Optimal multi-criterion contracting framework for system-support-service under risk-transfer effect

• Main Authors: Jong-Jang Lin, 林仲璋
• Other Authors: Ruey-Huei Yeh
• Format: Others
• Language: en_US
• Published: 2017
• Online Access: http://ndltd.ncl.edu.tw/handle/m87e4v

博士 === 國立臺灣科技大學 === 工業管理系 === 105 === The system-support service (maintenance, repair, and overhaul) constitutes a significant portion of the industrial economy as engineered systems, such as jet engines, have becoming progressively expensive and complex to satisfy ever-increasing operational demands. Recently, a new performance-based contracting (PBC) strategy has been observed across both service and manufacturing industries. However, extant literature on PBC strategies has generally overlooked an in-depth analysis of the risk-transfer effect, service profits, and incentive mechanisms considering maintenance policy. This dissertation overcomes the limitations in extant PBC strategy-related literature by proposing a risk-based, multi-performance criterion-contracting (MPC) framework from the perspective of the principal (customer). Further, this dissertation demonstrates how the MPC framework is effectively applied in a practical jet engine support service case, and derives managerial insights. The case analysis results indicate that the incentive mechanism must simultaneously exist in both the incentive and punishment terms to obtain a maximum risk-transfer effect. This dissertation’s contributions are threefold: First, it develops a theoretical MPC framework to study the aforementioned issues and analyze risk-transfer effects. Second, it distinguishes the managerial issues arising among incentive mechanisms, cost reductions, and inner-controlling variances. Finally, it proposes insights that aid managerial decisions and provides policy recommendations.