Publication Type

Conference Proceeding Article

Version

acceptedVersion

Publication Date

1-2016

Abstract

Although Performance Based Contracting (PBC) concept is not totally new, the PBC adaptation in Industrial Machinery and Components (IMC) manufacturing, which produces high-value and long life machineries, is rather slow and it is done with extra caution. Three main concerns for manufacturers to implement PBC are the investment cost, the maintenance cost and possible revenue loss. To handle these concerns and accelerate the PBC implementation, we propose an integrated platform that consists of three components: dynamic pricing, sensor data feeding and machinery monitoring. We model the dynamic pricing as an optimization problem and propose Genetic Algorithm to solve the problem. We run the experiment on generated data and show that GA provides a good pricing solution with average difference of 5.64% from the traditional fixed leasing price.

Keywords

dynamic pricing, genetic algorithm, industrial machinery and components manufacturing, integrated platform, performance based contracting

Discipline

Operations Research, Systems Engineering and Industrial Engineering | Theory and Algorithms

Research Areas

Intelligent Systems and Optimization

Publication

2015 IEEE International Conference on Industrial Engineering and Engineering Management (IEEM): Singapore, December 6-9: Proceedings

First Page

1578

Last Page

1582

ISBN

9781467380669

Identifier

10.1109/IEEM.2015.7385913

Publisher

IEEE

City or Country

Piscataway, NJ

Copyright Owner and License

Authors

Additional URL

https://doi.org/10.1109/IEEM.2015.7385913

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