A finite horizon model for repairable systems with repair restrictions

In this paper, we will present a new finite horizon repair/replacement decision model and derive the structure of the optimal policy for components that have a failure intensity that is a non–decreasing function of the number of times the component has been repaired, and independent of the component's age. Furthermore, the component has physical restrictions on the number of times it can be repaired, after which the only feasible decision is to replace the component. The fundamentals of this new decision model are based on the outcomes of several case studies done by the authors. Besides presenting the model and showing the structure of the optimal policy, the model will be applied to a real industry data set, and its results discussed.