The measurement and use of operational flexibility in the loading of Flexible Manufacturing Systems

Flexibility has been recognized as a key aspect of a firm’s response to competitive markets. However, no accepted measures of flexibility exist that would allow firms to evaluate FMS planning policies. In this paper, three measures of operational flexibility are derived to represent the ability of an FMS to respond to external and internal disturbances given a production plan. These flexibility measures are then used to evaluate tool loading and part routing decisions. A minimum-cost tool loading and part routing policy is derived, modeled, and statistically tested against a maximum-production-rate policy. The minimum-cost policy resulted in inventory levels being lowered by as much as 43% while routing flexibility increases by as much as 11% without statistically affecting capacity flexibility or the planned makespan.