Estimating the effect of conversion to a Group Technology layout on the cost of material handling

Group Technology (GT) is an approach to discrete part manufacturing that seeks to increase production effectiveness by grouping similar parts into families. The adoption of Group Technology concepts is an important decision since major organizational changes and substantial capital outlay may be involved. There is a need for a methodology to support the decision-making process. In this paper regression analysis is used to develop a mode that estimates the expected effect of conversion to a Group Technology layout on the cost of material handling.