A systemic approach for spare parts management in a performance based contract: a case study in the aviation domain

The supply of spare parts has a crucial role in maintenance activities, especially in industries with strict availability requirements. In the context of spare parts management, several strategies consist of taking advantage of cooperative or commercial agreements, moving from stand-alone scenarios to inventory pooling. The Performance Based Contracts (PBCs) represent valuable management strategies, based on the risk-pooling concept. This paper proposes an innovative analytic approach based on METRIC (Multi-Echelon Technique for Recoverable Item Control) to model a specific PBC. The paper explores the contracts according to the Supplier’s perspective in order to understand and quantify the effects of PBC on traditional inventory management. The model aims at defining technical contractual details that maximize the profit for the Supplier, respecting availability constraint and budget constraint of the Customers. A case study in the aviation domain, solved by a genetic algorithm, shows the outcomes of the model in a multi-echelon, multi-item, single-indenture system.