This paper is concerned with machine-cell and part-family formation for the design of cellular manufacturing systems. The paper has two distinguished purposes. The first purpose of the paper is to introduce a modified p-median model, an integer linear programming formulation, for the machine-cell or part-family formation problem. Compared with the original p-median model, the modified model has additonal desirable features. The modified model allows the control of the size of machine cells or part families by introducing an upper bound on the maximal number of machines per cell or maximal number of parts per family. The modification also results in a substantial reduction of the number of constraints in the model formulation. The second purpose of this paper is to present various computational results in a comparative study for machine-cell and part-family formation based on the original and modified p-median models using three different definitions of similarity coefficients. Guidelines are given to choose design parameters, definition of similarity coefficients, and appropriate solution sequence of machine-cell and part-family formation.
