinery in the Netherlands, they compare different reorder point methods for spare parts inventory control and show that total savings of up to 6.4% in holding costs can be achieved by a better inventory control.…”

Section: Introductionmentioning

confidence: 99%

See 2 more Smart Citations

Inventory management of spare parts in an energy company

Guajardo

Rönnqvist

Halvorsen

et al. 2015

Journal of the Operational Research Society

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We address a problem of inventory management of spare parts in the context of a large energy company, producer of oil and gas. Spare parts are critical for assuring operational conditions in offshore platforms. About 200,000 different items are held in several inventory plants. The inventory system implemented at the company corresponds to a min-max system. The control parameters are decided based mainly on the expert judgment of the planners. Also, though the inventory plants can in practice be supplied from each other, the inventory planning is performed separately by the plant planners. This is because of different ownership structures where the studied company has the operative responsibility. The company is pursuing a system in which all planners conform to the same inventory management approach and evaluation, as well as being more cost efficient. Our work focuses on supporting this goal. We apply methods to decide the inventory control parameters for this system under a service level constraint. The methodology we use distinguishes unit-size and lot-size demand cases. We perform computational experiments to find control parameters for a sample of items. After the control parameters are found, we use them to explore the impact of risk pooling among the plants and inaccuracy arising from duplicate item codes. Key words:Email addresses: mario.guajardo@nhh.no corresponding author tel.: +47 55959834 fax: +47 55959650 (Mario Guajardo), mikael.ronnqvist@nhh.no (Mikael Rönnqvist), amaha@statoil.com (Ann Mari Halvorsen), svkal@statoil.com (Svein Inge Kallevik) Preprint submitted to NHH Discussion Series June 6, 2012Inventory of spare parts; risk pooling; duplicates; inventory inaccuracy; OR in the oil and gas sector.

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Non‐parametric Methods

2021

Intermittent Demand Forecasting

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An inventory control system for spare parts at a refinery: An empirical comparison of different re-order point methods

Cited by 151 publications

References 9 publications

On the benefits of delayed ordering

On the benefits of delayed ordering

Inventory management of spare parts in an energy company

Non‐parametric Methods

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