Forecasting Spare Parts Demand of Military Aircraft: Comparisons of Data Mining Techniques and Managerial Features from the Case of South Korea

Abstract

In a weapon system, the accurate forecasting of the spare parts demand can help avoid the excess inventory, leading to the efficient use of budget. It can also help develop the combat readiness of the weapon system by improving weapon system utilization. Moreover, as performance-based logistics (PBL) projects have recently emerged, the accurate demand forecasting of spare parts has become an important issue for the PBL contractors as well. However, for the demand forecasting of spare parts, the time series methods, typically used in the military sector, have low prediction accuracies and the PBL contractors are mostly based on the judgment of practitioners. Meanwhile, most of the previous studies in the military sector have not considered the managerial characteristics of spare parts (e.g., reparability and the irregularity of maintenance). No previous work has considered any such features, which can indicate the reliability of spare parts (e.g., mean time between failures (MTBF)), although they can affect the spare parts demand. Therefore, to develop a more accurate forecasting of the spare parts demand of military aircraft, we designed and examined a systematic approach that uses data mining techniques. To fill up the research gaps of related works, our approach also considered the managerial characteristics of spare parts and included the new features that represent the reliability of spare parts. Consequently, given the case of South Korea and the full feature set, we found random forest gave better results than the other data mining techniques and the conventional time series methods. Using the best technique Random Forest, we identified the contribution of each managerial feature set to improving the prediction accuracy, and we found the reliability and operation environment are valuable feature sets in a significant way, so they should be collected, managed more carefully, and included for better prediction of spare parts demand of military aircraft.