Replacement Decisions with Maintenance Under Uncertainty: An Imbedded Optimal Control Model

Authors:
Ali Dogramaci;Nelson M. Fraiman
Affiliations:
Department of Industrial Engineering, Bilkent University, Ankara 06800, Turkey;Graduate School of Business, Columbia University, New York, New York 10027
Venue:
Operations Research
Year:
2004

Citing 4
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Abstract

How should a manager make replacement decisions for a chain of machines over time if each is maintained by an optimal control model addressing uncertainty of machine breakdowns? A network representation of the problem involves arcs with interdependent costs. A solution algorithm is presented and replacement considerations under technological change are incorporated into a well-known optimal control model for maintenance under uncertainty (that of Kamien and Schwartz 1971). The method is illustrated by an example.