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Static Repair Priorities

  • Geert-Jan van Houtum
  • Bram Kranenburg
Part of the International Series in Operations Research & Management Science book series (ISOR, volume 227)

Abstract

In this chapter, we study a multi-item, single-location inventory model with a capacitated repair shop. The repair shop is modeled as a single exponential server. This is not realistic in general, but leads to a fair way of studying the effect of setting static priorities in the repair shop. The idea is that total costs can be reduced when expensive repairable parts get a high priority and relatively low basestock levels (leading to a strong decrease in costs) and cheap repairable parts get a low priority and relatively high basestock levels (leading to a limited increase in costs). We derive an exact evaluation method under a given priority setting and given basestock levels. Next, we show that the basestock levels can easily be optimized under a given priority assignment. Finally, we give an exact method and multiple heuristic methods for the priority assignment. We show that the use of static priorities, in comparison to having no priorities, leads to a large reduction (40 % or more) in total costs in many instances. We also show that two priority classes suffice to obtain 90 % of the maximal savings via static priorities.

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Copyright information

© Springer Science+Business Media New York 2015

Authors and Affiliations

  • Geert-Jan van Houtum
    • 1
  • Bram Kranenburg
    • 2
  1. 1.Eindhoven University of TechnologyEindhovenThe Netherlands
  2. 2.Consultants in Quantitative Methods CQM B.V.EindhovenThe Netherlands

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