Case study: Stock-up strategy for equipment with High-Lead-Time spares in offshore substations

Therefore, it was deemed relevant to compare reactive and proactive methods under a realistic scenario to understand this apparent contradiction. This becomes more relevant when supply chain constraints, such as equipment entering limited or obsolete phases, are considered, which can cause long-lead times. The reactive method consists of not stocking spare parts and relying on the supply chain, whereas the three proactive methods consider heuristic quantity-based rules and linear optimization problems that account for spare parts costs and risk tolerance constraints. Sensitivity analyses are carried out around lead times and risk tolerance constraints.

For this case study, short lead times from days to weeks lead to a reactive method as the best choice, as suggested in literature. However, sensitivity analyses show that lost production can rapidly exceed risk tolerance thresholds even in scenarios with high-risk tolerances and no spare stock-up. Additionally, certain proactive methods can require high CAPEX for spare parts purchase. This leads to the conclusion that a one-spare stock-up policy with replenishment based on component-based risk review linking component failure risk to spare parts decisions, is a better approach, as it provides the greater transparency and CAPEX savings potential for a multidisciplinary group of stakeholders when deciding which components to stock.