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Optimization and decision-making for a service contract on machine maintenance
LUO Zeyu1; YANG Zhixin1; WU Jinbiao3; LIAN ZHAOTONG2
2024-12
Source PublicationOperations Research and Decisions
ISSN2081-8858
Volume34Issue:4Pages:89-101
Abstract

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.

KeywordService Contract Reliability Queueing System Optimization Game Theory
Indexed ByESCI
WOS Research AreaOperations Research & Management Science
WOS SubjectOperations Research & Management Science
WOS IDWOS:001383266300006
PublisherWROCLAW UNIV SCIENCE & TECHNOLOGY, FAC MANAGEMENT, WYBRZEZE WYSPIANSKIEGO 27, WROCLAW 50-370, POLAND
Scopus ID2-s2.0-85213029168
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Citation statistics
Document TypeJournal article
CollectionDEPARTMENT OF ELECTROMECHANICAL ENGINEERING
DEPARTMENT OF ACCOUNTING AND INFORMATION MANAGEMENT
Corresponding AuthorLIAN ZHAOTONG
Affiliation1.Faculty of Science and Technology, University of Macau, Macao
2.School of Mathematics and Statistics, Central South University, Hunan, Changsha, 410075, China
3.Faculty of Business Administration, University of Macau, Macao
First Author AffilicationFaculty of Science and Technology
Recommended Citation
GB/T 7714
LUO Zeyu,YANG Zhixin,WU Jinbiao,et al. Optimization and decision-making for a service contract on machine maintenance[J]. Operations Research and Decisions, 2024, 34(4), 89-101.
APA LUO Zeyu., YANG Zhixin., WU Jinbiao., & LIAN ZHAOTONG (2024). Optimization and decision-making for a service contract on machine maintenance. Operations Research and Decisions, 34(4), 89-101.
MLA LUO Zeyu,et al."Optimization and decision-making for a service contract on machine maintenance".Operations Research and Decisions 34.4(2024):89-101.
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