SUPPLY AND DEPOT-REPAIR INTERACTIONS: A CASE STUDY OF ELECTRONICS SUPPORT.
RAND CORP SANTA MONICA CALIF
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This memorandum examines the relation between spares investment and the length of the depot repair-cycle. There is an economic tradeoff between supply-cost and depot repair-action, and it would pay to reduce the repair cycle as long as the supply-savings per unit-reduction remained greater than the cost of achieving the reduction. The procedure used to study the above tradeoff was to postulate a specific reduction in repair-cycle time, and balance the resultant supply-savings against the costs of achieving it. The study used a sample of 50 depot-reparable airborne fire-control spare items upon which to base the estimates of savings and costs. The results of the study demonstrate the importance of including the supply-cost implications of repair-cycle length as an explicit element in planning repair capability, and as a criterion of depot performance. Support costs are joint costs to judge depot performance on the sole basis of repair cost is far too narrow. The goal should be to achieve that mix of supply and maintenance resources which will minimize the joint costs. This study indicates that the potential savings to be realized by a more explicit consideration of this proper mix are not trivial, especially since this holds for all depot-reparable items.
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