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Product Recovery at the Norwegian National Insurance Administration

Author

Listed:
  • Nils Rudi

    (The Simon School, University of Rochester, Rochester, New York 14627)

  • David F. Pyke

    (The Amos Tuck School of Business Administration, Dartmouth College, Hanover, New Hampshire 03755)

  • Per Olav Sporsheim

    (Gorm AS, Fabrikkveien 13, 6415 Molde, Norway)

Abstract

Technical aid centers (TACs) in Norway supply devices, such as wheelchairs and hearing aids, to people with handicaps. When a device is returned to a TAC, the TAC staff must decide whether to scrap it or to refurbish it so that it can be used again. The Norwegian National Insurance Administration (NNIA) found that decision makers were scrapping units too frequently, basing their decisions mainly on the hours of labor required to refurbish. We developed a more complete decision-support-system model that accounts for the full cost of sending a unit to the landfill, the cost of refurbishing, the value of parts that can be used elsewhere, the benefits of refurbishing, and so on. Our model is quite simple and visual. Early results suggest that acceptance has been widespread and that decisions have changed, leading to fewer units being scrapped and more being refurbished for redistribution.

Suggested Citation

  • Nils Rudi & David F. Pyke & Per Olav Sporsheim, 2000. "Product Recovery at the Norwegian National Insurance Administration," Interfaces, INFORMS, vol. 30(3), pages 166-179, June.
    • Handle: RePEc:inm:orinte:v:30:y:2000:i:3:p:166-179
    DOI: 10.1287/inte.30.3.166.11663
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    References listed on IDEAS

    as
    1. Richter, Knut, 1996. "The extended EOQ repair and waste disposal model," International Journal of Production Economics, Elsevier, vol. 45(1-3), pages 443-447, August.
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    3. David F. Pyke, 1990. "Priority repair and dispatch policies for reparable‐item logistics systems," Naval Research Logistics (NRL), John Wiley & Sons, vol. 37(1), pages 1-30, February.
    4. Stephen C. Graves, 1985. "A Multi-Echelon Inventory Model for a Repairable Item with One-for-One Replenishment," Management Science, INFORMS, vol. 31(10), pages 1247-1256, October.
    5. John A. Muckstadt, 1973. "A Model for a Multi-Item, Multi-Echelon, Multi-Indenture Inventory System," Management Science, INFORMS, vol. 20(4-Part-I), pages 472-481, December.
    6. Richter, Knut, 1996. "The EOQ repair and waste disposal model with variable setup numbers," European Journal of Operational Research, Elsevier, vol. 95(2), pages 313-324, December.
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    Citations

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    Cited by:

    1. Marisa P. Brito & Rommert Dekker & Simme Douwe P. Flapper, 2005. "Reverse Logistics: A Review of Case Studies," Lecture Notes in Economics and Mathematical Systems, in: Bernhard Fleischmann & Andreas Klose (ed.), Distribution Logistics, pages 243-281, Springer.
    2. de Brito, M.P. & Flapper, S.D.P. & Dekker, R., 2002. "Reverse logistics," Econometric Institute Research Papers EI 2002-21, Erasmus University Rotterdam, Erasmus School of Economics (ESE), Econometric Institute.
    3. Agrawal, Saurabh & Singh, Rajesh K. & Murtaza, Qasim, 2015. "A literature review and perspectives in reverse logistics," Resources, Conservation & Recycling, Elsevier, vol. 97(C), pages 76-92.
    4. Teunter, Ruud H. & Flapper, Simme Douwe P., 2011. "Optimal core acquisition and remanufacturing policies under uncertain core quality fractions," European Journal of Operational Research, Elsevier, vol. 210(2), pages 241-248, April.

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