Optimization and Decision-Making for a Service Contract on Machine Maintenance
We investigate a novel maintenance service contract model. The service provider of the machine must determine the optimal pricing structure and staffing levels, while the client selects an appropriate plan for the warranty duration. We consider linear, quadratic, polynomial, and exponential pricing...
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| Main Authors: | , , , |
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| Format: | Article |
| Language: | English |
| Published: |
Wrocław University of Science and Technology
2024-01-01
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| Series: | Operations Research and Decisions |
| Online Access: | https://ord.pwr.edu.pl/assets/papers_archive/ord2024vol34no4_6.pdf |
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| _version_ | 1849428299965530112 |
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| author | Zeyu Luo Zhixin Yang Jinbiao Wu Zhaotong Lian |
| author_facet | Zeyu Luo Zhixin Yang Jinbiao Wu Zhaotong Lian |
| author_sort | Zeyu Luo |
| collection | DOAJ |
| description | We investigate a novel maintenance service contract model. The service provider of the machine must determine the optimal pricing structure and staffing levels, while the client selects an appropriate plan for the warranty duration. We consider linear, quadratic, polynomial, and exponential pricing functions for three types of warranties. By building a service model with a non-cooperative game, we obtain the Nash equilibrium of the bargaining solution. Numerical analysis reveals that the optimal warranty period decreases monotonically with service provider revenue and increases monotonically with the maximum prospective service time. Additionally, the market size does not affect the ideal warranty duration when the machine's lifetime is constant. (original abstract) |
| format | Article |
| id | doaj-art-9183c226bd26447bbfd24d5fbc5733e6 |
| institution | Kabale University |
| issn | 2081-8858 2391-6060 |
| language | English |
| publishDate | 2024-01-01 |
| publisher | Wrocław University of Science and Technology |
| record_format | Article |
| series | Operations Research and Decisions |
| spelling | doaj-art-9183c226bd26447bbfd24d5fbc5733e62025-08-20T03:28:44ZengWrocław University of Science and TechnologyOperations Research and Decisions2081-88582391-60602024-01-01vol. 34no. 489101171702564Optimization and Decision-Making for a Service Contract on Machine MaintenanceZeyu Luo0Zhixin Yang1Jinbiao Wu2Zhaotong Lian3University of Macau, ChinaUniversity of Macau, ChinaUniversity of Macau, ChinaCentral South University, Hunan, ChinaWe investigate a novel maintenance service contract model. The service provider of the machine must determine the optimal pricing structure and staffing levels, while the client selects an appropriate plan for the warranty duration. We consider linear, quadratic, polynomial, and exponential pricing functions for three types of warranties. By building a service model with a non-cooperative game, we obtain the Nash equilibrium of the bargaining solution. Numerical analysis reveals that the optimal warranty period decreases monotonically with service provider revenue and increases monotonically with the maximum prospective service time. Additionally, the market size does not affect the ideal warranty duration when the machine's lifetime is constant. (original abstract)https://ord.pwr.edu.pl/assets/papers_archive/ord2024vol34no4_6.pdf |
| spellingShingle | Zeyu Luo Zhixin Yang Jinbiao Wu Zhaotong Lian Optimization and Decision-Making for a Service Contract on Machine Maintenance Operations Research and Decisions |
| title | Optimization and Decision-Making for a Service Contract on Machine Maintenance |
| title_full | Optimization and Decision-Making for a Service Contract on Machine Maintenance |
| title_fullStr | Optimization and Decision-Making for a Service Contract on Machine Maintenance |
| title_full_unstemmed | Optimization and Decision-Making for a Service Contract on Machine Maintenance |
| title_short | Optimization and Decision-Making for a Service Contract on Machine Maintenance |
| title_sort | optimization and decision making for a service contract on machine maintenance |
| url | https://ord.pwr.edu.pl/assets/papers_archive/ord2024vol34no4_6.pdf |
| work_keys_str_mv | AT zeyuluo optimizationanddecisionmakingforaservicecontractonmachinemaintenance AT zhixinyang optimizationanddecisionmakingforaservicecontractonmachinemaintenance AT jinbiaowu optimizationanddecisionmakingforaservicecontractonmachinemaintenance AT zhaotonglian optimizationanddecisionmakingforaservicecontractonmachinemaintenance |