Optimizing maintenance service contracts under imperfect maintenance and a finite time horizon

Abstract

When a company decides to outsource a service, the most important reasons for doing so usually are to focus on core business, to be able to access high-quality services at lower costs, or to benefit from risk sharing. However, service contracts typically follow a structure whereby both owner and contractor attempt to maximize expected profits in a noncoordinated way. Previous research has considered supply chain coordination by means of contracts but is based on unrealistic assumptions such as perfect maintenance and infinite time-span contracts. In this work, these limitations are overcome by defining the supply chain through a preventive maintenance strategy that maximizes the total expected profit for both parties in a finite time-span contract. This paper presents a model to establish such conditions when maintenance is imperfect, and the contract duration is fixed through a number of preventive maintenance actions along a significant part of the asset life cycle under consideration. This formulation leads to a win-win coordination under a set of restrictions that can be evaluated a priori. The proposed contract conditions motivate stakeholders to continually improve their maintenance services to reach channel coordination in which both parties obtain higher rewards.where t represents time, k corresponds to the index of the k-th preventive action, and˛is the maintenance improvement factor, 0 6˛6 1 3. Corrective maintenance is minimal. 4. Direct (spare+labor) costs and length of PM are C p (money units, mu) and T p (time units, tu), respectively. 5. Direct costs and length of corrective maintenance are, respectively, C r (mu) and T r (tu). 6. The interval between PM is T (tu).

Data management in maintenance outsourcing

“…Some other relevant references (dealing with very specific issues) are the following: [8]: maintenance contract negotiations for ageing equipment. [16]: optimising maintenance contract with imperfect information.…”

A Collaborative Cloud Service Platform for Realizing Sustainable Make-To-Order Apparel Supply Chain

“…Outsourcing mechanism plays a vital role in today's SC, as it could bring many advantages to companies, such as better quality of service and product delivery capability improvement [22]. In apparel SC, under most circumstances, this mechanism is usually utilized by a large company in apparel SC to re-distribute their orders to a group of SMEs.…”

Two types of learning effects on maintenance activities

“…Wu et al (2010) studied maintenance policies for a finite life-cycle system prone to degradation and Poisson failures. Pascual, Godoy, and Figueroa (2013) optimise a maintenance outsourcing contract over a finite horizon where maintenance activities might be imperfect. There have also been a number of recent papers studying the joint optimal decisions of maintenance and production policies over a finite horizon.…”