Production planning model with simultaneous production of spare parts

Abstract

The paper presents, proposed by the authors, a production planning model with simultaneous production of identical components for the need of own assembly and as spare parts in machine industry plants. The model was based on literature studies and the authors’ own conclusions drawn during the research works carried out in Grundfos Pompy Ltd. The proposed production planning model has been based on the classical stock management theory and material requirement planning methods. It results in merging production management and stock management in a one coherent material flow management system. The evaluation of the proposed model was made based on its empirical verification in the environment of the machine industry plant mentioned above. The results turned out to be very promising – the value of spare parts stock was reduced by nearly 50%.

Keywords:

• production planning
• spare parts
• inventory management
• decoupling point
• material requirement planning

Acknowledgements

This paper has been supported thanks to collaboration between Poznan University of Technology, Institute of Logistics and Warehousing from Poznan and Grundfos Pompy Ltd.

Notes

Notes

1. Based on the research carried out by the authors of the article.

2. In case of low frequency issues values of parameters y ₁ and y ₂ should comprise longer periods (e.g. y ₁ = one month and y ₂ = 3 months (or 2 months)). In case of frequent issues the parameters should comprise shorter periods considering planning units used in the main schedule (e.g. y ₁ = one week and y ₂ = one month).

3. The Delphi method is based on a structured process for collecting and distilling knowledge from a group of experts by means of a series of questionnaires interspersed with controlled opinion feedback (Adler and Ziglio 1996). Linstone and Turoff (1975) say that Delphi may be characterised as a method for structuring a group communication process so that the process is effective in allowing a group of individuals, as a whole, to deal with a complex problem. The method takes its name from the Oracle at Delphi, an ancient Greek soothsayer able to predict the future, and was originally developed at the RAND Corporation by Dalkey and Helmer (1963) as a tool for forecasting likely inventions, new technologies and the social and economic impact of technological change.