A Two-dimensional Warranty Model with Consideration of Customer and Manufacturer Objectives Solved with Non-dominated Sorting Genetic Algorithm
محورهای موضوعی : Design of Experiment
Amin Asadi
1
,
Mohammad Saidi-Mehrabad
2
,
Faranak Fathi Aghdam
3
1 - M.Sc., Industrial Engineering Department, Iran University of Science and Technology, Tehran, Iran
2 - Professor, Industrial Engineering Department, Iran University of Science and Technology, Tehran, Iran
3 - Research Assistant, Systems and Industrial Engineering Department, University of Arizona, Tuscan, Arizona, USA
کلید واژه: NSGA-II, Two dimensional warranty, utility function, Warranty cost, Bi-objective model,
چکیده مقاله :
Warranty is a powerful implement for marketing strategy that is used by manufacturersand creates satisfaction for consumers by ensuring to compensate for incorrect operation of the product. Warranty serviceresults ina cost named warranty cost for a manufacturer.This cost is a function of warranty policy, regions, and product failures pattern. Since this service coversthe cost of uncertain failure of the product, it makes some utility for customers. In this paper, we developed a novel customer utility function that is used as a customer objective to be maximized. In addition to the manufacturer objective, minimizing the warranty costisconsidered simultaneously. There are four restrictions on warranty parameters such as time, usage, unit product price and the R&D expenditure to be considered. Finally, we will propose a novel bi-objective model that maximizesthe utility function for customers and minimizesthe warranty cost for the manufacturer. This model will be solved with an evolutionary algorithmcalled Non-Dominated Sorting Genetic Algorithm (NSGA-II) and non-dominated Pareto solutionswill be gained from this method.To give a numerical instance, for a certain usage rate’s range of costumers, different warranties are provided and compared. It is believed that the computational results can help manufacturers to determine optimal solutions for the objective functions and consequentlywarranty parameters.
Mitra,A.,Patankar,J.(2010) .Two-attribute warranty policies under consumer preferences of usage and claims execution.Advances in Business and Management Forecasting, Volume 6,Emerald Group Publishing Limited,217-235
Chun, Y. H., Tang, K. (1999). Cost analysis of two-attribute warranty policies based on product usage rate. IEEE Transaction on engineering management, Vol. 46, No. 2,201-209
Kim, H. G.,Rao, B. M. (2000). Expected warranty cost of two-attribute free replacement warranties based on a bivariate exponential distribution. Computers and IndustrialEngineering, 38, 425–434.
Manna, D.K, Pal, S., Sinha, S. (2006). Optimal determination of warranty region for 2D policy: A customers’ perspective. Computers & Industrial Engineering, 50, 161–174
Blischke, W. R., Murthy, D. N. P. (1994).Warranty cost analysis.first edition,Springer series in reliability engineering, London
Zhou, Z, Li, Y., Tang, K.(2009). Dynamic pricing and warranty policies for products with fixed lifetime. European Journal of Operational Research, 196, 940–948
Murthy, D. N. P., Djamaludin, I. (2002). New product warranty: A literature review. International Journal of Production Economics, 79(3),231–260.
Deb,K.,Pratap,A.,Agarwa, S., Meyarivan,T. (2002).A Fast and Elitist Multiobjective Genetic Algorithm. IEEE TRANSACTIONS ON EVOLUTIONARY COMPUTATION, VOL. 6, NO.2
Tong, P., Liu, Z., Men, F., Cao, L. (2014). Designing and pricing of two-dimensional extended warranty contracts based on usage. International Journal of Production Research, VOL. 52, NO.21
Mitra, A., Patankar, J. (2011).A Multi-objective Model for Warranty Policies Integrating Product Quality, Market Share, and R&D Expenditure. Advances in Business and Management Forecasting, Volume 8, Emerald Group Publishing Limited, 43-65
