Logistics optimization for service contract fulfillment of capital goods

Description of research

In today’s environment, it is important for suppliers of capital goods (like medical systems and defense systems) to provide customers with services for system upkeep during the product life cycle next to the physical system itself. Therefore, suppliers increasingly provide service contracts to their customers. In such contracts, the supplier specifies the service activities that it provides to the customer for the upkeep of the customer’s systems and the price that the customer pays for these services. In addition, service contracts may contain guarantees on performance in terms of operational uptime and reaction speed in case the system is down. Of course, different customers may want different levels of guarantees and therefore pay different prices (high guarantees are more expensive).

The systems to be served constitute an installed based that is usually dispersed over a large geographical area (often worldwide). Therefore, an extensive service network is necessary. The task of service logistics is to organize logistics such that the supplier is able to meet the requirements of a set of service contracts at low costs. In organizing logistics, the supplier should be able to differentiate its service activities to the different service requirements of its customers. Possibilities for customer differentiation are, amongst others, the reservation of spare part inventories for high priority demand and priority settings in service engineer allocation. In this research, we will study how we should use such options for efficient service contract fulfillment. To this end, we will develop optimization models to find (near) optimal control policies. We will test our models and methods in case studies at several companies participating in the Service Logistics Forum Research program in which this project is embedded.

Advisor(s)

Prof.dr. Henk Zijm

Dr. M.C. van der Heijden

Duration

2008 - 2012

Project

Customer Differentiation in Service Logistics

Funding institution

SLF-R (Service Logistics Forum Research)

Strategic Research Orientation

Industrial Engineering & ICT

Links to relevant web pages:

http://www.utwente.nl/mb/ompl/

http://www.servicelogisticsforum.nl/

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Home CTIT symposium 2013 About CTIT News NIRICT Research Meet the PhDs Working at CTIT Internal Information Conferences Open Calls (updated May 3, 2013) Library and Videos Knowledge Transfer Links Sitemap Search	Logistics optimization for service contract fulfillment of capital goods Description of research In today’s environment, it is important for suppliers of capital goods (like medical systems and defense systems) to provide customers with services for system upkeep during the product life cycle next to the physical system itself. Therefore, suppliers increasingly provide service contracts to their customers. In such contracts, the supplier specifies the service activities that it provides to the customer for the upkeep of the customer’s systems and the price that the customer pays for these services. In addition, service contracts may contain guarantees on performance in terms of operational uptime and reaction speed in case the system is down. Of course, different customers may want different levels of guarantees and therefore pay different prices (high guarantees are more expensive). The systems to be served constitute an installed based that is usually dispersed over a large geographical area (often worldwide). Therefore, an extensive service network is necessary. The task of service logistics is to organize logistics such that the supplier is able to meet the requirements of a set of service contracts at low costs. In organizing logistics, the supplier should be able to differentiate its service activities to the different service requirements of its customers. Possibilities for customer differentiation are, amongst others, the reservation of spare part inventories for high priority demand and priority settings in service engineer allocation. In this research, we will study how we should use such options for efficient service contract fulfillment. To this end, we will develop optimization models to find (near) optimal control policies. We will test our models and methods in case studies at several companies participating in the Service Logistics Forum Research program in which this project is embedded. Advisor(s) Prof.dr. Henk Zijm Dr. M.C. van der Heijden Duration 2008 - 2012 Project Customer Differentiation in Service Logistics Funding institution SLF-R (Service Logistics Forum Research) Strategic Research Orientation Industrial Engineering & ICT Links to relevant web pages: http://www.utwente.nl/mb/ompl/ http://www.servicelogisticsforum.nl/ Picture