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Optimal maintenance and replacement decisions under technological change with consideration of spare parts inventories

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  • Nguyen, T.P. Khanh
  • Yeung, Thomas G.
  • Castanier, Bruno

Abstract

Classical spare parts inventory models assume that the same vintage of technology will be utilized throughout the planning horizon. However, asset replacement often occurs in the form of a new technology that renders existing spare parts inventories obsolete. This paper aims to study the impact of spare parts inventory on equipment maintenance and replacement decisions under technological change via a Markov decision process formulation. The replacement decision is complex in that one must decide with which technology available on the market to replace the current asset. Under technological change, it is shown that the do nothing and repair options have significantly more value as they allow waiting the appearance of even better technologies in the future.

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  • Nguyen, T.P. Khanh & Yeung, Thomas G. & Castanier, Bruno, 2013. "Optimal maintenance and replacement decisions under technological change with consideration of spare parts inventories," International Journal of Production Economics, Elsevier, vol. 143(2), pages 472-477.
    • Handle: RePEc:eee:proeco:v:143:y:2013:i:2:p:472-477
    DOI: 10.1016/j.ijpe.2012.12.003
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    Cited by:

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    3. Yan, Tao & Lei, Yaguo & Wang, Biao & Han, Tianyu & Si, Xiaosheng & Li, Naipeng, 2020. "Joint maintenance and spare parts inventory optimization for multi-unit systems considering imperfect maintenance actions," Reliability Engineering and System Safety, Elsevier, vol. 202(C).
    4. Stutzman, Sarah & Weiland, Brandon & Preckel, Paul & Wetzstein, Michael, 2017. "Optimal replacement policies for an uncertain rejuvenated asset," International Journal of Production Economics, Elsevier, vol. 185(C), pages 21-33.
    5. Yatsenko, Yuri & Hritonenko, Natali, 2015. "Algorithms for asset replacement under limited technological forecast," International Journal of Production Economics, Elsevier, vol. 160(C), pages 26-33.
    6. Yatsenko, Yuri & Hritonenko, Natali, 2017. "Machine replacement under evolving deterministic and stochastic costs," International Journal of Production Economics, Elsevier, vol. 193(C), pages 491-501.
    7. Wakiru, James M. & Pintelon, Liliane & Muchiri, Peter N. & Chemweno, Peter K., 2019. "A simulation-based optimization approach evaluating maintenance and spare parts demand interaction effects," International Journal of Production Economics, Elsevier, vol. 208(C), pages 329-342.
    8. Yuri Yatsenko & Natali Hritonenko, 2016. "Asset replacement under improving operating and capital costs: a practical approach," International Journal of Production Research, Taylor & Francis Journals, vol. 54(10), pages 2922-2933, May.
    9. Mellal, Mohamed Arezki, 2020. "Obsolescence – A review of the literature," Technology in Society, Elsevier, vol. 63(C).
    10. Öner, K.B. & Kiesmüller, G.P. & van Houtum, G.J., 2015. "On the upgrading policy after the redesign of a component for reliability improvement," European Journal of Operational Research, Elsevier, vol. 244(3), pages 867-880.

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