Operations Research, Systems Engineering and Industrial Engineering Commons^™

Performance Based Contracting For The Manufacturing Industry By Using Integrated Platform And Dynamic Pricing Model, Lindawati, Aldy Gunawan

Research Collection Lee Kong Chian School Of Business

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. …