Cost Modelling to Support Optimum Selection of Life Extension Strategy for Industrial Equipment in Smart Manufacturing

Nasser Amaitik (), Ming Zhang (), Zezhong Wang (), Yuchun Xu (), Gareth Thomson (), Yiyong Xiao (), Nikolaos Kolokas (), Alexander Maisuradze (), Oscar Garcia (), Michael Peschl () and Dimitrios Tzovaras ()
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Nasser Amaitik: Aston University
Ming Zhang: Aston University
Zezhong Wang: Aston University
Yuchun Xu: Aston University
Gareth Thomson: Aston University
Yiyong Xiao: Beihang University
Nikolaos Kolokas: Centre for Research and Technology Hellas
Alexander Maisuradze: Harms & Wende GmbH & Co. KG
Oscar Garcia: Information Catalyst of Enterprises
Michael Peschl: Harms & Wende GmbH & Co. KG
Dimitrios Tzovaras: Centre for Research and Technology Hellas

Circular Economy and Sustainability, 2022, vol. 2, issue 4, 1425-1444

Abstract: Abstract Industrial equipment/machinery is an important element of manufacturing. They are used for producing objects that people need for everyday use. Therefore, there is a challenge to adopt effective maintenance strategies to keep them well-functioning and well-maintained in production lines. This will save energy and materials and contribute genuinely to the circular economy and creating value. Remanufacturing or refurbishment is one of the strategies to extend life of such industrial equipment. The paper presents an initial framework of cost estimation model based on combination of activity-based costing (ABC) and human expertise to assist the decision-making on best life extension strategy (e.g. remanufacturing, refurbishment, repair) for industrial equipment. Firstly, ABC cost model is developed to calculate cost of life extension strategy to be used as a benchmark strategy. Next, expert opinions are employed to modify data of benchmark strategy, which is then used to estimate costs of other life extension strategies. The developed cost model has been implemented in VBA-based Excel® platform. A case study with application examples has been used to demonstrate the results of the initial cost model developed and its applicability in estimating and analysing cost of applying life extension strategy for industrial equipment. Finally, conclusions on the developed cost model have been reported.

Keywords: Circular economy; Remanufacturing; Refurbishment; Life extension strategy; Industrial equipment; Cost modelling; Decision-making; Maintenance; Asset management (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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DOI: 10.1007/s43615-022-00154-0

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