Book Presentation, 21 September 2015
History 1436
Arsenal of Venice: Use of standard parts for warschips
1785
Honoré Blanc: • French gunsmith • Musket assembled from interchangeable components • Adopted by US Government (Jefferson)
1968
Craig Sherbooke: • METRIC model • Paper in Operations Research • Worked at The Rand Corporation • 1992: Sherbrooke’s book
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METRIC Model Local Warehouse
0
N
Tradeoff 1: Central vs. local stock
Installed machines
•••
Repair of spare parts
Central Warehouse
1
Installed machines
Local Warehouse
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METRIC Model System Availability 1
System approach !!! Tradeoff 2: Cheap vs. expensive SKU’s
0
Total investment in spare parts
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1971: Multi-indenture structure (also introduced by Sherbrooke)
Fire Extinguishing System
Pump unit 1 1
Pump 3
Seal 6
Casing 7
Pump unit 2 2
El.mo. 4
Bearing 8
Rotor 9
Pump 3
Stator 10
El.mo 5
Rotor 11
Stator 12
Tradeoff 3: Higher-level vs. lower level SKU’s
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Case results (Rustenburg, PhD thesis, 2000; Rustenburg, van Houtum, and Zijm, 2003)
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PhD Project Kranenburg (2002-2006) Customer Support Network ASML
New features: • Lateral transshipments • Emergency shipments • Customer differentiation 19-9-2015
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Graphical representation Supply
Central warehouse(s)
Supply of new parts
Local warehouses
Installed base
Lateral transshipments
Repair shops
1 hrs
Emergency shipments
2 hrs 4 hrs
Service differentiation
/ School of Industrial Engineering
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Case ASML: Effect lateral transshipments • 19 local warehouse in the US • 1451 SKU’s Lateral Lateral transshipments transshipments at operational at tactical level level
Inventory holding and transportation costs
Scenario 1
no
no
100 (Normalized)
Scenario 2
yes
no
73
Scenario 3 (with our model)
yes
yes
50
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Overview book Chapters: 1. Introduction 2. Basic Multi-Item, Single-Location Inventory Model 3. Multiple Machine Types with Commonality 4. Service Differentiation 5. Multi-location System with Lateral Transshipments 6. Two-Echelon System (backordering) 7. Multi-Echelon, Multi-Indenture System (backordering) 8. Static Repair Capacities
With emergency shipments
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Overview book Chapters: 1. Introduction 2. Basic Multi-Item, Single-Location Inventory • Chapters are building blocks Model With 3. Multiple Machine Types with Commonality • Real-life networks: emergency 4. Service Differentiation Design a solution based shipments 5. Multi-location System with Lateral on these building blocks Transshipments 6. Two-Echelon System (backordering) 7. Multi-Echelon, Multi-Indenture System (backordering) 8. Static Repair Capacities 19-9-2015
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Spare parts books 1992
Book Sherbrooke: • Motivation: Military world • Tactical planning • System approach • METRIC Model • Multi-indenture (538 citations in GS; 993 citations for 1968 paper) Implemented in commercial software packages
2005
Book Muckstadt: • Motivation: Military world • Tactical planning • System approach • METRIC Model • Multi-indenture • Lateral transsh. cf. Axsäter [1990] (full pooling, no emerg. sh.) • One chapter on operational planning (204 citations in GS)
2015
Book Van Houtum and Kranenburg: • Motivation: High-tech industry • Tactical planning • System approach • METRIC Model • Multi-indenture • Emergency shipments • Customer differentiation • Lateral transshipments
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