A primary objective for equipment managers is to replace the right equipment atthe right time and at the lowest overall cost. To help accomplish this task, a theoretically soundand practically feasible equipment replacement optimization methodology has been developed sothat a significant amount of money can potentially be saved. In this paper, the challenges andopportunities associated with equipment replacement decision making are discussed in detail.First, a comprehensive review of the state-of-the art and state-of-the practice literature on theequipment replacement optimization (ERO) problem is conducted. Second, the developed EROsoftware components and functionalities are presented. Third, several challenges faced by theresearch team during the ERO software development process are described including statisticalmodeling (purchase cost forecasting and down time cost estimating), optimization (in terms ofstochastic dynamic programming (SDP) and ERO under budget constraints), and softwareimplementation (particularly for the SDP approach) challenges. Detailed information as to howsuch challenges have been overcome and turned into opportunities using the current TexasDepartment of Transportation (TxDOT) data is also presented. Fourth, real opportunities and thepromising future for ERO decision making tools are discussed and supported by comprehensivenumerical results and their implications. Finally, a summary of the information presented anddetails about future research directions are also given.
展开▼
