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A minimum cost flow model for level of repair analysis

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  • Basten, R.J.I.
  • van der Heijden, M.C.
  • Schutten, J.M.J.

Abstract

Given a product design and a repair network for capital goods, a level of repair analysis determines for each component in the product (1) whether it should be discarded or repaired upon failure and (2) at which location in the repair network to do this. In this paper, we show how the problem can be modelled as a minimum cost flow problem with side constraints. Advantages are that (1) solving our model requires less computational effort than solving existing models and (2) we achieve a high model flexibility, i.e., many practical extensions can be added. Furthermore, we analyse the added value of modelling the exact structure of the repair network, instead of aggregating all data per echelon as is common in the literature. We show that in some cases, cost savings of over 7% can be achieved. We also show when it is sufficient to model the repair network by echelons only, which requires less input data.

Suggested Citation

  • Basten, R.J.I. & van der Heijden, M.C. & Schutten, J.M.J., 2011. "A minimum cost flow model for level of repair analysis," International Journal of Production Economics, Elsevier, vol. 133(1), pages 233-242, September.
    • Handle: RePEc:eee:proeco:v:133:y:2011:i:1:p:233-242
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    References listed on IDEAS

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    1. 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.
    2. Barros, Lilian & Riley, Michael, 2001. "A combinatorial approach to level of repair analysis," European Journal of Operational Research, Elsevier, vol. 129(2), pages 242-251, March.
    3. Brick, Eduardo Siqueira & Uchoa, Eduardo, 2009. "A facility location and installation of resources model for level of repair analysis," European Journal of Operational Research, Elsevier, vol. 192(2), pages 479-486, January.
    4. Murthy, D. N. P. & Solem, O. & Roren, T., 2004. "Product warranty logistics: Issues and challenges," European Journal of Operational Research, Elsevier, vol. 156(1), pages 110-126, July.
    5. R. Basten & J. Schutten & M. Heijden, 2009. "An efficient model formulation for level of repair analysis," Annals of Operations Research, Springer, vol. 172(1), pages 119-142, November.
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    Cited by:

    1. Patriarca, Riccardo & Costantino, Francesco & Di Gravio, Giulio & Tronci, Massimo, 2016. "Inventory optimization for a customer airline in a Performance Based Contract," Journal of Air Transport Management, Elsevier, vol. 57(C), pages 206-216.
    2. Yazdekhasti, Amin & sharifzadeh, Shila & Ma, Junfeng, 2022. "A two-echelon two-indenture warranty distribution network development and optimization under batch-ordering inventory policy," International Journal of Production Economics, Elsevier, vol. 249(C).
    3. R. Basten & M. Heijden & J. Schutten & E. Kutanoglu, 2015. "An approximate approach for the joint problem of level of repair analysis and spare parts stocking," Annals of Operations Research, Springer, vol. 224(1), pages 121-145, January.
    4. Ahmet Erkoyuncu, John & Khan, Samir & Hussain, Syed Mohammed Fazal & Roy, Rajkumar, 2016. "A framework to estimate the cost of No-Fault Found events," International Journal of Production Economics, Elsevier, vol. 173(C), pages 207-222.
    5. Parada Puig, J.E. & Basten, R.J.I., 2015. "Defining line replaceable units," European Journal of Operational Research, Elsevier, vol. 247(1), pages 310-320.
    6. Izack Cohen & Morris A. Cohen & Elad Landau, 2017. "On sourcing and stocking policies in a two-echelon, multiple location, repairable parts supply chain," Journal of the Operational Research Society, Palgrave Macmillan;The OR Society, vol. 68(6), pages 617-629, June.
    7. Basten, R.J.I. & van der Heijden, M.C. & Schutten, J.M.J., 2012. "Joint optimization of level of repair analysis and spare parts stocks," European Journal of Operational Research, Elsevier, vol. 222(3), pages 474-483.
    8. Ma, N., 2014. "Optimal scope of supply chain network & operations design," Other publications TiSEM e6187708-b664-44bf-aef8-f, Tilburg University, School of Economics and Management.

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