Joint Production and Spare Part Inventory Control Strategy Driven by Condition Based Maintenance

Throughput of a manufacturing process depends on the effectiveness of equipment maintenance, and the availability of spare(service) parts. This paper addresses a joint production and spare part inventory control strategy driven by condition based maintenance(CBM) for a piece of manufacturing equipment. Specifically, a critical unit is continuously monitored for performance degradation during operation. The amount of degradation is utilized to initiate replacement actions in conjunction with spare part inventory control under both production lot size, and due date constraints. A degradation limit maintenance policy is combined with a base stock spare part inventory control policy to manage the manufacturing process. The objectives are to minimize the spare part inventory, and the expected total operating cost. Constrained least squares approximation, and simulation-based optimization are utilized, in a heuristic two-step approach, to determine the optimal base-stock level of spare parts, along with the preventive maintenance threshold. The resulting joint decision ascertains the allowed stockout probability for spare parts, while incurring the minimal operating cost for the required production within a fixed production duration. A case study of an automotive engine manufacturing process is provided to demonstrate the proposed decision-making methodology in practical use.