Improving the computational efficiency of metric-based spares algorithms
We propose a new heuristic algorithm to improve the computational efficiency of the general class of Multi-Echelon Technique for Recoverable Item Control (METRIC) problems. The objective of a METRIC-based decision problem is to systematically determine the location and quantity of spares that either maximizes the operational availability of a system subject to a budget constraint or minimizes its cost subject to an operational availability target. This type of sparing analysis has proven essential when analyzing the sustainment policies of large-scale, complex repairable systems such as those prevalent in the defense and aerospace industries. Additionally, the frequency of these sparing studies has recently increased as the adoption of performance-based logistics (PBL) has increased. PBL represents a class of business strategies that converts the recurring cost associated with maintenance, repair, and overhaul (MRO) into cost avoidance streams. Central to a PBL contract is a requirement to perform a business case analysis (BCA) and central to a BCA is the frequent need to use METRIC-based approaches to evaluate how a supplier and customer will engage in a performance based logistics arrangement where spares decisions are critical. Due to the size and frequency of the problem there exists a need to improve the efficiency of the computationally intensive METRIC-based solutions. We develop and validate a practical algorithm for improving the computational efficiency of a METRIC-based approach. The accuracy and effectiveness of the proposed algorithm are analyzed through a numerical study. The algorithm shows a 94% improvement in computational efficiency while maintaining 99.9% accuracy.
Volume (Year): 219 (2012)
Issue (Month): 2 ()
|Contact details of provider:|| Web page: http://www.elsevier.com/locate/eor|
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Sang-Hyun Kim & Morris A. Cohen & Serguei Netessine, 2007. "Performance Contracting in After-Sales Service Supply Chains," Management Science, INFORMS, vol. 53(12), pages 1843-1858, December.
- Lau, Hoong Chuin & Song, Huawei & See, Chuen Teck & Cheng, Siew Yen, 2006. "Evaluation of time-varying availability in multi-echelon spare parts systems with passivation," European Journal of Operational Research, Elsevier, vol. 170(1), pages 91-105, April.
- Angel Antonio Diaz, 2002. "Spare Parts And Maintenance Optimization In A Mobile Telephone Company," Working Papers Economia wp02-12, Instituto de Empresa, Area of Economic Environment.
- Wong, Hartanto & Cattrysse, Dirk & Van Oudheusden, Dirk, 2005. "Stocking decisions for repairable spare parts pooling in a multi-hub system," International Journal of Production Economics, Elsevier, vol. 93(1), pages 309-317, January.
- Kalchschmidt, Matteo & Zotteri, Giulio & Verganti, Roberto, 2003. "Inventory management in a multi-echelon spare parts supply chain," International Journal of Production Economics, Elsevier, vol. 81(1), pages 397-413, January.
- Rappold, James A. & Tchernev, Nikolay, 2009. "Special Issue on Supply Chain Design," European Journal of Operational Research, Elsevier, vol. 199(3), pages 732-733, December.
- Alfredsson, Patrik, 1997. "Optimization of multi-echelon repairable item inventory systems with simultaneous location of repair facilities," European Journal of Operational Research, Elsevier, vol. 99(3), pages 584-595, June.
- 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.
- 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.
- Margaret K. Schaefer, 1983. "A Multi-Item Maintenance Center Inventory Model for Low-Demand Reparable Items," Management Science, INFORMS, vol. 29(9), pages 1062-1068, September.
- Caggiano, Kathryn E. & Jackson, Peter L. & Muckstadt, John A. & Rappold, James A., 2009. "Efficient computation of time-based customer service levels in a multi-item, multi-echelon supply chain: A practical approach for inventory optimization," European Journal of Operational Research, Elsevier, vol. 199(3), pages 744-749, December.
- John A. Muckstadt & L. Joseph Thomas, 1980. "Are Multi-Echelon Inventory Methods Worth Implementing in Systems with Low-Demand-Rate Items?," Management Science, INFORMS, vol. 26(5), pages 483-494, May.
- Hurlimann, Werner, 1988. "An elementary proof of the Adelson--Panjer recursion formula," Insurance: Mathematics and Economics, Elsevier, vol. 7(1), pages 39-40, January.
- Rappold, James A. & Van Roo, Ben D., 2009. "Designing multi-echelon service parts networks with finite repair capacity," European Journal of Operational Research, Elsevier, vol. 199(3), pages 781-792, December.
When requesting a correction, please mention this item's handle: RePEc:eee:ejores:v:219:y:2012:i:2:p:324-334. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Dana Niculescu)
If references are entirely missing, you can add them using this form.