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Spares Calculator Terms

Here is a list of terms used throughout the Spares Calculator package.
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How to calculate the NFF Ratio

When using manufacturer NFF Ratios it is important to be clear how the NFF Ratio has been calculated.
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What is MTBSO?

In this article we explain the benefits of using a Mean Time Between Stock-Out (MTBSO) goal as opposed to using Stock-Out-Risk, Availability or Unavailability goals for spare parts optimisation.

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Converting availability goals for spare parts inventory

In this article we show how to convert the Probability of Availability to Stock-Out-Risk or Mean-Time-Between-Stock-Out for Spare Parts inventory.

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Spare Parts Optimization

The goal of Spare Parts Optimization is to maximize Operational Availability whilst minimizing Life Cycle Costs.

With this in mind, one of our customers recently asked:

The budgets of our customers are being continually slashed, yet they still want and need the same level of spare parts support. Is there a way of using Spares Calculator to help them spend their money more wisely so that they get the best spare parts ranging and scaling package within their budget?

This is a good question and the answer is obviously yes, but you need to be careful that you don’t end up being pressurized into promising unrealistic service levels. Here are some ideas that might help you achieve the same levels of risk at a reduced cost.

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How to Calculate Spare Parts with a Discard on Failure Repair Policy

Many items in a typical inventory do not actually get repaired and they are simply discarded on failure. These are known as items with a discard on failure repair policy. A customer recently asked:

How should I model with items that have a discard on failure repair policy in Spares Calculator?

Discussion

The short answer to this question is that the repair policy does not affect the calculation. What matters is how long it takes to replace the part. Spares Calculator is based on the Poisson distribution which is used to forecast the projected number of events that might occur when you actually expect something else.

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How to Establish Stock-Out-Risk Goals

Here is an example of a recent question that we were asked by a client.

I have a unit that with a lifetime of 10 years and I want zero stock-out-risk. How many spare parts should I recommend?

The short answer to this is infinity spare parts. Only infinity spare parts could achieve a zero per cent stock-out-risk. Obviously this isn’t very helpful and therefore we need to strike a compromise. But how much risk should you accept?

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How to Calculate a Spare Parts Lifetime Buy?

Spare parts obsolescence and redundancy are an important factor in managing the lifecycle of a typical high value system. Electronic components typically have short production lifecycles, typically 2-5 years and even military suppliers have difficulty maintaining production past this point without special government funding.

Here is a question that was recently asked by one of our customers:

1) I have an item that will not be repaired nor is there a possibility the item can get resupplied from the vendor, nor will it get tested for faults, so I believe the No Fault Find Ratio and repair turnaround time is not relevant in my situation.

2) When the item fails a new item will be issued from stores and the failed item will not get tested nor will the item get replaced.  I need to find out what the ideal sparing is based on no testing, no resupply and no repair for item.

3) Adjusting the No Fault Find Ratio and Repair Turn Around Times adjusts my recommended spares level, what should I put into the model to indicate a  no testing, no resupply, no repair inventory management policy?

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Spares Calculator helps a global manufacturer to optimize their spare parts deployments, maximize system availability and minimize their through life costs.

Is it possible to maximize system availability and minimize through life costs? According to a Fortune-500 global manufacturing company it can. A few years ago the company’s 6-sigma team became aware of Spares Calculator and decided to run a trial. The results showed that all of their sites were over-stocking on certain line items and under-stocking on others.

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Spares Calculator provides the scientific justification needed to support a military spare parts order worth more than $3,000,000

A supplier of military equipment was asked to bid for a large naval retrofit program. During the tender evaluation process the supplier received a clarification request from the customer which stated:

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