Dr. Sarah Van der Auweraer, full-time postdoctoral researcher at the Luxembourg Centre for Logistics and Supply Chain Management, has recently published a paper titled “The Value of Installed Base Information for Spare Part Inventory Control” in the International Journal of Production Economics. In the paper, she analyses the value of different sources of installed base information for spare part demand forecasting and inventory control.
Summary of the research
The installed base is defined as the set of products (or machines) in use where the part is installed. Information on the number of products still in use, the age of the products, the age of their parts, as well as the part reliability may indicate when a part will fail and trigger a demand for a new spare part.
The current literature is unclear which of this installed base information adds most value -and should thus be collected- for inventory control purposes. For this reason, we evaluate the inventory performance of eight methods that include different sets of installed base information in their demand forecasts.
Using a comparative simulation study, we identify that knowing the size of the active installed base is most valuable, especially when the installed base changes over time. We also find that when a failure-based prediction model is used, it is important to work with the part age itself, rather than the machine age.
When one is not able to collect information on the part age, a logistic regression on the machine age might be a valuable alternative to a failure-based prediction model. Our findings may support the prioritisation of data collection for spare part demand forecasting and inventory control.
About Sarah
Before Sarah pursued a PhD in Applied Economics, she completed a Master’s degree in Business Engineering with a major in Production and Logistics Management at the KU Leuven.
After she joined the LCL in October 2019, she defended her PhD, titled “Spare part inventory management using Service Maintenance Information”, which was conducted in close cooperation with an industrial partner.
Her research focuses on Business Analytics, Operations Management, Forecasting and Service Logistics.
The LCL is very proud of the cutting-edge research work performed by Dr. Sarah Van der Auweraer.