Maintenance optimal control three-machine replacement model under technological breakthrough expectations (Q1331126)

This paper addresses a finite-horizon profit maximization three-machine replacement problem under uncertainty regarding the introduction time of a machine with a not-yet-achieved technology, given an exponential probability distribution function of the introduction time. A model is formulated allowing for preventive maintenance to slow down machine quality and profit reduction caused by obsolescence, to determine the timing of replacing an existing machine by another available machine with improved technology. To deal with a real-world structure, three types of technologies are considered: type 1, the existing or used one; type 2, an improved available technology that can be purchased to replace a machine of type 1; and type 3, the not-yet-achieved technology. For the three-machine problem, it is realized that, if it is optimal to replace a machine of type 1 by a machine of type 2 early enough at \(t_ 2\), then a null preventive maintenance policy should be employed. Otherwise, a complete preventive policy is employed up to \(t(t_ 2)\) and then a null preventive policy is optimal. Unlike the linear relationship between the switching and the planning horizon for the single-machine problem, \(t(t_ 2)\) is concave increasing in \(t_ 2\). This result indicates that the replacement time cannot be viewed as a planning horizon for the determination of the switching point, or the exact structure of a bang-bang preventive solution cannot be constructed according to a single-machine problem. Further important engineering and management applications of the model are also given in the paper.