Replacement Models : Operation Research

In fact, in any system the efficacy (efficiency) of an item deteriorates with time. In such cases, either the old item should be replaced by a new item, or some kind of restorative action (maintenance) is necessary to restore the efficiency of the whole system.

The cost of maintenance depends upon a number of factors, and a stage comes at which the maintenance cost is so large that it is more profitable to replace the old item. Thus, there is a need to formulate the most effective replacement policy.

The purpose of this chapter is to show what replacement models look like.

Replacement models are concerned with the problem of replacement of machines, individuals, capital assets, etc. due to their deteriorating efficiency, failure, or breakdown.

It is evident that the study of replacement is a field of application rather than a method of analysis. Actually, it is concerned with methods of comparing alternative replacement policies.

The various types of replacement problems can be broadly classified in following categories:

• Replacement of items whose efficiency deteriorates with time, e.g., machine, tools, etc.
• Replacement of items that fail suddenly and completely like electric bulbs & tubes.
• Replacement of human beings in an organisation or staffing problem.
• Replacement of items may be necessary due to new researches and methods; otherwise, the system may become outdated.