(IFIP — the International Federation for Information Processing) Asbjørn Rolstadås (Auth.), Norio Okino, Hiroyuki Tamura, Susumu Fujii (Eds.)-Advances in Production Management Systems_ Perspectives An

Advances in Production
Management Systems
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IFIP - The International Federation for Information Processing
IFIP was founded in 1960 under the auspices of UNESCO, following the First World
Computer Congress held in Paris the previous year. An umbrella organization for societies
working in information processing, IFIP's aim is two-fold: to support information processing
within its member countries and to encourage technology transfer to developing nations. As
its mission statement c1early states,
IFIP's mission is to be the leading, truly international, apolitical organization which

encourages and assists in the development, exploitation and application of information
technology for the benefit of all people.
IFIP is a non-profitmaking organization, run almost solely by 2500 volunteers. It operates

through a number of technical committees, which organize events and publications. IFIP's
events range from an international congress to local seminars, but the most important are:
• the IFIP World Computer Congress, held every second year;
• open conferences;
• working conferences.
The flagship event is the IFIP World Computer Congress, at which both invited and
contributed papers are presented. Contributed papers are rigorously refereed and the rejection
rate is high.
As with the Congress, participation in the open conferences is open to all and papers may
be invited or submitted. Again, submitted papers are stringently refereed.
The working conferences are structured differently. They are usually run by a working
group and attendance is small and by invitation only. Their purpose is to create an atmosphere
conducive to innovation and development. Refereeing is less rigorous and papers are
subjected to extensive group discussion.
Publications arising from IFIP events vary. The papers presented at the IFIP World
Computer Congress and at open conferences are published as conference proceedings, while
the results of the working conferences are often published as collections of selected and
edited papers.
Any national society whose primary activity is in information may apply to become a full
member of IFIP, although full membership is restricted to one society per country. Full
members are entitled to vote at the annual General Assembly, National societies preferring a
less committed involvement may apply for associate or corresponding membership. Associate
members enjoy the same benefits as full members, but without voting rights. Corresponding
members are not represented in IFIP bodies. Affiliated membership is open to non-national
societies, and individual and honorary membership schemes are also offered.
Advances in Production
Management Systems
Perspectives and futu re challenges
Selected, revised proceedings of the IFIP TC5/WG5.7
International Conference on Advances in Production
Management Systems (APMS '96),
4-6 November 1996, Kyoto, Japan
Edited by
Norio Okino
The University of Shiga Prefecture
Hikone, Shiga
Japan
Hiroyuki Tamura
Osaka University
Toyonaka, Osaka
Japan
and
Susumu Fujii
Kobe University
Kobe, Hyogo
Japan
IUI'I SPRINGER-SCIENCE+BUSINESS MEDIA, B.V.

First edition 1998
© 1998 Springer Science+Business Media Dordrecht

Originally published by Chapman & Hall in 1998
Softcover reprint of the hardcover 1st edition 1998
Thornson Science is a division of International Thornson Publishing I(DP'
ISBN 978-1-4757-4455-2 ISBN 978-0-387-35304-3 (eBook)

DOI 10.1007/978-0-387-35304-3
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The publisher makes no representation, express or implied, with regard to the accuracy of
the information contained in this book and cannot accept any legal responsibility or liability
for any errors or OInissions that may be made.
A catalogue record for this book is available frorn the British Library
8 Printed on permanent acid-free text paper, rnanufactured in accordance witb

ANSIINISO Z39.48-1992 (Perrnanence ofPaper).
CONTENTS
Preface ix
PART ONE Invited Articles

1 Productivity issues in the future enterprise: conclusions and recommendations
from the TOPP program
A. Rolstadas 3
2 Establishing an acadernic domain
H. Yoshikawa 13
3 Production management: which future?
G. Doumeingts and Y. Ducq 18
4 Recent trends of new product development and production management in
Japanese electronics industries
~~ ~
PART TWO Next Generation Manufacturing Systems and

Production Management 41
5 Next generation manufacturing systems (NGMS) in the IMS program
~ Okabe, P. Bunce and R. Limoges 43
6 Biological concept of self-organization for dynarnic shop-floor
configuration
J. Vaario and K. Ueda 55
7 A basic study on high volume flexible manufacturing system for
agile manufacturing
S. Fujii, H. Morita, Y. Tatsuta and Y. Takata 67
8 The collaborative engineering process within the framework of the
virtual enterprise
M. Williamson and R.L. Storch 79
9 Collaborative autonomous control
F. Biennier, J. Favrel and J.P. Denat 91
10 An agent based control system for a model factory
A.J.R. Zwegers, H.J. Pels, R.L.J. Schrijver and R.J. van den Berg 103
11 Future enterprise types and strategies for agile manufacture
I. Dean and A.S. Carrie 115
vi Contents
PART THREE Benchmarking 127

12 Performance analysis through benchmarking and recognition
ofpattems
H. Wildemann 129
13 Virtual benchmarking in logistics: a concept for the determination
of benchmarks
V. Hornung, H. Luczak and M. Oster 136
14 A benchmarking model for the customer order flow in
semi-processing industries
I.P. Tatsiopoulos, T. Katsikas and F. Clave 148
PART FOUR Integration in Manufaeturing and Deeentralized
Produetion Management 161
15 MRP-3 concurrent integration of planning and scheduling in OKP
(one of a kind production)
J.B. Elejabarrieta 163
16 Analysis and design of production and control structures
M.J. Verweij and A.J.R. Zwegers l7l
17 Designing organizational structures of production systems using a
process-oriented approach
G. Zülch and B. Brinkmeier 183
18 Object-oriented representation of manufacturing systems: state of the art
and perspectives
A. Bartolotta and M. Garetti 195
19 Autonomy and integration in decentralized production
E. Scherer 206
20 Centralized and decentralized control: finding the right combination
H. de Haas, J.O. Riis and H.-H. Hvolby 218
21 Implementing new production management modes: orchestration of
simultaneous improvement activities
J.O. Riis and J. Knopp 230
PART FIVE Strategie Aspects 241
22 Recent developments in the configuration of multiple-variant products:
application orientation and vagueness in customer requirements
S. Schwarze and P. Schönsieben 243
23 The ecology-driven service (r)evolution: the product 10ngevity approach
and its consequences for production and corporate management
H. Hübner 255
24 The impact of manufacturing strategy on the design of production
management systems: an exploratory study
J. Olhager and B. Cimander 267
Contents vii
25 Selection of assembly system configurations: adecision support system

A.K. Kochhar and Y.T. Abdul-Hamid 279
26 Production control challenges in the food and iron industry
H.-H. Hvolby and J. Trienekens 291
27 Expert system for new product strategy development
Marimin. L. Herlina. A. Aulia. M. Umano. I. Hatono and H. Tamura 303
28 Performance evaluation of a JIT production system
M. Kojima. K. Ohno and K. Nakashima 315
29 Games for organizationalleaming in production management
J.O. Riis. R. Smeds. J. Johansen and H. Mikkelsen 327
PART SIX Production Planning 339
30 Production planning system coping with changing customer requirements
M. Enomoto. H. Matoba. H. Morita and T. Segawa 341
31 Production planning and control on the basis of control theory
H.-P. Wiendahl and J.-w. Breithaupt 351
32 Integrated production management for production planning, loading
and scheduling
F. Oba. T. Murayama and D. Ma 363
33 Integrated planning and scheduling for multi-product job-shop assembly
based on genetic algorithms
M.F. Sebaaly and H. Fujimoto 375
34 Solution of the problem for a large scale integrated plan in the iron
and steel production control
M. Shiota and S. Manabe 387
PART SEVEN Production Scheduling 397
35 An autonomous jobshop scheduling system under dynamic production
environment considering machine breakdowns
H. Shin and M. Kuroda 399
36 A study on holonic manufacturing systems and its applications to real time
scheduling problems
N. Sugimura. T. Moriwaki and K. Hozumi 411
37 Performance evaluation of distributed real-time scheduling systems
using distributed production system simulator
I. Hatono. T. Nishiyama. M. Umano and H. Tamura 423
38 Genetic algorithm approach to multi-objective scheduling problem in
plastic forming plant
H. Tamaki. T. Mukai. K. Kawakami and M. Araki 435
39 A synthesized chart for scheduling of production systems with automated
guided vehicle
H. Hase and N. Okino 445
viii Contents
40 Scheduling for an automated three-machine flowshop manufacturing system

J. Cheng and H. Kise 455
41 DEJA VU: a reusable framework for the construction of intelligent
interactive schedulers
J. Dorn, M. Girsch and N. Vidakis 467
Index of contributors 479
Keyword index 481
Preface
This volume includes 41 revised papers selected from 125 papers presented at the
6th IFIP Technical Committee 5/Working Group 5.7 International Conference on
Advances in Production Management Systems - APMS'96 - held at Kyoto, Japan,
4-6 November 1996. The task of selecting papers was accomplished by the IPC
members voting. The selected papers were reviewed by IPC members who attended
the conference. Based on the comments of reviewers, each paper was revised and
rewritten in the format of this book. Therefore, the quality of each paper was raised
very much.
The papers selected in this volume were classified into invited articles and six
themes taking into account the perspectives and future challenges in production
management systems. Invited articles provide the overview of the present and
future trend in the manufacturing world. Six themes were Next Generation
Manufacturing Systems and Production Management, Benchmarking, Integration in
Manufacturing and Decentralized Production Management, Strategic Aspects,
Production Planning, and Production Scheduling. Each theme covers important
area of present and future production management reflecting the recent trend in
manufacturing toward globalization, agility in variety production, human centered
manufacturing, environment consciousness, and so on.
We hope that this volume will emerge a lot of new ideas to reach the goal of IFIP
WG5.7 "Computer Aided Production Management" and to bridge the gap between
research and industrial practice in production management systems.
We would like to express our sincere appreciation to the individual of the
international program committee of APMS'96 who joined the task of voting for
selecting high quality papers from all the papers presented at APMS'96, and to
those who reviewed the selected papers to raise the quality of the papers. We are
strongly indebted to Dr. Itsuo Hatono and Ms. Mie Kuronaga of Osaka University
for their great efforts in the preparation of this volume.
Norio Okino Hiroyuki Tamura Susumu Fujii

Conference Chairman IPC Chairman Executive Committee
APMS'96 APMS'96 Chairman
Professor Professor APMS'96
The University of Shiga Osaka University Professor
Prefecture Kobe University
Professor Emeritus
Kyoto University and
Hokkaido University
PARTONE
Invited Articles
1
Productivity issues in the future
enterprise - Conclusions and
recommendations from the TOPP
program
A. Rolstadäs
Department 0/ Production and Quality Engineering,
Norwegian University 0/ Science and Technology
N-7034 Trondheim, NORWAY
Tel: +47-73593785 Fax: +47-73597117
Arolst@protek.unit.no
Abstract
TOPP is a productivity research programme for the Norwegian manufacturing
industry which was completed in 1996. It studies productivity at two levels: self-
audit and external audit. Both use an enterprise model comprising functions,
system variables, cycles, and management philosophies. The external audit in
addition uses a model with indicators for economy, external relations, internal
relations, and ability to change.
TOPP has recognized the change from a prevailing productivity paradigm based
on efficiency in resource consumption to a new performance paradigm putting the
customer in focus and taking several other aspects than efficiency into account.
The future enterprises will be characterized by a focus on total quality,
globalisation, and a business process-oriented approach. The globalisation will
lead to the "virtual enterprise". The virtual enterprise can obtain a competitive
position by defining and re-engineering its business processes.
TOPP has made studies in 60 enterprises and has drawn its conclusions from
these and given 10 recommendations.
Keywords
Productivity, ModeIling, Manufacturing, Information technology, Production
management.
Advances in Production Management Systems N. Okino, H. Tamura & S. Fujii (Eds.)
© 1998lFlP. Published by Chapman & Hall
4 Part One Invited Artides
1 INTRODUCTION
TOPP is an industrially led researach program directed towards productivity

increase in the Norwegain manufacturing industry. It has been sponsored by the
Norwegian Resarch Council, and has been executed by the Norwegian University
of Science and Technology (NTNU), SINTEF, and the Federation of the
Norwegian Engineering Industry (TBL).
TOPP was initiated in 1991 and the program was concluded in March 1996.
More than 30 mHl. USO has been spent on the progject. About 35% of this is
governmental money.
The TOPP-programme consists of the following subprograms:
• Oeveloping company productivity and competitiveness study
• Implementing industrial improvement actions
• Oeveloping knowledge through research projects
• Long-term competence development
About 60 enterprises has participated in TOPP. 40 of these have done in-depth
productivyt studies and are referred to as TOPP enterprises.
TOPP has used the term productivity in a wide sense. Productivity has been
defined as ''the ability to satisfy the market' s need for goods and services with a
minimum of total resource consumption". This includes all value adding activities
in the enterprise and all factors the enterprise can influence to improve its
competitiveness.
The goals of TOPP has been (Andersen, et al., 1996):
• Oevelopment and adaption of knowledge about measures aimed at
increasing productivity
Competence development in the TOPP enterprises
Competence development at NTNU/SINTEF
• Motivation and information about activities aimed at increasing
productivity
• Implementation of measures aimed at increasing productivity in
Norwegian companies
At least 5 companies shall obtain results that set outstanding
examples for others.
At least half of the companies shall obtain specific results
within time and quality such that others can benefit from the
experience.
• Contribute to the implementation of education and continued education
programmes within productivity
Educate 10 Or.ing. (Ph.O.)
Establish a masters degree in technology management
Establish a continued education course on productivity
TOPP has put main focus on time and quality as competitive factors.
The significance of the TOPP results compared to previous work can be
summarized in the following key items:
Productivity issues in the future enterprise 5
• A new enterprise model has been developed which is better suited for
performance measures than previous models.
• A set of indicators has been derived based on both qualitative and
quantitative information.
• A self assessment tool based on business processes has been developed
and supplied to industry.
• Industrial awareness has been developed and general guidelines have
been supplied for improved industrial performance.
2 THE FUTURE PRODUCTIVITY PARADIGM
Productivity is a term usually associated with efficient resource utilisation, and

many still today measure productivity as the a ratio between output and resources
consumed. Typical members are output per employee or capital and number of
production hours per machine, etc. This type of thinking has led to suboptimization
and has failed to direct the management focus to the most productivity influencing
factors. This type of thinking can never satisfy the intentions laid down in the wide
definition of productivity given in the previous chapter.
Productivity in the classical sense is by no means a new issue. It is sufficient to
refer to early methods such as (Rolstadiis, 1995):
• Taylor' s Scientific Management
• Frank and Lillian Gilbreth's time and motion studies
• The Henry Ford assembly line
• The learning curve
• The Hawtorne studies
In the future enterprise process thinking is dominating and benchmarking is
frequently used to improve productivity (Andersen and Peterson, 1994).
The future enterprise is "lean" or "agile". The customer is in focus. All activities
in the company must add value for the customer. Otherwise they represent a waste
of resources. The customer worries about price, quality, service, and delivery.
Total quality management has become a new topic addressing all these problems.
Actually, it goes far beyond product quality. It looks at quality in every link and
every activity. The customer's expectations must be exceeded.
The future enterprise will compete in a changed market characterised by
(Rolstadiis, 1995):
• Declining demand
• Global competition
• Customer in focus
• Life cycle requirements
• Environment protection restrictions
This market is international. Each business process in the company must be
benchmarked against the very best world-wide (Rolstadäs, 1993). But only the
market is international. The same is true for the company. A successful
6 Part One Invited Articles
competitive company may place its development activities in region A and its
manufacturing in regions B and C. These activities may be moved at imy time to
the region offering the most favourable conditions. The company will focus on its
core business processes and may outsource the rest to more-competitive suppliers.
These suppliers may have long-term contracts including technological
development. The company will establish a strategic alliance with its suppliers.
This may even extend to the customers or vendors. This is what is meant by the
virtual company (Kimura, 1993; Rolstadäs, 1994). The virtual company consists of
a number of units geographically dispersed but managed as one total unit, although
the subunits may be under separate management.
Globalisation is a very important development trend in industry. Another
important aspect in industrial development in process oriented thinking
(Harrington, 1991). As competition becomes global, it also becomes more fierce.
To stay competitive is a continuous race. Industry must continuously improve
itself. There is not time to "lean back and take a break".
In the future enterprise the classical way of measuring productivity must be
released by a new and more holistic approach. The prevailing productivity
paradigm focusing on efficiency in the use of resources, must be replaced by a new
productivity paradigm focusing on performance. Performance regards efficiency as
one out of several factors that determine productivity (Rolstadäs, 1995). One of the
fIrst to define measures for performance were Sink and Tuttle (Sink, 1985; Tuttle,
1989). They regarded effectiveness, efficiency, quality, productivity, quality of
work life, innovation and profitabilitylbudgetability.
3 THE TOPP MODEL
TOPP has developed two sets of methodologies for measuring productivity in a

company (Moseng and Bredrup, 1993):
a. Self-audit based on a questionnaire answered by the
companies.
b. Extemal audit performed by experts analysing the companies.
There are some similarities between TOPP and the methodolgy used for awards
like Malcom Baldrige, Deming, and the European Quality Award. However, TOPP
focuses on more aspects concerning the competitiveness of the whole company,
while the awards mentioned have their main focus on quality.
Both methodologies require an enterprise model suitable for understanding and
measuring differences in performance between companies.
The TOPP model is based on a three-dimensional performance model as shown
in figure 1. Effectiveness indicates to which extent customer needs are satisfied,
efficiency indicates to which extent the total resources of the company are
efficiently utilized, and ability to change indicates to which extent the company is
prepared to adapt to a changed market.
EFFICIENCY
- - - - - - - ;"'1
- --.
ABILITY TO
- - - - - - - - -;
, ' CHANGE
EFFECTIVENESS
Figure 1 Performance measurement.
The self audit is performed by using a questionnaire which is answered by each

company. The questionnaire contains three parts (Roistadas, 1995):
• Part 1 - Facts about the company, products, cost, finance, manpower,
capacities, production, etc.
• Part 2 - Overall evaluation of different functions and system variables.
This part is answered confidentially by 20 individuals in the company.
• Part 3 - Detailed evaluation of primary and support functions and
system variables (products, facilities, personnel, etc.). This part is
answered by specialist groups in the company. Management is
represented in all groups.
The self audit is based on a model break down of the enterprise in four different
ways (Roistadas, 1995):
• Primary and support functions
• System variable
• Cyc1es
• Management philosophies
The external audit uses external experts. The company is analysed in two
different ways (Roistadäs, 1995):
• Company "split-up" using the same breakdown as for the self audit.
• Company as a whole using indicators focusing on the overall
performance of the whole enterprise (see figure 2).
8 Part One lnvited Articles
EXTERNAL
ECONOMY RELATIONS
I I
1. PROFITABllI1Y 1. MARKET
2. CASH FLOW 2. BOUNDRY
CONDITIONS
3. FINANCIAL
STABllI1Y 3. EXTERNAL
RESOURCES
INTERNAL ABllI1Y TO
RELATIONS CHANGE
I I
1. COST -EFFECTIVE 1. STRATEGIC
USE OF AWARENESS
RESOURCES
2. CONDITIONS
2. WORK FOR CHANGE
ENVIRONMENT
Figure 2 Company level-analysis areas.
The results of the external audit are presented in a profile chart for enterprise.
Figure 3 shows an example.
The TOPP methodology has been refined to provide a tool of enterprises to
assess their productivity development independent of any external help. The
method is called self assessment and includes six steps:
1. Identification of critical and important business processes in the
company.
2. Selection of areas to be analysed and appropriate indicators of
performance measure.
3. How to organise self assessment.
4. Data collection
5. Presentation of results
6. Actions based on evaluation of results
Productivity issues in thefuture enterprise 9
1234567
1 . t:'rocucts
System
variables
2. Fociclities --'
3.
4.
Equipmen t
Personnel '~
/~
5. Org ./mgt. systems
Functions 1. Marketing/soles
(primary) 2. Procurement
'\
3. Design
4. Technologica l plo nning
l>
.~
5. Prod. planning and control r--;:::.
6. Production/assembly
•
1. Strateg lc management
Functions 2. Qua lity managemen t - TOM "r-- r--'1
(support) 3. Finoncial management ~
4. Product development ,....~
5. Technalogy develapment
~
6.
7.
8.
Personnel management
Information techno logy
Ma intenance
·K lP
7 - Best proctice
4 - On the same level os most importe nt competitors
1 - Far behind
Figure 3 Example of profile chart from TOPP external audit.
4 TOPP CONCLUSION AND RECOMMENDATIONS
Based on the findings from TOPP productivity studies and associated research
project, a total of 13 conclusions have been drawn concerning external conditions,
internal conditions and internal processes.
These conclusions are (Andersen, et al., 1886):
External conditions
1. Stable and weIl developed business relations to other partlclpants in the
production chain is avital condition for effective value adding.
2. The best companies have developed a customer focus throughout the entire
organisation.
3. Most companies are insufficiently prepared for the challenge the development
towards virtual enterprise represents.
Internal conditions
4. The best companies have internationally competitive products.
5. The best companies apply considerable resources on continuous technology
development.
6. The best companies have develped simple and decentralised organisational and
decision-making structures and focus on business processes.
7. The majority of the companies base strategie as well as operational management

on incomplete or inaccurate measurement systems.
8. The majority of the companies need better concepts for production
management.
Internal processes
9. Many companies which have invested in modern production equipment are
unable to fully exploit the potential this represents.
10. Most companies give procurement low priority and have not taken sufficiently
advantage of the possibilities new types of supplier partnership represent.
11. The best companies emphasise overall co-ordination and integration of the
product development process and work closely with potential customers.
12.0nly a few companies have organised improvement processes which
systematically comprise all the company's activities.
13. The best companies focus on time and quality as competitive parameters.
In addition to these conclusions, 10 recommendations have been made for

industry, government, and universities. These are (Andersen, et al., 1996):
Recommendations for industry

1. Carry out systematic productivity measurement based on the organisational
structure and company culture.
2. Develop the virtual enterprise and rationalise the logistics chain.
3. Develop a customer focused organisation.
4. Implement new organisational structures based on employee participation.
5. Goal oriented competence development to support and further develop the
company' score competence.
Recommendations for government agencies and institutions

6. Prepare for development of industrial competitiveness.
7. Continuous focus on productivity and competitiveness.
8. Focus on productivity development in small and medium companies through
transfer of research results within productivity.
Recommendations for universities and research institutions

9. Establish a productivity centre in a network.
10. Develop an improved education and continuous education programme within
productivity related subjects.
TOPP has been a successful program and has achieved all its major goals. The
TOPP method has been applied in other international projects. In addition a sirnilar
program is set up within the European Union. The program is called ENAPS - The
European Network for Advanced Productivity Studies (Roistadas and Strandhagen,
1995).
5 REFERENCES
Andersen, B. & P.G. Pettersen (1994), The Basis of Benchmarking: What, how,
when, and why, in 'Proceedings for 1994 Pacific Conference on
Manufacturing', Djakarta, Indonesia.
Andersen, B., E. Printz Moe, B. Moseng & A. Roistadäs (1996), Produktivitet og
konkurranseevne i norske bedrifter, ad Notarn, Oslo (in Norwegian).
Harrington, J.1. (1991), Business Process lmprovement: The Breakthrough
Strategy for Total Quality, Productivity, and Competitiveness, McGraw-Hill,
New York, N.1.
Kimura, F. (1993), Virtual Manufacturing Environment, 'IMS Globemann 21
Meeting', Kyoto.
Moseng, B. & H. Bredrup (1993), 'A Methodology for industrial Studies of
Productivity Performance: Production Planning & Control' , 4 (3).
Roistadäs, A. (1993), Manufacturing Industry Benchmarking, in 'Proceedings for
APMS'93', Elsevier Science Publishers.
Roistadas, A. (1994), Beyond Year 2000 - Production Management in the virtual
Company in 'Proceedings for IFIP WG5.7 Conference on Evaluation of
Production Management Methods, Gramudo, Brazil, March' , Elsevier Science
Publishers.
Roistadas, A. (ed.) (1995), Performance Management - A Business Process
Benchmarking Approach, Chapman & Hall.
Roistadäs, A. (1995), TOPP - A Productivity lmprovement Programme for
Norwegian lndustry, Norwegian Institute ofTechnology.
Sink, D. Scott (1985), Productivity Management: Planning, Measurement, and
Evaluation, Control, and lmprovement, John Wiley & Sons, New York.
Sink, D. Scott & T.C. Tuttle (1989), Planning and Measurement in your
Organization of the Future, Industrial Engineering and Management Press,
Norcross.
Strandhagen, J.O.& A. Roistadas (1995), ENAPS - A European Network for
Andvanced Productivity Studies, SINTEF, Trondheim.
6 BIOGRAPHY
Asbj!llrn Roistadäs is professor of production and quality engineering at the Faculty of

Mechanical Engineering of The Norwegian University of Science and Technology.
His research covers topics like nurnerical control of machine tools, computeraided
manufacturing systems, productivity measurement and develoment, computeraided
production planning and control systems and project management methods and
systems. He is a member of The Royal Norwegian Society of Sciences, the
Norwegian Academy of Technical Sciences, the Royal Swedish Academy of
Engineering Sciences and APICS. He serves on the editorial board of the journal
Computers in Industry, and is the editor of the International Journal of Production
Planning and Control. He is past president of IFIP and past chairmen of IFIP TC5
and WG5.7. He is also past president of the Norwegian Computer Society and the
Nordic Data Processing Union.
2
Establishing an academic domain
Hiroyuki Yoshikawa
Professor Emeritus and Past President ofthe University ofTokyo
President of Science Council of Japan
President of Japan Society for the Promotion of Science
Science Advisor to the Minister
1-14-13-918 Tsukijima, Chuo-ku, Tokyo 104, JAPAN

Tel: +81-3-3532-5558 Fax: +81-3-3532-5558
Any sphere of scholarship is made in the following ways:
(1) Limitations are put on the subjects to be treated by that realm of scholarship.
Thus, the assemblage of subjects is fixed, and this is called collection.
(2) Simple, fundamental principles are brought out from the relationship among ele-
ments of the assemblage of selected subjects. These are called laws.
(3) A system concemed with phenomena that arise not in contradiction with the laws
is described. This is the theoretic system.
Probably such theoretic systems comprise the major part of many academic spheres.
They are normally arranged in a form convenient for learning, teaching, as weIl as
application.
Now since this alone is both too simple and yet difficult to comprehend, let us
consider the example of Newton's dynamies. As Newton in actuality presented the
world with the entirety of his theory of dynamies in his Principia-a Mathematical
Theory 0/Natural Philosophy, which is believed to have been published in 1687, this
means he was 45 years old at the time. In view of the fact that his interest in dynamics
sprouted during his student years, this caIculates to completion of the theory taking
more than twenty years.
Moreover, since Kepler's theory conceming the movements of celestial bodies
already existed at the time, and researchers of those days also continued to under-
take varlous studies, getting to the process behind the materialization of Newton's
dynamics is extremely complicated. Yet what we want to know here is not the his-
torical evidence conceming the materialization of his dynamies but the theoretical
structure lying in the background of that process.
The first topic is collection. Newton is known to have been interested in several
phenomena when he was a student. Issues like the real nature of matter, place, time,
movement, the order of the universe, energy, light, color, the sense of sight, sensation,
and so on cover the broad range of subjects of contemporary scholarship that also
treats physical laws, chemistry, organisms, human beings, etc.

© 1998 IFIP. Published by Chapman & Hall
From the standpoint of traditional natural philosophy, the disposition referred to

as overall explication is the value of the philosophical theory, so that all recognizable
subjects must be listed for the time being as the starting point. In other words, the
inclusion of all subjects can be said to be a requirement of collection.
This is strange when regarded from modem scholarship. Or else it can be called
reckless, because contemporary scholarship is divided into many realms. In addition,
the ambition to rnake thorough, coordinated explanations of all subjects is never
brought forth but, instead, gets ensconced in explications of intently and modestly
limited subjects.
While Newton started off by standing in a classical perspective and having inter-
est in all subjects, he nevertheless proceeded to limit his topics and eventually pared
them down just to moving bodies as dynamic actors. These moving bodies did not
consist solely of celestial ones but also included the apples on Earth. When con-
sidered now, that seems only natural, but it must have made for an extremely hOld
collection in Newton's days.
Newton successively put limitations on these sorts of subjects. He also attempted
to give an as coordinated explanation as possible of each one. Light and chemical
phenomena are included among them. Probably his plan was not to try to explain
all the subjects that interested hirn as a natural philosopher but rather to create a
collection by cutting off particular topics from all others through clear elucidation
of the perspective and to make an explanation peculiar to handling that alone. Then,
he stood in the position of reaching an understanding of all subjects by amassing a
comprehension of each collection, scattered though they were.
Here doubts arise as to why Newton made a collection that included both celestial
bodies and apples while he eliminated light from it. Expressed another way, this
means to ask on what basis did he fix his perspective and then build his collection.
An important characteristic of what we know as the modem academic system is its
division into several spheres. However, considering that the basis for and necessity of
those divisions can hardly be explained, the aforementioned doubts should be viewed
with grave importance in present times, too.
It is certain that Principia would not have seen completion if moving bodies and
light had been put into the same collection. Nevertheless, there are no grounds for
making the explanation that Newton fixed his viewpoint on moving bodies and lim-
ited the subjects in order to bring his dynamics to completion. That essentially does
not result in answering doubts, because the logical relationship is that only after there
are limited subjects does it become possible for systems of explanation to be brought
out. Besides, a system of explication could not possibly exist without limitations on
the subject.
The realms that characterize modem scholastic systems were essentially initi-
ated by Newton. The fact that the structure of the realm known as the dynamics
of moving objects became the true standard for scholarship thereafter attests to
Newton's boundless greatness. Since how he made that realm-in other words, that
collection-can not be explained, we can only say that it owes its materialization to
his greatness.
Establishing an academic domain 15
The next step in making scholarship is to bring out laws. When a collection is
given, various amounts related to it are observed, and the relationship among the
various amounts can then be obtained as a result of the observations. The collection
under Newton's dynamics is ofmoving objects; things like density, capacity, mass,
volume of movement, and strength are abstracted as amounts in relation to that.
Brought out next are the fundamental principles -in other words, laws necessary
and adequate for recognizing the feasibility of all movements that have actually been
observed, including those of celestial bodies and falling apples.
Laws in the case of Newton 's dynamics mean the following three concemed with
the uniform motion of bodies to which no strength has been added, the changes in
the amount of motion of bodies to which power has been added, and actionlreaction.
The framework of Newton's dynamics says that those three laws can be employed
to explain all movement observed, including both the movement of bodies for which
the inftuence of their viscosity on earth has been considered, too, and the movement
of celestial bodies.
There is extraordinary potency in asserting that every kind of movement can be
explained with just three items. Thereupon arises the question conceming how New-
ton discovered such powerfullaws. Yet it is also difficult to respond to that. There are
no such explanations in Principia, and it is said that perhaps Newton himself could
not explain it.
Nevertheless, the extraction of these laws is believed to have played a leading role
from modem times on at least in the progress of the natural sciences. A detailed
examination of that was conducted by Charles Sanders Peirce.
When Newton established his three laws, they perhaps ought to have been called
a hypothesis. This is because the laws can be deemed correct once all movements
inferred as lying within the realm of possibility according to these three completely
match all movements observed in reality. If things inferred as likely to occur do not
actually happen, or if movements observed in reality could not have been inferred
under the laws, then those laws should not be regarded as correct.
Consequently, since a law has not undergone sufficient investigation at the time of
its establishment, it should be considered a hypothesis at first. Therefore, the extrac-
tion of a law can be called the formation of a hypothesis. However, Peirce called this
inftuence abduction. The original meaning of that word usually refers to kidnaping,
and it would certainly not be wrong to say that the term gives off a sense of taking
something by force and without good reason.
I have emphasized that scholarship is also something thought of by human beings,
and in this case what is known as inference has played the leading part. If we divide
that very broadly and generally, we get deductive inference, inductive inference, and
formation of a hypothesis. If we think in terms of syllogism, inference in the rela-
tionship among rules, precedents, and results can be classified in the following ways:
Deductive inference: inferring the results from rules and precedents

Inductive inference: inferring rules from precedents and results
Formation of hypothesis: inferring precedents from rules and results.
This can be easily understood instinctively if we consider this in terms of the

following examples provided by Peirce:
Rule: All the beans in this bag are white;

Precedent: These beans were in this bag;
Result: These beans are white,
Here there is no worry about mistakes occurring with deduction.

Actually under Newton's theory rules are law; precedents are incIuded in the col-
lection of celestial bodies and apples, and resuIts in the assemblage of movements
that could possibly happen. If one precedent is selected, then a single movement cor-
responding to that will get designated. When possible, it is acceptable to put those
designations on a correspondence chart that incIudes everything; but in reality they
have come to be caIculated through mathematical solutions. The correspondence can
not be indicated on achart if it becomes infinite. Thus, this caIculation, which is far
more rational than the chart, will perform a valuable job.
In any case, we can understand that Newton's theoretic system of dynarnics is
deductive. If we take a look at Principia, the book that published his dynarnics, only
two pages are devoted to laws, while results for each precedent are indicated in the
several hundred pages remaining. The book consists almost entirely of deduction.
Weil, then how were the laws, which are most important in the materialization of
this great book, brought out? I earlier wrote that even Newton hirnself did not know,
but the materializing process took long years and must have been complicated. Yet
if we consider that as a question of inference, which have already been cIassified,
it will end up as inductioD. It is easy to infer after taking some beans out of a bag
and seeing they are all while that every bean in the bag is white. It is not something
a person spends grueling years pondering over. However, to make strict distinctions
between induction and the formation of hypothesis is not simple, and there are times
when we can not say that the extraction of laws is induction.
In reference to this, Peirce clearly related the difference between induction and
hypothesis-forming. He, thus, wrote an explanation to the effect that in contrast to
the essence of induction, which involves inferring a similar fact from another fact,
the formation of a hypothesis lies in inferring from a certain fact a different kind of
fact which is not directly observed.
Precedent is generally dispersed. Consequently, because there are many cases in
which inference for it is inference for a different type of fact, it is easy to explain
inference of a precedent as formation of a hypothesis. In the case of beans, the rule
is that all are white. Thus, the upshot is that when some red beans get mixed in, they
will be said to come from a different bag. Therefore, the need arises here to bring
in the new thinking known as a different bag. However, with induction, if some red
beans get mixed in with what are supposed to be all white, we only have to revise
the rule a little bit.
In the worId of scholarship, proposals for completely new laws-rather than slight
revisions in the laws- tend to be highly evaluated as new theories. While Peirce sug-
Establishing an academic domain 17
gested that various types of cases occur continuously in between slight revisions in
laws and new proposals, he regarded proposals for laws in a new theory as a supple-
mentary mixture of induction and formation of a hypothesis. He also claimed that
the formation of a hypothesis -that is to say, abduction- has played an important
role in the rapid progress of the scholarship known as new theories.
Peirce, furthermore, gave deep thought to abduction. However, in the end he was
unable to explain that action clearly and concluded that it is a strange human capac-
ity. Accordingly, his ideas conclude that Newton splendidly extracted forcefullaws
because he was great. Here, too, Newton's greatness comes through.
Now let us consider abduction a bit closer to ourselves. Speaking in terms of our
daily lives, it is conception; or in words popular nowadays, it is an act demanding
originality. I will next give some original examples.
As a rule, we can say that "human beings will die." Prom the precedent that
"Socrates is a human being," it can be inferred that "Socrates is likely to die." That
is deduction. In this style, under the rule "human beings will die," we are to have
witnessed something dying before our eyes. This is a result.
However, when we have no knowledge about the thing that died-in other words,
when we do not know what the precedent is-, we infer by developing a hypothesis.
To conclude that the object is a person because it died is a frank and perhaps original
inference. When it becomes clear in a later age that what died was reaIly a cockroach,
this will mean the absurd, nonsensical inference that "a cockroach is a human being"
was made at the time.
Nevertheless, the essence of abduction can be found here. Abduction increases
knowledge for people in the intrinsic sense, but the possibility of erring is present as
weIl. In contrast to deduction, where mistakes are not made, and induction, in which
it is possible to correct an error already made, when a slip occurs with abduction, the
next inference will begin aIl over from zero.
BIOGRAPHY
Hiroyuki Yoshikawa received Bachelor of Engineering and Doctor of Engineering

from the University ofTokyo in 1956 and 1963, respectively. He was a professor of
the University ofTokyo from 1966 to 1997 where he was the President from 1993 to
1997. He has been a Science Advisor to the Minister since April 1997, the President
of Science Council of Japan since July 1997, and the President of Japan Society for
the Promotion of Science since September 1997. His research area covers General
Design Theory, Intelligent CAD, Theory of Reliability and Maintenance, and Main-
tenance Robot. He is a member of IFIP WG5.7 and 5.2. He is the chairman of the
Committee of Intelligent Manufacturing Systems Promotion, Ministry of Interna-
tional Trade & Industry, the chairman of the Committee of Study, Japan Committee
of Industrial Performance, and the Deputy President of the Committee of Science &
Technology Policy (OECD). He is the past president of International Institution of
Production Engineering Research and Japan Society ofPrecision Engineering.
3
Production management: Which
future?
Doumeingts G. , Ducq Y.
LAPIGRAI - Universite Bordeaux I
351, Cours de la Liberation, 33405 Talence - FRANCE-
Tel: 33-(0)556-84-65-30
Fax: 33-(0)556-84-66-44 -
Email: doumeingts@grai.lap.u-bordeaux.fr
Abstract
This paper discusses about the evolution of the production management in the next
future. This evolution will concems the integration of production management (PM)
with the other functions inside and outside of the enterprise, the use of enterprise
modelling techniques to analyse, to design and to implement production management
systems with the choice of software packages. Then, we will focus on the evolution of
packages with the emergence of "Integrated softwares" and the role of "object
design".
Keywords
Production management, Software Packages, Integration, Enterprise modelling,
Object design, Extended Enterprise.
1. INTRODUCTION
Due to its technical, econornical social and human nature, the production management
has always presented a high complexity. This complexity is also due to its particular
position at the crossing of the administrative, financial, commercial, marketing, and
manufacturing functions.
Moreover, the dynamic running of the PMS and the interactivity between the human
organisation and the Information Technology (IT) processing make the problem
solving of the PM function as one of the most difficult among the functionalities of
the enterprise. This complexity increases also by the fact that there is a large variety
of techniques to produce from Make To Stock (MTS) to Engineer To Order (ETO)
and One of Kind Production (OKP). The obligation of cooperation between
enterprises in the line of Extended Enterprise increases also the complexity of
Production Management System.
Today, one very difficult task is to choose a weIl adapted software and to implement
Advances in Production Management Systems N. Okino. H. Tamura & S. Fujii (Eds.)
Production management: which future? 19
it in a short time.
Nevertheless, the evolution of the market and of the production techniques and
organisations implies an evolution of the concepts of production management.
After having defined the domain and· the main concepts of the production
management, this paper will draw the future trends of evolution focusing on
integration, use of Enterprise Modelling Techniques, and Packages Softwares.
2. THE DOMAIN OF THE PRODUCTION MANAGEMENT AND THE

SOFrWARESUPPORTS
After having described the various structures of Production Management, we will

analyse the Software Tools which support the Production Management in the
Enterprise.
2.1 The production management function in the enterprise.
The domain of the production management is very difficult to define. It exists a lot of
definitions and depending on the point of view (managers, structure of the enterprise,
type of manufacturing) the domain can change drastically.
First, we can use the traditional functions description : Planning, including Business
Planning, Master Scheduling, Capacity planning, Scheduling, and the links with
Material Requirement Planning, Purchasing, Procurement, and Resource
management. We will see later that this description is insufficient because the
dynamic behavior is not taken in account.
We can propose another point of view : a company can be decomposed in a set of
functionalities organised in a network. This network is presented fig 1 (we represent
only the links with production) :
In such an approach, the production management is considered as the interface

between the production and the other enterprise functions. The difficulty in such a
definition is that the relationships between the functions are conflicting. So, the
production management definition depends on the point of view taken in
consideration. This approach is difficult to implement due to the various models
which could be deduced.
r-----------~--~------------~
Enterprise
Figure 1 The various functions of the enterprise and their link with the production
function.
As an example of the description of the production system based on functions, there is

the architecture developed by IMPACS Project (Integrated Manufacturing Planning
And Control System) (figure 2).
Business Planning
Strategic
issues
Master Schedule development
and validation
Tactical
Requirement planning issues
Factory Coordination
Operationnal
issues
Figure 2 The CIMRU Architecture for Production Management System.
This architecture has two parts : the upper part which presents a classical
decomposition, a lower part which depends on the possibilities to decompose the
physical system (shopfloor) in ceHs (using for example Group Technology). Anyway,
the trends, today, is to decompose the workshop in ceHs (or sections) weH defined. In
such a way, we can apply the concepts of PAC (Production Activity Control).
At the business planning stage, emphasis is placed on planning in terms of aggregated
product families or modules. The master scheduling phase attempts to plan end level
items, frequently but not always, product which are shipped to the customer.
Requirements Planning is concemed with translating the master schedule items into
components requirements for short term planning and purchasing. Factory
coordination and Production Activity Control mainly deal with the short term
(manufacturing items and assembly products).
We can also use a third approach to define production management : the systemic
approach. In the systemic, three points of view are required to define a system : a
functional one, a structural one and a dynamic one.
For the functional point of view, we can use the previous description particularly the
IMPACS 's proposition.
For the structural view, we describe the components of the Production System
(products, machines, workstations, routes ... ).
For the dynamic view, we take in consideration the control ofthe Production System:
this control must aHow to reach the main objectives which deal with the optimisation
of the triplet : quality, cost and time.
In such way, the systemic approach proposes to decompose the System in two sub
systems: the controlled system that we will call the "Physical System" and the control
system which is in our point of view the "Production Management".
This control system will be decomposed again into two sub-systems: the decision and
the information.
The first one aims at elaborating the various decisions transmitted to the physical
system. The second one allows to transmit, to process and to record the required
information. It is the link between the physical and the decision sub-systems.
The decision and the information sub-systems are strong connected. So, a good
synchronisation between both contributes to a satisfying running of the production
management system.
in~:~~ ~--,.__~____~ DECISION

SUB·SYSTEM
Raw nwerial.
eo.,..,.,nenlS _ _-1n ---...;....~ FlniJbed
'......- _ ptOOuC!S
OBJECTIVES
OECISIONS • INFORMATION +
~ cnOlCE CruTERJA
CONSTRAINTS
OECISION VAJUABLES
Figure 3 The systemic approach of the production system
One of our conclusions is the lack of attention given by the specialists to the model of
production management. There is too much attention given to the functional view, but
it is not sufficient. It is necessary to be more precise and to not forget the systemic
approach including the Business Process approach.
2.2 Tbe software tools to support the production management.
Today, in a modern manufacturing system, the use of software tools is necessary. At

the beginning of the seventies, the important companies have developed their own
softwares. It was the case till the middle of the eighties. The situation is changing now
: the important firms buy software packages from the market as well as the SME's in
order to improve their competitiveness. The evolution of the software packages was
very slow till the end of the eighties. The structures of such softwares were quite
identical, and it was very difficult to adapt these packages to the various
characteristics of the manufacturing systems.
The most difficult in the acquisition phase of the software package is the choice. It
existed on the market an impressive list of packages but unfortunately, only perhaps
20 of them give satisfaction on operation al point of view.
The second problem to face, was the choice among the list of the most adapted
packages to the characteristics of the manufacturing system. We were always
surprised in the expression CAPM (Computer Aided Production Management) by the
interest on "Computer Aided" (analysis of the majority of existing packages by the
potential customers) and the poor interest on the "Production Management" model.
Often, the specifications were not elaborated seriously and the choice was more an
hazardous game than a serious evaluation of the candidate packages.
We must recognise also that in this recent past, the majority of Software Packages
were MRP 11 type. Few Packages were developed for the other types of
manufacturing : process, one-of-a-kind ... These were more "horne made softwares".
But now, the situation is changing.
3. EVOLUTION OF THE FUNCTIONS
The search of a multi-criteria performance for the production system requires for the
company to be customer oriented, to anticipate the customer needs and to adapt its
structure to the market changes.
The integration of the various functions of the production management system allows
to answer to this situation with ensuring not only the convergence of the objectives of
the functions but also the convergences of the actions. This integration is based on the
capacity of cooperation inside the organisation. The various tasks are not decomposed
and the functions are not compartmentalised any more. The only optimum is the one
of the enterprise rather that the one of each function. To be efficient, the integration
requires an organisation which defines the objectives, organises the cooperations,
circulates information, dispatches and coordinates responsibilities.
Moreover, due to the rapid changes of the market, the enterprise must be reactive.
This reactivity to the changes must involve the totality of the production functions.
So, this reactivity is increased if these functions are running together in the same time
toward the same goal, it means are coordinated. This is allowed also by tbe
integration of the functions.
However, this integration does not imply the centralisation of the decisions and of the
responsibilities but on the contrary the decentralisation of these decisions by the
decentralisation of the responsibilities, allowing to react as early as possible and to
increase the people motivation.
This motivation and this integration are finally also required to facilitate the evolution
of the production management.
Indeed, the integration allows to manage coherently several parallel projects which
aim at changing progressively the structure of the production system with the
minimum of disturbances. Moreover, the motivation of employees due to the
decentralisation is essential in the evolution process because it ensure the
appropriation of the new system by its main actors. It also avoids to build a system
too far from the expectations of the employees.
In the production system, this integration is present at several levels. First, this
integration must be effective between the production function and the other enterprise
functions : R&D, Accounting, Marketing, .... In a second time, the various production
functions must be integrated : design, engineering, manufacturing, delivery, and even
recycling.
In the production management domain, this integration become also stronger and
stronger between the various PM functions : to manage product, to manage resources,
to plan, To control quality, To manage maintenance...
The definition of the quality control is to ensure that the product meets the customer
requirements.
In the same time, the maintenance function contributes to the decreasing of the
disturbances.
We must mention the distribution of products (with all the logistic problems) and the
relations with the suppliers (Supply Chain). This new situation increases the
complexity of the planning system which is no more an internal function but must be
also combined with the planning of the partners in a distributed way.
The emergence of the Extended Enterprise and the Virtual Enterprise, where separate
companies agree to work together across the value chain to meet particular markets
needs, will only strengthen the trend towards integrated logistic systems.
A further complication is the increasing on environmentally benign production and
the emerging interest in products take back and recovery at the end of life cycle. This
requires the development of information systems and bills of material to support
product disassembly, module and components recovery for reuse and ultimately
material recycling.
In such adescription, we must mention the use of Business Process modelling
techniques : The Business Process describe a chain of interrelated activities which
normally must be connected with the customer requirements. In such adescription,
the Porter Value Chain help the company to define the most interesting activities for
the company (an economic but also technical and organisational point of view). This
analysis will allow in particular to determine the configuration of the Supply Chain.
4. THE ROLE OF ENTERPRISE MODELLING TECHNIQUES IN

PRODUCTION MANAGEMENT
The Enterprise Modelling Techniques (EMT) allows the representation of the

manufacturing system thanks to :
- a conceptual model defining the various concepts, the functionalities, the structures
and the dynamic behaviuor (see 2.2),
- formalisms allowing to describe and to represent this conceptual model,
- a structured approach guiding the use of the method in order to elaborate the PM
model.
Indeed, the complexity of the current production management systems leads, today, to
use such techniques to understand, to analyse, to design and then to improve the
system.
In order to perform the modelling, a huge amount of information must be gathered
and structured. These information come from many disciplines and are disseminated
among various users. Moreover, there is a need to integrate economic, human and
technical aspects.
It is obvious that to overcome these difficulties, an EMT is required. Moreover, the
efficiency of the production management system is required both in terms of cost and
time. So, its benefits can be expressed not only on the technical point of view in
facilitating the achievement of relevant solutions but also on the financial point of
view with decreasing the overcost due to the design mistakes.
The clear and precise representation of the system with the EMT allows to facilitate
the understanding of the system running by the users, and then to ensure continuously
their involvement in the change processes.
The specifications of the future system would be used not only for the design but also
for the choice of a CAPM system, the definition of its parameters, and for its
implementation : wrong specifications could lead to a dis aster which would be
discovered during the running. So, thanks to the EMT, the production system is
improved before its computerisation.

The modelling of Production System by EMT could facilitate the implementation of
the chosen Package, allowing a step by step implementation. With EMT, it is also
possible to elaborate the IT Model of the PM Package, to compare with the complete
model of the dedicated PM and to determine the adjustments on the both sides.
We think it is very important to be able to determine the rlifference between the both
structure (PM and Package) before to start the implementation.
The EMT improve the running with supplying documentation.
Finally an EMT can allow to design and to implement a Performance Indicator
System (it is the case of OlM [Grai Integrated Methodology] with ECOGRAI
method) which aims at measuring the performance of the new system according to its
objectives.
To iIIustrate this paragraph, one can cite the three EMT accepted by the Task Force
IFACIIFIP: PERA, CIM-OSA and OlM .
• PERA was developed at the Purdue Laboratory for Applied Industrial Control of
the PURDUE University. PERA is aiming at describing the life cyc1e of a CIM
project from the initial concepts through a functional analysis, a functional design (or
specifications), a detailed design, its development and its implementation until its
recycling.
PERA highlights the need to consider the human role in a CIM project. In the other
side, it does not use modelling formalisms but justifies the need for a structured
approach .
• The Open System Architecture for Computer Integrated Manufacturing was
developed by the European CIM Architecture (AMICE) consortium under ESPRIT
projects 688, 2422 and 5288 of the European Community. The objectives of CIM-
OSA is to develop a CIM reference architecture. The two main results of the CIM-
OSA project are a modelling framework for CIM and an integrated infrastructure. The
modelling framework for CIM supports all phases of a CIM system life cyc1e from
requirements definition, through design specification, implementation description and
execution of the daily enterprise operation. The CIM-OSA integrating infrastructure
provides specific information technology services for the execution of the particular
implementation model, but, more important for vendors, it provides independence and
portability.
• OlM was developed at the GRAl Laboratory and particularly through the ESPRIT
projects 418 OCS, IMPACS (Integrated Manufacturing Planning And Control
System) and FLEXQUAR 6408 . OlM is based on the GRAl model.
The GRAl model proposes a hierarchical and decentralised decomposition of the
production system. At the physicallevel, the system is decomposed in shops and then
in celIs, according to criteria which can be technical, organisational, or social. At the
decisional level, the decomposition criteria allow to determine the decision making
levels and, at each level, the various decision centres (figure 4).
To describe this model, OlM uses three types of formalisms. IDEFO modelling
technique plus other techniques inc1uding the simulation for the physical system
modelling, entity-relationships formalisms for the informational system and GRAl
grid and GRAl nets for the decisional system. The GRAl model allows to take into
account the integration features. To build the various models, OlM uses a structured
approach.
One of the particularities of OlM is to consider two design domains (to build the new
Production management: which future ? 25
manufacturing system):
- the user oriented domain which defines the user oriented specifications through
four models (functional, decisional, informational, physical),
- the technical oriented domain which defines the technical specifications divided in
three parts (organisation, information technology, manufacturing technology).
Figure 4 The GRAl model

It exists also other methodology which facilitate the implementation of Production
Management Packages as ARIS developed by Prof. SCHEER (university of
Saarbrucken), Procedure Analysis and Design (Mega International), METIS (NCR,
Norvege)
In conclusion, it become obvious that the EMT will take a preponderant part in the
Production Management with supporting BPR activities and facilitating the
implementation of PM Packages.
The Modelling of PMS by EMT can allow to use the simulation techniques in order to
anticipate on the evolution of Production System. More and more, in order to be
reactive, it could be important to simulate the evolution according to various
hypothesis.
5. EVOLUTION OF THE PACKAGES FOR PRODUCTION

MANAGEMENT
The increasing of complexity of production management and the current progresses

of softwares and hardwares led to a necessary improvement of the packages for
production management. The main recent improvements are the following.
5.1 The development of dient/server systems and the integration.
At the end of the eighties, enterprises reaIlsed the necessity of independence with
regard to the hardware and software solutions. So, there is an emergence of the
concept of "Open Architectures and Systems", these systems requiring
communication links.
Moreover, the delocalisation of decision centres due to the integration of the
functions, as mention above, implies at the beginning of the nineties, the appearance
of the distributed data processing environment and of the c1ient/server architecture.
Whereas the previous systems were "owner systems", the developments of
c1ient/server systems on UNIX allowed to decentralise the processing with a
centralised data base and with a relevant level of aggregation of these data.
For instance, in one Industrial project, we have developed a client/server architecture
with a Master Production Schedule managed by a micro-computer strong linked with
the industrial strategy, with a module of MRP and Purchasing at the middle term level
managed by adepartmental computer (medium size) (core of the architecture) and
finally, with several short term modules at the shop or celllevel managing the real
time scheduling, as shown below :
. ",-----' .. , .
~
~ ,
,'4/'-- --- ""',
.
Figure 5 An example of c1ient/server architecture
The main advantage of this system is the modularity. This modularity allows to assure
the evolution of the system. This evolution is required to support the flexibility of the
production systems, its various changes during the continuous evolution of the
production system and then to have the most appropriate production management to
answer to the customer requirements and to the market evolutions.
The second kind of packages are the Integrated Packages. Today, a new generation of
packages are proposed by the main software editors : these are pa.ckages which
integrate the various functions of the enterprise with the production function. The
disadvantage of these packages are the complexity and the difficulties to adapt them
to the specificity of each enterprise. Moreover, in this kind of packages, the
production management is missed in comparison with other functions as accounting
or sales. SAP, BAAN are certainly the most representative ofthis kind ofPackages.
5.2 Towards the Customisation of Production Management System.
We have seen the difficulties to choose a PM Package and sometime to implement it.
There is today an important debate between two points of view :
- first, some specialists recommend to choose any recognised PM Package (PMP), to
implement with a minimum of preparation and then, the PMP will structure the
organisation. This point of view is more alT specialists point of view.
- at the other extremity of this point of view, some specialists (often coming from
manufacturing side) recommend to choose carefully the PMP based on an elaborated
specifications book. They recommend, then, to adapt both : the organisation and the
PMP.
Where is the truth ? As usual between the both points of view. We don't believe it is
possible to adapt "drastically" the organisation, but we know also that the PMP
adaptation is limited. Anyway, we have to mention the possibility for adaptation of
the PMP to use with the Client/Server technology, the potentiality of high level
software development tools such as ACCESS or FOXPRO.
In this way, it is possible to create customised applications without incurring the high
cost of a long software development.
5.3 The use of object oriented approach.
The advantages are as important for the programmer as for the users. In one hand, for
the programmer, this approach allows to facilitate the development, to increase the
modularity of the package, to facilitate the definition of parameters and then the
implementation.
On another hand, for the user, this approach increases the user-friendliness, the
adaptability of the production system changes. Indeed, one or several modules can be
developed for a same function according to the requirements. It allows to have the
most appropriate package for the system. We can see today available software as
PROTEAN (MARCAM) for process industry.
6. CONCLUSION
Despite the recent evolutions of production management, a lot of work must be still
perform, in particular to integrate human and social aspects.
The danger with integrated packages is the lost of flexibility, of understanding, the
increasing of complexity and of the difficulties during the implementation due to the
long time of implementation.

However, the EnterpriseModelling Techniques can improve the situation, by
facilitating the implementation of PMP by ,on one side, adapting the organisation and
on the other side helping to describe and to understand the PMP.
The development of packages more open, more modular, in particular with the use of
object design, will facilitate the implementation.
Acknowledgement :
The authors want to acknowledge Professor Jim Browne, Professor Eero Eloranta and
Professor Asbjorn Roistadas which have given a strong contribution to the realisation
of this paper.
7.REFERENCES
Scheer A.W. (1994) "Business Process Engineering: Reference models for industrial
enterprises " Springer-Verlag -
Browne J., Harhen J., Shivnan J. (1988) - "Production management systems" -
Addison Wesley edition - 284p
Doumeingts G., Vallespir B. (1992) - "La gestion de production" - Techniques de
l'ingenieur - A 8 265 - 24 pages.
Doumeingts G., Breuil D., Pun L. (1983) "La gestion de production assistee par
ordinateur" - HERMES.
Doumeingts G., Ducq Y., Clave F, Malhene N. (1995) "From CIM to Global
Manufacturing" - CAPE 95 - Beijing - China -
Doumeingts G., Ducq Y., Kleinhans S., Clave F. (1996) "The GRAl Approach to
improve the competitiveness of industrial enterprises" - Mannheimer
Unternehmerforum - June 27-28th 1996 - Mannheim -
Higgins P., Le Roy P. , Tierney L. (1996) "Manufacturing Planning and Control :
Beyond MRP I1" - Chapman & Hall - 1996 - 235p -
Vollmann T.E., Berry W.L., Clay Whybark D. (1988) "Manufacturing planning and
control systems" - IRWIN -
Williams and all (1994) "Architectures for integrating manufacturing activities and
enterprises" - Computer in industry "Special CIM Architectures"- volume 24 -
number 2-3 - Septembre 1994 - ELSEVIER -
8. BIOGRAPHY
Guy Doumeingts is presently Professor at the University ofBordeaux 1, Director of

the LAP (Laboratoire d'Automatique et de Productique) and Head of GRAl (Groupe
de Recherchen en Automatisation Integree). He graduated from the University of
Bordeaux 1 and received his Ph.D. degree from the same University. He is one ofthe
founder of the GRAl Group which is a pioneer in the field of Enterprise Modelling.
He has published over 150 articles and three books. He is the Chainnan of the
Technical Committee NO.5 "Computer Application in Technology", of IFIP
(International Federation for Information Processing), a Member of SME, AFCET,
AFGL He is a member ofthe Editorial Board offour International Journals.
4
Recent trends of new product
development and production
management in Japanese electronics
industries
Toshio [toh
Mitsubishi Electric Corp.
Akasaka Minatoku, Tokyo, Japan
Phone 03-5573-4635
Abstract
This paper describes a new technology for market-driven and rapid development
which is carried out by making full use of advanced information technologies such
as intranets.
Keywords
Abduction, service-oriented technology, concept engineering, concurrent engi-
neering, collective genius, intranet
1 INTRODUCTION
Today's rapidly changing markets and technologies require rapid and market-driven
development of new products. This paper suggests a new technology addressing this
need. In this technology, development is carried out by a collective genius linked
over long distances across organizational boundaries with new information tech-
nologies. Specialists within the collective genius devise creative ideas by abduction
and carry out developments of new products integrating these ideas by service-
oriented technology, concept engineering, and concurrent engineering.
Needless to say, the effective utilization of information technologies is indis-
pensable for today's product development and production management. It is the
author's opinion that, among these technologies, those of intranets are most impor-
tant by the following reasons:
• They cause a paradigm shift in the distribution of knowledge in an enterprise.
• They change the development process of new products and the ways of pro-
duction management.

2 ABDUCTION
2.1 What is abduction ?
Abduction is a way of thinking. The concept of abduction was introduced by C. S.

Peirce (1839-1914), the founder of American pragmatism. It differs fundamentally
from the conventional approaches which are carried out by using mainly deduction
and induction. Different from conventional approaches that depend mainly on new
combinations of existing knowledge, it consists of establishing original objectives,
devising several hypothetical methods of the form "X leads to Y" to attain these
objectives, and verifying or disproving these hypotheses.
Since induction and deduction depend mainly on new combinations of existing
knowledge, they are suited to dealing with known facts and are largely independent
of personal experience. On the other hands, abduction is suited to dealing with
unknown problems, being largely based on personal experience and setting many
transcendental hypotheses, as explained in the following section.
2.2 Transcendental hypotheses which are core of abduction
Contrary to the conventional approaches which uses validated hypotheses, abduc-

tion frequently uses transcendental hypotheses. There are three types of transcen-
dental hypothesis:
(1) Hypotheses that have not yet been validated, but for which a process of vali-
dation can be devised.
(2) Hypotheses that are not susceptible to direct observation even in theory.
(3) Hypotheses that assurne the existence of things that have not yet been devel-
oped although they may be in the future.
Note: Types (1) and (3) are used in new-product development.
2.3 Abduction for product development
In applying abduction for product development, it is important to execute the fol-

lowing:
• to identify the functions desirable in the new product from the standpoint of
marketing.
• to adopt transcendental hypotheses even if their prior non-existence has been
demonstrated.
• to verify the feasibility of the transcendental hypotheses theoretically and
experimentally through the development process.
2.4 Salient features of abduction
(1) Abduction is unique among thought processes in that it supports creative

exploration of the unknown. Neither deduction, with its strict logical pro-
Recent trends in Japanese electronics industries 31
gression , nor induction, with its requirement for a large body of evidence to
support a hypothesis, allow a thinker to freely explore the unknown.
(2) Abduction starts with easily available reference materials without waiting for
a thorough elucidation of unknown factors or even for all the relevant facts to
come in. Naturally, the larger the pool of available knowledge, the better this
process will operate. Information technology support abduction because it
greatly facilitates the use of available information resources.
(3) Abduction can proceed earlier and faster than induction because it does not
require a large body of verified facts. Please note that this makes it an ideally
suited to today's fast-changing Internet/intranet environment.
(4) The disadvantage of abduction is its vulnerability to error compared with
other approaches where facts are painstakingly assembled beforehand. How-
ever, the disadvantage of time loss by the other approaches is greater than the
vulnerability of abduction.
(5) Abduction constitutes a progressive, open-ended process giving the thinker
latitude to incorporate numerous different points of view.
(6) Abduction can lead to more useful hypotheses if we try to find them in other
fields of acadernic and industrial importance. Please note that by using intra-
nets, multiple individual specialists engaging in abduction can be linked ac-
ross divisions of organization, discipline and culture, creating aspace for the
phenomenon of collective genius to emerge.
3 SERVICE-ORIENTED TECHNOLOGY ?
3.1 What is a service-set?
To promote the market-driven approach, development of a product should be ori-

ented to the preferences of the individual consumer. For ease of this development,
we are introducing a new technology called "service-oriented technology" which
satisfies the following conditions:
(1) To be suitable to design new products which include many semiconductors.
(2) To be suitable for both hardware and software development.
(3) To be comprehensible to all those involved, from top management to the indi-
vidual researcher.
Service-oriented technology regards any activities like the above in terms of three
vital elements: an object which performs a requested service, the request (order or
direction) I events which invoke the service, and the contents ofthe service. We call
these "object," "message" and "service," and the set of {receiver, message, service}
a "service-set." Please note that the object in the service-set has the same concept
as the object in object-oriented technology and is subject to many notions related to
the object in the technology such as class, inheritance, polymorphism, framework,
and so on for the reuse of existing service-sets/objects.
In service-oriented technology, we start to design a new product by describing
the service-sets of the product which are visible to its users. We call these service-
sets " visible service-sets" because users should understand them when they use the
producL
In the development of a compact disk player, for example, we start to design a
CD player by its visible service-sets as folIows:
The service-sets of a CD player
CD {CDPlayer PowerOn APower turns on}
® {CDPlayer MotorOn ADisk rotates without sensible wow}
® {CDPlayer SelectTrackNumber ASelects track only by key selection}
@ {CDPlayer Play APlay without scratch noise in dynamic range of95dB}
® {CDPlayer VolumeUp AAmplify sound signals to the specified level
without sensible distortions of phase and amplitude}
® {CDPlayer Stop AStop disk rotation automatically}
(j) {CDPlayer PowerOff ATurn off power supply}
In the service-set of {CDPlayer PowerOn ATurns on power supply}, for
example,
• 'CDPlayer' is an object
• 'PowerOn' described by bold Italic letters is a message
• 'ATurn on power supply' following the caret mark describes in verb-
object combination the service that the object executes.
3.2 Hierarchical structure of service-sets
While the service-sets from CD to Cf) are all visible to users, they are also imple-
mented by a number of other service-sets not shown which are invisible to users.
We call these service-sets "invisible service-sets."
Now, the visible service-sets of the CD player are performed through the coor-
dinated activity of its parts/sub-systems such as a remote control unit, microproces-
sor, power supply, disk, pickup, and audio system. For example, the service-set ®
is realized by the coordination of the service-sets of the many parts such as the
remote control unit, the micro-processor, the pickup, the disk and the power supply.
Therefore it is described hierarchically as follows:
® -, {CDPlayer Stop AStop disk rotation}
o {Remote Stop ASend infrared signal to stop play}
o {MicroProcessor Stop ASend signal to move pickup to track O}
o {Pickup MoveToTrackO ASeek and move to track O}
o {DiskRotationStop&lnjormPowerSupply AStop disk rotation}
o {PowerSupply RotationStop ATell PowerSupply disk rotation stop}
Note that while the object of visible service-sets is the product itself, those of in-
visible service-sets are its parts I sub-systems.
Generally, the invisible service-sets themselves are performed through the
coordinated activity of their parts/sub-systems too. This means that service-sets
comprise a hierarchical structure with visible service-sets at the top. We refer to

this as the service-set hierarchy; a single service-set made up of multiple service-
sets is called a superset, and the sets that together comprise a superset are called
subsets.
4 CONCEPT ENGINEERING
4.1 External functions of a product
Determining the services of visible service-sets of a product is the most important

part of concept engineering, because users do not buy a product for its hardware or
software but for the service it returns in response to the request (message) of the
user. Note that it is not the particular hardware or software but the service that they
need. They buy a telephone because it returns the service of enabling conversations
with those geographically remote, a washing machine because it returns the service
of cleaned clothes, etc. In the case of a product, its services take the form of the
functions it provides to the user and we call these "external functions."
4.2 Discontent analysis
The most effective method for analyzing the external functions is discontent analy-
sis. Every existing product has external functions with which its users are discon-
tented. For example, I could list my feelings about the past LP audio system.
Stylus replacement is troublesome.
Record surface noise is too high.
Unacceptable distortion occurs in the amplification process.
Stereo channel separation is poor.
Selection of individual musical items on a disk is difficult.
The dynamic range is too restricted.
In the analysis, the analysts determine discontent with existing products that are
similar to the intended product using one or more of the following methods:
• They may engage in direct dialogue with customers.
• They may try to derive the users' discontent by becoming virtual users them-
selves. (Consumer goods such as horne appliances and personal computers are
often used by the analyst in person. This can be effective provided the analyst
successfully emulates a true user, ignorant of the product's technological as-
pects.)
• Questionnaires surveying customers and dealers can also reveal discontent
with existing products. And finally, traveling the sales routes can reveal dis-
content from conversations between the analyst, dealers and salespersons.
4.3 Design of externat functions
Generally, discontents cannot be derived systematically. This makes it necessary to

arrange them systematically be fore we can use them in the design of visible service-
sets with external functions without the discontents. I would like to suggest how
external functions can be arranged systematically from the discontents.
Before attempting a systematic arrangement, all discontents should be restated
as the converse ideal functions. Then, analysts can collaborate with design engi-
neers to describe the external functions thus derived in a systematic way. It is re-
commended to express functions in a verb-object combination, occasionally modi-
fied by phrases that specify the function more precisely. Analysts must incorporate
their own ideals for the functions of the intended product, or the subsequent phase
of designing functions will amount to no more than an improvement to an existing
product. Some examples follow of such descriptions of external functions.
A Classified Description of the External Functions of a Compact Disk
CD-, Recorded Sound
o Record signals in dynamic range higher than 95dB +- Dynamic range is
too restricted.
®-, Music Selection
o Select pressing a button +- Selection of music items on a disk is difficult.
®i Sound Reproduction
o Detect signals without physical contact +- Surface noise is too high.
o Amplify signals without phase distortion +- Channel separation is poor.
o Amplify signals linearly +- Distortion occurs in reproduction.
In the above table, the discontents are given to the right of the arrows +-, and the
ideal functions derived by restating them are described on the left.
Once we arrange functions of a CD player systematically as above, it is easy to
design its service-sets as shown in section 3.1.
4.4 Architecture design
In the next stage, design engineers strive to devise the invisible service-sets whose
objects are various parts/sub-systems which realize the external functions by im-
plementing their services/functions collaboratively. These invisible service-sets, too,
are collaborative combinations of activities of their sub-sets and themselves. In
doing this, we should strive to reuse the service-sets of existing parts. It is important
to be persuaded of the effectiveness of the reuse of existing parts. If we could not
find reusable service-sets, we should use abduction to create a new service-set set-
ting the realization of the function of its superset as its objective and devising tran-
scendental hypotheses. We call this activity "architecture design" of a product.
Thus, in the architecture design, the visible service-sets are expanded hierarchi-
cally down to either the existing service-sets or the new service-sets which will be
developed by the concept engineering explained in the following sec ti on.

Through the above processes, the concept of a new product is visualized.
4.5 Value analysis of product concepts
To evaluate the value of product concepts developed in these ways, follow the steps
given in the following, then re-examine the architecture design in the light of your
findings. This process should be iterated until a concIusion can be reached.
(1) First, suggest a sales strategy and estimate total system costs. This process is
broken down into the following steps:
• Cite examples of similar products.
• Perform market segmentation for these products.
• Identify the market segment of the intended product.
• Determine the sales promotion appropriate for this segment.
• Estimate market share in this segment and forecast the sales amount.
The estimates of sales amount are particularly important for electronic products
with custom-made ASICs, because the cost of the ASICs decreases in direct
proportion to the number of items produced.
(2) Next we should estimate a viable sales price. This process breaks down into
the following steps:
• Investigate the prices of existing products with external functions similar to
those of the intended product.
• Estimate a viable price from the prices surveyed, taking into account the
fact that the viability of a price is not affected by internal functions hidden
from users nor by external functions in which users have no interest.
(3) To estimate the function cost is important as the third step. The function cost
is the lowest cost for which a product with given external functions (visible
service-sets) can be produced and sold. Needless to say, given the functions,
we will go for the lowest cost, and it is the function cost that determine the
lowest possible price at which we can seIl.
To get the function cost of a new product, iterate the following process against
the architecture designs to obtain the function cost until the function cost is
lower than the viable sales price (minus target profit and the cost of sales).
Estimate the cost of reusable objects first. Then estimate the cost of new ob-
jects to be developed. As they may incIude transcendental hypotheses, estima-
tion is difficult. However, rough estimates may be made using the following
method.
For hardware, use conventional value analysis (VA) methods to conceive a
production method and determine the relationship between the number of items
produced and the production cost, particularly in the case of mass-produced
products.
• Estimate the cost of materials and purchases.
• Estimate development cost and divide by the number of items to be sold.
For software, estimate development costs and divide by the number of units
to be sold.
5 CONCURRENT ENGINEERING
In the next step, we should carry out the following activities:

• To design the method of the service in the service-set of a product whose
service and messages have been designed in the concept engineering.
• To develop parts andlor subsystems for the hardware and programming for the
software.
• To assess the validity of the many transcendental hypotheses conceived during
concept engineering, often giving rise to further new hypotheses.
To complete these activities as speedily as possible, we are promoting concurrent
engineering. Concurrent engineering is a technology for rapid development in
which we divide a development project into a number of sub-tasks and perform
them simultaneously to the maximum extent permiued by available resources.
Please note here that it is vital to select the more important themes from among
many proposed before implementing concurrent engineering so that as many people
as possible may co-operate in their development. Without allocating finite human
resources on the basis of careful selection, the effectiveness of concurrent engi-
neering is seriously impaired.
5.1 Partitioning the product to identify sub-tasks
After the selection, you should begin to make scheduling of development and allo-
cate necessary resources. This involves identifying the various super-tasks to be
performed, and breaking these down into sub-tasks. It also means identifying the
milestones that mark completion of each super-task. Only then is it possible to allo-
cate the resources necessary to complete the major tasks. Here, a task is any devel-
opment activity that produces a clearly identifiable result.
Partitioning the product is required to identify sub-tasks before determining
super-tasks. Generally, the hardware configuration andlor the system architecture of
a product can be divided into a number of partitions reflecting the parts/subsystems
and technologies to be utilized in the product. In this context, a partition can be any
set of functions that delineate a sub-task. The process of partitioning the project
enables sub-tasks to be identified and set up corresponding to the partitions. Parti-
tions for a CDPlayer follow:
A CDPlayer: Remote controller, Microcomputer, Signal pick-up head, Audio am-
plifier, Power source, Drive motor, Speaker, etc.
5.2 Splitting a super-task into sub-tasks
In concurrent engineering, sub-tasks are identified by developing a set of partitions,

as above, and are performed according to the overall schedule. Concurrent engi-
neering is distinguished by performing these sub-tasks simultaneously and in paral-

lel to the maximum extent permitted by available resources.
Before concurrent engineering begins, the project leader divides each super-
task into a number of sub-tasks for its effective implementation of concurrent engi-
neering, based on the foregoing partitioning. The project leader then co-ordinates
the tasks, allocating resources for each individual sub-task and assigning due dates
for completion. For certain sub-tasks, it is important to obtain the participation of
other companies who are the leading experts in the technologies involved in those
sub-tasks. Such co-operative development with other companies in this way forms
what has been called a "virtual corporation."
5.3 The process of development
Development using concurrent engineering is composed of both iterative and in-

cremental development, as explained below.
(1) Iterative Development
Iterative development is used in the validation of the transcendental hypotheses
associated with the sub-task: the results are reviewed and the hypothesis modi-
fied as necessary, with this process being reiterated until a conclusion is
reached.
When the tasks of iterative development are performed simultaneously, in
parallel, the transcendental hypotheses can be rapidly validated and errors
elirninated while getting feedback from different experts and users and making
improvements.
We have two sayings that encourage the use of this pragmatic approach: "The
road to the truth is lined with rnistakes," and "If you don't make rnistakes, you
won't make anything."
The word iterative is used to legitirnize the abandonment of any rigidly pre-
deterrnined order in perforrning tasks. It is recommended that the order should
be changed flexibly as dictated by the current situation.
(2) Incremental Development
As its name suggests, incremental development proceeds in small increments to
produce effective results quickly. Here, too, there are sayings that suggest its
applicability: "Do not attempt to perform a difficult, complex task in a single
leap. Take it one step at a time, and check your progress every step of the
way."
For incremental development, the partitions must be defined so clearly that as
each associated sub-task is completed, the partition itself can be tested and
validated, along with its interface with other, already completed, partitions.
Note that the assessments of each step of the development are bound to have
an effect on the later sub-tasks.
5.4 Prototyping
Prototyping, within the development process, is the creation of a preliminary, in-

complete and perhaps scaled-down version of the intended product. It is an impor-
tant means of showing users and sometimes colleagues working concurrently on key
parts of the system and getting their feedback before development is complete.
In the era of analogue circuitry on printed-circuit boards, the lead time for
prototyping electronic circuits determined the lead time of the whole development,
which typically took from one to two years. Recently, it has become possible to
create a prototype with much shorter lead times by making full use of computer
systems.
Moreover, you can speed up prototyping by reusing existing service-
sets/objects provided you use service-oriented technology in an appropriate envi-
ronment.
Be aware that teams get excited if the first prototype works weil, but are more
likely to make amistake in the next phase. Moreover, since speed is the key element
of rapid prototyping, it is not always necessary for the prototype to be of high
enough quality to ensure good long-term maintainability.
6 COLLECTNE GENIUS
6.1 What is collective genius?
Organizations with collective genius are those in which the top specialists meld
their individual expertise to fulfill their shared objectives. The concept of collective
genius has a long history in the United States. The many specialists who shared
NASA's goal of putting a man on the moon achieved spectacular success, and form
a representative model of collective genius. We do weil to note that a project quite
impossible for an individual of genius becomes possible when the top specialists of
many fields cooperate.
Traditional specialists have certain weaknesses. In most enterprises and re-
search institutes, the technologies are divided up into too many tiny specialities, and
each special ist functions as an individual 11 star. 11
A collective genius cannot be created just by collecting these stars and encoUT-
aging them to adopt a better attitude! The first prerequisite is to master the process
of abduction using transcendental hypotheses. When those who form the collective
genius have mastered abduction, you no longer get the defensive responses of the
over-specialized experts of the past. Collective genius inspires aggressive, positive,
independent, autonomous comments that are made from a wide perspective. WithiTl
the collective genius, the specialists treat each other's goals as transcendental hy-
potheses, and you can expect a synergistic effect from their interaction.
Another prerequisite for creating collective genius is to give the experts the
weapons they need-the cooperative working environments using advanced infor-

mation technologies such as pes Iinked by intranets. Deprived of weapons, they
will be like the Japanese armies towards the end ofthe Second World War.
If, on the other hand, you use an intranet to link together specialists across
organizations and over long distances, you can create a collective genius. Those
who participate in the collective genius share a common database, use service-
oriented technology as their common language, and effectively pursue common
objectives. Service-oriented technology provides a language that prornotes not only
dialogue between the specialists from different fields who constitute the collective
genius, but also communication with the manager and others responsible for direc-
tion. The workplaces that provide this kind of cooperative working environment are
what we call information-oriented offices.
One final requirement for the creation of collective genius is a flat organiza-
tional structure. Only in this kind of organization can each specialist work unhin-
dered towards an ideal. This is impossible in traditional hierarchical structures. The
flat organization is Iike an orchestra in which top musicians perform under the lead-
ership of a single conductor. The orchestra-type organization is the topic of the next
section.
6.2 A flat, orchestra-type organization
In an orchestra, each member's personal contribution is of critical importance. The

overall performance of an orchestra is a delicate mixture of superb, exquisitely
refined performances by many different instruments. The conductor makes the
whole greater than the sum of the parts, although a poor performance by a single
player will seriously impair the whole.
The ideal organization for the collective genius that challenges the unknown is
flat, like a symphony orchestra.
(1) It pursues a common goal, and is not merely technology driven.
(2) The project leader gives the lead in creating a new product, like the conductor
of the orchestra, for he combines the individual abilities of his team members
to create something that is greater than the sum of its parts.
(3) Evaluation is based on actual performance, not potential.
The success or failure of a flat organization depends on how weIl the means of
information transmission and exchange are implemented. The environment must
encourage not only formal reports but informal exchanges of information about
development activities and active dialog between experts. This kind of environment
is found in information-oriented offices linked by the intranet, for it can collect
these kinds ofinformation and transmit thein quickly and correctly. Moreover, it
speeds senior management decision-making by increasing the speed of information
transfer.
7 CONCLUSION
The ultimate benefit of intranets will be to harness the power of collective genius
while on a practicallevel providing a powerful means to publicize the goals and
targets of a project and to solicit broader participation causing the following shifts
towards democratization:
(1) From commands and controls towards self-determination of central issues and
collaboration with others
(2) From authority based on position to authority based on knowledge
(3) From vertical communication to horizontal communication
(4) From mistrust and obedience to trust and sincerity
This democratization engenders the collective genius and it is this collective genius
that creates ideas by abduction and develops new products rapidly integrating these
ideas by concept engineering, concurrent engineering by making full use of ad-
vanced information technologies.
8 REFERENCES
w. H. Davis (1972), Perice's Epistemology, Martinus Nijhoff, The Hague.

Toshio Itoh (1996), A New Approach to Future Enterprises, Ohmsha Tokyo.
Toshio Itoh, Teruhisa Ichikawa, Hitoshi Ogata, Tadatoshi Yamada (1996), Tech-
nology for Information-Oriented Society.
9 BIOGRAPHY
Toshio Itoh received B.S and Doctor degrees in engineering from Kyoto University,
Kyoto, Japan, in 1954 and 1962, respectively. Since 1954, he has worked for Mis-
tubishi Electric Corp .. He was a director from 1986 to 1996 during which he be-
came successively the roles of General Manager of Manufacturing Development
Laboratory, Central Research Laboratory, Corporate Engineering, and of Corporate
R&D. Presently he is an adviser of Mitsubishi Electric Corp.
PARTTWO
Next Generation Manufacturing

Systems and Production
Management
5
Next generation manufacturing
systems (NGMS) in the IMS program
Takeshi Okabe
Fuji Electric Co., Ltd.
1-12-1 Yuraku-cho, Chiyoda-ku, Tokyo 100, Japan
Tel: +81-3-3211-9409 Fax: +81-3-3211-3664
E-mail: kenokabe@fujielectric.co.jp
Peter Bunce and Ray Limoges

Consortiumfor Advanced Manufacturing - International
3301 Airport Freeway, Suite 324, Bedford, TX 76021 USA
Tel: + -716-475-7703 Fax: + -716-475-5250
E-mail: peter@cam-i.demon.co.ukandrslimoges@acol.com
Abstract
The International Intelligent Manufacturing Systems (lMS) Program is an
important program of cooperative research projects, one of wh ich is the Next
Generation Manufacturing Systems (NGMS) project. NGMS seeks to develop the
technologies and methodologies needed for the manufacturing systems that will
support the next generation of manufacturing enterprise. NGMS is integrating
thinking on advanced manufacturing systems from Europe (the fractal factory),
from Japan (autonomous and distributed manufacturing systems, biological
manufacturing systems) and the United States (agile manufacturing). We give an
overview of requirements for NGMS and a summary of the applied research the
project is undertaking.
Keywords
advanced manufacturing systems, intelligent systems, fractals, agility

44 Part Two Next Generation Manufacturing Systems
1. INTRODUCTION
NGMS are will support the product life cycle within NGMEs (Next Generation
Manufacturing Enterprises). That is, NGMS will integrate a dynamically changing
collection of self-organising, autonomous but co-operating, distributed work units
executing the processes that relate specifically to products and their development,
production, distribution, maintenance, field enhancement, and disposal. These
processes will have to be integrated and supported at the Enterprise Level, Factory
Level, and the Factory Floor. (Additional systems, integrated at a high level with
NGMS, will support the other processes of an NGME.)
The proposed project was endorsed by the International1MS Steering Committee
in September 1995, and work begun at the NGMS International Conference in
February 1996. The project objectives will be accomplished in a set of tasks
clustered in three work-packages, which consists of the several tasks.
2. THE INTELLIGENT MANUFACTURING SYSTEMS (lMS)

PROGRAM
The IMS Program was conceived in Japan in 1989 as an international, industry-

driven, program of collaborative research and development (R&D). After
negotiations, the Japanese proposal was accepted on a provisional basis and a set
of test cases begun in 1993. After further negotiations, AustraIia, Canada, Japan,
Switzerland, and the United States agreed to Terms of Reference (ToR) for a fuH
scale, 10 year program that began in 1995. (As of June 1996, the European Union
is expected to ratify the ToR momentarily). In parallel, the Japanese IMS
Promotion Center established a Domestic Japan IMS Program. In September 1995,
the IMS Steering Committee endorsed the first full scale projects. The IMS
Program is comprehensive, with major technical themes that span the needs for
manufacturing enterprises of the early twenty-first Century:
Total Product Life Cycle lssues, including future general models of manufacturing
systems
Process lssues, including process technology innovation, more flexible andFfiore
autonomous processing modules, and better interaction and harmony among
various components and functions.
Strategy/Planning/Design Tools, including methods and tools for business process
re-engineering, to support the analysis and development of manufacturing
strategies, and to support planning in an extended enterprise or virtual enterprise
environment.
Human/Organisation/Social lssues, including improved capability of
manufacturing workforce/education, training, autonomous offshore plants, and
corporate technical memory.
Next generation manufacturing systems (NGMS) in the IMS program 45
VirtuaVExtended Enterprise lssues
3. NEXT GENERATION MANUFACTURING ENTERPRISES

(NGMES)
Next Generation Manufacturing Systems (NGMS) will support NGMEs. NGMEs

have been characterised (Jordan, 1994a) as dynamically combining customers,
multiple design and production entities, and suppliers, into organisations that will
form to meet a customer need, fulfil the need, and then dissolve. NGMEs are
expected be the dominant form of manufacturing enterprise in a time of
unpredictable competitive challenges and a rapidly, chaotically, changing global
business environment.
The important elements of Next Generation Manufacturing Enterprises are:
• NGMEs will be customer-driven. Customers will be deeply integrated into all
aspects of the product cyc\e.
• Suppliers will be integrated into the product cyc\e. Sub-system suppliers,
especially, will become peers.
• As ilIustrated by much of the thought about NGMEs - for example, the
thinking underlying the Japanese Autonomous and Distributed
Manufacturing Systems and Biological Manufacturing Systems efforts
(IMS93-II-l Group, 1994, the Fraunhofer Society's Fractal Company
(Warnecke, H.-I., 1993), and the D.S. Agile Manufacturing activities
(Nagel, R, et. al. , 1991)., and the view of the factory floOf -
R.,et.al., 1991 ).,and the view of the factory floOf -rigid, static, hierarchical,
manufacturing enterprises will be replaced by virtual enterprises exhibiting
great adaptability to rapid change and able to produce small lots with high
quality and at low costs.
• NGMEs will be made up of simple, distributed, autonomous but co-operating,
work units, that will work in flattened, network-like, organisations.
• The global economy and the technologies for tele-collaboration will both
require and enable work units to be distributed globally.
4. NGMS ARCHITECTURE
Four concepts - Agile Manufacturing, the Fractal Company, Bionic Manufacturing

Systems (BMS), and Autonomous and Distributed Manufacturing Systems
(ADMS) - provide the basis for the NGMS architecture. Each of the concepts -
being developed in different parts of the world - contributes to meeting the
requirements of highly adaptive NGMS able to support competitive, agile,
manufacturing enterprises. Each assumes that NGMEs will be organised into
distributed work units with a high degree of autonomy and intelligent behaviour.
The concepts deal with different aspects of manufacturing systems; the R&D will
reach fruition at different times, but the combination of these four views is a
powerful, representation of advanced manufacturing systems.
NGMEs will have fewer levels of hierarchy and will have information systems
capable of conveying floor level information throughout the enterprise. Time
constraints will make it important for the enterprise to have an accurate
understanding of the status of the floor level operations in order to make timely
decisions affecting enterprise level activities. Because of this, NGMS will be more
tightly integrated across the floor, factory, and enterprise levels. It will be difficult
to decompose NGMS in the traditional hierarchies or levels and so it is important
to take the best ideas at all levels and bring them together in a unified view of
NGMS.
Agility provides a philosophical basis for NGMS. Agility speaks to the capabilities
of an enterprise to reconfigure itself quickly in response to sudden changes, but in
ways that are timely, cost-effective, of abroad scope, and robust. Agility theory
seeks to provide metrics for business processes, for physical operations, and for
human resources to res pond to rapid and unpredictable change. The emphasis on
agility implies that time must be treated very carefully in NGMS models and
simulations, and that NGMS must inc1ude instrumentation and analysis tools for
work unit, factory, and enterprise level measures.
The Fractal Company describes an organisation, made up of self-similar, self-
organising, autonomous work units (jractals). A strength of the Fractal Company
concepts is the guidance they give to business process re-engineering, to the
propagation of goals, and to the human element in NGMEs. Although work units
will have wide latitude about how they accomplish their tasks in the virtual
manufacturing enterprise, they will have to align their goals with those of the
enterprise. Fractal Company R&D is building a manual methodology for goal
setting and propagation (termed navigation) in enterprises organised into
empowered work teams. This methodology appears also to be applicable in more
loosely coupled enterprises.
Autonomous Distributed Manufacturing System (ADMS), suggested in Japan,
aims to realise the autonomous distribution of modules of manufacturing system,
by giving intelligence to each of the modules. Here the manufacturing system is
composed by module units, which are functioning autonomously and co-
operatively, and are integrated into a virtual production system.
Biological Manufacturing System (BMS), which is the further advanced concept
of ADMS, have the functions imitating those of biological organisms, such as self-
organisation, self-recovery, self-growth and evolution, and will provide the
methodology covering all the levels. Here we intend to realise the manufacturing
system which can quickly respond to needs and is harmonious to natural
environment, by systematising the information of a product throughout its wh oie
life cycle, which consists of planning, design, production, consumption and

disposal.
In this research we try to develop decision support system, and architecture
wh ich provides common frameworks for it, tor manufacturing system in the course
of transitions starting from the current concentrated manufacturing system to
autonomous distributed manufacturing system, and further on to biological
manufacturing system.
Virtual Enterprise
The Vision ......- level
_ ~actory level
Operational
Building --
Blocks
Figure 1 The cubic structure integrated with four concept
5. THE NGMS IMS PROJECT: DESCRIPTION, MODELLING AND

SIMULATION OF NGMS
In late 1993, an international partnership of leading manufacturing companies,

supported by a strong group of research universities, came together to set an R&D
agenda whose results will be the technologies, methodologies, and sub-systems
needed to transform today's manufacturing systems into the ones that will best
support NGMEs.
Building on an excellent base of work in Europe, Japan, and the United States,
the partnership developed a comprehensive R&D agenda that spans the product
life-cycle and all key issues in manufacturing. Working through the agenda will
take a decade.
The first set of tasks on the agenda form the basis for a proposal made by the
consortium to the IMS Program, a proposal called Description, Modelling, and
Simulation of Next Generation Manufacturing Systems (NGMS): Merging the
Agile, Autonomous and Distributed, Biologieal, and Fractal Manufacturing
Systems Concepts. The proposed project was endorsed by the International1MS
Steering Committee in September 1995 and work begun at the NGMS International
Conference, held in Irvine, CA, USA, in February 1996.
The goals of the NGMS IMS Project are to:

• develop a unifying description of NGMS, an NGMS Spec+fication that
captures the results of the individual R&D activities, and a framework for
ensuring the integrability of the results into cost-effective NGMS.
• develop on-line facilities for tracking and presenting advanced technologies
and processes and advanced materials that will be used in and by NGMS,
gauging their readiness for application.
• develop an integratable set of models and simulations merging a bottoms-up
view of the factory floor as it will be found in NGMEs with a top-down view of
the globally distributed virtual enterprises.
The unique strength of the NGMS IMS effort is its systems approach. Starting with
the NGME vision, the effort has adopted a needs-based understanding of the
characteristics of future manufacturing systems and has defined an R&D agenda to
develop the best ideas on advanced manufacturing systems and integrate them into
NGMS. The key issues of NGMS have to do as much with the integrability of
manufacturing technologies and processes.
6. WORKPACKAGES AND TASKS
The Project objectives will be accomplished in a set of tasks clustered in three

Work-packages.
6.1. Workpackage 1
This Work-package will provide the framework for the NGMS IMS effort
Task 1.1. Description 0/ NGMS, will provide a standard description of NGMS,
with key words defined and key concepts described, using the four central
concepts, augmented with additional ideas on advanced manufacturing systems.
Where different words are used to describe similar concepts, a mapping will
provide a shared understanding of the vocabularies used to articulate the concepts.
Task 1.2. Specijication 0/ NGMS will maintain the NGMS Specijication as a
timely and complete documentation of the vision and functions of NGMS and as
the definitive statement of the context in which the NGMS IMS Program's work-
packages and tasks will be pursued. The updated Specijication will become a
progressively more detailed description of NGMS as the results of a succession of
work-packages performed by the NGMS IMS effort are integrated into it.
Task 1.3. NGMS Systems Integration has two sub-tasks. In the first, cross-
Regional task team is developing and maintaining an NGMS systems integration
framework, considering both horizontal integration (e.g., the things that relate to
the floor level) and vertical, integrating functions at the floor, factory, and
enterprise levels. The task team will identify inconsistencies and ambiguities
among the work-packages; where appropriate, it will recommend interface
specifications for ensuring NGMS integrability. In the second sub-task, the cross-
Regional task team will identify requirements for one or more systems integration
test-beds where the integrability of NGMS IMS Program work products can be
evaluated.
6.2. Workpackage 2
We will speed the application of advanced technologies, methodologies, systems,

and materials by developing public1y accessible knowledge bases usable by
process engineers. The intent is to package knowledge developed by the partners in
the NGMS effort, by other IMS projects, and from other sources into an on-line
system, called NGMnet. The knowledge bases will inc1ude adescription of the
innovative technology, methodology, system, or material, implementation and
experience information, and an assessment of the risk of adoption. sign. A second
sub-task will develop an interactive, on-line, Handbook 0/ Standard Fixes. New
technologies often are buggy, but be made reliable and useful when used in
restricted ways or with the application of a small patch. The discovery of the fIXes
to the bugs can be a time-consuming process that is repeated as companies attempt
to use the new technology. The Handbook will provide a vehic1e for process
engineers to record and propagate the fixes they discover and for other process
engineers to access fixes as (or before ) they encounter bugs.
6.3. Workpackage 3
There are four tasks involving modelling NGMS from four different perspectives.
These fOUf tasks will be conducted primarily as Regional tasks; a cross-Regional
task will ensure that the tools used (e.g., object-oriented modelling tools) are
consistent and that resultant models present a consistent representation of NGMS.
Task 3.1. Modelling and Simulation 0/ Agile Manu/acturing Systems is derived
from on-going work in Autonomous and Distributed Manufacturing Systems
(ADMS) being conducted under the Japanese Domestic IMS Program IMS9502. In
this task we are developing Position of ADMS in NGMS
ADMS aims to fulfil the characteristics that are required in NGMS, such as
flexibility, quick response, adaptability, globality, and concurrency. The system
configuration of ADMS is autonomous and distributed, and its aim is co-operation
and harmony.Viewing ADMS from NGMS as a whole, it focuses mainly on the
production phase among the life cyc1e, which inc1udes development, design,
production, physical distribution and post-sales. The subject of the research is
modelling and operation in the phase.
• Modelling of ADMS
Modelling provides the basis for the realisation of ADMS, and it corresponds to
the architecture of information processing. In the research on ADMS, we develop
three kinds of modelling tools. They are STN(Scene Transition Net), Agent Net,
and Job Model. Their common bases are the object-oriented technology, the
discrete system theory, and the dynamic system theory.
STN is composed as a hybrid system that is able to integrate and deal with both
continuous and discrete events. It aims to take in and integrate models that are
based on even more different aspects, and to perform a wide range simulation of
manufacturing system.
Agent Net aims to be applied in real-time control and scheduling, by merging
Petri Net and object-oriented technology, and combining functions of co-
operation, learning and self-organisation.
Job Model aims to be applied in intelligent communication, which is to support
computer-aided manufacturing in autonomous and distributed way. It attempts to
take human factors into traditional product models and factory models.
• Operation of ADMS
Operation refers to the decision support on manufacturing system, which is
realised on the basis of modelling technology, and involves actions such as
communication,
contro\, and scheduling.
(a) Autonomous Distributed Scheduling
Development of a scheduling system wh ich has the function to pursue self-
optimisation in each individual process, and to simultaneously co-operate with
other processes and aim for total harmonisation.
(b) Autonomous Distributed Control
Development of control technology for autonomous distributed manufacturing
system, which has robustness to troubles, flexibility, and easiness for construction,
by using Agent Net.
(c) Intelligent Communication
Development of intelligent way of communication to realise HIM(Human
Integrated Manufacturing), which is an advanced form of CIM that harmonises
machines and humans, by using Job Model.
Task 3.2. Next Generation Enterprise Modelling, Simulation, and Operations

will develop new forms of enterprise models that will provide assistance in ~he
formation, transition and management of NGMEs. The task will focus on the
relationships and communications between individual autonomous work units
when they are either participating in a single enterprise or participating
simultaneously in several virtual enterprises. This task will focus on identifying the
right partners and the right interfaces among partners in an NGME.
Task 3.3. Modelling for Biological Manufacturing Systems will establish basic
models for Biological Manufacturing System (BMS). It is well-known that for
NGMS, a manufacturing system with autonomous distributed function is required.
However, it is not always the right way to construct it as an extension of traditional
method. The methodology of system construction is an important point, for it is
inevitable for NGMS to be in harmony with society and nature.
BMS is "a manufacturing system learning from and living with biological life."
By introducing into artifacts the excellent ability of biological Iife, such as self-
recognition, self-growth, self-recovery, evolution and adaptation, BMS conceives
interactions between human beings and artifacts, and furthermore, tries to locate
artificial system in the macro ecosystem, covering the whole Iife cycle of a
product, i.e. planning, design, production, operation, maintenance, recycling and
disposal.
Figure 2 shows the entire view of the research on BMS. Considering the life
cycle, its topics can be Iisted up as folIows:
(I) BMS Core System
Research mainly based on the way to construct a Biological Product Model(BPM),
which is a key to BMS, in an attempt 10 obtain a basic mechanism by which
biological characleristics are applied.
(2) DNA-Oriented Design System
Research on evoluting-type design by using biological product model.
(3) Biological Information Processing Function
Research on information processing function that biological facilities are supposed
to have, focusing mainly on production stage.
(4) Product Life Cycle Feedback
Research on heredity and evolution of a produCL
(5) Harmonisation with Macro Ecosystem
Research on total Iife cycle including disposal and recycling, by using simulation,
etc.
Although the above research topics are closely related with one another, we intend
to concentrate mainly on the topics (I ),(2), and(3)for the time being .
• BPM ConfiguNl.ion .l);,~gn Sa-Mrio Bo",,1 00 BPM eOeYekll'rTlPnt ollnG:t~lion

e<koll("l'l;ltinn M"C;ho1mi,.qq or l)NA~ Sy.;Inm
e<~I1(·..()ri(>n(od (A~I'lf,."J'I. I'rocr",lng PuoctiooB
t)'l)l!.lnJ\H'lMl ioß .IA"'I-iign Ev,üWot.tion S~t('m i\j~,"" ,ri.,. ro. ßioIt'lli<><1
.Mttnuracturing Dllhtll;/tlo(' ~iHnurH(..'1U~ f"ACilitiei;
Art:hittlCl\1re
.irnt'lio;:Hr'WI":YOIutMlnurll~ .1A.,_I,",II~<)d< •
l~n:doc1 • "",,,11 ur,'<)de 5<mullllo,
.I1N"YI.. Iß~"""'ion 1l<6,,'..... n'
Figure 2 The entire view of the research on BMS

Task 3.4. Modelling for Virtual Enterprise will develop models to help in the
formation and management of virtual enterprises, considering both the enterprise
as an entity and individual work units that may be participating in several virtual
enterprises. The models will iIIuminate the decision points in the enterprise life-
cycle; e.g., to illuminate the decision to combine to offer a product at a competitive
target price and to assist individual autonomous work units in their decisions to
corilmit to participation in multiple enterprises.
Task 3.5. Modelling Tools and Model Integration will establish the mechanism
to integrate the four modelling tasks. There are two major integration sub-tasks:
tools and models. Each assumes that the modelling tools will be based on the
object-oriented programming paradigm and each has object oriented tools under
development. An objective of this task is to ensure that the tools are compatible,
that their semantics and interfaces are consistent. A set of NGMS IMS Program
standards, that will inform the establishment of international standards and
conform to them once established, will be developed by a cross-Regional task
team. Each of the modelling tasks assumes that work units will conduct
negotiations as they co-operatively reach decisions relating to the enterprise ' s
goals and their individual roles in meeting those goals. A cross-Regional task team
will find the commonalties among the algorithms and methodologies used in the
other tasks to find optimisations and to help establish standards.
As the four concepts of Agile Manufacturing, Autonomous and Distributed
Manufacturing System, Biological Manufacturing System, and Fractal Company
mature, each will contribute toward a unified view of NGMS. Our assessment of
the way these concepts will mature over time is shown in Figure 3. At any given
time, the next generations of manufacturing systems will be a combination of the
most useful ideas coming from the four concepts. The combination will change
over the lifetime of the NGMS IMS Program.
MATURITY
The Next Generation Manufac\uring Enterprise Vision

Global Distributed Autonomous Change
Coarse·Grained
Autonomous~tribute,d
/ A ·1
/ 91 e
/
Systems~ / Virtual /
/ / / Enterpris~
The Fractal / / ~ /
compan~"""""-::>- /"' ___ /"' /"' / ___ / \
--- --- Fine-Grained
--- Autonomous Distributed
'Biologieal" Systems
TIME
Figure 3 The way four concepts will mature
7. OPERATION AND MANAGEMENT STRUCTURE FOR THE

INTERNATIONAL COOPERATIVE RESEARCH
The administrative management of this IMS Project is the responsibility of the

NGMS IMS Program Office, as international co-ordinator, and the Regional Co-
ordinating Partners. The Program Office is responsible for co-ordinating the inter-
Group aspects of the Program and will be the Program's liaison with the
International1MS Steering Committee and with the International1MS Secretariat.
The NGMS IMS Program is organised as shown below:
Executive Committee
Steering Committee
:"A'"
: us
tralia"":"::
~- .............
Group .~
;"Ä";
, ,
Coordinating Partner
I. International: CAM-I NGMS IMS Program Office
A. Australian Group: Expected to join in the near future
E. European Group: CAM-I European Office
J. Japanese Group: Fuji Electric Co., Ltd.
U. The Group in the United States: CAM-I NGMS IMS Program Office
Figure 4 The NGMS IMS program organisation
8. CONCLUSION
The first results from the NGMS R&D program will be available in 1997; others
will flow in the next two years. Taken together, the results will lead to a
transformation of the NGMS partners' manufacturing systems into those that can
support fast-moving global enterprises in rapidly changing and very competitive
markets.
9. REFERENCE
IMS Promotion Centre, (1995)(1996)(1997), Summary Report: Development of

Intelligent Information Architecture and Processing Technology for Next
Generation Manufacturing Systems
Kawada, S., Kawata, S., & Watanabe, A.(1994),' The discrete/continuous hybrid
simulation using the scene transition net: Proceedings of First Asian Control
Conference', Vol.l, pp.567-570
Kawada, S., Kawata, S., & Watanabe,(1994)'A manufacturing system modeling
using a scene transition net: New Direction in Simulation for Manufacturing
and Communication', pp.86-92
Nagao, Y.(1994),'Net based cooperative control for autonomous distributed
systems: IEEE Symposium on Engineering Technology & Factory
Automation'
Igoshi, M.& Tateno, T.,(l994), 'Modeling of human integrated CIM: Proceedings
of 2nd Symposium on Mechatronics'
Ueda, K., Vaario, J.& Ohkura, K.,(1997), 'Modeling of biological manufacturing
systems for dynamic reconfiguration: Annals of the CIRP', 4611.
Gohtoh, T., Ohkura, K.& Ueda, K.,(l996) 'An application of genetic algorithm
with neutral mutation to job shop scheduling problems: Advance of in
Production Management Systems', IFIP WG5.7,563
10. BIOGRAPHY
Takeshi Okabe received bachelor of engineering in Precision Engineering from

Hokkaido University, Hokkaido, in 1964. From 1964 to 1974, he was a Production
Engineer in Tokyo factory of Fuji Electric Co., Ltd., Tokyo, Japan. From 1974 to
1979, he was in representative office of Fuji Electric in Karlsruhe, Germany and
from 1979 to 1995, he was engaged mainly in production technology in the field of
electronics. Since 1995, he is a General Manager of Production Technology
Division in Fuji Electric's headquarters in Tokyo.
6
Biological concept of
self-organization for dynamic
shop-floor configuration
Jari Vaariot and Kanji Ueda t
t NTT Human Interface Laboratories

Hikarinooka 1-1, Yokosuka, 239 JAPAN
Tel: +81-468-59-8119, Fax: +81-468-59-2332,
E-mail: jari@nttcvg.hil.ntt.co.jp
t Department of Mechanical Engineering, Kobe University

Rokko Nada, Kobe 657, JAPAN
Tel: +81-78-803-1123, Fax: +81-78-803-1131,
E-mail: ueda@mech.kobe-u.ac.jp
Abstract
In this paper we propose a new simulation method for dynamic shop-floor lay-
out configuration inspired by biological systems. Simulating the mechanisms
of biological systems we explore the possibilities for self-organizing an assem-
ble line, where the shop-floor layout is the result of self-organization. This
research is apart of the wider concept of biological manufacturing systems.
The results show that the proposed ideas are feasible for modeling a small
scale assembly tasks.
Keywords
Intelligent manufacturing system, biological manufacturing system, self-organi-
zation, dynamic configuration, shop-floor layout
1 INTRODUCTION
A new research field in computer science, artificiallife (Langton, 1989; Brooks

and Maes, 1994; Moran, Moreno, Merelo and Chac6n, 1995), has matured to
be applied to various engineering problems. In this paper some results of
artificial life research will be applied to manufacturing domain following the
general proposal of Biological Manufacturing Systems (Ueda, 1994; Ueda and
Ohkura, 1995; Vaario and Ueda, 1996b; Ueda, Vaario and Ohkura, 1997).
Artificiallife field has a long history oftheoretical thinking. However, it was
Advances in Production Management Systems N. Olono, H. Tamura & S. Fujii (Eds.)

untillate 1980s when the current computer technology provided the needed
possibilities for modeling artificial realities and studying life-like behaviors.
The focus on the artificial life research has been on how to create au-
tonomous behaviors based on local interactions (bottom-up approach) rather
than defining the global behavior and decomposing it to lower level actions
(top-down approach). The bottom-up approach leads obviously to a local op-
timization. However, the object of this research is not to provide aglobai op-
timization, but to provide a method for dynamic and continuous adaptation.
As it is often the case in advanced manufacturing systems, the key concept
is not any more the global optimization, but the capability of responding
immediately to various disturbances - internal or extern al.
The approach defining only the bot tom level interactions and letting the
global behavior to emerge could be done in various ways. One important
aspect in this is how the environment participates into this process. Having
a mechanism that is effected at least partly by the environmental factors,
we have a method that could be applied to various engineering problems of
modeling adaptation.
The goal is not to design directly the final product, but to design a process
that will produce it. When the environment is part of this process, the environ-
mental changes will effect directly to the final product, i.e. the system adapts
to the environmental changes. The result is a kind self-adaptable system ca-
pable of maintaining a stable, but flexible to new disturbances, organization.
The biological systems are a good example of this kind of systems.
When we apply this concept to manufacturing systems, the problem be-
comes to what is this construction process, and how our intentions could be
defined within this process. In this paper the we describe one possible im-
plementation, and its computer simulation, for the construction process. The
intention part is implemented by combining the top-down (design of prod-
ucts, i.e. requirements) and bottom-up (the actual manufacturing processes,
i.e. capabilities) approaches.
2 GENERAL CONCEPT
In this paper the biological concept is applied at the metaphoric level to the
manufacturing systems. The biological life cycle is shown on the left side of
Figure 1. This cycle could be divided into two parts based on what level
operations are considered. The evolutionary part describes how the genetic
information evolves by the natural selection and genetic modifications. The
developmental part describes the individual sytem to take a shape and main-
taining this in case of disturbances.
This cycle could be applied to manufacturing concept at various levels (Vaario
and Ueda, 1996a). In this paper we concentrate on applying this on a produc-
tion system, where the cycle could be viewed as shown in Figure 1 right.
The intersection of these cycles is at the shop-floor with a problem to de-
Biological concept of selj-organization for shop-floor configuration 57
r-------------------c;1;\'
E.oIuJiOll
,------------.---.. ---. Dt~/opmtni Biologica/ Produc/
r····_·········u.............
u ·l
·. . ·•••• . .
Bio/agica/ ProdUC/;OII
i Gt"t/ic V/JriluiOlls / ' : i Morphogt"tsis

i ('.i i/
l R.Produc:tlon~E/tt~nlJ Pheootype
!
: Pos/-sol.
l N/JI1U'/J1 SrIUM"
:
: Dealh
; l'/P/aSlicity (I'/Jming)
Belumor
: :
!
!
..... --------- -- - ....... _-- .. ! ._--_ ........ -- ---_ .. -- ---_ ...
Figure 1 Biological life cycle and its metaphoric presentation of manufac-

turing systems.
termine where the products are processed . In other words, the problem is
where the product should go and where the manufacturing units should 10-
cate to provide an efficient manufacturing environment, especially when one
consideres the conditions to be dynamic. So how to design a system capable
of creating this from random locations of manufacturing units, maintaining
this in the case of distrubances such as malfunctions in manufacturing units,
and reorganizing this in cases where the product will change.
2.1 Self-Organization
The main focus is on to show how the shop-floor operations could adapt us-
ing self-organization principles with parameters adjusted through these cycles.
The following inclusive list indicates the major points how self-organization
could contribute to adaptive manufacturing systems. Here the manufactur-
ing systems are viewed mainly as cellular systems consisting of transporters
(carrying products) and manufacturing units (processing the products).
• Sell-organization 01 shop-floor layout: Both transporters and manufactur-

ing units are movable. Gradually a layout is emerging from the interactions
between transporters and manufacturing units by minimizing the trans-
portation distances.
• Dynamic schedule: The manufacturing units are static and the goal is to
find out a schedule of transporting products between manufacturing units.
The dynamic schedule means that the schedule is capable of changing in
the case of malfunction of a manufacturing unit, or transporter.
• Adaptation to product demand: The manufacturing system will adapt to the
changes in product demand by re-organizing production line(s), increasing
the number of manufacturing units and transporters, as weIl as modifying
their capabilities. .
• Adaptation to production changes: The manufacturing units are described
by processing capabilities, and products by processing requirements. When
a requirement is changed the production should change accordingly.
In this paper the self-organization of shop-floor layout is described with an

example of dynamic configuration of a bicycle assmbly line.
2.2 Evaluation methods
The evaluation of the properties of adaptive manufacturing systems is a dif-

ficult topic. It is not clear how to measure adaptation and flexibility. The
evaluation methods are still to be developed, but the following approaches
are considered this far.
• The cumulative distance of parts traveled before the final product was
finished.
• The cumulative waiting time of parts before processed.
• The time consumed to finish the final product. This is a combination of
traveling, waiting, and assembling times.
• The idle time of each production unit.
• The lapsed time from ente ring a new product description and receiving a
new product.
• The capability to change the production when the consumption changes.
• The capability of reconfiguration in the case of malfunctions at some pro-
duction units.
3 SIMULATION METHOD
Simulation method is based on a gradient field modeling method. For a com-

plete description see (Vaario, 1994; Vaario and Shimohara, 1995). The idea
is to model a virtual space where the forces (gradient field models) effect the
manufacturing cells and transporters guiding them in the space and deter-
mining their relative locations at each moment, i.e. to create a configuration
of an assemble line.
The forces are the only means to determine the configuration, and they are
also the only method for maintaining the configuration. The forces act locally
and thus implement a bottom-up modeling method.
Each manufacturing unit has attraction fields according to its capabilities.
On the other hand, each part is sensitive for some attraction field that would
satisfy its needs. Thus the capabilities of manufacturing units and the needs
to parts will be matched by simulating continuously the effect of force fields.
This is illustrated in Figure 2.
The continuous simulation approach provides two major advantages over
traditional systems: 1) the production line configuration is flexible in the
means that the simulation creates and maintain the configuration based on
the local information of "needs to be processed" and "capabilities to process" ;
Biological concept of selj-organization for shop-floor configuratioll 59
Global d namics
Local imerf!reled imerpreted Local

dynamics L?' , d namics
Attributes Attributes
~ 4l>
self-modiftes self-modiftes
IJ I1
Manufacturing Transponer with
cell a product
Model
-----------------------Probiem ------------------------
Capabilities .... - - - - ... Requirements
Figure 2 The loeal dynamics vs. global dynamies.
Attraction jield
FO~l~,
r
Combined jield
Repulsionjield
1
radius distance
d;'bn~,
~ FW<'IJ:\--. radius distance
Force
Figure 3 Attraction and repulsion fields with the combined force field.
2) compared with a statie configuration of such a line, the re-configuration

(adaptation) is continuous and autonomous without an explicit decision of
re-configuration.
A simple form of the used attraction and repulsion force fields as a function
of the distance are shown in Figure 3. These fields deseribe the scalar value
of the force vectors effecting between parts and production units. The forces
effect mutuaIly, i.e. if a production unit draws apart for it, a similar force also
effects from the part to the production unit. The actual movement is relative
to the mass of each unit .
Although not applied yet in the field of manufacturing ceIls, the simulation
method allows modeling of dynamic force fields. Thus in the case where a
production unit can not receive its input, it can increase its attraction fields .
In the opposite case, the field value could be reduced if there is plenty input
available. This enable a competition for input between production units.
..:. _____• MC"~
0 . . . . .. . .".,("0
.
1114) f
'0'/
MCdl!IOJ
--~
MC'~
=---- 1
-----
MCdl!S]
r"":P«b1 -----MC'~
.,,~ -~
o MCdJI6) r
,~,,,. ~
o
l'1!.o~ar ~1I13J
0
,/
MC.:1I15)
~I
0':5"0 ~/
MCocllUI
~re ~
/
front frwne - - - - - . . MCdllOI
/
~---~ =-.
Figure 4 Product definitions for a 'flat' and 'hierarchieal' production.
4 A TEST CASE: BICYCLE ASSEMBLE
In the following a detailed description of using the above model for a test case
of a bicycle assemble line is given.
4.1 Product Description
The product model of a bicycle consists of following thirteen kinds of parts:

frame, front frame, handle, front wheel, front tire, rear wheel, rear tire, front
gear, re ar gear, right pedal, left pedal, chain and saddle. In addition there are
several combinations of these parts according to what order the parts are put
together.
Two bicycle models as shown in Figure 4 are tested. The first one (on left)
is designed to be 'flat', and the second one is designed to be 'hierarchieal'.
The difference should be visible in the resulting shop-floor layout.
4.2 Assemble cell
Each assemble cell (see Figure 5 right) generates attractions for two input
corresponding to the above product description. When both input are received
Biological concept 01 selj-organization lor shop-floor configuration 61
Transporter Assembly Cell

.........:::::.-.- ...............
'" Inpu, burren.Jn.. ~'

~~
Oispoctrunl of
basic parts by u.sing lot
10 tnnsporIm Idle «11 ~
Figure 5 Initial configuration where assembly cells are at random locations

(middle) with detail illustrations of assembly cells (left) and transporters
(right).
they are assembled (taking a constant time) and the output is put into output
buffer. The output will be an input to an other assemble cell according to the
product description, or could be an input to the collection point of finished
bicycles . Arepulsion field is used to prevent assemble cells to overlap each
others.
The field dynamics involves only on-off timing . When input buffers are full
the input attraction is turned off. When the output buffer is full, then an
'empty transporter' attraction is raised in order to get an empty transporter
to pick the output . This will be turned off once the output buffer will become
empty.
4.3 Transporter
Each part of a bicycle moves on a transporter (see Figure 5 left) in the shop
floor . Transporters do not have particular trails, but they can move freely on
the shop floor space. They became sensitive to the attraction fields according
to the parts they carry. If transporters do not carry any products they are
sensitive to 'empty transporter' attractions . This attraction is generated by
the factory dispatcher, that dispatches parts to the factory at the left side
wall, or by the output buffers of assemble cells. If there are no attractions
detected the transporters are going around indicating their idle state.
5 SIMULATION RESULTS
The following example provides the first results of the simulation method
applied to self-organize the shop-floor layout (Fujii, Vaario and Ueda, 1997).
The method has been used also to emerge a dynamic schedule for a task of
drilling printed boards (Vaario and Ueda, 1997).
5.1 Initial values
The initial shop-floor space with random locations of assembly cells is illus-
trated in Figure 5 middle.
The dispatching of basic parts was set at the left wall in some distance
from each others. The wall had arepulsion field to prevent assemble cells to
go too far on it. The basic parts were allocated for empty transporters in
linear order so that there was all time the correct ratio of basic parts on the
shop floor. The collection of empty transporters to pick up next parts was set
on the left-top corner. The collection point of finished prod ucts was set at the
right-top corner.
The initial configuration of assemble cell was set random at the right half
of the shop floor area. This was to give the assemble cells time to direct
their movement toward the correct locations before being crowded at the left
side wall. Each assemble cell was given the type of its input to attraet. The
assemble time was set same for each task.
The number of available transporters was set to ten. Transporters did not
use any repulsion field, thus they were able to cross assemble cells and other
transporters. Various parameters to control the movements were found by
trial-and-error approach. The evaluation criteria for this was simply to pro-
duce 'nice-looking' behavior.
5.2 Self-organization of production lines
As a simulation result, the self-organization process of assemble cells on the

shop-floor is shown in Figure 6 (left) for the first type of production. The
initial configuration is random at the right half of shop-floor space. As the
simulation progresses, the shop floor layout is changing gradually. The most
changes are caused in very early simulation steps. A near-to-stabile configu-
ration is reached already when only a few bicycles are fully assembled. After
about fifteen bicycles are assembled the configuration starts to oscillate and
no relative positions are changed anymore.
In the second case the floor layout is reached in same manner from same ini-
tial configuration. However, this time the configuration is completely different
(Figure 6 (right)) corresponding a different assemble order. The resulting con-
figuration demonstrates the capability of self-organizing different production
configurations with relative small changes in the product description. This
provides furthermore the possibility to test what kind of produetion order is
the most efficient.
As one can observe the both shop floor layouts correspond to the product
descriptions given in Figure 4 as expected. In order to to achieve a good
layout the dispatching positions of basic parts have been ordered differently
Biological concept of self-organization for shop-floor configuration 63
Cl
•
~~\
~~ \ ~
Transporter with
a product
Configuration at
the first finished bicycle
...
~-
~
~~(l
~
Empty ~sporter
0:--Working cell
~
Configuration at
~ the eight finished bicycle
Stable configuration
Figure 6 Self-configuration process of the 'Hat ' (left) and the 'hierarchieal'
(right) production line. The first snapshot is taken when the first product
is finished, the second when the eighth product is finished, and the third
snapshot is taken when a stabile configuration is reached .
\\,~-------------------------------
'\-, I
.~._-------~:-~~~::~
a) °\;--0'T,",h.;-;n'-;;<h;;-ro;;.;;;;.",,-;:-;;;pr""oo;;;;u';."""~v-.n-'-d-
••;;;;i~~~CE''' b) 0\--0-T=hoO--n=thC-=r.=.o""w=pr=od=u";,O=-~v-.n-.-o-
••,d~~~ees
Figure 7 The transportation distance between assemble cells for 'n'th prod-
ucts by the a) 'flat', and b) 'hierarchieal' production line _ Arrows in the
graphs show the corresponding snapshots of configuration in Figure 6_
for both cases. Also the numbering of cells is slightly different because they are
performing different assemble tasks (cf. Figure 4 for corresponding numbers)_
5.3 Evaluation and discussion
The graph for evaluating the result, a process of self-configuration during

the simulation of 50 first bicycles by the 'flat' production line and by the
'hierarchieal' production line, is shown in Figure 7.
The graphs represent the cumulated transportation distances for the sub-
parts of 'n'th bicycle. The first and last transportation distances are not in-
cluded in order to measure the relative configuration of manufacturing cells.
This distance is supposed to decrease when a better configuration is reached,
as shown in the graphs.
The fluctuation in the stabile configuration is shown in the graphs by vari-
ations in the measured distances_ Although this fluctuation is unnatural, it
could be understand as a capability of re-configuration in the case of changing
conditions_
The same transportation distance is achieved in almost every time at latest
by the twelfth product assembled_ In some rear cases the manufacturing cells
are blocking temporally movement of each others causing a step in the curve_
Although we cannot guarantee an optimal configuration, the achieved con-
figuration is near the optimal. The main merit of the method is, however,
the fact that the configuration is reached automatically with a capability for
re-configuration in the case of environmental perturbations_
Biological concept 0/ selJ-organization tor shop-floor configuration 65
6 CONCLUSION
This paper described a novel method for self-organization of an assemble line.

The main focus was on the concepts, and the actual results of simulations
and their analysis were left for the future work. The main message on this
paper is that we should imitate the nature's production system, and especially
its capability of self-organizing, self-adapting, self-repairing, self-maintaining,
ete.
The other projects have considered using the approach on dynamic schedul-
ing problems (Vaario and Ueda, 1997; Ueda et al. , 1997; Ueda and Vaario,
1997). Also an interactive factory animation has been tried with a virtual re-
ality implementation (Vaario, Fujii, Scheffter, Mezger and Ueda, 1997). The
selected approach of applying various biological concepts of self-organization
is promising, but a lot of work remains in developing the analysis and mea-
surement methods for the dynamics simulations.
7 ACKNOWLEDGMENTS
The authors thank Mr. Fujii for his help on implementing the simulations of
the example.
8 REFERENCES
Brooks, R. and Maes, P., eds (1994), Artifieial Life IV, The MIT Press.
Fujii, N., Vaario, J. and Ueda, K. (1997), Potential field based simulation
of self-organization in biological manufacturing systems, in 'Proceed-
ings ofManufacturing System Design'97, May 14-16, 1997, Magdeburg,
Germany', LOGIS, Stuttgart.
Langton, C. G., ed. (1989), Artifieial Life, Addison-Wesley Publishing Com-
pany.
Morao, F., Moreno, A., Merelo, J. J. and Chac6n, P., eds (1995), Advanees
in Artificial Life, Springer.
Ueda, K. (1994), Biological-oriented paradigm for artifactual systems, in '1994
Japan-U.S.A. Symposium on Flexible Automation', ISCIE/ ASME,
pp. 1263-1266.
Ueda, K. and Ohkura, K. (1995), A biological approach to complexity in man-
ufacturing systems, in 'Proc. of the 27th CIRP International Seminar
on Manufacturing Systems', Ann Arbor, pp. 69-78.
Ueda, K. and Vaario, J. (1997), The biological manufacturing system: Adap-
tation to growing complexity and dynamics in manufacturing envi-
ronment, 29th CIRP International Seminar on Manufacturing Sytems,
May, 1997, Osaka, Japan, pp. 39-44.
Ueda, K., Vaario, J. and Ohkura, K. (1997), Modeling of biological manufac-
tu ring systems for dynamic reconfiguration, Vol. 46/1, Annals of the

CIRP, pp. 343-346.
Vaario, J. (1994), Modeling adaptative self-organization, in Brooks and Maes
(1994), pp. 313-318.
Vaario, J., Fujii, N., Scheffter, D., Mezger, M. and Ueda, K. (1997), Fac-
tory animation by self-organization principles, in N. M. Thalman, ed.,
'International Conference on Virtual Systems and MultiMedia 1997
(VSMM'97)', Springer-Verlag. (to appear).
Vaario, J. and Shimohara, K. (1995), On formation of structures, in Mor<in
et al. (1995), pp. 421-435.
Vaario, J. and Ueda, K. (1996a), Biological concept of self-organization in
flexible automation systems, in N. Okino, H. Tamura and S. Fuji, eds,
'Proceedings of APMS'96 (Advanced Product Management Systems)',
November 4-6, 1996, Kyoto, Japan, pp. 33-38.
Vaario, J. and Ueda, K. (1996b), Self-organization in manufacturing systems,
in '1996 Japan-USA Symposium on Flexible Automation', July 7-10,
1996, Boston, MA, pp. 1481-1484.
Vaario, J. and Ueda, K. (1997), An emergent method for dynamic scheduling,
The Second World Congress on Intelligent Manufacturing Processes &
Systems, June 10-13, 1997, Budapest, Hungary, pp. 187-198.
9 BIOGRAPHY
Jari Vaario received M.S. degree in engineering from Helsinki University of

technology, Finland, in 1985. He was awarded Doctor in Engineering degree
by the University of Tokyo, Japan, in 1994 while working at ATR Human
Information Processing Laboratories, Kyoto, Japan. From 1995 to 1997 he was
a full professor at Nara Women's University, Japan, and from 1997 he has been
an invited professor at NTT Human Interface Laboratories, Yokosuka, Japan.
His research interests include modeling and simulating self-organization and
emergent phenomena, and applying these into various areas.
Kanji Ueda graduated from Master Course of Engineering, Osaka University,

Japan in 1972. He joined Department of Mechanical Engineering, Kobe Uni-
versity, as a Research Associate, after his graduation. He obtained the degree
of Doctor of Engineering in 1978 from Osaka University. He joined Kanazawa
University as an Associate Professor in 1980, and later he became a Full Pro-
fessor at the same university in 1988. He rejoined Kohe University as a Full
Professor in 1990, and he is now Head of the Unit of Intelligent Machines
and Manufacturing System at Department of Mechanical Engineering and
concurrently the Director of Kobe University Information Processing Center.
7
A basic study on high volume
flexible manufacturing system
for agile manufacturing
Susumu Fujii, Hiroshi Morita
Dept. 0/ Computer and Systems Engineering, Kobe University
Nada, Kobe 657, JAPAN,
Tel:+81-78-803-1203 Fax:+81-78-803-1218
E-mail: lujii@seg.kobe-u.ac.jp.morita@seg.kobe-u.ac.jp
Yasuto Tatsuta
Product and Production Engineering Administration Office,
M azda Motor Corporation
Fuchu, Aki, Hiroshima 730-91, JAPAN
Tel:+81-82-287-4367 Fax:+81-82-287-5163
E-mail: ytatsuta@mazda.co.jp
Yoshiharu Takata
Development and Design Division, Yamazaki Mazak Corporation
Oguchi, Aichi 480-01, JAPAN
Tel:+81-587-95-7796 Fax:+81-587-95-5812
E-mail:mazak@po.iijnet.or.jp
Abstract
We propose a new manufacturing system for agile manufacturing. It is neces-
sary for an agile manufacturing system to produce a large amount and many
kinds of products with high reliability. We propose a new configuration of
manufacturing system, which attains the high flexibility for the high volume
production. The system, named High Volume Flexible Manufacturing Sys-
tem (HV-FMS), consists of machining centers arranged in aserial and parallel
manner. It is also expected to ensure high productivity for the case of machine
troubles. Simulation studies are performed to demonstrate the feasibility and
the effectiveness of the proposed system.
Keywords
Agile manufacturing, High volume flexible manufacturing system, Parallel-
serial configuration, Flow type production
1 INTRODUCTION
In recent manufacturing systems, it is necessary to process many kinds of

products to meet the increasing and varying demand of customers. As a
result, the life cycle of products is becoming shorter and shorter and the
agility in manufacturing is required to respond quickly to the changes not
only in the variety but also in the quantity of products without losing the
high quality (Kidd 1993, Goldman, et al 1995).
The flexible manufacturing systems (FMS) have been introduced to im-
prove the productivity in manufacturing many kinds of products with a small
or medium volume, aiming at medium production capacity in a whole (Ito &
Iwata 1984, Archetti, et al 1989, Raouf & Ben Daya 1995). Because of the
frequent changes in the kinds and volume of workpieces even in the mass pro-
duction such as in automotive industries, it is becoming necessary to develop
manufacturing systems not only the flexibility but also a large production ca-
pacity , which have been provided by dedicated transfer machines (TM) and
flexible transfer lines (FTL).
In this study,we propose a new manufacturing system, named a high vol-
ume flexible manufacturing system (HV-FMS), for agile manufacturing which
attains the high flexibility for the high volume production satisfying the above
requirements. The system consists of machining cells arranged in aserial and
parallel manner, where parallelly arranged machining cells with the same tool-
ing set up form a group to process a certain portion of machining processes.
That particular parallel-serial arrangement of machining cells is expected to
provide both the "high flexibility" of the conventional FMS in job shop, and
the "high productivity" of the transfer machine or the flexible transfer line in
flow shop. At the same time, it is expected to ensure high productivity even
in the case of machine troubles.
In section 2, we discuss the proposed new manufacturing system, HV-FMS,
in detail after abrief description of the development of manufacturing systems.
To study the feasibility of HV-FMS from a viewpoint of design, we perform
a basic research on the manufacturing system which manufactures cylinder
heads. Simulation is extensively used in this study because of its effectiveness
in evaluating various manufacturing systems(Carrie 1988). The simulation
results of the performance of HV-FMS is shown in section 3. Further research
directions and concluding discussion are given in section 4.
2 HIGH VOL UME FLEXIBLE MANUFACTURING SYSTEM
2.1 A new manufacturing system for agile manufacturing
We discuss in this section the historical change of manufacturing system and

the goal of our proposed manufacturing system. As shown in Fig. 1, there are
two major directions that the manufacturing systems have been developed
High volume flexible manufacturing system for agile manufacturing 69
-
Transfer Machille Modular Machine
8
(GM)_ .... ....... .... . (l.I.o~l?~ .~~)...... . .
Special .
Machine Cor·.
t
exclusive use ".
(FORD)
Single FunctioDRI Machine··· ..
Flexibility
Figure 1 Development of manufacturing system
along with the automation: One is to improve the productive efficiency, and
the other is to improve the flexibility for products.
To improve the productivity, single functional machines with high machin-
ing speed and a line production system such as a transfer machine(TM) are
intensively developed for a mass production. Since these systems do not
have high flexibility for the change of products and are appropriate to the
low-diversity production, the flexible transfer line(FTL) was introduced as a
system to provide some flexibility with high productivity.
To improve the flexibility, it is desired to produce many kinds of and small
amount of products to respond the customers re quest and demand quickly.
This led the introduction of multi-functional machining center. Since it is
for job-shop type production, the productivity is not so high. Therefore the
computer controlled flexible manufacturing system and flexible manufactur-
ing cell are intensively developed to improve their productivity keeping the
flexibility(Ito and Iwata (1984)) .
For agile manufacturing, it is becoming more important to pursue both
high productivity and high flexibility. To attain such ultimate goal at the
right upper corner in Fig. 1, a new manufacturing system is so designed to
possess the high productivity of the li ne production system and the high
flexibility of the multi-functional production system at the same time.
C· Transfer controller
Loadin,
Maehlnin. ~II
r l h UnloacliJle
I'lOm(To) t t To(Frorn)
Italion ~JWion
_on
MlChlnina
Earliest Tnnsrcr cmJer

availablcttll ~OM.~
b.
mlterial~~
rlh \~ =:...,~ •••
Asscmbly
• •
• •
• •
C) c=p
Proceuinl Pmcessina
1fO<!p 11. JTOIIP &
Figure 2 The workpiece flow in high volume flexible manufacturing system
2.2 Essential factors of HV-FMS
The essential factors of a high volume flexible manufacturing system (HV-

FMS) proposed in this study are "flexibility" and "productivity". Flexibility
requires the highly mixed production of different type of workpieces, expand-
ability and reducibility in amount adapting the variable demands, and adapt-
ability to the progress in technology. Productivity requires the quick response
for shortening the production lead time and the production preparation time,
and stability and reliability of system.
The HV-FMS is designed for high volume parts production using a par-
ticular parallel-serial arrangement of machining cells. Fig. 2 shows a typical
workpiece flow in HV-FMS. The manufacturing system of HV-FMS consists
of" cells" as the basic units, each of which consists of loading station, machin-
ing station and unloading station. Each cell forms an independent subsystem
and the total system is an integration of these cells. The machining process of
one product is divided into several processing groups. The processing groups
are arranged in aseries and all products are processed according to the order
of processing groups. Machining processes in one group can be achieved by
any machining cell in the group, where the machining cells have flexibility for
processing many kinds of workpieces by providing sufficiently many tools in
the tool magazine or changing tools.
High volume flexible manufacturing systemfor agile manufacturing 71
The raw material stored in the warehouse is loaded into the machining
system, where the production schedule should be dynamically determined
based on the operating conditions of machining cells varying time to time.
The workpieces are transported to a machining cell by automated guided
vehicles (AGVs). The transportation controller should select the machining
cell by which the workpiece is processed and the AGV by wh ich the workpiece
is transported. Dispatching rules such as the earliest available machining cell
and the earliest available AGV, are used for the control in this study.
Multi-functional machining cells are utilized in HV-FMS,where the rate of
machine failure may become larger than the single-functional machine system.
The parallel arrangement of the machining cells with the same specification
,however, will enable to continue the processing by alternative machining cells
when machine trouble occurs. Therefore, it is considered that the HV-FMS is
robust for the machine failure andmaintain the high productivity even under
larger failure rate of machining cell.
3 SIMULATION STUDIES OF HV-FMS

3.1 Purpose of simulation study
The feasibility and effectiveness of the proposed HV-FMS. It is necessary to
test and evaluate the performance of various system configurations by some
means and determine the desirable configration. In the development of FMS,
simulation has been widely and effectively used as reported in many litera-
tures, e.g., (Carrie 1988). We study an HV-FMS which hypothetically manu-
factures the cylinder heads of automobile engines. We consider the evaluating
criteria of the HV-FMS as utilization of processing groups and AGVs, pro-
duction lead time of each kind of workpiece and total amount of production.
We have executed the following three experiments.
1. Clarify the relation between the number of machining cells and product
mix of workpiece, and show the robustness for the change of product
mix of workpieces.
2. Find the sufficient number of AGV.
3. Verify the robustness for machine failure.
3.2 Simulation parameters

The design parameters are the number of machining cells in each process-
ing group and the number of AGVs. The environment al parameters are the
product mix ofworkpieces and the distribution ofmachine failure. In this sim-
ulation model, we assurne to process three kinds of workpieces (I, 11 and 111)
and the machining processes are divided into 5 processing groups (A, B, C, D
72 PartTwo Next Generation Manufacturing Systems
Table 1 The processing times and the number of machining cells in each
processmg group
Processing A B C D E
group (sec) (sec) (sec) (sec) (sec)
Work I 472 389 504 78 240
Work 11 472 445 647 102 353
Work 111 853 502 673 126 466
I: WjPij 535.5 426.5 579.8 94.0 315.3
Ni 10.9 8.7 11.8 1.9 6.4
Ni 11 9 12 2 7
and E). The capacity of loading and unloading stations is assumed to be one.
The AGV can transport one workpiece at a time and is assumed to be failure
free for simplicity. The time for transportation by AGV is assumedto be
normally distributed with the mean of 54 seconds and the standard deviation
of 12 seconds including the loading time, unloading time and transportation
time. And no conflict of AGVs is assumed in this study.
The number of machining cells in each processing group is basically deter-
mined by the following relations.
Hl
Ni (L WjPij)/Ci, i = A, B, C, D, E (1)
j=1
Wj ~ 0, Wl + wH + WHl = 1 (2)
where Wj is the product mix of work j, Pij is the processing time of work
j in the processing group i and Ci is the cycle time of processing group i.
The cycle time is obtained by assuming that the total amount of products
per month is 30,000, the operation time is 480 hours and the expected system
utilization is set to 85%. Then we have
Ci = 480/30000 x 0.85 = 0.0136(hours) = 49(seconds) (3)

The practical data of processing times used in the simulation study are
shown in Table 1, where the number of machining cells are estimated by
using the product mix of Wl = 50.0%, WH = 33.3% and WHl = 16.7%. The
fundamental number of machining cells Ni is given by rounding Ni.
As the dispatching rule for assigning machining cell and AGV, we use the
earliest available rule.
High valumeflexible manufacturing systemfar agile manufacturing 73
3.3 Results of simulating experiments
3.3.1 The number of MCs vs product mix

The first study is how the productivity is affected by the change of number
of machining cells and product mix. The number of AGVs are fixed to three
in each transportation area and no machine failure is assumed. We have
examined four arrangements of machining cells and three types of product
mix as given below. Note that MC I, 11 and III are obtained by eq.(l) with
PM I, 11 and 111, respectively. In MC IV, a machining cell in group E is
reduced from MC I.
• four arrangements of machining cells of five processing groups
MC I (11, 9, 12, 2, 7)
MC 11 (11, 9, 13, 2, 6)
- MC III (10, 9, 13, 2, 7)
MC IV (11, 9, 12, 2, 6)
• three types of product mix of three kinds of workpieces
- PM I (50.0%, 33.3%, 16.7%)

PM 11 (33.3%, 33.3%, 33.3%)
PM III (0.0%, 100.0%, 0.0%)
Figs. 3 show the total utilization ofmachining cells and AGVs, respectively.
Every combinations of MC and PM give the higher utilization more than 85%.
Especially, MC 111 gives comparatively low utilization, which is induced from
that the number of machining cells in first processing group A is smaller than
the other MCs. Then the number of processed workpieces decreases, although
the total number of machining cells are the same. PM 111 gives the highest
utilization for any MCs, since PM III is a single kind production. In general,
every MCs except for MC III are robust against the change of product mix.
The utilization for MC IV is slightly less than that of MC I.
3.3.2 The number of AGVs

The second study is how the productivity is affected by the change of number
of AGVs. The number of machining cells and product mix are fixed to MC
I and PM I. No machine failure is also assumed here. Figs. 4 and 5 show
the utilization of AGVs and machining cells and the production lead time for
each kind of workpiece, respectively.
The utilization of AGVs is in inverse proportion to the number of AGVs and
saturates to 92% when AGVs are less than two. The utilization of machining
I 111 PM 1 .P~U O PM 1I
100%
95%
8 90%
!
::>
55%
SO'"
75'"
Mel Me 11 Me 111 Me IV
AmrIB<menlO( mochlnins cou.
(a)machining cells
7~ r-------~============~
Mel Me 11 Me 111 Me IV
Alnnaement cf machi rti "8 cells
(b)AGVs
Figure 3 Utilization of machining cells and AGVs
cells also saturates to 97% when AGVs are more than three. Moreover, the
production lead time for each work does not decrease for more than 3 AGVs .
Therefore, three AGVs are sufficient in this model to maintain the highest
productivity of this system. If the failure of machines and AGVs are taken
into account, the utilization will decrease and the curves in Fig. 4 should shift
to right . Then the number of AGVs for more efficient operation will increase.
3.3.3 Machine failure

The third study is how the productivity is affected by the machine failure.
The number of machining cells and product mix are fixed to Me I and PM
I. The failure rate of each machining cell is estimated from practical data of
currently operating FMS. The time between failure (TBF) is exponentially
High volumeflexible manufacturing systemforagile manufacturing 75
100% , - - / - : _...
-------
..------'-----41
... ..---,,---;;;-
..-----;--»-------;;;
...-0___=_
90%
80%
70%
!5 60'"
j SOOk
..
!
:= 4C71o
:::. 3C)01o
20%
10%
2 3 4 5 6 7 8 9 10
N umber 01 AGVs
Figure 4 Utilization of AGVs and machining cells
140 , - - - - - - - - - - - - ,
130
120
~
W:rttA
110 -+--W:rtt B
!5 100 , W:rtt C
~ 90
~ 80
70
60
50
40 ~~~~-~~~-~~~
4 5 6 7 10
Number 01 AGVs
Figure 5 Production lead time
distributed with the mean of 430 hours and the time to repair (TTR) is log-
normally distributed with the mean of 3_1 hours and the standard deviation
of 3_3 hours_ We call this failure type as Type L Moreover, we consider two
more failure types as follows_ Type II is more frequently failed than Type I
and moreover Type III takes longer time to repair than Type lL
Type I TBF=Exp(430), TTR=LogN(3_1, 3.3 2 )

Type 11 TBF=Exp(250), TTR=LogN(3_1, 3_3 2 )
Type III TBF=Exp(250), TTR=LogN(7.0, 22.2 2 )
Fig_ 6 shows the utilization of AGVs and machining celk When the time
to repair is short as Type land 11, the reduction in utilizations of AGVs and
.2
...
.
.!;
......
...
=
~
Failure types
Figure 6 Utilization of AGVs and machining cells
machining cells is not serious, that is only 3 to 4%. On the other hand, when
the time to repair is long as Type III, there is comparatively large reduction
in utilization, although the utilization of machining cells is still kept at the
level of about 85%.
4 CONCLUDING REMARKS AND FURTHER RESEARCH

TOPICS
We have proposed a new manufacturing system for agile manufacturing named

as high volume flexible manufacturing system(HV-FMS), which has a parallel-
serial configuration. For a specific product mix with a target production
volume, a appropriate number of machining cells in each processing group is
estimated. Simulation studies shows that an appropriate configuration exists
for different product mixes. The total number of machining cells does not vary
much for the change in the product mix although the number of cells assigned
to each processing group may differ corresponding to the product mix. This
suggests that the proposed system has the flexibility to form the appropriate
configuration by changing the assignment andjor layout of machining cells in
accordance with the change in the product mix. Considering the production
amount of any tested cases were more than the target volume, the productivity
and flexibility of the proposed system can be concluded to be satisfactory.
The study also showed that there exists appropriate number of AGVs con-
necting processing groups, and that the system performance is affected by the
High volume flexible manufacturing system for agile manufacturing 77
machine failure, but the effect of the time to repair is more significant than
that of the time between failure.
To materialize proposed HV-FMS, many problems are left to be studied in
future, some of which are listed in the following.
1. The pallet change between the processing group was assumed to be

made at machining cells but is necessary to develop a practical and
feasible method.
2. Practical method for dynamic assignment of machining cells is to be
pursued for the improvement of the system performance.
3. Extensive studies on the system operation including selection rules of
machining cells and AGVs are essential for efficient system operation.
4. The study from the economic view point of HV-FMS in comparison
with the other manufacturing systems is essential for the feasibility
study to implement the system in the factory.
5 REFERENCES
Archetti, F., Lucertini, M. and Serafini, P., Eds. (1989), Operations Research
Models in Flexible Manfacturing Systems, CISM No.306, Springer-Verlag,
New York, N.Y.
Carrie, A. (1988), Simulation of Manufacturing Systems, John Wiley, New
York, N.Y.
Goldman, S.L., et al. (1995), Agile Competitors and Virtual Organizations,
Strategies for Enriching the Customer, Van Nostrand Reinhold, New
York, N.Y.
Ito, Y. and Iwata, K. (1984), Flexible Manufacturing System, Nikkan-Kogyo-
Shinbun, Tokyo. (in Japanese)
Kidd, P.T. (1995), Agile Manufacturing, forging New Frontiers, Addison-
Wesley Publ., Reading, Mass.
Raouf, A. and Ben-Daya, M., Eds. (1995), Flexible Manufacturing Systems:
Recent Developments, Manufacturing Research and Technology 23, Else-
vier Science B.V., Amsterdam.
6 BIOGRAPHY
Susumu Fujii received B.E. and M.E. from Kyoto University, and Ph.D. from
the University of Wisconsin, Madison, in 1965, 1967 and 1971, respectively.
He joined Kobe University in 1970 and is Professor of Computer and Systems
Engineering at Kohe University. His research interests include computer inte-

gration of manufacturing systems, production planning and scheduling, and
manufacturing system simulation.
Hiroshi Morita received B. E. and M.E. from Osaka University and Dr. E.
from Kyoto University, 1983, 1985 and 1992, respectively. He joined Kohe
University in 1993 after teaching at Osaka Prefectural University and Osaka
City University and is Associate Professor of Computer and Systems Engi-
neering at Kohe University. His research interests are operations research,
efficiency analysis and production scheduling.
Yasuto Tatsuta received B.E. and M.E. from Osaka University in 1970 and
1972, respectively. Hejoined Mazda Motor Corporation in 1972 and is General
Manager of Product and Production Engineering Administration Office.
Yoshiharu Takata received B.E. and M.E. from Tottori University in 1983
and 1985, respectively. He joined Yamazaki Mazak Corporation in 1985 and
is Assistant Leader of Machining Technology Research Center in Development
and Design Division.
8
The collaborative engineering process
within the framework of the virtual
enterprise
M. Williamson, MBA, PMP

Project Solutions
Seattle, WA 98107-4039, USA
email: matt@projectsol.com
Dr. R. L. Storch, Ph.D., P. E.

Industrial Engineering, University ofWashington
Seattle, WA 98195-2650 USA
email: rlstorch@u. washington. edu
Abstract
The virtual enterprise has become a prominent organizational structure under which
small and medium sized enterprises having strong, narrowly focused core
competencies can band together to accomplish large proJects. Great strides have
been made in the evolution of the virtual enterprise as a collaborative engineering
environment; however, in many cases, a key component of the virtual enterprise is
missing that allows for the enterprise to stay focused on project goals, rather than
concentrate on conflict resolution among its members. This component is the
project manager. By having a project manager take responsibility for the
management of the project, the virtual enterprise can maintain its collaborative
environment and its members can remain focused on the goals of the project.
Keywords
Virtual Enterprise, Collaborative Engineering, Project Management. US Marine
Industry

© 1998 IFlP. Published by Chapman & Hall
1. INTRODUCTION
Recent articles in the popular press, as weil as many professional journals, have
pointed to the virtual enterprise as the newest model of the successful organization.
(Caskey, 1995) In defining the virtual enterprise, many iterations have been
developed and discussed. Typically a virtual enterprise takes shape in an
intrapreneurial project team in a large organization. Another common form of the
virtual enterprise is that of a large corporation outsourcing a specific need to or
utilizing particular resources of a smaller consulting firm.
The first of these models is derived from the need of a large enterprise to
accomplish a multi-disciplined project. Representatives from the necessary
functional departments of the organization are brought together to form a project
team. Often the project team members are co-located and can concurrently
complete their functional tasks.
The second of these models is derived from the need of a larger corporation to
outsource a product or service required for the operation of that corporation. The
larger corporation, while needing the service, has made the strategic decision that
providing the service internally is no longer within its core competencies. The
smaller company has been established to provide the service and has formed its
business around the core competence required to deliver that service.
A model not mentioned above is that of the extended enterprise. While not much
literature has been developed regarding this model, it is a model that is viable and
indeed the most agile form of the virtual enterprise. It consists of small and
medium-sized enterprises (SME), where each have developed a limited, yet strong
and unique, set of core competencies. These enterprises can bring their strengths
together using Internet-based communications technologies to collaboratively
engage in a project to develop and produce a complete product. An advantage of
this organizational structure is that each SME can maintain a diverse customer
base, where consultants providing a single service as described above must cater to
a single, or similar set of cIients. While the extended enterprise is arguably the
most agile of the virtual organization models, it comes with some additional risks
which do not exist in the others.
The US marine industry has begun to acknowledge this model as a viable
business process. This paper discusses the structure of this model in a segment of
the US marine industry and presents abrief description of the technology required
for successful implementation. Also, on a level applicable over a broad range of
industries, the differences between concurrent engineering processes and
collaborative product development are defined. Finally, through adescription of a
case study, project risks are evaluated and methodologies for their mitigation
among project partners suggested.
The collaborative engineering process 81
2. THE EMERGENCE OF THE EXTENDED ENTERPRISE MODEL
At the height of the Industrial Revolution in the United States, the scarcest resource
was the capital required to buy facilities, equipment and raw materials. Economies
of scale were the predominate concepts of the time. Concentration on mass
production tended to diminish the role of the individual worker in the process, in
that he served as the control mechanism used to determine if a process could be
automated. Development and engineering processes were not considered to be on
the critical path of the product life cycle. As long as the manufacturing processes
were emcient and large quantities of a product could be sold, the retention of
functional engineering and serial product design processes were considered to be
state-of-the-art.
However, as technology has developed and the infrastructure of nations, as weil
as individual companies, has improved, competition for market share has become
predicated on the improvement of all activities involved in doing business.
Companies are learning that they can no longer depend solelyon equipment and
facilities, but need to improve their knowledge based infrastructure, such as
engineering and product development, as weil.
This represents a significant shift from a monetary based capital perspective to a
knowledge based capital perspective; a perspective from which companies can
clearly see the value in returning to and strengthening their core competencies. It
also represents a shift in basic economics. Rather than the continued development
of regional economies based on allocation of scarce resources, knowledge capital
allows for the development of agiobai economy based on the unlimited
combination of these resources.
The economics of ideas is a thesis pul forth by Paul Romer (Kelly, 1996).
According to Romer, the world should no longer be defined by scarcity and limits
on growth. Instead it should be thought of as a playground of nearly unbounded
opportunity, where new ideas beget new products, new markets and new
possibilities to create wealth. The shift in thinking from traditional economic
theory comes from dividing the world into physical objects and ideas, rather than
wants and physical objects. If physical ideas are scarce, then the only decision left
for traditionalists is how to allocate those scarce resources to maximize wealth. By
coming up with new ideas that reconfigure the interaction between resources,
humans can boost productivity, spawn new profit opportunities and ultimately drive
economic growth.
To draw the business analogy with this concept, as the potential development of
products is based on the combinations of resources, the form of the enterprises
necessary to configure those resources int9 new products and services is based on
the combination of available knowledge and skills. This combination of knowledge
and skills is the foundation of the extended enterprise. In conjunction with the
development of knowledge capital, SMEs are shedding product and service
offerings that do not bolster the core competencies of the business and are
strengthening those that do. As apart of this development, SMEs must make
crucial decisions about what specifically represents a core competency that can be
fully utilized and continuously improved. Other organizational capabilities must be
shed in order to maximize the benefits obtained from the core competencies, while
minimizing the expense and need to improve other activities. As a result of this
trend, SMEs are increasing in number, and the strength of these SMEs is potentially
greater. This increasing pool of narrowly focused, highly skilled small enterprises,
allows for those within that pool to selectively combine forces to achieve two
strategic ends.
First, in partnering with other similar sized organizations, smaller firms can
achieve the strength of large corporations, yet stay focused on the project for which
they are competing and reduce the overhead associated with maintaining
capabilities in a wide range of areas, as is common in large corporations. Second,
these organizations, in working in a collaborative environment, can reduce the time
required to develop and produce products and services. The latter of these is the
focus of the remainder of this paper.
3. CONCURRENT VERSUS COLLABORATIVE ENGINEERING
The fundamental difference between the c1assical definition of concurrent

engineering and what the authors and others are defining as collaborative
engineering is the communication process. Communication is mediated in the
concurrent engineering process. In the collaborative engineering environment,
communication is the process enabler.
Concurrent engineering is an engineering process that came into large favor in the
late 1980' s. It has been a process that has been effective in substantially reducing
product development times. The basic philosophy of concurrent engineering is to
develop the different aspects of product specification in parallel processes instead
of a number of sequential phases (Pels, 1995). In theory this is completely a
parallel process; however, in practice the result is often aseries of sequential
processes running in parallel.
During the concurrent engineering process, cross-functional teams are often
formed. In a matrix organization, these teams are loosely controlled by the project
manager, but the members may still be required to report to their functional
managers. Consequently, the functional processes required for product definition
remain intact. To enable a concurrent process, parallel levels of detail for each
function are defined, and the team members produce only to the required level of
detail before passing on the product to the functional organization. This process
cyc1es until the desired product quality is achieved. In this process, the overall
development time is reduced because the functional groups work in parallel, but
collaboration between team members only occurs during team meetings when
interim products are passed to the next functional organization.
This definition of concurrent engineering has been the norm for an organization
wh ich is geographically dispersed. To overcome the problems associated with this
communication process and place the engineering team in a more collaborative

environment, a common solution has been to co-Iocate team members in a single
room. In this case, communication is readily enabled due to the close proximity of
the project team; this is the model for the collaborative engineering process.
Since each team member has ready access to other team members and the
portions of the product for which they are not responsible, a collaborative problem
solving environment is created. In this environment, product definition is enabled
by communication and discrete iterations between levels of detail are blurred. As a
result, cycle time is reduced from that of the concurrent engineering process
because of the fact that contributions of the team functions can be made when
necessary and the next function in the process does not have to wait for the
completed level package from the previous.
Even recently, the idea of collaborative engineering among geographically
disbursed team members considered to be far-fetched. It was perceived that
communication was only effective in the environment where the team members
were co-Iocated (Pels, 1995). However technological changes have made the
collaborative engineering process possible among several individual enterprises
acting as a virtual organization.
In the United States, as improvements in technology have enable remote
collaborative communication, many industries have easily adapted to the virtual
enterprise organization structure. Currently, the marine industry, which is
traditionally slow to adopt new technology, is beginning to accept the concept of
the virtual enterprise, as weIl. This is evidenced by the surge in projects being
sponsored by government and undertaken by corporate partnerships to deploy
sophisticated communication process technologies into this industry, as weil as
smaller experiments undertaken by small and medium sizes enterprise cooperation.
4. A MODEL OF THE VIRTUAL ENTERPRISE IN THE US MARINE

INDUSTRY
The virtual enterprise is a consortium of several business entities supporting a

common goal. Because each partner brings a strength, or core competence to the
consortium, the success of the project depends on all cooperating as a unit (Caskey,
1995). The US Marine industry is indeed ripe for doing business in such a
collaborative, yet geographically dispersed environment.
The US marine industry is perhaps best known for its six largest shipyards;
however, there is a wide range of enterprises, both in terms of size and industry
segmentation. Recent data have shown t.hat there are nearly 2500 shipbuilding,
boatbuilding and ship repair firms in the United States. In support of these
enterprises, there are naval architect and marine engineering firms, material
suppliers, and regulatory bodies.
Currently, typical vessel design and build strategies are undergone in a sequential
fashion, as shown in Figure I.
Figure 1 The Traditional Vessel OesignlBuild Organizational Structure
The designer creates the vessel design in the form of an electronic drawing
database. Ouring this drawing development process, computer-aided engineering
and drafting (CAE and CAD) software packages are used. Often, because these
packages may be incompatible, technical data cannot be electronically passed from
one to the other. Worse yet, vendors may supply information to the designer which
may be electronically incompatible or paper-based. Finally, via paper copies of the
CAD developed drawings, the vessel design is communicated to the owner. Upon
approval of the design, specifications are written which, along with the drawings,
are se nt to building contractors for bids. This is done without using the electronic
media in which the specifications and drawings were developed. Further, the
bidders may invite input from vendors not used by the owner/operator or the
designer during the initial phase of this design process.
At the time of contract award, the building contractor uses the drawings and
specifications to create working drawings, numerical controlled (NC) machine
code, and work instructions specific to their capabilities. If the electronic data is
compatible and he chooses to use the CAD drawing database, it is at his risk. If the
information is not compatible, or the risk is considered to be unacceptable, then the
Iines are redrawn and the NC code is rewritten.
The above scenario forces inefficiency into the design process and causes
unnecessarily high costs and long product development cycles. By doing business
in this traditional sequence the vessel is designed twice, first by the owner and his
designer agent, then by the builder. This paper suggests a model which allows for
an innovative partnering arrangement through which these sequential steps are done
in a virtual enterprise as a distributed collaboration, as shown in Figure 2.
...
{ )
~
Owner/Operator
"
ReQulatorv Body
t ~
EQuipment and Maten I
~
Suppliers
Virtual Corporation
Project ManaQer
"
.A
,{ t
Naval Arcitect Marin
~ EnQineer
"
~
Shipyard
-+--'
Figure 2 Vlrtual Collaborative Dlstnbuted Enterpnse OrgamzatlOnal Structure
Figure 2 suggests a collaborative environment since each enterprise has access to

the other. Introduced into this model is the project manager. Because ship design
and construction is a complicated activity, the authors believe that the project
manager is necessary in this model for this model of the virtual enterprise to
succeed. The role of the project manger, discussed later in this paper, is to
coordinate activities among the project partners required to reach project
milestones -- not mediate communication. Another strength of this arrangement is
that all project partners, through the use of a wide area network, such as the
Internet, are allowed unlimited electronic access to the product design as it
proceeds. This is done by working with a compatible and integrated suite of
engineering, design, planning and visualization tools used throughout the process.
Although each enterprise has unlimited access to the product database as it is
developed, the project manager must also devise a scheme to ensure all team
members are working with the same data set as the project progresses. To
accomplish this task, the team members need to agree upon a central repository for
the database and ensure that this central database is updated regularly.
Perhaps the most significant advantage to this model is that it is a vehicle for the
owner, designer and shipyard to simultaneously participate in the process and
consequently, the vessel design need only be done once. There is no need to draw
a distinction between concept/contract design and detail design because all parties
can collaborate throughout the design process. However, while the inefficiencies
of the typical design process described earlier in this section can be greatly reduced
or eliminated, care needs to be taken in balancing project risks and responsibilities.
5. CASE STUDY OF SME's OPERATING IN AN EXTENDED ENTERPRISE

ENVIRONMENT
A key reason driving the development of extended enterprises by SMEs is the

economics of obtaining services for completing a specific project, while avoiding
the overhead of maintaining capabilities that can only be employed sporadically.
Commercial boatbuilding offers an example of the development of such
relationships.
In the Pacific Northwest region of the United States, a vibrant small boatbuilding
industry exists. Typically, potential owners contact a boatbuilder concerning the
project. These boatbuilders provide a facility primarily capable of assembling a
boat from parts and components that are manufactured and purchased from outside
the boatbuilders facility, and offering the opportunity to launch and test the
completed boat. The core competencies and facilities offered are therefore
assembly skills, for structure and outfit systems, system integration and testing
skills, and launching and assembly facilities.
Substantial additional competencies are required to successfully complete the
project. Among these are engineering capabilities and parts manufacturing
capabilities. It is common to purchase existing equipment from outside
manufacturers, including larger components such as main propulsion engines,
gears, and generators, and smaller components, such as pumps, valves, windows,
and light fixtures. These products are rarely redesigned for a specific new
boatbuilding project. On the other hand, it is common to design the hull of a boat
for a specific project. This impacts the capability of the boat to satisfy the owners
needs, including requirements of speed, handling, cargo carrying capacity, and so
forth. Thus, an important part of the success of the project is the hull design and
construction.
At least two additional SMEs are typically employed for this later requirement.
These are design agents and structural parts producers. In a typical boatbuilding
project, the production of structure involves the following steps:
1. Contract design
2. Detail design
3. Lofting
4. Structural material processing
5. Structural material assembly.
Step one is performed by a designer or design firm working directly for the
owner, sometimes in consultation with the boatbuilder. Steps two and three are
performed by another design firm, typically under contract to the boatbuilder. In a
small boatyard, two to five vessels per year are built. The overhead cost associated
with maintaining detail design and lofting capability cannot be justified. Step four
is commonly performed by an independent structural material processing service
center. These SMEs have NC cutting capability, often using computer generated
information transferred directly from a design agent. The cut structural parts are
then delivered directly to the boatyard. Here again, the overhead of maintaining
NC cutting capability in a small boatyard cannot be justified by the volume of work
anticipated (Lane, 1996).
6. BALANCING RISKIRESPONSIBILITY/REWARD IN THE DESIGN OF

THE VIRTUAL ENTERPRISE
This simple example of an extended enterprise, while extremely successful, is not

without it's difficulties. Of primary concern is the handling of problems that may
occur as apart of this arrangement.
The three primary partners, the design agent, the structural material processing
service center, and the boatyard are relatively small businesses, each with Iimited
resources. There is no obvious primary contractor, with smaller sub-contractors, as
is the case with many extended enterprise arrangements. Thus there is no obvious
primary responsibility for this part of the project.
The typical problems that have been encountered are in the following areas:
I. Information generation, by the design agent
2. Information exchange, between the design agent and the processing service
center
3. Parts production, by the processing service center
4. Parts assembly, by the boatyard.
Contract design incIudes a Iines plan, which defines the hull form. This
information is used for critical design development, and is essential for
performance prediction. However, contract lines plans are not in sufficient detail to
be direct1y useable for lofting. Thus an additional detail definition, incIuding the
critical lines fairing activity, must be performed by the design agent in preparation
for transferring data to the material processing service center. Additionally, the
design agent must include internal structure, which is also not defined in detail by
contract drawings. The design agent must consider the boatyard assembly
practices, incIuding welding techniques, assembly sequences, and weId distortion
and shrinkage, in order to properly develop the information required by the
material processing service center. FinalIy, consideration of the integration of the
outfit systems with the structure must also take place at this time (Pollard, 1996).
Information transfer problems can occur due to difficulties in transmission
facilities (busy or dirty telephone lines, etc.) and due to different software
employed by the design agent and the material processing service center.
The material processing service center must control the accuracy of parts
produced and the marking and packaging of the parts when shipped to the boatyard.
Issues incIude efficient use of raw material, accuracy and cIarity of marking, and
control of shipments.
The final step is the use of the parts by the boatyard. Included here is the
accuracy of the assembly process, contro\, handling, and storage of material before
and during use, and the general planning process employed by the boatyard.
In this environment, problem resolution becomes extremely important; however,
since there is no single party responsible tor managing these activities, it becomes
very inefficient. All parties must become involved in assessing the cause of
problems, identifymg solutions, and recovering from their economic impact.
Typically, problems generate costs in two areas, wasted material and schedule
degradation. Naturally, additional time is required by some or all of the members
of the extended enterprise, which also adds to the cost of the project. To date,
problems have been solved by mutual agreement and by sharing of costs.
The requirement to share costs among the partners is counter productive to the
goals of each enterprise. To implement an effective virtual enterprise that is not
only geographically disbursed, but is set in a collaborative environment as weil,
several solutions are available. Technology, when appropriately applied, can aid
the extended enterprises. In particular, statistical quality control offers the
opportunity to minimize production problems at both the material processing
service center and the boatyard; the use of 3D computer modeling and product
model databases will help the planning and interchange of information between all
three partners; and communications technologies can continue to be implemented
as they improve. In addition to the application of technology, the inc\usion of the
project management function in the enterprise will ensure that its goals can be
achieved.
7. THE ROLE OF THE PROJECT MANAGER
As described by the case study, the current state of the extended enterprise among
SME's in the US marine industry is missing a means for a single organization to
perform basic project management functions. As evidenced by inefficient problem
solving in times of contlict, the function of project management is passed along
from enterpnse to enterprise in an ad hoc fashion. Often, after discovery of a
problem, the enterprise bearing the highest degree of risk will assurne the lead in
reaching resolution to the contlict at hand. Although SME's have joined together
tor completion of a project. this environment inhibits the continuous alignment of
the individual goals of the project partners.
The model of the virtual enterprise presented in Figure 2 provides that missing
element. As described above, the SME's that make up the elements of the virtual
enterprise have a strong, narrowly focused set of core competencies. The project
manager provides a means for these SME's to concentrate on their tasks, while
integrating those tasks and fostering effective communication between the
individual enterprises. In asense, the function of the Project Manager is analogous
to a neutral file used to transfer data among different applications and platforms.
The Project Management Institute (PMI) suggests nine skill areas in which the
project manager must be proficient in order to successfully manage a project (PMI,
1996). These are:
1. Integration Management.
2. Scope Management.
3. Time Management.
4. Cost Management.
5. Quality Management.
6. Human Resource Management.
7. Communications Management.
8. Risk Management.
9. Procurement (Contracts) Management.
The project manager must possess a wide body of knowledge; however, in

possessing this knowledge, his core competence is that of project management. In
addition to possessing a broad range of management skills, the project manager
must also maintain a domain specific expertise, as suggested by integration
management at the top of this list. For example, in the marine industry, he must
have a general knowledge of vessel requirements and performance specifications,
equipment and components of wh ich the vessel is comprised and vendors and
suppliers that can provide the required products and services.
8. CONCLUSIONS
Great strides have been made toward collaborative engineering in a distributed,

collaborative environment. Initially, the concept of concurrent engineering
allowed corporations to make significant productivity gains through a methodology
that allowed for functional tasks to be accomplished in parallel. While product
development cycle time was substantially reduced, a truly collaborative engineering
environment did not exist unless team members were co-Iocated.
Advances in communications technology has enabled the formation of the
extended enterprise, allowing SME's to stay focused on their core competencies,
while banding together to complete projects that none would be able to accomplish
individually. In theory, the extended enterprise has empowered SME's to create
collaborative environments while remaining geographically dispersed. However, in
practice SME's engaged in a virtual extended enterprise can lose sight of the
project goals and become entangled in resolving conflicts among themselves. This
is evidenced by the case study presented in this paper. While the three project
partners accomplished the set of five tasks, there was no single entity to take
responsibility for mediating communication and resolving the conflicts between
them.
To continue the evolution of the virtual extended enterprise and ensure that it can
indeed create a collaborative environment among its partners, the authors have
presented a model for the US marine industry in Figure 2. In this model the project
manager figures prominently. The project manager is the logical choice to take
responsibility for the successful management of the project. As theeftlterprise
partners have strength in their areas of expertise, so must the project manager. He
must be competent in all areas of project management, and possess a broad
knowledge of the domain in which he is functioning.
9. REFERENCES
Caskey, K. R. (1995), Co-operative Distributed Simulation and Optimisation in

Extended Enterprises, Presented at IFIP Conference. Seattle, W A, USA.
Kelly. K. (Jun. 1996), 'The Economics ofIdeas', Wired.
Lane. K. Interview with R. L. Storch, June, 1996.
Pels, ir. HJ. (1995), Control of CE-Process by Document Quality Levels,
Presented at IFIP Conference. Seattle. WA, USA.
Pollard, S., Barry, c., et.a!. (Jan. 1996), 'Loftsman's Liability'. Professional Boat
Builder.
Project Management Standards Committee, PMI, (1996), A Guide to the Project
Management Body oi Knowledge, Project Management Institute, Upper Darby,
PA.
10. BIOORAPHY
Matt Williamson is the owner of Project Solutions, a project management

consulting firm in Seattle, Washington. He holds a BSME from the University of
Utah and a MBA in Engineering and Technology Management from City
University. He has worked in the marine industry for thirteen years. most recently
developing business processes for the Extended Enterprise. He is a member of
PMI, ASME, SNAME. IFIP WO 5.7 and the NSRP.
Richard Lee Storch is an Associate Professor of Industrial Engineering at the

University ofWashington. He holds a Ph.D. from the University ofWashington. a
Master's from M.I.T., and a Bachelor's from Webb Institute of Naval Architecture.
His research has concentrated on productivity and quality improvement in ship
production and large assembly manufacturing systems. He is a member of the Ship
Production Committee, SNAME, IFIP WO 5.7. HE, ASNE, and SME. and is the
lead author of the text Ship Production.
9
Collaborative autonomous control
F. Biennier 1, J Favrel 1, J.P. Denat 2
1 - PRISMa, INSA de Lyon - IF 502, 69621 Villeubanne Cidex

France, phone : 33 4 72 43 84 85, fax: 33 4 72 43 85 18,
email: biennier@ijhpserv. insa-lyon.Jr
2 - LAMIl / CESALP, ESIA - BP 806, 74016 ANNECY Cedex,
France, phone: 334506660 43,fax: 33450666020,
email: denat@esia. univ-savoiejr
Abstract
Taking efficiently robustness into ac count in a production system involves to take
perturbations as « normal events» in the control architecture. In order to reduce
reaction times, the global robustness of a production system can be improved by
implementing a distributed control architecture. For this purpose, we propose to
design a distributed autonomous control architecture, based on behaviour based
principles. Then, collaboration between elementary controllers is described with
particular languages taken from real time and telecommunication fields.
Keywords
Robustness, behaviour based control, formal specifications
INTRODUCTION
Controlling a production system involves to co-ordinate several elementary
specialised controllers as workshop control, material requirements systems
(Biennier et al., 1993) ... The descriptions ofsuch a complex system can be directed

by resources as in Craye and Gentiana (1989), tasks as in Bonetto (1987) or by

cognitive point of view as in Caillau et al. (1989) or in Rasmussen and Lind
(1982). Such a decentralised organisation can improve reaction abilities and
consequently the global robustness of the production system. Nevertheless,
collaboration between controllers must be taken into account to insure agiobai
consistency and reduced answering times.
So we will first describe the robustness concepts and requirements before
setting the basic autonomous control features and describing how these elementary
controllers can collaborate. An example based on the AIPRAO flexible workshop
will be presented in order to illustrate the proposed approach.
2 ROBUST CONTROL OF A MANUF ACTURING SYSTEM

Manufacturing systems are managed by different controllers, each ofthem devoted
to a particular task or resource and even divided according to different temporal
horizons. Introducing robustness in manufacturing control systems aims to make
them more resistant to perturbations and to improve their reaction abilities.
Roughly, robustness of a production control system can be defined as its ability
to « absorb» perturbations. Perturbations can be defined as 'non predictable
events'. This involves two main classes ofperturbations:
- some perturbations can be identified BUT one never knows when they can
happen. For example, processing activities consume tools. This can be
computed and weil identified. Nevertheless, it is not possible to compute the
exact moment when the tool will be broken,
- some perturbations are not known apriori: they are due to main changes in
the production context.
These perturbations can be integrated at different levels in the 'production
decision system' :
- identified perturbations can be taken into account as normal events in the
production decision system. For this purpose, these perturbations must be
weil described:
* how they can be identified,
* what are their consequences,
* how they can be planned,
* how they can be processed,
then, they can be integrated in the planning process as a goal or they can also
be integrated in the decision process when it is described as a finite state
automaton.
- unidentified perturbations can be processed only when they occur;
consequently, they are only concemed by « reactions}) of the decision
system. After they occur, they can be identified and added to the identified
perturbations if they do not involve an important cost in the decision
function.
Consequently, two kinds ofrobustness can be defined (figure 1) :
Collaborative autonomous control 93
- On one hand, control sequences can be intrinsically robust, i.e. they are able
to absorb different kinds of perturbations without affecting the global
performance. This is what we call the intrinsic robustness. Of course, this
kind of robustness mainly deals with predictable perturbations.
- On the other hand, control sequences have to be modified to absorb some
perturbations to maintain the global performance. This is what we call
dynamic robustness. This kind of robustness deals with both predictable and
non identified perturbations.
~cro~
Figure 1 : Static Vs Dynamic robustness.
Intrinsic robustness involves to take perturbations as "normal" events in the

planning process. So, the point consists in making an heavy use of margins and in
choosing the more robust heuristic, i.e. the one that fits the best to the production
context (perturbations can be ineluded as weIl in the context). For this purpose,
neural networks can be used (as in Guillard et al. (1991) or Rabello et al. (1993))
to elassify different scheduling strategies or heuristics according to the production
context. Moreover, if the scheduling process exhibits convenient performances,
such a system can adapt continuously the scheduling strategy to the context. In this
case, dynamic robustness is improved as weil.
Dynamic robustness is quite elose to reactive abilities. When aperturbation
occurs, the production system must adapt its control sequence to preserve the
global performance. According to this point of view, the control architecture
should be as elose as possible to the system. For this purpose, sm all autonomous
controllers seems to be a convenient solution.
Communication between intrinsic robustness and dynamic robustness can be
provided by a ' robustness supervisor' (Biennier et al., 1995). Depending on the
incoming event, the supervisor evaluates if areaction is needed and which decision
system has to react. Then these experiences are capitalised in order to improve
intrinsic robustness (figure 2).
Reaction
Midterm
Reaction control
result Control
Perturbation System
Internal perturbation
Control sequence
~~----------~~
Production system
Figure 2: Principle ofthe robustness supervisor.
By this way, global robustness is improved and 'on line' adaptation can be used
to integrate 'unidentified perturbations' into account.
3 AUTONOMOUSCONTROL
Increasing dynamic robustness can be achieved by increasing reaction abilities.
Decentralised organisation involves also autonomous controllers. For this purpose,
we propose to build a self-organised system based on reactive controllers.
In 1986, R.A. Brooks proposed a new control approach called 'Behaviour based
control' or 'Reactive control' (Brooks, 1986). The basic principle of this
architecture is very simple: intelligent control is not directly related to the
complexity of adecision centre. Since systems are qualified as 'intelligent
systems' according to the behaviours they exhibit, Brooks proposed to base robots'
decisions on their desired behaviour and coupled directly perception to action
without using any representation ofthe external world.
Such an approach improves self organisation and controllers exhibit robust
behaviours. That is why we use this architecture to implement basic controllers for
autonomous conveying robots. By this way, the decision process consists only in
reactions to the environment and there is no description of the workshop.
Consequently, dynamic robustness is improved. Simulations have shown that the
self-organisation of this conveying system gives good results (Beslon et al., 1995)
and is pertinent to implement robust control.
Nevertheless, such approaches rely totallyon the graph of behaviours. When the
number of modules increases, this network becomes quickly hard to build. A
methodology and a conception language may help the designers to build evolved
controllers but leaming algorithms appear as a possible solution to build
automatically complex behaviour based controllers (Maes and Brooks, 1990).
Nevertheless, none ofthese approaches takes collaborative features into account.
4 COLLABORATIVE CONTROL
Collaborative control of a production system involves first to define the global
decision system and the way it is distributed among elementary controllers. For
this purpose, two main strategies can be used (figure 3):
- the decision architecture is a 'task driven architecture': in this case, a
controller is defined for each task and may control different resources (a)
- the decision architecture is a 'resource driven architecture' : in this case, a
controller is attached to each resource and may be used by different tasks (b).
Controller 'I '

Production management orders
1
. . Conveyor
L -_ _---'
(a) a task driven architecture (b) a resource driven architecture

Figure 3: Descriptions of a same decision process.
Co-operation between controllers can be achieved in different ways:

- directly, ifthe output ofa controller is used as an incoming event by others; in
this case, reaction times are related to the number of connected controllers
between an event to the final answer,
- indirectly, if controllers communicate only thanks to the environment they
share; in this case, the main problem relies on the inertia of the environment:
controllers can react only when they can detect a significant event,
- at the 'knowledge level', if controllers can share a common information and
knowledge system; by this way they can anticipate changes in their common
environment.
The collaborative architecture we propose is a layered architecture (figure 4):
- Elementary controllers are gathered into an hypergraph structure in order to
provide a communication at the knowledge level, so each elementary
controller can have a global point of view on the system (Biennier et al.,
1993). This feature is achieved by using epigenetic cognitive hypermaps, an
extension ofKosko's cognitive maps (Kosko, 1986).
- Indirect collaboration is improved with a 'news group' mechanism. Each
controller is related to a list of incoming events and in a symmetrical way,
each identified event is related to a list of controllers. By this way, a
controller can anticipate its reaction and processes the event BEFORE being
informed of its effects on the environment. Of course, unidentified events are

processed traditionally according to the action they have on the environment.
Nevertheless, in order to improve intrinsic and dynamic robustness, they can
be inserted in the incoming events list just after their first processing,
- Direct collaboration is related to a graph of elementary controllers.
Consequently, each controller can export some events or parts of its context
to other controllers. This mechanism is similar to the import / export
mechanism defined in ESTELLE (lSO/TC97/SC211WGl6-1, 1988) or SDL
(CCITT, 1985). A broadcast mechanism is also available in order to provide
the same information to all the controllers belonging to a communication
network.
CTRLl CTRL2
Decision
knowledge
management
Contral
Graph
Event collector Event distributor
IMailing manager
Figure 4: General organisation ofthe global architecture.
The global decision process can be described with complementary tools taken
from real times systems as SADT methods introduced by (Ross 1977) or the LA4
system described by (Schwarz et al. 1994) and from the telecommunication fields
as SDL (CCITT, 1985). By this way different abstraction levels and precise formal
descriptions can be achieved in a similar way as concurrent engineering activities
are described (Biennier et al. 1994).
As the communication network architecture is related to the information flows
and to the time constraints, the communication graph used for the direct
collaboration can be partly deduced from the network architecture. In a similar
way, high level network addressing features can be used to identify the different
decision systems and their hierarchy.
This communication architecture can also be taken into account in order to

adapt the information flows to the communication features. For this purpose,
different levels can be defined and decision functions can be physically distributed
among different elementary decision and processing units (figure 5):
- level 0 consists in field bus: it should be a low cost network, with short
answering times; it connects sensors and actuators; This instrumentation level
uses particular communication protocols as IEEE488 (Standard IEC 625).
Fieldbus (standard EN50170) as WFip (norm UTE C40-60 1/46-607),
Profibus or Pnet offer a good solution for this level. It allows to guarantee the
coherence of the information in a multipoints network. WFip uses MMS
(ISO standard IS 9506/1 and 9506/2) at OSI Application level.
- level 1 consists in connecting machines, responsible for a set of operations;
orders are given by level 2 and this level co-ordinates and processes
information and tasks achieved in level 0; communication at this level uses
particular software specifications with critical answering time; this is done
for example in the MiniMAP standard (standard ISO 8802.4); Ethernet
(standard ISO 8802.3) or TokenRing (standard ISO 8802.5) can also be used.
- level 2 manages the workshop and has to co-ordinate a set of machines; it has
to download processes on the convenient machines, control and synchronise
different tasks ... For this purpose tools as MMS (ISO standard IS 950611 and
9506/2), can be used efficiently;
- level 3 is the main network: answering times are no more critical at this
levels; it connects the different CAX systems and the communication
requirements consists mainly in file transfer and control or in message
interchange; consequently, traditional tools as files transfer (FTAM, FTP),
shared files (NFS, Windows NT, Netware), or E-mail (X400, SMTP).
"';::;::;:::;:;:;:;:::j'I
~~~"" ~.....,....,..,..a.,~~ Level 0 Automations
Figure 5: Organisation of different network features.
Moreover, this 'adjusted' distribution favours a modular definition of the

decision process, and a convenient choice ofthe communication software.
5 EXAMPLE
Depending on the control organisation (a task driven approach or a resource driven
approach), different architectures can be buHt for a same system. In the following
example, we present briefly these two strategies applied to a part manufacturing in
the AIPRAO flexible workshop presented figure 6.
ROCAD
(University
ne!work)
Figure 6: Synoptic ofthe AIPRAO physical system.
Manufacturing a part involves to co-ordinate both the conveying system, robots

and machines. The global architecture for the two main strategies will be described
(f}
with the LA4 and SDL graphicallanguages (figure 7).
Task
~ State
Infinite loop
~ Incoming event
Sequentiai
process
c::::::> Output event
o Test
8 Mailbox c=J Process
tzJ Semaphor
<.•-=.-.=> Ressource
(a) LA4 graphicallanguage (b) SDL graphicallanguage
Figure 7 : Graphicallanguages used
5.1 Task driven description

Such an organisation is rather linked to a 'planned organisation' after choosing a
particular process, different systems are collaborating to achieve a particular
process.
In a task driven organisation, each task can be seen as a particular behaviour.
Consequently, a general graph of behaviour is linked to the global workshop in
order to select the convenient control processes depending on the context (8a).
Then , each elementary behaviour consists in:
- an evaluation process which computes the interest level of selecting this
behaviour according to the context,
- a description ofthe control system associated to this particular behaviour.
For this purpose, the different controllers MUST be synchronised. This can be
formalised with a general synoptic using the LA4 language (8b). Then, different
controllers are Iinked to the tasks and described in SDL automata (8c, 8d).
(8a) : Behaviour based (8b) LA4 description of the process 'part

control of a task driven manufacturing'.
workshop.
(8c) SDL automaton of the (8d) SDL automaton of a machine

conveying controller Controller
Figure 8 : Task driven contro!.
5.2 Resource driven approach

In this case, reaction abilities are developed for each controller and such an
architecture is quite elose to a self-organised control system. In his case, there are
no general control structure: each controller is designed to take into account
different events. Consequently a graph of behaviour is attached to each controller
(figure 9a) shows the elementary graph associated to a line controller). Then,
contextual behaviours can be described in SDL automaton (figure 9b) shows the
automaton associated to a particular machine).
Convenient
behaviour
(a) Elementary graph ofbehaviour (b) SDL automaton associated to a

machine
Figure 9 : Resource driven description
6 CONCLUSION
The architecture proposed in this paper is based on reaction abilities and aims to
increase robustness. For this purpose, a reactive controller is proposed, based on
the behaviour based control principles. By this way, self-organisation is improved.
Nevertheless, such elementary controllers must collaborate in order to provide an
efficient contro!. For this purpose, we propose a three levels architecture (figure 4),
ma,inly based on communication features.
Simulations have shown the interest of such a reactive contro!. Nevertheless,
few experiments are needed in order to implement directly these features with
existing communication software, as MMS for example, in order to improve the
response tim es.
Collaborative autonomous contro! 101
7 REFERENCES
Beslon G., F. Biennier and 1. Favrel (1995). A flexible conveying system based on
autonomous robots. CARs and FOF'95 proceedings, Pereira (Colombie),
August 1995, vol. 1, pp. 115-120
Biennier F., 1. Favrel and G. Beslon (1993). Integration of information and
knowledge from the engineering activity to the workshop control. IEEE
International Conference on Robotics and Automation proceedings, pp 840-
845, New York, IEEE Press
Biennier F., P. Coquard and 1. Favrel (1994). Modelling collaborative work in
concurrent engineering. Proceedings of the IFIP International Conference on
Feature Modelling and Recognition in advanced CAO/CAM Systems, Paris:
Hermes, pp. 125-139
Biennier F., G. Beslon and 1. Favrel (1995). Robust Control For Manufacturing
Systems. IMS'95 Proceedings, Bucharest (Romania), November 1995, pp.
349-354
Bonetto R. (1987). Les ateliers flexibles de production. Hermes, Paris
Brooks R.A. (1986). A robust layered control system for a mobile robot. IEEE
journal ofrobotics and automation, vol. RA-2 (1), pp. 14-23
Caillau A., F. Meftouh, F. Oonnarel and P. Lopez (1989). Oriving assembly unit
by means of expert system. AIPAC'89 Proceedings, vol. 2, pp. 224-228
CCITT, 1985. Red Book, vol. VI.lO, "Language for Oescription and Functionnal
Specification (SOL)", Advices n° Z.100 to Z.104, 1985
Craye E. and 1.C. Gentiana (1989). Oistributed implementation and hierarchical
level for control of flexible manufacturing systems. AIPAC'89 Proceedings,
vol. 2, pp. 190-193
Guillard S., P. Baptiste and 1. Favrel (1991). Modelling and simulation for self
organization in modem production workshop. CAPE'91 proceedings, pp. 705-
712
ISO/TC97 /SC21/WG 16-1 (1988). Estelle: a formal description technique based on
an extended state transition. OP9074
Kosko B. (1986). Fuzzy cognitive maps. International journal of man-machine
studies, n024, pp. 65-75
Maes P. and R.A. Brooks (1990). Learning to coordinate behaviors. AAAI
proceedings, pp. 796-802
Rabello L., Y. Yih, A. Iones and 1.S. Tsai (1993). Intelligent scheduling for
flexible manufacturing systems. IEEE International conference on robotics and
automation proceedings, vol. 3, pp. 810-815, New York, IEEE Press
Rasmussen 1. and M. Lind (1982). A model of human decision making in complex
systems and its use for design system control strategies. American control
conference, pp. 270-276
Ross O.T. (1977). Structured analysis: a language for communicating ideas. IEEE
Transactions on software engineering, vol. 3, nOl
8 ACKNOWLEDGEMENT
This work is a part of the CORINE project supported by the Region Rhone
Alpes (FRANCE) and the MESR.
9 BIOGRAPHY
Frederique Biennier is an assistant professor at the INSA de Lyon. She received

her engineering degree in computer science in 1988 and the Ph. D. in computer
science and automatics in 1990. Her main teaching activities concern neural
networks theory and practice, hardware features, real time systems,
telecommunication systems and services and production management. Her main
research topics are production control (scheduling activities, workshop control)
and designing support systems for concurrent engineering (information systems,
collaborative work management) thanks to common tools as neural networks or
formal specifications.
Joel Favrel is a professor at the INSA de Lyon. He received his engineering degree
in electronics at the INSA de Lyon in 1964 and his doctorate of Science at the
University Claude Bernard - Lyon Science in 1968. His main teaching activities
concern probability and statistics and Computer Integrated Manufacturing. His
main research areas are related to CIM and specially scheduling, group technology
and information systems for production. He is currently in charge of the
production engineering research group at the LISPI laboratory, and of an
experimental CIM centre (AlP RAO). He is also a French representative at IFIP in
the working group 5.7 (Computer Aided Planning).
leaD Paul Denat is an assistant professor at the ESIA, Universite de Savoie. He

received his Ph D in applied physics in 1976. Since 1985 his research and teaching
activities have moved to discrete events systems (finite state machines, Grafcet,
Petri nets ... ). His research areas are related to robust control of discrete systems
with staying time constraints.
10
An agent hased control system for a
model factory
A.J.R. Zwegers, H.J. Pels, R.L.J. Schrijver, R.J. van den Berg
Department ofTechnology Management
Eindhoven University ofTechnology, Pav. C10
P.O. Box 513,5600 MB Eindhoven, the Netherlands
Tel: +31-40-2472671 Fax: +31-40-2436492
Email: A.J.R.Zwegers@tm.tue.nl
Abstract
The objective of this paper is to present the design of an agent based system for a
specific model factory. A manufacturing system can be seen as a collection of
autonomous, problem solving agents which interact when they have
interdependencies. A concurrent programming formalism is used for the
specification of the agent based system. Agents have the possibility to subcontract
jobs. Compared to a previously specified heterarchical control architecture, the
agent based system is more robust and flexible. The suitability of an agent based
approach is dependent on characteristics of the production system, such as
uncertainty in product specifications.
Keywords
Agent Based Systems, Control Architecture, Heterarchical Control, Shop Floor
Contro!.
1 INTRODUCTION
Current production management architectures show significant deficiencies in

controlling the complexity and the uncertainty that is typical of manufacturing
systems. In manufacturing systems, the predominant architectural paradigm has up
to now been hierarchica!. Because of its mechanistic and deterministic approach,
the hierarchical paradigm has numerous defects in coping with uncertainty and

with the rapidly evolving scenario that characterises today's manufacturing

environments. In this paper, we concentrate on another approach that is derived
from Distributed Artificial Intelligence, and that is based on the concept of
distributed, autonomous agents.
The objective of this paper is to present the design of an agent based system, and
to compare the characteristics of the agent based architecture with those of a
previously specified control architecture. In addition, we mention some
considerations in designing an agent based system. We apply the concepts of the
agent based approach in a model factory of a printed circuit board assembly and
test line. The architecture is specified by means of a concurrent programming
technique, which is suitable for the specification of distributed control
architectures. The agent based design is subsequently compared to another
heterarchical control system, which has previously been designed and
implemented in the model factory.
The paper is organised as follows. In the next section, the agent based concept is
explained in more detail. After this, we shortly describe the specification language
we have applied. Then, the actual design of an agent based control system is given,
together with some considerations that have to be treated during the design
process. Finally, we discuss the agent based control system compared to the
heterarchical system, and we touch upon the situations in which an agent based
control system proves most suitable.
2 AGENT BASED SYSTEMS
Strong similarities can be found between the characteristics of agents and those of
current manufacturing systems. Manufacturing processes are highly dynamic and
unpredictable; it is difficult to completely separate the planning and sequencing of
required activities from their execution. Any detailed time plans are often
disrupted by unpredictable delays and other unanticipated events. As a result, a
tendency exists within manufacturing systems to decentralise the ownership of the
tasks, information, and resources involved in the various processes. Different
groups within manufacturing systems become relatively autonomous: how their
resources are consumed, by whom, at what cost, and in which time frame lies
within their own prerogative.
Given these characteristics, it is quite natural to model the processes in a
manufacturing system as a set of autonomous, problem solving agents which
interact when they have interdependencies. In such a context, an agent can be seen
as an encapsulated problem solving entity that exhibits the following properties:
• Autonomy: agents perform the majority of their problem solving tasks without
the direct intervention of other agents; they control their own actions and their
own internal state.
• Social ability: agents interact, when they deern appropriate, with other agents
in order to complete their problem solving and to help others with their tasks.
An agent based control systemfor a modelfactory 105
This implies that agents have, as aminImUm, a means by which they can
communicate their requirements to others and an internal mechanism to decide
what and when social interactions are appropriate (both in terms of generating
requests and judging incoming requests).
• Proactiveness: agents take the initiative where appropriate.
• Responsiveness: agents perceive their environment and respond in a timely
fashion to changes that occur in it (Jennings, et al., 1996).
Each agent is able to perform one or more services or tasks. If an agent requires a
service that is managed by another agent, it cannot simply instruct the other agent
to start the service; agents are autonomous, and control dependencies between
them do not exist. Instead, the agents must come to a mutually acceptable
agreement about the terms and conditions under which the desired service will be
performed. The mechanism for making these agreements is negotiation, a joint
decision making process in which the parties verbalise their demands and then
move towards agreement by a process of concession.
To negotiate with one another, agents need a protocol that specifies the role of
the current message interchange, e.g. whether the agent is making a proposal or
responding with a counterproposal, or whether it is accepting or rejecting a
proposal. A well-known example of such a protocol is the Contract Net (Smith,
1980). According to this protocol, agents decide upon their actions by exchanging
demand and offer for services among themselves, together with status information.
3 SPECIFICATION LANGUAGE X
At Eindhoven University of Technology, department of Mechanical Engineering, a

real-time concurrent programming formalism has been developed, called X. This
formalism can be used for the specification and simulation of discrete industrial
systems. It supports modularity and allows separate descriptions of the structure
and of the components' behaviour. A specific feature of X is the clear
representation and unambiguous specification of interfaces between components
(Mortel Fronczak, et al., 1995).
A system is treated as a collection of concurrently operating sequential
components. A system component is modelIed by a process as a sequential
program where changes in the state of a process are accomplished by performing
actions. Interaction between components is modelIed by send and receive actions
along fixed communication channels. A process is specified by a pro gram in a
CSP-like specification language preceded by Pascal-like declarations of local
variables and statistical distributions. Processes do not share variables - they
interact exclusively by using the communication and synchronisation primitives
(synchronous message-passing). The reader may find an extensive example of the
specification language X in (Mortel Fronczak, et al., 1995; Chi, 1996).
4 MODEL FACTORY
The model factory is a miniaturised, though still complex, model of areal Printed
Circuit Board (PCB) assembly and test plant. The function of the model factory is
to assemble and test pseudo PCBs. Each PCB consists of a board and a maximum
of six components. Currently, two different types of boards and three types of
components are used.
The model factory emulates operations which are performed on real PCBs during
the manufacturing process. The operations of the model factory have been derived
from case studies of real PCB manufacturing facilities. These operations are:
• screen printing: the bare PCB is positioned in the workstation, a PCB-specific
screen is selected and moved into position, and a squeegee is reciprocated
horizontally over the screen.
• component placement: the PCB is positioned in the workstation, and
components are placed on the positions according to the component-
placement recipes for that product.
• rejlow and cleaning: PCBs are passed through an oven and cleaning station
• test and repair: the PCB is inspected to see if it contains the components in the
designated position, and component and functional tests are performed. If the
PCB fails, it must be routed to an off-line diagnosis and repair workstation.
Upon successful repair, the PCB is routed back to the test station.
In addition to the operations described above, the model factory contains some
other features. Raw material and components are automatically supplied from a
centralised raw material store and component store respectively. The model factory
can support mixed model flow production, where different types of products can
be manufactured at the same time. The model factory is designed for batch
production, but the batch size can vary from batch to batch, as weIl as product to
product. The maximum batch size in the model factory is three.
The process layout is depicted in Figure 1. The operations are indicated by
square boxes, whereas stock points are indicated by triangles. The first stock point
contains the two different empty board types. All products pass the screen printer,
but alternative routings are possible between the two component placement
stations. After the reflow and cleaning station, the batches may be stored in the in-
----+ tlow ot products

.... ... . ...... ). ftow of components
Figure 1 Primary process of the model factory

An agent based control system for a model factory 107
process-store which consists of three locations for three products each. Here, a
batch can be split or concatenated with other batches. Then, products are tested and
- if necessary - repaired. In the test and repair cycle, a maximum of one batch can
reside in the buffer. Finally, nine individual products can be stored in the final-
product-store.
An additional feature is a loop from the in-process-store to the screen printer.
This loop is necessary to manufacture PCBs that have components on both sides.
These products have to pass the process twice, since only one side can be finished
in one pass. The buffer in this second-side loop may contain only one batch
(Timmermans, 1993a; Timmermans, 1993b).
5 SPECIFICATION OF AN AGENT BASED CONTROL SYSTEM
5.1 Introduction
During system design, decisions have to be made about the main properties of the
control architecture. Using Cantamessa's work (1995) on the main features that
characterise agent-based approaches, the following statements are made about the
control architecture. The system being modelled is the model factory with a focus
on the left part, i.e. between the screen printer and the reflow and cleaning station.
The objects in the system are batches, workstations, and transportation devices.
The objects in the system that act as agents are the workstations. The batches are
passive entities flowing through the system, and the transportation devices act
upon the orders of the workstations.
Furthermore, the agents' behaviour is derived from the Contract Net scheme with
the possibility to subcontract jobs (see section 5.3). The system structure is
heterarchical, i.e. all agents work on a level of complete parity, without any
superior, coordinating entity. The information flow is directed via a network (see
section 5.5). Agents do not have any knowledge of other agents' capabilities.
Agents requesting a particular service pass their request via the network to all other
agents connected to the network.
5.2 Push Strategy
Batches can be pushed through or pulled out of the factory. With a pu li-approach,
a planning is made in advance. The last station in the line, i.c. the final product
store, is requested to deli ver a batch of finished products at a certain due date.
Then, the last station requests the appropriate batch from its preceding station,
which - at its turn - asks for semi-finished batches to its predecessors, and so on.
When a complete planning is made, the order is released and production starts. For
an example of such a strategy, see (Wiendahl and Ahrens, 1995).
We have chosen for an opportunistic push-approach. With a push-strategy, the
job is brought into the system at the first point of the line, namely the raw material
store. Subsequently, the job finds its way through the system. However, in the
model factory a convergent material flow is present at the component placement
stations; both the boards and the components lead to these assembly stations. In
general, since operation is not planned ahead, stock points should be created in
order to decouple the main stream from the branches. These buffers can be
replenished by means of a pulI approach and simple inventory control heuristics.
Just in front of the model factory's component placement stations, smalI buffers
are located in which two component trays, each containing four components, are
stored. If the first tray in a buffer is out of components, a new tray is ordered from
the central component store. Upon arrival of the new tray with components at the
buffer, the empty tray is removed from it.
The main advantage of an opportunistic dispatch method is that decisions
concerning the distribution of work around the shop are based on the prevailing
system status rather than on some projection of that status (as would be the case
with a pulI approach). Disadvantages include the fact that opportunistic schedulers
are myopic, may ignore interactions with other components, and may only handle
priorities in a rather cumbersome way (Upton, et al. , 1991). Advantages and
disadvantages of both approaches are displayed in Table 1.
Table 1 Advantages and disadvantages of the push and pulI-approaches
Advantages Disadvantages
Push • Robust, capable of dealing • Less suitable for convergent
with disturbances material flows
• Opportunistic behaviour, • Only short-term vision,
routing flexibility possibly myopic
PulI • Suitable for convergent • Excessive planning needed
material flows • More sensitive to disturbances
• Plans in the future
5.3 Protocol
The basic assumption behind this agent-based system is that an agent does not
have any knowledge about other agents. A workstation agent only has knowledge
about the operation(s) the workstation is able to perform. However, this is paid for
by extensive message traffic; for instance, when an agent is ready with a certain
job, it has to send a task announcement to alI agents.
The protocol is based on the Contract Net scheme. In the usual Contract Net
protocol, batches push their way forward looking for resources (see e.g. (Lin and
Solberg, 1992». In our application, these decisions are entrusted to the agent
controlIing the resource from which the batch is to be set free. Workstation agents
announce tasks, submit bids, and offer tasks.
Furthermore, agents have. the possibility to subcontract jobs. At their turn,

subcontractors are not allowed to subcontract. An agent might divide a certain job
among itself and other agents that are capable of fulfilling the same task. If, for
instance, five components have to be placed, the component placement stations
might divide the job in such way that component placer #1 and component
placer #2 place two and three components respectively.
5.4 Agent Structure
An agent consists of six components: arequest handler, a subcontracting

component, a controller, a machine controller, a database, and asender. The
structure of an agent is shown in Figure 2. Note that arrows indicate
communication between components rather than explicit message exchanges.
network
(other agents)
SUbcontracting
Figure 2 Logical diagram of agent components

The request handler issues bids as replies to incoming task announcements,
whether they come from succeeding stations or from identical stations. In the latter
case, the agent serves as a possible subcontractor. The request handler' s task is to
issue a bid. For this, it needs information from the database and possible
subcontractors.
The subcontracting component puts subcontracts out to tender to other agents, in
order to divide the current process step among the agent itself and other agents. If
the agent is already a subcontractor, it will not try to put out to tender again; jobs
are subcontracted once. Incoming bids are evaluated and the best bidder is
rewarded with a task offer - if the overall bid is accepted. The subcontracting
component sends the results of the bidding process to the request handler.
The station controller coordinates the agent's components. It also provides the
interface with the outside world; all messages from/to other agents, such as
negotiations between a predecessor and the request handler, pass through the
controller. Furthermore, it commands the machine controller to start the operation
on a batch. The machine controller performs the actual operation on the batch,
which is evidently dependent on the type of station.
The database stores run-time information of the agent. It sends information to the
request handler, subcontracting component, and controller upon request. For
example, in order to issue a bid, the request handler needs information about
current work in progress, and about the components in the buffer - if appropriate.
The sender is responsible for the continuation of the batch. Before an operation
on the batch is started, the sender sends task announcements to all agents, whether
they are capable of performing the next process step or not. The sender receives
incoming bids, evaluates them, and sends a task offer to the agent with the best
bid. When the next agent has been selected, the sender notifies the controller about
the destination of the batch.
s.s Communication Network
A network is constructed for communication among agents. The network takes

care for either a broadcast throughout the system in the case of a (sub-)task
announcement, or for direct communication between two stations in all other
cases. Rather than defining channels between every pair of agents, a network is
designed that consists of network interfaces and a switch element (see Figure 3). A
network interface is responsible for sending and receiving messages to/from the
connected agent. The switch element connects the network interfaces. Upon
reception of a message, it chooses an interface in order to transfer the message to
the correct agent (Coenen, 1995).
Swltch Element
agent agent agent

Figure 3 Communication network
6 DISCUSSION
In this section, we evaluate the agent based control system, and compare its
characteristics with those of previously specified control architectures. A
hierarchical and a heterarchical control system have been specified for the model
factory (Timmermans, 1993b). We restrict ourselves to a comparison of the agent
based control system with the heterarchical system only. In the latter system,
routings are fixed and depend on the product type. Stations do not negotiate, but
communicate with each other when they want to transfer a batch to the next
station.
Figure 4 shows some simulation results of both models. The horizontal axis
shows the number of jobs simultaneously allowed in the factory, i.e. a type of
input/output contro\. On the vertical axis, the average total completion time for ten
sampIes of one hundred jobs is displayed. The throughput times of the agent based
system are only slightly better than the throughput times of the heterarchical
system. Whereas the heterarchical system does not have routing flexibility at all,
the possibilities of the agent based system to avoid a busy station and direct the
batch to a less busy station are Iimited. This is caused by the absence of alternative
workstations, except for placing components.
The robustness of the agent based system is increased compared to the
heterarchical system, due to the fact that routings were fixed in the latter system,
whereas they are opportunistically 'composed' during operation in the agent based
system. Again, the effect is only marginaIly, since in the present situation only the
component placers can be interchanged to take care of malfunctions. If another
station breaks down, the complete system will be blocked.
The flexibility, i.e. the modifiability of the agents, and the extensibility of the
system, is better in the agent based system than in the heterarchical system.
Stations in the heterarchical control system have knowledge about other stations.
For instance, each station knows its direct 'neighbours'. When the factory is
extended with a new workstation, the information its neighbours have of other
stations needs to be updated. This is not necessary in the agent based system, since
the agents communicate messages via the network. When a new agent is added to
the system, the network is extended with a network interface that is connected to
the new agent. Evidently, the switch component in the communication network of
Figure 3 needs to be updated.
-+- Agents
____ No negotiation
., ...-.......:...
.~--~.., ;::::::::~==-.....f - - -_ _ ____ _ __ _ j
...._._--------......_._-_._--....._._ ....__....
_.
2 3 4 5 6
Number of jobs in the factory
Figure 4 Simulation results
Alternative approaches for a broadcast throughout the system are available. The
drawback of a broadcast to an stations is that an overload of message exchanges
may paralyse the system. An alternative solution would be to apply audience
restriction, for instance by giving the agents local knowledge of other agents'
skills. For an example, the reader is referred to (ümtamessa, 1995).
Another possibility to realise audience restriction is to give intelligence to the
network. In the model factory, workstations communicate with each other via a
network. An intelligent network might transport messages to appropriate agents
only rather than to an agents. This network construction could easily be extended
into a broker. Then, agents report finished jobs (i.e. idle workstations) and jobs to
be executed to the broker, so the broker can match demand and supply of tasks.
The characteristics of the physical production system cause the agent based
system to perform only slightly 'better' than the heterarchical system. This leads us
to the conclusion that the model factory is not a suitable production system for the
application of an agent based control system, and brings up the question in what
situations agent based systems truly make a difference.
We introduce the concept of the routing space here to explain when agent based
systems are most valuable and under which circumstances they can only have
limited impact. The routing space is the set of possible transitions from one
production station to another, and is product specific. Possible transitions can be
specified as ordered pairs of station of origin and destination station. The more the
routing space resembles a function, the less the agent based system is applicable.
When the routing space is a function, at each station of origin a batch can only go
to one station of destination. In this case, a deterministic schedule would suffice to
exploit the 'fun width' of the routing space, because there is no flexibility. That is.,
when a problem occurs, another station cannot be chosen. However, the more the
number of ordered pairs in the routing space exceeds the number of process steps,
i.e. from astation of origin a product can go to many stations of destination, the
more the possibility to compose a schedule through negotiation at run time is going
to be of value. In other words, agent based systems are more suitable in situations
with many interchangeable workstations. However, in case of little uncertainty, a
central scheduler would give more optimal routings and a better performance.
In case the process plan is not fixed, the size of the routing space is also
determined by another factor. The less a certain order between operations is
required, the more transitions from one station to another are possible. The routing
space will increase correspondingly. Control in an 'orderless' situation, in terms of
process plans, requires extensive memory capabilities to keep track of batch
history. Given the characteristics of agents, they are less suitable for such an
orderless situation.
For the same reason of lack of memory capabilities, agent based systems cannot
cope with situations in which it might be more favourable to group operations and
have them performed at one machine. Agents have a quite myopic view, which
might lead to suboptimal routings.
Last but not least, agents prove to be superior in a highly dynamic manufacturing
environment with frequent changes in the production system. Adding or removing
production stations only requires small modifications as compared to conventional
contra I systems.
7 CONCLUSIONS
In "ertain situations, agent based production control systems provide a preferred

alternative to the common architectural paradigms, such as the hierarchical
production control architecture. The suitability of an agent based approach is
dependent on characteristics of the production system, such as uncertainty in
product specifications and process disturbances.
Future work in production contral architecting will focus on the characteristics of
various control architectures and the situations in which they are most appropriate.
Also recently developed ideas, such as holonic manufacturing, the fractal factory,
and bionic manufacturing, have to be taken into account.
8 REFERENCES
Cantamessa, M. (1995). A few notes upon Agent-based Modelling of

Manufacturing Systems, in Proceedings of the C/M at Work conference (ed.
J.c. Wortmann), pp. 301-317.
Chi. (1996). Example available at the Chi homepage. URL:
hup://www.tue.nl/wtb/wpaJse/chi/exam.htm
Coenen, F.WJ. (1995). A heterarchical control structure for flexible
manufacturing systems (in Dutch). MSc Thesis Eindhoven University of
Technology.
Jennings, N. R., P. Faratin, M.J. Johnson, P. 0' Brien, and M.B. Wiegand. (1996).
Using intelligent agents to manage business processes, in Proceedings of the
First International Conference on The Practical Application of Intelligent
Agents and Multi-Agent Technology (PAAM96), pp. 345-360. London, UK.
Lin, G.Y.-J., and J.J. Solberg. (1992). Integrated Shop Floor Control Using
Autonomous Agents.//E Transactions, 24(3), pp. 57-71.
Mortel-Fronczak, J.M. van de, J.E. Rooda, and NJ.M. van den Nieuwelaar.
(1995). Specification of a Flexible Manufacturing System Using Concurrent
Programming. Concurrent Engineering: Research and Applications, 3(3), pp.
187-194.
Smith, R.G. (1980). The Contract Net Protocol: High-Level Communication and
Control in a Distributed Problem Sol ver. IEEE Transactions on Computers,
29(12), pp. 1104-1113.
Timmermans, PJ.M. (1993a). Modular Design of Information Systems for Shop
Floor Contro!. PhD Thesis Eindhoven University ofTechnology.
Timmermans, P. (1993b). Control architectures and modular information systems:

a comparative experiment, in Proceedings of the international conference on
Advances in Production Management Systems (APMS '93), (eds. I.A. Pappas
and I.P. Tatsiopoulos), pp. 387-394. Elsevier Science Publishers.
Upton, D.M., M.M. Barash, and A.M. Matheson. (1991). Architectures and
auctions in manufacturing. International Journal of Computer Integrated
Manufacturing, 4(1), pp. 23-33.
Wiendahl, H.-P., and V. Ahrens. (1995). Knowledge-Based Support for Planning
and Control in Distributed Production Systems, in Proceedings ofthe IFIP 5.7
Working Conference on Managing Concurrent Manufacturing to Improve
Industrial Performance, pp. 429-443.
9 BIOGRAPHY
Arian Zwegers received his M.Sc. degree cum laude from the Eindhoven
University ofTechnology in 1993. Currently, he is preparing his Ph.D. thesis at the
same university. During two years, he was a member of the ESPRIT project
VOICE. His research interests include shop floor control architectures, enterprise
reference architectures and modular software design.
Henk-lan Pels is an assistant professor in the Information Systems Group of the

Department of Industrial Engineering at Eindhoven University of Technology.
Since 1982, he has been researching and teaching databases and data modelling,
especially for manufacturing applications. In 1988, he received his Ph.D. on a
thesis on modular decomposition of data models. After that, he specialised in
architectures for Computer Integrated Manufacturing and Engineering Data
Management. He is also part time consultant for M.I.S. Organisatie Adviseurs.
Raymond Schrijver studied Technology and Society at the Eindhoven University

of Technology (EUT) with a specialisation in Design Methodology. In 1993, he
conducted a survey on Concurrent Engineering in the American industry for the
Dutch Department of Economic Affairs. In 1995, he graduated in benchmarking
for Concurrent Engineering. Currently, he is engaged in a two year advanced
engineering program Computer Aided Design and Manufacturing at the Stan
Ackermans Institute for Technological Design of the EUT.
Roelof van den Berg is a research program director with Baan Institute. He
received his M.Sc. in Industrial Engineering and Management Science cum laude
from Eindhoven University of Technology and will defend his dissertation at the
same institution at the end of 1997. To date he has published over twenty articles
on business modelling, business reengineering, quality management and the
evolution of ERP-systems. Roelof is a member of IFIP's WG 8.2, ACM SIGMIS,
IEEE Computer Society and the AIS.
11
Future enterprise types and strategies
for agile manufacture
I. f)ean and A. ,)'. Carrie

J)epartmenl (d'J)esiKn, Mam4acture and Engineering
Management
[lniversity (d'Strathclyde
75 Monlrose Streel, Glasgow, G1 lXI, UK
Tel: + -1-1 (0) 1-11 5-18 289-1 Fax: +44 (0) 1·:f.1 552 0557
E-mail: a.s.carrie@strath.ac. uk
Abstract
Changes in the global marketplace require manufacturers to consider becoming
agile. This may require manufacturers moving away from mass production
towards the manufacture of mass-custolllised virtual products. A strategy is
needed by such manufacturers to becollle agile. The paper presents a very brief
discussion of the issues associated with agility and COllllllents on the five future
enterprise types proposed by arecent Eureka study. The paper suggests that the
Product ComplexitylMarket Uncertainty Grid provides a useful framework for
discussing the issues surrounding the evolution of a business towards agile
manufacturing and the related forms of lllanufacturing organisation. An
evolutionary path. by which a lllass producer can becollle an agile. virtual product
producer is presented. The Product COlllplexitylMarket Uncertainty Grid also
provides insight into several decision areas. The paper discusses the managerial
implications of these decisions concerning the re-engineering of the production
process. emd the sclection of supporting enterprise type. strategic business unit
operations strategy. market penetration lllethod and degree of control over
business partners.
Keywords
Agile manufacturing. Product ComplexitylMarket Uncertainty Grid, Enterprise
types. Re-engineering.

© 1998 IFIP. Pub1ished by Chapman & Hall
1 INTRODUCTION
Manufacturers are moving away from mass production as the ideal form of
production. Customers used to like keeping up with the Joneses now they want to
be different from the Joneses (Felstead, 1993). Manufacturers now need to be
agile in order to offer different products to different customers. Customers value
these products as unique solutions to their problems.
Some products will still be best made by mass production. Profits will be low on
these products compared to profits made from agile products. Manufacturers will
need to become agile to have a comfortable life rather than surviving. Production
processes will need to be re-engineered for agility.
2 AGILITY
A dichotomy is emerging where products will be made either by mass production

or by agile manufacturing. In fact the choice between becoming a mass producer
or an agile manufacturer may be the only trade-off left in manufacturing (New,
1996). Mass production achieves low unit costs by producing large quantities of
uniform products whereas agile manufacturing is capable of low unit costs while
producing far smaller quantities of high quality, highly customised products
(Goldman and Nagel, 1993). An agile manufacture must be able to compete on
quality. delivery, flexibility and price leadership simultaneously (Roth, 1996).
The agile manufacturer makes virtual products in batches of one close to the
customer to reduce design and delivery time (Oavidow and Malone, 1993). The
virtual product is a product that is customised and produced instantaneously in
response to customer demand (Oavidow and Malone, 1993). Therefore, agile
manufacturing favours smaller scale, modular production facilities, and co-
operation between enterprises (Goldman and Nagel, 1993). Agile manufacturers
stick to what they do weIl - their core competence - and form alliances with
companies with different core competencies. Co-operative initiatives between
firms, and co-operation among strategic business units of the same firm, are
central to agile manufacturing (Goldman and Nagel, 1993).
Research into the implications of agility as part of the Eureka project EU 1005
by the Oepartment for Trade and Industry, hereafter referred to as OTI, (1994)
resulted in the identification of five new generic models of enterprise.
These are:
The Elastic Enterprise
The Flexible Enterprise
The Total Service Enterprise
The Technological Leader
The Virtual Enterprise
Future enterprise types and strategies for agile manufacture I 17
Tbe elastic enterprise is in fact tbe mass producer of tbe future using lean
technologies to adapt to changes in volume and maintain consistent levels of
efficiency. quality and cost. Tbe flexible enterprise can produce a large diversity
of products in relatively small quantities. The total service enterprise develops
long tenn relationships with customers to co-design products with the customer.
The technological leader creates, and is quick to market, new product and
process ideas. Tbe ,rirtual enterprise can identify profitable nicbe markets and
organise itself and its allies to quickly satisfy that market.
Tbe flexible enterprise, total service enterprise, technological leader and virtual
enterprise generic enterprise models bave aspects of agility. Tbe agile
l11anufacturer bas to be flexible producing many different products quickly in
sl11all batches, ideally batches of one. Total service must be given to the customer.
The virtual product is co-designed and formed as a result of the long term
relationship established with the customer. "An agile product is a platJorm for
pr(?fitahle upgrade components and enriching senJices over its entire lifetime. not
an o~ject sold./iJr pn~fit in a one time deal" (Goldman, et al., 1995). Tbe agile
manufacturer has to be tbe tecbnological leader. Investment in research and
development bas to take place to keep supplying solutions to tbe customer. The
agile manufacturer must be able to hire the core competencies of other
manufacturers. Tbe agile manufacturer is a mix of tbese pure models - a flexible,
total service, technological leader witb tbe ability to become a virtual enterprise.
Tbe agile manufacturer must have these aspects, in greater or lesser degrees. but it
lUust have them in order to meet customers' needs.
3 THE PRODUCT COMPLEXITY/MARKET UNCERTAINTY GRID
This study by the DTl (1994) used tbe Product Complexity/Market Uncertainty
Grid, developed by Puttick (1987), to identify different types of manufacturer who
would be affected by the need to become agile. Puttick developed tbe Product
Complexity/Market Uncertainty Grid as a model to help manufacturers recognise
the management implications of the types of products they make. Identifying how
complex the product is (high or low) and tbe level of market uncertainty it faces
(again high or low) identifies a producfs type. Frol11 this grid, a manufacturer can
c1assify its product as commodity, consumer durable, jobbing product or super
value good.
As technology advances what was once a complex product to make becomes a
weIl-known and recognised industry standard becoming obsolete as new, more
complex products bccome available. A market is uncertain when a manufacturer
does not know what products a customer will seek from it.
Figure I shows the Product Complexity/Market Uncertainty Grid along with the
choice of production strategy: agile or mass, and appropriate enterprise type. Once
the product type is known the appropriate production strategy can be selected.
Super value goods. jobbing products and consumer durables are all virtual
products that will need to be made by agile manufacturers. Agile manufacturers
seek partners, be they other strategic business units of the organisation or other
companies. to share the risk when a market is uncertain. A complex product
means that a manufacturer would have to know many production processes.
Altematively. it can, like agile manufacturers, have good links with suppliers who
know their own production processes very weIl. Thus each sticks to the production
processes they know weH - their core competencies. Commodities will continue to
be mass produced. Their market certainty and low product complexity means that
there is low risk and production of the product is easy to master. Figure 1 also
iIlustrates suggested enterprise types that should be adopted to make commodities,
consumer durables, jobbing products and super value goods. These enterprise
types are the integrated enterprise, fractal organisation, extended enterprise, and
virtual organisation respectively.
Product Complexity
.. High Low
High Super Value Goods Jobbing Products

Agile Manufacturing Agile Manufacturing
Virtual Organization Extended Enterprise

Market
Uncertainty
Consumer Durables Commodities
Agile Manufacturing Mass Production
Low Fractal Orromization Integrated Enterprise
Figure 1 The product complexity / market uncertainty Grid
3.1 Evolution
Under intense global competition manufacturers increasingly seek to produce high

value added products rather than goods competing on price. These primarily lie
within the super value goods quadrant of the grid. Similarly, in the era of agile
manufacturing, manufacturers may wish to move to produce super value goods.
Future enterprise types and strategies for agile manufacture 119
This is wherc the best profits will lie - producing tme virtual products for
customers. Customers will pay for products that are vital solutions to the
customer's problem rather than a product that could. aftcr a lot of time and effort
by the customer. be used to solve the problem. The customer sees the
manufacturer adding value and will pay for this. Some manufacturers may be
happy making the level of profits they currently achieve by making commodities.
consumer durables and jobbing products.
Over time the production processes and organisation of the manufacturer could
be adapted to move from making cOlnmodity products to making agile products. It
has been said that "in cvery commodity product there is a differcntiated product
waiting to get ouC (Benson. 1997). There are several examples of this trend. For
example. explosives for the quarrying industry used to be a bulk product
manufactured at the makcr"s plant. Now it is common for the basic ingredients to
be shippcd by tanker to the customer's quarry where they are mixed in situ and
charged for on a basis of the number of tons of quarried rock produced. A
commodity product could have some optional extras added to it for each customer
thus turning it into a conSUl11er durable. Learning from this would then allow thc
manufacturer to offcr jobbing products built especially for each customer from
standard cOl11poncnts. Again learning from this enables thc manufacturer to
design and make complctely new products for each customcr. Such products being
super value goods. Thus the manufacturer evolves from a commodity producer to
a producer of super valuc goods. This evolutionary path is shown in figure 2 as a
dashed line.
Prcduct Complexity
.. High Low
Iligh
Super Value Goods Jobbing Products
.... - - - -- - - - - --~
VirtualOrganisatioo " "

E~<ted Enterprise
,,- "
Market
Unccl1ainty
FractalOrßantsatim Integrated Enterprise
"
.:::::_---- - - - - --
Consumer Durables Commodities
Low
Figure 2 An evolutionary path to agility

Although we have shown a single evolutionary path connecting the four types in
scquence, in practice the path might be more like a tree, such as that depicting the
evolution of ape-like species towards Homo sapiens. Thus so me manufacturers
lllay stop off at each stage with only a limited number evolving to the highest
evolutionary state. In addition, other paths are conceivable, for example a
company might evolve from commodity producer to job shop without going
through thc intermediate state of consumer durable manufacturer. However our
purpose is to illustrate a concept rat her than to present a single definitive model.
and thc rcmainder of the discussion is based upon the path depicted in figure 2.
Adaptation of the production process and organisational form to give production
units morc autonomy will be needed by the manufacturer to move along the
cvolutionary path shown in figure 2 from producing commodities, through
consumcr durables and jobbing products to super value goods. Warnecke (1993)
rccognises this by arguing that alllllass producers must make the step to agility by
bccoming a fractal organisation. Others prefer the term holon to fractal, in the
contcxt of holonic manufacture (van Leweren and Norrie, 1997), although the
principles arc much the same. Boynton, et al.. (1993) argue that a manufacturer
can become agile by first seeking continuous improvement then mass customising.
The manufacturer will first need to become an extended enterprise (Barber, 1993).
This will requirc a lot of effort (resources, people and money) and time. Once it is
an cxtcnded enterprise it ean make another push to become part of a virtual
organisation.
3.2 Commodities
There will always be products whose standard form can rcadily solve the
customer's problems. For these produets price will continue to bc the deciding
factor. Thc manufacturer will need to keep costs down whilst being able to supply
the customer immediately. Therefore logistics and production process technology
bccome central core cOlupetencies for such a manufacturer. Costs are best
controlled in an intcgrated enterprisc, such as functionally based mass production
favoured by lllany manufacturers in the 20th century. The manufacturer can
readily keep an cye on all costs and take corrective action when needed. There
will bc profit in such products but it will be low compared to the profits made by
manufacturers supplying virtual products.
3.3 Consurner Durables
All that the customcr may seck in a virtual product to solve its problem is a
standard commodity product that is adapted to its needs. In this case thc customer
regards value for money as bcing more important than fitness for purpose or
timeliness. Thc production proccss will necd to bc just flexible enough to allow
the product to be configured to the customer's needs. Different markets may
require different adaptations. Thus a fractal organisation (Warnecke. 1(93) will

be necessary. This will involve establishing similar facilities in each market each
just flexible enough to make the adapted product. These production facilities are
the transplants that many manufacturers use to make products tailored to local
market requirements.
3.4 Jobbing Products
Assembling standard components together in a unique way for that customer can
make virtual products. This unique way is a timely solution to the customer's
problem. lt is acceptable for the customer who cannot wait for a super value good
to be developed. This requires an extended enterprise where the manufacturer
purchases standard components from a network of key suppliers. each with an
inimitable core competence. "The extended enterprise is rooted in the concept of
ou(sourcing" (Barber. 1(93). In the extended enterprise. co-operation takes place
between firms carrying out different activities within the same general process.
firms that operate at different points in the supply chain (Busby and Fan. 1(93).
This co-operation is based upon contract law. unlike the virtual corporation that is
built more on trust.
The ability to mix and match these components is a core competence of the
manufacturer. The extended enterprise requires a tight fit and true synergy
between trading partners (Barber. 1993). Thus the manufacturer will need to
devote resources to knowledge. The key to this is knowledge transfer. the sharing
of existing knowledge and the infrastructure to share new knowledge (Busby and
Fan. 1(93). The production process will need to be flexible to allow for these
standard components to be combined in different ways.
An example of the extended enterprise is the franchised factory (Dean and
Carrie. 1996). A manufacturer can enter new markets by replicating its
production process to a manufacturing company already supplying that market.
Selling a franchise - the license to use the production process for an initial fee and
royalties. does this. Each franchised factory becomes the supplier of the virtual
product on behalf of the extended enterprise. for a specified market. With
production franchised out in effect outsourced. the manufacturer. known as the
franchiser. can concentrate on organising the supply of support services. such as
research and development marketing. accountancy: by itself or from other
specialist firms. These manufacturing companies who have purchased the
franchise are known as franchisees and pay for support services as part of their
royalty payments to the franchiser.
Each franchisee is. in law. a separate business from the franchiser. However. the
franchiser through a contract - the franchise agreement - controls the franchisees.
The franchise agreement gives the franchiser considerable power over franchisees.
Relationships can only be established with the permission of the franchiser.
Franchisees are geographically dispersed so that franchisees cannot readily
compare their experiences with the franchisers. The franchisees can only establish
a franchise association with the pennission of the franchisee. Thus the franchised
factory cannot be a virtual organisation since relationships are built on contracts
rather than trust. The franchise operations manual allows the transfer of
knowledge initially between the franchiser and the franchisees. However, as
franchisees develop new product and process ideas. these product and process
ideas are added to the franchise operations manual and shared with all partners in
the franchise network.
3.5 Super Value Goods
These are true virtual products. These are usually one-off products tImt need a lot
of research and development (R&D) for their inception. Examples include defence
products such as radar and aeroplanes both military and commercial. Knowledge
acquisition to aid product creation is vital for the success of the project. This R&D
is too much for one finn to supply. Therefore a consortium is formed. Each
member's core competence is pulled for the benefit of all. A virtual organisation is
formed. Customers are seeking fitness for purpose so product design and
development are necessary core competencies of the virtual organisation. Today a
core competency in information teclmology is also needed to help the consortium
communicate and manage design data.
4 MANAGERIAL IMPLICATIONS
The type of product a manufacturer wishes to make determines the method of

manufacture. When the product's complexity and the certainty of a market for the
product are identified the type of product can be derived using the Product
ComplexitylMarket Uncertainty Grid. This grid allows the production strategy
(agile manufacturing or mass production) to be elicited. Decisions can be taken
that allow the:
Production process to be re-engineered,
Organisation to be fonned,
Strategic business unit strategy identified.
Method of market penetration to be selected,
Amount of control over partners to be detennined.
Table I shows these decisions derived from product type moving left to right.
By knowing the product type, a manufacturer can select the appropriate
production process and organisation to support production of that product. The
strategy of the strategic business unit making that product and method of market
penetration can also be identified. The degree of control over partners that the
manufacturer will have can then be recognised. The following paragraphs explain
the implications of these decisions for manufacturers making. or wishing to make.

commodities. consumer durables, jobbing products or super value goods.
Table 1 Decisions derived from product type
Product type Process Enterprise Operations Market Degree of

Focus type strategy penetration control
method
Super value Project Virtual Tedmological Licensing Little
goods organisation frontiersman
Cost Joint
..
JUllUJUlsmg venture
custoJUiser
Johhing Facility Extended Technological Franchising More
products enterprise servIceman
Consumer Matter Fractal Technological Wholly Suhstantial
durahles organisation exploiter owned
suhsidiary
Customiser New hranch
COllunodities Transac- Integrated Cost Export Complete
tion enterprise mml1111ser
O'Brien (1995) argues that the type of process sought from a business process
re-engineering exercise will result in different decisions having to be made. For
example, the issues to resolve to move the production process from transaction-
based to matter-based will be different from those issues that need to be resolved
to move from a matter-based to a facility-based production process.
To make commodity products the mass producer will necd to be an integrated
enterprise. The production process will be transaction based (O'Brien. 1995) to
minimise costs (Harris. et al.. 1994). Concentrating production in one plant and
exporting around the world can reduce costs. Management has complete control
over this plant.
A manufacturer can take standard products and customise them by adding
optional extras to make consumer durables. These are customisers according to
Richardson. er al., (1984) and Harris, et al., (1994). The production process will
need to be re-engineered from transaction based to matter based (O'Brien. 1995)
with a fractal organisation structure adopted. This fractal structure will give the
manufacturer substantial control over its subsidiaries. Such a manufacturer prefers
to own subsidiaries if possible. Competitors who complement the product range or
have technologies that call help the manufacturer are sought as targets to become
wholly owned subsidiaries. In this respect the manufacturer is a technological
exploiter (Richardson, et al., 1984 and Harris, et al., 1994). Alternatively. new
branches are established in the new market.
124 Part Two Next Generation Manujacturing Systems
A manufacturer might treat the virtual product as a jobbing product where a

new product is constructed from standard components. Such manufacturers will
have mastered the production technology and know how to use it to combine
components to meet customers needs. They are technological serviceman
(Richardson. et al.. 1984 and Harris, et al., 1994). To do this a manufacturer will
establish an extended enterprise. The production process will be facility based
(O'Brien, 1995). The production process will be adapted at each facility to make
different products. Production facilities can readily be replicated through
franchising giving the manufacturer more control.
A manufacturer seeking to make super value goods will be truly agile. Each
super value good will be a project in its own right (O'Brien, 1995) causing a
virtual organisation to be fonned through joint venturing and licensing. Members
of this virtual organisation will be technological frontiersmen or cost minimising
customisers (Richardson, et al.. 1984 and Harris, et al., 1994) due to their ability
to cxploit their investment in research and development. Such a manufacturer will
want little control over partners in order to give them freedom to exploit their own
expertise for the benefit of the virtual product.
5 CONCLUSION
In the recent past. when standard products sufficed, mass production was seen as
the ideal. Now in the transition to agile manufacturing manufacturers have to
choose their means of manufacture: mass or agile. This paper has presented the
Product Complexity/Market Uncertainty Grid as a useful aid for this decision.
This paper has shown that manufacturers may need to evolve their product and
organise for agility by selecting an enterprise type based on the virtual
organisation. extended enterprise (including the franchised factory) and the fractal
organisation. From this. decisions on strategic business unit strategy. market
penetration method and degree of control over partners can be made. This paper
has demonstrated that with the help of Product Complexity/Market Uncertainty
Grid a manufacturer can create a strategy to become agile. Manufacturers can use
the fractal organisation and the franchised factory as stepping stones to move
from mass production to agile manufacturing.
6 REFERENCES
Barber. N. F. (1993). Electronic Commerce: Toward the virtual corporation. EDI

Forum. 6(4), pp. 18-22.
Benson, R. (1997), oral presentation to the Foresight Manufacturing, Production
and Business Processes Panel, DTI, London, 11 May.
Boynton. A c.. Victor. B. and Pine. B. I. (1993), New Competitive Strategies:

Challenges to organisations and information technology. IBM ,~vstems
Journal. 32(1). pp. 40-64.
Busby. I. S. and Fan, I. S. (1993), The Extended Manufacturing Enterprise: Its
nature and its needs. International Journal of Technology Alanagement, 8(3-
5). pp. 294-308.
Davidow. W. H. and Malone. M. S. (1993), The Virtual Corporation.
HarperBusiness. New York.
Dean. I. and Carrie. A S. (1996), The Franchised Factory - A New Paradigm for
Manufacturing. In: Proceedings of the European Operations Management
Association C'onference on Manufacturing Strategv: Operations strategv in a
glohal context, (c. A Voss (Ed.». pp. 159-164.
Department for Trade and Industry. (1994), Factm'y jiJr the Future: ,S:vnopsis of
final report. Eureka project number EU 1005, HMSO, London.
Felstead. A (1993). The C'orporate Paradox: Power and control in the business
franchise, Routledge. London.
Goldman. S. L. and. NageL R. N. (1993). Management. Technology and Agility:
The emergence of a new era in manufacturing. International Journal of
Technology Management. 8(1-2), pp. 18-38.
Goldman. S. L.. NageL R. N. and Preiss. K. (1995). Agile Competitors and
J irtual Organizations: Strategies jiJr enriching the customer, Van Nostrand
Reinhold. New York.
Harris. 1.. Grenhaigh. I. and Frizelle, G. (1994), CIM 2000: Manufacturing in the
21st century. In: BPICS Annual Conference Proceedings.
New. C. (1996), Manufacturing and Corporate Strategy: Integration and focus
polarisation. In: Proceedings of the European Operations Alanagement
Association Conference on Manufacturing Strategv: Operations strategv in a
glohal context. (c. A Voss (Ed.». pp. 477-482.
O'Brien. B. (1995). Decisions about Re-engineering: Briefings on issues and
options. Chapman and Hall, London.
Puttick. I. (1987). Marketing Pull - Manufacturing Push: Springboard for
competitive advantage. In: The Management of Manufacturing: The
competitive edge. (R. P. Toone and D. Jackson (Ed.», pp. 13-26. IFS
(Publications) Ltd, London.
Richardson, P.R.. Taylor. AI. and Gordon, I.R.M. (1984), A Strategic Approach
to Evaluating Performance. Interfaces, 15(6), pp. 15-27.
Roth. A V. (1996). Competitive Progression Theory: Explanation and evidence.
In: Proceedings (~r the European Operations Afanagement Association
C'onference on Manufacturing ,S'trategv: Operations strategv in aglohaI
context. (c. A Voss (Ed.». pp. 563-568.
van Leweren. E.H. and Norrie, D. (1997). Holons and holarchies. Manufacturing
Engineer. ApriL pp. 86-88.
Warnecke. H. I. (1993). The Fractal Company. Springer-Verlag. Berlin.
7 BIOGRAPHIES
PROFESSOR ALLAN S CARRIE Allan Carrie is Head of the Department of De-

sign, Manufacture and Engineering Management at the University of Strathclyde.
He also served a term as Head of Department from 1990 to 1992. He is aChartered
Engineer, Fellow of the IEE and Senior Member of the Institute of Electrical and
Electronics Engineers of USA. He is a Member of the Institute of Operations Man-
agement and is a Fellow of the Royal Society of Arts. He is also a member of the UK
Technology Foresight Programme's Manufacturing Production and Business Pro-
cesses Panel, Chairman of the Subgroup on the Electronics Industry and is currently
a member ofthe EPSRC's College ofPeers for Design and Integrated Production. He
is a member of the Working Group on Computer-aided Production Management of
the International Federation for Information Processing. He was Academic Leader
on the Master of Technology Management Study Mission to Korea in 1997, Singa-
pore in 1996 and USA in 1995.
On leaving school he joined Babcock and Wilcox as a Student Apprentice. After
graduating in Mechanical Engineering, he completed practical training and served
for a time as an Industrial Engineer. He left Babcock's to undertake postgraduate
studies in Engineering Production at Birmingham University. He then worked as
an Industrial Engineer with Northern Electric in Montreal, Canada. He joined the
University of Strathclyde in 1968.
His research interests lie in the field of manufacturing systems and production
management. He was awarded his PhD in 1976 for the development of an integrated
package for plant layout and group technology. In the early 1980s he researched the
application of personal computers to production control and simulation modelling
of flexible manufacturing systems. Current contracts include projects on Perfor-
mance Measurement Systems and on Manufacturing Franchising, both with funding
from EPSRC and industrial collaborators. He recently completed a research project
into Manufacturing Integration. He has worked extensively with industry, especially
through Teaching Company Programmes. He is the author of a book entitled Simula-
tion of Manufacturing Systems, has contributed to several other books and published
over 100 papers. He has presented his work in several countries in Europe, North
America and Asia.
IAN DEAN Ian Dean was a postgraduate student in the Department of Design, Man-
ufacture and Engineering Management between 1994 and 1996.
PARTTHREE
Benchmarking
12
Performance analysis through
benchmarking and recognition of
patterns
Univ.-Proj Dr. Horst Wildemann

Department 0/ Business Administration
with emphasis on Logistics
Technical University 0/ Munich
Leopoldstrasse 145, 80804 Munieh, Germany,
Tel: +49-89-36078-100 Fax: +49-89-36078-111
ABSTRACT
Benchmarking should make it possible to expand the knowledge through methods
and strategies and to derive appropriate actions for the own company. Central
principal in benchmarking is the analogy-based comparison. An analysis within the
framework of a study group with 23 companies shows that especially the search for
reasonable data and the handling of the quantity of information makes many
problems. Bilateral benchmarking projects show that regardless of the industrial
branch learning effects can be realized through benchmark comparisons. Especially
a comparison of business processes based on defined ratios and process-analysis is
promising. As an approach to solving a problem for the identification of the best
solution a recognition of patterns is being proposed. Recognition of patterns means
the filtering of figures of different ratios and characteristics of best practices and
efficient business processes out of a large data base. Not anymore single ratios,
rather expressions in several dimensions are goals of benchmarking. On a basis of
282 european companies, patterns of organizational structures, cost structures,
product attributes, and dient relationships of successful companies are exemplarily
being demonstrated.
Keywords:
Benchmarking, performance analysis, recognition of pattern, performance
measurement, organizational leaming, business process management, process
benchmarking.
130 Part Three Benchmarking
1 PROBLEM TASK
Benchmarking means independent of markets, products and local point of views to

aim for a comparison with the best practices. Benchmarking can be defined as a
continuous and systematic process for the determination of exceptional methods and
activities which allow arecord performance. This record performance can be related
to product development, process control, service supply or the use of certain
methods. In benchmarking it depends on analyzing the efficiency of companies in
different industrial branches and market segments. Effects of interdependencies
between structural business features, used methods, rapideness in the
implementation of objectives, and the fulfilment of factors of performance have to
be made transparent to insure that target-orientated measures can be derived. Based
on these requirements two different solutions attempts have been developed to be
able to identify differences in positions: benchmarking of business processes and
performance analysis through recognition of patterns.
2 PROCESS-BENCHMARKING
Within a framework of a study group containing 23 european industrial entetprises

requirements of success of benchmarking were elaborated. As a result it sbowed that
benchmarking of business processes is a particular successful approach. Tbe general
analysis of business processes gives the opportunity not only to analyze differences
in the efficiency of processes, it also offers an evaluation of the effectiveness in
terms of contribution to company success and in terms of fulfilment of dient
requests. An essential requirement of this is the guarantee of comparisons of
business processes in-between companies of different industrial brancbes as weIl as
the applicability of potential performance improvements. Therefore a framework
was developed in co-operation with the companies whicb has been approved in
several case studies (see figure 1).
In the scope of the purcbasing for instance a comparison in-between different
industrial branches bas been performed. The brancbes were mechanical engineering
and electrical engineering. The concentration was not that much on the comparison
of processes as it was on methods wbicb are suitable for identifying potentials in
purcbasing. It sbowed that there are several points of attacbment in areas of
purcbasing organization, order processing, supplier selection and supplier
development, whicb were being identified by the respective experts inside their own
company as weIl as in foreign companies. The performance in the scope 01'
purchasing measured by productivity-ratios sucb as volume 01' purchasing or
supplier per employee was raised more than 15%.
Performance analysis through benchmarking and recogllitioll 0/ patterns 131
Dafinftion Ways
and 01
tar!!el bench·
setting marking
doftnition PIOCH.
ond l1op.
valUli chain ono/y1i.
ono/y1i.
Figure 1 Benchmarking framework
Defming concrete performance-ratios at the beginning of the comparisons is of high

importance to prove performance-gaps. In this context it is not necessary to analyze
a multitude of isolated ratios rather than analyzing a few ratios which are distincted
very differently in the companies. With this procedure differences of performance
can be concluded with certainty. Besides a process analysis wh ich is indispansible
for the comprehension of the processes inside the compared companies, a procedure
has been approved in which the respective best solution in the sense of a zero-
based-budgeting can be combined to an ideal reference-model. The single solutions
are being developed inside the involved companies or within the team. With this
procedure of such a comparison with an ideal process for instance the lead time of a
manufacturer of household utensils was reduced by more than 20%.
3 PERFORMANCE ANALYSIS THROUGH RECOGNITION OF

PATIERNS
In practice it shows that in the search of particularly efficient companies often the
mistake of comparing a multitude of ratios is being done. The performance
differentiate mostly only at certain points and the compared companies do not show
in all analysed ratios significant advantages. In mooy cases comparative data exist
only for certain parameters so that it is impossible to give dear interpretation. Due
to the heterogeneity of the raw data and numerous influencing factors on the
expressiveness of the gathered performance-ratios as weH as the accelerated dynarnic
(declining validity of raw data), the practicability of a benchmarking process
without electronic data-processing support cannot be done efficiently. A
conventional data base system which exceptionally compares ratios supports
exclusively the data management. However for the diversion of need for action and
improvement potentials it gives too little support.
Necessary therefore is a decision-support-system and an action-orientated

diagnostic instrument. This was developed in strong co-operation with industrial
companies within the study group. With the help of this system important
parameters of successful industrial companies in form of descriptive attributes shall
be identified. The evaluation of the performance of a company and its business
processes is based on critical success dimensions such as logistics- and innovation-
performance, or customer- and employee-orientation. Instead of a comparison of
individual ratios in separate isolated levels of comparison a classification system
was searched for, to offer a wider point of view for the evaluation of performance.
Input • Output •
80 7
turnover ~~~":._ _• •.-_~. purchaslng
branch • production
• planning and controlling
• organlzatlon
• quality management
o 100
IP(O))
~
1inanclal performance
wa ste
o 100
Iindoxi
Figure 2 Classification through a neuronal network
Different kinds of classification methods, e.g. statistical methods like

discriminance-analysis, geometrical methods and latest developments like neuronal
networks have been analyzed and evaluated. What are neuronal networks? Artificial
neuronal networks try to simulate the structure and the corresponding behaviour of
a natural brain. They are able to improve their performance during the learning
stage independently, which enables them to train complex patterns and to classify
them with a very good reclassification-ratio. Statistical methods, e.g. usually
assume independence within the data, what is not tenable in a business
environment. The results of a geometrical classification are very dependent on the
order of classification. After the evaluation of different possibilities, a neuronal
network seemed to be the most efficient tool. Within the group of neuronal
networks different designs have been considered, such as Hopfield-network, single-
or multi-Iayer-perceptrons. Due to its high flexibility a multi-Iayer-perceptron was
implemented. Figure 2 shows the structure the network is based on. The
Performance analysis through benchmarking and recognitioll ofpatterns 133
recognition of patterns has two levels: The company or a certain process is being
pictured through a pattern and a classification to certain clusters can be done with
this recognition-of-patterns-system.
Mter feeding the system with an initial pattern, the result of the classification are
two new patterns, which give an idea about the probability of success for
reorganizational measures in the predefined 7 areas and the company's performance
in 5 dimensions (see figure 2).
The previous one-dimensional sight of a single criterion is being replaced by a
pattern which can be characterized by an unlimited number of attributes. The
objective therefore has to be trying to achieve the constellation of a target-pattern or
the pattern of a successful company instead of the dimension of a single ratio. The
decision over the performance of a certain pattern constellation can be made with a
classification system. For the purpose of automation the classification-system was
taught through learning samples. For successful manufacturing companies for
instance it is possible to derive interdependencies in-between company size, vertical
range of manufacture, and production equipment regardless of the industrial branch.
Large, successful companies are often characterised by a low vertical range of
manufacture, and have efficient supplier so that employment fluctuation can be
compensated through a transfer within the value chain. Successful, smaller
companies though can even compensate sales volitality with a high vertical range
of added value. This is possible if they can call a customer-orientated just-in-time
production their own and if they are able to adjust their warehousing to their
volume of output. Different pattern constellations exist for instance for the
organization, production structure, cost structure, and for the sales structure for very
successful and less successful companies even within an industrial branch (see
figure 3).
4 EXPECTED RESULTS
With the benchmarking of business processes it is possible to identify potentials of

improvement in costs, time and quality very fast. 1t is possible to realize
organizational learning by identifying the respectively best solution and if the
concrete implementation is realized within the own company. An essential
advantage is that the learning process is not animated by theoretical or external
knowledge, it is furthermore stimulated on a basis of a vivid comparison.
data
~:-;.:-:-;.:-~-~ variety 01
coot. variants
shareof
logistlc 00013 - - success'ful
investment share companies
01 the budget - less success1u
comp.nies
Figure 3 Cost structure (example)
The recognition of patterns enables the positioning of a company, the identification

of several target patterns, as weIl as a purposive selection of potential promising
reengineering priorities. It becomes possible to determine target ranges in
distinctive dimensions and to raise the evidential value of benchmark comparisons.
At the same time the costs for data collection decreases considerably. With the
connection of company-related and process-related ratios it is possible to
prognosticate potentials of improvement with a high accuracy. With the orientation
of several ratios instead of focusing on just one best-practice-value the obtainability
of goals can be raised which has a positive effect on the motivation.
5 STAKEHOLDERS
The results of the analysis are interesting for manufacturing concerns as weIl as for
trade and service. The benefit of benchmarking is not attached to a certain company
size or an industrial branch. Furthermore the composition of companies out of
different industrial branches is the key for a successful benchmarking.
6 STATE
The named concepts have already been implemented in several case studies. Specific
statements of achieved results in practice already exist.
Performance analysis through benchmarking and recognition 0/ patterns 135
7 REFERENCES
Mertens, P. (1977): Die Theorie der Mustererkennung in den

Wirtschaftswissenschaften, in: ztbF, Heft 11, 29. Jg. 1977, S.777-794.
Wildemann, H. (1995): Produktionscontrolling, 2. neub. Auflage, München 1995.
Wildemann, H. (1996): Fertigungsstrategien, 3. Auflage, München 1996.
8 BIOGRAPHY
Prof. Dr. Horst Wildemann studied engineering (Dipl.-Ing.) and industrial

management (Dipl.-Kfm.) in Aachen and Cologne. After several years of working-
experience as an engineer in the automobil-industry he graduated to Dr. rer. pol. in
1974. Stays abroad at the International Management Institute at Broxelles and at
american universities followed. In 1980 he completed his habilitation at the
University of Cologne. Since 1980 he is working as a regular professor at the
department of industrial management at the University of Bayreuth and Passau and
the Technical University of Munich. He was offered a chair at the University of
Stuttgart-Hohenheim and Dortmund, at the free University and Technical University
Berlin and University of St. Gallen. Besides his research and lecture activities he is
head of a research institute for strategic planning and logistics at the Technical
University of Munich at which more than 50 people are employed. In 20 books and
more than 200 essays, which an bad been influenced by empirical findings, he
showed new economic ways of how to organize and ron a "company with a future".
For leading industrial companies, Wildemann serves as a management consultant
and as member of the supervisory board.
13
Virtual benchmarking in logistics:
.A concept for the determination of
benchmarks
Volker Hornung, Holger Luczak, Marcel Oster

Research Institute for Operations Management (FIR)
Aachen University ofTechnology
Pontdriesch 14/16
52062 Aachen, Germany
Tel: +49-241-47705-62, Fax: +49-241-402401
os@fir.rwth-aachen.de
Abstract
Benchmarking has been discussed controversially in the past as a method to 1earn
about processes of other companies known for their outstanding capabilities.
Identifying best-in-class companies in specific processes is difficult. Comparable
benchmarks are scarce and influential factors have a Iarge impact on the
performance. Therefore the virtual benchmarking concept has been developed.
First step was to define the objectives in logistics. In order to transfer the
objectives into processes, a set of top priority logistics measures along with
influential factors has been developed and validated. The concept was filied with
empirical data from more than 120 companies and transformed into a software tool
called LOGCHECK. It presents an appropriate possibility to gain information about
benchmarks in logistics, depending on the conditions influencing a company. The
virtual benchmarks are immediately available after an analysis of the respective
company's conditions. The database is constantly updated.
Keywords
Benchmarking, Logistics, Measures, Influential Factors, Virtual Benchmarking

Virtual benchmarking in logistics 137
1 BENCHMARKING
With more complex production processes, increasing automation, numbers of

products, and variety leaving limited possibilities to improve production,
companies are facing and focusing on higher demands of their logistic
performance. The perceptible performance of logistics processes such as delivery
service, delivery reliability or fast response determines today, beside price and
product quality, the difference to competitors. The quality of logistics
performance and services becomes more important as design and product features
become more and more similar and comparable. But leadership in logistics
performance should not be bought by high costs in logistics for large stocks etc.
What must therefore be found are efficient, innovative processes meeting highest
customer expectations at low costs, known as to be reliable. The questions to be
answered are: What process quality is achievable and what are the processes
leading to superior performance? Benchmarking tries to answer those questions,
allowing and promoting new ideas while setting realistic targets.
1.1 Benchmarking Process
The goal of benchmarking is to compare products, methods or processes of

different companies or divisions, to evaluate the weak points and to find the best
processes and methods applicable in the own company: best practices. A
benchmarking study should be made in co-operation with companies known as
best-in-class concerning the subject to be compared. Benchmarking is also used
to leam how that excellence is achieved by the best-in-class companies.
Therefore, the collection of quantitative data must be followed by the
identification of reasons for a superior performance. Final goal is not only to
obtain measures and identify the gap, but to even surpass the measured
performance and become the best by adapting the best practices considering the
specific conditions of the own company.
The partners should be the best-in-class and must operate under comparable
conditions. Finding the best-in-class can be a difficult task, persuading them to
participate in a benchmarking study even more. Companies have difficulties
revealing how they work to others.
The selection of the right benchmarking partner plays a key role for the success
of a benchmarking study. Two basic principles can be distinguished:
• Internal benchmarking with own separate divisions, profit centers, plants or
departments and
• extern al benchmarking with different companies acting in the same or
different industries.
Bach of them has advantages, and especially the possibility of getting reliable
data from other subsidiaries should not be neglected. The price of being able to
gather data very quickly with internal benchmarking is the limited angle of view
when only different subsidiaries are compared with one another.
1.2 Benchmarking and Logistics

The quality of logistics processes strongly depends on the quality and the
availability of information offering possibilites to leam about the present state.
This often leads to questions as:
• What are the potentials of our logistics?
• Is our stock level too high compared with others?
• Are our logistics costs accurate?
• How can those information be quantified?
Success factors have extended from the two dimensions quality and costs to the
third dimension logistics performance. Taking into account that the share of
logistic costs in tumover can reach up to 30% underlines why an optimized
logistic performance by reduced costs is of major interest in global markets.
Benchmarking in logistics can help answering these questions.
1.3 C1assical Data Sources for Benchmarks
How can measures about the performance of others and especially information
about best-in-class be obtained? The three basic principles are shown in Figure 1.
o 'beSI.prac/ice ' o Inlemal dala b8ses/

inlerviews Sl81is tics/evalua 60ns
o Compelilor o Exisling musure
sUfVeillance syslems
o Produclion planning· .
produclion control·,
,nd adminislrative dal.
eFiR 1996
Figure 1 Data sources

1.4 Problems with the Realization
The realization of positive effects is as difficult as the benchmarking principle

sounds promising.
• Benchmarking is based on mutuality. Since a benchmarking study usually is
not done anonymously between two companies, the selection of the partner
and the collection of the partly very sensible data causes a lot of problems.
Only the comparison with a better or the best is useful, but companies must be
persuaded to participate. All the involved parties must draw their advantages
from the study. This is the reason why extemal studies are normally only
conducted between companies not being direct competitors in the same
market.
• If a company decides to carry out an extemal benchmarking study, it often
lacks the knowledge of who is the best-in-class in other markets because
differences in the subjects to compare may have an impact on the comparison.
• Not to be neglected is the investment of time and workforce necessary to
accomplish a successful benchmarking study.
Those are some reasons, why in Europe and especially in Germany bench-
marking is not widely used and if so, it is often only done between subsidiaries of
large scale companies. Most of them are subsidiaries from American companies.
Arecent study and contacts with company representatives revealed that
companies although they are of large scale, wen known andlor multinational
oriented still have problems finding benchmarking partners. If they find a partner,
they prefer to keep their experience of how to conduct a benchmarking study
secret. This explains the motivation for the work undertaken. There is a need for
the immediate, cost effective determination of benchmarks from really
comparable companies.
2 VIRTUAL BENCHMARKING CONCEPT
Since partners are hard to find and the benchmarking process is not widely
accepted, the "virtual" benchmarking concept has been developed at the
Forschungsinstitut für Rationalisierung (FlR) at Aachen University of
Technology (RWTH Aachen) using a different approach. The concept tries to
avoid the above mentioned problems. Starting point has been a research project
made to determine the influential factors on measures in logistics, independent
from the industrial sector. Sector measures are usually distributed by federations
or statistical offices. Such measures only have a limited benefit for practical use
when comparing different companies since the influencing factors vary from
company to company as wen as the measure definitions. Furthermore they
normally present average values and do not offer any data for best practice
performance.
Usually, only isolated measures (baving few connections between eacb otber)
are taken but rarely embedded in a measurement system. Anotber main problem
is tbat only mean values for wbole industrial sectors are available, not reflecting
tbe influential factors representing tbe real situation a company is in. Influential
factors sucb as requirements explosion, production program planning support,
structure of suppliers and customers etc. are not considered. Tberefore, tbe
comparison of measures between two or more companies is limited to average
values.
2.1 Empirical Basis
Tbe objectives of tbe researcb project were tbe derivation of a measurement

system for intercompany comparison in logistics foHowed by an evaluation of tbe
factors baving an influence on tbe measures and tbe development of
intercompany measures. Figure 2 sbows tbe steps of tbe researcb project tbat lead
to tbe software tool LOGCHECK.
Starting point was tbe development of an objective's system for logistics. Based
on tbe main objectives of a company, tbe objectives in logistics were derived.
Tbey can be separated into performance objectives and cost objectives.
Performance objectives are: to ensure tbe market supply, to ensure production
supply, and to improve amount and delivery reliability. Cost objectives are:
optimized stocks and work in progress, reduced lead times, optimized capacity
utilization and reduced logistics costs. Tbose objectives are independent from a
specific company or an industrial sectors. In order to maintain tbis general
validity tbe objectives were not subdivided furtber.
Procedur.
0.,. b... i, 1110 ,.rvor in Iho .. cl." ./:

. m.ch.nic.l.nginuring
. •'.ctlic.'.ngjn."ing
• OME '.pp"''''
CFIR tU6
Figure 2 Project steps
Tbe next step was to develop a measure system. A first study lead to a
catalogue of more tban 200 logistics measures. Tbey were cbecked for general
validity, relevance in practice and possibilities to record tbem as weH as tbe
degree of tbeir coverage of logistics. Based on discussions witb experts and a
comparison with the objectives a set of 23 measures was derived. The measures
derived are for example: delivery reliability of finished goods or delivery
reliability of spare parts, range of finished goods, range of raw material and
production supplies, rate of delay or incorrect supplies towards the customer, rate
of delivery delay, utilization rates ofproduction means, share of stock in turnover
or share of logistics costs in turnover etc. Especially the share of logistics costs in
tumover created difficulties during the analysis due to different types of cost and
varying cost centers from company to company. Therefore the incomparable
parts as e.g. costs for delivery, which is only depending from the distance
between supplier and customer, were excluded for the calculation.
The value of a measure strongly depends on the characteristics of a company
and the market conditions under which it is working. An intercompany
comparison can therefore only be valid, if similar types of companies are
compared one with another. For a comparison significant influential factors must
be taken into account. Again a first study revealed a catalogue of more then 200
influential factors which were also checked for general validity, relevance in
practice, and cleamess. This lead to 35 potential influential factors such as type
of order, type of production, type of product structure, type of stockpiling etc.
Each influential factor is described through up to four characteristics. Some
characteristics combinations are also allowed.
Now that a catalogue of measures and a catalogue of potential influential
factors existed, the next step was to determine the influence of the influential
factors on each measure. Two questions had to be answered. First which of the
potential influential factors does really have a statistical significant influence on
measure values, and second how can, based on the results of the first question,
intercompany measures be derived?
A data collection was carried out via a questionnaire sent to mainly small and
medium sized enterprises of different industrial sectors. The standardized
questionnaire includes the 23 measures and the 35 influential factors together
with its precise definitions. The database build with the results of the
questionnaire now contains more than 120 companies and each time a company
participates in a new study its data are added to the database.
Based on these data, a significance analysis was done, using statistical Kruskal-
Wallis-tests to find those factors, having a statistical valid influence on measures.
For each measure it was tested, whether each potential influential factor has a
significant influence. Mter that, each of the 23 measures was evaluated for every
of the significant influential factors. In Figure 3 significant influential facotrs for
some measures are shown. The complete table is the basis for calculating the
"virtual" benchmarks. This measure catalogue allows to draw individual
measures for each type of company with every possible influential factor
combination. For every measure not only the mean and the median value can be
calculated, but also a tolerance range. The tolerance range is defined through the
25 % percentile and the 75 % percentile. The result of the calculation is a
comparison of the current state of a company with the 'should be' state given
tbrough the combination of the other companies.
Measure.
!i
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.t
ii ii
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i f
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Influential Factors
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Figure 3 The data base
The measures can be calculated independently from the industrial sector. Like
in benchmarking, the independence from the industrial sector is one of the key
advantages.
2.2 Virtual Companies and Virtual Benchmarking
In a second step the concept was extended to not only calculating average values
and tolerance ranges, but also benchmarks by finding out maxima or minima,
depending on the measure to be compared.
A comparison between companies can be done in different ways. A direct
comparison assumes, that a best-in-class company regarding the process to be
improved is found, and this company is willing to participate in a comparison.
The anonymous comparison is carried out by a neutral third party (usually
consultants) providing data of comparable companies. The comparison with
"virtual" companies uses the survey based data to generate a "virtual" company
with comparable influential factors. The analogy between the current state and
how it 'should be' is what leads to the tenn "virtual" companies. In contrast to the
results of one's own ,,real" company, a "virtual" company is buHt through a

combination of comparable companies. A company that does not exist in reality.
It is buHt through the results of the survey. The comparison of both benchmarking
methods is shown in (Figure 4).
C "".. ,run
o Prt1ct ...... I... ding 10 ,h .
b•• t·pr.,tku
o A .omp.,/so. with .,iIf bIll' o Comp.rilOn wlh .In 'Iv.rag.·.

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'.rg.t lOT th. 0"11 improv.m."f 01 Ih. cU"'/lI .'tfe, comp.ri.on
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tor th. OW/I impronm.nt p'0' . . '
o Pro"",. lIud 10 .tM.v.
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o OiHicllltM' !inding camp.tabl. p...ibl. with th. b,,'-ma,.hlllg
tomp.,.;,. comp.ny illt,tvi.w.d, lIot witlt
Iha ·virtu.l· comp"'y
o S ••• ibility 01 d.t. to b. u.lt.ng.d
Figure 4 Benchmarking ,,real" versus benchmarking "virtual" companies
The data base does not only contain average "virtual" companies but also
"virtual" best-in-class data: the benchmarks (Figure 5). These benchmarks will
also be calculated by taking into account the influential factors: benchmarks from
comparable but not existing companies. It is near to impossible to find areal
company being able to fit all the influential factors. The virtual best-in-class
company is a combination of the best processes of all companies that participated
in the survey. The data base is constantly updated with new data.
•:' Th. h...by

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o maxlmum/
mInimum company
Figure 5 The data base

Instead of comparing average companies as it was done so often in the past, it

is now possible to realize comparisons with best-in-class companies immediately
and see which level of excellence they are able to achieve. The virtual best
company sets benchmarks. These are realistic and achievable goals for a process
optimization. Goals that can be communicated to every employee and will be
better accepted than a "we have to improve by 30 %" slogan from the top
management.
Virtual benchmarking compares measures and clearly indicates performance
gaps. It does not compare processes as the classical benchmarking does.
2.3 LOG CHECK Concept
The data base and the calculation logic are used to set up the LOGCHECK concept
and to build the software tool LOGCHECK. The LOGCHECK concept is based on
four steps, shown in Figure 6.
o uestion na ire Interview

(in advance) (on site)
o Individual measures
o Tolerance range
o Benchmarks
o Identilication 01 potentials
o Discussion 01 deviation reasons and
possibilities 01 improvement
C FlR /996
Figure 6 The LOGCHECK procedure
The questionnaire will be sent to the company. First step of the concept is to fill
out the questionnaire sent in advance. It does include all the measures as weIl as
it's precise definitions. This is followed by an on-site interview. The on-site
interview has proved as to be very important when discussing the results of the
study. The data are used to calculate intercompany measures and benchmarks.
The starting screen (see Figure 7) shows some of the influential factors
considered for the comparison. The influential factors shown are used to
determine market position and variety of variants.
Figure 7 The LOOCHECK software tool
The results are presented to the company and discussed to identify potentials for
improvements. Each company having its own infIuential factor profile uses its
specific infIuential factors to calculate its individual intercompany measures and
benchmarks (Figure 8). The management receives information on other companies
performance. Tbe expenditure for this comparison is much lower than for a
classical benchmarking study.
r---------------------------------------------------------------------~ •B•••
tooshm.~
toll
lOS
70S
,.----------------------------------__________ -J~"
OFIR 1996
Figure 8 Result of LOOCHECK

3 CONCLUSION
The LOoCHECK concept and the underlying model is a sophisticated and efficient
instrument to obtain information about the performance of business processes in
logistics. The "virtual" benchmarks are directly available and accessible. The
search for partners to learn how weIl they perform is not necessary and the
measures are comparable, since all companies in the database used the same
measure definitions. Another positive aspect is that data about the performance of
competitors in the same industrial sector can be analyzed although all the data are
handled anonymously.
The concept has been successfully applied by various companies. After
identifying the performance gaps, they initiated optimization projects in areas
where the highest potentials for improvement were located.
4 REFERENCES
Abels, H., Anagnostou, E., Brockmann, K.-H. (1994), Wie gut ist Ihre Logistik?,
Verlag TÜV Rheinland, Köln.
Pfohl, H.-C. 1985), Logistik-Systeme, betriebswirtschaftliche Grundlagen,
Springer Verlag, Berlin et al.
Syska, A. (1990), Kennzahlen für die Logistik, Springer Verlag, Berlin et al.
Watson, G. (1993), Benchmarking, Vom Besten Lernen, Verlag Moderne
Industrie, LandsbergILech.
5 BIOGRAPHY
Dr. Volker Hornung received his Dipl.-Ing. degree in mechanical engineering from
Karlsruhe Fridericiana University of Technology, Karlsruhe, Germany in 1981 and
the Dipl.-Wirt. log. degree in industrial engineering from Aachen University of
Technology (RWTH), Aachen, Germany in 1984. After leaving he worked 1984 to
1991 as research engineer and chief engineer in charge of the Institute of Industrial
Engineering and Ergonomics (lAW) of the Aachen University of Technology
(RWTH) he received his Dr.-Ing. degree in 1991. From 1992 to 1996 he was
Managing Director of the Research Institute for Operations Management (FIR) ,
Aachen University of Technology (RWTH).
Prof. Holger Luczak studied mechanical and industrial engineering at Darmstadt

University of Technology, Darmstadt, Germany, where he graduated in 1974 to
Dr.-Ing. From 1977 to 1983 he was working as full professor at Bremen
University, Bremen, Germany. From 1983 to 1992 he was full professor of the
Institute for Ergonomics and Industrial Engineering of Berlin, Berlin, Germany.
Since 1992 he is working as Director and Chair of the Institute of Industrial
Engineering and Ergonomics (IAW) of Aachen University of Technology,

Aachen, Germany and as Scientific Director of the Research Institute for
Operations Management (FIR) at Aachen University ofTechnology.
Marcel Oster received his Dipl.-Ing. degree in mechanical engineering and the
Dipl.-Wirt. lug. degree in industrial engineering from Aachen University of
Technology (RWTH), Aachen, Germany, in 1992 and 1994, respectively. In 1992
he worked as a research trainee at L'Air Liquide, Paris, France. From 1994 to 1995
he was an engineer in the European Pre Order Department with 3M-Germany,
Neuss, Germany. Since 1995 he is working as research engineer for the Research
Institute for Rationalization and Operations Management (FIR), Aachen University
of Technology (RWTH).
14
A benchmarking model for the
customer order flow in semi-processing
industries
I.P. Tatsiopoulos, T. Katsikas and F. Clave
NTU Athens, Mechanical Engineering Dept., 15780 Zograjos, Greece
itat@central.ntua.gr
ELVAL S.A., Greece
GRAlIIAP, University oj Bordeaux
Abstract
The non-ferrous metal industry is representative of the "implosive" industries in
which a very small number ofbulk material varieties is converted into a large number
of product varieties. The main goal of this work is to demonstrate the approach for
benchmarking the critical business process of Customer Order Flow at two pilot user
sites, i.e. ELV AL (GR) and TUBUSMETALL (D) through the development and use
of performance models. The approach used for building the Benchmarking Model
combines three methodologies coming from different science fields, i.e. the systems
analysis field (ECOGRAI performance modelling), the cost accounting field
(Activity Based Costing) and the engineering economics field (productivity-driven
approach).
Keywords
Benchmarking, Performance Modelling.
1 INTRODUCTION
This is an account of work done within the benchmarking part of the Esprit Project
REALMS (Reengineering Application Using Modelling and Simulation). Among
the possible set of processes that represent materiaVinformation flows across the
logistics chain, the Customer Order Flow (Roistadas, 1993) has been chosen in this
project as been the most critical from the pilot users' point of view, in order to be the
subject of business modelling and reengineering.
The Customer Orders Flow considers the logistics chain from the customer's
request to the delivery of the product. It involves and cuts across the Sales, Costing,

A benchmarking model tor semi-processing industries 149
Product Development, Production Planning, Materials Management and Shipping

functions of both Pilot Industrial Users. The two Pilots are absolutely
complementary across the value chain in the specific user sector of semi-processing
of non-ferrous metals (see Table I for their typological attributes). ELV AL (GR) is a
producer and supplier of semi-processed aluminium products, while
TUBUSMETALL (D) is a wholesaler of non-ferrous products and a producer of
components using semi-processed raw materials. For both of them the Customer
Order F10w is of utter importance due to the vast number of product varieties
according to customer requirements.
Table 1. Typological attributes of the industrial pilots
TUBUS
Products to
customers'
Implosion
Industrial Goods
Finish to Order
Job shop
Productionl
Distribution
system
Medium-sized
firm
2 APPROACH
The approach used in the REALMS project for building the Benchmarking Model
combines three methodologies coming from different science fields, i.e. the systems
analysis field (ECOGRAI performance modelling), the cost accounting field
(Activity Based Costing) and the engineering economics field (productivity-driven
approach):
1. As an overall methodology the GIM (GRAl Integrated Methodology,

Doumeingts, 1984) and in particular the ECOGRAI component of GIM (Doumeingts
et al, 1995) is used for building systems of performance indicators associated to the
objectives and decision variables of business processes.
2. The Activity Based Costing (ABC) methodology (Berliner, 1989, Innes &
Mitchell, 1990, Cooper and Kaplan, 1991, Theeuwes and Adriaansen, 1994) is a weIl
known cost accounting approach. The REALMS project included a proposed
framework for using ABC in business process reengineering projects by connecting
to defined cost drivers and overhead allocation to business process modelling
(Tatsiopoulos et al, 1996).
3. The productivity-driven NTUA approach is a short-term profitability-based
modelling approach to evaluate changes in output and in productivity (Cosmetatos,
1996).
In applying the three above methodologies for benchmarking the following basic
steps are needed:
Step 1 compares the business practices used for performing the customer order
flow process and its critical activities by ELVAL and TUBUSMETALL. The
process activities have been previously analysed (REALMS Consortium - WP2,
1996).
Step 2 develops a Performance Model for the selected Business Process. The
performance measurement tool used is the ECOGRAI methodology to define
performance drivers (time, quality, costlproductivity) in relation to the objectives and
the decision variables of the business process.
Step 3 validates the activities of step 1 through collecting performance
measurement data. Those data are based on the benchmarking model of performance
indicators and are collected with the help of the Benchmarking Questionnaires.
2.1. Comparison of business practices
The critical activities of the two pilots are nect described, i.e. of ELVAL (GR), a
producer and supplier of semi-processed aluminium products and TUBUSMETALL
(D), a wholesaler of non-ferrous products and a producer of components using
semi-processed raw materials (Figure 1).
Critical activities 0/ TUBUSMETAU

• What is the right price? To define the lowest permissible price and the earliest
possible delivery date
• To find ways to satisfy the customer request. Important is to keep the customer.
If they cannot produce or trade they outsource manufacturing or trade.
• To know from which Customer Order they earn money and from which they loose
money
• To decide if enough quantity of raw material is available.
• To combine customer orders into production orders. This influences production
costs (e.g. setup cost).
• To minimize scrap through solving the cutting stock problem
• Service center: to produce products that are not in the markeI.
A benchmarking model for semi-processing industries 151
• To outsource special products means to release more capacity for standard

products with lower cost.
The logistics chain
TUBUS
Figure 1. The logistics chain of the two pilot users
Critical activities 01 ELVAL

• What is the right delivery date? Delivery date assignment strategies.
• The least expensive way to produce an alloy
• To allocate raw material. That is to take make or buy decisions for the aluminum
slabs that feed the hot rolling unit. Either to make them in the casting unit or to
buy them from external suppliers.
• Where to stock in the logistics chain? (raw materials, intermediate products, ex-
factory finished products, finished stock in distribution centres near the
customer?
• To process internat packing lists. A "blocking lactor" is measured, i.e. if all the
batches ordered by a customer are ready for shipment. This is similar to the final
assembly problem in discrete manufacturing and serious time losses may occur.
• Detailed cost estimation
Comparison 01 ELVAL and TUBUSMETALL customer order flow processes

A comparison ofthe Customer Order F10w activities in the two companies (Table 1)
has shown that the activity "A2. to manage stock" of TUBUS is incIuded in the
activity "A2. to process the C.O." ofELVAL. The activity "A3. to process the C.O."
of TUBUS incIudes the activity "A3. to produce & pack" of ELVAL. The activity
"A4. to prepare the delivery" ofTUBUS incIudes the activity "to pack". The rest of
differences and sirnilarities is shown in Table 2.
Table 2. Comparison of business processes
ELVAL TUBUSMETALL
Al.To create C.O. Al. To create C.O.
• Existence of blanket • No blanket orders
orders • they cannot produce
If
• If they cannot produce or trade they outsource

they refuse the customer trading or production
request • Price assignment is
• Price assignment is based heavily customer-
on detailed standard cost oriented (need for
estimation Activity Based Costing)
• Importance of the
• Importance of the reliability of delivery
Delivery Lead Time due date, not the lead
assignment strategy time (too short)
• Separate processes in • In Tubusmetall it is
ELVAL "to study the inc1uded in "to
technical feasibility" precise inquiry"
(Engineering design and
tooling of special
products.
A2. To process c.o. A2. To manage stock
A3. To produce & pack A3. To process the C.O.

- Manufacturing centre - Service centre
A4. To prepare the delivery A4. To prepare the

delivery
2.2. Performance model for the selected business process
The performance model inc1udes a system of key indicators:

1. Operational indicators concerning time-based and process quality performance
measurement (ZueIch et al, 1995). For the business process and its critical activities
chosen in this project (customer order flow and delivery date/price assignment
decisions) this translates into indicators having to do with delivery lead times (time-
based) and their deviations (process quality). Another c1ass of quality indicators is
the reliability 0/ cost and price estimations used to respond to customer requests.
2. Cost drivers and their reciprocal cost rates developed using the Activity Based
Costing technique (ABC). The activities of ABC coincide to the activities of the
activity model developed with GIM, thus making easier communication and
integration of the key indicators model (Tatsiopoulos et al, 1996). For the Customer
Order Flow process, the ABC technique leads to a more fair distribution of overhead
costs to customer orders that either require special productslcustomers or small
batch quantities, compared to whatever is considered a standard product or anormal
batch quantity ordered. This perrnits a better assignment of product prices.
3. Productivity-driven indices of the Customer Order Flow process help to evaluate
changes in sales output caused by accepted customer orders and changes in
A benchmarking model Jor semi-processing industries 153
productivity caused by the treatment of those customer orders (e.g. manufacturing or

outsourcing) using a profitability-based modelling approach. Those indices are
based on variable cost calculations, that help to define product profit contributions
and profitable customer orders ,and therefore they are complementary to the ABC
cost drivers that deal with the distribution of fixed costs in pricing decisions (Eil on &
Cosmetatos 1977, Cosmetatos & Eilon 1981, 1983, Cosmetatos in REALMS-WP3
(1996).
3 THE ECOGRAI BENCHMARKING MODEL
The following objectives, decision variables and performance indicators have come
out of the Synthesis Group of ELV AL users.
3.1. Activity Index for the Customer Order Flow Process in EL VAL
AO Customer Order Flow Process

Al To create a customer order (C.O)
All To precise the request
Alll Identification of basic technical information
A12 To study the technical feasibility
A12l To check ifthe specs correspond to a standard product.
A13 To define the price and the delivery date
A13l To define a production date and calculate cost
A132 To check the acceptability ofthe date
A133 To calculate a delivery date and price
A134 To negotiate date and price with the customer
A135 To negotiate date inside the company
A14 To confirm the customer order
A15 To process bl anket orders
A2 To process the C.O. in the production dept.
A2l To release production orders
A22 To produce work sheets
A23 To allocate raw material
A24 To order raw material for the casting unit
A25 To order raw material for the rolling unit
A3 To produce and pack
A4 To manage the delivery
A4l To process internal packing lists
A42 To prepare delivery documents
A43 To prepare the transportation
A44 To deliver ex-factory
3.2. Objectives Index and Coherence Analysis for the ELVAL case
Global objectives of AO ("Customer Order Flow Process")

GO 1: To increase the profitability
G02: To keep (or to lower) the cost and to keep at least the estimated cost
G03: To reduce the delivery time and gain a time-based competitive edge
G04: To deli ver the agreed quality and to maximise the quality level
G05: To deliver the order on time promised and to keep at least the estimated lead
time
Objectives of activity Al ("to create a customer order")

01.1: To fill the the capacity
01.2: To seIl with the highest possible price
01.3: To satisfy the customer requirements in terms of delivery time
01.4: To reduce the time to create the Customer Order (C.O.)
01.5: To have the right estimation in terms of cost & delivery time
01.6: To identify the right customer specifications
01.7: To make the deal
Objectives of activity Al3 ("to define price and delivery date")

01.3.2.1 Not to overload (internal agreement)
01.3.3.1 To calculate the right Deli very Date
01.3.3.2 To calculate the right price
01.3.3.3 To perform the calculation in minimum time
01.3.4.1 To negotiate the difference between the proposals & the negotiated resuIts
on price and Delivery Date
01.3.4.2 To reduce the negotiation time
01.3.5.1 To negotiate the feasibility ofthe production
01.3.5.2 To propose an alternative delivery date
01.3.5.3 To fill the capacity
01.3.5.4 To reduce the negotiation time
Figure 2. Coherence analysis of objectives
Decision Variables of AO (Customer Order Flow)

A benchmarking model Jor semi-processing industries 155
DVl: Customer Order Promising decisions that affect the monetary value
(tumover) and the profitability 0/ the Sales Plan and the Master Production
Schedule (output mix) in three kinds of ways: (a) Increase or decrease
sales/production volume (change in its size only) keeping the product mix and
technical specifications unchanged, (b) Change in the product mix only, (c) Change
in product specifications only (e.g. produce more advanced products).
DV2: Decisions that affect the input mix of production factors (material, labour,
capital, energy) and/or specifications of the inputs (e.g.,to buy slabs tor hot rolling
instead 0/ using the labour and capital 0/ the casting unit).
DV3: Decisions that increase the productivity of some inputs without adversely
affecting the productivity of other inputs (e.g. to accelerate customer order flow
through better production planning & control or to shorten lead times through
elimination 0/ non-value adding activities).
Performance Indicators of AO (Customer Order Flow)

PI1: PID Ratio, where P=(total supply chain lead time) and D = (delivery time
requested by the cuctomers)
PI2: Index on the effect of master plan changes on the sales turnover
PB: Index on the effect of master plan changes on the cost
PI4: Index on the effect of master plan changes on the profit
PIS: Index on the effect of input mix changes on input usage levels
PI6: Index on the effect of input mix changes on the cost
PI7: Index on the effect of input mix changes on the profit
PI8: Value Added Ratio = (Total supply chain value-adding time) - (Total supply
chain lead time)
Table 3. Coherence panel of performance indicators
4 RESULTS ON LEAD TIMES
Here follows the presentation of benchmarking results in the two industrial pilots,
ELVAL and TUBUSMETALL concerning the performance indicators PU (PID
Ratio) and PIS (Value Added Ratio) of global activity AO (Customer Order Flow).
According to the coherence panel of Table 3, these important time-based indicators
have a profound influence on global objectives G05 (PlI and PI8)) and decision
variables DV2 (PlI) and DV3 (PI8).
4.1. Lead time measures
Lead time or throughput time is a measure of the speed to execute an input through a
process into adelivered output and includes all processing, setup, waiting, moving
and storage times. Lead time can be measured in a variety of ways for different
processes. For the overall supply chain lead time of manufacturing products, the
following lead time ratios are particularly suitable.
P:D Ratio. Tbe time extending from the placement of the supply orders through
manufacturing to the delivery offinished product to the customer should be aimed to
be equal or less than the customer's expected delivery lead time.
where P:D Ratio goal <= I
Tbis definition measures a multiple of internal lead time over customer lead time.
Tbe goal of the lead time measure is a value less than one, meaning the production
system can supply product to the customer's order without the need for forecasts or
excess inventory. For companies that produce custom products to customer orders
and therefore quote lead times in weeks or months, the denominator can be modified
to be either the customer-desired delivery lead time or the best industry-competitor
lead time.
Value added ratio. Tbe value-added measure is an indicator of the effectiveness of a

process relative to its potential. Value-added time is the "processing" time where
activities are performed on the product that the customer (if it were known they were
being done) would be willing to pay for. A lot oftime is usually lost quite needlessly,
costing visible amounts of money that contribute no value to the process. Setting
value-added time in relation to available time is often a highly illustrative way of
discovering how time is used in an organization.
where Value-added ratio goal = I
4.2. Benchmarking results
Tbe following tables 4 an 5 show the lead-time benchmarking results of the two
pilots:
Table 4. Results in TUBUSMET ALL
These differences in benchmarking data are explained by the fact that ELVAL is a
vertically integrated make- to- order manufacturing company while
TUBUSMETALL is mainly a trading company servicing customers from semi-
finished stock by adding one or two final production stages.
Table 5. Results in ELVAL
28 28 28
32 32 32
5 CONCLUSIONS
The above results came out from internal benchmarking procedures within the
companies of the REALMS consortium. The next steps in order to put the
benhmarking model in the service of business reengineering are the following:
1. Conduct External Benchmarking based on the performance model developed

and the internal benchmarking studies. Identify examples of best practices,
compare to the existing performance indicators and set targets to be pursued by
the reengineering actions.
2. Evaluate reengineering targets. Those targets set in step 1 are usually expressed
in the form of operational indicators (e.g. lead times, inventory levels, etc.).
Those indicators need to be translated in financial terms, a task which is almost
impossible to be handled by traditional cost accounting systems. Activity based
Costing (ABC) seems to be here the ideal approach to calculate Return On
Investment (ROI) coming from the improvement of such operational indicators.
3. Conduct a simulation study. The simulation tool FEMOS will be used to
evaluate reengineering actions in the two pilots. This tool has been developed by
the REALMS partner IFAB (TU Karlsruhe, Zuelch 1995) and is particularly
suited for evaluating organizational changes. Thus it is hoped that a combination
of apriori and aposteriori evaluation of business process reengineering will be
possible.
6 REFERENCES
Berliner, C. and Brimson, J.A. (Eds.), (1989), Cost Management for Today's
Advanced Manufacturing, The CAM-I Conceptual Design, Harvard Business
School Press.
Cooper, R. and Kaplan, R.S., (1991), Profit Priorities from Activity-Based Costing,
Harvard Business Review, May-June.
Cosmetatos, G., (1996), A Short-Term Profitability based Modelling Approach to
Evaluate Changes in Output and in Productivity, REALMS - WP3.
Cosmetatos, G. and S. Eilon, (1983), Effects of productivity definition and
measurement on Performance evaluation, European Journal of Operational
Research 14, pp. 31-35.
Cosmetatos, G. and Eilon, S., (1981), Analysis ofUnit Cost - A Modelling Approach,
in: Falster,P. and Rolstadas, A., Production Management Systems, IFIP,
North Holland, pp. 167-178.
Doumeingts, G. (1984), Methode GRAl, Methode de Conception des Systemes en
Productique, These d' Etat en Sciences, Universite Bordeaux I.
Doumeingts, G., Clave, F. and Y. Ducq, (1995), ECOGRAI - A Method to Design
and to Implement Performance Measurement Systems for Industrial
Organizations, in: Rolstadas, A. (Ed), Benchmarking - Theory and Practice,

Chapman & Hall, London.
Eilon, S. and G. Cosmetatos, (1977), A Profitability Model for Tactical Planning,
Omega, Vol. 5, No. 6.
Innes, J. and MitchelI, F.,(1990), Activity Based Costing. A Review with Case
Studies, CIMA.
REALMS Consortium, (1996), WP2 - Modelling a Critical Business Process.
Rolstadas, A., (1993), Manufacturing Industry Benchmarking, in: Pappas 1.,
Tatsiopoulos (Eds), Advances in Production Management Systems, North-
Holland.
Tatsiopoulos, I.P., Xerokostas, A.D. and N. Panayiotou, (1996), The Connection of
Activity Based Costing to the GRAl Integrated Mathodology for
Reengineering Purposes, IFlP WG 5.7 Working Conference Proceedings on
Business Modelling, Bordeaux, April.
Theeuwes, J.A. and J.K. Adriaansen, (1994), Towars an integrated accounting
framework for manufacturing improvement, Int. J. Production Economics,
36,85-96.
Zuelch, G., Grobei, Th. and U. Jonsson, (1995), Indicators for the Evaluation of
Organizational Performance, in: Rolstadas, A. (Ed), Benchmarking - Theory
and Practice, Chapman & Hall, London.
7 BIOGRAPHY
ILIAS P. TATSIOPOULOS is an Asst. Professor in Production Management and

Logistics at the Industrial Management and OR Section of the National Technical
University of Athens (NTUA). He is also Vice-Chairman of the Greek Institute for
Production Management (HMA) and a member of the Greek State Committee for
Purchasing. He has been active for several years as a professional production
engineer in both industrial and consulting firms and he served as a Lecturer in
management information systems at the Economic University of Athens. He studied
Mechanical and Industrial Engineering at NTUA (1978) and followed post-graduate
studies at the TH Aachen (Germany) and the University of Lancaster (UK) under a
NATO grant. He holds a PhD (1983) in Operational Research from the University of
Lancaster.
PART FOUR
Integration in Manufacturing and

Decentralized Production
Management
15
MRP-3 Concurrent integration of
planning and scheduling in OKP (one
of a kind production)
Prof Dr. Javier Borda Elejabarrieta c.E.O. of Datalde
Sisteplant, S.A., Professor of Production and Engineering
Management Deusto University, Member of I.F.I.P. WG 5.7.
Parque Tecnol6gico Edificio 10548170 ZAMUDIO Spain
Tel: (34) 44520611 Fax. (34) 4 45212 66
E-mail: datalde@redestb.es
Abstract
The current market practices for most capital equipment manufacturers provide
them with some special difficulties in production management tasks. These are ,
mainly:
I. Design changes during the necessary overlapping of the production process.
2. Some degree of uncertainty with supplier's due dates and quality
specifications accomplishments.
3. Sensibility of changes and other incidences in the current schedules that
operates at the shop floor level.
4. Warnings of a chaotic behaviour in both due-dates and productivity
originated by a delay between the coupling of the re-scheduling of
operations at the shop-floor level and the planning process at the office level.
Advanced technology for facilitating integration, lay the concept of the
MRP-3, a new production management system specially indicated for the
"minibusiness" model of a factory, and which is probably going to give a leap in
the next future to the organisational procedures in discrete manufacturing, and in
particular in OKP (one of a kind production manufacturing).
Keywords
OKP, MRP-3, integration, scheduling, planning, distributed production.

164 Part Four Integration in Manufacturing and Production Management
The reference model is used as an organizational issue leading the way in which a
particular OKP company must interact with the MRP-3 software. Key issues for
that are:
• The planning integration as a part of the Engineering department.
• The "coordination technology" engineer who is going to set and facilitate
information structure along the project.
• Prompt definitions of the FAS (final-assembly-schedule) and BOP (bill of
processes), with assignation of critical materials to each BOP's gantt bar.
1 INTRODUCTION
MRP has been largely used in OKP eventually in conjunction with the PERT-
CPM(1). When done, a common practice is performing the first order BOM
calculation based on the critical path nodes of the PERT, and the second order
BOM is coupled using due date tolerances around the first order calculated ones.
This is mostly a tuned and relatively advanced practice, requiring one way (from
PERT to MRP) software integration. But the inconvenients are the following
ones:
• The PERT (or GANTI-BAR correspondent deployment) is lost as a major way
of communication along the company due to the breaking from "phases" into
"bills of materials
11 •
• The phases planning is the most natural way of communication at the shop
floor level and with the planning-engineering department.
• Plant capacity scheduling and rescheduling are not feeedbacked to the different
PERT-GANTI's even manually because this amounts a lot of work. Obviously
they become rapidly obsolete and uneven for planning purposes.
Could be the MPS's (Master Production Schedule) critical resources analysis of
help? The Master Production Schedule practical application in OKP is concerned
with the product parts that have some possibility of reliable enough resource
consumption data forecasting, and that are also in the critical path of the PERT.
Depending upon the particular product concerned though, these are, normally,
pre-engineered adaptable semi-standard items sometimes produced in anticipation
by some kind of forecast.
Unfortunately, the FAS (final assembly schedule) is let out of the critical
resources analysis, and there we have one inconvenient, because it is an intensive
time-consuming activity.
The other inconvenient is that critical resources analysis is not an scheduling
tool, having no finite capacity and interactive bottle-necks sequenciying
optimisation capabilities.
Then you use it as a planning tool for relative long-term resources allocation,
and this is the correct way to do in a MRP-2 environment; do not ask for more.
Regarding all those issues, the objectives of the paper are:
1. To establish a reference-model for the utilisation of the MRP-3 system for
one to twelve months of lead-time (intermediate lead-times) OKP facility.
2. To make a functional design approach of the MRP-3 in OKP.
MRP-3 concurrent integration ojplanning and scheduling in OKP 165
2 MRP-3;ANEWPARADIGM
A new coming generation of production planning and control systems for OKP
(and also in general) is claimed to contend with four contradictory facts: efficient
(and low) inventory, high productivity of direct and indirect labour, great customer
service and design and production continuously dropping changes (see Figure 1).
What gaps to fulfil? Basically we have three:
a) A simple-integrated and interactive model with the PERT-GANTT, the MPS
(master production schedule), the FAS (final assembly schedule), the MRP
and the SFC (shop-floor-control).
b) A practical-comprehensive scheduling optimization and simulation system as
part of the SFC subsystem. The goals to achieve with it are speed of
calculations, weighted multicriteria optimization and global resources opti-
mization (lead-times, machines and labour).
c) A "full-duplex" filtered interactive communication feedback as the
integration key of the above elements (2).
Consequently, MRP-2 smartest use in OKP is given in Figure 2. The shop floor
feedback adjustments is an important missed issue.
Given that these changes are increasing in frequency and influence, some kind
of link is necessary between the SFC (shop floor control) level and the PERT-
GANTT level, otherwise arising lots of communications, poor inventory
management, confused traceability of materials and a considerable amount of
unnecessary coberture in both safety stocks and safety lead-times.
Obviously, this link will be a filtered feedback, not allowing inconvenient
changes at the PERT-GANTT level to put unnecessary "nervousness" inside the
system.
Figure 1 The contenders

We will see as foIlows that the key for that is a system in which the MRP is a
hidden process, the BOM (bill of materials) being replaced by the BOP (bill of
processes) and the leading actors are a single and reliable PERT-GANTT system
(PROJECTI) at the planning level, and an adequated SOS (scheduler-
optimization-simulation) called SIMPLAN2 at the SFC level.
3 THE REFERENCE MODEL
Figure 3 represents the reference model for OKP (3). The gantt-chart is the weIl
known PROJECT which has embedded CPM (critical-path-method) computation.
A hierarchy of GANTTS is given by the system, thus laying off progressive
detailed bars (phases/tasks) schedule as the core of the interdepartmental
communication and as the basic planning tool. Tbe gantt-chart incorporates the
role assigned to the MPS system in Figure 2.
Periodic feedback
adjuslments
Pre engineered
parts forecasting
Periodic feedback
ad'uslments
The missed link

ToFAS? ? shop f100r control (SFC):
To Scheduler? - PAC (producci6n activity control)
ToMRP? - 1/0 control
To Pert - Gantt?
Figure 2 MRP-2 smart use in OKP: key issues and the "missed link".
I Project is a trademark of Microsoft Group.

2 SIMPLAN is a trademark ofDATALDE, S.A.
MRP-3 concurrent integration ofplanning and scheduling in OKP 167
PROJEcr
DOCUMENfATIONAND
STATUS:
INfEGRATED COMPANY
WIDE HYPERMEDIA INFO
PACK
·Cmtinwuily ~gartt
charts staIUI will> zooms for
leveIs THE PLANNING MASTER FILE
.O\.t of schecUe ..alamti" . BOP" GaRt _clmt bosed

'Crltlcal rmchines woddoad 14-F~----ofT-I Bar I
BOP Assigned to each task
an! sclEWles cOlTflOllition.
BOM Assigned to each operation or task
.Critical Jl1iIIerials stab.&.
• Sp!Cial inoIru:tioIII
~-:;:::::===:::;-I SOS
I -
sysIIm SIMPLAN®
-~""'ticrileriaschedullrf;a1gorilhm job reIeasing
• Easy inIeIfaced access to - JIIIChin, gartts.
'l""ific CAD drawir«" - siJIUation.
Figure 3 MRP-3 simplified reference model in OKP.
A "coordination technology engineer" from the engineering and planning

department is in charge of organising structured project documentation in the
networked database. This is a new organizational role trying to make use of
"information technology" as "coordination technology". Set and audit the
project's structured information along the design and manufacturing process is
his main commitment.
Observe the early definition of the final assembly schedule (FAS), thus
permitting the gantt-charts to be more detailed, precise and time-phased,
synchronising as much as possible the assembly, engineering, fabrication and
purchasing.
This is one of the three keys for putting the gantt-chart as the core of manu-
facturing coordination info system, another one being the planning master file
which is the interface between the planning and the scheduling levels. Here, the
information is arranged as folIows:
a) Maintaining the hierarchy of the gantt-chart, with the bill of phases (BOPH)
and the subordinated bill of tasks (BOT).
b) Defining the bill of operations (BOP) for each task.
c) Defining the List of materials (BOM) for each task or operation, depending
on lead-times and sometimes in convenience.
The third one is the continuously interactive loop that integrates in real time the
planning (GANTT) and scheduling (SOS) levels.
The SOS is based on the product SIMPLAN2, an ORACLE3-based multistage
(from FAS to fabrication) weighted multicriteria very fast heuristic scheduling al-
gorithm, developed for an user's consortium and evaluated by Dr. Browne.
2 SIMPLAN is a trademark ofDATALDE, S.A.

3 ORACLE is a trademark of Oracle Corp.
The system has input restnctlOns and gives detailed operation to operation
machine GANTIS. The weighted criteria are the following:
• Minimise lead-times (a%)

• Minimise machine changeovers (b%)
• Maximise machine occupation (c%)
• Minimise direct labour occupation (d%).
• FIFO/priority (e%)
Being a + b + c + d + e = 100%, and as told, the output of the model is a
typically coloured gantt-chart per operation-machine, ready to do simulation with
it just moving the bars. Eventual deoptimization figures are given in each
simulation trial.
An external filter is necessary to link the real-time feedback from SIMPLAN2 to
PROJECT. Scheduling and planning are integrated in a team composed by the
senior planning staff and minifactories leaders in a two-level structured
organization, using the hypermedia as a real-time information system which
highlights alarms and exceptions. This blows an interactive planning-scheduling
simulation session helped by the MRP-3 system.
The mentioned external filter uses the planning master file to detect which changes
at the SOS level are significative enough to altere the Gantt-bars at the planning
level.
This is done in a very simple way by comparison of the bar-due dates significative
changes. Not any more sophisticated tool is needed, given that the SOS performs a
finite capacity optimization model taking into account detailed operations
schedules with their correspondent queue compression factors, overlapping and so
on.
4 OTHER FUNCTIONAL ASPECTS
Software integration of the reference model is always a quite difficult issue. Let
us examine the different aspects separately.
• FAS definition in the Gantt-chart. This is a simple issue and is easily
introduced in the PROJECT in terms of bill of phases and tasks. The
capabilities of the system to calculate resources consumption and to put them
in terms of graphical information are of great value, helping in the simulation
process at this stage of planning the different final products.
• Materials assignment on gantt-bars. Requires an external file. This is the above
mentioned "planning master file". An SQL4 program updates simultaneously
the gantt-chart and the master-file.
• BOP and associated BOM from the CAD. The smartest way to do that is a
common file BOP-BOM for hoth the CAD and the MRP-3. This is not a major
inconvenient just switching and complementing the procedure of creating BOM
in the CAD side with the BOP, and laying them in the planning master-file.
2 SIMPLAN is a trademark of DATALDE, S.A.

4 SQL Standard Query Lenguaje
MRP-3 concurrent integration ojplanning and scheduling in OKP 169
• Updating the gantt-chart from the SOS system

A very simple interface program is necessary to send the finally filtered
reschedules to the gantt-chart. It is done in terms of changing:
- starting and due dates in the gantt-bars (normal conditions).
- relations and dependencies among phases/tasks (abnormal conditions).
Initial plans can be maintained in the gantt-chart, and displayed in conjunction
with the current ones.
• The hypermedia info pack
An external interface SQL pro gram automatically activated by filtered changes
in the gantt-chart, the planning master file , the SFC status, the purchasing
status and a special "engineering and planning comments section", updates
continuously the proprietary files of an hypermedia e-mail, thus giving a
compact permanently updated "info-pack", which can be specially content-
based (e.g. alarms from the mentioned filtered changes) mail-addressed.
5 MAIN RESULTS AND STATUS
The expecting results with the consistent organisational changes derived from the
use of the MRP-3 are the following:
• Better due-dates accomplishment and faster reaction upon schedule unexpected
changes, both given by 20-30% lead-times reduction.
• Preventive actions with customers, suppliers, and the dynamic allocation of
internal resources.
• Significative raising in direct labour productivity and machine utilisation.
Expecting figures are 10% and 20% respectively.
• Significative decay of unexpected and no convenient subcontracting.
• 12-24 man-hours/day saved in administrative production and engineering tasks
for an SME ranging from 100-250 people.
Finally, and looking at the status, a MRP-3 prototype is being built by the R+D
department of Datalde, S.A. based on their own product called SIMPLAN, an
advanced multistage multicriteria shop floor scheduler simulator, in conjunction
with PROJECT. The SIMPLAN has been sold in seven capital-equipment com-
panies along half year, as an SFC help in an MRP-2 environment. Next step is to
try the MRP-3 model in these seven companies.
6 CONCLUSIONS
MRP-2 application in OKP is not appropriated given the poor use of both the
Gantt-charts and the BOP. In the other hand, finite capacity scheduling is
eventually performed as a complement for adjusting MRP calculations with the
shop-floor reality, and thus the MPS has not always a clearly defined role.
This way, the organization is privated of a very intuitive and potentially precise
procedure of planning and scheduling communication in OKP; the gantt-chart.
Two sense feedback, linked by agile software, of the levels of planning (by gantt-
charts) and scheduling (by a SOS system) in conjunction with an hypermedia info-
pack user interface, is promising to become the OKP production and planning
system of the future, given that this software model can be a single-comprehensive
one when dealing with the convenient BOP instead the currently used BOM.
7 REFERENCES
(1) Morteusen, Johansen. (1993), A new conceptfor managing OKP. IFIP WG 5.7
Seattle Conference on Concurrent Manufacturing. (R)
(2) Harrison, Mike. (1994), Finite capacity moves to the heart of MRP-2. IFIP WG
5.7 Seattle Conference on Concurrent Manufacturing. (R)
(3) Heurk, Hans (1995), When does the MRP-3 appear to close the gap between
materials and capacity planning? IFIP WG 5.7 Seattle Conference on
Concurrent Manufacturing.
8 BIOGRAPHY
Prof. Dr. Javier Borda Elejabarrieta has been working as plant Engineer and
Production Manager staff for 7 years, and from 1984 he is the managing director
and C.E.O. of DATALDE, S.A., a Spanish 35 people industrial engineering
company, sited in the Basque Country. He read in 1989 the Doctoral Mechanical
Engineering dissertation on "CIM for plastic injection workshops". He is also
Professor of Production and Engineering Management in the University of Deusto,
Bilbao, and the author of several international papers and a book titled: "Advanced
Maintenance Techniques" (1990). He has become recently an IFIP WG 5.7
member.
16
Analysis and design of production and
control structures
M.J. Verweij and A.J.R. Zwegers

Department ofTechnology Management
Eindhoven University ofTechnology, Pav. U21
P.O. Box 513,5600 MB Eindhoven, the Netherlands
Tel: +31-40-2472444 Fax: +31-40-2451275
Email: mvw@tm.tue.nl
Abstract
The objective of this paper is to illustrate the relationship between production
structure and control structure. Identified production basic types (PBTs) and
control basic types (CBTs) are used, that allow one to quickly analyse existing
structures, and to develop alternatives. Features such as product variety, and
(variations in) production volume provide the link between individual PBTs and
CBTs as weIl as the link between configurations of the basic types. (Configurations
of the) production and control modules are redesigned in an integral approach. The
basic types visualise the effects of applying different design strategies.
Keywords
Production Management, Production Redesign, Control Structure, Design
Strategies.
1 INTRODUCTION
Enterprises face internal modifications to cope with severe competition in the

global marketplace. In order to survive at the global market, efficient and flexible
operation is essential. Therefore, enterprises are obliged to adapt their production
systems and control systems according to the extern al demands. However, because
the systems change frequently, discrepancies might occur between a production
Advances in Production Management Systems N. Okino. H. Tarnura & S. Fujii (Eds.)

system and its accompanying control system. In course of time, the production
system and the control system do not 'match' anymore.
The objective of this paper is to illustrate the relationship between production
structure and control structure. We focus on companies that are characterised by
small batch manufacturing. We use a number of identified production basic types
and control basic types. The use of basic types allows one to quickly analyse
existing structures, and to develop alternatives. In addition, we explain the effects
of design strategies upon production and control structures. We take the design
strategies as distinguished by Galbraith (1973) as starting point. In this paper, we
argue that companies should take production, control (and information) aspects
into account together, and not sequentially. The results are obtained by literature
study, and by practical experiences with the basic types in industrial applications
(Verweij, et al., 1995).
We have found some relations between production structure and control
structure. For example, the most suitable control type for a manufacturing cell is
the heterarchical structure. In addition, it appeared that the basic types provide
good means to demonstrate the effects of some design strategies. The application
of the design strategies in practice implies that both the production and the control
structure will be affected. Changing from one production basic type to another
mostly leads to changing the control basic type as weil, and vice versa.
2 PRODUCTION BASIC TYPES AND CONTROL BASIC TYPES
2.1 Production Basic Types
The Production Description Language (PDL) is a tool to describe, analyse, and

redesign production organisations. The PDL describes an organisation by
analysing the structure of the organisation's production processes and supporting
processes. These processes consist of a number of mutual dependent activities that
are grouped into modules. A production organisation can be constructed by
combining a number of production and supporting modules.
The PDL contains descriptions of a number of basic types for production
modules: the Production Basic Types (PBTs). The PBTs provide an overview of
the possibilities to structure the production processes. They are not meant to
classify production structures but to typify them, to identify relevant dimensions
for a design of a production structure, and to indicate extreme values for these
dimensions. Figure 1 presents the six PBTs that have been elaborated (Verweij, et
al. , 1995; Verweij, 1995).
Analysis and design ofproduction and control structures 173
•
Functional departments Manufacturing cell Flexible Manufacturing System
~~,~, •
• • ••• ~
~
• •
Multi-productline Flow dock Dock
~ Work Station • Operator
Figure 1 Production Basic Types
Each Basic Type has certain advantages and disadvantages that influence the
performance in certain situations. The performance can be measured by the costs,
the throughput times and the quality of the realisation of the required production
programme. Different characteristics of the production programme such as product
variety and complexity will lead to different choices of Basic Types or
configurations of Basic Types. The PBTs can be mutually compared on their
relative performance in relation to characteristics of the production programme. In
this way, a suitability profile is created of the situations in which the Basic Types
realise a better or worse performance. These suitability profiles have been
presented in (Verweij, 1995).
Functional department
In a functional department, the work stations are connected in a parallel way, and
they are not specialised. The products follow variable routings, only passing one of
the work stations in the department. On each work station, one task is executed.
Every work station is operated by one operator; possibilities exist to operate a few
work stations at the same time. All supporting processes are separated from the
production process. Raw materials, products and too1s are distributed to the
department from a central point. Quality assurance and process planning have been
centralised as weIl. FinaIly, coordination takes place from a central point also.
Manufacturing cell
A manufacturing cell consists of a number of serially connected work stations. The
products follow a fixed routing between the work stations. On every work station
one task is executed; the work stations have been specialised for a specific group
of products. Supporting processes such as storage, internal transport, quality
assurance, tool management, and process planning are executed in the cell.
Coordination between the work stations is executed in the cell as weIl.
Flexible Manufacturing System (FMS)

In a Flexible Manufacturing System (FMS), the work stations are serially
connected by an automated materials handling system. This system also serves as a
buffer between the work stations in which products may be stored. The routing of
the products between the work stations is variable. Tool management has been
automated as weIl. Process planning is executed outside the FMS in a central
department. Coordination of the activities and quality assurance take place
internally in the department.
Multi-product fine
A multi-product li ne consists of a number of serially connected work stations with
small buffers between them (or without buffers). The products follow a fixed
routing between the work stations. On every work station, one task is executed.
The output per time period is equal for every work station. The work stations are
specialised for the required production programme. Storage of parts takes place in
the department. The other supporting processes (process planning, quality
assurance, transport of parts and finished products, tool management) are executed
in other departments separated from the production. Coordination of the activities
takes place centrally .
Flow dock
In a flow dock, a number of work stations are connected serially. The products
follow a fixed routing. On each work station, a number of tasks are executed
simultaneously on one product. The work stations are specialised for a certain
group of products. The average output per time period of each work station has to
be equal but the amount of work may vary by varying the number of parallel tasks.
Storage, transport, tool management, process planning and quality assurance take
place in the module. The flow dock is coordinated from a central point.
Dock
A dock consists of one integrated work station in which all activities are executed.
These activities are coordinated in the dock. The dock is responsible for the output.
Process planning takes place centrally . All other supporting processes take place in
the module.
2.2 Control Basic Types
In addition to the Production Basic Types, three Control Basic Types (CBTs) have
been identified. They are based on the work by Dilts, et al., (1991) on the
evolution of control architectures and are represented in Figure 2. Note that unlike
in (Dilts, et al., 1991), circles represent control entities, whereas production
modules are portrayed as rectangles. Control entities might be information systems
as weil as human beings.
Proper Hierarchical Control

In a proper hierarchical control system, a specific controller dictates all activities
of the subordinate (slave) level. The subordinates - whether they are production
modules or lower level controllers - are not allowed to refuse the commands from
the upper level controller. Control decisions are operated downwards, with status
reporting operating upwards. Aggregate decisions are made at the highest levels.
These decisions are filtered down and more detail is added as they pass through to
the lower levels. Detail of information increases with each lower control level,
whereas the time period for its consideration decreases.
A configuration of hierarchical controllers is characterised by a philosophy of
'control levels' and contains several control modules arranged in a pyramidal
structure. Each level has its own purpose and function. At the top of the hierarchy
is a single controller which is responsible for setting global goals and formulating
long-range strategies that commit the entire hierarchical structure to coordinated
actions which would result in achievement of the selected goals.
Modified Hierarchical Control

Just like in the previous Control Basic Type, in a modified hierarchical control
system, controllers assurne established supervisor/subordinate relationships with
lower/upper level controllers. However, the main distinction between the two basic
proper hlerarehlcal modlfied hlararchlea' heler.rehleat

control control control
Figure 2 Control Basic Types

176 Part Four Integration in Manufacturing anti Production Management
types lies in the degree of autonomy; modified hierarchical controllers are

equipped with some amount of self-sufficiency (or autonomy) with respect to
higher level controllers. This relative autonomy loosens the master/slave
relationships between controllers; a controller acts as an intelligent assistant to the
host and not as a slave. At the same hierarchicallevel, some degree of coordination
among controllers is required to carry out a sequence of activities initiated by a
command from a supervising controller.
Heterarchical Control
In a heterarchical control system, locally distributed, autonomous controllers
communicate with each other without the master/slave relationship. Full local
autonomy and a cooperative approach to decision making are the main features.
Supervisory decision making is located locally at the point of information
gathering rather than in a central location.
Cooperation between controllers is usually arranged via a negotiation procedure.
The most important characteristic of a cooperative protocol is that it allows any
module to refuse the transfer or acceptance of a message based on its own
knowledge of its own status. These characteristics are necessary to ensure that full
local autonomy is maintained during the cooperative process. By using a
negotiation-based protocol for cooperation, controllers negotiate with each other to
arrange operations such as scheduling and routing of work parts.
Suitability 0/ the Control Basic Types

Like the PBTs, the CBTs also have certain advantages and disadvantages that
influence their performance in certain situations. This performance depends on
dimensions such as uncertainty, product variety, and production volume.
Galbraith (1973) defines uncertainty as the difference between the amount of
information required to perform a task and the amount of information already
possessed by the organisation. The amount of information needed to perform a
task is dependent among others on the diversity of the outputs provided.
Uncertainty occurs in the future demand concerning time, size and specifications
of the products to be produced. In addition, the number of different input resources
such as the required materials and capacity utilised plays a role. Finally, the
amount of information required to perform a task depends on the level of goal
difficulty or performance, as uncertainty might appear about the progress during
execution of the production process (Rijn, 1985).
Heterarchical control systems, especially those equipped with negotiation
capabilities, such as agent based systems, are claimed to be suitable for coping
with uncertainty in product specifications, i.e. product variety. The self-organising
way with wh ich the manufacturing system structures itself should allow an
unlimited routing flexibility between production modules. Evidently, routing
flexibility is directly connected to the capacity of dealing with product variety.
Thanks to the negotiation mechanism, and provided the production modules
required for a certain product are actually present in the system, apart should
always be able to 'find its way' through the plant in search of production machines
able to manufacture it (Cantamessa, 1995).
Concerning production volumes, heterarchical control systems are usually
introduced in view of large manufacturing systems and considerable praduction
volumes. In systems with many machines working with high volumes made up of
smaJl batches, mathematical programming-based methods for praduction
management suffer because of computational complexity. In such cases, the
negotiation capabilities of heterarchical control systems might therefore have a
good chance of proving themselves to be superior. On the other hand, with smaJl
scale production and large praduct variety, traditional, hierarchical scheduling
methods are normaJly proposed; in these cases, the superiority of the heterarchical
control systems should carefuJly be verified since there is no apriori evidence that
it should prove to be superior (Cantamessa, 1995).
Hierarchical control systems are preferred when there is little uncertainty. If
uncertainty is low, i.e. there are few fluctuations in product specifications and
production volume, much of the operations can be preplanned. During the actual
execution, little additional knowledge is acquired, and optimal schedules can be
computed before actual operation. Then, hierarchical control systems should be
favoured for an optimal coordination of production modules.
3 RELATIONS BETWEEN PBTS AND CBTS
A discussion on the relation between Production Basic Types and Contral Basic
Types affects two kinds of relationships: control employed within a production
module, and control employed in a configuration of production modules, i.e. the
coordination between production modules.
Discussing the contral employed within a production module, it can be argued
that there is a link between the choice for a control structure and for individual
PBTs. The design of a control structure mainly depends on characteristics such as
uncertainty, product variety, and (variations in) production volume. The choice for
a specific PBT depends on characteristics such as quantity, variety, organisational
and physical complexity, and fluctuations in product mix and production volume.
So, features such as product variety, and (variations in) production volume provide
the link between individual PBTs and CBTs. This link can be visualised by the
combination of a Production Basic Type and a Control Basic Type. That is, inside
a certain PBT a specific basic control type can be employed. The descriptions of
the PBTs in section 2.1 illustrate that one CBT is more appropriate for a certain
PBT than others. Table 1 depicts the most suitable Control Basic Types for the six
Production Basic Types.
Table 1 Relationships between Production Basic Types and Control Basic Types
Func- Manu- Flexible Multi- Flow Dock

tional Jacturing Manu- Product Dock
Depart- Cell Jacturing Line
ment System
X X
Proper
Hierarchical
Control
X X
Modified
Hierarchical
Control
X X
Heterarchical
Control
Also decisions must be made upon the control and coordination between
configurations of production modules. A configuration of production modules can
consist of a number of production modules of the same PBTs, but might consist of
a number of different PBTs as weil. We argue that the relation between a
configuration of PBTs and its control structure is not as strong as the link between
a PBT and the internal PBT control structure. For example, the next section
illustrates that, if internal changes in functional departments are made, causing it to
transform into another PBT, its internal control structure will change as weil. On
the other hand, a configuration of functional departments might be controlled by a
pyramid of hierarchical controllers in case the production volume is stable and can
be planned weil in advance. The same configuration of functional departments
might be controlled by direct communication between the departments in case
many capacity adaptations are necessary because of fluctuations in the production
volume. Mutual dependency between the production modules might play an
additional role in the choice of the most appropriate control structure in addition to
the already mentioned characteristics such as uncertainty and product variety.
4 DESIGN STRATEGIES AND THEIR CONSEQUENCES
The best way to organise is contingent upon the uncertainty and diversity of the
basic task being performed by an organisational unit (Galbraith, 1973). Following
the chan ging extern al demands, enterprises are obliged to adapt their production
systems and control systems.
Traditional design approaches follow a P-C-I approach in which design of the
production processes (P), the control modules (C), and the information systems (I)
Analysis and design 0/production and control structures 179
ereation ereation of investment In ereation

ofslaek self-contained vertieal of lateral
resourees tasks Information relations
systems
(-) y
(P) (I)
y
(C)
reduee the need for inerease the eapaelty

Information proeessing to proeess information
Figure 3 Galbraith's organisation design strategies
are handled in a sequential way. However, more and more the increasing
frequency of system changes and the increased reciprocity of the three aspects P, C
and I require an integral design approach (Kusters, et a1., 1995).
In addition to rules, hierarchical referral and goal setting, Galbraith has described
four organisational design strategies (Galbraith, 1973). Figure 3 depicts these
design strategies. Obviously, the design strategies focus upon different aspects;
their main points of attention in aredesign process are shown between parentheses.
For example, the creation of lateral relations increases the capacity to process
information by adjusting the control structure, whereas the creation of self-
contained tasks interferes with the production structure. However, the
developments described above require the other aspects to be redesigned and
adjusted as weIl. The PBTs and CBTs can be used to depict these interferences
between the various aspects while applying different design strategies. For each
design strategy, this is illustrated by an example.
4.1 Creation of SIack Resources
An organisation can reduce the number of exceptions that occur by simply

reducing the required level of performance. Slack resources are an additional cost
to the organisation. It implies the establishment of additional production and/or
control modules in the organisation. The basic structure, however, will not be
changed. If, for instance, additional functional departments are created in the
organisation, also additional control modules will have to be created that fit in the
existing control structure.
4.2 Creation of Self-contained Tasks
The creation of self-contained tasks involves the change from the functional task
design to one in wh ich each group has all ihe resources it needs to perform its task.
A production structure based on functional departments or multi-product lines will
be changed into one based on manufacturing cells or Flexible Manufacturing
Systems or into one based on flow docks or docks. Table 1 immediately depicts the
consequences for the internal control structure: proper hierarchical control will
have to be replaced by modified hierarchical control or heterarchical control.
4.3 Investment in Vertical Information Systems
Investments in vertical information systems, such as management information

systems or MRP systems, mainly focus on the information processes in the
organisation. These kinds of investments will increase the capacity of the decision
maker. The information processes are not the prime focus of this paper; no
Information Basic Types have been defined, although this might be possible. In
general, it can be said that investments in vertical information systems will tend an
organisation to create more hierarchical control structures which might evolve to
PBTs like functional departments and multi-product lines.
4.4 Creation of Lateral Relations
The employment of lateral decision processes moves the level of decision making
down to where the information exists rather than bringing it up to the points of
decisions. Though mainly influencing the control structure, this solution also
provides new possibilities to further adapt the production structure. Take a certain
production module that is characterised as a multi-product line with hierarchical
control as an example. When the task uncertainty increases, the organisation might
employ the creation of lateral relations. This way, the control type of the module
chang~s to the modified hierarchical or heterarchical type. Then, it is a small step
to re-organise the li ne into a manufacturing cello
4.5 Designing the production and control structure
The design strategies described by Galbraith either involve the creation of

additional capacity or slack in the existing organisation or a transition to a new
organisation. Each design strategy for such a transition has its prime focus on a
certain aspect, whereas the relationships between PBTs and CBTs indicate the
interferences with the other aspects to be redesigned in an integral way. The
overview of transitions between PBTs depicted in Figure 4 might support the
execution of the described design strategies. The arrows in the picture indicate the
most common transitions from one production basic type to another. Note that a
thick arrow indicates a more frequent transformation than a thin arrow.
Flexible
Manufacturing
System
H
~"U~:,u'i'
Functional Multi-product
Department .. Une
~~
Flow
Dock
Dock
Figure 4 Transitions between PBTs
Using Table 1, the additional changes in the control structure can be derived as
weIl. Production Basic Types on the left and right side will be controlled
hierarchically, while in the middle PBTs more distributed control types are used.
Starting from an existing structure, possible alternatives can be developed and
analysed. For instance, a production structure consisting of functional departments
most frequently is transformed to a structure consisting of manufacturing cells.
Other possibilities are the use of flexible manufacturing systems, muIti-product
Iines or flow docks. The proper hierarchica) contro) structure most)y used in the
functional departments will change into a modified hierarchical or heterarchical
control structure. In addition to a changed control structure within the PBTs, also
the control of the newly built configuration of PBTs/CBTs might be changed due
to the considerations described in section 3. Redesign of the (configuration of the)
production and control modules are executed in an integral approach. However, in
this paper we do not elaborate this aspect further.
5 CONCLUSIONS
To survive at the global market, efficient and flexible operation is essential.

Following the changing external demands, enterprises are obliged to adapt their
production and control structure almost continuously. More and more, integral
design approaches (taking into account production, contro) and information aspects
in a more interactive way) are required to achieve this.
Production basic types and control basic types have been used to illustrate the
relationships between the production structure and the control structure in an
organisation. Also the consequences of various design strategies have been

discussed. The basic types and their mutual relationships provide the possibility to
quickly develop alternative redesigns to analyse changes in both the production
and the control structure so that a well-based decision on a new organisation
concept can be taken.
6 REFERENCES
Cantamessa, M. (1995). A few notes upon Agent-based Modelling of

Manufacturing Systems, in Proceedings of the ClM at Work conference (ed.
J.c. Wortmann), pp. 301-317.
DiIts, D.M., N.P. Boyd, and H.H. Whorms. (1991). The evolution of control
architectures for automated manufacturing systems. Journal 0/ Man ufactu ring
Systems, 10(1), pp. 79-93.
Galbraith, J. (1973). Designing Complex Organizations. Addison-Wesley,
Reading, Massachusetts.
Kusters, RJ., F. van Eijnatten, and H. van Ooijen. (1995). Business Process
Redesign: directions for new research (in Dutch), in Proceedings of NOBO
'95, pp. 13-20.
Rijn, Th.MJ. (1985). Producing by informing - Information requirements for
various production situations (in Dutch). Kluwer.
Verweij, MJ., M.A. Rotzoll, and A. Müller. (1995). Redesign of small batch
manufacturing: Basic Type Modelling, in Proceedings of CIRP '95, pp. 337-
345.
Verweij, MJ. (1995). Describing, Analysing and Designing with the Production
Description Language. Report EUT/BDK/74. Eindhoven University of
Technology.
7 BIOGRAPHY
Maurits Verweij received his M.Sc. degree from the Eindhoven University of
Technology in 1991. Currently, he is preparing his Ph.D. thesis at the same
university and he is employed as a management consultant by Berenschot B.V. in
Utrecht, the Netherlands. Both his research and consultant activities focus on
production management and redesign.
Arian Zwegers received his M.Sc. degree from the Eindhoven University of
Technology in 1993. Currently, he is preparing his Ph.D. thesis at the same
university. For two years, he was involved in the ESPRIT project VOICE 11. His
research interests incIude shop floor control architectures, enterprise reference
architectures, and software architecting.
17
Designing organizational structures
of production systems using a
process-oriented approach
Gert Zülch and Bernd Brinkmeier

ifab - Institute 0/ Human and Industrial Engineering
University 0/ Karlsruhe
Kaiserstrasse 12, D-76128 Karlsruhe, Germany
Tel. +49-721-608-4250 Fax. +49-721-694557
E-mail: bernd.brinkmeier@mach.uni-karlsruhe.de
Abstract
This paper discusses a process-oriented approach for designing organizational
structures of production systems. Based on a suitable characterization of order
related processes on one hand, and the personneion the other hand, organizational
structures with a high performance can be defined. Tbe concept of shaping
process-oriented organizational structures is connected to a simulation-aided
approach in order to evaluate the dynamic behavior of planned production systems
and to perform the planning procedure in a flexible and efficient way. Tbe
dynamic analyses are carried out using the simulation tool FEMOS.
Keywords
Production Management, Process Orientation, Organizational Structures,
Continuous Reorganization, Modeling, Simulation.
1 INTRODUCTION
Currently, radical changes are occuring in many companies in order to fulfill the
trend of increasing demands on three typical company goals, namely cost, quality
and time. Furthermore the acceleration of change of factors that influence the
company is dramatically increasing the complexity. Still prevailing orientation and
© 1998lFIP. Published by Chapman & Hall
formation of the activities along a rigid company departmental structure are

dropped in favor of an alignment towards processes (Figure 1). While doing so, the
processes are regarded beyond their Iimitations of cost centers and departments
under the aspect of the maximum customer benefit and the concentration toward'S
the value added chain (cf. Hanewickel 1994).
'unc:llon....t.nled d.p.rtm.nbll .truclu...
~~
BP:
Business
tomer ~ pI'OC8s.
Figure 1 Comparison of order processing in function- and process-oriented

organizational structures.
In order to increase enterprise performance, especially flow increasing organiza-

tional concepts are discussed. Redesign of departmental structures should incIude
all sections of the order processing, not only in production, but also in pre-
productive sectors like sales, design and operations planning (Erbacher 1993).
Most of the organizational forms that exist in theory and practice aim towards
the features junction and object, through which both organizational basic forms are
determined. This is, on one hand, the functional organization where departmental
structures are only directed through functions, and on the other hand, the divisional
organization in which tasks are arranged according to objects, Le. the products or
services that are produced by the enterprise. Most of the other organizational forms
are between these both extreme basic forms, which can be derived through
variation and/or a combination of the functional and the divisional organization
(Gerlach 1983).
From an organizational point of view, new shaping possibilities are opened
through process-oriented business modeIing (Krcmar and Schwarzer 1994). The
high complexity of these modeling and designing methods force the need for
making tools available to support the problem solution.
In the context of this paper, a methodological base for planning of process-
oriented organizational structures is presented. The method concentrates on the
pre-productive areas in industriaI companies. A general structuring offers starting
Designing organizational structures 0/ production systems 185
points for realization of flow forcing forms, because a company organization along
the processing direction of the order is made possible. The developed concept will
be used afterwards on a specific company model as an example.
2 METHODOLOGY
With the developed concept, a method for the shaping of process-oriented organi-
zational structures will be made available. Based on the knowledge of business
processes and their networks, a concept for the design of organizational structures
will be created. The procedure supports the realization of different company
specific goals.
2.1 Overview of process-oriented structuring
Process-oriented structures can be realized in the following steps:

• Selection: Definition of the problem and selection of necessary processes,
determination of main emphasis of organizational redesign.
• Process analysis: Modeling of process networks.
• Quantification: Completion of processes with operation times and order
quantities.
• Conception: Shaping of organizational structures according to different
structuring strategies, modeling and simulation, evaluation and interpretation of
results, proposition of organizational changes.
• Realization: Support of introduction of organizational measures.
In the initial step, planning constraints should be defined. It has to be settled

which processes are included in the investigation and which products should be
taken into consideration. Additionally, the order spectrum for creating a new
organizational structure must be considered. After defining these constraints, the
process analysis takes place. Doing this, the logical flow of the processes must be
determined and modeled in form of process networks. During modeling, charac-
terization of processes can be realized by assigning attributes to the processes in
question. In the third step, operation times are determined and the process model is
connected with the order spectrum. With this quantification, the capacity require-
ments of the observed period can be taken into consideration.
Based on the characterization of network processes and the personnel abilities,
process-oriented forms of organizational structures like flow-oriented creation of
teams. may be defined. According to the high level of decomposition, it is possible
to come to a more differentiated organizational structure than from a functional
point of view. The fifth step covers installing the planned organizational structure
into the company.
The most important steps of the method and the structuring strategies are
deepend below.
2.2 Modeling of process networks
Starting point for modeling process-oriented organizational structures is the

modeling of business processes (or activities at the most detailed level) of the order
processing.
The modeling of process networks is supported by an object-oriented modeling
technique and a special process library which has been developed by the ifab-
institute of the University of Karlsruhe (Zülch and Fischer 1995). The library
consists of detailed process network elements for the technical processing of
customer orders and is working as a reference model (especially in one-of-a-kind
and small series production in machine industry). The emphasis is laid upon the
pre-productive sectors such as sales, design and operations planning.
During modeling, processes out of the library are characterized by their general
requirements on personnel abilities or technical resources (Figure 2). The defini-
tion of the process requirements is supported by a special characterization in form
of a morphological scheme (Figure 3). The basic set of attributes in the scheme can
be further detailed under company specific constraints.
After the flow of processes is determined, processes are completed by
information about operation times, related orders and the order's customer.
Process networks Characterization of

processes (example)
""'1J;;~ElF1r- _________ Requlrement

..:a:ttrlbutes
Network
attributes
Ofter 0202
O~~1~8~------~
Figure 2 Modeling of processes and process networks.

Feature cha,..c:t.ertatIes
.
OBJECT
1 0RIef Oller Intemal
REFERENCES
SUBJECT eustomer Neutral'"
2 merence the cultomer
REFERENCES
TYPEOF PIaMWIg Executing Inspection
3 TASKS ~
(
PROFILEOF Simple type 0i1ricuIt type CompIex type HighIy compIex
TASKS oftaok of taok of task type oftaok
PROCESSING Short Medium Lang

5
TIMES
TYPEOF New Variant Repeat
6 order
OROERS order order
•
PROOUCT Fewparbl Multipleooml'!""'nt MlltipIe<::Ol11p9ll8nt
7
STRUCTURES product ~";t~.! ~e~~
Figure 3 Characterization of processes.
2.3 Conception phase
Within the conception phase development and modeling of organizational struc-

tures, especially job definition, takes place. This task can be proceeded according
to different structuring strategies when using the process characterization for the
design of organizational structures (Figure 4). The realization of strategies is tested
for the company model, and eventually rejected or further pursued. While doing
this, recursion steps are attached, which either behold a new model creation or
represent a refinement of the existing model. In order to follow mixed structuring
strategies, the succeeded use of different strategies during the recursion steps is
possible; e.g. by using a task-oriented structuring strategy after structuring the
system into order segments.
The determination of organizational units is the second step after job definition.
With the elimination of existing departmental structures, the advantages of
functional integration can be exploited throughout the whole company, if attention
is laid on the complete process chain. New forms of work organization like team-
oriented structures may be designed. The results are changed work contents,
processes, and management structures (according to Keller 1993).
After processing of all the necessary recursion steps a new organizational form is
found. This solution is checked with the help of a simulation tool. The evaluation
of the simulation model is the last step of the conception phase. Measures can be
analyzed and determined regarding the simulation results, which then go into the
realization phase.
Processes Personnel
Figure 4 Allocation of processes to persons.
2.4 Strategies of organizational design
The following structuring strategies are regarded from the process-oriented point
of view. Process-orientation in general is understood as the alignment of forms to
typical customer orders and therefore, along the process chain. The term process-
orientation must be further broadened for the use of this concept. The developed
procedures are based on characteristic information of the processes. The process-
orientation is focused on the process as a basic element for different structuring
strategies. The process attributes are consulted as structuring criteria for the use of
the strategies. For example, if customer-orientation for organization is to be
preferred, personnel must be assigned to certain customers or customer groups.
This assignment occurs through characteristic attributes, for example customer 1
for the attribute subject. Through attribute assignment it can be achieved that this
personnel type is only qualified for processes that are initiated by customer 1. The
different structuring strategies are presented below.
Customer-oriented structuring strategy

In customer-orientation, the organization is aligned towards the production of a
product according to the customer's demand. Such a customer-oriented form of
organization has in general departmental structures consequently moved towards
the process of offer and order completion.
Order-oriented structuring strategy

In customer order related one-of-a-kind and small series production, orders are
seen as complex, dynamic process networks. This complexity of the process net-
work must be considered while designing departmental structures. A comprehen-
sive knowledge of the process networks describing the order processing is a pre-
vailing requirement for this kind of approach. Similar process networks can be
combined to classes based on this approach (cf. Scheer 1994). The distinction
between new, varied and repeated order, for example, may be chosen as a tax-
onomy criteria for different order types and thus for the departmental structure.
Process-oriented structuring strategy

The process-oriented strategy has the goal of optimizing processes along the order
flow (Eversheim et al. 1993). Basis for this optimization is the identification of
processes and knowledge of the relations between processes. Logical relations are
represented in process networks. Structuring takes place along the production flow.
Various processes are combined and assigned to personnel types. Therefore, the
structuring criteria refers to single process networks that each represent an offer or
an order. With this alignment of personnel types towards the process flow,
departmental boundaries within order processing can be evaded, and synergy and
training effects could be used efficiently.
Task-oriented structuring strategy

With this strategy, the company organization aims at repartitioning similar tasks.
This is done from the point of view, that through combination of similar tasks
technical competence and human related productivity are increased (Kottkamp
1993). The repetition of identical tasks leads to certain practices wh ich reflect
themselves in the reduction of processing times. The structuring concentrates in
this concept on the combination of task type and task profile. The personnel is
assigned to the processes according to its ability profiles.
Product-oriented structuring strategies

With product-orientation, a personnel assignment to the different products of a
company is to be reached in order to achieve synergy and training effects. These
effects result from the increase in technical competence and the reduced time of set
up, as weIl as from a training degree origin from repeated execution of the same
task. This is why product-oriented structuring aligns according to the requirements
of products or product groups.
Further structuring strategy

The presented structuring strategies aim mainly towards the flow forcing forms of
organizational design. Deviating from these bases, various strategies for creating
an organization are conceivable. One goal could be, for example, the retention of a
central purchase department. In this case, further procedure of structuring must be

aligned according to this restriction. Combined forms of strategies are also con-
ceivable. It can be advanced by the structuring in several steps, using various
strategies.
The use of strategies does not have to be a single event that ends with design of a
model. On the contrary, it is a continuing process, where achieved results are con-
stantly reviewed and made subject to a permanent control of objectives (cf.
Eversheim et al. 1993). The developed organizational form should be dynamically
checked and verified over and over again. Moreover, the organization must be
constantly adapted to the changing order structure. This dynamism is the special
advantage compared to rigid, functional structures. This is the reason why it is
necessary to plan the dynamism of the process flow (Kottkamp 1993).
3 ANALYSIS OF ORGANIZATIONAL STRUCTURES WITH THE

SIMULATION TOOL FEMOS
The determination of possible effects on productivity of projected changes in the

organization plays a decisive role. In a simulation model, a solution can be
evaluated quickly and easily according to its quantitative effects on dynamic
system behavior. For this reason, simulation programs are already widely used for
the planning of production systems; but in most cases only for solving problems
related to the optimization of equipment and material flow. A special type of
simulation program must be used in order to analyze organizational problems. For
this purpose, satisfactory modeling should take into consideration the connection
between processes, personnei, and organizational units.
The simulation tool FEMOS ~rtigungs- und MQntage-Simulator), has been
developed by the ifab-Institute at the University of Karlsruhe since 1988. It is
usually applied to research and industrial projects. The open concept allows to use
this tool for a wide range of applications. Besides production organization, the
study of order processing through complete production systems, from order arrival
to delivery may be treated (cf. e.g. Zülch, Grobel 1992), and questions about the
suitability of production system control strategies can be evaluated (cf. e.g. Zülch,
Grobel 1993).
FEMOS consists of three modules: a module for modeling the production
system, a simulation module with several possibilities of on-line animation, and an
evaluation module for calculating logistical and economical key data such as lead
time degree, utilization, work in progress and activity costs. The basic structure of
this simulation tool is a general description of a production system with required
elements and relations. All processes within a production system are usually
deposed in process networks. Ouring the simulation, the processing of orders,
represented by networks, is performed by personnel of interlocked organizational
units. A production system is modeled by the following basic elements (cf. Zülch,
Brinkmeier 1995): persons with abilities to perform a set of processes or activities
Designing organizational structures of production systems 191
and competences for a set of work places; working hours; work places with
feasibility for a set of processes; material and inventory; processes with manual
and machine operation times; process networks, and orders with due dates.
FEMOS regards the order processing within a production system as a flow of
orders, that consist of different process networks. These networks may be modeled
graphically, thus defining sequences and parallel activities.
The simulation itself is mimicking processing, initiated by the arriving orders.
This is dominated by competition of orders on limited production resources. Every
activity of an order demands resources, such as work places and/or persons, which
are able to fulfill this specific activity. These relations are the aspects of the
organizational structure of a production system. During the simulation run certain
event flows can be animated, such as Gantt-charts of order arrival, waiting queues
in front of a work place or throughput-diagrams (cf. Wiendahl, Gläßner 1993),
showing work contents of incoming and processed orders.
The dynamic performance of the system is influenced by the form of the
organizational structure. The experience of various simulation studies shows, that
the dynamic analysis of a planned production system with a simulation tool is an
appropriate measure to investigate dynamic characteristics of planning solutions.
benefits and shortcomings can be detected and quantified before realization of
organizational changes.
4 CASESTUDY
The concept of shaping production management in a process-oriented way has

been designed and tested with the help of a representative example, located in the
area of mechanical engineering. Supported by the simulation tool FEMOS it is
shown that the definition of process-oriented organizational structures is useful to
increase the performance of this production system.
In this case study, a manufacturer of gear components is investigated and the
focus is put on pre-productive sections of the company, such as the sales, design,
and operations planning departments. The initial situation can be described as a
traditionally organized company with a function-oriented departmental structure.
The orders are processed in the sales department with 13 employees, the design
department with 20 employees, the operations planning department with 6
employees and the calculation department with 3 employees. The load of the 42
employees is composed of an average annual quantity of 1360 offers and orders.
The result of the process analysis revealed 1628 processes. These processes must
be allocated to persons during implementation of the organizational structure.
About 82 000 activities have to be performed by employees during the investiga-
tion period. In accordance to the work load, 1360 process networks had to be
modeled. Because of the amount of data and the high number of possibilities for
allocating personnel to these processes, this procedure demands computer assis-
tance. This is why modeling is performed using the modeling module ofFEMOS.
Different strategies and goals have been tried during the development of several
organizational structures. Supported by the methodology described above, the
following variations have been designed and simulated:
• Variant 1 is based on a process-oriented structuring strategy. The jobs are
created according to the predecessor-successor-relations within the process net-
works of customer orders and allocated to one of three different departments,
considering the work-flow through the pre-production sections. No distinction
concerning order processing is made between different customer orders.
• Variant 2 is a combination of process- and order-oriented structuring
strategies. The jobs are created in the same way as in variant 1 but no organiza-
tional aggregation of jobs to departments are planned. Instead, the spectrum of
customer orders is divided into three different classes according to the
complexity of their process networks and are allocated to a specific segment.
• Variant 3 again is a combination of process- and order-oriented structuring
strategies. In addition to the order-oriented segments of variant 2 there are two
central departments assumed. The created jobs and the classes of customer
orders are the same as in variant 2, but not all processes of an order are
allocated to the modeled segments. Processes for contacting new customers are
allocated to the first central department, and all processes after confirming an
offer are allocated to the second one.
• Variant 4 follows a task-oriented structuring strategy. The jobs are created
according to the process attribute profile 0/ task. As result of the combination
of tasks with the same profile (simple, difficult, complex, and highly complex),
four different types of jobs can be identified which are allocated to three
different departments. In contrast to variant 1, the departments are designed
without considering the work-flow. The job types, which are based on simple
or difficult tasks, are allocated to two separate departments and the remaining
jobs for complex and highly complex tasks to the third one.
• Variant 5 is a combination of task- and order-oriented structuring strategies.
The jobs are created in the same way as in variant 4 but no organizational
aggregation of jobs into departments are planned. The customer orders are
divided into the same classes as in variant 2, so again three different segments
may be distinguished.
These variants are modeled with the simulation tool FEMOS and examined with
regard to their dynamic behavior. The results of the simulation runs are presented
in Figure 5. The evaluation is demonstrated in comparison to the initial situation. It
can be seen that different strategies lead to widely different results. For example,
the combination of process- and order-oriented structuring strategies of variant 2
show a good lead time. Instead of this, variant 4 follows a task-oriented structuring
strategy which has bad lead times but a high reduction of personnel costs. From the
results of variant 1 it can be seen that a process-oriented structuring strategy could
be a good compromise in order to install a new organizational structure.
Designing organizational structures ofproduction systems 193
Change of degrees of goaI achievement and personnel costs

compared to the initial situation
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%
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Degrees
of goal l1Zl Lead time IIDII Lead time deviation I _ Personnel costs
achi8118ment ~ Utilizalion lIIIIl Wor1< In progress
Figure 5 Results of the simulation study.
With the help of this case study it can be demonstrated, that the methodology
based on a characterization of processes is suitable for designing various organiza-
tional structures. In order to support modeling and to increase acceptance of the
methodology, the next step in the development is the realization of further com-
puter support. For example, the shaping process can be improved by interactive
allocation of processes to personnei, based on a graphical modeling technique.
Another step in the development of the methodology should be the realization
modeling decision structures in order to investigate self-controlled structures, but
then an extension of the simulation tool used here becomes necessary.
5 REFERENCES
Gerlach, J. (1983), Entwicklung von Gestaltungsrichtlinien für eine zentrale Auf-

tragsabwicklung in Produktionsunternehmen. Diss., TH Aachen.
Erbacher, K.-H. (1993), Neue Strukturen im Produktionsbereich. Fortschrittliche
Betriebsführung und lndustrial Engineering, Darmstadt, 1(42), pp. 4-7.
Eversheim, W., Krumm, S. and Heuser, T. (1993), Prozeßorientierte Auftragsab-
wicklung. VDI-Zeitschrift, Düsseldorf, 10(135), pp. 48-51.
Hanewickel, F. (1994), Entwicklung einer Methode zur Bewertung von Geschäfts-
prozessen. VDI-Verlag, Düsseldorf.
Keller, G. (1993), Informationsmanagement in objektorientierten Organisations-
strukturen. Gabler, Wiesbaden.
Kottkamp, E. (1993), Durch strukturierte Vemetzung zu größtmöglicher Kunden-
orientierung. Kompetenz, Frankfurt/M., 21, pp. 4-10.
Krcmar, H. and Schwarzer, B. (1994), Prozeßorientierte Untemehmensmodellie-
rung, in Prozeßorientierte Untemehmensmodellierung, (ed. Scheer, A.-W.),
Gabler, Wiesbaden, pp. 13-34.
Scheer, A.-W. (1994), Editorial, in Prozeßorientierte UnternehmensmodelIierung,

(ed. Scheer, A.-W.), Gabler, Wiesbaden, pp. 1-4.
Wiendahl, H.-P. and Gläßner, J. (1993), A Monitoring System for Decision Sup-
port in Procurement and Materials Management, in Advances in Production
Management Systems, (eds. Pappas, I. A. and Tatsiopoulos, I. P.), North-
Holland, Amsterdam, pp. 107-116.
Zülch, G. and Brinkmeier, B. (1995), Simulation Aided Planning of Work Struc-
tures, in Simulation Games and Learning in Production Management, (ed. J.
O. Riis), Chapman & Hall, London, pp. 91-104.
Zülch, G. and Brinkmeier, B. (1996), Simulation of Activity Costs for the
Reengineering of Production Systems, in Ninth International Working Seminar
on Production Economics, IgIs, Pre-prints, Vol. 3, pp. 229-245.
Zülch, G. and Fischer, A. R. (1995), Library Based Modeling of Process Chains, in
Re-engineering the Enterprise, (eds. Browne, J. and O'Sullivan, D.), Chap-
man & Hall, London, pp. 121-130.
Zülch G. and GrobeI, T. (1992), Simulating the Departmental Organization for
Production to Order, in 'One-of-a-kind' Production: New Approaches, (eds.
Hirsch, B. E. and Thoben, K.-D.), North-Holland, Amsterdam, pp. 177-193.
Zülch, G. and GrobeI, T. (1993), Suitability of Selected Strategies of Production
Control, in Advances in Production Management Systems, (eds. Pappas, I. A.
and Tatsiopoulos, I. P.), North-Holland, Amsterdam, pp. 313-321.
6 BIOGRAPHY
Gert Zülch, born in 1946, studied Mechanical Engineering at the Technical

University of Brunswick, Germany, and Industrial Engineering at the University of
Technology at Aix-Ia-ChapeIle, Germany. After his graduation as a doctor in 1979
and 10 years of experience in research and industry, in 1985 he became head of the
newly founded ifab-Institute of Human and Industrial Engineering at the
University of Karlsruhe, Germany .
Bernd Brinkmeier studied Mechanical Engineering from 1985 to 1989 at the

University of Kaiserslautern and from 1989 to 1992 at the University of Karlsruhe.
He graduated as Dipl.-Ing. in 1992 and is working as research assistant at the ifab-
Institute of Human and Industrial Engineering at the University of Karlsruhe, with
focus on simulation aided planning of organizational structures of production
systems, as weIl as the development and use of simulation aided seminars for
continuing and vocational training in the frame of international projects of the
European Community.
18
Object-oriented representation of
manufacturing systems: State of
the art and perspectives
Anna Bartolotta
Politecnico di Milano
p.zza Leonardo da Vinci 32
20133 Milano, ITALY
Tel. +39-2-2399-2726 Fax: +39-2-2399-2700
E-mail: bartolot@mail.ecopro.polimi.it
Marco Garetti
Politecnico di Milano
p.zza Leonardo da Vinci 32
20133 Milano, ITALY
Tel. +39-2-2399-4760 Fax: +39-2-2399-2700
E-mail: garetti@mail.ecopro.polimi.it
Abstract
The object-oriented representation of manufacturing systems appears to be a
promising way to encompass the limits of more traditional tools that have been
used in the past for the modelling of manufacturing systems. The paper compares
traditional modelling techniques to the approach of object-oriented modelling and
reviews the state of the art of the object-oriented applications developed within the
manufacturing context. As a conclusion, guidelines for the development of a
comprehensive object-oriented representation of manufacturing systems are
outlined.
Keywords
Manufacturing systems engineering, modelling of manufacturing systems, object-
oriented modelling
Advances in Production Management Systems N. Okino. H. Tarnura & S. Fujii (Eds.)
1 INTRODUCTION
Traditional approaches to manufacturing systems design are not weIl suited to deal
with today's dynamic environment where system elements are continuously being
subjected to replacement and rearrangement due to rapid changes in product design
and product mix and fast advances in manufacturing technology.
Today no integrated design framework is available to support the design of
manufacturing systems, a situation that stands in evident contrast to that of the
design of modem manufactured products, where the computer-aided technologies
(CAD/CAM) provide a software integrated environment where to carry out the
design process. This is true in spite of wealth of published researches on tools
supporting specific problems in manufacturing systems design.
This paper is part of a research project aiming to study a Manufacturing Systems
Engineering Workbench (Garetti and Bartolotta, 1995), i.e. a software environment
in which tools supporting the design of manufacturing systems could be integrated
in a common framework.
A corner stone in such kind of approach could be provided by a structured
representation of the domain of manufacturing systems, i.e. a unifying abstraction
enabling the management of all relevant information and knowledge associated
with the process of manufacturing systems design. Upon such a framework, a
comprehensive and consistent manufacturing systems database could be
constructed to integrate all the design tools to be included in the manufacturing
system engineering workbench. This way the designer should deal only with one
central, generalised model of manufacturing systems, while on the other hand all
design tools should operate on this central model.
Once made the one-time effort to insert all data related to a specific manufacturing
system, further advantages could be derived if the database were updated in such a
way as to maintain the exact correspondence and accuracy of the data as the
manufacturing system evolves, supporting the manufacturing engineer in the
redesigning activities.
The objective of this paper is the identification of the guidelines that could be
usefully employed in the ideation of such a representation environment for
manufacturing systems. The objective is addressed by the analysis of existing
modelling methodologies, in particular object-oriented methodologies, and
applications ofthe object-oriented approach to the manufacturing context.
2 REVIEW OF CURRENT MODELLING TOOLS
The traditional methods of systems analysis can be classified as either 'functional

decomposition' oriented or 'data' oriented. In the functional decomposition method,
a system is functionally decomposed using functions and processes as elementary
building blocks: therefore system entities are passive data stores, manipulated by
activities and procedures (see for example the IDEFo approach). The data oriented
Object-oriented representation of manufacturing systems 197
methods, on the other hand, concentrate on system data structure, making

extensive use of data tlow diagrams and entity/relationship concepts.
In the recent few years a third approach, the object-oriented (0-0) approach, both
for systems analysis and design, has been emerging. There is no doubt that the
concepts of 0-0 approach are fundamentally different from traditional structured
methods and require a different way of thinking (Booch, 1994).
As known, the fundamental construct of this approach is the object, wh ich
combines both data structure and behaviour in a single entity. The state of an
object is captured in its attributes, while the behaviour is encapsulated through the
methods (or operations). An object can communicate with other objects through
messages, which constitute its public interface to the other objects.
An object is either a class or an instance of a class. The 0-0 approach embodies
two important concepts:
encapsulation is the separation of the external aspects of an object, which are
accessible to other objects, from the internal details, which are hidden from
other objects;
inheritance allows the reuse of the structure and behaviour of a class in the
definition of new classes.
It is now widely recognised that the object-oriented (0-0) paradigm provides an
excellent approach to manage and express complex systems. The 0-0 approach
presents characteristics that make it particularly suitable to meet the requirements
for the representation of manufacturing systems: in fact, unlike classical
(functional) design, the object-oriented paradigm decomposes a system dealing
with the classes of objects the system manipulates, not the functions the system
performs. Therefore the definition of objects remain independent of the system
functions being mode lied. Only a relatively small number of changes will be
needed as a consequence of the introduction of a new object to an existing system,
in contrast with the functional-based approach, where a large part or even the
whole model may need to be altered to cater for such a change.
Furthermore, it seems that all manufacturing functions can benefit from the object-
oriented approach, thanks to the strong affmity between the manufacturing context
and object-orientation (Nof, 1994). In fact, for each kind of key objectives of a
typical manufacturing enterprise there is a strong analogy in object-orientation; for
example, both focus on objects (parts in manufacturing) and both are based on
methods to define operations and services (processes and manufacturing services).
Finally, the concepts of encapsulation and inheritance provide the object-oriented
approach with characteristics of tlexibility, realistic view, extensibility and
reusability, all characteristics necessary for the representation of manufacturing
systems.
3 REVIEW OF OBJECT-ORIENTED METHODOLOGIES
Unfortunately the interest in the new object-oriented approach, has led to many
methodologies, resulting in a proliferation of definitions, interpretations and non-
standardised concepts; this is particularly evident in the software engineering area,

where the object-oriented approach finds a lot of applications.
The following paragraphs provide a literature review of the 0-0 approach. In
particular, in § 3.1 three of the most known methodologies used in the area of
software engineering will be briefly described, while in § 3.2 some of the few
applications of 0-0 approach already emerged into the manufacturing context will
be critically reviewed.
3.1 Object-oriented methodologies
OOSA (Shlaer and Mellor, 1988) divides systems development into 00 analysis
and design.
00 analysis is described in three steps:
- information modelling: the focus is on abstracting the conceptual entities in the
problem domain in terms of objects and attributes. The associations that exist
between the entities are formalised as relationships that are based on the
policies, rules and physicallaws that prevail in the real world;
- state modelling: this step concerns the behaviour of objects and relationships
over time. State models are used to formalise the life cycles of both objects and
relationships. The state models, wh ich consist of state transition diagrams and
tables, communicate with each other by means of events. State models are
defined by multi-Iayers of state transition diagrams to make the model of
communication orderly and understandable.
- process modelling: the actions of the state models, which contain all required
processing, are dissected into fundamental and reusable processes and are
expressed by an enhanced form of the traditional data flow diagram. The
processes so derived can be converted directly into operations of object-
oriented design.
Four distinct diagrams are used in the design phase:
- class diagram, wh ich shows the extern al view of a single class;
- inheritance diagram, which shows the inheritance relationships between
classes;
- dependency class, which depicts the client-server (invocation) and friend
relationships that hold between classes;
- class structure chart, showing the internal structure of the code of the
operations of the class.
Another 0-0 methodology is due to Booch (Booch, 1994): while designing a

complex system, he views the system itself considering multiple perspectives:
namely, the logical and physical structure, and the static and dynamic semantics.
Both dimensions are necessary to specify the structure and behaviour of an object-
oriented system. For each dimension, Booch defines a number of diagrams,
denoting a view of a system model:
Object-oriented representation ofmanufacturing systems 199
- class diagram, used to show the existence of classes and therr relationships in
the logical design of a system; a single class diagram represents a view of the
class structure of a system;
- object diagram, used to show the existence of objects and therr relationship in
the logical design of a system; a single object diagram is typically used to
represent a scenario;
- module diagram, used to show the allocation of classes and objects to modules
in the physical design of a system: a single module diagram represents a view
ofthe module architecture ofa system;
- process diagram, used to show the allocation of processes to processors in the
physical design of a system: a single process diagram represent a view of the
process architecture of a system;
- state transition diagram, used to show the state space of an instance of a given
class, the events that cause a transition from one state to another, and the
actions that result from a change of state;
- interaction diagram, used to trace the execution of a scenario in the same
context as an object diagram.
The Object Modelling Technique (OMT) (Rumbaugh, 1991) distinguishes among

three kind ofmodels:
- object model, describing the static structure of objects in a system and therr
relationships. The object model consists of object diagrams, a certain kind of
ER models, which describe the association and the relationships among objects;
- dynamic model, describing the interactions among objects in the system and
hence the control aspects of a system. This dynamic part for every class is
described in state diagrams and to identify events, states and transition first
event flow diagrams are drawn;
- functional model, describing the data transformation of a system. This is done
with dataflow diagrams.
The three kinds of models separate a system into orthogonal views that can be
represented and manipulated within a uniform notation. The three different models
are cross-linked (a complete description of a system requires all three models) but
each model can be examined and understood by itselfto a large extent.
None of the existing 0-0 methodologies has really achieved the status of being a
widely recognised standard comparable to some of the conventional
methodologies. Furthermore, the proliferation of methodologies used to refer to
essentially similar and basic functional capabilities leads to be suspicious about the
real necessity of adopting a methodology in order to take advantage of the object-
oriented approach. In addition, when these methodologies (specific to the area of
software engineering) are considered for use within the context of manufacturing
systems analysis, it becomes clear that there are certain features that need to be
catered for (Wu, 1995).
3.2 Object-oriented methodologies
In literature, we can found some attempts to apply the 0-0 approach within the
manufacturing context. A literature review shows that these attempts don't follow
necessarily a precise existing methodology (with its notation and graphical
diagrams), but they use only the basic principles ofthe object-oriented orientation.
This leads to inherent difficulties in formally evaluating these candidate
methodologies on a common basis, because of major differences in their
underlying philosophies and their consideration of only some aspects. In the
following paragraph, a few examples of these attempts will be described and
analysed.
Typically the object-oriented approach to describe manufacturing systems has been

mainly used to build simulation models. The objective is the development of
software modules that can be combined by the designer to build a simulation
model.
Shewchuck and Chang (1991) present a hierarchical structure of object classes,
consisting of three class Iibraries. These classes can be classified into two broad
categories. The first category, to which the base classes and the simulation support
classes belong, contains objects providing the software functions which allow the
background simulation processing tasks, such as time advance, event triggering,
entity creation, list processing, etc. to be performed. The second category, the
manufacturing systems simulation (MSS) classes, includes objects providing the
reusable building blocks for modelling manufacturing systems.
Among the MSS classes, Shewchuck and Chang identify three main classes:
- part object classes, used for modelling parts in the system, can be distinguished
in three classes: partType, opData and part;
- resource object classes, used for modelling resources used in manufacturing
system, can be distinguished in three classes: resourceClass, resourceType and
resource;
- a production system class, used for modelling information which are not
present in other classes, such as the shop calendar, production shift length and
data related to the method by which parts are introduced into the system.
Shewchuck and Chang's work is clearly a research paper aiming at investigating
the potentiality of the object-oriented approach when applied to the simulation of
manufacturing systems: they concentrate only on the most significant classes (such
as machines and parts), ignoring many others (e.g. transport systems).
Notwithstanding this, we can fmd some suggestions in their effort of modelling
this kind of class. In fact their approach seems to gain maximum modularity and
consequently flexibility.
For example, because part process routing data requirements can vary greatly from
one application to another, routing data is not included in part object; instead,
separate routing data objects are used, and part objects contain pointers to these
objects. Through this linkage, part objects know their routing data, while the
physical class separation of routing data from part type data facilitates the
development of different forms of routing data classes for various applications.
The use of a separate operation data object for each part type operation allows
great flexibility in describing part process routings.
Although simulation is the most frequent application field, it's possible to fmd,
especially in recent papers, attempts to generalise this kind of application.
An on-going research project at Oklahoma State University's Centre for Computer
Integrated Manufacturing (Mize, et al., 1992; Pratt, et al., 1991), which aims 'to
develop an object-oriented modelling environment for manufacturing systems', has
been exploring alternative approaches to the modelling and simulation of complex
system. The prototype modelling environment under study should emphasise
reusability and could be used for many specific approaches to systems analysis
(e.g. simulation and queuing). Reusability is achieved through the provision of
separate modelling constructs for physical, information and control decision
elements of a system. In the authors' opinion, designing for reusability involves the
identification ofbehaviours that are useful in more than one context. In general this
implies a system design which adheres rather strictly to the "one component-one
function" doctrine. According to the authors' opinion, the demonstration of the
feasibility of creating logical decision modularity among the decision elements of a
modelIed system is an interesting conclusion derived during the prototype
environment development. This is equivalent to "plug compatible decision
elements", which can be replaced as desired in any location in the model.
Another advantage of the separation of physical, information and control objects is
that it allows the system modeller to think to these elements independently during
the model development. This provides a more natural modelling environment. In
other words he/she needs not to be concerned with information and control aspects
when developing the physical model. The process involving the selection of the
appropriate physical components without being constrained by concerns regarding
how to model information flows.
The papers describing this research project specify neither the object hierarchy nor
the process followed to identify them, but they offer several useful remarks from
which to start for the development ofthe representation environment.
Wu (1995) suggests an object-oriented systems analysis method, called

hierarchical and object-oriented manufacturing systems analysis (HOOMA). This
method exploits the features of two general methods of object-oriented analysis,
OOA (Object-oriented analysis) by Coad and Yourdon and HOOD (Hierarchical
0-0 design) by Graham, and is developed to support specifically the requirements
of systems analysis and defmition within the manufacturing context.
The analysis procedure ofHOOMA can be summarised as folIows:
- system decomposition: HOOMA approaches this task by using 'functional
subjects' (FS), whose hierarchy is identified through function block diagrams
(FBDs);
- identijication 0/classes and objects: the use of sub-system relationship diagram

(SRD), which shows how data flow around a system FS, can provide a useful
aid in tackling this phase;
- specijication 0/ staUc structures: this step requires describing the
manufacturing system in terms of the structures of its class and objects
(generalization-specialization and whole-part relationships), using graphical
presentation ofthese structures similar to that used by OOA;
- specijication 0/ dynamic interaction: it consists in the specification of the
object life cycle using state transition charts (STCs) and modelling of objects'
interaction through activity cycle diagrams (ACDs);
- sub-system integration: the sub-systems are integrated into one whole graphic
model to convey the necessary information about the problem domain.
In author's opinion, the method succeeds in bridging the division between the
function-based approach and the pure 0-0 approach. In addition, HOOMA allows
temporal logic to be encapsulated in the system objects, and hence dynamic
processes can be represented through object interaction.
Wu (1995), unlike the other authors, recognises the need to follow a procedure, a
sequence of steps in order to build a complete model of manufacturing systems,
and proposes a method similar to those used in the area of software engineering.
The procedure he suggests is particularly suited for manufacturing systems
modelling. In our opinion, the use of functional subjects and function block
diagrams in the first phases of the system analysis can address to an inconvenient
decomposition of the domain (more functional than object-oriented) with the
consequence of having a representation not very flexible to changes. The use of
state transition charts and activity cycle diagrams for outlining the interactions
among objects appears to be a good solution, just because both tools have already
been applied successfully to the representation of dynamic interactions in
manufacturing systems.
4 GUIDELINES FOR A COMPREHENSIVE 0-0

REPRESENTAnON OF MANUFACTURING SYSTEMS
The suggestions, highlighted in the precedent sections, can be summarised in a

framework so to provide useful guidelines for the development of what is needed
for an effective use of the 0-0 approach to manufacturing, Le. to create a
comprehensive 0-0 representation environment for manufacturing systems.
- Maximum modularity. In order to obtain maximum flexibility, it's convenient
to modularise, as much as possible, manufacturing information. According to
Shewchuck and Chang's approach, technological data (such as process plans),
for example, shouldn't be included in part object, but they should be considered
as objects apart; in the same way, operations included in a process plan should
be considered as object apart, in order to use the same operation object for
different process plans.
- One component-one function doctrine. In Mize's approach three classes of

objects have been identified, physical, information and control. The one
component-one function doctrine suggests to separate these kinds of objects. In
such a way, the components become building blocks from which a total system
model could be constructed. In fact, if an object performs more than one of the
three basic functions, its use becomes Iimited to situations in which all of its
functions are required.
- Hierarchical structure. The 0-0 approach weil accomplishes the
representation of manufacturing systems related information organised in a
hierarchical manner. For example, the decision making process can be
mode lied through a hierarchy of control levels: shop control level, cell control
level, workstation controllevel and server control level. A hierarchy of objects
corresponding to the controllers of each level can be easily constructed,
exploiting the inheritance property, wh ich allows forming low-Ievel classes
(subclasses) starting from a high-level general class.
- Modelling tools employment. As described, HOOMA procedure consists in a
sequence of steps, using several tools and mechanisms. Following this concept,
a clear procedure composed by steps, more or less supportable by modelling
tools, like activity cycle diagrams or state transition charts, could be an
essential guide for the complete explicitation of each aspect of a manufacturing
system.
Useful suggestions can also be derived from the area of software engineering. In
particular, among the different methods described in section 3.1, it's worthwhile
noting that the Object Modelling Technique by Rumbaugh (1991) shows important
analogies with Mize's objects classes, as highlighted in Table 1.
Table I: Overview of the OMT method and analogies with Mize's object classes
static structure of the

OBJECT objects and their PHYSICAL
MODEL relationships OBJECTS
0 FUNCTIONAL data value INFORMATION

M MODEL transfonnations
within a system OBJECTS
T
aspects of a system
DYNAMIC changing over time CONTROL
MODEL (control aspects) OBJECTS
For these reasons, the OMT method seems to be better suited than other
methodologies (described in section 3) to be applied to the manufacturing domain.
5 CONCLUSIONS
Tools traditionally used for the modelling of manufacturing systems have shown
important drawbacks, such as the limited usefulness of the method, the incomplete
description of the manufacturing system properties, the limited flexibility of the
model. Despite the interest and the results already obtained in modelling the
manufacturing systems thorough the use of the object-oriented approach, a
comprehensive and fully satisfactory methodology has not been reached in this
concem yet.
Further research is therefore needed to fully exploit the potential of 0-0 approach
in the manufacturing field.
6 REFERENCES
Booch, G. (1994) Object-oriented analysis and design - with applications.

Benjamin Cummings, Califomia.
Garetti, M. and Bartolotta, A. (1995) General concepts of a Manufacturing
Systems Engineering workbench as a tool for the re-engineering of
manufacturing systems, in Re-engineering the Enterprise, (eds. 1. Browne
and D. O'Sullivan), Chapman & Hall, London.
Mize, 1.H., Bhuskute, H.C., Pratt, D.B. and Kamath, M. (1992) Modeling of
integrated manufacturing systems using an object-oriented approach. IIE
Transactions, 24(3), 14-26.
Nof, S. Y. (1994) Critiquing the potential of object orientation in manufacturing.
International Journal 0/ Computer Integrated Manu/acturing. 7(1), 3-16.
Pratt, D.B., Farrington P.A., Basnet, C.B., Bhuskute, H.C., Kamath, M., and Mize,
1.H. (1991) A framework for highly reusable simulation modelling:
separating physical, information and control elements. Proceedings 0/ the
24th Annual Simulation Symposium, IEEE Computer Society Press, 245-
261.
Rumbaugh, 1., Blaha, M., Premerlani, W., Frederick, E., and Lorensen, W. (1991)
Object-oriented modelling and design. Prentice-Hall, New-Jersey.
Shewchuk, 1.P., and Chang, T.-C. (1991) An approach to object-oriented discrete-
event simulation of manufacturing systems. Proceedings 0/ the 1991 Winter
Simulation Con/erence, Phoenix, AZ, 302-311.
Shlaer, S. and Mellor SJ. (1988) Object-oriented analysis: modelling the world in
data. Prentice Hall, New Jersey.
Wu, B. (1995) Object-oriented systems analysis and definition of manufacturing
operations, International Journal 0/Production Research, 33(4), 955-974.
Object-oriented representation of manufacturing systems 205
7 BIOGRAPHY
Anna Bartolotta is a Ph.D. student of the Dipartimento di Economia e Produzione

of the Politecnico di Milano. She received a M.Sc. degree in Management and
Industrial Engineering in 1994 at the Politecnico di Milano, presenting a degree
thesis entitled "Framework for a Manufacturing System Engineering Workbench".
Her research interests include advanced tools and techniques for the design and
management of manufacturing systems.
Marco Garetti is Professor of Industrial Technology at the Dipartimento di

Economia e Produzione of the Politecnico di Milano, Italy. From 1971 to 1974,
after graduating in Mechanical Engineering at Politecnico, he worked at Alfa
Romeo first on the mechanical modelIing of a car passenger and on vehicle-body
computer aided design after. In 1974 he joined Politecnico di Milano as a
researcher, working in the field of industrial production, automated production
systems and CIM. He is currently heading an Italian government-supported
research program on integrated production systems. Prof. Garetti is a senior
member of the Computer and Automated Systems Association of the Society of
Mechanical Engineering (CASAISME), a member of IFIP W.G. 5.7, a member of
the editorial board of PIXEL (an Italian review on CAD-CAM) and of the
International Journal of Production Planning and Control.
This work has been developedwithin the PLANTFABERproject, No. 22031, titled
''An integrated software workbench as a tool for the re-engineering of the
Manufacturing Systems Engineering process", in the frame of the ESPRIT IV,
Technologies for Business Processes programme.
19
Autonomy and integration in
decentralized production
E. Scherer
Institute olIndustrial Engineering and Management
Swiss Federal Institute olTechnology (ETH) Zurich
Zürichbergstr. 18, eH 8028 Zurich, SWITZERLAND
es@bwi.bepr.ethz.ch
Abstract
In decentralised production systems with semi-autonomous teams it is necessary to
achieve common and global objectives rather than just local and individual ones.
Still it is necessary to allow the pursuit of local objectives to achieve local
flexibility and thereby ensure a sufficient autonomy. New concepts have to ensure
the possibility of an optimal regulation of local activities within the domain of a
single team while simultaneously synchronising the activities of several teams part
of the same global business activity and ensuring the fulfilment of extemal and
global objectives.
Keywords
Autonomy, decentralisation, self organisation, shop floor management, teams.
THE INDUSTRIAL REALITY
Creation of semi-autonomous work teams is one of the core concepts of a holistic

approach to system design in manufacturing (Scherer et al. 1996). It has been
successfully introduced in various industries and is aimed to provide an increase in
quality and flexibility of work. Autonomy thereby in a first step refers to the
organization of primarily technological tasks, e.g., integration of quality control,
machine set-up, NC program adaptation or minor maintenance tasks. In further
.steps a team takes over the full responsibility of primarily organisational tasks and
Autonomy and integration in decentralized production 207
provides and maintains all or most resources necessary for production within its
domain ofresponsibility.
In the reality of an industrial setting, the newly empowered shop floor level
thereby faces the necessity to achieve objectives provided externally, e.g., through
customer due dates, rush orders or engineering changes, as weH as the necessity to
comply to internal changes caused by machine break down, low quality or similar
interference (Scherer 1995). This results in a tension between the local autonomy
of a team and the objectives provided by central units of the production
management system. In this context centralised, computer-based information
systems like production planning and control systems (PPC) are recognised as an
unwanted control apparatus and effective usage of the information system often is
replaced by the tendency to 'cheat' the system to ensure efficient performance of
the locally controlled machines (Manske 1985,458).
The conflict between global demands and local necessities leads to the creation
of an informal system at operational level. This informal system often provides a
significant contribution towards both, the stability and flexibility of the overall
system (Becker 1985, 87-89). Therefor the informal system is both, a symptom for
the malfunctioning of the formal system as weB as an integral and complimentary
partner of the formal system towards a effective overall system (Emery &
Thorsrud 1976,17).
2 OBJECTIVES
The tensions between local autonomy and global integration lead to an unsolved
dilemma and severe conflicts between an increasingly autonomous shop floor and
higher levels of production management. An integrated, computer-based
information system - originally intended to improve integration in decentralised
production - thereby can further segregation. Studies in German discrete
manufacturing industries indicate, that this inability of teams to cope with central
units of production management - especially the production planning departrnent -
and computer-based information systems often lead to a failure of team-oriented
approaches on shop floor level (see Moldaschl1994, 111ft).
The self-organisational dimension of production systems in industry is often
underestimated in many concepts for production management, and for a long time
was not recognised in primarily IT-relaten approaches which tried to a achieve a
total integration rather than providing individual niches for organisational
development. Therefore it becomes necessary to develop new concepts that allow
both, global integration to achieve a common goal and local autonomy to ensure
local flexibility. This is achieved by the concept of 'coordinated autonomy' (see
Scherer 1996).
3 OPERATIONAL MANAGEMENT AND CONTROL
In the following section a model to describe the operational management and

control of a production system is introduced. The production system consists of a
number of cells. Each cell is part of a distributed system of interacting cells, i.e.,
other units at shop floor level. Therefor each cell can be considered as an semi-
autonomous agent loosely coupled to the other cells of the system. It is one of the
main tasks of each cell to regulate its activities in regard to local and global
objectives. Thereby the cells are linked through information flow as weIl as
material flow. Most cells within a production system are productive cells whose
main task it is to manufacture certain parts or at least to perform a number of
operations. Additional supportive cells provide resources, e.g., NC-programs, or
services, e.g., coordination (Figure I).
buffer butler
Figure I Coordination in decentralised production.
During the regulation of a cell' s operations it is not only necessary to adjust the
local production schedule within the cell in consideration of the local impacts but
to determine the broader influence of the locally changed situation. Therefore the
impact of the interference itself conceming other cells has to be derived - i.e.,
reactive reasoning - as weIl as the consequences of the system regulation
conceming other agents - i.e., proactive reasoning. As long as system regulation
can take place within the domain of the cell and does not affect the global system
no coordination with higher production control levels and neighbouring cells is
necessary.
Still many decisions carried out in such a decentralised system do affect other
cells. In such a case the cells affected have to be consulted first to derive an
optimal solution collectively. Usually it is not possible to achieve an overall
satisfying solution but to negotiate the loosening of previously fixed constraints.
Options for decision-making in a dynamic environment are limited and often not
obvious because of the high level of structural dependencies and the very limited
time period allowed for the decision-making process itself. Therefore local
authority and autonomy is necessary to allow decision-making even with negative

and unwelcome impacts. Thereby it is necessary to ensure autonomy at all levels of
an organisation including personal autonomy of each individual worker at his own
work place.
Figure 2 describes the the levels of management and control for a productive
cell and indicates the principle objective for the control system
level/objective j!roactive control reactive control

eross eell synchronisation of coordination of
:> flow aetivities, determination of interferenee conceming the
optimisation global priorities overall flow and the
sEecifie job
whole eell determination of loeal interferenee management
:> work priorities and coordination of
optimisation consequenees eonceming
the specifie job and the
overall flow
individuall determination ofpersonal trouble shooting and repair
work plaee priorities and processing
:> qualified
work
Figure 2 Levels of management and control of a productive cel\.
A productive cell in the considered case is organised according the principles of
team work. A team can be defined as (Ulich 1994, 174)
• a number ofpersons,
• that interact directly with each other
• during a longer period of time while
• taking over different roles
• based on common rules and
• a team spirit
• pursue a common goal.
Team work has a special impact on the quality and effectiveness of work
organisation since
• a positive experience of work in modem production systems usually is only
possibly if separated subtasks are combined to form a collaborative, holistic
general task within a team, and
• the summation of interdependent subtasks to a collaborative general task
enables a high degree ofselfregulation and social support (Ulich 1991,64).
The tasks perfonned together in a team fonn the core task of acelI, while those
still perfonned separately, e.g., operating machines, are considered single tasks
perfonned by a single individual. Both types, core and single tasks, contribute
towards the fulfilment of the general task of acelI, i.e., the task which for the cell
originally was established (Figure 3).
corelolk
part 01 !he general
!ask perlormed by Ihe
group !ogelher
le.g., sequenc1ng jobs)
Figure 3 Definition of general, core and single tasks of a cell (Gohde & Kötter
1990,68).
4 ORGANIZATIONAL FLEXIBILITY AND HUMAN POTENTIALS
Human resources are a major source of flexibility within a production system (see
Scherer 1996, 59t). Through his intelligence a human can act independently and
creative. A human can provide flexible reactions and adapt his method of working
if the overall system suffers situational disturbances, e.g., in case of urgent orders
or machine breakdown. Human resources therefore are of key value for an
enterprise, not only as bearer of an enterprise's know-how and expertise, but as key
to organisational flexibility.
In the perception of work-psychological research, a task perfonned by an
employee fonns the nucleus of each socio-technical system and links individual
and organisation (see Ulich 1994, 157ft). Hence a task is not primarily perceived
as function or duty to be fulfilled as part of a business process or a technical
system but as a number of activities to be perfonned by an individual. The
individual becomes an acting character and adopts certain objectives to lead his
own action (Scherer & Zölch 1995).
Hence to fully utilise these human features, the structure of the decentralised
system has to fonn a positive and demanding working environment for the human
actor. Task orientation therefore sees the individual human as means of structuring.
This leads to two major requirements towards system design:
• Management and control tasks have to form a significant part of the core task
of each cell.
• Simultaneously it is necessary, to shield the individuals within a cell from the
negative impact on their individual autonomy caused by the activity and
decisions of other cells.
This results in two contradicting requirements. While principally part of the overall
system in certain cases the individuals within a cell need to be decoupled from the
negative impacts of a globally acting and integrated system occurring in a specific
case. This can be achieved through the principles of 'loosely coupled systems' as
proposed by Weick (see Orton & Weick 1990).
5 SYSTEM STRUCTURE AND STRUCTURING
For the design of a management and control system in production the structure of
the system as weIl as the individual tasks represent the basic design parameters.
The structure of a system thereby is condition as weIl as result of the tasks of a
system (Weick 1990, 18, Figure 4).
~esults IL task
In ~
lead
to C activities
fulfill
determines
conditions for
structure
Figure 4 Relation oftask and structure.
According to Figure 4 the structure of a system determines the conditions for the
overall performance of the system. Thereby the autonomy and the coupling of the
cells is defined. True autonomy of a cell has to combine both, autonomy, i.e., to
have the necessary freedom for decision making, as weIl as autarky, i.e., to have
the sufficient command ofresources necessary. Cells are coupled through material
and information flow as weIl as common goals. Internal autonomy of a cell and
external complexity posed by a ceIl's environment are the basic features of a
system determining the effectiveness of the ceIl' s management and control
activities. They can be characterised by. the transparency of a specific decision
making situation, by the possibility and authority of intervention, the capability of
the decision making individual to recognise and understand a specific situation as
weIl as the basic qualification and motivation of the individual.
Ulich (1994, 156) proposes the following requirements towards the structure of
a socio-technical system at cellievel:
• Independent organisational units
If an organisational unit, e.g., a cell, is mostly independent, it is capable to deal
with variation and interference locally without affecting further parts of the
system.
• Interdependent tasks within the organisational unit
Interdependent tasks lead to better understanding of the overall dependencies and
allow communication and cooperation within the cell and between the cell and its
environment. This leads to a common understanding of the overall task and
objectives of the cell and is a basis for building up common knowledge and
experience.
• Unity of product and organisation
If a cell is clearly responsible for a recognisable, measurable and visible product
this allows to measure and improve the performance of the cel!. A certain
achievement can be clearly traced back to the cello
Independence, interdependent tasks, and unity of product and organisation permit

the team of individuals within a cell to gain a clearly stated position of the own cell
within the overall production system.
6 AUTONOMY IN A DYNAMIC SYSTEM
Semi-autonomous teams only can be successful, ifthe general task does not exceed
a certain degree of complexity depending on the level of qualification. If variation
and interference grow so large and complex, that the cell cannot cope with them
any more, shielding the negative impacts is a necessary measure (Susmann 1976).
This is the task of superior coordination, e.g., supportive cells or higher level
management.
A change of autonomy of a cell can result in contradicting effects. On the one
hand, a minimal complexity of external demands is necessary to enforce
improvement of working methods, on the other hand, man is limited in the extend
to which he can proactively control complex processes. Minimising complexity -
as it is still largely suggested among the engineering community - can enhance
system failure, since the missing of challenging tasks results in a decreasing
capability of learning at the operationallevel. Increasing complexity over a certain
bound has the same negative impact (Figure 5).
To ensure lasting effectiveness of a system, a continuos adaptation of the
system in dependence to its environment is necessary. In case of a production
system the major source of continuos adaptation is the adaptation of the system at
cell level. This can result in a change of the overall systems and therefor in an
adaptation of the overall systems in consideration of changing external demands.
Thereby adaptability is a long term requirement while flexibility mainly refers to a
short term adjustment of the systems behaviour rather than its structure. Again the
human individual within the cells are the major initiator and sponsor of a possible
change.
-------------------------- --------
complexity
..
Figure 5 Relation of effectiveness ofwork and complexity ofthe task
environment (Ulich 1974).
By supporting entrepreneurial thinking even at cellievel it is possible to enable
self organisation. A cell pursuing better working conditions and more profit can
enhance a change of both the structure of the system as well as the definition of
tasks to be performed. This change is based on an operational perception of
requirements towards operations management and control. Accordingly the
adaptation of the overall system is based on self organisation at cell level and is
independent from reorganisation as traditionally initiated by the strategic level of
management. Major drivers of such innovation are the possibility of take over
further tasks in an easy system environment and the necessity to adapt in case of
complex requirements (Figure 6). The extend of this independent-adaptive change
can cover the large range from adapting parts of the working methods up to a
change of the global goals of the system.
The complexity of the systems and the resulting conditions for fulfilling a task
is a principle parameter for the definition of the system structure. Complexity
defines the efficiency of human labour as well as the level of pursuit of autonomy
of each cello The complexity of a system whereby is not constant but continuously
changing depending on the structuring process.
posslblllty 01 take over nochaUenge necce.1Iy of adaption

~ External challenges External challenges To comply with the
~ are 50 Iow. that n
are 50 Iow. !hat i5 external requirements it
not necessary to gain i5 neccesary to achive
6 ~x~~~~t~~ted.
1
further knowledge further competence.
ö The cell can take over and competence. Therefor it is necessary
related activities. to further the own
autonomy.
extemal complexitiy
Figure 6 Pursuit of autonomy of a cell in relation to influences from its

environment (Scherer & Dobberstein 1996).
It has to be the objective of an initial system design to ensure and to support
continuos adaptation. Several principles can be applied therefore. Participation
leads to a multipersonal approach of problem solving and helps to transform
employees from being affected to being involved. From the beginning of a
reorganisation project the individual conceives all measures as part of a continuos
process of change and adaptation and will seek to continue so even if the formal
project is completed. An imposed cut back in resource availability will force a cell
into adaptation and self organisation. This strategy can be considered as
'interventionist control' of the systems adaptation and change process (see
Wiendahl & Ahrens 1995,4). Entrepreneurial activity can be supported by a weIl
designed system 0/ incentives as weIl by the introduction of market mechanisms
between the cells. Accordingly the shielding of a cell against variation and
interference has to be limited to single cases but must not hinder a cell from its
pursuit of autonomy. Therefore the extend of shielding in relation to the extend of
external complexity becomes adynamie measure to be controlled by the higher
levels of management within the decentralised production system.
7 INTEGRATION
While autonomy has to be achieved through a strategy of decoupling the ceIls,

integration depends on a certain coupling ofthe cells and coordination ofthe ceIls'
activities. As means to achieve integration the following principles can be helpful:
Autonomy and integration in decentralized productioll 215
• COlumon objectives
Pursuing a goal is the basic principle enabling activity. A specific goal always
depends on the personal interpretation and motivation of an individual (see Scherer
1996, 33ft). The activity of a single cell has to be integrated into the overall system
of objectives of the global production system. This can only be achieved through
motivation and incentives. Therefore it is necessary to allow local and even
personal objectives in addition the objectives proposed by the higher management.
• Integrated information systems
Computer-based information offer various means to integrate distributed and
decentralised organisations. Thereby it has to be considered, that computer-based
systems never will be able to realise a total integration within a socio-technical
system there the human individual still is a major resouree. Rather than globally
imposing activities and procedures they should support loeal activity by
distributing information throughout the system.
• Network organisation and personal communieation
An integrated organisation has to picture the dynamic structure of the system and
the system's environment. This can be achieved through a network organisation of
interlinking teams were each team is part of the respective higher level activities
through a representative. The representative forms an 'interlinking pin' between
the different cells and the different levels of management (Likert 1961). Thereby
the organisational focus is not on hierarchy but on coordination. Therefor a
network organisation is dynamic and adaptable. Figure 7 provides an example.
order processlng
Figure 7 Example of produetion management as system of interacting teams

(Schüpbaeh 1998, based on Likert 1961).
In respect of integration it has to be considered that integration is the ability of an
organisation to flexibly act towards a common goal rather than a specific state of
an organisation of being integrated. Therefore the personal ability to interact and

communicate flexibly and efficiently is a major objective for system design.
8 CONCLUSIONS
System design for management and control in decentralised production has to

consider the high grade of vertical integration - within the management framework
- and horizontal integration - within order processing framework. To ensure
lasting efficiency of a newly realised organisation permanent organisational
development is necessary. Employees have to have the opportunity to reflect their
behaviour and performance as teams and individual and adapt personal goals for
their work. This includes the possibility to question tasks, regulations and
constraints set and change them adequately. The ability to reflect processes and
organisation from the local perspective of the operational level ensures permanent
improvement and flexibility within the process framework for production
management. This forms a kind of enlarged control loop not only controlling the
primary order related performance of the system but given tasks and set objectives.
Within this layout self-design ensures the system's ability to adapt to achanging
situation without changing the overall hierarchical framework.
9 REFERENCES
Becker, R.A. (1985): All factories are not the same. Interfaces, Vol. 15, No. 3, Pp.
85-93.
Emery, F., Thorsrud, E. (1982): Democracy at work. Martinus Nijhoff, Leiden.
Gohde, H.-E., Kötter, W. (1990): Nur Schönheitsfehler oder mehr? Gruppenarbeit
in Fertigungsinseln. Technische Rundschau, Vol. 82, No. 44, pp. 66-69.
Likert, R. (1961): New patterns ofmanagement. McGraw-Hill, New York.
Manske, F. (1985): Fertigungssteuerung im Maschinenbau aus der Sicht von
Untemehmensleitung und Werkstattpersonal, Teil 2. VDI-Z, Vol. 127, No. 12,
pp. 457-462.
Moldaschi, M. (1994): "Die werden zur Hyäne" - Erfahrungen und Belastungen in
neuen Arbeitsformen. In: Moidaschi, M., Schultz-Wild, R. (eds.):
Arbeitsorientierte Rationalisierung: Fertigungsinseln und Gruppenarbeit im
Maschinenbau. Campus, München. pp. 105-149.
Orton, J.D., Weick, K.E. (1990): Loosely coupled systems: a reconceptualization.
Academy ofManagement Review, 11 :2, 203-223.
Scherer, E. (1995): Complexity and reactivity of decision-making in shop floor
control. In: Storch, R.L. (ed.): Managing concurrent manufacturing to improve
Autonomy and integration in decentralized productioll 217
industrial performance. Proceedings ofthe IFIP WG 5.7 Working Conference,

Seattle. pp. 472-483.
Scherer, E. (1996): Koordinierte Autonomie in verteilten, heterogenen
Produktionssystemen. Dissertation, ETH Zürich.
Scherer, E., Zölch, M. (1995): Design of activities in shop floor management. In:
Browne, J., O'Sullivan, D. (eds.): Re-engineering the enterprise. Chapman &
Hall, London. pp. 261-272.
Scherer, E., Dobberstein, M. (1996): Komplexität in der Produktion beherrschen?
10 Management Zeitschrift, Vol. 65,.No. 3, pp. 60-64.
Scherer, E., Schönsieben, P., Ulich, E. (eds.): Werkstattmanagement -
Organisation und Injormationstechnik. vdf, Zürich.
Schüpbach, H. (1998): From Central Planning and Control to Self-Regulation on
the Shop Floor. In: Scherer, E. (ed.): Shop Floor Control - A Systems
Perspective. Springer, Heidelberg (in print).
Susman, G. (1976): Autonomy at work: a socio-technical analysis ojparticipative
management. Praeger, New Y ork.
Ulich, E. (1974): Neue Formen der Arbeitsstrukturierung. FB/IE, Vol. 23, pp. 187-
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Ulich, E. (1991): Gruppenarbeit - arbeitspsychologische Konzepte und Beispiele.
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(CSCW). Teubner, Stuttgart. pp. 57-77.
Ulich, E. (1994): Arbeitspsychologie. 3. Aufl., vdflPoeschel, Zürich/Stuttgart 1994.
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10 BIOGRAPHY
Eric Scherer studied Mechanical and Manufacturing Engineering at the

Universities of Stuttgart and the Aachen University of Technology, both Germany.
After a year as academic visitor at Rutgers University, New Brunswick, NJ, USA,
in 1992 he joined the team of Prof. P. Schönsieben at the Institute for Industrial
Engineering and Management (BWI) of ETH Zurich, Switzerland. He received his
Ph.D. (Dr. sc. techn.) in Industrial Management in 1996. Currently he works for an
European automotive manufacturer and is responsible for the projects in the field
production management systems. His research interests focus on the relation of
organisation and information technology in shop floor control and production
management.
20
Centralized and decentralized control:
Finding the right combination
H. de Haas, J. O. Riis, H-H Hvolby

Aalborg University, Department 0/ Produetion,
Fibigerstraede 16, DK-9220 Aalborg, Denmark,
Tel: +4596358080, Fax: +4598153030,
E-mail: i9hhh@iprod.aue.dk
Abstract
The purpose of this paper is to introduce a more differentiated discussion of
choosing an appropriate combination of centralized and decentralized planning and
control. Based on identification of three main production control tasks,
respectively focusing on customer orders, materials and capacity, we shall
introduce a model to illustrate different decentralization strategies. The model has
been used in industrial companies and stimulated constructive discussions.
To provide a better background for determining an appropriate control strategy
we shall introduce a model with four interacting perspectives, representing major
contextual elements . A case example is introduced and used to illustrate the use of
the two models. Although by far not exhaustive, it is concluded that the two
models have led to a more differentiated discussion of the important issue of
finding an suitable combination of centralized and decentralized production
control.
Keywords
Centralized and decentralized tendencies, Models for control, Case study.
1. INTRODUCTION
In the beginning of 1992 a Danish company introduced a new product and

experienced an explosive growth in sales and production volume which caused the
traditional growth problems, e.g. lack of quality, failing deliveries etc. It was a
daily fight for production to meet promised due dates. Management realized that it

Centralized and decentralized control 219
was necessary to change the traditional way of managing the company. Following,
the company went through a change from a centralized hierarchical structure to a
more decentralized structure where the employees were more involved in the daily
management. The change was based on a Danish Kaizen program (MAPU -
Employee Activated Production Development), (DI 1993). Through this change
the company introduced a number of production groups based on the identified
production tasks. The measurable result of this process was a 12 % increase in
productivity in the first year after the change.
The case is not unique. As a result of a survey of six order producing companies
(Haas and Hvolby, 1995) it was found that changes in the case companies clearly
was areaction to a number of tendencies in the industrial environment. When
asked about their market conditions, all companies replied that the market had
become increasingly turbulent and require customized products and short delivery
times. This tendency imposes a need for more flexible and prompt reactions to
changes. On the other hand, looking into the companies, the technological
development during the past decade has made manufacturing processes more
reliable. At the same time, the development in information technology has made it
possible to collect and exchange almost every desirable type of information.
Combined with the focus on suppliers prompt and accurate delivery, production
control has actually become more deterministic, but increasingly complex.
Despite this change to a more deterministic internal environment, companies are
still struggling with the traditional problems of centralized and decentralized
production control, i.e. lack of coordination, missing information etc. As an
example, the case company mentioned earlier found themselves in the situation
where the central planning department believed that they were in charge of
planning and control. In reality the foreman in each of the production areas was
carrying out the planning and controlling of the production. It resulted in a
suboptimization of production areas, e.g. high level of work in progress, failing
deliveries etc.
As indicated above, the tendencies in production planning and control point in
different directions with respect to centralization and decentralization. This calls
for a more differentiated discussion than often seen in the literature (Mintzberg
1989). It is not a question of either centralized or decentralized control; rather a
question of finding the right combination. Any mode of control in production
holds elements of both centralized and decentralized measures, and the key issue is
to seek an appropriate combination of the two.
We lack models which may support such a differentiated discussion. In this
paper we shall introduce two models; the first one aims at illustrating different
strategies for decentralization of production control. The second model will
provide a contextual setting for evaluating and deciding on a strategy taking the
specific characteristics of an individual industrial enterprise into account. A case
example will be introduced and demonstrate how the two models may be used. In
this way, the paper signifies a step towards a more differentiated view of the
decentralization issue.
2. MODELS OF DECENTRALIZED CONTROL STRATEGIES
Weshall introduce a model which may illustrate the control structure of one
central production control unit and three decentral production units, e.g.
production groups. It rests on the assumption that the control of materials, capacity
and customer orders are the main elements of any control effort. By indicating
where the control of each factor is located, it is possible to depict a spectrum of
different control structures. The letters 0, M and C, respectively stand for the
control of Customer Orders, Materials and Capacity , respectively. A letter in a box
signifies that the pertinent task only sets the frame of control for a lower level.
In the following we shall describe three different examples of the model.
The first model for manufacturing control (figure 1) is the tradition al hierarchical
model where the main decisions are made at the central level, e.g. decisions on
material requirements and purchase, capacity planning and order control. This type
of control appears suitable for a company in an environment with high
determinism and with weIl defined production control tasks at each level of
control.
0 -0
/ 1\C
-M
000
Figure 1 A highly centralized way of control
The second model (figure 2) places the production control task of capacity control
at the decentralized level based on a capacity frame decided at the central control
level. The order and materials control is still handled at the central level. An
example of this model is a Danish shipyard which has divided production into
production areas, i.e. self-controlling groups regarding the capacity control. The
central level handles the long term, overall capacity control and the materials and
order control. This type of production is characterized by large projects with by a
large number of components joint together into one large product. The number of
parts involved makes the material control very complex suggesting that the
control task should be placed at the central level of control. At the same time,
many production groups or departments will be involved in the manufacturing of
the product which suggests that the order control should be placed at the central
level as weIl.
Centralized and decentralized contral 221
Figure 2 Decentralizing capacity control into each production area.
The third model (figure 3) shows a type of manufacturing where the centrallevel
onlyconcentrates on the overall control, i.e. setting frames for the control at the
local level. This model can be found in companies manufacturing standard
products. The type of product for this type of control may consist of a (relatively)
small number of parts wh ich reduces the complexity. The control approach will
also be suitable for Kanban and Just In Time production.
O -[QJ
-IMI
~""
Me
Figure 3 A highly decentralized model of control where central control is focused
on long term decisions, while setting the frames of decentralized control.
Other examples may be illustrated by means of the model, for example a fully
decentralized control with only minor control tasks at the centrallevel.
The rather simple model has been used for depicting the current control structure
in a number of industrial enterprises, and it has served as a basis for a useful
discussion of the present situation as weil as for identifying alternative control
structures, refIecting both external and internal trends. The advantage of the model,
is its simplicity which has made it possible to discuss different control strategies.
Its limitation, of course, is the lack of details and its general nature. Hence, it is
necessary to keep the specific situation of an enterprise in mind in the discussion as
weil as discuss the issue at a more detailed level, before a control structure may be
decided upon in an enterprise.
To provide a better background, we shall propose that four perspectives be taken

into consideration when describing the context in which the issue of combining
centralized and decentralized control measures is embedded.
3. FOUR CONTEXTUAL PERSPECTIVES
The model to be presented in this section aims to provide a basis for determining
an appropriate combination of centralized and decentralized production control
specific for an industrial enterprise. To represent major contextual parameters we
have identified four perspectives, each of wh ich describes an important part of the
entire manufacturing process, cf. figure 4.
Figure 4: Contextual perspectives for determining an appropriate combination of

centralized and decentralized production control.
The four perspectives an influence the production and the way of control. As an
example, it is important to have knowledge of the mix of standard and customer
specific products. The production of standard products can be planned with a
shorter horizon and used as an equalizer for capacity demand. Production of
customer specific products implies large variations in capacity demand and
requires a flexible production. When looking at the four perspectives it is
important to notice that one perspective is influencing the other. This means for
example that the product perspective should be considered when looking at the
process and control perspective. To illustrate, when a case company introduced a
welding robot in the production they forgot to check whether the product would be
suitable for the automated process equipment, and whether the control systems
were prepared for this type of technology, and finally whether the employees
needed further education. This is just one example of the introduction of new
technology. Other examples will show that the same picture may be seen by
introduction of new products.
3.1 Control perspective

The control perspective includes several complex elements. To be able to analyze
the control perspective, a number of elements must be identified, e.g. control con-
cept and control technology. The control perspective is defined as the task of con-
trolling the process of transforming raw material into finished products. The
control concept describes the placement of the pushlpull line, the number of
stocks, the processes and the layout of the production. Other aspects to be analyzed
are the logistics complexity, e.g. if material flow is simple or complex, and the
number of suppliers. Further, the control system used. For example MRP or
Kanban are two different approaches, and they are suitable for different types of
production.
3.2 Organisational perspective

Aspects like organisation al roles, responsibility and the informal organization are
ways to classify the organisational matters. Some aspects to consider are the num-
ber of levels in the production control, the degree of central or decentral control
and thus the question of responsibilities vs. competence. This leads to the decision
processes and the question of how simple or complex the structure need to be
(clear decision hierarchy). Other questions in connection with organisational
matters are the will to change, e.g. management, motivation. This is related to the
culture of the company.
3.3 Product perspective

The product perspective influences the control by the way the products are built,
e.g. the number of parts in the product, the degree of standardization. To determine
the need of control, factors like standard or customer specific products (make to
order or make to stock production) must be taken into consideration. This is
regarded as a key point in the classification of a company control system. Another
aspect to consider is the number of variants. The distinction between a standard
product and a customer specific variant can be a key factor when determining the
type of control. Another area is the complexity of the product. This is found by
investigating the number of parts in the product and the levels in the Bill-Off-
Material (BOM).
3.4 Process perspective

Craft Production and Continuous Flow Manufacturing are two different aspects
indicating the flexibility and complexity of production, e.g. high flexibility to
changes and low volume of products in the direction of One-of-a-Kind production
are typical for craft production. Processes in connection with craft production are
most often less automatized and the capacity control is based on the work force.
The continuous flow environment is characterized by low flexibility to changes

and high volume production. The processes are most often placed in a line layout.
Further it is relevant to investigate whether the production is automated or manual.
The age of the manufacturing technology is attached to the above type of
processes, e.g. welding robots are seen as a new technology in some companies
whereas automatic conveyors are advanced in other companies. Further, it is
important to bear in mi nd the link between the age of the technology and the type
ofprocess.
The following case shows how the model in figure 4 may be used. First we shall
present an analysis of the current situation, then we shall identify areas for
development, and finally propose a new concept for the control in the case
company.
4. DESIGNING DECENTRAL CONTROL - A CASE EXAMPLE
The case company has 70 employees and is part of an international business group.
Today, production planning is carried out by a central planner who has been in the
company for more thari 30 years and is soon to retire. He plans production by
means of a master production plan and ends up with scheduling all machines. The
production management has avision of a self running production with a high
degree of decentralized production control.
4.1 External conditions

Looking at the extern al conditions from an organizational point of view the com-
pany has difficulties in getting sufficient skilled workers. Regarding manufacturing
processes, low cost countries in eastern Europe are now able to buy and manage
advanced manufacturing equipment for use in the same processes. This means
increased competition. Regarding the customers, the tendency is towards smaller
batches with standard components customized to each customer order. Therefore
the company must be more flexible and able to produce finished products eloser to
demand than before.
4.2 The four perspectives and the company

The model with the four perspectives, see figure 4, is used for analyzing the com-
pany with the purpose of identifying the control tasks and their appropriate place-
ment in the organization.
4.2.1 Organizational perspective

The organization is a typical functional organization with sales, finance and
production departments, cf. figure 5. The company has conducted a number of
different development projects ineluding training courses, e.g. in group processes,
conflict solving, psychological work environment and self control.
c5CSCS
Sales
Export
Salas DK
-.... _
. .~
- --;-1 •
.. :. . . . . . ~Ifcontrolling production groups
.. ') . :
. . . . . . . . "-
.- - - Group leader
Figure 5: The formal organizational chart. The operators in production are
organized in four self controlling groups
Some of the typical conflicts appearing in the company are mentioned here. As in
every other company, the operators have different qualifications and preferences
for processes. Some employees want a safe working environment, e.g. a locked
schedule for production, a known machine. Others find it interesting to produce
special orders under more uncertain circumstances e.g. high variety.
4.2.2 Control perspective

Production is partly order initiated and partly stock level initiated. The products are
basically standard but can be customized. This gives a large variation of combina-
tions. In practice the number of combinations is limited for example due to the
construction of the current sales counters. Production layout is functional oriented.
Figure 6 illustrates the control concept.
1'IIIh~ ,~Cbntr~. .. Mlt.t.. fIow.. .. .. .. .. " ~'--_--,
~-~I Cutting I~I Roll ~V

Rnltl1ed
goudl
ln_tor,
Figure 6: The present control concept showing the processes and the push and
pulliine.
The number of rolls is registered every day and statistics prepared so that each
operator can see how much is produced and what the budgeted goal iso Operators
have no possibility to see the connection between daily amount produced and the
monthly overhead wh ich is used for calculating the bonus, mainly because the
variation over a week can be very large. The production control system is from
IBM and of the type MOVEX, a tradition al MRP system.
The production planning procedures are simple and tightly coupled to the
MRP planning. When an order arrives, it is fed into the MRP system and scheduled
for a specific machine.
Every morning a foreman collects the production orders for that day and distrib-
utes thein to the operatores. The production manager makes a master plan with a
horizon of 4 to 6 weeks, which is used for capacity planning, i.e. one to three
shifts, etc. Furthermore a budget plan is made every year mainly for planning dev-
elopment activities in production technology and other investments.
4.2.3 Product perspective

The product is highly customer specific. The customer specific part of the product
is for example the type of print on the roll or the length or width of the paper.
These parameters give a large number of combinations for special products.
4.2.4 Process perspective

All products go through the same process chain which are typical for the branch.
The processes are complex and demand some knowledge to operate. In general the
operators have more knowledge about how to operate the machines than the
production planner. The process flow is simple, i.e. one process is finishing a
product except for the products that need printing. The process equipment in the
production can be divided into two groups. The first group is characterized by
having low set-up times and costs and medium speed. The other group is
characterized by high production speed, high set-up times and costs. This division
implies a division of the products into standard products with high volume, and
special products with low volume.
4.3 Summary of the four perspectives

The company has been described based on the four perspectives, and it has been
shown that the case company has a centralized control structure. In view of the
three different control situations defined earlier, the company may be characterized
as a type one shown in figure 1.
Looking through the perspectives for ways of improvement in this case company
it was found that due to many small orders there are many set-ups in production,
causing much set-up time and costs. The first suggestion would be to divide
production into areas according to the different types of orders.
4.4. The new concept

It is proposed that the performance of the company may be improved through
organizational and control routine changes towards a more decentralized
production control structure. Development of a new structure for production
control will be based on the four perspectives analysis which indicated a possibility
of dividing the production into areas according to the sales volume of the different
product types. Tbe three areas found are showed in figure 7.
Order 11m: 500 < S< 5000 rolls

wlth/wlthout prlnt, ~ecial paper,
special wldth/length
=== > Pul! control
Order 11m: S> 5000 rolls

RIIw material Rnlahed
wllh/wlthout prlnt, &landard/special
- Paper goOO.
paper, &landard/special wldth/length
Inwntory
f---r------v-
- LabaI. ete.
L-_---'
Order 11m: S< 500 rolls
Puah control wllhout label, &landard paper,
v-- === >

&landard wldth/length 91lpplng
'----,------'
i---~V
Intermediate Pul! control
&lock
Figure 7: Tbe new control concept with the division into production areas after
order size and complexity.
In the new concept there will be one production area handling special orders with
low volume and another area for high volume orders. Tbe third area is for standard
products in very low order batches and with a small degree of customization, but
the packing is typically customer specific. Tbe division follows the thougbts of
focused factories by W.Skinner (1978). Tbe organizational structure in the new
system will be based on self-controlling production groups in some areas, and cen-
tral control in other areas, i.e. a differentiated type of control based on the need for
control in eacb area. As an example of tbe decentralization of control, the packing
and sbipping area, will be described in more details.
4.4.1 The packing and shipping area

According to the management, the packing and shipping area should have a very
bigh degree of self-control, and will be apart of the existing finisbed goods stock.
Tbe principle of the system is that a few selected products are placed in large
boxes waiting for tbe last process, i.e. packing and shipping. Wben a customer
orders a product in a batch size that fits this area, the order goes direcdy to tbe area
and into tbe li ne of orders to be packed and shipped. According to calculations
these type of orders can be handled the same day giving a shorter delivery time to
the customer.
Tbe ordering of parts for tbe intermediate stock (cf. figure 7) and tbe packing
area are to be as simple as possible, e.g. Kanban cards. Tbe Kanban order can be
rescheduled, if tbe load of customer orders is too high. To decentralize control the
computer system will be distributed to the different production areas. Tbereby the
production groups are giving tbe possibility for updating order dates, e.g. comple-
tion time, quantity etc. It is planned that the groups should collect their production
orders from the system and also control the capacity.
4.5 Case conclusion

Inspired by the general discussion of how to combine the control levels by the
three models in figure 1 - 3, the case has illustrated the use of the four perspectives
(cf. figure 4) as a frame for analyzing the case company. Through the
interdependencies of the four perspectives some interesting questions were raised,
and special focus was set on the interaction between the product perspective,
control perspective and organizational perspective. Based on the findings a new
way of control is described.
The change in the control structure may be described as a type three as shown in
figure 3, a highly decentralized model for control. This is not absolutely correct
because of the differentiation between the areas in the production. A better
description would be a combination of the very decentralized approach and some
centralized control.
5. CONCLUSION
This paper has aimed at stimulating a more differentiated discussion in industrial

enterprises of choosing an appropriate combination of centralized and
decentralized production planning and control. First, we introduced a rather simple
model to capture the location of the control of respectively customer orders,
materials and capacity , and to delineate the interaction between centralized and
decentralized decisions.
Based on the case example in this paper and other empirical tests, we may con-
clude, that
centralized and decentralized control decisions are two sides of the same coin,
and that it is important to focus attention on the interconnection between
centralized and decentralized control decisions. A combination of centralized
and decentralized control measures should be sought. Although simple, the
model presented in this paper appears to be a useful vehicle for a stimulating
discussion on these issues.
In the second model four perspectives were introduced to describe the context in
which the issue of combining centralized and decentralized control measures is
embedded. As discussed, the product and process perspectives influence the
options available for selecting an appropriate combination, and it is our experience
that often changes in the product program and in production processes are
suggested during the decision making process. Similarly, the case example
demonstrated that the two other perspectives introduced, the organizational and the
control perspectives, are mutually interacting. We have observed that sometimes
the organization has been changed, e.g. to production groups, but the control
structure needs to be adjusted accordingly. And sometimes the opposite is the case.
Based on the case example and other empirical tests we may conclude, that
the four perspectives model may give rise to a fruitful dialogue between com-
plementary factors influencing the choice of an appropriate combination of
centralized and decentralized control. Furthermore, this discussion cannot be
meaningfully carried out without the parallel consideration of respectively the
control and the organizational perspective. This points to a need for means for
demonstrating the mutual interaction of the two perspectives in practice, e.g.
simulation games.
6. REFERENCES
Haas, Henning de and Hans-Henrik Hvolby, (1995): "A Holistic and Situational
Approach for Effective Production Planning and Control" Molde College,
Norway, May, 1995.
Skinner, W. (1978): "Manufacturing in the Corporate Strategy" Wiley, Chichester,
UK
DI - Danish Industrial Society (1993): "Employee Activated Production
Development" Danish Industrial Society, Denmark (in Danish).
Mintzberg, Henry (1989): "Mintzberg on Management: Inside our strange world
of organizations" The Free Press, NY, USA.
7. BIOGRAPHY
Henning de Haas received his M.Sc. in engineering at the Department of
Production, Aalborg University, in 1994 and completed his Ph.D. studies in the
Summer of 1997. He is now employed at Bang & Olufsen.
Jens O. Riis is a Professor of Industrial Management Systems at the Department of
Production, Aalborg University, Denmark. He holds an M.Sc. in Mechanical
Engineering from the Technical University of Denmark and a Ph.D. in Operations
Research from the University of Pennsylvania, USA. His main teaching and
research areas are design of production management systems, technology manage-
ment, project management, and integrated production systems. Prof. Riis is a
member of the IFIP Working Group 5.7 on Computer Aided Production
Management Systems.
Hans-Henrik Hvolby is an Associate Professor focusing on production planning
and control, order management and information systems. He received an M.Sc. in
management systems from Aalborg University, Denmark in 1984, and in 1989 he
earned a Ph.D. degree from the Department of Production, Aalborg University
Since 1989 he has been on the faculty of the same department, interrupted by a two
years leave of absence as a project manager with F.L. Smidt..
21
Implementing new production
management modes - Orchestration of
simultaneous improvement activities
J.o. Riis, J. Knopp

Dept. 0/ Produetion, Aalborg University, Fibigerstraede 16,
DK-9220 Aalborg, Denmark
E-mail: i9jor@iprod.aue.dki9jk@iprod.aue.dk
Abstract
This paper represents an attempt to shed light on an important issue for
development of production management, namely the orchestration of several
individual development projects and initiatives of different type and nature necessary
for achieving an overall significant improved performance.
The paper will first introduce three types of development initiatives: (1) Cross-
functional development; (2) Functional development; and (3) Local development.
Then incrementaI and innovative changes will be discussed and a more differentiated
classification will be proposed. This provides a framework for modeling different
development processes which will be illustrated by means of two case examples. In
addition, the results of a Danish survey on Continuous Improvements will be
related to the three types of initiatives. Tentative theoretical and practical implica-
tions will be outlined.
Keywords
Implementation of production management. Multi-project management.
Continuous Improvement.

© 1998lFIP. Published by Chapman & Hall
Implementing new production management modes 231
1. INTRODUCTION
Much research on production management is void of any consideration of how the

developed theory, method or system should be implemented in practice. This may
often be justified in view of the requirements and context in which much research is
carried out. However, if we want to bridge the gap between theory and practice, we
need to address the implementation process, in the first place to understand its
nature and secondly to derive approaches for speedy introduction and adoption of
new production management modes.
The Japanese effort to combine Kaizen with any technical change whether it be
within quality, productivity, maintenance, or just-in-time, is a clear indication of
the acceptance of the importance of implementation issues, cf. Imai (1986), Suzaki
(1993). An essential element of Kaizen is the involvement of employees in the
process of improvement which increasingly has been seen as a major challenge in
Western industrial countries. In the U.S. the concept of empowerment has appeared
as an important issue, and in Western Europe the notion of Continuous
Improvement has gained wide-spread recognition, cf. Bessant et al (1995).
However, there has been a tendency to view Continuous Improvements as closely
related to changes within a working group. Production Management, in contrast,
focuses heavily on improving the overall interplay between planning units and
working groups. Hence, there is a need for linking improvements at various levels
in the industrial enterprise.
Based on empirical studies, we have observed that changing production
management often requires changes in other elements of a production system, such
as production processes, wage systems, product program, purchase, etc. To
illustrate, in one industrial enterprise a needed change of the production
management system came to a halt after a good start, because of the wage system.
Its incentives did not at all stimulate any changes in the current operations. Hence,
focus bad to be drawn to adjusting the wage system. Thus, when addressing
implementation of production management, it is necessary to adopt a broader
contextual view.
At any point in time, an industrial enterprise will carry out several individual
improvement initiatives aimed at various parts of a production system and often
with different time horizons. The orchestration of such projects represents a major
challenge.
In this paper we shall present a model of a development and implementation
process which captures the complex picture of many, different types of individual
development initiatives concurrently in p~gress in an industrial enterprise.
Secondly, based on empirical case examples the paper draws implications for
planning the implementation process for improving production management in an
industrial enterprise.
2. THREE TYPES OFCOMPANY DEVELOPMENT
Based on observations in several industrial enterprises, we have noticed that most

often a company development process involves activities of different nature. This
has led us to identify three different types of focal points for company development.
2.1 Cross-functional and interdepartmental development
This type of development looks at the overall organization and the interaction
between subsystems (e.g. departments, sections and units). It addresses the need for
overall integration of activities, e.g. derived from customer demands. Ordinarily, the
role of the various management systems is to take care of this task, such as the
production planning and control system, quality management system, econornic
control system, etc.
In production management the Materials Requirement Planning (MRP) arxl
Optimized Production Technique (OPT) represent two approaches to planning arxl
control of the production flow, focusing respectively on the acquisition of materials
and on bottlenecks. By suggesting the preparation of a Problem Matrix through a
collaborative process and development of a Production Management Concept we
have provided means for diagnosing the complex interplay between sections arxl
departments in connection with production planning and for establishing an overall
picture of how the interplay should be (Riis, 1990).
2.2 Functional development
This type of development focuses on the development in one of the functional

areas, such as product development, production engineering, personnel arxl
administrative systems development. It addresses the need for differentiation arxl
specialization.
In any organization it is necessary to develop competencies in a number of areas
capable of establishing effective support systems, such as management systems for
production planning, quality, finance, wage system, personnel training and devel-
opment, etc. Similarly, professional expertise is needed for developing the
company's products and services and the production and logistics systems required
for realizing the delivery of products and services to customers.
Often these functions take part in the daily operation. However, their main role
in the enterprise is to develop improved solutions for the daily operation.
2.3 Local development
This type of development is concerned with the individual organizational unit

responsible for a certain part of the daily operation, e.g. a production group or a
workshop. As we have seen, especially under the umbrella of Continuous
Improvement, such an organizational unit is often capable of not only carrying out
the daily operation, but also of suggesting and implementing significant
improvements. Local development is often seen as a means for employee
development and for stimulating creativity in operations.
Tbe formation of production groups, e.g. on the basis of production flow
analyses and the application of group technological principles, has made it easier to
define the task Gob) of the group and to identify appropriate decision variables
within the group.
Although we are primarily focusing on the operational activities, represented by a
production group, an assembly group, or an administrative unit responsible for
invoicing, local development may also take place in an engineering design group
when they adopt a new method or computer software which may improve their own
performance. For instance, Quality Circles have successfully been implemented in
these areas in Japan.
2.4 Interconnections between the three types of development
As demonstrated above, we believe that it is possible to distinguish between the

three types of development in the sense that any development effort in an enterprise
may be categorized as either of the three types. However, this is not to say that
they are independent. To the contrary, a great many different interdependencies exist,
the understanding of which represent achalIenge to both theory and practice. To
illustrate we shall give a few examples of such interdependencies.
The definition of the local organizational unit. Several production

management systems implicitly consider a single machining tool or machining
center as a planning unit and frequently insert an inventory between two units. As a
consequence, a plant is often divided into a large number of planning units,
typically between 50 - 100.
By introducing larger organizational units, e.g. a production or an assembly
group, with the task of completing the operations or assembly of a part or
component, the plant may be divided into fewer planning units, typically 8 - 12.
Not only is more autonomy given to each unit, but the overall planning task
becomes much easier and provides a better opportunity to maintain a
comprehensive understanding of the overall planning situation.
Hence, the definition of local organizational units has a great influence on the
ability to establish an overview at a cross-functional level. Development of a
production management concept with a rather small number of planning units, aOO
a joint cross-functional and local development holds great potential for synergy.
The recent focus on activity chains and business processes may similarly lead to
formation of technical-administrative groups (planning units) situated along a
business activity chain providing a basis for significant improvements of both local
and cross-functional development type.
Integrating functional development. As has been observed in Continuous

Improvement activities, at a certain stage continued local development will depend
on support from one or more functional developments, e.g. an improvement of the
wage system (e.g. a shift in the bonus system), of the quality management system,
or of the production planning system. The effort on integration in manufacturing in
the past decade has clearly demonstrated that suboptimization is likely, if not the
effort of the various functions are coordinated. Furthermore, an integrated effort has
great potential for yielding a significant synergy with a multiplying effect on the
overall performance.
Hence, the extent to which functional developments are coordinated will have a
marked influence on cross-functional and local development.
3. INCREMENTAL OR INNOVATIVE DEVELOPMENT
The development effort within each type may traditionally be categorized as either
incremental or innovative, cf. Imai 1986. For cross-functional development, the
OPT approach to production planning and control with its focus on bottlenecks has
proved to be very successful as an incremental cross-functional change. We have
been involved in several practical cases in which it was possible with a rather
limited effort to identify critical bottlenecks and furthermore quickly to initiate a
drastic change in the overall performance of the production system.
On the other hand, the implementation of a Just-in-Time mode of production
implies a shift in paradigm, requiring a change in attitudes, a new management
system, etc. This signifies an innovative development. In a similar manner, it is
possible to distinguish between incremental and innovative development of the
functional and local type.
However, there is a need to differentiate between the nature of the change and the
pace at which it is implemented. The nature of change may either be incremental or
radical. An incremental change rests on the current mode of operation and its
systems and seeks improvements within this framework. On the other hand, a radi-
cal change implies a shift of paradigm, i.e. a new point of departure based on a
different approach or set of assumptions.
The other dimension captures the pace of realizing a change which may either be
a sudden, fast and discontinuous change, or the change may be gradually
implemented over a longer period of time. By combining the two dimensions we
obtain four options, as shown below in figure 1. They retlect a more differentiated
view of the nature and pace of the development process.
Pace of Change
Nature of Change Sudden and Gradual and
fast slow
Incremental
Crash or crisis Continuous
(resting on eurrent mode
program improvement
of operation)
Radical
BigLeap Innovative
(based on a new paradigm)
improvement
Figure 1 Four modes of development dependent on the nature and pace of

change
4. MODELING A DEVELOPMENT PROCESS: TWO CASE

EXAMPLES
With the three types of development and four modes of change (nature and pace) we
have a set of descriptors for modeling a development process, as a step towards
understanding the nature of an overall development process and for planning. We
shall demonstrate some of the aspects of modeling by means of two case examples.
CaseA
With the intention of developing a new way for the sales offices abroad to interact
with the domestic production plant aimed at speeding the handling of custom
designed products, the management initiated three parallel development processes:
(1) an analysis and diagnosis of the activity chains associated with handling of cus-
tom orders across functions, which initiated local development activities; (2) a
systems design project aimed at developing a new computerized logistics
management system; and (3) the development of avision of the future company,
especially capturing the logistics aspects.
The development process of the project is depicted in figure 2.
As mentioned, the incremental process initiated at the cross-functional level started
a continuous improvement process in several production units. However, after
some time the local development process came to a halt. Originally, management
believed that the local development processes would lead to the development of an
overall vision; but this did not take place. One reason offered was the inadequate
background of the operators and foremen to actively take part in an innovative
discussion at the cross-functional level. Instead, management and external

consultants developed avision and put much effort into conveying the vision to the
employees.
Development types
Activity chain
analysis
Development of avision
Cross-
functional
Functional
Systems
development
Implementation
Local D
Continuous Improvement
in production groups
Present Time
Figure 2 The development process in case A
Another observation relates to the cross-functional and functional development.

Because management in the middle of the process took over the responsibility for
the development of avision from the production manager, it realized that this pro-
cess ought to be coordinated with the systems design project which it was also
responsible for. Hence, more or less by accident the two development types became
coordinated with mutual benefit.
At this point management realized that the local development bad stopped arxl
noticed that the workers' perception of the necessity to improve the logistic
performance was very much different from what management bad perceived. As a
way of establishing a connection to local development, management arranged a
study tour for all employees to the annual European exhibition of its industry
which would also include an opportunity to see competitors' products. This brought
about a shift in the employees' perceived need to change.
The case example clearly demonstrates the interrelationship between the three
different types of development. Management has leamed that it is necessary to
include a11 three types in the overall planning of improvement initiatives.
lmplementing new production management modes 237
CaseB
In an attempt to gain a better overview of its many development activities, the

cross-functional section of company B analyzed 11 completed and 7 newly started
development projects which resulted in the map shown in figure 3.
The mapping was carried out collaboratively between engineers from the cross-
functional section and researchers and demonstrated that it was, in fact, possible to
identify a project as one of the three types of development. However, it was useful
to think of the person who is carrying out the activity, rather than those who will
be impacted. Furthermore, it was suggested in some instances to split a larger
project into sub-projects, because they belonged to different development types. As
to the distinction between incremental and innovative, it was fairly easy to identify
incremental initiatives, whereas it was rather difficuIt to arrive at a cIear definition
of innovative development. However, the discussion initiated the distinction
between nature and pace of change, as introduced in section 3 of this paper.
Only major relationships between development projects are shown in figure 3.
However, the analysis gave rise to a discussion of why some projects apparently
stood alone. Several types of re1ationships were defined and will be used in further
analysis.
The mapping also led to identification of different modes of managing company
development initiatives. One mode is similar to the traditional Kaizen activities
predominantly of local nature, and it was noted that the projects in figure 3 are
strongly biased towards cross-functional activities compared to the overall company
picture with the relatively few local development activities. Another mode is
functional development projects which tend to remain as such, despite many cross-
functional and local development elements. And a third mode is a traditional
development program which would start with a broad feasibility study as a cross-
functional activity. If a continuation is warranted, several projects would be
initiated of all three types of development.
The analysis gave rise to the following conc1usions:
• A development project on logistics was defined as an EDP project (functional

development). This explained some of the difficulties encountered. If initially
the project had been defined as also related to cross-functional and local develop-
ment, management feIt that it would have been implemented much faster .
• There were many stand-alone projects. If they bad been related to other
improvement activities, management feIt that a larger synergy would have
emerged.
• The large number of improvement projects gave rise to a critical assessment of
the capacity and capability to also implement the initiated projects.
• Management realized that it was necessary to develop a set of different working
modes for managing improvement activities which would incIude a mixture of
the three types of development and a more systematic discussion of when to
adopt an incremental and a radical scope of change.
Development types
D
Cross-
functional
CJ
Functional
Local D o
Present Time
Figure 3 A mapping of 18 development projects in company C
5. RESULTS FROM A SURVEY ON CONTINUOUS IMPROVE-

MENT
A survey of 87 Danish industrial business units indicates that most of the

companies have two to five years of experience with Continuous Improvement.
The survey was conducted as part of a EUREKA network activity called EuroCINet
(Gertsen et al., 1995) and may be slightly biased towards including several "Best in
Class" companies in terms of engagement and application of Continuous Im-
provement.
To explore how experienced business units in the sampie differ from less
experienced business units, the sampie was segmented into two groups according to
the managers' own assessment of their status. The two groups comprise respec-
tively 45% and 35% of the sampie.
Some of the results of analyzing the two groups may be related to the three
different types of development. The high experienced business units seem to
consider Continuous Improvement as more strategically important and concerned

with customer demands, i.e. cross-functional development. Continuous
Improvement also seems to be more in line with previous change programs, aOO
the business units are better to maintain the change process and to handle multiple
development activities of different types.
Regarding functional and local development, in the high experienced business
units almost all organizationallevels contribute to the development activities.
If we narrow the group of experienced business units in our analysis by taking into
consideration the number of years that they have been working with Continuous
Improvement, the above tendencies appear stronger.
6. DISCUSSION AND CONCLUSION
AIthough only a few case examples have been used, it seems fair to claim that it is
possible to depict the development process as a set of parallel and serial activities
related to either of the three types of development. Some times it is necessary to
split a project into sub-projects which belong to either of the three types of
development. However, this calls for further studies of the interrelationships
between development initiatives.
In the case studies it was observed that it was rather easy to identify an
incremental development activity, whereas an innovative development project was
difficult to describe. As a consequence, a more differentiated classification was
offered and will be used in further studies. The case studies have supported the view
that incremental and innovative changes are mutually interdependent.
The case studies clearly have demonstrated a need for mapping development
activities of various kind as a means for providing a better overview of initiatives
and utilization of their mutual interdependencies so as to achieve a potential
synergy. Apparently, there are several obstacles in an industrial enterprise to
achieve a better orchestration of development activities, such as decoupled
initialization of change; the cost of coordination; incompatible mind set aOO
terminology; communication problems; spatial separation of business units aOO
sections; potential conflicts of interest; and competition on resources for various
purposes. It is believed that a visual mapping of development activities may
contribute to reduce some of these obstacl(~s.
Introduction of new methods and systems in production management usually
implies working with all three development types in parallel and sequentially.
However, there is not one best entry for initiating a development process; it may
either be as a local, a functional or a cross-functional development activity. We
believe that an increased marginal overall improvement may often be achieved by
shifting to another type of development. As a consequence, it is relevant to develop
a capability for orchestrating improvement activities of different types.
7. REFERENCES
Bessant, John et al. (1995): Continuous Improvement - The European

Dimension. The 2nd International Conference on Management and
New Production Systems. EurOMA. Twente 28-31 May, Netherlands.
Gertsen, Frank, Jeanette Knopp and Jens O. Rüs (1995): Continuous Im-
provement in Danish Manufacturing Industries - Report from a sur-
vey of 87 business units. In Proceedings of the EuroCINet Conference,
6-7 December, Gatwick, UK.
Imai, Masaaki (1986): Kaizen, McGraw-Hill.
Riis, Jens O. (1990): The use of production management concepts in the
design of production management systems, Production Planning &
Control, Vol. 1, No. 1,45-52.
Suzaki, I<iyoshi (1993): The New Shop Floor Management - Empowering
People for Continuous Improvement, The Free Press.
8. BIOGRAPHY
Jens o. Riis is a Professor of Industrial Management Systems at the Department of

ment, project management, and integrated production systems. Prof. Riis is CUf-
rently heading two research programs in integrated production systems and technol-
ogy management, and is a member of the IFIP Working Group 5.7 on Computer
Aided Production Management Systems and of the international editorial board of
several international journals.
Jeanette Knopp received a B.Sc. in production engineering in 1991 from the Odense
Technical College and an M.Sc. in industrial management systems from the
Department of Production, Aalborg University in 1994. She is currently finishing
her Ph.D. studies at the same department on Change Management.
PARTFIVE
Strategie Aspeets
22
Recent developments in tbe
configuration of multiple-variant
products: Application orientation and
vagueness in customer requirements
Stephan Schwarze and Paul Schönsieben

Institute o/Industrial Engineering and Management (B WI)
Swiss Federailnstitute o/Technology ETH Zürich
Zürichbergstrasse 18, CH-8028 Zürich, Switzerland
Tel: +41 1 63205 10 Fax: +41 1 632 1040
schoensleben@bwi.bepr.ethz.ch
Abstract
To face the problems of mass production the configuration of multiple-variant
products becomes more and more important. In this paper an approach is presented
for improving the configuration process. Therefore the process is split into three
stages. The important stage to make configuration services more customer friendly
is the Specification Mapping. As a basis for the configuration process a common
configuration data model exists which contains functional application-oriented
knowledge in addition to conventional technical data. Furthermore vague
knowledge is integrated into a product configuration, and finally a short realization
guideline is presented.
Keywords
Configuration of Multiple-Variant Products, Functional Knowledge, Product
Modeling, Customer Orientation, IMS

244 Part Five Strategie Aspeets
1. INTRODUCTION
In recent years, customers have become more critical and choosy. Individual
customers have specific requirements for offered products. Customer orientation is
becoming an important phrase for many companies; the customer must be the
focus of all activities within the company. As a result, one-of-a-kind production
has emerged as a new trend. Compared to mass production, the number of product
variants increases drastically. Furthermore, the competition between companies
increases quickly. Speed and flexibility in design and manufacturing are very
important for the success of companies.
A product configurator that can use customer requirements directly as input is a
necessary tool for any company that wants to be able to offer engineered-to-order
or assembled-to-order products to individual customers. The necessity of a product
configurator for customer-oriented companies becomes obvious if they ask
themselves the following questions (Fazio, 1994):
What do you do when your product expert suddenly leaves the company?
What happens ifyou have more conjiguration problems to solve than your product
experts are able to solve?
Existing configurators still have many deficiencies. Therefore, an improved

customer-oriented configuration approach will benefit many companies.
Before actually manufacturing a product, it is necessary to configure it correctly.
Ouring the configuration process the product is tailored to meet the customer's
needs. It is determined, for example, what the detailed components of a product
are, how the final product is assembled and what processes are necessary to
manufacture the product. To configure a product variant correctly, company-
internal knowledge (from designers and engineers) is essential as is the customer's
functional application-oriented knowledge. This functional knowledge can incIude
the intended use of the product, its desired functionality or its features. The
company's knowledge mainly covers the technical and structural aspects of the
products, e.g., technological know-how, production facilities, knowledge about
parts and components, connecting possibilities, etc.
Ideally, the initial input for product configuration sterns from the customer's
functional requirements. The customer gives a functional specification covering
the desired features. This specification has to be satisfied by the configured
product. Frequent problems inherent to such functional requirements are that
• the customer's input is incomplete, and
• the customer's requirements are vague and uncertain.
Today's configuration approaches mostly ask for a detailed (technical) product

specification as input. Customers must be familiar with the technological details of
Recent developments in the configuration of multiple-variant products 245
the desired product and often have to specify technical parameter values. However,
frequently the customer (or the salesperson) does not have sufftcient knowledge to
give such a precise specification and can only provide his specification as
qualitative, functional requirements.
This functional (possibly vague or incomplete) specification has to be
transformed into appropriate technical parameter values. Here, individual
preferences and misinterpretations have to be avoided, and even for complex
products all input knowledge has to be used. Individuals mostly cannot provide a
reliable configuration service manually. The solution is a software-supported
product configuration.
The first stage in product configuration, the Specification Mapping, is a central
point for the integration of customer knowledge into the configuration process (see
Figure I). In this stage the functional, application-oriented input is transformed
into technical or structural knowledge.
interface between
marke! and company
Specification
Mapping
market,
custom er
configuration
rocess
com an
Figure 1 Product as interface between market and company
Configuration problems exist not only for industrial companies, but also for
insurance companies and banks that recognize a high individualization potential in
developing customer specific services (products) (Link and Hildebrand, 1995).
Therefore, a method of customer-oriented product configuration can also be
applied to products in the service sector (service products).
2. THE PRODUCT CONFIGURATI ON PROCESS

The main idea that is presented in the following is the possibility of separating the
process ofproduct configuration into three stages (Schwarze 1994). This approach
avoids the problem of solving separate subtasks at the same time. Each stage
concentrates on a special phase within the configuration process. Another
argument for several stages is that the feature of rule-based systems does not allow
for a clear separation between knowledge and control. With rules, not only is a
relationship between components expressed, a sequence of actions is also
determined (Weigel and Faltings, 1994). Thus the maintenance becomes easier if
subtasks are treated separately and the respective knowledge is kept in different
knowledge bases.
The three stages in a product configuration process are
I. Specification Mapping,
2. Technical Configuration and
3. Choice and Optimization.
Figure 2 shows this new concept. A bicycIe serves as an example of a product in

the figure. The basis for the three stages is one common configuration data model
(see Section 3) in which any information that is relevant in any configuration stage
is modeled. In practice, the information in this common configuration data model
can be kept in several knowledge bases.
To simplify the configuration process, specifications that can be changed should
be separated from those that cannot. These firm decisions are preferably made in
the Specification Mapping stage.
A special situation exists for simply-structured products in the service sector, like
bank credits. Their structural constraints are mostly very simple whereas clistomer
requirements can be complicated and extensive. Therefore such products can be
configured in a single stage that is very similar to the Specification Mapping stage
in an engineering product configuration process. The principles are the same as
those discussed in Section 4.
3. CONFIGURAnON DATA MODEL
Product information can be split roughly into functions and physical principles
(Chen and Menq, 1992). Pure physical models are very popular, but they do not
consider functional product aspects that are only indirectly product-related but
rather application-oriented. Such functional requirements are types of abstract
information.
A precondition to developing a modem configuration approach is that product
functionalities can be modeled. This task must cover two aspects:
• The functionality', in particular the application, of a product must be modeled.

Recent developments in (he conjiguration oJmultiple-variant products 247
• The relation between a product's functionality and its structure must be

considered.
Sembugamoorthy and Chandrasekaran (1992) require the task of functional

modeling to support the understanding of complex devices. Representing a
device' s functionality
• requires a description of "what a device is", achieved by recursively
decomposing it into subdevices Iinked with component ofrelations, and
• a deseription of "how a deviee works" by identifying functions of subdevices
and describing their behaviors.
luncliona l
requ irements customer
..
conligured
bicycle
Figure 2 Three stages in the conflguration process
Funetional descriptions are naturally modular, which means that a device can be
replaced by a totally different device that aceomplishes the same funetions. Thus, a
graph that is a hierarchy based on funetional properties ean be drawn. For a
company, the representation of functions in the configuration data model leads to
the following advantages (Chawla and Sangal, 1992):
*Functionality in this context does not mean the technical functions of a product but the application-
or requirement-oriented view. Its purpose is to integrate the customer's view of a product into the
configuration data model.
• It guides the task of searching for a certain product.

• It can be used for decomposing problems into finer details.
• It supports finding all parts that satisfy a particular function.
• It enables one to formulate restrictions that have to be fulfilled in order to to
carry out a function.
For a configuration problem, this means that a functional decomposition can

consist either of a function being decomposed into other functions, or components
that carry out the function being determined. Instead of integrating variables that
represent functions and variables that represent components as suggested in
(Mittal, 1990), it is better to distinguish between a functional and a structural (or
technical) hierarchical decomposition of a product. Requirements appear at the
leaves of a functional decomposition tree. They are not decomposed into
subrequirements, but they are put in relation with components by formulating
rules.
To fulfil the requirement of modeling a product's functionality, Schönsleben's
product model (SchönsIeben, 1994) has been extended to meet the requirements
for a configuration data model which can be used as a base for any of the three
configuration stages. Details about the configuration data model and the new
c\asses are given in (Schwarze, 1996). An earlier version of this extension was
developed through the research project IMS/GNOSIS (IMS/Gnosis, 1995; Gosset
and Massotte, 1994; SchönsIeben and Schwarze, 1995) and was guided by
industrial requirements.
4. SPECIFICATION MAPPING
The Specification Mapping is the first stage in product configuration. The goal is
to transform the functional knowledge provided by the customer to a structurally
concrete and precise product specification [KuSz92]. External knowledge from the
customer is transformed to meet company-internal requirements. Intemally,
technical, production-oriented knowledge is most important. The Specification
Mapping covers the functional aspects of product configuration and is usually
done by salespeople in companies. Very often it is neglected, and this neglect can
have a negative influence on the final configuration result because an incorrect
Specification Mapping can never lead to correct product configuration.
Major problems in this stage are
• that uncertain, rough and tacit knowledge has to be used and
• that the input data does not have a fixed format but varies widely in
appearance.
Equivalent information can be given by different customers in different formats.

Nevertheless, this input has to be interpreted correctly so that the same product
Recent developments in the configuration of multiple-variant products 249
specification is created. The data that is treated can be of unsure ongm. For
example, a customer often gives information about the performance, the area of
use or the quality ofthe required product: he describes the required functionality of
the product, and this functional description usually is more application-oriented
than product-related. Therefore, this stage is the most risky part of a configuration
system.
It is ademanding task to get this Specification Mapping done automatically.
Expert system techniques are an appropriate means. But if the input information
and the input format should remain free, the automation of the Specification
Mapping can be very problematic. Even in a rather small domain, the expert-
knowledge database has to be huge to cover all possible input values (SchönsIeben,
1988; SchönsIeben and Oldenkott, 1992, van Veen, 1992; van Veen and Wortman,
1992).
If the information about the required product is not sufficient, it has to be
completed. The customer has to provide more input and must describe the product
with more details, possibly by answering concrete questions. This is also necessary
to limit the number of possible configurations.
It is desirable that the customer gets as much freedom as possible when
specifying the requirements for a product. He should be free in what kind of
information he provides about the desired product: functional information,
technical information, structural information, etc.
In general, two different situations can be distinguished when a customer
specifies his requirements (see Figure 3).
I. The customer has the ability to specify the technical parameters directly. In
this case it is possible to abstain from a Specification Mapping.
2. The customer has knowledge only about the functionality of the required
product. Then the Specification Mapping is necessary to transform this
knowledge into a technical product specification.
Obviously, the procedure of product configuration is much easier in the first

situation. In this case the risk of errors is much lower because concrete parameters
and features are specified directly by the customer. But the first situation only
exists for very competent customers.
Customer directl S Geil;es arameters
Figure 3 Necessity of the Specification Mapping

5. CONSIDERATION OF VAGUENESS IN A PRODUCT

CONFIGURATION
Frequently, vague knowledge appears in a knowledge source for a configuration

system. Mainly two points where the problem of uncertainty becomes obvious
exist:
• Often the customer can only provide a rough and vague description of what he
wants.
• The configuration or sales experts that have to interpret the functional
requirements are used to formulating their knowledge by using natural
language terms.
80th aspects are described in more detail in the following and have to be
considered in a modem configuration system.
5.1 Vague Product Descriptions
When specifying the desired product, a customer very often uses vague, fuzzy
terms (ehen and Menq, 1992; Bode et al., 1994). He describes the functionality of
a product by using words Iike "often", "sometimes", "never", etc.,or qualitative
input Iike "big", "cheap", "fast", etc. This is the easiest way for a customer to
specify what he wants because he can use the same words as in a shop.
Therefore, a requirement for a configuration system is that such blurred,
colloquial terms are allowed as input information. This makes the systems much
more user-friendly, and the acceptance for using a configurator will be higher. The
customer can use the same notation for specifying a product that he has always
used. The other advantage is that no knowledge will be lost. The user provides the
product specification that he really has in mi nd directly. Ifhe had to transform his
own colloquial product specification into a formalized description that could be
understood by the system, a lot of information might get lost during this
formalization. Furthermore, he can provide the information on his own and does
not need a knowledge engineer to transform it correctly.
5.2 Vague Expert Knowledge
In an expert system for executing a configuration, most of the knowledge for

interpreting the functional product specification and creating a technical
specification will come from configuration experts or from sales or marketing
people (Popp, 1994). These people are used to formulating their knowIedge in
colloquial terms. For example they formulate rules like
Recent developments in the configuration 0/ multiple-variant products 251
if a bike is often used in races

then it shouLd have thin tires,
where the tenns "often", "should" and "thin" are naturallanguage expressions.
Again, a configuration system should accomodate the use of such tenns. The
objective is to make expert heuristics usable for machines. The consequences are
the same as given above: the acceptance ofthe system will be much higher because
experts can directly use naturallanguage.
+- --
corr,I.Uon, oilisks
Figure 4 Task structure for realizing a Speciflcation Mapping system
Little infonnation will be lost due to fonnalizing rules into another notation. The
configuration expert should be able to implement the rules on his own without
being dependent on a knowledge engineer.
A further advantage is that the knowledge is immediately understandable to new
employees. They do not have to interpret an unknown notation. Finally, it is easier
within the system to interpret the customer's requirements if identical (colloquial)
tenns are used both for data input and in the rules.
Both sources of vague knowledge are linguistic uncertainty. Therefore fuzzy
logic is an adequate methodology to handle this vagueness. A concrete approach
for integrating fuzzy logic into a configuration system is described in (Schwarze,
1996).
6. REALIZA TION
Figure 4 shows the structure of tasks that have to be executed for an

implementation (Schwarze, 1996). The separate tasks stern from aspects mentioned
in the previous sections. Obviously, some tasks cannot be undertaken
independently, but correlate with other tasks as indicated below.
Before the Specification Mapping system can be used in practice, it has to be

tested for a set of configuration examples. During this test and modification phase
the system has to be modified. In particular, rules must be modified, extended or
newly created. For the fuzzy terms of Iinguistic variables, membership functions
may have to be changed.
7. CONCLUSION
7.1 Summary
An approach for making the product configuration process more customer-friendly

is presented. The entire product configuration process is split into three stages. The
Specification Mapping stage maps functional requirements to structural data, the
Technical Configuration stage determines a set of final products and checks
consistency, and the Optimization stage decides on an optimal product.
Since the Specification Mapping is neglected in most existing configuration
systems, a configuration data model in which functional, application-oriented
knowledge is integrated has been developed.
In the Specification Mapping stage, vague knowledge appears frequently in
individual customer requirements as weil as in product expert knowledge. Since
both types of uncertainty are linguistic, fuzzy logic is used for integrating vague
knowledge into the Specification Mapping system. Therefore, vague knowledge is
also integrated into the configuration data model, and linguistic variables with
associated Iinguistic terms have to be defined.
The Specification Mapping approach is applicable for service products as weH as
for engineering products. Since for some service products, for example an
individual bank credit, the product structure is simpler but the functional
requirements are more complex, the Specification Mapping stage is even more
important. Furthermore, the input to service product specifications is commonly
vague knowledge.
7.2 Outlook
Important future work for the Specification Mapping system itself is

• to improve the user interface,
• to merge the system with the other configuration stages and
• to integrate the system into existing information systems in a company.
The integration of a Specification Mapping system into a production planning and

control system (PPC system) and a product data management system (PDM
system) is particularly important because these systems capture, record and
manage all product-related data and documents. With this integration the
Recent developments in the configuration 0/ multiple-variant products 253
maintenance, not only of structural product knowledge but also of the

configuration knowledge described in the configuration data model can be
guaranteed.
8. REFERENCES
Bode, Jürgen; Xinli, Zhao; Shouju, Ren: Quality Function Deployment: Extensions
and fuzzy concepts in an integrated CSCW environment, in: Proceedings of
the International Conference on Data and Knowledge Systems for
Manufacturing and Engineering, Hong Kong, May 2-4, 1994, p.246-251.
Chen, Baosheng; Menq, Chia-Hsiang: Initial attempts on the characterization of
functional requirements of mechanical products, in: Dutta, D.; Woo, A.C.;
Chandrashekar, S.; Bailey, S.; Allen, M. (eds.): Concurrent Engineering -
1992, The Winter Annual Meeting of the ASME, Anaheim, California,
November 8-13, 1992, p.315-329.
Chawla, A.; Sangal, R.: Functional Reasoning in Configuration Design, in: Gero,
J.S. (ed.): Artificial Intelligence in Design '92, Kluwer Academic Publishers,
Dordrecht, 1992, p.41-60.
Fazio, Gregory J.: Getting the Facts on Rule-Based Product Configuration, in:
1994 APICS Conference Proceedings, p.E12-E13.
Gosset, Paul; Massotte, Pierre: Knowledge Systematization and Sharing - GNOSIS
(IMS) Impact on Industry, CIM Europe Conference Copenhagen, October 5th-
7th, 1994.
IMS/GNOSIS Consortium: Report on the IMS/GNOSIS test case: Configuration
Systems for Knowledge Systematization, 1995.
Link, Jörg; Hildebrand, Volker G.: EDV in Marketing und Vertrieb strategisch
nutzen, in: 10 Management Zeitschrift, 64(1995), No.3, p.85-89.
Mittal, Sanjay: Hierarchical Reasoning Model for Configuration Design Problems,
Research Paper at Xerox PARC, 1990.
Popp, Heribert: Anwendungen der Fuzzy-Set-Theorie in Industrie- und
Handelsbetrieben, in: Wirtschaftsinformatik, 36 (1994) 3, p.268-285.
Sembugamoorthy, V.; Chandrasekaran, 8.: Functional Representation of Devices
and Compilation of Diagnostic Problem-Solving Systems, in: Artificial
Intelligence in Engineering, 1992, p.47-74.
SchönsIeben, Paul: Expertensysteme als Hilfsmittel der variantenreichen
Produktkonfiguration, in: Informatik Forschung und Entwicklung, No. 3,
1988, p.117-127.
SchönsIeben, Paul: Praktische Betriebsinformatik, Springer, Berlin, 1994.
SchönsIeben, Paul; Oldenkott, Hendrik: Enlarging CAD and Interfaces between
PPC and CAD to respond to product configuration requirements, in: IFIP
Transactions B-7, North-Holland, Amsterdam, 1992.
SchönsIeben, Paul; Schwarze, Stephan: Literature Survey: Product Configuration

for Products with many variants, Research Paper at BWIIETHZ, March 1994.
Schön sIeben, Paul; Leuzinger, Ruth: Innovative Gestaltung von
Versicherungsprodukten, Gabler, Mainz, 1996.
Schwarze, Stephan: The Procedure of Product Configuration and Handling the
Configuration Knowledge, in: Burke, L. (ed.): Proceedings ofthe Third IERC,
Atlanta, May 1994, p.220-225.
Schwarze, Stephan: Configuration of Multiple-Variant Products: Application
Orientation and Vagueness in Customer Requirements, vdf Verlag, Zurich,
1996.
Veen, E.A. van: Modelling Product Structures by Generic Bills-of-Materials,
Manufacturing Research and Technology, Vol. 13, Elsevier, Amsterdam,
1992.
Veen, E.A. van; Wortmann, J.C.: Generative bill of material processing systems,
in: Production Planning & Control, 1992, Volume 3, No. 3, p.314-326.
Weigel, Rainer; Faltings, Boi: Constraint-based knowledge representation for
configuration systems, Technical Report No. TR-94/54, Ecole Polytechnique
Federale de Lausanne, Department d'lnformatique, 1994.
9. BIOGRAPHY
Paul Schoensleben, 1952, studied Mathematics and Operation Research at the

Swiss Federal Institute of Technology ETH in Zurich. He obtained a master's
degree in 1977 and a Ph.D. degree in 1980. Several years of responsibilities for
Computer and Organization departments of industrial companies followed. In
parallel, he developed and introduced a PPC package, today called Expert/400.
From 1983 to 1991 he has been ordinary professor for Business Informatics at the
University of Neuchatel, Switzerland. Since 1991 he is ordinary professor for
Industrial Engineering and Management at the Swiss Federal Institute of
Technology ETH in Zurich. He is co-founder and actually vice president of
ASGI/SGBW, the Swiss partner of APICS.
Stephan Schwarze, 1967, studied Computer Science at the Technical University of

Karlsruhe (Germany) and Victoria University in Wellington (New Zealand). He
graduated with an M.Sc. in 1992. Between 1993 and 1996 he worked at the
Institute of Industrial Engineering and Management at Swiss Federal Institute of
Technology (ETH) in Zurich, Switzerland. In the group of Professor Paul
Schoensleben, his main research focus was on product configuration and product
modeling. He received his Ph.D. in Technical Sciences from ETH Zurich in 1996.
Since 1996, he works as consultant and model developer for Trilogy Development
Group in Austin, Texas (US).
23
The ecology-driven service (r)evolution:
The product longevity approach and its
consequences for production and
corporate management
H. Hübner, Univ.-Prof Dipl.-Ing. Dr. habil.
Head o/Department ''Management Science - Technology
Impact & Innovation Research (TWI) ", University 0/Kassel
Nora-Platiel-Str. 4, D-34109 Kassel, Germany
Tel. +49-561-804-3055, Fax +49-561-804-3186
e-mail: huebner@wirtschaft.uni-kassel.de
Abstract
Development, production, distribution, and relatively short-term use of always
new products increasingly hits against ecological limits of availability of natural
resources and absorbing capacity of ecosystems for emissions and waste.
Therefore, re-orientation of economic activities and a change in the direction and
goal of innovations is required. Application of the Product Longevity Approach
provides for a stepwise "dematerialization" of economy. To ensure customer
benefit, the company has to offer product-related services as a new kind of
business which, in addition to maintenance and repair, will provide for technical
updating and upgrading. Prerequisites and consequences of this change are dealt
with; finally, its practicability is demonstrated by reference to examples.
Keywords
Ecological quality, resource efficiency, product-related service, dematerialization,
"lean" product
PREFACE
The paper describes some results of ongoing research focused on the question in
which way individual companies and, consequently, economy as a whole can
meet ecological requirements to such extent as to ensure the survival of mankind
Advances in Production Management Systems N. Okino, H. Tamura & S. Fujii (Eck)

along with adequate quality of life in a really long-term perspective. To reach this
overall societal goal, the application of "end-of-the-pipe technologies" like elean-
ing technology for water, air, soil, etc. - and recycling technology for "old" pro-
ducts 1, is not sufficient: All these processes again require natural resources and
may cause harmful emissions in turn.
The further structure of the paper follows the main questions of interest for
experts and decision-makers dealing with issues of the necessary re-orientation of
economy.
1 WHA T: THE PRODUCT LONGEVITY APPROACH (LA)
The ecological quality of a product may be described as a result of determining its

partial qualities related to all stages of a holistic product life cyele model (Hübner
& Simon-Hübner, 1991).
The utilization period of a product is one dimension wbich influences directly
the ecological quality for the utilization phase. As physical goods and their
components are representing material and energy necessary for the several pro-
duction processes and transportation, a longer utilization period generally means
bigher ecological quality by increasing resource efficiency. The energy embodied
in the product and components respectively cannot be recovered for new use, and
recycling processes will require additional energy.
As the amount of production-related waste - depending on individual branches
of industry - may be several times as much as the mass of the produce, the
utilization period indirectly influences the ecological quality for the stage of
production by avoiding accumulation of production-related waste. As, by reduc-
ing new production, the consumption of further new resources will also be
reduced, application of the LA implies a comprehensive improvement of ecolog-
ical quality in the sense of dematerialization.
Duration 0/ product use may be defined as the period of time between first
commissioning and final decommissioning of a product.
A distinction may be made between economic and technical duration of pro-
duct use: The technical duration of use refers to non-repairable goods with
constant efficiency (e.g. light bulb, electronic components) over a certain period.
For repairable products with decreasing efficiency and operability, we may refer
to the economic duration 0/ use, identifYing the period during which the
consumer maintains the good in operable condition, as the best alternative for
reaching an intended goal. Due to tbis, economic weigbing-up between the
alternatives repairing and replacing is possible.
1 In Gennany, 600,000 tons of clothing (Keller, M., 1994, p. 72) and 900,000 tons of electrical appliances
and electronic equipment (ZVEI, 1994, p. 19) have to be disposed ofannuaIly.
2 For example, the production-related waste for personal computers is 20 times the weight of a pe, namely
320 kgs, including 20 kgs ofdangerous "special waste" (cp. Grote, 1994, p.93).
The ecology-driven service (r)evolutiofl 257
Decreasing operability of products results from deterioration by wear, aging,

corrosion, rupture etc. which, however, affects only specific components (e.g. so-
called "wearing parts"). As full operability can be re-gained by measures of
maintenance practically as often as wanted for repairable products, only the
economic duration of product use is applicable.
Application ofthe LA is based on some "axioms":
(1) Allowance for reasonable further technological development must be
possible on demand of consumers (technological updating and upgrading).
(2) There is no reduced benefit for the customer using long-lived products; the
"surplus" is an active contribution towards relief of the ecosphere, to be
communicated by the company.
(3) As the price of new long-lived products3 may be higher as against short-
lived "throw-away" products, different financing and using concepts (such
as leasing) may be developed to relieve the customer.
(4) The consequences for the company will not affect the overall goal, namely
to ensure its long-range existence.
2 WHY: ECOLOGICAL - I.E. LONG-RANGE ECONOMICAL - CON-

STRAINTS AND THE LIMITS OF "TURBO"-INNOVATION
Damage and partly irreversible destruction of the ecosphere with all of its com-
plex ecosystems has become one of the main problems of mankind. 4 Change of
climate, dying forests, extinction of plant and animal species, menace to health,
also of humans, worries about the future and aggressiveness of youths S , may be
mentioned as main effects.
An ecosystem is "the functional unit formed by organisms and environment
interlinked by a multitude of mutual relations. The ecosystem has a certain
regulating force, by failure of which the system will be destroyed" (Bund für
Umwelt- und Naturschutz, 1988, p. 248).
ECOLogy is the discipline dealing with the ECOnomy ofnature, as the "science
of structure and functions of nature, of the interrelationships of organisms
among each other and with their environment" (cp. Weigmann, 1985, p. 7 &
seq.). Since ecology asks questions about the interrelations between human
communities and biosphere, it has started to develop "from a biological sub-
discipline towards a comprehensive task of research with great focusing
competence by offering a framework for coordination of the contributions made
by various disciplines" (cp. Umweltrat (Environment Council), 1994, pp. 14 &
3 The overall sum of priee and eosts during the utilization period normally will be less against buying new
products several times
4 ep., besides others, annual publications ofWorid Bank, World Wateh Institute, environment
ministries/organisations
5 ep. Petri, 1996, p. IV
68). More pragmaticaIly, ecology can be dejined as economy optimized in a

really long-range perspective.
Since about 20 years, the insight is growing that this dangerous development is
caused by men and the economic system, as established since about a mere 100
years: Industrial production and mass consumption related thereto has led, in a
first stage, to saturated markets in most branches and consequently, in a second
stage driven by strong competition, to a "throw-away/waste-oriented" society. It is
weIl known, however, that only about 20 % of the world population are enjoying
the "advantages" of this kind of economy, whereas the remaining approx. 80%
are also exposed to the negative side effects. As the Austrian ethologist and Nobel
Prize winner Konrad Lorenz worked out (1974, p. 25), the established economic
system is based on minous exploitation of natural resources which will not be
found in ecosystems not "driven" by men. This overexploitation concems
• use of the various natural resources as inputs and
• burdening of the ecosystems by emissions and waste as outputs
of production and consumption processes, without considering limited
availability and absorbing capacity.
Practitioners as experts and managers, politicians and scientists of most discip-
lines agree that the kind and direction of economy has to be changed towards
sufficient compatibility with the various ecosystems.
The development and realization of corresponding meaSures may be oriented
on the concept of Sustainable Development, to be understood as avision and
guiding idea.
"Sustainable Development means development that meets the needs of the
present without compromising the ability offuture generations to meet their own
needs. It contains within it two key concepts: The concept of'needs', in particular
the essential needs of the world's poor, to which overriding priority should be
given; and the idea of limitation imposed by the state of technology and social
organization on the environment's ability to meet present and future needs"
(World Commission, 1987, p. 43).
Application of the LA without doubt is one important step in this direction.
Additionally, this approach opens up new directions for innovation in areas
where the limits of technical innovations in the sense of "still more, more
functions, more perfection, more speed, etc." - are visible: Innovation beyond
"Turbo"-Innovation (Hübner, 1996).
3 WHO: THE MAIN PARTIES INVOLVED IN THE ECONOMIC

SYSTEM
GeneraIly, three groups represent the main parties, narnely decision-makers from
political and (semi-) official institutions, companies, and citizens in private
households as consumers. In a market economy,
The ecology-driven service (r }evolution 259
(1) the politicians and decision-makers in public administration are responsible

for the frame conditions considering the kind of economic processes;
(2) decisions on products and production processes are primarily in the
responsibility of the company but will be influenced by
(3) the behavior ofthe citizen related to consuming and buying decisions.
Application of the LA requires changes to be executed primarily by the
companies as the pillars of economic systems. Therefore, the next sections are
concentrating on them.
4 HOW: THE NEED FOR INNOVATIVE CHANGES
4.1 Main consequences of applying the LA
Decisive consequences are

• reduced production volume and capacity required for new products
• need for establishing a "reconditioning loop" offering product-related service
to customers
• changes within the organizational structure
• consideration of the requirements of reconditioning during product devel-
opment
• reduction of production-related waste
• reduction of the volume of "old" products and components to be de-
commissioned during aperiod, and
• increased resource efficiency.
Altogether, the innovative changes require decisions on the strategic level of
corporate management.
4.2 Prerequisite: Strategie decisions
Defining the kinds and fields of business and termination of productlmarket

combinations are strategic core decisions. By application of the LA, a new kind
of business is created as product-related service. Together with the effects of re-
duced production volume and increased ecological compatibility, the company
will shift from a primarily production oriented towards a production-and-service-
driven company with explicit ecological orientation.
The establishment of a reconditioning loop is the most important
organizational/technical innovation required. As differentiation based on the
characteristics of the physical product is very limited in the global market, the
importance of servicing as an instrument to create differential advantages is
generally increasing. Product-related service for product reconditioning goes far
beyond the traditional understanding of "servicing":
(1) Customers have to be convinced of the efficacy (global customer benefit

along with low consumption offiuther natural resources).
(2) In tendency, long-lived products may be more expensive; therefore special
financial services such as leasing, or the sale of use instead of the product,
which then remains the company's property, are opening up new kinds of
service.
(3) As allowance for further technological development must be possible (see
section 1), in addition to the processes of "updating" (inspection, main-
tenance, exchange of "wearing parts", etc.), the processes of technical
"upgrading" have to be organized within the reconditioning loop.
(4) The efficiency of reconditioning processes is strongly influenced by the
structure of the product, kind and number of components, kind and number
of different materials, technological procedures applied for joining, con-
necting, etc.
All these requirements and considerations of further technological development
have to be taken into account during the phase of product development, leading
to new kinds of innovation, too: Ease of disassembling, easy exchangeability of
wearing parts and assemblies with specific technology, timeless design, existence
of recycling procedures compatible with the environment. and similar issues are
prevailing (cp. Brinkmann, Ehrenstein & Steinhilper, 1994).
Consideration of all these aspects, together with reconditioning, provides for a
dematerialization in the sense of "lean products" (cp. Hübner, 1993) and, in
connection with that, increase of resource efficiency. An approach for deter-
mination of the latter has been developed by Schmidt-Bleek, using the measuring
unit MIPS (Material Intensity Per Service-Unit): The quantity of nature, in
kilograms or tons, (in particular material and energy) required for providing a
particular service-unit is measured6 (Schmidt-Bleek, 1993). The smaller tbis
"ecological rucksack" of a product, the greater its resource efficiency.
According to realistic estimates and examples (cp. section 6), it is possible to
increase the resource efficiency by a factor of 5 to >20. Indicating specific
targets for - e.g. annual - rates of increase of resource efficiency for individual
products also belongs to the tasks of corporate management.
Prerequisites for related strategy decisions are changes in the ways of thinking
and understanding of economic processes:
• Development, production and selling of always new products
- is not the only source of economic success and growth
- is more and more restricted by ecological constraints.
• Product-related service in the way of reconditioning is an additional source of
economic success; consequently.
6 This approach has been used successfully to compare different technologies for high-speed train service
systems (cp. Gers et al., 1997)
The ecology-driven service (r)evolution 261
• The product has to be understood as a potential source for further earnings,

also after its delivery to the customer.
• Handling of complaints, supply of spare parts in connection with maintenance
are not to be regarded as "troublesome" but as additional business.
• Value creation by the company serves for value preservation of customers'
products, too.
• Thinking in circulation (reconditioning, recycling) instead of linear sequences
(procurement, production, sale).
4.3 Consequences for the production (management) system
Based on related strategic decisions, the production system has to be redesigned.

Using the Aspect System Approach, a distinction may be made between the
technical-physical and the cybernetic system (Augustin & Hübner, 1984), each
consisting of four partial systems, namely for goals, functions & instruments, re-
sponsibilities, and technical equipment.
Application ofthe LA influences both the technical-physical and the cybernetic
system; primarily by influencing the systems of goals. At the same time, the
manufacturing equipment has to be redesigned with respect to requirements for
reduced capacity and partly changed product structure as necessary for recon-
ditioning.
Against this, the competence and know-how represented in the cybernetic
system - including control and logistics - will remain extremely valuable: not
only for "running" further production but also for establishing and running the
processes of product reconditioning, including technical updating and upgrading.
This also applies for experience in maintenance of technical equipment, which
can be adapted and transferred for product reconditioning.
5 WHEN
To avoid the dangers of catastrophes caused by collapse of the ecosystems,

companies should start or continue immediately in an evolutionary way, oriented
on the guiding idea of Sustainable Development. As may be seen by examples
described or mentioned in section 6, a lot of companies are already very
successful in the economic sense as "eco-pioneers". Real entrepreneurship is
characterized by assumption of societal responsibility without waiting for public
administration and politics to change the overall conditions; however, such
changes are imminent: Changes in the tax system, together with application of
new procedures for calculation of the real, sustainable income of anational
economy, are foreseeable according to the new Club-of-Rome Report (cp. Dieren,
van, 1995). To meet ecological requirements and to solve the world-wide social
problems caused by unemployment, reduction of taxes on human labor combined
with increased taxes on energy and other natural resources in a way to ensure
unchanged overall tax income for public administration are under discussion (cp.
Wuppertal-Institut 1995). Concrete measures of ecological "pioneer states"
elucidate these developments: For instance, Austria - after the Netherlands - has
adopted a "National Environmental Plan" (Austrian Federal Government, 1995),
and Germany passed a law on circulation economy and waste
(Kreislaufwirtschafts- und Abfallgesetz, 1994) which obliges companies to take
back products after the end of utilization.
6 EXAMPLES: EXPERIENCE OF OUR DEPARTMENT AND

REFERENCE TO DESCRIPTIONS IN LITERATURE
Examples as a result of cooperation with companies concern washing-machines,

heating boilers, and refrigerators for private households. Some results are
described in "Berichte aus der TWI-Produktwerkstatt" (Reports from the TWI
Product Workshop) edited by the author. The results of one case study, worked
out together with the German railways and directly related to the LA (cp. Sporr,
1994), are brietly presented below:
Product: Diesel-driven passenger trains (drive car with center car) of the VT
624/634 series of the German railways; year of construction: 1965; quantity in
service: 1005 trains; duration of use originally planned, taking into consideration
repair measures including basic overhaul: 30 years.
Decision of the Kassel reconditioning plant of the German railways in 1994:
Extensive modernization by updating and upgrading since, on account of the
condition of the diesel railcars, a further period of use of about 30 years may be
expected, i.e. total period ofuse around 60 years.
Concrete measures of updating and upgrading for the above-mentioned
diesel railcars:
• Change in space layout:
# Bicycle storage place instead ofbaggage space
# Adoption of a first-dass compartment due toidentified demand
• Replacement of the electrical mercury-operated DCIAC converters by an
ecologically better suited technology
• Improved heat insulation by installing external windows with insulating glass
panes etc.
• New design of driver's cab, taking into account findings of manpower studies,
operation without conductor
• Installation of automatic doors.
Results:
Economic effects: 50 % of costs as against new production.
Ecological effects: Remarkable resource efficiency obtained.
Weight per train: 32.6 t - at least 70% of the steel used will remain in use for
another 30 years, total 60 years, i.e. about 23,000 t for 1005 trains. On the basis
The ecology-driven service (r )evolution 263
of material intensity values for steel production from recycling material

(Schmidt-Bleek & Tischner, 1995, p. 132), resource savings of 69,000 tons of
material, 1,311,000 tons of water, and 69,000 tons of air will be obtained.
The results of reconditioning passen ger cars for InterRegio traveling trains
obtained in another reconditioning plant are likewise remarkable:
Weight per old car: 12 tons (almost 100% of this can be used without modifi-
cation); reconditioning of 1200 cars saving 1200 x 12 t = 14,400 t of new steel
and, thereby,: 94.5 mill. kWh ofenergy (Günther, 1993, p. 256).
7 CONCLUSION
Ecological limitations will become more and more of a bottleneck factor for
economy. Development and production of always new products, as usual up to
now, means wastage of natural resources. The energy necessary for extraction of
raw materials and for production, embodied in the product, cannot be recovered
any more, and recycling of materials requires additional energy and results in
"downcycling" for most ofthem.
Application of the LA aHows to reduce this wastage, and therefore will lead to
increasing of resource efficiency with positive ecological as weH as economical
consequences. The introduction of tbis approach is a big chaHenge for aH groups
involved in the economic system and requires changes in understanding the
processes of production and consumption. To increase the duration of product
use, companies have to establish a reconditioning loop (Figure 1) for
maintenance and upgrading of products, ensuring in this way customer benefit
over a long period without the necessity ofbuying a new product.
~~S
VIRGIN PRI/'IARY ('\
SlI'Pl.Y - - -.... BASE recandlt1anlnl USE - - - . ... DISPOSAL
/'IATERIAl.S 100P"'---J
\
~ SECOHOARY
~loop
racyc11n&
/'IA TERIAl.S"----
Figure 1 Reconditioning Loop versus Recycling Loop (comp. Stabel & Reday-
Mulvey, 1991, p 70)
Application of the LA is possible for products and/or components and provides,

besides the desired ecological efIects, additional economic benefits for companies,
customers, and society.
Broad diffusion and application of the LA may be understood as one important
event besides others, oriented on Sustainable Development as a guiding idea, too.
A lot of future activities are required
(1) to sensitize individuals as members of society
(2) to adapt the frame conditions, based on
(3) revised/modified targets, values, ways of thinking and paradigms, to be
worked out together with scientists of related disciplines such as economics,
social sciences, natural sciences and engineering.
The insight that the quality of life in industrialized countries cannot be in-
creased further by using and consuming more material goods, used as a funda-
mental thesis in a study on the future development of Germany (comp. BUND,
Misereor (Eds.), 1996), may be adopted as a basis for future interdisciplinary
work. On the level of national economy, the effects of LA, resulting in shifting of
"production" jobs towards more "service" jobs have to be identified and consid-
ered in the qualification system. On company level, ongoing research is dealing
with factors influencing the organizational and technical structure of recondi-
tioning.
Increasing the efficiency of resource usage is leading, step by step, to "demat-
erializing" of our economy in the way of using less raw materials and energy
without reduction of prosperity,. This process, which will change the established
structure of economy, is likely to run over some decades.
With a view to the impressing increase in labor productivity achieved in the
industrialized states since the beginning of our century, there is no doubt that the
required increase in resource efficiency will be mastered first by the society of the
industrialized states, which not only dominate the main part of the world
economy but also have to bear the responsibility for this change towards ecology-
oriented economic activities.
8 REFERENCES
Augustin, S. & Hübner, H. (1984), Designing Computer Supported Production

Management Systems using the Aspect-System-Approach, in Hübner, H.
(Ed.): 'Production Management Systems', Amsterdam et al., pp. 51-66.
Austrian Federal Government (Eds.) (1995), Österreich - Nationaler Umwelt-
plan, Wien.
Brinkmann, Th., Ehrenstein, G. & Steinhilper, R. (1994), Umwelt- und
recyclinggerechte Produktentwicklung, WEKA Fachverlag, Augsburg.
BUND & Misereor (Eds.) (1996), ZukunftsfCihiges Deutschland, BirkhCiuser
Verlag, Basel & Berlin.
The ecology-driven service (r)evolution 265
Dieren, W. van (Ed.) (1995), Taking Nature into Account - AReport to the Club
ofRome, Basel.
Gers, V., Hübner, H., Otto, P. & Stiller, H. (1997), Zur Ressourcenproduktivität
von spurgefohrten Hochgeschwindigkeitsverkehrssystemen: Ein Vergleich
von ICE und Transrapid. Wuppertal Papers Nr. 75, June 1997, TWl
(University ofKassel) & Wuppertal Institut.
Grote, A. (1994), 'Grüne Rechnung': c't-magazin, Issue 12/1994, pp. 92-98.
Günter, D. (1993), Recycling - Ansätze beim Umbau von Reisezugwagen, in VDI
(Eds.), 'Recyclinggerechte Produktentwicklung', VDI-Report Nr. 1089,
Düsseldorf.
Hübner, H. (1993): Umweltorientierte Produktplanung: 'Der Weg zum "Lean
Product"': io Management Zeitschrift 62, Nr. 3/1993, pp. 76-79.
Hübner, H. (1996), Jenseits der "Turbo"-Innovation (paper for a seminar of
Wirtschaftskammer Österreich "Neue Technologien: Ausweg aus der
Wegwerfgesellschaft"), Baden/Wien (Austria), 29.02./01.03.1996.
Hübner, H. & Simon-Hübner, D. (1991), Ökologische Qualität von Produkten -
Ein Leitfaden for Unternehmen, Hessisches Umweltministerium (Eds.),
Wiesbaden & TWl (University ofKassel), ISBN 3-89274-061-5.
Keller, M. (1994), 'Kann Natur denn Mode sein?': Die Zeit, No. 16 of April 15,
p.72.
Kreislaufwirtschafts- und Abfallgesetz: Gesetz zur Vermeidung, Verwertung und
Beseitigung von Abfällen, Bonn, 27 Sept., 1994.
Lorenz, K. (1974), Die acht Todsünden der zivilisierten Menschheit, 8th edn.,
Pieper, München.
Petri, H. (1996), 'Verzweiflung, Wut, Rache, Gegengewalt - Zwischen Zukunfts-
angst und Aggression: Kinder und die psychischen Folgen der Umwelt-
belastung': "Die Presse", Wien, Jan. 20.
Schmidt-Bleek, F. (1993), Wieviel Umwelt braucht der Mensch?: MIPS - das
Maß for ökologisches Wirtschaften, Basel et al.
Schmidt-Bleek, F. & Tischner, U. (1995), Produktentwicklung: Nutzen gestalten
- Natur schonen, Vol. 270 of W1FI Publications, Wirtschaftskammer
Österreich, Wien (Austria).
Sporr, V. (1994), Existenzsicherung mit langlebigen Produkten: Strategie und
Finanzierung, diploma thesis, TWI (University ofKassel).
Stabei, W. & Reday-Mulvey, G. (1981), Jobs for tomorrow - The potential for
substituting Manpower for Energy, Vantage Press, New York et al.
Umweltrat (Rat von Sachverständigen :fiir Umweltfragen) (Eds.) (1994),
Umweltgutachten 1994 - Für eine dauerhaft umweltgerechte Entwicklung,
Stuttgart.
Weigmann, G. (1985), Ökologie und Umweltforschung, in Jänicke, M., Simonis,
U.E. & Weigmann, G. (Eds.): 'Wissen für die Umwelt, 17 Wissenschaftler
bilanzieren', Berlin & New York.
World Commission on Environment and Development (Eds.) (1987), Gur
Common Future, Oxford University Press, Oxford &New York.
Wuppertal-Institut (Eds.) (1995), Towards Sustainable Europe, Wuppertal Paper
Nr. 42, 3rd edn., Wuppertal.
ZVEI - Information; Handelsblatt of April 29/30, 1994, p. 19.
9 BIOGRAPHY
Heinz Hübner is head of the Department of Management Science - Technology

Impact & Innovation Research at the University of Kassel/Germany. He assumed
this position after about 10 years in industry, foHowed by an academic career in
Austria, which included appointments at the University of Innsbruck and the
Institute for Advanced Studies in Vienna as weH as research activities in the
International Institute for Applied Systems Analysis (IIASA) in Laxenburg near
Vienna. His main field of interest is the economic, social, and environmental
impact of technological change. He is the author of numerous journal articles and
contributions to coHective volumes and editor of The Art and Science of
Innovation Management (Elsevier, 1986), as weH as co-editor of Innovation
Strategies, Theoretical Approaches - Experiences - Improvements (Elsevier,
1992) and Recent Essentials in Innovation Management and Research
(Gabler, 1995). He is also a member ofthe Editorial Board ofTechnovation.
24
The impact of manufacturing strategy
on the design of production manage-
ment systems: An exploratory study
J Olhager and B. Cimander
Department 01 Production Economics,
Linköping Institute olTechnology
S-58183 Linköping, Sweden
Tel: +46-13-281000 Fax: +46-13-288975
E-mail: jan.olhager@ipe.liu.se
Abstract
This paper deals with the link between manufacturing strategy and the design of
production management systems, from both theoretical and practical perspectives.
We present a framework for relating the manufacturing strategy to the design of
production management systems, based on theoretical approaches in the literature.
The factors that influence the decisions to be made when designing such systems
are identified. Furthermore, we apply the framework to four manufacturing frrms.
The results of this exploratory empirical study indicate the applicability and
usefulness of the concepts in the theoretical framework.
Keywords
Production management, Manufacturing strategy, production management systems
design, exploratory study
1 INTRODUCTION
The strategic development in many industries today is predominantly based on

corporate marketing and fmance decisions at the front with manufacturing being
forced to react to these at the back end of the process. Manufacturing is merely
treated as a support service, not as a full partner in developing the strategy it has to
implement. Often, the result is that manufacturing is unable to successfully support

the corporate strategy. However, it should be recognized that manufacturing can be

used as a competitive weapon, if a strong link is established between strategy,
manufacturing processes and the market place.
Manufacturing enterprises operate in a very dynamic environment. The
requirements of the market place are constantly changing. Firms have to deal with
shifts from make-to-stock to make-to-order, from low cost, more standardized
products to an increasingly fragmented and differentiated market, technologies
which allow flexibility at high volumes, customers willing to wait less and less
time for delivery, etc. The globalization of economic activities and product
markets intensifies many of these forces. Clearly, these pressures and responses
require changes in both the production management systems and the underlying
manufacturing processes. Typical responses are the adaptation of the just-in-time
(JIT) philosophy, implementation of manufacturing resource planning (MRPII)
systems, and the development of OPT-type principles for dealing with limiting
resources (Optimized production tecbnology). All these trends illustrate that
management has realized the importance of combining both methodology and
tecbnology to overcome and take advantage of the increased complexity in order to
expand business.
The purpose and task of production management systems is to support the
manufacturing function of a company in order to achieve its corporate strategy.
The system has to match the requirements of the specific mix of manufacturing
environments the firm faces. Naturally, the needs of the manufacturing function
will vary according to the type of manufacturing process and the products
produced. These needs have to be transformed into the production management
system, thereby setting its requirements and functionality.
Important factors that influence the decision to be made when designing a
production management system are discussed in this paper. It is assumed that the
system design will vary depending upon the distinctive needs of the market place,
in which the company competes. As these needs are captured in the manufacturing
strategy, a linkage between manufacturing strategy and design of the production
management system can be established.
We also present an exploratory empirical study offour Swedish manufacturing
frrms. These companies are all performing weH in their respective businesses and
they represent different manufacturing environments. For each company the
manufacturing strategy, markets, products and processes are described. Then, the
decision variables for the design of production management systems are identified
and the link between manufacturing strategy and system design is evaluated. The
results provide insights into the applicability of the concepts used in the theoretical
framework and their potential usefulness.
The results ofthis paper, in terms offramework and empirical study, should be
of great interest to any manufacturing firm discussing or considering a change in
market direction, manufacturing strategy and/or production management system
design.
Manufacturing strategy and production management systems 269
2 LINKAGE IN THEORY
This section discusses the impact of manufacturing strategy on the design of

production management system (PM systems or PMS). Two approaches found in
literature are described and compared. The following should be kept in mind
(Vollmann, et al., 1992): "There's an important distinction to draw in the process
of matching manufacturing planning and control system design to firm
requirements. The strategy is not the system. The system supports the execution of
the strategy. ... The distinction is important because although the system is quite
general, its use is very individual. Only after clearly understanding the strategy,
the associated set of tasks the system is to perform, and the elements of the system
itself, can the appropriate match be made H.
Berry and HilI (1992) are among the few whom have discussed the link
between system and strategy with reference to PM systems. This paper also
appears in HilI (1994) and Vollmann, et al., (1992) in slightly different versions.
Berry and HilI identify three relevant parts of a PM system, Le. master scheduling,
material planning and shop floor control. Each of these is linked to market and
manufacturing characteristics. At the master level, three approaches are
distinguished: make-to-stock, assemble-to-order and make-to-order. Material
planning can either be rate-based or time-phased, and shop floor control can be
either of MRP/push type or of JIT/pull type. Thus, this framework allows for 12
types of planning systems (3x2x2). In practice, the links between the three levels
may exclude some possibilities.
Bhattacharya and Coleman (1994) aim at identifying the decision variables that
influence the design of the production control. They introduce a tetrahedron to
describe the manufacturing environment in terms of market, product and process
complexity. Market complexity as it pertains to manufacturing deals with
competitive criteria in terms of order winners and order qualifiers, demand
uncertainty, demand stability and volume per period. Product complexity is related
to bill of material levels, options offered and degree of standardization. Routings,
process technologies used and level ofautomation defme the process complexity.
Both approaches identify three main parts of a PM system. Vollmann, et al.,
(1992) call them front-end, engine, and back-end. Bhattacharya and Coleman
(1994) refer to them as "phases", emphasizing that the design of a production
management system is an iterative process rather than a standardized set of yes-or-
no decisions. In the following, the latter approach is described in some detail as a
basis for the case discussions. This is more detailed with respect to factors
considered at various planning levels and is therefore used in the investigation of
the linkage in practice.
The issues that are related to the planning levels above are summarized in
Table 1, outlining the decision variables for system design. It also describes the
link to the manufacturing environment and strategy in terms of market, product
and process complexity.
Table 1 Linkage between manufacturing strategy and production management

system design. (based on Bhattacharya and Coleman, 1994)
Manufacturing environment levels

Market complexity low B high
Product complexity low B high
Process complexity low B high
PMS decision variables levels

Phase 1: Long-term planning
UsageofPMS one for all B one per product
products group
Order penetration point MTS ATO MTO
Forecast accuracy high B low
Production plan policy level B chase
Phase 2: Medium-term planning
Material plan rate-based B time-phased
Material planning low detail B detailed
Capacity planning low detail B detailed
Stability high B low
Phase 3: Short-term planning
Basedon JIT/pull B MRP/push
Importance of capacity utilization high B low
Trackinglmonitoringlexpediting low B high
Linkage to phase 2 & I low B high
WIP inventory low B high
Some of the level directions in Bhattacharya and Coleman (1994) have been
rearranged to facilitate the identification of matches or mismatches between
manufacturing strategy and design issues. For example, if market, product and
process characteristics all have low complexity, the choice would typically be a
make-to-stock (MTS), rate-based and JIT/pull system, focusing on the left hand
side of the decision variable levels. If the manufacturing environment is highly
complex, on the other hand, the system would most likely be make-to-order
(MTO), time-phased and MRP/push, resulting in a profile at the right hand side of
the spectrum. Assemble-to-order (ATO) situations mean that the order penetration
point, i.e. the point where the product is linked to a specific customer order, splits
the manufacturing process into two parts. The part before or upstream the order
penetration point is basically make-to-stock manufacturing, whereas the latter part
or downstream is make-to-order. This and other aspects on the positioning of the
order penetration point are treated in Olhager (1994).
3 LINKAGE IN PRACTICE
A questionnaire was developed with mainly open-end questions, concerned with

market, product and manufacturing characteristics as weIl as PM system
functionality and systems design process; details are found in Cimander (1995).
Open-end questions were employed to determine how people were thinking and to
stimulate critical evaluation and discussion. The managers interviewed in this
sampie have all been involved in the system design and implementation process.
Even though none participated in strategy formulation, all are familiar with the
companies' markets and the production processes, holding positions such as
system manager, IT manager and production manager.
Four Swedish companies were chosen for this study. The criteria for selection
was (i) the assumption that these companies were quite thorough when designing a
PM system rather than selecting a standard system, and (ii) that all companies are
performing weIl in their businesses. Also, these companies manufacture totally
different products to totally different market. No similarities whether in size,
volume, or characteristics can be noticed. Rather, they represent four different
types of manufacturing environments. Product characteristics are shown in Table
2, indicating that product complexity ranges from low to very high. "Product
complexity" serves as an aggregate complexity indicator. The process structures
also differ greatly in terms of complexity. Production process structure
characteristics related to complexity are shown in Table 3, where "process
complexity" serves as an aggregate indicator. The individual relative, scaled
measures such as low-medium-high were evaluated by each respective company
and compared and positioned by the authors.
Table 2 Summary of frrms' product characteristics.
Firm A B C D
Product lines many few one Few
Final product variety low high medium Low
Individual product high medium very low high
volumes
End-product maturity medium to high low medium to
high high
End product complexity lowto medium very high medium
medium to high
BOM levels few many verymany medium
Product complexity low high very high low
Table3 Summary of fmns' process characteristics.
Firm A B C D
Type of production process, batch, flow project, small batch, flow
linked batch shops batches lines
Level of mechanization high medium medium medium to
high
Product routings rigid medium to flexible medium to
flexible rigid
Level of operations high medium low medium to
interconnection high
Process complexity low medium very high medium
3.1 Firm A: Pharmaceuticals
Firm A is a multinational pharmaceutical company serving the global market. The

main strategic goal is to maintain a steady growth, by continuously providing the
market new and more effective products, relying on effective R&D. The market
demand stability is relatively high. Seasonal fluctuations occur, but are rather
predictable. The market is considered of medium complexity. Many different
product lines are produced in high volume and limited end product variety. Few
BOM levels are needed; more or less simple mixture recipes are used. The product
line complexity is considered low. Two quality dimensions dominate: the product
must be an "effective medicine" and the product must be of 100% purity and
conformance to the formula. The frrst is a matter for research and development,
and the second a manufacturing issue. Also, delivery speed is identified as an order
qualifier.
Firm A has a manufacturing strategy, however not weil formulated. It aims at
achieving superior quality, fostering delivery speed and increasing efficiency. The
main manufacturing challenge is to keep pace with its yearly growth of more than
20%, market share increases and the introduction of new product lines. The
production process is highly automated with one production line for every product
line, run as a linked batch process. The production system is complex in terms of
know-how, automation, integration, and regulation, but simple in terms ofrouting
options. The impact of marketing on manufacturing is that the output rate of the
production lines has to increase and/or that new lines have to be set up.
Firm A produce fmished goods on a make-to-stock basis. The products are
distributed through warehouses and distributors to the customers. Forecasting
accuracy should be a matter of importance, but in fact it is not. Due to the rapid
growth of business, only the total annual output is determined. Medium-term
planning is simplified due to the low process complexity. The end products leave
the production line at a certain rate. Much latitude is left to the shop floor
managers by providing support through the system but leaving the decisions to the
front-line supervisors. Firm A expects to decentralize planning and control even
further, emphasizing a belief in the capabilities of each individual. An MRP
approach is used for shop floor scheduling and control. The degree of tracking and
monitoring is high. As cost is of subordinate importance, capacity utilization
becomes secondary. Batch sizes and WIP inventory are being reduced, subject to
continuous improvement programs.
3.2 Firm B: Fork liften
Firm B manufactures fork Iifters for indoor use. The product range includes smalI,
hand-pushed Iifters as weil as large forklift trucks. They are represented worldwide
through a sales organization. They are steadily increasing their market share. The
market is mature, limiting product innovations to ergonomic improvements. The
order winners are superior delivery lead times in combination with customization
flexibility. Demand uncertainty is very high, creating a rather high market
complexity. Firm B offers four product lines. Fork Iifters are complex products; an
assembly of many components. Also, one product line has more than a thousand
end-product variety possibilities. The product line complexity is considered high,
even considering the modular and parametric design.
An explicitly stated manufacturing strategy does not exist, but the overall
strategic plan specifies the goals for the functional areas. Only the manufacturing
director participates in the formulation process. The competitive criteria are
identified (i.e., delivery lead-time, quality, cost), but highly aggregated and not
specified for the decision areas. Firm B produces in batch mode, striving for an
increasing degree of flow orientation. Final assembly is manual, whereas parts
manufacturing (fork, chassis, etc.) is highly mechanized, e.g. using FMS's in
manufacturing cells.
Firm B uses an assemble-to-order approach. Due to the thousands of end-item
options, forecasting accuracy is difficult to achieve. Consequently, achase strategy
is followed. The planning of the material flow through the plant is very detailed.
Quantities and dates for each component and subassembly are specified, due to the
relatively high product and process complexity. The capacity planning is also very
detailed, and the material planning approach is time-phased. Still, planning is to a
large extent decentralized, but the next system is expected to be very detailed and
centralized. A pure MRP approach is pursued. The degree of tracking and
monitoring is high. Batch sizes and WIP .inventory are being reduced since 1989,
when a lean production program was launched.
3.3 Firm C: Aireraft
Firm C is a high-tech company in the aircraft industry. Tbe military division

manufactures a modem multi-role combat fighter. Tbe market is of very low
complexity. Agreements on the number of planes and due-dates are long-term.
However, the market for spare-parts is highly unpredictable. Technical support and
after-sales support are important activities. Firm C only builds one type of airplane
and the output rate is low. Prototypes are built, tests are performed and the latest
technology is integrated into each new fighter. Tbe product complexity is
considered to be extremely high.
A manufacturing strategy is not defmed. Firm C is about to start exporting and
expects that the plane will be very competitive on the international market at least
with respect to price. Tbe project type production system is flexible in terms of
production volume, product mix, machine, process and routing. Many different
manufacturing technologies are used, creating a very complex process.
Firm C is a make-to-order company, but may at a later stage in the product life
cycle shift towards assemble-to-order. Tbe orders for the next decade are known.
Tbus, forecast "accuracy" is high. However, the bill of material is continuously
subject to changes and modifications, and spare parts demand is uncertain.
Material and capacity plans are very detailed, time-phased and centralized. Tbe
MRP/push approach is used for shop floor control. Tracking and monitoring of
manufacturing orders is more important than capacity utilization. WIP inventory is
related to the manufacturing lead-time in this one-of-a-kind project type of
production and held at a medium level.
3.4 Firm D: Mierowave ovens
Firm D manufactures microwave ovens for the world market. Tbey focus on
superior technical features, whereas most competitors pursue a low cost strategy.
Tbe market share worldwide is steadily increasing. Tbe market requires product
modifications every two to four years. Firm D is considered a prospector in the
introduction of new features, justifying a higher price. Particular country-specific
features, such as knobs, buttons and space design, have to be taken into account.
Demand stability is high; seasonal fluctuations are negligible. Tbe market
complexity is considered low. Two major product lines account for 80-90 % of the
total output. Tbe product variety is low, the basic difference being color. Tbe end-
product complexity is medium, as is the number of BOM levels. Tbus, the product
line complexity is considered low.
Firm D does not explicitly state a manufacturing strategy. Microwave ovens are
manufactured in batch and flow lines. Due to frequent model changes, production
processes have to be flexible, explaining the high degree of manual operations.
Still, the overall level of mechanization is considered to be medium to high.
Firm D produces to stock. Forecasting is concemed with annual volumes. The

approach to detailed material planning is a combination of time-phased and rate-
based. Final assembly and some subassemblies are rate-based, whereas all other
production areas are time-phased. Planning is centralized. Firm D uses a hybrid
MRPlKanban approach, considered a just-in-time system. 60% of the purchase
orders are delivered just-in-time, and some directly to the point of usage. Fax
machines are used on the shop floor for material ordering and call-offs. All these
transactions are still planned and monitored by the MRP system. Aiming at
becoming a world-class manufacturer, firm D performs "best practice"
comparisons. Processes, operations, systems and structures are compared and
evaluated worldwide, and then the "best" method found is implemented in all
plants.
4 SUMMARY ANDCOMPARISONS
Not one of these four companies has a written statement about the manufacturing
strategy. Still, all companies are performing weIl. They have employed production
processes that correspond weIl to market characteristics. Formalized procedures
could not be found, neither for analyzing the market dimension nor for choosing a
production process. None of the companies has performed an assessment of the
manufacturing function and determined the particular manufacturing tasks. Thus,
system design decisions were taken by intuition and insight rather than by structure
and systematic analysis of the market-manufacturing interface. All four companies
seem to have process structures that correspond weIl with the product and market
characteristics. The companies are continuously improving the processes and the
correspondence to the market requirements.
The characteristics of the production management systems are summarized in
Table 4. The corresponding firm letter marks the level for each company. If a letter
is missing, the position could not be evaluated.
The table clearly indicates the range of manufacturing environments and the
range of system designs. Firms A and D have similar system environments.
Accordingly, the decision variable profiles for the production management systems
show similarities, although firm D is located more to the middle because of the
mix of rate-based and time-phased planning. Firm C has a particular one-of-a-kind,
project type of production, explaining the scattered profile. With an assemble-to-
order approach, mixing MTS and MTO approaches, firm B takes an intermediate
position. Low product and market complexity, level production plan, and high
medium-term plan stability at fmns A and D suggest that a further move towards a
JIT/pull system and decentralized monitoring would be possible as indicated by
their profiles in Table 4.
Table 4 Firms' profiles regarding the link between manufacturing strategy and
PMS design variables.
Manufacturing environment +- levels ~
Market complexity (low - high) C D A B

Product complexity (low - high) AD B C
Process complexity (low - high) A BD C
PMS decision variables +- levels ~
Phase J: Long-term planning

Usage ofPMS (same - different) ABCD
Order penetration point (MTS - ATO - MTO) AD B C
Forecast accuracy (high -low) C AD B
Production plan policy (level- chase) AD B
Phase 2: Medium-term planning
Material plan (rate-based - time-phased) ACB D
Material planning (low detail - detailed) A D BC
Capacity planning (low detail - detailed) A D BC
Stability (high - low) CAD B
Phase 3: Short-term planning
Based on (pull - push) DB AC
Importance of capacity utilization (high -low) A CBD
Tracking/monitoring/expediting (low - high) DB AC
Linkage to phase 2 & 1 (low - high) DB AC
WIP inventory (low - high) B ADC
The backgrounds to and motives for the design of production management

systems are manifold. A new organization form in one frrm resulted in a new
production management system. The international sales organization in another
frrm suggested that an MRPII system be implemented in order to reduce the
delivery lead times. Two years later, the same frrm started a lean production
program, which resulted in far-going modifications of the newly installed MRPII
system.
All production management systems are primarily MRP-based, due to some
complexity in the manufacturing environment. For firm B, MRP is utilized as a
tool to rapidly transform individual customer orders into shop floor orders, which
are then scheduled and released. For frrms A and C, the MRP system also supports
process documentation, which is essential for product quality and reliability
reasons. Firm D is moving towards a nT system.
Using the Berry and Hill (1992) framework, focusing on MTS, ATO or MTO
approaches to master planning, rate-based or time-phased detailed material
planning and nT/pull or MRP/push for shop floor control, would indicate a similar
type of fit between strategy and system for the four companies. However, the
framework used here provides a few more PMS decision variables.
All systems seem to perform well, designed for the particular manufacturing
tasks and productlprocess constraints. Still, some inconsistencies could be
identified between the system environment and the individual design decisions as
well as between different elements of the system. Then, it is important to analyze
the extent of and reasons for such inconsistencies. The system designers reported
that they thought they knew the manufacturing process and the corresponding
system characteristics that would best support the market, even though a
systematic assessment of the manufacturing strategy was not undertaken.
5 CONCLUSIONS
The design decisions made by the four companies in this study seem to be captured
well by the approach in Bhattacharya and Coleman (1994). This approach proved
to be useful in practice, providing the managers of the participating frrms with a
comprehensive insight into the system structures and an understanding of some
factors that influence the system design decisions. Some level directions (see Table
1 and 4), were rearranged to facilitate a systematic evaluation ofthe consistency of
the system design. The market, product and process complexities indicate the
functional requirements and the possible simplicity level of the PM system. Yet,
special manufacturing environments may show a scattered profile. Then, a further
analysis is needed to provide answers as to why the system is designed in such a
way or if the system actually can and should be redesigned. Also, if the system
includes a mix of push and pull short-term planning and/or a mix of rate-based and
time-phased medium-term planning, it is not possible to clearly illustrate these
combinations and links in the existing frameworks.
No company had a well formulated manufacturing strategy. Still, the match
between on the one hand market, product and process characteristics and on the
other the production management system was quite good. Thus, the ways in which
the dimensions relevant to the manufacturing strategy are taken into consideration
is of decisive importance, rather than the actual formulation of a manufacturing
strategy. Still, formalized procedures and a clear statement of the manufacturing
strategy would be beneficial in order to minimize the number of inconsistencies
between the manufacturing task and the production management system design.
In summary, a model for linking manufacturing strategy to the design of
production management system is needed and welcomed by manufacturing frrms.
However, there is a lack of research in this field. The results of this study suggest
that the approaches discussed here need further refmement in order to truly support
the design phase from a manufacturing strategy point ofview. Such enhancements
and the development of new models, approaches and frameworks are vital topics
for further research.
6 ACKNOWLEDGEMENT
The research is supported by grant from the Volvo Research Foundation and the
Volvo Educational Foundation.
7 REFERENCES
Berry, W.L. & Hill, T. (1992), Linking systems to strategy. International Journal
ofOperations and Production Management, 12(10), pp. 3-15.
Bhattacharya, A.K. & Coleman, J.L. (1994), Linking manufacturing strategy to the
design of a customized hybrid production control system. Computer Integrated
Manufacturing Systems, 7(2), pp. 134-141.
Cimander, B. (1995), The impact of manufacturing strategy on the design of
manufacturing planning and control systems. Research Report No. /31,
Department ofProduction Economics, Linköping Institute ofTechnology.
Hill, T. (1994), Manufacturing strategy: text and cases (2 nd Ed.), Irwin, IL.
Olhager, J. (1994), On the positioning of the customer order decoupling point, in
'Proceedings of the 1994 Pacific Conference on Manufacturing', Jakarta,
pp. 1093-1100.
Vollmann, T.E., Berry, W.L. & Whybark, D.C. (1992). Manufacturing Planning
and Control Systems (3 rd Ed.), Irwin, IL.
8 BIOGRAPHY
Jan Olhager is Associate Professor at the Department of Production Economics,

Linköping Institute of Technology. He received a Master of Engineering from
University of California at Berkeley and a Ph.D. from Linköping Institute of
Technology. He has authored a book on rnanufacturing planning and control. He
has published in international journals such as European Journal of Operational
Research, International Journal of Operations and Production Management,
International Journal of Production Economics, International Journal of Production
Research and International Transactions in Operational Research. His research
interests include manufacturing strategy, manufacturing planning and control,
flexibility, and rnodelling and analysis ofproduction management systems.
Berthold Cimander was a Visiting Researcher at the Department of Production

Economics, Linköping Institute of Technology in 1995, on leave from Universität
Hamburg.
25
Selection of assembly system
configurations: Adecision support
system
A. K. Kochhar
Department of Mechanical Engineering
UM/ST, Manchester M60 1 QD, United Kingdom
Tel: +44-161-200-3801 Fax: +44-161-200-8721
Email: mcjmscc@fs1.me.umist.ac.uk
Y. T. Abdul-Hamid
University of Bradford, Bradford, United Kingdom
Abstract
Design of competitive and effective manufacturing and assembly systems has to
take account of a large number of technical, human and economic parameters.
Frequently this information is not readily available to the system designers. This
paper describes the systemization of knowledge relating to the large number of
technical and human parameters which can affect the choice of automated
dedicated and automated programmable assembly systems. D~cision trees and
production rules are used to link the different parameters. The structured
knowledge, in the form of a prototype decision support system, has been validated
using a number of case studies.
Keywords
Assembly system, Decision Trees, Manufacturing, Structured Knowledge
1 INTRODUCTION
The very highly competitive world-wide market environment is forcing many

manufacturing companies to reorganise their manufacturing operations in order to
eliminate inefficiencies and non value adding activities. Business process re-
engineering techniques are being used, amongst other things, for the simplification
and redesign of manufacturing systems. An important aspect of redesign is the
choice of the type of manufacturing system to be used. It is necessary to take
careful account of aJl the related factors before deciding on the suitability of a
particular type of manufacturing plant configuration in a given situation. The
problem, which faces the decision maker, is the vast amount of information which
© 19981FIP. Published by Chapman & Hall
should be taken into aceount when making the ehoiee of manufacturing system
eonfigurations. It is not possible to find a single source covering the requirements
for any one type of assembly system.
This paper describes the systematization of knowledge relating to the large
number of parameters which ean affect the choice of assembly systems. The
systemized knowledge has been incorporated in a prototype decision support
system. For illustration purposes two main types of assembly systems, namely
automated dedieated, and automated programmable, are considered. The successful
application of each type of assembly system requires the consideration of a number
of teehnical and human factors.
2 THE STRUCTURE OF THE KNOWLEDGE
The knowledge has been structured in the form of two integrated decision trees:
1- Conditions for applying automatic assembly systems,
2- Conditions for applying programmable assembly systems.
These decision trees have been structured in the form of production rules. The
main rule for each type consists of the main (or high level) eonditions required to
satisfy the goal, which is to assess the suitability of the successful implementation
of a given type of assembly configuration in the environment under consideration.
Eaeh of the main conditions has its own sub-conditions, and sometimes sub-sub
conditions. The objective of this systemization of knowledge, in the form of
eonditions and sub-conditions, is to simplify the process of assessing the areas on
which attention should be focused.
3 TECHNICAL AND HUMAN CONDITIONS OF DEDICATED

AUTOMATIC ASSEMBLY SYSTEMS
Dedicated automatic assembly systems are special design eonfigurations, usually

one of a kind. They may be partially constructed of standard components, but the
total machine is unique to the product being assembled (Lynch 1976). The
assembly cycle time in these systems is typically one to four seconds (Warnecke
1978). A dedicated assembly system should satisfy eight main conditions. Brief
descriptions of the main conditions and their sub-conditions now follow.
3.1 Design for assembly
Design for assembly (DFA) is one of the most important conditions for the
suceessful implementation of any assembly system, and it is particularly important
in the automatie and prograrnmable assembly systems. Nine sub-conditions are
included here. The eonditions related to the design of the product include:
Minimization of the total number of separate parts in the product (Bailey 1986,
Boothroyd et a1 1982, Holbrook et al 1988); use of modular subassemblies for
assembling the produet, where each subassembly can be assembled, tested, and
transferred separately (Boothroyd et al 1982, Holbrook et al 1988, Laszcz 1985,
Riley 1983, Stoll 1986); the provision of a suitable base part or main body in the
Selection 0/ assembly system configurations 281
design of the produet (Boothroyd et al 1982, Stoll 1986, Tipping 1969, Treer
1979); and, minimization of the number of assembly direetions (preferably earrying
out the assembly proeess out from the top direetion only) (Boothroyd et al 1982,
Holbrook et al 1988, Laszez 1985, Stoll 1986, Tipping 1969, Treer 1979). The
eonditions related to the design of the individual parts inc1ude: designing the parts
in such a way that they ean be fed easily and reliably by the meehanieal parts feeder
and its attaehments (Bailey 1986, Boothroyd et al 1982, Holbrook et al 1988,
Laszez 1985, Riley 1983, Stoll 1986, Tipping 1969, Treer 1979); designing the
parts to be multi-funetional, i.e. they ean perform more than one funetion in the
assembled produet (Stoll 1986); designing the parts for multi-use, so that they ean
be used in many different produets (Stoll 1986); the provision of eomplianee
features, to faeilitate the assembly of the parts (Bailey 1986, Boothroyd et al 1982,
Holbrook et al 1988, Laszez 1985, Stoll 1986, Treer 1979); and, designing the
parts for ease of gripping by providing a large, flat, smooth top surfaee for vaeuum
or magnetie gripping, or by providing appropriate holes, slots, or tabs to aid
grasping by meehanieal grippers (Bailey 1986, Laszez 1985, Stoll 1986).
3.2 Automatie assembly workheads
These deviees earry out the required assembly task by plaeing and joining apart
with the base part, or with other parts in the assembly. Three sub-eonditions are
inc1uded here to ensure the reliability and safety of the assembly system. These are:
ensuring that jammed parts ean be c1eared quiekly from the workheads, in order to
avoid long de1ays in produetion (Tipping 1969, Wiek et al 1987); the fail safe
operation of workheads, i.e. should any failure oeeur, the workhead and maehine or
tooling must not be damaged (Tipping 1969, Wiek et al 1987); and, ease of
maintenanee of the workheads, (Wiek et al 1987).
3.3 Parts presentation and feeding
The third main eondition is the provision of appropriate, effieient, and re1iable
equipment to feed and present the parts to the assembly workheads. The supply of
parts in magazines is the most effieient and reliable method of presenting parts to
the workheads. Hopper feeders are sometimes used for filling the magazines, but in
many eases they are manually loaded. This manual intervention leads to higher
assembly eosts. Therefore, only one of the following reasons justifies using this
method. These are: the parts are eomplex or very sensitive to be stored in bulk
(Riley 1983, Wiek et al 1987); the parts are very diffieult to be fed down a
meehanical parts feeder track individually (Riley 1983, Tipping 1969, Wiek et al
1987); or, the parts can be purehased in magazines or strips forms (Treer 1979,
Wiek et al 1987). When the parts cannot be provided by magazines, then the
seeond method is to feed them by meehanieal parts feeders. Many eonditions are
required to implement this method sueeessfully. These inc1ude: the seleetion of
suitable feeders, whieh satisfy the requirements of the assembly system (Boothroyd
et al 1982, Riley 1983, Tipping 1969, Treer 1979, Lotter 1989, Cokayne 1991,
Aronson 1995); the se1ection of suitable discharge rails (tracks), whieh perform the
funetions of arranged storage and transfer of the parts from the feeder «Boothroyd
et al 1982, Tipping 1969, Lotter 1989, Cokayne 1991); the provision of a statie
removal point for the parts eoming from the track, to enable the assembly workhead
to pick the parts from the same point every time (Lotter 1989, Cokayne 1991); and,
the provision of a separating device, to enable the assembly workhead to pick a
single part each time (Wick et al 1987, Lotter 1989).
3.4 Emdent control system
An important condition in the operation of automatic assembly systems is the

provision of an efficient control system. The main lower level conditions are: the
ability to supervise all the necessary checking operations in the assembly system
(The Institution of Production Engineers 1979, Wick et al 1987, Aronson 1995);
the provision of a "count-and-stop" facility in the control system (Treer 1979); the
provision of a memory system (Aronson 1995, Hollingum 1993); the provision of
lockout features on assembly stations (Treer 1979, Butler 1993); the ability to
control the movement of each assembly workhead (Treer 1979); the provision of
indicator panels to display what is happening to the assembly machine (Aronson
1995, Butler 1993, Hollingum 1993); recording the assembly system performance,
such as machine total cycIes, good parts produced, and malfunctions at each
station (Butler 1993, Hollingum 1993); and, the ability to interface with other
controllers and computers (Treer 1979, Wiek et al 1987, Butler 1993).
3.5 Assembly system architecture
The overall architecture of the assembly system has a significant impact on its day
to day operation. A number of measures can be used to assess the quality and
suitability of the architecture. This condition consists of several sub-conditions,
such as: the provision of free spaces between the individual stations (The
Institution of Production Engineers 1979, Lotter 1989, Butler 1993, Hollingum
1993, Morach 1988); integrating checking stations in the line (Wick et al 1987,
Lotter 1989, Butler 1993, Morach 1988, Astrop 1980, Weimer 1988, Schwartz
1989); careful design of the workpiece carriers (Lotter 1989, Kochan 1990, Rooks
1989); careful integration of any manual workstation required in the system (Lotter
1989, Aronson 1995, Astrop 1980, Seitz 1990, Rooks 1989); minimising the
frequency of misfed parts, (Tipping 1969); careful integration of any special
processes (such as welding, machining, and adhesive bonding) into the assembly
system (Treer 1979, Wick et al 1987, Morach 1988); and, the provision of off-li ne
repair loops for defective assemblies (Astrop 1980, Schwartz 1989).
3.6 Quick rectification of faults
Since any breakdowns result in an increase in the assembly costs in dedicated

automatic assembly systems, the breakdowns must be rectified quickly. The main
sub-conditions are: easy locaI access to the fault areas line (Boothroyd et al 1982,
Lotter 1989, Aronson 1995, Butler 1993); the provision of opticaI and acoustic
signalling of the fault point (Boothroyd et al 1982, Lotter 1989, Butler 1993); the
local availability of maintenance personnel at stations with high number of faults
(Lotter 1989); implementation of a suitable maintenance strategy to improve the
availability of single elements of the system (workheads, feeders, etc.) (Hollingum
1992, Wiendahl et al 1983); and, the provision of a fault recording system which
Selection 0/ assembly system configurations 283
keeps arecord of the maintenance history of each piece of equipment in the system
(Wiendahl 1983).
3.7 Day to day operation
This condition is concemed with the human factors in the assembly system, i.e.
organizing the personnel activities in the plant to TUn and maintain the system
effectively. Main sub-conditions are: clear definitions of personnel activities and
responsibilities (Treer 1979, Lotter 1989, Rooks 1989); organizing the operators to
maintain the required quantity ofparts in the feeding system (Tipping, 1969, Lotter
1989, Astrop 1980); training the staff about the operation and maintenance of the
system (Tipping 1969, Treer 1979, Wick et al 1987, Lotter 1989, Astrop 1980,
Rooks 1989); and, providing operators and maintenance staff with all the necessary
instructions (Davis 1993).
3.8 System safety
Safety measures need to be organised so as to give preference to the following

procedural order: personnei, assembly machines, peripheral machinery, and then
workpieces and tooling. Many sub-conditions can be included here, such as: the
provision of machine safeguards to prevent any access to hazard points in machines
during their operation (Wick et al 1987, Aronson 1995, Davis 1993); covering a11
moving parts which may engage the operator shielding of operators from spray,
chip, and broken tools ejection; fail safe movement of parts (in the assembly
machine) without injuring the operators; clear display of emergency procedures; the
provision of fail-safe interlocks on the assembly machines; guarding the controls to
avoid accidental activation of the assembly; easy access (by the operators) to the
assembly system emergency stop buttons; application of measures to reduce noise
levels to the acceptable perrnissible limits; and, ensuring that the machines cannot
be operated during maintenance (Wiek et al 1987).
4 TECHNICAL AND HUMAN CONDITIONS OF PROGRAMMABLE

AUTOMATIC ASSEMBLY SYSTEMS
The general trend, in the industrial countries, towards the manufacture and
assembly of small volumes of different products, with short life-cycle, and high
quality has led to the increasing use of programmable assembly (Arnstrom et al
1988). Programmable assembly has many features which satisfy the above
requirements. These include the ability to re-program the assembler to
accommodate product design changes, the possibility of assembling a different
product every shift (pro vi ding the changeover time between different batches is
short), and the ability to rapidly accommodate various styles of the same product
(Boothroyd 1984, Miles 1985). So valuable are these advantages of programmable
assembly systems that their higher capital cost can often be justified even for low
volumes (Little et al 1993). The programmable assembly decision tree includes
eight main conditions.
284 Pan Five Strategie Aspeets
4.1 Design for programmable assembly
All the design for assembly conditions for dedicated automatic assembly, discussed
in the previous section, apply equally to programmable assembly.
4.2 Technical ability of assembly robots
The provision of robots with the required technical abilities, to perform the
assembly tasks, is the second main condition. Therefore, they should have the
ability to do this work, in the required cycle time, and in accordance with all other
factors in the assembly process such as the tolerances between the parts, the weight
of the parts, and the layout of the assembly workplace (Owen 1984, Rees et al
1987, Lotter 1986, Eshleman et al 1983, Delchambre 1992, Booth et al 1992,
Nicholson 1986, Mayer 1988). Other requirements include enough degrees of
freedom to perform all the required assembly tasks (Owen 1984, Rees et al 1987,
Delchambre 1992); suitable control devices (Owen 1984, Nicholson 1986,
Hollingum 1992, Ohashi et al 1994); and the necessary insertion force (Nicholson
1986).
4.3 Parts presentation and feeding
This main condition as weil as the associated sub-conditions are the same for both
dedicated automatic and programmable assembly systems.
4.4 Efficient control system
Clearly the sub-conditions in automatic assembly systems are equally applicable

here also. An additional sub-condition is: the control system has a decentralised
and modular structure to allow for each assembly station to be programmed and
debugged independently and to allow for future changes in the assembly system
(Aronson 1995, Owen 1984, Mayer 1988, Hollingum 1992).
4.5 Assembly system architecture
This condition is about the overall design structure of the assembly system. The
main sub-conditions are: providing volume growth flexibility in the system to meet
the future demand increases in the assembled products (Hemmingson 1988,
Fabricius 1985, Billatos 1988, Aregger 1989); providing design changes flexibility
in the system (Owen 1984, Billatos 1988, Andreasen 1986); the use of standard
equipment, as much as possible, in building the assembly system (Ohashi et al
1994); application of measures to reduce the changing of grippers required to carry
out the assembly operations (Hollingum 1992, Pham et al 1991); and, minimizing
the number ofprogramming languages (Mayer 1988).
4.6 Quick rectitication of faults

Selection 01 assembly system configurations 285
The conditions applicable to dedicated assembly systems are equally applicable

here. In addition, two other conditions can be included here: ensuring that the
robots used in the system are highly re1iable (Engelberger 1980); and, the provision
of diagnosis aids for the assembly robots (Owen 1984).
4.7 Education and training
Proper training, before and after a robotic assembly system installation, is an

important factor in the effective use of the system. Almost everybody in the plant
will need some sort of training. A training strategy should include: conducting a
'skills assessment' to determine the current level of expertise available in the plant;
completing the basic skill training required in the system (Rosato 1986); and,
conducting training programmes for all the system staff, to ensure the proper
operation and maintenance of the system (Hollingum 1992, Osborne 1986, Singrey
1988, Ziskovsky 1984).
4.8 System safety
In addition to the sub-conditions of safety in dedicated assembly systems, the

following sub-conditions are included here: shie1ding solid-state e1ectronic devices
(for controlling the robot) from potential radio frequency interference; ensuring the
presence of a second person during the execution of any programming or
maintenance work; placing a visible amber light near the robot; limited robot speed
during teaching and testing of robot programs; and, the provision of an overload
protection device on the robot end-effector (Wick et al 1987).
5 APPLICATION OF THE SYSTEMIZED KNOWLEDGE
The knowledge has been structured in the form of adecision support system, in
which the knowledge is represented as production rules. The conditions (and sub-
conditions) of the knowledge are presented to the user in the form of questions with
an appropriate explanation for every question. The possible answers are: (Y es),
(No), and (Unknown). The (Unknown) answer leads the user to the lower level sub-
conditions of the main condition.
After extracting the answers to the conditions from the user, the decision
support system advises the user about the suitability of the assembly system and the
technical and human factors which have not been satisfied. The knowledge has
been validated by using two methods: published case studies; and, industrial data.
For each type of assembly, the main conditions in the decision tree have been
compared with what is actually applied in five published case studies. This
comparison has shown a great deal of similarity between the structured knowledge
and the actual applications. In the second method, practical industrial data relating
to the main conditions and sub-conditions (in the form of questions) have been
used. The resulting output from the knowledge based system has demonstrated the
validity, suitability and correctness of the structured knowledge.
In one case, the practical data relating to an existing dedicated assembly line
was obtained from an industrial company. The data re1ating to individual
eonditions are summarised in Table I. It should be noted that eondition Cl

eorresponds to Seetion 3.l of this paper; eondition C2 eorresponds to Seetion 3.2
of this paper, and so on. Where the answer to a top level eondition is unknown,
further questions are asked at the next lower level of the decision tree, for example
C2.1, C2.2, to establish whether or not the condition at the previous, higher level is
satisfied. Charaeters D and E, next to eaeh eondition, indieate whether the
partieular eondition is desirable, or essential.
It ean be seen from Table I that all the essential eonditions have been
implemented in the plant. The higher level questions of eonditions Cl, C3, C4, C7
and C8, have been answered positively. The answers to the higher level questions
of eonditions C2 and C3 were 'Unknown' and therefore their lower level
questions have been asked. All the essential sub-eonditions of these two main
eonditions have been answered positively. The sub-eonditions of the desirable sub-
eondition C2.3 were also implemented. Therefore, C2 has a positive answer, as all
its elements (sub-eonditions) have been implemented in the plant. Two desirable
sub-eonditions of CS have positive answers, two have negative answers, and only
one with an 'Unknown' answer. The sub-eonditions with negative answers are: CS.8
Table I Data for a praetieal automatie assembly system
Conditions Answers
Cl Applying design for automatie assembly principles (E) Yes

C2 The provision of efficient and reliable assembly worlffieads (E) Unknown
C2.1 Jammed parts can be c1eared quickly from the workheads (E) Yes
C2.2 Workheads fail safe (E) Yes
C2.3 Ease of maintenanee of the workheads (0) Unknown
C2.3.1 Ease of access to any item which fails regularly (0) Yes
C2.3.2 Providing spaees between the workheads (0) Yes
C2.3.3 Providing off the shelf spare parts to the workheads (0) Yes
C3 Efficient equipment to feed and present the parts (E) Yes
C4 The provision of an efficient control system (E) Yes
CS Careful design of the overall assembly system strueture (E) Unknown
CS.I Adequate free space between individual stations (E) Yes
CS.2 Suitable length of the discharge rail (track) (0) Yes
CS.3 Checking stations are integrated in the line (E) Yes
CS.4 Avoiding rigid combination of assembly machines (0) Yes
CS.S Avoiding rearrangement of preassembled parts (0) Unknown
CS.6 Careful design for the workpiece carriers (E) Yes
CS.7 Careful integration of any manual workstations (E) Yes
CS.8 Attention to the problem of misfed parts (0) No
CS.9 Careful integration of any special process (E) Yes
CS.IO The provision of off-Iine repairs loops (0) No
C6 Applying precautionary measures to rectify faults quickly (0) Unknown
C6.1 Easy local access to the fault areas (0) No
C6.2 Optical and acoustic signalling of the fault point (0) No
C6.3 Arranging the work point ofthe maintenanee personnel (0) Unknown
C7 Organizing personnel activities in the plant (E) Yes
C8 Safety considerations in the system (E) Yes
Selection of assembly system configurations 287
(attention to the problem of misfed parts) and C5.10 (the provision of off-line
repair loops). Because al1 the essential sub-conditions of C5 have been satisfied,
then it is considered to be positively applied in the plant. There is one desirable
main condition in the decision support system, and it has not been applied in the
plant. It is C6 - applying precautionary measures to rectify faults quickly.
In overal1 terms, al1 the essential requirements for the successful
implementation of automatie assembly are present. This similarity between the
decision support conditions and what is already applied in the plant, is a further
evidence of the validity of the systemized knowledge.
6 CONCLUSION
The systemized knowledge, in the form of adecision support system, can advise
the management about the suitability of a proposed type of assembly system and
the steps required for its successful implementation. The management of an
existing assembly system can also benefit from the decision support systems by
comparing the ideal systems with their actual system. Therefore, the decision
support system can advise the management about how to improve any system, and
where to concentrate their efforts.
Furthermore, the systemized knowledge can be used as a teaching tool, where
the user can be shown a systematic and detailed way of implementing each type of
assembly system. In this way, the user can acquire the detailed knowledge about
each assembly system, without the need to go through a numerous number of text
books and scientific papers.
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8 BIOGRAPHY
Professor Ashok Kochhar is the Lucas Professor of Manufacturing Systems

Engineering and the Head of the Department of Mechanical Engineering at the
University of Manchester Institute of Science and Technology (UMIST),
Manchester, England. His main interests are the Design, Planning and Control of
Manufacturing Systems.
Dr Y. Abdul-Hamid is a researcher at the University of Bradford. His main

interests are Design of Manufacturing Systems.
26
Production control challenges in the
food and iron industry
Hans-Henrik Hvolbl and Jacques Trienekeni

a Department 0/ Production,
University 0/ Aalborg,
Fibigerstraede 16, 9220 Aalborg East, Denmark
E-mail: i9hhh@iprod.auc.dk
bDepartment 0/ Management Studies, University 0/
Wageningen,
Hollandseweg 1, 6706 KN, Wageningen, The Netheriands
E-mail: Jack.Trienekens@aIg.bk.wau.nI
Abstract
A comparison of the food industry in Holland with the iron industry in Denmark
shows a large resemblance in several areas such as the order handling, the delivery
precision and the production planning structure. The food and the iron industry are
traditionally not compared, but due to the development within the food industry
towards customer specific brands and the development in the iron industry towards
more generic production of non-customer specific parts, the two industries are
approaching the same situation. This paper discusses the development of both
industries and presents similar developments within several areas: Narrowing of
planning levels, new control structures and demands of future production planning
systems. The paper is an extended version of aselected paper from the WG5.7
APMS'96 conference in Kyoto, Japan (ISBN: 4-915740-20-X).
Keywords
Customer relations, Production Control Systems, Production Concepts

© 1998 lFIP. Published by Chapman & Hall
1. EVOLVING CUSTOMER RELATIONSHIPS
Currently, many changes are taking place in the area of production. These changes
are initiated by developments in the market. On one hand we see an integration of
different products and geographical markets into one large scale global market; on
the other hand we recognise a large diversification within this market. This also
reflects diversification of customer orders, not only dependent on the scale of the
international and national markets, but also dependent on the politics of the
individual company.
With regard to customer orders of production companies we experience greater
demands for product quality and delivery time and, very important, a wider assort-
ment and shorter life of the product. Within the production field this implies an
evolution towards production processes which are based on individual customer
orders.
These developments towards diversification of customer orders lead to the
phenomena that quantity and frequency of sales of products in the short run are be-
coming more and more unpredictable for many companies. Companies try on one
hand to widen their assortments, and on the other hand they try to shorten the
production time, reduce the delivery time, lower the production costs etc. This
means that the production process has to become more flexible in order to meet the
dynamics of the market. To deal with these challenges a shift in the nature of the
production control systems and the information systems supporting these is
necessary. Previous studies [Trienekens 1993,1995], [Haas et al, 1995] point out
that these changes are similar in both the food industry and the iron industry.
Typical products from the analysed companies in the food processing industry
are canned food, dairy products, beverage products, meat products and fish
products. Typical products from the analysed companies in the iron industry are
machines, tools, pumps, transmission units and heavy industry products.
Because of the complexity and interrelationships of many processes in the food
industry and because machine-capacities are relatively expensive, management of
capacities is more important than management of the product flow. In the past the
optimal use of capacities was often the key item in the planning process of these
companies. Mass production based on the capacity available was common in the
food industry as illustrated in figure 1. Figure 1 shows the developments in the food
industry concerning both diversification of customer orders and changes in the
manufacturing systems.
We see that instead of mass production (shipment) the trend is towards packing
according to order. Often one single food product can be found in many different
packages, depending on the wishes of the customer. This development is among
others caused by the branch policies of chain stores wanting to offer a large assort-
ment of products to the customer. [Trienekens 1995]
Materials planning in food industries used to be less important because of the
insignificant critical attitude to materials. As more and more orders become cus-
tomer specific, materials become relatively more important.
Production control clwllenges in the food and iron illdustry 293
1990's
Materials CapacIty
?
Shipment
~~~~~~~~~~~~~ Packlng to order

Production to order
~---+----+---------------~
2(XX)'s
CapacIty
?
baseel
Shipment
Packing to order
Produc~on to order
COOP2-PC.DRYI
Figure 1: Status and expected change in production concepts in the food industry.
Packing to order will increase at the expense of shipment (to order).
This change also influences the manufacturing systems, since the capacity oriented
planning systems are unable to cope with the new situation. In many companies the
scheduling function is today handled by the production floor manager by hand.
As illustrated in figure 1, the trend in the iron industry is illustrated in figure 2.
The development moves towards customer specific production by means of as-
sembly to order. In order to comply with customer demands assembly to order be-
comes more and more important.
The production control systems used in the iron industry are MRP based
systems as regards the shipment sector and project planning systems as regards the
production to order sectors. However, neither MRP nor project based systems are
suitable for assembly to order. Customer orders are lost in MRP systems and
materials planning is a weak part in time based planning systems.
High costs of one-of-a-kind production on one hand, and growing, diversifying

markets on the other hand point towards combined or batch production.
As illustrated in figure 1 and 2 production to stock (shipment) is still relevant
for a small part of the companies.
1990's
MRP/ MRP/
Shipment
Productlon to order
2(XX)'s
MRP/
Shlpment
~~~~'\I Assembly to order
Production to order
COOP2·UK.DRW
Figur~ 2: Status and expected change in production concepts in the iron industry.
Assembly to order will increase at the expense of production to order and shipment
(to order).
Also production to order in the food industry and in the iron industry continuos to
play an important part for these industries. For an increasing amount of products,
however, a major part of the production process is initiated by customer orders. In
hoth sectors the customer order decoupling point seems to be moving towards the
stage where products have to be assemhled (in the ir~n industry) or have to be
packed (in the food industry) to order.
Production control challenges in the food and iron industry 295
However, the production planning systems are, to some extent, unable to

support this development. MRP-systems primarily handles batch production of
orders in which the Bill-Of-Material is specified at the order point, while Project
Planning handles the scheduling problems of orders in which the Bill-Of-Material
cannot be specified at the order point. Often capacity planning is left to the shop
floor - in some companies handled by separate (pe-based) capacity planning
systems. This area will be discussed in the following section.
2. PRODUCTION PLANNING SYSTEMS
A rough classification of planning systems could lead to identifying two basic

types:
• Material-based systems
• Activity-based systems
Material-based systems (MRP) have been developed to answer the demands of

large scale batch production where materials are in focus, whereas activity-based
systems (Project Planning) are used as a scheduling tool where the time aspects are
in focus. Still MRP systems dominate the companies in Europe although a number
of accepted disadvantages are present in the systems such as:
• Oriented towards production to stock
• Hierarchic decision structure based on product structures, e.g. a product
made of half-fabricates which are made of raw materials.
• Top-down planning structure of severallevels (year, month, days)
• No support of customer order oriented production environment
• Materials and capacity are super-optimised in separate modules without
considering the interdependence between, e.g. batch sizes and capacity.
[Harrison, 91]
• Poor support of managing capacities on the shop floor
The incomplete capacity planning features lead to a number of problems especially

uncertainty of order acceptance. Both in the food and in the iron industry orders
(especially rush-orders) are typically acc~pted by the foremen on the shop floor.
This implies that the responsible administrative functions do not have the
appropriate information system to support the decision-taking in the order-handling
process. A possible solution to these problems are a division of the production in
smaller units [Jensen, 96].
3. SIMILARITIES IN CHARACTERISTICS AND DEMANDS ON

PRODUCTION CONTROL SYSTEMS
With respect to production planning structures the similarities in Characteristics

and Demands on production control systems are divided into four areas:
• handling the dynamics of the customer order
• fine-tuning the production processes
• production structures
• lot registration and traceability
The four areas are discussed in the following:
3.1 Demands with regard to handling the dynamics of the customer

order
The characteristics of the products and the delivery time required by the customer
are often unknown until the customer order is placed. Further more different
customer orders have different decoupling points as illustrated in figure land 2.
Case studies show that many companies have an accuracy in delivery of
customer orders at 80 to 85 percent [Barfod et al., 96]. For most of these
companies accurate delivery is vital to hold on to the customers. The inaccurate
delivery is caused be several circumstances. The customisation results in an
increased number of (individual) orders, which makes planning more complex.
Often the specification of the customer order is not final when the order is
accepted. Also the general reduction in delivery time make demands on a mere
precise planning. These and other effects makes it difficult for the sales and the
planning departments to have a detailed knowledge of the actuai situation in the
production and the consequences of accepting a customer order. Therefore many of
these decisions are placed on the foremen in the production even though they have
no planning tool to support the decisionmaking. The planning system and the
supporting information system should be able to support the following actions:
• Delivery specifications to the customer at order entry
• Planning of customer specific recipes I products for the food industry and
the iron industry
• Follow individual customer orders in the order cycle of the company
Production control challenges in the lood and iron industry 297
3.2 Demands with regard to fine-tuning the production processes
The planning system and the supporting information system must be able to
Distinguish between production according to order and production to stock of end-
products and half-fabricates. The fine-tuning is related to order conditions,
customer priorities etc. Also simultaneous planning of materials (raw materials,
half-fabricates and end-products; which are purchased, in stock or in the process
pipeline) and capacities (the actual and the planned use) are important
Often more than one end-product comes out of one production process (e.g.
from one pig a lot of different meat products can be made; several items could be
made out of one metal sheet in one punch operation). The possibility of planning
co-products in the production process is therefore important for both industries.
3.3 Demands with regard to the Production Structure
In the Iron industry we se a trend towards product factories and production groups,
but within a number of companies this solution is not suitable. This goes for
companies with a large number of key machines or production lines such as door
and window manufacturers. These company types have almost the same problems
as the process industry.
Therefore there is a need for more flexible production structures in this kind of
industries as illustrated in Figure 3.
Prodllnl.OIw
Figure 3. The figure illustrates the development from a fixed production line
(on the right) towards a very mixed production flow (on the left) due to the
increased number of product variants. The situation is most apparent in the process
industry and in the flow-oriented parts of the iron industry.
3.4 Lot registration and traceability
A final feature is that lot registration and traceability become of key importance in
both industries. Within a few years traceability will be required by law in the food
industry. In the iron industry the advantages of traceability are most visible when
servicing products, e.g. the ability to provide the customers / technicians with the
proper spare parts.
A company producing baby-food had to withdraw all products /rom the

store because a sampie showed remains of a cleaning fluid in the food. If
the company had been able to trace the products of the single batches (from
the production to the customer) only the affected batch had to be withdrawn
from the stores and the economic consequences and discredit could have
been reduced to a minimum. Not only the ability but also the velocity of the
tracing process is very important in this respect.
Yet another example is a company producing welding machines which are

sold throughout Europe. The products are currently improved without
changing the product identity and without tracing the batches and the used
Bill-Of-Material. The service organisation is not able to identify one variant
from another without analysing the components of the welding machine.
This makes service a complicated matter and often the technician has to
visit the customer twice to finish arepair.
4. NARROWING AND INTEGRATION OF PLANNING LEVELS.
Most companies have three planning levels. The highest level involves the
management. At this level decisions on aggregate materials (mainly contracts with
suppliers) and capacity planning, investments, personnel policy etc. are made. Most
decisions are long term decisions. At the second level the production planning takes
place. Customer orders are received and the need for materials and capacity to
cover both customer orders and stock orders are calculated. At the lowest level the
scheduling of work orders takes place. Here especially planning of capacities is of
importance.
By comparing case studies of both the iron and the food industry it appears that
there is a similarity at the second level. In many companies the production plan
from the planning departrnent are handed over to the shop floor even though the
shop floor does not use the plan at all. The primary reason for this is that the
production plans do not comply with the actual production on the shop floor.
Therefore the foremen make their own "narrow" schedule (narrow in the sense that
the consequence in the remaining processes are not taken into account). This leads
Production controt challenges in the food and iron industry 299
to "synchronisation" problems in the other processing areas as components are

delayed.
Central-oriented planning systems like OPT have focused on making a optimi-
sed plan involving all production areas in which bottlenecks, throughput time etc. is
considered. However, these systems have had little success in Denmark and
Holland as they require detailed information regarding process- and set-up time -
information which is changeable in a customer oriented production environment.
Because of the increasing importance of the ability to follow the customer order
in the process (uniqueness of the order, traceability in for example the food
industry) the grouping of several customer orders in batches may be taken care of at
the lowest level. Indeed at this level flexibility of customer orders is best possible.
In most companies a quite strict distinction between the sales and the produc-
tion department exists. Often the sales department accepts customer orders even
though the production department cannot meet the requirements (product charac-
teristics, quality, delivery time). The result is to work overtime in the production, to
exceed delivery times to the customers etc. What we are looking for is an
integration of production planning functions for the shop floor and to plan and to
give priority to customer orders in the sales department.
In order to make a reliable plan we have to involve both the sales department
and the foremen in the planning process. This could be done by making the sales
department responsible for meeting the due dates of customer orders, e.g. by
handling capacity planning at a rough level. Also planners could be moved to the
shop floor. Both actions would narrow the levels in planning structure and thereby
remove some of the existing barriers in the companies. Furthermore a possible
reduction of non-value activities are identified in several case-companies.
,- - - - - - -
~
, ,
IPlanning I :c=]: . . . . . . . :c=]:
, , ' ,
'c=]'
,
,
,
,
,
,
'c=]'
,
,
,
,
,
,
Narrow.drw
Figure 4: Narrowing of planning levels. The 'planning level' has to move towards
the shop floor in order to improve the shop floor planning
The following example illustrates an attempt of narrowing the planning levels in a

large Danish company.
A Company producing large engines and gearboxes experienced a very
complicated flow of materials. Complex products, many transports and
much handling made the planning complicated. A lot of special materials
and components were used in the production and assembly making the
purchase function vital in order to secure the delivery dates. The purchase
function was therefore included in the order acceptance / negotiation
phase.
The planning function
was split into a central and
a local level. The two
levels communicated with
the responsible purchaser
and foremen.. A detailed
plan was made in conjunc-
tion with the purchasing
department. The plan was
passed on to the planners,
which were seated in the
workshop together with the
foremen. These planners
maintained the firm plan in
conjunction with the
foremen and reported to
the central planning
function in case of
deviations or problems. AD·CASE
mvolby et al, 1994/
The example illustrates a possible solution of integrating the planning level with the
shop floor level and thereby improving the synchronisation of orders, materials and
capacity.
s. CONCLUSIONS AND FURTHER RESEARCH
There are a number of similarities between the developments in the food industry
and the iron industry:
• the trend is towards production of half-fabricates to stock and packing or as-
sembly to order
Production control challenges in the food and iron industry 301
• to support this the sales and the production planning function have to inte-
grate with the staff at shop floor level
• integrated scheduling of materials, capacities and customer orders become a
key issue in production control
The changing control structures in the food and the iron industry do have similar
implications for the way the companies are managed and for the construction of the
planning and information system.
The exchange of real time information and simultaneous planning of production
to order and production to stock, integrated with the planning of sales and
purchasing become essential. On the shop floor computer networks, integrated
scheduling tools and a database management system linked with the companies
administrative systems, have to support the modern control structures of the
companies. Integration and flexibility in production control become the key issues
in production control ofthe 2000's in both the food industry and the iron industry.
Furthermore analogies to other industries such as wood, plastic, electrical etc.
could be relevant to analyse, as the dynamics of the markets effects not only the
iron and the food industry.
Because of the integration of the former hierarchical and functional divided
levels in the organisation and the importance of flexible production methods, we
notice a trend towards cross functional tasks, e.g. the sales and production planning
function, and self responsibility in multi functional teams, which improves flexible
answers with regard to customer orders.
Further research must focus on:
• Order control (handling)
• New ways of working
• New ways of managing
• New information system architectures
to ans wer the dynamics of the market.
6. REFERENCES
Barfod, Ari; Hvolby, Hans-Henrik. Order Management. Industriens Forlag,

Copenhagen, Denmark, 1996. (In Danish)
Bertrand J.W.M., J. Wijngaard, J.c. Wortmann. Production Control, a Structural
and Design Oriented Approach. Elsevier. Amsterdam, 1990.
Burbidge J.L. Production Control: a Universal Conceptual Framework. Produc-
tion Planning and Control. Voll, no 1.
Jensen, Morten Guld. A Product-Oriented Production Structure in order to

decentralise the Planning Tasks. Proceedings of the IPS conference in Fuglsoe,
April 1996.
Haas, Henning de; Hvolby, Hans-Henrik. A Holistic and situational approach for
effective Production Planning and Control. Proceedings of the Prosem '95
conference. Molde, Norway, May 1995
Harrison, Mike: Finite Scheduling in Perspective. BPICS Control, December '92.
Hvolby, Hans-Henrik; H~jbjerre, Per: "A More Flexible Planning Architecture for
Centralised and Decentralised Planning". Proceedings of IFIP WG 5.7
Working Conference, Gramado, Brazil, 1994. ISBNIISSN: 0-444-81910-x.
Trienekens J.H., Trienekens J.J.M. Information systems for production manage-
ment in the food processing industry. Processings of the IFIP WG 5.7 - APMS
'93. Greece, Athens, 1993.
Trienekens J.H., Meijs C. Key Quality Characteristics 01 Logistic Information
Systems in Changing Business Environments. Processings of SQM 95
conference in Sevilla, Spain. Eds. M.Ross et al. Computational Mechanics
Publications Voll. Southampton UK, 1995.
7. BIOGRAPHY
Hans-Henrik Hvolby received a M.S. degree in management systems from

University of Aalborg, Denmark in 1984. From 1984 to 86 he worked as a planning
engineer with Aalborg Boilers. From 1986 to 89 he was a researeher at the
Department of Production at University of Aalborg, and in 1989 he received a
Ph.D. degree with the title "Information Systems for Production Planning and
Control". From 1989 to 93 he worked as an assistant Professor at the Department
of Production, interrupted by aleave from 1990 to 1992 where he worked as a
project Manager with F.L. Smidt. Since 1993 he has worked as an associate
professor at the Department of Production, Aalborg University. His working areas
are production planning and control, order management and information systems.
Jacques Trienekens received his degree in geography from Nijmegen University,

the Netherlands in 1984. He worked as a researcher at a public welfare organisation
until 1986. After that he worked as a consultant on information systems and
management at a public health organisation, was a lecturer in information systems
at the Open University and lecturer in information systems at an institute for higher
economic education. Since 1991 he has been an assistant professor at Wageningen
Agricultural University, department of Management Studies, in the Netherlands.
His research interests include information systems and logistic management.
27
Expert system for new product
strategy development
Marimint.t, Lien Herlinat, Andri Aulia§, Motohide Umano*, Itsuo Hatono t , and
Hiroyuki Tamura t
t Department 01 Systems and Human Science
Graduate School 01Engineering Science, Osaka University
1-3 Machikaneyama, Toyonaka, Osaka 560, Japan
E-mail: tamura@ß;ls.es.osaka-u.acJp
t Department 01Agro-Industrial Technology
Faculty ofAgricultural Techn%gy, Bogor Agricultural University
p.o. Box. 220, Bogor 16002, Indonesia
E-mail: jietaipb@Server.indo.net.id
§ Good Year, Co., Bogor, Indonesia
*Department of Mathematics and Information Sciences

College olIntegrated Arts and Sciences, Osaka Prefecture University
1-1 Gakuen-cho, Sakai, Osaka 593, Japan
E-mail: umano@mathsun.cias.osakaju-u.acJp
Abstract
This article discusses key issues in designing and implementing an expert system for
new product strategy development. The expert system prototype is able to create a
product development strategy plan that guides product development efforts of com-
panies, Le., soap industries which matches with market, consumers needs and firm's
ability and potencies comprehensively. One of its outputs is a guideline to product
developers about the critical factors and focuses ofthe products. It also provides as
a tool for involving consumers in the product development processes. The system is
implemented by using an expert system shell on a PC environment.
Keywords
Product development strategy, heuristic approach, soap industry, systematic knowl-
edge acquisition, frame-tree knowledge representation
1 INTRODUCTION
New product strategy is a master plan that guides product innovation efforts of the
company, and links new product development to the corporate plan. lt is considered
as a key factor for maintaining or even developing progress of companies. Complex
internal and external factors that include consumers' requirements must be consid-
ered to develop the strategy (Cooper, 1987; Ciccantelli and Magidson, 1995). It is
a semi- or fully-unstructured problem which deals with uncertainty internal to the
firm as weil as external to the firm such as technology, politics and organizational
priorities (Barczak and Wilemon, 1991). A suitable method must be used to handle
these uncertainties.
Advances in Production Management Systems N. Olano, H. Tamura & S. Fujii (Eds.)
Some methods have been used for new product strategy development which usu-
ally consist of creative thinking and brain storming stages. They are supported by
suitable communication and leadership patterns within the product developer team
and also between the team and the related divisions in the company. Some success
product development processes are, e.g., a "Product launch model", and a "Gating
System" (Bart, 1995). These methods rely on coordination and sequential phases.
However, the new direction for the product development reIies on the integration and
overlapping activities (Allen et al., 1995). Moreover, creating product development
strategy suitable for a specific company is a time- and cost-consuming process.
As one alternative to solving the problem, we propose an expert system for new
product strategy development (ESPROSD). The expert system prototype is able to
guide product developers identify the critical factors and focuses ofthe product that
include the main physical characteristics, the benefits of the main factors, packaging
design and marketing guidance for the new product strategy development. It also
provides as a tool for involving consumers in the product development processes.
2 DEVELOPMENT METHODOLOGY
This research identifies the critical factors analysis and direction of the product de-
velopment strategy that can be assisted by an expert system. It accommodates qual-
itative and quantitative factors, and certain and uncertain values through a heuristic
process.
The method used for developing the expert system is similar to that suggested
by Marimin et al. (1995). It consists of several steps: problem identification and
selection, experts selection and knowledge acquisition, knowledge representation,
reasoning model development, software selection and implementation, validation,
verification and testing.
The product development stages followed by the knowledge engineer (KE) as the
basic for the knowledge acquisition process are those suggested by Ciccantelli and
Magidson (1995). The main stages are (I) brain storming and/or consumer design
session to identify and to define the product concept, focus group and survey in
target markets to develop physical design and manufacture prototype, (2) product
idea modification based on focus groups and survey, (3) market test prototype, (4)
revision, and (5) finish product or service goes to market test.
Knowledge is collected from the related experts, practitioners and published ma-
terials through systematic knowledge acquisition. Rules are designed to represent
relations among parameters. Certainty factor is used to resolve uncertain informa-
tion. The mies, parameters and variables are packed into a frame-tree knowledge
representation. Conclusions are inferred through forward and backward reasoning
using a tree search with the pmning control strategy. The system is applied to a soap
industries product development case using a Personal consultant plus expert system
shell on a PC environment.
The expert system prototype is tested internally to ensure that it implements the
system correctly. Hs performance is also tested externally by the experts contributed
in the system development and the potential users (product developer practition-
ers). The validation checklist, guideline, and procedure used are those suggested by
Meseguer (1993). The technical operation validation steps followed are those sug-
gested by Texas Instrument (1986).
Expert system for new product strategy development 305
3 KNOWLEDGE ACQUISITION
3.1 The Critical Factors Consideration
Many factors must be considered to create a new robust product. Some common
internal critical factors include but are not limited to (l) product factors: product
complexity, product innovation, and design maturity at validation turnover; (2) pro-
cess factors: schedule pressure, validation intensity, corrective action aggressiveness,
and corporate commitment to the program (Zum, 1991). Many other factors may ex-
ist specific to each company and its product lines. For example in the soap industry
the factors include health benefits and environment impact especially a water pollu-
tion aspect. The external factors include targeted consumers' preference, attitude and
culture, consumers needs, competitors, product regulations, and the related business
environment. These factors can be ranked according to their degrees of criticality.
The key success factors in the product development then in marketing are usually
include: product quality, product development: price, know-how, product reliability,
service, flexibility and after-sales service, customer requirements, technology, and
internationalization: promotion and marketing. Those can be classified into several
issues namely; product features, technical, customer needs, marketing, manufactur-
ing, schedule, financial, managerial and resources issues in which customer needs
are the most important (Barczak and Wilemon, 1991).
The critical factors can be obtained from several sources: users or customers, mar-
ket organizations, fairs, research institutes or universities, journals, books, and other
research reports and information media, competitors, international patent publica-
tions and others.
The factors collected should cover the main factors affecting to all product devel-
opment stages. Although the product development stages are different on each ex-
pert, the basic stages are similar. They include ideas development, concept develop-
ment, concept pre-test, prototype development, prototype market test, modification
and refinements. A care must be taken in every stage to ensure that the result of that
stage is free offlaws. Before the newly introduced product goes to mass production,
it must be comprehensively re-tested in various stages of its product development
cycle (Ciccantelli and Magidson, 1995). The test should also focus on the coverage
of the product to the customer requirements.
3.2 The Acquisition Process
We select a soap industries product development as a case for the expert system pro-
totype testing. Sources of expertise used to develop the expert system are an expert
from a product development consulting company, two experts from product devel-
oper managers, one expert from a university, and available written materials such as
journals, books, and research reports.
The knowledge acquisition methods used are a combination of discussion, prob-
lem description, and guided interview. KE met with each expert at least twice. In
the first time, KE outlined the problems to be solved, went through some details and
sometimes verified the knowledge already collected. Through an interactive process,
it is possible to obtain clear systematic decision paths and their associate parameters
and variables ofthe new product strategy development.
An example ofthe knowledge acquisition process is shown in Table I. The acquisi-
tion process starts from general subject matters; the reasons of the problem existence
and complexion, and the suitable method to solve the problem. Then the process
goes into some detail factors, variables and parameters associated to the problem.
Table I Knowledge acquisition process.

Knowledge Acquisition
KE What are the main purposes of a product strategy development
for a company?
Expert Product development can be classified into a new product, a
new brand, and new service development. The main purpose of
these product strategies is for maintaining and/or
developing the progress ofthe company.
KE What are the main factors for developing the strategy?
Expert There are various factors which include internal and external
factors. The internal factors are, e.g., product
characteristics, product life cycle, and the global corporate
plan of the company. The internal factors are, e.g., product
competitors, product position and market share ofthe targeted
consumers' level, attitudes, culture value, and regulations of
the governing body.
KE (Asks Jor details about the Jactors.)
Expert (Provides details.)
The discussion continues ...
The knowledge collected is then classified into static and dynamic types. The static
knowledge is represented in the form of frames and parameter values, while the
dynamic knowledge is represented using production rules which represent relations
among parameters that can be used to infer conclusions.
The parameters are classified into two types; ordinary and intermediate param-
eters. The ordinary parameter values are set directly by KE during system design,
or are provided by user during consultation. The intermediate parameter values are
computed during reasoning process using the appropriate mies.
The ordinary parameters include, but are not limited to, competitor, market, dis-
tribution, product-user, product-buyer, promotion type and budget, price, economic-
situation, customer loyalty, customer-preference, product-characteristic and packag-
ing design and type. The intermediate parameters include, but are not limited to,
market type, environment type, product position, and requirement level. The logical
structure of the main parameters are shown on Figure 1. It is used as the basic de-
cision path in the reasoning process. It shows that there are 5 levels of parameters
in which New-product-strategy is the highest (the goal parameter), while the others
are either intermediate parameters or the subgoal parameters (e.g., Market-trend, En-
Expert system/or new product strategy development 307
vironment, ete.) or ordinary parameters (e.g., Types ofbuyers, Promotion, Poteney,

ete.).
Promotion ~ Compe-
Distribution ----.r- tition }
Economic- .
situation EnVlronme}t
Company
Loyalty y- position
Usage
Market b'end
Peneb'ation ~Market
needs
Potency ~
Requirement New Product
Growth Strategy
Types of bUyer~
t
. .
MoUvauon AttitUdes}
Completeness Focus
Imagination
Information Packaging
Identification
Description
Figure 1 The logieal strueture ofthe main parameters.
Part of the knowledge eonsists of uneertain information. This uneertainty is han-

dled by using a eertainty-faetor teehnique (Shortliffe, 1976). After the first diseussion
with experts, KE classifies the parameters as exaet or inexact. The inexaet parameters
are provided with initial eertainty-faetor (c.fJ values. These values are diseussed with
the experts to get the final basie cfvalues both in parameters and in the associated
rules.
4 DESIGNING THE SYSTEM
4.1 The Knowledge Representation
The knowledge is paeked into a frame tree that its strueture is shown in Figure 2. The
frame tree eonsists of a root frame (Produet-Development), a subframe I (Produet-
Charaeter), and a subframe 2 (Marketing). Every frame eonsists offrame properties,
a parameter group, and a rule group.
Root-frame properties include goals, initial data, and translation describing the
purpose of the frame. The subframe properties include goals (optional), initial data,
translation, and oeeurrenee. The goal property is a list of one or more parameters that
eonclude the frame. The oecurrence value is used to specify the number of times of
the frame ean be instantiated.
The parameter group represents all parameter names used. Eaeh parameter has
properties which represent the kinds of expected values, and the prompt that asks
-(goals) . -(goals)
-initial data -initial data
-translation -translation
-occutTence -occutTence
Figure 2 A Tree frame structure.
the user for the parameter value. The parameter properties include type of parameter,
translation, prompt, help, and expected legal-values. The parameter types used are
ask-all, multi-valued, single-valued, yes/no, and textag which represents a piece of
text. These parameter types are useful for gathering information from the user during
consultation.
Rules are used to specify how to infer a parameter's value from the current con-
sultation, to show the logical relationship between parameters, to communicate in-
formation to the user, and to infer conclusion from the facts available. Every rule
has structure and information properties. The rule structure properties consist of an-
tecedent, explanation, if, invalid, and then properties. The rule information properties
consist of optional user-defined properties such as comment, and the time ofthe rule
is created.
The antecedent property specify the way the rule is being used, either consequent
(when its value is NO) or antecedent (when its value is YES). The explanation prop-
erty will enable the system to justify a conclusion. The IF property value is "if" part
of an if-then rule. The INVALID property is used to indicate whether the rute is
correctly edited to the system. The THEN property is the "then" part of an if-then
rule.
Rule 20 is an example of an antecedent rule.
Rule20:
IF(Buyer=Benefit) AND
(Motivation=Emotional)
THEN Attitude=Attitude I
EXPLANATION: Attitude 1 is a type of customer
preference and behavior toward
the product.
ANTECEDENT : YES
(INVALID: NO)
Expert systemfor new product strategy development 309
In the example above, Buyer, Motivation and Attitude are parameters. Benefit and
Emotional are values which are supplied by the user. Attitude is an intermediate
parameter which is being used by other rules to derive the final conclusion.
The parameter values of some rules are provided with a cfvalue. Rule 85 is an
example of a consequent rule with a cfvalue on its parameter value.
Rule 85:
IF(Promotion=Consumer-beliet)
THEN Competition=Tight (cf=0.80)
EXPLANATION: The final competition level
will be computed by the other
associated rules.
(ANTECEDENT : NO)
By considering the cfvalue, one can suggest that a conclusion or a situation did
not occur, very likely did not occur, probably dit not occur, is doubtful, probably
occurred, very likely occurred, or did occur (Marimin et al., 1995).
4.2 The Reasoning Mechanism
Exact and inexact reasoning are used to infer conclusions from knowledge stored in
the knowledge base and some other information provided by user during consultation
process. The process results a set of conclusions with certainty factors information
on some of its elements.
Rules are processed depending on their types: consequence rules, antecedent rules,
or self-referencing rules. About 75 percent ofthe rules implemented are consequent
rules.
The consequent rules are the coded hypotheses form that can be tested to prove the
conclusion. The system first determines the goal parameter(s) that constitute(s) the
conclusion, and then test the associated hypotheses or rules. The search method used
is backward-chaining which focuses on finding rules to provide necessary parameter
values. When the system needs a parameter value, it searches a rute that might set the
value ofthat parameter. If it is found, the system tests the IF statement ofthat rule to
see that value. If it is successful, then the THEN statement of the rule is performed,
otherwise the system searches other rules to conclude the unknown parameter value.
Ifthere are no rules left, the system asks the user to provide a value ofthat parameter.
The system uses antecedent rules when the value of one parameter implies the
other value. This can keep the system from asking too many or redundant ques-
tions. Let us consider Rule 20 ofthe previous section. The system allows the user to
provide Buyer and Motivation parameter values. When the values are provided, the
system directly deduces that the Attitude is Attitude I which has al ready defined in
the knowledge base. The Attitude I value is not necessarily asked of the user. The
rules are tried when one of their premise parameters has been traced during consul-
tation. When they are tried, they do not force tracing of their premise parameters, but
they rely on known information within the system. The antecedent rules use forward
chaining search to find other rules that derive new facts or values for their parameters.
A self-referencing rule refers a parameter in the IF statement and then concludes a
value for the same parameter in the THEN statement. This rule can be either conse-
quent or antecedent rule. It is very useful for assigning adefault value to a parameter
if all other applicable rules have failed, and to modify certainty factor value of a
parameter based on other conditions in the IF statement.
Intermediate and final cfvalues of the suggested conclusions resulting from sev-
eral decision paths are computed in the following steps. The certainty factor of the
IF statement is calculated; when the statement is combined with an AND function,
each of its clause must be true for the IF statement to be true. Its certainty factor is
the minimum certainty factor of the clauses. When the statement is combined with
an OR function, the statement is true ifthere is at least one clause is true. Its certainty
factor is the maximum certainty factor of the true clauses.
In the system implementation, in order the THEN statement to be executed (i.e.,
for a rule to pass), IF statement must be tested true with a certainty factor at least 0.2.
When the parameter value being concluded has a previous cfvalue associated with
it, the new cfvalue is computed according to the cfvalue on the IF statement and the
cfvalue on the THEN statement.
Knowledge about the particular problem is useful to guide the chaining process.
It includes deciding which subproblem space to disregard or discard. This idea is
called tree search with pruning control strategy. It is used as apart of the reasoning
J
process. An example of such a process is shown in Figure 3.
Promotion ~Compe
Distribution ---I!ition .
:~:~:c- EDVironmJnt
Company
position Market ttend
Loyalty ~
~Usage .
r
Penetration ]-Market
needs
potenc Y NewProduct
equirement
Growth Srrategy
1
II---Focus ____ I
Figure 3 Tree search with pruning control strategy.
Suppose, in a consultation, user provides value customer-beliefto parameter Pro-

motion and YES to parameter Distribution, then the system traces the value of Com-
petition parameter. Based on an available rule, the Position should be Competition
I. Then the system traces the Environment parameter value. In that case, there is no
rule that directly deduces Competition 1 into the Environment value. However, there
is a rule that deduces Competition 1 and an Economic-situation parameter value into
an Environment value. The system asks the user to provide an Economic-situation
value. When it is provided, the Environment value is deduced, and a path leading
to the Company Position is cut. This process continues a long the paths leading to
the goal parameter, i.e., until it suggests the intended conclusion, a set of new prod-
uct strategy. The search methods used to find the rules are forward and backward
depending on current position of the parameter and its associated rule type being
tested.
5 VERIFICATION AND DISCUSSION
During the consultation process, the user provides static and dynamic inputs to the
system. Some hidden information is not necessarily asked of the user, since such
information is either common in nature or too technical to be shown to a regular
user. In tbis case, the KE puts such knowledge in a static hidden knowledge base
together with the associated models or rules. Some basic information for dynamic
inputs should be collected from market and product researches. If such information
is not available, default values provided by the system can be used.
The static inputs include a product position in its life cycle, economic situation,
and product distribution area. These static input choices can be updated by the KE
or a programmer based on new knowledge collected from marketing and product
researches. The dynamic inputs include cost, usage, attitudes (targeted consumer
behavior and preferences), and competitors.
Each input parameter has its own type, either ask-all, yes/no, multi-valued or
single-valued in which some of the parameters are provided with certainty factor
values. The user interface ofthe system is designed in such manner that the user can
easily interact with the system. The user may update, cancel, ask on-line help, or ask
a justification to certain conclusion. The consultation log together with the output
can be directed into several output formats.
An example of summarized user inputs to questions asked by the system during a
consultation set is shown in Table 2. Some ofthe questions asked are market growth,
product usage, competitors and economic situation, company position in the com-
petition, product position, and customer preference and attitudes toward the product
and its packaging design. The system will generate a suitable user interface for each
parameter asked. Figure 4 is an example of such a user interface. In that case, com-
petitor is a single-valued parameter. The user selects one ofthe provided options and
set the associated cfvalue (i.e., one point represents 10% cfvalue).
The system processes the inputs interactively through reasoning strategies which
have been designed. The outputs are suggestions toward the product developers in
the critical factors and focuses ofthe product that include the main physical charac-
teristics, the benefits of the main factors, packaging design and marketing guidance
for the new product strategy development.
The outputs are incorporated with cf values, and the user gives priority to the
suggestions accordingly. Table 3 is a summary of a set of consultation outputs based
on inputs Iisted on Table 2.
Table 3 shows that the focus ofthe product should be in the physical characteristics
(texture and smoothness), health benefit, and packaging comportability. The system
also suggests for introducing completely a new product or the same product but with
different type of appearance and packaging.
For validation and verification purposes, the expert system prototype was tested
and judge by the experts who are participated in the developmerit process. Based on
°their suggestions, the system is revised on several areas, especially the user interface,
the help facility, and the static parameter values. The revised system prototype was
Table 2 Summarized inputs on a set of consultation.
Parameters Values
- Product's user type New-comers
- Number of competitors A few:60%
- Sales condition Increase: 70%
- Consumers' cost consideration YES
- Marketing cost consideration YES
- Economic situation Stable: 60%
- Company position in the com.. Market-Ieader
- Approach ofthe product sale Consumer-belief
- Usage of competitor distri .. YES
- Product penetration at mar.. High: 60%
- Consumers loyalty High: 60%
- Market potency Wide
- Consumer acceptance analysis YES
- Main factor consumer to buy .. Benefit
- Consumer motivation to buy .. Emotional
- Packaging distinctivity YES
- Product Iiability YES
- Consumer awareness NO
- Direction on the packaging NO
Table 3 Summarized outputs of a consultation process with inputs Iisted on Table 2.
Conclusion for Frame Product

Focus ofthe product development:
- Subjective physical characteristics: e.g., texture and smoothness
- Health benefits: e.g., cleaning strength
- Packaging design: e.g., consumers' comportability
Conclusion for Frame Marketing:

- Please focus on the consumers requirements
- Market is still high, therefore please introduce
new models or appearance ofthe product (60%).
Special attentions:
- Physical subjective characteristics
How is the number of competitors trend?

(Press Fl for c1arification)
YES
Steady
Increasing
Decreasing
1. Use arrow key to indicate your degree of certainty

2. To seleet one item, with 100% certainty. press CRTL-right arrow
3. After making seleetion, press ENTER to continue
Figure 4 An example of a user interface for obtaining a parameter value from the
user.
accepted by the experts as a system that could assist rather than substitute them in
developing a new product strategy. The system was also tested by regular users, the
product developer practitioners. According to them, the system could assist them
especially in the initial stages of the new product strategy development. It should
be expanded to wider aspects of the development such as in the product prototype
design.
6 CONCLUDING REMARKS
The expert system for new product strategy development can be used to assist soap
industry companies and/or product development consulting companies in creating
product development strategy especially in the initial stages of the product develop-
ment processes. It also provides as a tool for involving consumers in the development
process.
Further work is needed to fully implement the system comprehensively, such as
in the new product prototype design. By doing so, it will enable the system creates a
more complete new product strategy.
The expert system prototype can be applied to similar industries with different
products or locations through some parameter modifications.
7 REFERENCES
Allen, TJ., C. KarIsson, and F. Norrgren. (1995). Introduction to the cluster of prod-
uct development. IEEE Tran. Eng. Management, 42(2), pp. 191.
Barczak, G. and D. Wilemon. (1991). Communications patterns ofnew product de-
veloprnentteam leaders. IEEE Tran. Eng. Management, 38(2), pp. 101-109.
Bart, C.K. (1995). Gagging on Chaos. IEEE Tran. Eng. Management Rev., 23(2), pp.
41-49.
Ciccantelli, S. and J. Magidson. (1995). Involving consumers in the product devel-

opment process. IEEE Tran. Eng. Management Rev., 23( 1), pp. 30-34.
Cooper, R.G. (1987). Defining the new product strategy. IEEE Tran. Eng. Manage-
ment, em-34(3), pp. 184-193.
Marimin, Eriyatno, S.A. Muktirizka, and H. Tamura. (1995). Expert system for
product-advertising-strategy development. J. In tell. and Fuzzy Systems, 3(2), pp.
107-116.
Meseguer, P. (1993). Expert system validation through knowledge base refinement.
Proc. 1Jlh Int. Conf Artif. IntelI. Chambery, France, pp. 477-482.
Shortliffe, E.H. (1976). Computer-based medical consultation: MYClN. Elsevier
Science, New York.
Texas Instrument. (1986). Personal Consultant Plus (PC-plus) Technical User Man-
ual. Austin, TX.
Zum, T. (1991). Problem discovery function: A useful tool for assessing new product
introduction.IEEE Tran. Engineering Management, 38(2), pp. 100-119.
8 BIOGRAPHY
Dr. Marimin is a lecturer at Department of Agro-industrial Technology, Bogor Agri-

cultural University, Indonesia. He received a Ph.D. degree from Department of Sys-
tems and Human Science, Graduate School of Engineering Science, Osaka Univer-
sity, Japan. The title of his dissertation is "Linguistic labels based methodology for
fuzzy group decision making". His research interests include fuzzy expert systems,
fuzzy group decision making, and their applications to product development and
management technology.
Mrs. Lien Herlina is a lecturer at Department of Agro-industrial Technology, Bogor

Agricultural University, Indonesia. Her research interests include product develop-
ment and marketing.
Mr. Andri Aulia is a production staff at Good Year Co, Bogor, Indonesia. His re-
search interests include applications of expert system on new product development.
Dr. Motohide Umano is a professor at Department of of Mathematics and Infor-

mation Sciences, College of Integrated Art and Sciences, Osaka Prefecture Univer-
sity, Japan. His research interests include fuzzy-set oriented programming languages,
fuzzy databases, fuzzy expert systems and fuzzy knowledge information processing.
Dr. Itsuo Hatono is an assistant professor at Department of Systems and Human

Science, Graduate School of Engineering Science, Osaka University, Japan. His re-
search interests include production scheduling for complex and large production sys-
tems, and modeling of discrete event systems such as manufacturing systems and
computer networks.
Dr. Hiroyuki Tamura is a professor at Department of Systems and Human Science,

Graduate School of Engineering Science, Osaka University, Japan. His research in-
terests center on the systems methodology for large-scale systems such as modeling,
control and decision making, and their applications to manufacturing systems and
public systems.
28
Performance evaluation of a JIT
production system
Mitsutoshi Kojimat, Katsuhisa Ohnot and Kenichi Nakashima:f:
tDepartment of Systems Engineering,
Nagoya Institute ofTechnology
Gokiso-cho, Showa-ku, Nagoya, 466, JAPAN,
Tel: +81-52-735-5403 and 5390
Fax: +81-52-735-5401 and 5390
E-mail: kojima@system.nitech.ac.jp.
ohno@system.nitech.ac.jp
:f:Department of Industrial Management
Osaka Institute ofTechnology
5-16-1, Omiya, Asahi-ku, Osaka, 535, JAPAN,
Tel: +81-6-954-4788
Fax: +81-6-952-6197
E-mail: nakasima@taylor.dim.oit.ac.jp
Abstract
In a Just-in-Time(JIT) production system, two kinds of Kanbans are used as tools
to control the production and withdrawal quantities in each stage. The number of
Kanbans used in stages decide the performance of the JIT production system. This
paper analyzes it under stochastic demand and deterministic processing times. An
algorithm is devised for computing stationary distributions of its production
quantities and total backlogged demand. This algorithm can determine optimal
numbers of two kinds of Kanbans. A numerical example is computed by this
algorithm.
Keywords
Just-In-Time production system, Performance evaluation, Optimization
© 1998 IFIP. PubIished by Chapman & Hall
1 INTRODUCTION
A Just-In-Time(JIT) production system is invented to chiefly aim at cost reduction

by eliminating unnecessary elements in production (Monden, 1993). In a JIT
production system, two kinds of Kanbans are used to control the production and
withdrawal quantities in each stage. They are production-ordering Kanbans and
withdrawal Kanbans. In particular, a withdrawal Kanban used for a vendor is called
a supplier Kanban.
The numbers of Kanbans used in each stage decide the performance of the JIT
production system. In the case where the demand is deterministic, Bitran and
Chang(1987) deal with a deterministic multi-stage JIT production system. They
formulate a problem of determining the number of production-ordering Kanbans in
each stages into a nonlinear mixed integer prograrnming problem. In the case where
the demand is stochastic, Kimura and Terada(1981) show by simulation how
fluctuations of the demand influence the production and inventory in the preceding
stages in a multi-stage JIT production system. Deleersnyder et al.(1989) analyze
the effect of the number of Kanbans, the machine reliability, the demand variability
and the safety stock requirements on the performance of a JIT production system
by numerical computation based on a discrete time Markov process. Wang and
Wang(1990) deal with a JIT production system as a Markovian queue under the
condition that both interarrival times of the demand and processing times are
exponentially distributed. Karmarker and Kekre(1989) study a two-stage JIT
production system by using queueing theory and show its numerical results. Mitra
and Mitrani(1990,1991) show that a Kanban discipline dominates a c1assical
production discipline in terms of throughput. Kirkavak and Din~er(1996) develop
an exact performance evaluation model for JIT production system using discrete-
time Markov processes and propose a computationally feasible approximate
decomposition technique. Tayur(1992,1993) derives structural properties of a
multi-stage JIT production system using a generalized semi-Markov process.
Under stochastic demand and deterministic processing times, Ohno et
al.,(1995) discuss a JIT production system with the production-ordering and
supplier Kanbans and derive a probability generating function(p.g.f.) of the
stationary distribution of the backlogged demand. They, however, do not obtain
any results on the production quantity except its expectation. Cohen and
Boxma(1983) develop complex valued function techniques for the analysis of
queueing systems which need for their modeling a two-dimensional state space. In
this paper, we consider the JIT production system with two kinds of Kanbans under
stochastic demand and deterministic processing times to derive a p.g.f. of the
stationary distribution of its production quantities and total backlogged demand as
a two-dimensional complex valued function. An algorithm for computing the
stationary distributions is devised based on the p.g.f. This algorithm can determine
optimal numbers of two kinds of Kanbans. Stationary distributions of the
production quantities and total backlogged demand are shown in a numerical
example.
Performance evaluation 0/ a 1fT production system 317
2 A JIT PRODUCTION SYSTEM
In a JIT production system, two kinds of Kanbans are mainly used: a production-
ordering Kanban and a withdrawal Kanban which are attached to containers of
parts. The withdrawal Kanban specifies the kind and quantity of the parts which the
subsequent stage should withdraw from the preceding stage, while the production-
ordering Kanban specifies the kind and quantity of parts which the preceding stage
must produce. The number of production-ordering Kanbans corresponds to the
maximum possible stock by the container of the parts produced in the stage.
Similarly, the number of withdrawal Kanbans corresponds to the maximum
possible stock by the container of the parts used for production in the stage. As the
number of Kanbans increases, the stock of the parts also increases and the dead
stock occurs. Conversely, as the number of Kanbans decreases, the stock of the
parts also decreases and the shortage may occur. Therefore, they have influence on
the performance of the JIT production system such as its inventory level,
backlogged demand and production quantities.
We consider a JIT production system with supplier and production-ordering
Kanbans (Ohno, et al., 1995) which is shown in Figure 1. In this system, the
demand is stochastic and the processing time is deterministic. The following
notation is used:
L : the lead time of the delivery,
M : the number of production-ordering Kanbans,
N : the number of supplier Kanbans,
C : the production capacity of the stage,
Dk : the demand in period k,
Bk : the backlogged demand at the beginning of period k,
lk : the inventory level of the part at the beginning of period k,
J k : the number of the production-ordering Kanban in the production-ordering
Kanban post at the beginning of period k,
Pt : the production quantity in period k,
e :a part O:a product - flow of parts or products

• :a supplier Kanban < ____ flow of information
o :a production-ordering Kanban
r-----'
, ,
to asupplier ~ _____ •
M ~-----~
~ ~----_.~ J I ~ r--t 1_ ~ ............. -: from customers
.~---- ~--------
••
41 .. - - - - - - ... ~
00
le.I··
---01• •
00 0
l---toI 00 1 - - - -
'------'
from a supplier I. M - 1 k 10 customers
Figure 1 A JIT production system

Xk = Bk + J k : the total backlogged demand at the beginning of period k.

The preceding stage is a supplier and the parts consumed in period k( = I, 2, •.. )
is ordered to the supplier at the beginning of period k + 1 and they are delivered at
the beginning of period k + L + I. It is assumed in the following of this paper that
the demand of the product in each period is independent and identically
distributed with mean D, the excess demand is backlogged and the container
capacity is equal to one.
It holds (Ohno, et al., 1995) that for k = 1,2,3,.··
= I + LP;,
k-I
N k (1)
;=k-L
I H1 = I k + fl-L - fl, (2)
fl = min(h, J ko C), (3)
4.+1 = [Bk + J k + D k - P k - Mt, (4)
Jk+1 = min(M,Bk + J k + Dk - ~), (5)
XH1 = X + Da: - fl,
k (6)
where Po, P- 1•.., P-L+I are given and [xt =max(O,x).
3 THE PROB ABILITY GENERATING FUNCTION OF THE

STATIONARY DISTRIBUTION
We derive a probability generating function of the stationary distribution of

backlogged demand and production quantities in the JIT production system.
It follows from (3) and (6) that Xk and Pk , k = 1,2,3, ... in the case of N > (L +
I)M' have the same Values as those in the case of N (L + I)M', where M' = =
min(M,C). Therefore we can restrict without loss of generality to the case where N 2
(L + I)M'. Define integers m and v by N= mM' - v, 1 2 m 2L +1,0 2 v 2M' - 1.
It is shown in Ohno, et al., (1995) that for n = 1,2,3, ...
L+I
y" =Xn(L+I)+1 =max{D.(L+I)' Dn(L+l) + D.(L+l)-I- M',···, L ~.-I)(L+IH;
;=L-m+ 2
- (m -1)M ,
L+I
Yn-I + LD<n-I)(L+Il+; - N}. (7)
;=1
Define random variables Y..-1 (k) and 1.-1(k) ,n =1,2,3, ... ,0 2 k 2 m, by
L-m+1
Y._1(0) = 1;;-1 ,Y..- 1(1) = [Y._1(0)+ LD(.-I)(L+l)+; - M +vt ,
;=1
Y._1(k) = [1;;-1 (k -1)+ D.(L+I)+k-m-1 -M' t, (8)

L .....+l
1..-1(0)= ~.-I)(L+l)+1 ,1.-1(1) = [M -v - Y._1(0)- L 4"..1)(L+I>+it + 1.-1(0)
;=1
and
1'_1 (k) =min{[M' -Y,._I (k -1)- D.(41l.,k_m_l r + 1._1(k -1), M}. (9)
Performance evaluation of a fIT production system 319
L+l
Since In(L+l)+1 = N - L~n-l)(L+l)+;
;=2
L+l
= N - (LD(n-l)(L+I)+; + X(n-l)(L+I)+l - Xn(L+l)+I)+ P(n-l)(L+l)+1

;=1
and
L+l
(m - k)M +Xn(L+l)+1 - L D(n-l)(L+l)+i - Yn_1(k) ;;:: 0, 1 ~ k ~ m,
;=L-ntH+l
(7) through (9) imply that
Yn = Yn-1(m)+Dn(L+l)' (10)
and
P"(L+l)+1 =
min{Yn-l(m)+Dn(L+l),ln-l(m)}. (11)
The JIT production system is called stable, if Yn- 1 (0) Yn- 1 and =
I n - 1 (0) = Prn-l)(L+l)+1 converge in distribution to Y(O) = X_ and 1(0) = P_,
respectively, where (X_, P_) is distributed with the stationary distribution. The
following condition is derived by Ohno, et al., (1995):
If Pr{ 4 _ D} > 0, then the JIT production system is stable if and only if
min{C,M,N/(L+I)}>D. (12)
Denote the p.g.f. ofa random vector (X_,P_) by X(z,w) = E[ZY_WRo]. Then it
can be shown from (10) and (11) that
X(z, w)=
{ ZM'-, D(z)m L L L
M'-v-l x M'-v-I-x
(Wi+M'-,-x-d - ZX+d-M'+'W i )
%=0 j=O d=O
LD. =d}
L-m+l
x Pr{Y(O) = x,l(O) = i}Pr{

k=1
i M'-, D(z)m-l L
M'_l M'+lx-vJ-M'-l-x
+ L L (wminU.M'-X-d,M') _ ZX+d-M'W i )
..l=D ;=0 dd1
X Pr{Y(1) = x,/(l) = i} Pr{DL _ m+2 = d}
m_1 M'-l M' M'_1--x
+ LZ(k+l)M'_V D(Z)"'-k L L L (wmin(i.M'-X-d,M') _ ZX+d-M'wi)
4:=2 xd} ;=0 d=O
X Pr{Y(k) = x,/(k) = i} Pr{DL + 1_ m+ k = d}
L
M'_l M' M'_x_l
+ L L ZX+d(W X+d -wi)xPr{Y(m)=x'/(m)=i}Pr{DL +1 =d}}

xd) bx +1 d::O
/{ZN_D(Z)L+l}, (13)
where
L-m+l
Y(O)=X_,Y(I)=[Y(O)+ LD.-M+vt,
;=1
Y(k) =[Y(k-I) +DL+k-m -M t, 2~ k ~ m,

L-m+l
1(0) = P_,/(1) = [M -v- Y(O)- L D.t + 1(0), (14)
;=1
I(k) = min{[M -Y(k -1) - D 4k _ m r + I(k -I),M} 2~k ~ m,
D(z) = E[ZDk] for k = },2,3,···, Iz121, Iw1 21, [xr = min(O,x) and if m=2(m=I), the
third (and the second) term of the numerator in (13) vanishes.
4 AN ALGORITHM FOR COMPUTlNG THE PERFORMANCE

EVALUATION
We devise an algorithm for computing the stationary distributions based on the

p.g.f. (13).
Define functions a (z,w) and ;3(z) by the numerator and denominator of the
p.g.f. X(z,w), respectively. The p.g.f. X(z,w) has NX (M' + I) unknown values:
Pr{Y(O) =x,J(O) = i} O~ x ~M -v -I, O~ i~ x,
Pr{Y(l) = x,J(l) = i} 0 ~ x ~ M' -I, 0 ~ i ~ M +[x - vr,
Pr{Y(k)=x,J(k)=i} O~x~M'-I, O~i~M, 2~k~m-l, (15)
and
The probability generating functions E[zx~] and E[w&] are given by
L'Hospital's theorem as follows:
E[zx~]=X(z,l) and E[wP~]=limX(z,w)=a'(I,w)Iß'(l). (16)
z-->l
where a '(z,w) and ;3'(z) denote the first derivatives of a and ;3 with respect
to z, respectively. From Rouche's theorem and the continuity of E[w&] (lwI2 1), a
(z,w) satisfies the following identities that
a(z.,w)=O, I ~n ~N, Iwl~l,
where ~,I Zn k I for I ~ n ~ N -I and ZN = I are roots ofthe equation ;3(z) = O.
Define ak(Zn), 0 ~ k ~ M' as the coefficient of w k in a(Zn,w). Then we can
determine the unknown values (15) by solving the following system of NX
(M' + 1)+ I linear equations :
d(I,I)=ß'(l) and ak(Zn)=O, O~k~M, l~n~N, (17)
where one of the equations a k (zn) =0 is redundant.
Moreover, the expectation E[X~] is also obtained by
E[X~] =!im dd X(z, I) ={a"(1,I) -
z-->l z
ß"(1)} 12ß' (1), (18)
where a "(z,w) and ;3"(z) denote the second derivatives of a and ;3 with
respect to z, respectively. It follows from (6) that
E[P"] = D (19)
and
Pr{p"=k}=dk(l)Iß(l), O~k~M', (20)
where d k(l) is the coefficient of w k in a' (1, w).
The basic relation among &, J k and Xk implies that
.1
L iP{X~ = i} + M(l- L Pr{X~ = i}),
M~
E[J~] = E[B..] = E1X~] - E[J~]

;=0 ;=0
Performance evaluation oi a JfT production system 321
M
and Pr{B.. >O} =1- LP{X- =i}. (21)
;=0
where the values Pr{ X_ = i}, that iso Pr{ Y(O) = i}, 0 2 i 2 M. can be deterrnined by
(16).
Moreover. we obtain from (1) and (19) that
E[I_l =N - LD. (22)
Therefore. an algorithm for computing the performance of the JIT production
system is as folIows:
Stepl. Determine roots Zn. IZn I < 1 for 1 2 n 2 N-l of the equation ,: - D(Z)L+l =0
byan appropriate method such as Newton's method.
Step2. Determine NX (M' + 1) unknown values:
Pr{Y(O) =x,l(O) =i} O:S; x:S; M -v -1. O:S; i:S; x.
Pr{Y(1) =x,l(I) =i} O:S;x :s;M'-I. O:S; i:s;M +[x- vr.
Pr{Y(k)=x,l(k)=i} O:S;x:S;M'-l. O:S;i:S;M. 2:S;k:S;m-l.
and
Pr{Y(m)=x,l(m)=i} O:s;x:S;M-l. x+l:S;i:S;M.
by solving (17).
Step3. Compute E[X_l. E[p_l. E[l_l. E[B..l. E[/_l. Pr{B.. > O}, Pr{p.. = i}
0 2 i 2 M' by (14). (18) through (22).
5 OPTIMIZATION OF THE NUMBERS OF KANBANS
Tbe JIT production system adapts to variable demands at a small cost by

production smoothing (Monden. 1993). Through production smoothing. the stages
can reduce idle time or overtime costs of workers or machines. We call these costs
related to production quantities "production fluctuation costs" and include them in
a cost function of the JIT production system.
Suppose that the ordered quantities. Po. ...• P.. L are given. Then. a standard
cost function over K periods is as folIows:
K
A(M.N.K) =E[L{A[(/t -Pt /2) + B[(M -lt )+ABBt

t=\
M'
+Ao~_\ +AW~_L_\ + LAp(i)Pr{~ =i}

j=O
L
+ CB/{Bi > O}+ Cow (M.N)} +As (/K - PK)+ LAE(i)PK-i 1. (23)
;=1
where /{H} is the indicator function of event H. that iso /{H}=1 if H occurs;=O.
otherwise. In addition.
Al : the inventory cost of one part per period.
BI : the inventory cost of one product per period.
AB : the backlogged cost of one product per period.
Ao : the ordering cost of one part,

A w : the withdrawing cost of one part,
A p (i) : the production fluctuation cost per period when the production quantity is i.
CB : the backlogged cost per once,
As : the salvage cost of one part at the end of period K,
AE(i) : the salvage cost of one part elapsed i periods after the ordering at the end
ofperiod K,
and
Cow(M,N) : the fixed cost per period of storage space, ordering and withdrawing
when the numbers of Kanbans are M and N.
We consider the average cost per periods over an infinite planning horizon in
this paper. The average costs per period, A(M,N) is defined by
A(M,N) = limsupA(M,N,K)/ K. (24)
K--+~
Under the stability condition (12), distributions of Bk' I k , and J k also converge to
their own stationary distributions, as k tends to infinity, and denote by B.., I~, and
J ~ random variables with the stationary distributions. Then it follows from (23)
and (24) that
A(M,N) =A/(E[I~] - E[P~]I2)+ B/(M - E[J~])+ AaE[B..]
+ A w )E[P_] + L Ap (i) Pr{p_

M'
+ (A o = i} + Ca Pr{B_ > O} + C ow (M, N)(I)

;=0
Consider the case where N> (L+ l)M'. Since by (3), the production quantity in one
period cannot exceed M', the (N-(L+ 1)M') parts are always stored as the dead
stock. That is, for N> (L+l)M', A(M,N) = A(M,(L+ I)M) + A/(N -(L+ I)M).
Consequently, in the following of this paper, it suffices to consider only the case
where N 2 (L+ 1)M' .
Thus, if we obtain the stationary distributions and expectations of random variables
in (25) by the algorithm devised in Section 4, we can caIculate the value of (25)
and can determine optimal numbers of Kanbans, M· and N· that minimize
A(N,M).
6 NUMERICAL EXAMPLE
The algorithm devised in Section 4 is applied to the JIT production system with the
average demand D =7, the lead time L =4 and the production capacity C = 10. The
stable condition (12) implies that M > 7 and N> 35. The distribution of the demand
Dk ' k = 1,2,3,.·· is a shifted binomial distribution:
Performance evaluation of a JfT production system 323
2
Pr{ q = D - I n + j} = j (nXl)n
2 ,0 ~ j ~n
where n is an even number less than or equal to 2D. The expectation is D and The
variance is n/4. For example, in the case where n = 8, (12 is n/4 = 2.0.
Figure 2 shows the distributions of the total backlogged demand as functions of
N with M = 10. Clearly, decreasing the number of the supplier Kanbans increases
0.30
0.25
0.20
Prob. 0.15
0.10
16 18
total backlogged demand
Figure 2 Probability distributions of the total backlogged demand for M = 10
0.35
Prob.
prodUCI quanlily
Figure 3 Probability distributions of the production quantities for M = 10
0,40
0.35
0,30
0,25
Prob.
prodUCI quanlilY 10
Figure 4 Probability distributions of the production quantities for N =36

the total backlogged demand. The expectations in the case where N 36, 40, 45 =
and 50 are 10.37,7.08,7.00 and 7.00, respectively.
Figure 3 shows the distributions of the production quantities as functions of N
in the same case as in Figure 2. The variance of the product quantities increases, as
the number of supplier Kanbans increases. The variances in the case where N =36,
40,45 and 50 are 1.51, 1.91, 1,97 and 1.97, respectively. Similar results are shown
in Figure 4 in the case where N = 36 and M =8, 9 and 10.
The cost parameters in (25) are set as follows:
A/=I,B/=10, As=O, .40+ Aw =l, Cs =100,
50(i - 8) 9.S i ~ 10
{
Cow(M,N) = 0 and Ap(i) = 0 O~ i ~8 .
Figure 5 shows the behavior of costs in (25) as functions of N with M = 10. The
inventory and ordering cost and the production fluctuation cost increase but the
backlogged cost decreases, as N increases.
Figure 6 shows the behavior of minimum average costs A(M, N*) as functions
COSI
80
'. ...... vetage Cost

-_... - ..-.--
-
...... - ..
_......
60
~.-
-
In bnOl}' bcIOrd ng I
40
~
. "cd os,
20
-_..... --.--
'--.
...
...
-....- --.-. -.-.
I<!uction Fluc\ua Im C
1--..--
I
-....-.
36 37 38 39 40 41 42 43 44 45 46 47 48 49 50
N
Figure 5 Behavior of costs for M = 10
Minimun Average Cost

90
N~
so f'N •• 36
. ./ ~
r\
70
~=37
~
\ Zs
60
~
50
* Hf··39
40
10 11 12 13 14
Figure 6 Behavior of A(M, N* )

Performance evaluation 0/ a JIT production system 325
of M. The minimum average costs is attained at M indicated by "*,, in Figure 6.

This figure shows that the optimal numbers of production-ordering Kanbans and
supplier Kanbans are M' = 9 and N" = 39, respectively.
7 CONCLUSION
In this paper, we deal with the IIT production system where the production-
ordering Kanbans and withdrawal Kanbans are used. Under the stochastic demand
and deterministic processing time, the probability generating function of the
stationary distribution of the total backlogged demand and the production
quantities is derived as the two-dimensional complex valued function. The
algorithm for computing the performance of the IIT production system is devised
based on the p.g.f. Moreover, we consider the time average cost function with the
production fluctuation cost and optirnize numbers of two kinds of Kanbans.
Numerical results illustrate the performance of the JIT production system and
optimal numbers of two kinds of Kanbans are deterrnined by using the devised
algorithm.
8 REFERENCES
Bitran,G.R. and Chang,B. (1987), 'A mathematical prograrnrning approach to a

deterrninistic kanban system', Management Science, 33, pp.427-441.
Cohen,I.W. and Boxma,OJ. (1983), Boundary Value Problems in Queueing
System Analysis, North-Holland Publ. Co., Amsterdam.
Deleersnyder,I.L., Hodgson,T.I.,Muller(-Malek),H., and O'Grady,PJ. (1989),
'Kanban controlled pull systems: an analytic approach', Management Science,
35, pp. 1079-1091.
Karmarker,U.S. and Kekre,S. (1989), 'Batching policy in kanban systems', Journal
ofManufacturing Systems, 8, pp.317-328.
Kimura,O. and Terada,H. (1981), 'Design and analysis of pull system, a method of
multi-process production control', International Journal of Production
Research, 19, pp.241-253.
Kirkavak,N and Din~er,C. (1996), 'Performance evaluation models for single-item
periodic pull production systems', Journal of the Operational Research
Society, 47, pp.239-250
Mitra,D. and Mitrani,1. (1990), 'Analysis of a kanban discipline for cell
coordination in production lines. 1', Management Science, 36, pp. 1548-1566.
Mitra,D. and Mitrani,1. (1991), 'Analysis of a kanban discipline for cell
coordination in production lines. 11', Operations Research, 39, pp.807-823.
Monden,Y. (1993), Toyota Production System, Second Edition, Norcross,GA:
Industrial Engineering and Management Press.
Ohno,K., Nakashima,K and Kojima,M. (1995), 'Optimal numbers of two kinds of

Kanbans in a JIT production system', International Journal 0/ Production
Research, 33, pp. 1387-1401.
Tayur,S.R. (1992), 'Properties of serial kanban systems', Queueing Systems, 12,
pp.297-318.
Tayur,S.R. (1993), 'Structural properties and a heuristic for kanban-controlled
seriallines', Management Science, 39, pp. 1347-1368.
Wang,H. and Wang,H.-P. (1990), 'Determining the number of kanbans: a step
toward non-stock-production', International Journal 0/ Production Research,
22, pp.2101-2115.
9 BIOGRAPHY
Mitsutoshi Kojima received B.S. and M.S. degrees in engineering from Nagoya
Institute of Technology, Nagoya, Japan, in 1989 and 1991, respectively. From
1991 to 1994, he was a Computer Engineer with Fujitsu Limited, Numazu, Japan.
Since 1994, he is a Research Associate with the Department of Systems
Engineering, Nagoya Institute of Technology. His research interests include
application of queueing theory to production systems and design and analysis of
next generation production systems.
Katsuhisa Ohno received the B.S., M.S. and Ph.D. degrees in operations research
from Kyoto University in 1964, 1966 and 1973, respectively. From 1966 to 1967,
he was an Industrial Engineer with Toyota Motor Company and in 1967 he was a
Research Assistant with Osaka University. From 1968 to 1984, he was a Research
Assistant and then an Associate Professor with Kyoto University. From 1984 to
1986, he was a Professor with Konan University. Since 1986 he has been a
Professor with Nagoya Institute of Technology. His research interests include
queueing networks, dynamic programming, Markov decision processes, production
management, Just-In-Time production systems and next generation production
systems.
Prof. Ohno was a member of the Editorial Advisory Board of Transportation
Research and an Associate Editor of J. Operations Research Soc. Japan. He is now
Associate Editors of Belgian J. Oper. Res. Stat. Comp. Sci. and of Int. J.
Engineering Design and Automation.
Kenichi Nakashima received B.S., M.S. and Ph.D. degrees in engineering from
Nagoya Institute of Technology, Nagoya, Japan, in 1990, 1992 and 1995,
respectively. From 1995 to 1996, he is a Research Associate with the Department
ofIndustrial Management, Osaka Institute of Technology. Since 1996, he has been
an Assistant Professor. His research interests include dynamic programming,
Markov decision processes, production systems and management information
systems.
29
Games for organizationallearning in
production management
J. O. Riis, R. Smeds, J. Johansen, H. Mikkelsen
Dept. 0/ Production, Aalborg University, Fibigerstraede 16,
DK-9220 Aalborg, Denmark
Dept. o/Industrial Management, Helsinki University 0/ Tech-
nology, Otakaari 8, SF-02I50 Espoo, Finland
Dept. 0/ International Marketing and Management, Southern
Business School, Grundtvigs Alle 150, DK-6400 Sf/mderborg,
Denmark
Sant & Bendix Consulting, Skovlytoften 9B, DK-2840 Holte,
Denmark
E-mail: i9jor@iprod.auc.dk
Abstract
Development and implementation of new production management methods and
systems represents achalIenge to the individual employee, manager, student or
teacher. Understanding dynamic and complex systems is very difficult, old methods
and working habits have to be unlearned, a new kind of knowledge is required, and
it is important to acquire proficiency in doing.
The paper will discuss these issues and outlines the role which games of various
kind may play in this respect. Among other things, the use of games provides a
setting in which experimentation is stimulated without the risk of loosing face.
Finally, the use of games will be tied to the concept of organizationalleaming.
Keywords
The dynamic nature of production management; Simulation games; Organizational
leaming; Capability for rapid change.
Advances in Production Management Systems N. ()kino, H. Tamura & S. Fujii (Eds.)

1. CHALLENGES TO PRODUCTION MANAGEMENT
Industrial enterprises are increasingly challenged by the market situation and the
advancement of technology to improve their capability for implementing speedy
and substantial changes in their operation, including production management, plant
layout, production processes and organization.
Three challenges are particularly important
1. Rate of change. The rate of changes imposed on an industrial enterprise is

increasing which calls for a greater proficiency in adopting new methods and
systems and in implementing them with high precision. In addition, the rate of
change demands better ways of learning from past experience and of adopting
new knowledge.
2. Integration. The need to integrate different disciplines and perspectives across
traditional organizational boundaries in order to exploit the potential synergy,
e.g. to link production management to product design and production engineer-
ing, and to suppliers and customers in the logistic chain.
3. Involvement of employees. A greater involvement of employees to take
an active part not only in the operation but also in the development of industrial
enterprises. Terms like autonomy, empowerment, and collaborative working
modes indicate the direction of this effort.
These challenges are in contrast with the current situation in many industrial
enterprises which may be characterized by (1) a dominating focus on the day-to-day
operation and routines aimed at securing delivery on time, quality and cost effec-
tiveness - with little concem for continuous improvement; (2) management sys-
tems which are unable to support learning processes, such as collecting and
retrieving past decisions and extracting experience and lessons learned; (3) a tradi-
tion for perceiving a change as a rational, deterministic decision process, rather than
as aseries of experiments; sometimes experiments are even considered risky by
individual employees to indulge in.
Also teachers of production management are affected by the challenges to indus-
trial enterprises; conveying the complex and dynamic nature of production man-
agement has become a significant challenge. At the same time a quest for increased
productivity in teaching is imposed. Important issues are questioned, such as the
role of teachers (instructors, coach or facilitators) and the goal of education
(knowledge versus proficiency and capability).
This paper will address these challenges by discussing one approach, which by far
is not the only one, to meet these challenges, namely that of using games at
universities and in industry to stimulate learning processes in connection with
development and implementation of new production management systems and
methods. However, we need to better understand the context and processes of im-
plementation. Therefore, we shall first point to behavioural issues of implementa-
tion. This will provide a basis for delineating different roles which simulation
Games for organizationallearning in production management 329
games may plan in facilitating change. We shall also discuss experiences from
using games for implementing changes. Finally, the scope will be widened to
include a more general discussion of organizationallearning.
The signifance of the paper thus is (1) an identification of essential behavioural
issues of implementing change; (2) a discussion of different roles which simula-
tion games may play, and experiences gathererd; and (3) a relationship established
between simulation games and organizationallearning.
2. BEHAVIOURAL ASPECTS
In the following we shall outline some of the issues associated with development
and implementation of production management systems and methods, seen from an
individual, behavioural perspective.
Understanding dynamic and complex systems is difficult. A dynamic

system with delays and many interacting parts and relationships easily becomes
difficult to comprehend, even when relevant information is available, cf. Senge
(1990). In an enterprise, employees and managers are interacting. Their decisions
are often made independently, but are mutually interdependent. Therefore, an indivi-
dual employee or manager usually has only limited information of the various
elements of the system, and the decisions made based on this confined knowledge
even increase the dynamic complexity of the system.
A typical reaction on part of an employee or student, confronted with a dynamic
and complex situation, is uncertainty and fear of the unknown, bewilderment, dis-
enchantment and de-motivation. Not understanding the dynamic nature of a system
thus may be counter-productive to an effort to involve employees more actively.
Unlearning is often the first step of learning new methods and

working modes. An employee or manager in an industrial enterprise involved in
production management will have learned to operate the current production man-
agement system. Often the know-how has been acquired through on-the-job training
and many years of experience. Thus, if new methods and systems are to be
introduced, the persons involved will necessarily have to unlearn the old methods
and working modes.
Also students may need to unlearn, even if they are confronted with production
management for the first time. Their prior education may have given them the
conviction, for example based on basic courses in physics, that everything may be
quantified, and that there is always one correct solution. Furthermore, a student may
have acquired the point of view that any problem may be completely described by
adopting only a single person's view andjust one perspective.
To unlearn may be a difficult process. When we analyzed the reluctance of a
group of production planners to question their present mode of working, it turned
out, that many of them had worked with the MRP system during most of their pro-
fessional careers, without having understood the system completely. But they bad
learned to operate the system to some degree of success. They bad to be convinced,
that alternative methods existed and would do a better job. Unlearning may not be
successful unless the employees or managers have gained concrete experience in
operating new systems or methods.
Knowledge is still important, but which kind of knowledge? A thor-

ough knowledge is still of prime value when developing and implementing produc-
tion management systems and methods, whether it be general knowledge of
planning principles and available software systems or specific knowledge of the
operation and behaviour of a given system in a particular company situation. How-
ever, much knowledge presented to students is at the level of "heard of' or "know-
of'. Little emphasis is placed on providing students with a "know-how" level of
proficiency enabling them to apply appropriate methods and systems to specific
situations.
The knowledge of graduates is compartmentalized into weIl defined clusters or
disciplines with no capability to identify and use connecting relationships. The
challenges to production management presented in the first section of this paper
give rise to ask, if our conception of the knowledge an engineering graduate needs
to possess should not be changed accordingly, e.g. to include knowledge of how to
identify the mutual interdependencies between persons and organizational units in
production management, or knowledge of how to integrate different disciplines and
perspectives.
Individual proficiency in doing, and organizational capability.

Learning production management systems and methods as an individual skill may
be compared with learning to ride a bicycle, or learning to play the violin. A certain
portion of intellectual effort is needed to understand the basic operation of a bicycle,
but the real proficiency comes from practicing. This may be facilitated in various
ways, e.g. by two smaller wheels fixed at either side, or by the father running
behind ready to support. A textbook on bicycles may have a long chapter on how
to keep the balance. Nevertheless, nobody would ever be able to ride a bicycle just
on the basis of having read the textbook.
But proficiency is not only the individual mastering of a skilI. Human activity is
basically social. The cyclist has to be able to ride with others in the traffic to get to
his destination. The violinist plays with an ensemble to reach a common musical
vision, and improves in this interaction also the personal mastery of the
instrument. Sharing experiences is essential for learning in human systems in
general, and especially in the learning of goal-directed teams and organizations, cf.
Nonaka and Takeuchi (1995).
Thus, production management systems and methods can only be learned, if also
practiced within an organizational context. It should be of no surprise that young
graduates experience a shock when they are asked in their job to transform their
knowledge into practice. In enterprises, we can also observe a lack of shared expe-
Games Jor organizationallearning in production management 331
riences in the many futile discussions between those who have knowledge, but no
experience in doing, and those with practical know-how, but no understanding aOO
insight. This becomes evident especially in change situations, where management
spends much effort in telling employees about future changes, but with no attempt
to let them experience elements of the new system in advance to provide some
hand-on insight. The result is often resistance to change.
Experimenting without loosing face. Among engineers and managers there

exists a widely accepted notion that it is part of the professional job to show
decisiveness and to signal to the rest of the organization that no doubt exists. With
the increased complexity and turbulence in production management, it has however
become increasingly difficult to maintain the image of having everything under
control.
Much is at stake for an employee, student as weIl as a manager when a new
working mode is to be adopted. For natural reasons, the individual may have no
prior experience and may be nervous to show to others that he or she is not fully
competent. The individual may be afraid of loosing face, if unsuccessful.
Admitting the existence of uncertainties and adopting shared experimentation as an
explicit instrument for leaming could offer a new potential to manage change
processes. Hence, it is important to carry out a change process in such a way that
experimentation and play is encouraged. The opportunity to try out new methods
should be protected from serious consequences, and mi stakes should be considered
as part of the learning process.
Experimenting with prototypes throughout the innovation process is common
practice in product development projects. Also for process innovations, the
"prototyping" of new process designs in teams accelerates the innovation process
and leads to better solutions, cf. Smeds (1994).
3. THE ROLE OF SIMKULAnON GAMES

3.1 Common Experience creates Shared Perception
Simulation games may be defined as a dynamic simulation of reality during which

the participants (players) act, e.g. make decisions or produce. The actions taken by
players affect the following situation confronting the players. Games can in princi-
pIe be played alone (e.g. against a computer) or with a group, but only in the latter
case, a shared experience for leaming is created.
A large variety of different games has been used in the area of production man-
agement, in industrial enterprises as weIl as in universities, spanning from a sim-
ple, one-hour nT game demonstrating the difference between a push and a puB
system to an elaborate, several-days computer-assisted MRP-game which trains
players in using MRP for a number of situations, cf. Riis et al. (1993). Also
enterprise specific games for business process development have been used, cf.
Smeds (1994), Smeds and Haho (1995), Mikkelsen et al. (1990), Riis (1996).
In a production system game, the participants experiment and discuss the
dynamic relationships between activities. They can experience the consequences of
differentiated task structures, the unnecessary complexity in information and mate-
rial flow, of roles and systems, and the need and possibilities for improved, process-
oriented co-operation and communication. Sharing these experiences in the game
creates the shared mental models and technical skills, that enable team members to
understand their task, and to coordinate and develop them adapting their behaviour
to the demands of the process and of the team members.
3.2 Many Aspects treated
The production system games bridge inter-departmental boundaries and give the
opportunity for a process-oriented, holistic view. The games are capable of dealing
with many different aspects connected to production, such as marketing (with an
increased awareness of external threats and need for improving competitiveness),
sales (with a recognition of the importance of demand variety), product development
and engineering design (with an appreciation of the uncertainties of the development
process), purchasing (with an insight into the conditions for vendors arxl
subcontractors), etc.
If managers and employees participate in the game, the interlevel dialogue
between strategy and operation can even enable the recognition and development of
new strategic capabilities.
3.3 Transfer from Game to Reality
Games are only models of reality. The more abstract and detached from a specific
enterprise situation or from the players' experience they are, the more time-outs
during the game, as weIl as separate debriefing periods following each ron of a
game are needed to discuss and relate the game experiences and observations to the
players' own situation.
Agame provides a setting in which it is costless to experiment and to make
errors. Experimentation is encouraged, e.g. new ideas of planning and new planning
concepts may be tried out with the effect that players experience by all their senses
what the new solution might imply, without fear of criticism of own personality or
capabilities. The players can also experiment with different roles, and conflicts can
be used as learning instruments to intensify the shared experience.
4. GAMES IN CHANGE MANAGEMENT

4.1 Empowerment as Basic Principle
An underlying assumption behind using games in organizational changes is that

participation is instrumental for the success of the change process. Through par-
ticipation in the change process, a common understanding and commitment to
change is created, more viable ideas are developed, and their implementation into
innovations is facilitated, cf. Moss Kanter (1983), Zuboff (1991), Smeds (1996).
The jointly developed solutions are likely to be better both in productivity aOO
work satisfaction, and resistance to change can be avoided to a great extent, cf.
Cotton et al. (1988).
Thus, the games for production system redesign should be built based on the
basic principle of empowerment. In several enterprises, we have developed company
specific games which allow the employees to identify their own job in the game,
and to easily transfer the conclusions of the game to their own situation, cf. Smeds
(1994), Smeds and Haho (1995), Mikkelsen et al. (1990), Riis (1996).
4.2 Games can be used in all Change Phases
Games can support all phases of a change process, respectively (1) the initial phase;
(2) the design phase; and (3) the realization phase. They can also be used later for
training and continuous improvement of the new design.
1. The initial phase. Simulation games can create for all involved a com-
mon understanding of the present situation, and an awareness and need for change.
Unsatisfactory performance, e.g. in terms of poor precision in deliveries and qual-
ity, is often caused by the complex interplay of many sections and departments,
which can be jointly experienced and discussed in the game.
The game generates immediately many improvement ideas. To direct the change
process, chosen production management principles and specific change objectives
can be used as a guideline for the ideas, and later during debriefing and design.
2. The design phase. Some generic games offer the opportunity to try out
several production management principles and different planning methods, which
provide a good background for a large group of employees in a company to select a
basic solution which they feel comfortable with.
The company specific games support the design phase in a prototyping manner.
Following the general objectives of the change process, aseparate development
team converts the ideas of the initial game into a possible new process design,
which is then simulated in a proceeding game. With consecutive rounds of devel-
opment work and games, analysis and synthesis, a satisfactory design is created
with a high degree of empowerment. Thus, a significant step towards implementa-
tion is already taken in the shared mental models of the participants, before the
actual realization starts, cf. Smeds (1994).
3. The realization phase. An important activity is training of the employ-

ees who are to operate the new system. Games may not only provide a thorough
understanding of the functioning of the new system, but also give hands-on experi-
ence in operating the system under various conditions.
When the new production system is running, incremental innovations are very
likely to develop, and to be of high quality, since all employees in the process have
participated in the games and thus possess the holistic understanding of the whole
process. After the incremental improvements have reached their limits, the need for
a new major reorganization is perceived, and the development spiral is repeated.
Management needs feedback and communication about the progress of change,
and the employees need the feedback to preserve their motivation and leaming dur-
ing realization and stabilization of the new process design. The same guidelines arxl
measures that were used to evaluate the different simulated designs can also be used
as feedback indicators during realization, everyday operation, and continuous
improvement. They should if possible be converted into visual milestones, to give
the whole organization the possibility to leam from examples, cf. Riis (1990).
4.3 Precautions
A risk of using games for stimulating a change process is that players are not able
to relate the experiences to their company and to their own job situation. At worst
the game would only be considered a waste of time or aperiod of fun with no
transfer effect. Thus, the choice of game is critical. This explains our effort to
develop company-specific games.
The cost of running agame should be considered, especially the time in which
the players are away from their job. This has led us to focus attention on limiting
the duration of agame, typically from a three-day session to just one day.
5. LEARNING IN INDUSTRIAL ORGANIZATIONS
According to Nonaka and Takeuchi (1995), organizational leaming is a dynamic

conversion process between tacit and explicit knowledge into a spiral of knowledge
creation. (Figure 1)
Games for organizationalleaming in production management 335
tacit explidt
knowledge 10 l<nowledge
tacit
knowledge Sodalizati m Extemalizatim
FRCM
explidt Jntemalizatim Com1:inatim

krowledge
Figure 1 The four modes of knowledge conversion and the knowledge spi-
ral.
Simulation games support all steps in the knowledge conversion process where
tacit knowledge is involved: Socialization (sharing the individual, tacit knowledge
through the joint game experience, resulting in shared mental models and technical
skills); Externalization (making tacit knowledge explicit through conceptualization
and dialogue in the game and in the debriefings); and Intemalization (experimenting
alternative designs in games, leaming by doing, and adopting the new mode of
working into use, which means the conversion from explicit back to tacit
individual knowledge). The Combination of different bodies of explicit knowledge
into a new design is typically not conducted in the games, but in debriefings or
separate design teams.
Thus the games are one method to catalyze the crucial dialogue for learning
between the individuals' proficiency and the organization's capability. Games create
a temporary structure for leaming and innovation on both individual and organiza-
tionallevel. The game team is like an orchestra that rehearses the musie together to
bring it to the shared vision. If top management partieipates in the game, a
strategie innovation, a new "composition", may emerge in the experimental dia-
logue between strategy and operation.
The formal management systems, e.g. production management systems, have a
great influence on the collective leaming processes. Therefore, it is important to
understand their role and interplay between individual informal leaming, as dis-
cussed in Neergaard (1994).
The authors are of the opinion that simulation games are an important method
for ereating the organizational leaming spiral for the eontinuous development of
industrial enterprises. In addition, and perhaps even more importantly, by applying
games in the development of production systems, an increased understanding of

organizational learning in industrial enterprises may also emerge.
6. CONCLUSION
In this paper we have addressed the challenges confronting industrial enterprises of

speedy adoption of new methods and systems for production management. In view
of its dynamic and complex nature this is a difficult task. Also teachers of
production management are affected by these challenges.
To be effective in developing and implementing new methods and systems it is
necessary to understand the individual employee, manager, student or teacher. In
section 2 we discussed that an individual or a group often is unwilling to adopt new
methods and working modes, before the old methods and habits have been
unleamed. Furthermore, the proficiency of doing and not just knowing was stressed,
like leaming to ride a bicycle or play an instrument in an orchestra. In view of the
complex nature and the lack of knowledge we argued that it was important to create
a setting in which experimentation is possible without loosing face.
One way of dealing with some of these issues is to use games of various kind in
different situations. Section 3 and 4 summarized what games may do in connection
with training new proficiencies and with organizational changes. Among other
things it was argued that games provides a common experience which creates shared
perceptions. Furthermore, it was demonstrated that games may be used in all phases
of an organizational change process. In the last section the paper related games to
selected aspects of organizational leaming with particular focus on the
transformation of individual tacit knowledge to explicit, collective knowledge. Also
it was stated that an increased understanding of organizational leaming may emerge
by applying games.
7. REFERENCES
Cotton, J.L., Vollrath, D.A., Froggatt, K.L., Lenginck-Hall, M.L., Jennings,

K.R. (1988): Employee Participation: Diverse Forms and Different Outcomes,
Academy of Management Review, Vol. 13, No 1, pp. 8-22.
Mikkelsen, Hans, Lars Mitens and Jens O. Riis (1990): Simple, company-specijic
games for developing production management (in Danish), Aalborg University
Press.
Moss Kanter, Rosabeth (1983): The Change Masters. Innovation and Entrepreneur-
ship in the American Corporation. Simon & Schuster, Inc., New York.
Neergaard, Claus, 1994: Creating a Leaming Organisation - A Comprehensive
Framework, Ph. D. dissertation, Dept. of Production, Aalborg University,
Denmark.
Nonaka, Ikujiro and Takeuchi, Hirotaka (1995): The Knowledge Creating Com-
pany, Oxford University Press, Oxford.
Riis, Jens O. (1990): The use of production management concepts in the design of
production management systems, Production Planning and Control, 1990, Vol
1, No. 1,45-52.
Riis, Jens 0., John Johansen and Hans Mikkelsen, (1993): Games in Production
Management, p. 209-216 in Advances in Production Management Systems,
IFIP Transactions B-13, North-Holland.
Riis, Jens O. (1996): Games for implementing changes in industrial enterprises, p.
72 - 84 in The Simulation and Gaming Yearbook Volume 4 - Games and
Simulations to Enhance Quality Leaming, Edited by Danny Saunders, Fred
Percival and Matti Vartiainen, Kogan Page
Senge, Peter M. (1990): The Fifth Discipline. The Art & Practice of the Leaming
Organization, Doubleday, New York.
Smeds, Riitta (1994): Managing Change Towards Lean Enterprises. International
Journal ofOperations and Production Management, Vol. 14/3, pp. 66-82.
Smeds, Riitta (1996): Successful Transformation: Strategie evolution management
for competitive advantage, Business Change and Re-engineering. The Journal
ofCorporate Transformation, Vol. 3, No 2,62-72
Smeds, Riitta and Haho, Päivi (1995): Tailored order-to-delivery process game, in
J. Riis (Ed.) Simulation Games and Leaming in Production Management,
Chapman & Hall, London, 145-155.
Zuboff, Shoshana (1991): Address in the debate: Can Research Reinvent the Cor-
poration? Harvard Business Review, March-April, pp. 164-165.
8. BIOGRAPHICAL NOTE
Jens o. Riis is a Professor of Industrial Management Systems at the Department of

ment, project management, and integrated production systems. He worked with
John L. Burbidge in the late 80's on integration in manufacturing and exchanged on
many occasions ideas and experiences about forming production groups. Prof. Riis
is currently heading two research programs in integrated production systems and
technology management, and is a member of the IFIP Working Group 5.7 on
Computer Aided Production Management Systems and of the international editorial
board of several international journals.
Riitta Smeds is the head of the new Enterprise Simulation Laboratory at Helsinki
University of Technology, TAI-Reserach Centre. She has acted a associate
professor and lecturer of Industrial Management at HUT, and acts currently as

professor at the Swedish School of Economics and Business Administration,
Department of Management and Organization. Riitta Smeds holds a M.Sc., a
Lic.Tech. and a D. Tech in Industrial Management from HUT. She is a member of
the International Foundation for Production Research IFPR, of the European Group
for Organizational Studies EGOS, and of IFIP Working Group 5.7 on Computer
Aided Production Management Systems. She is also a member of the editorial
board of "Knowledge and Process Management, The Journal of Corporate
Transformation". Her main research areas are enterprise evolution, management of
technology and innovation, organizationallearning and change, business process re-
engineering, and enterprise simulation me~ods.
John Johansen is a professor of Industrial Management at the Department of

International Marketing and Management, Southern Denmark Business School. He
holds an M.Sc. in Engineering and a Ph.D. in Industrial Management from the
Aalborg University. His main area of teaching and research are Production
Management, Production and Material Control, and Supply Chain Management.
Professor John Johansen is a member of the IFIP Working Group 5.7 on Computer
Aided Production Management Systems.
Hans Mikkelsen is a Senior Consultant at Sant + Bendix, a member of Coopers &

Lybrand. He holds an M.Sc. in Mechanical Engineering from the Technical Uni-
versity of Denmark and has been involved in consultant work and development
projects in the areas of design of production system, production management sys-
tems, project management and product development both from a system's per-
spective and from an organizational and management point of view.
PART SIX
Production Planning
30
Production planning system coping
with changing customer requirements
Mitsuhiro Enomoto, Hideaki Matoba, Hirotaka Morita

and Tetsuji Segawa
Production Information System Department,
Production Engineering Research Laboratory, Hitachi, Limited
292 Yoshida-cho, Totsuka-ku, Yokohama 244, Japan,
Tel; +81-45-881-1241 Fax:+81-45-860-1621
E-mail: mitsu@perl.hitachi.co.jp
Abstract
This paper presents a reactive production planning system that reassigns material
and production load to shops rapidly according to changes of order, and then adjusts
the schedule or production so as to result in a feasible schedule. First, a shop by
shop MRP calculation system that considers production load and capacity of shop
facility is explained. Next, adecision support system which allows for changes in
the MRP-derived schedule is explained. Finally, experimental results such as
calculation times for this system are presented.
Keywords
Intelligent CIM, MRP, Reactive scheduling
1. INTRODUCTION
Market conditions such as product life cycle and short delivery time are changing
and customers now demand unique or customized products more than ever.
Manufacturing industry must respond to this situation by developing the next
generation production planning systems which can handle a large variety of products
in a lust In Time environment [1] [2] by integrating, end sales and production
information.
342 Part Six Production Planning
We are pushing forward with such CIM system developments by using a broad
sales support information network with the purpose of improving lead time
estimation accuracy and reducing total order to delivery lead time [3].
The first issue we addressed was to improve lead time estimation accuracy by not
relying on fixed standard lead times in production planning, but using ones which
is proportional to production loads and facilities status. The second issue was to
adjust a production plan rapidly, in terms of product type, volume and completion
date to cope with customer requirements changing. For this purpose, we developed
the reactive production planning system. The characteristics of this system are as
folIows:
(1) Proposal of a daily production plan using dynamic lead times which reflect
production load and facility capacity . The MRP calculation is carried out
using these dynamic lead times and a daily schedule is put forward correctly.
(2) Decision support system. If problems (e.g. capacity andlor parts shortage)
occur due to a change in the production plan in accordance with customer
requirements, they must be rectified rapidly. In order to rectify these
problems, we have developed decision support system to analyze capacity
and parts shortage and to propose a countermeasure by canceling order
andlor changing the due dates and order sizes for lesser priority (e.g. Non-
reserved) planned orders.
In the following sections, we will describe these characteristics of the reactive
production planning system.
2. PROCESSING METHOD
2.1. System axiOIm

The system's axioms are:
(1) A factory is made up of a number of shops and organized by shop groups.
(2) One shop group contains at least one shop.
(3) All shops capable ofprocessing the same part are members ofthe same shop
group.
(4) Shop groups can be placed in an order such that each group only gets parts
from groups lower than itself in the hierarchical ranking.
Figure 1 shows the MRP tree for a part p9 in a factory consisting of seven shop
groups (organized in hierarchical order).
2.2. Scheduling calculation
As an example, the calculations required to schedule an order for a number of p9
parts will be described.
Production planning system and changing customer requirements 343
Figure 1 Structure of shop group in factory
Assurne that an order for five p9 parts are to be produced by the end of Friday June
10. The calculation must be done on Monday morning, June 6, before the detailed
work schedule for that day has been drawn up. The calculation begins with the top
shop group in the factory, in this case shop group A. The calculation for each shop
group is done by a two-step process:
Step 1: Shop Load Completion and Net Calculation.
For shop group A , a "Completion Shop Load" (figure 2) diagram is produced,
which shows which parts must be completed by each day. In Figure 2a the part p9
appears again in other parts in the column for June 10, ( its "due date"). The Net
Calculation routine scans the Completion Shop Load from left to right and from the
bottom of the columns to the top to get total number of the parts and assigns
available stock to jobs. The system now knows that five p9 parts must be made.
Step 2: Beginning Date Calculation.
The next step is to schedule the work in the completion shop load and using this
calculates when the child parts, which are components of the higher parts like p9,
need to be ready by backtracking using a dynamic lead times. This is called the
"Begin Date" Calculation.
The calculation is carried out from right to left, and from the bottom of the
colurnns to the top through the shop group.
6 7 8 9 10
June
Block height is proportional to the
number of parts to be made times
the time needed to make one.
8am 10 2 4pm
(2a) Completion shop load (2b) schedule
Figure 2 Completion shop load and schedule for Shop Group A
The system output for 10th of June is represented in Figure 2b, and as can be seen,
job spills over into the previous day (inside of the circ1e in figure 2b). Figure 2b
shows a continuous 8 hour shift and contains the same jobs that appeared in the
completion shop load diagram, but now with quantified production times. The use
ofparallelograms is an auempt to represent what actually happens in the factory.
Figure 3 provides a detailed view of the production of each of the five p9 parts in
shop group A. Parts p5, p4 and p7 are prepared at 11 am at the loading point of the
shop, where they wait (expressed by the horizontalline) until the previous job (from
other order) has cJeared the loading station. In the case of parts p9, let assume it
takes 12 minutes in process. This is called the "cycJe time". Processing
commences at 11 :12am. Over the next 30 minutes (termed "one (part) lead time")
the parts progress from the start to the finish of the shop, and apart p9 emerges at
11 :42am; the constituent parts cease to exist. Meanwhile back at the loading point,
the second set of parts wait to be processed, eventually being released at 11 :24am
and finishing one cycJe time behind the first job at 11 :54am. The fifth job is
finished at 12:30pm, however the first part of the next job began before then
(actually releasing at 12: I2pm). Consequently, for this job the finish time is
12:30pm and the "begin time" is Ilam. The difference between these times is
equal to one lead-time plus five cycJe times (30 minutes plus 5 times 12 minutes
equals 90 minutes).
begin time
I
r'
I I
'~d '111:42
I I
"1",
I t tII
1
11:54
I I I
finish time
12:30
I
'I
t
;1///1
Finish
61-,--,--,(5) 8am 10 12 2 4pm
Start I I I I I I I I I I I I I I I
11 t t 12
~211;24
cycle time
Figure 3 Production schedule for part p9 in Shop Group A.
Referring back to Figure 2b, at the left hand side, jobs spill into the previous day
(lune 9th). Therefore when work is scheduled for that day (in this shop group) it
will be displaced to the left by the size of the spill (inside of the circle in figure 3).
A schedule is termed as being "unbalanced" if work spills to the left from the
earliest day in a shop group, across the "Today deadline". Such jobs have, in effect,
been scheduled yesterday.
The position of each job in the Completion Shop Load diagram determines where
it appears in the schedule which is used to calculate the job's begin date.
3. DECISION SUPPORT SYSTEM
3.1 Decision support for shortage of production capacity

1) Pick up of candidate orders
As shown in figure 4, in the case of a shortage of production capacity, it can be
said that there is an overload in the production order of the current day (first
day).The overloaded capacity of the first day is caused not only by requirements for
the day itself but also by continuous capacity overloading in the advanced dates.
Therefore, in any duration in which there is continuous capacity overloading in each
subsequent day, the capacity for an existing process will have been exceeded. In this
duration, any orders of lesser priority (e.g. Non-reserved) are candidates for
replanning as a countermeasure against such overloading.
2) Resolving a sequence of consecutive daily overloads

It can be seen in figure 4b, that total work overload for a particular period of days
increases if the load of any day exceeds the load capacity, and conversely, it
decreases if any day's load is less than the capacity. The final total overload for
the whole time period is derived by shifting the overload of the last day to the
previous day (indicated in figure 4b by the moving grey areas), reca1culating the
overload for that previous day, and repeating the process until the cumulative
overload for the period has been completely shifted to the first day (indicated by
dark shaded area). FinaIly, the overload is distributed over several parts of the
whole period. The period is subdivided (as shown in figure 4c) whenever the
forward shifted overload for any day is smaIler than the ca1culated minimum. For
example, period (X) is set when the overload drops below the amount m. For the
next period (Y), a new minimum overload (equal to n) is then ca1culated.
(n-l) (n) day

range of overload solving planning order
(4b)
/ minimum overload at each point of time "\
• time-series amounts
~t J ~. 11 - . .*. n. ofsolved
overload to be
"-
I li
t-
I- -
- ... ---
(X) (Y) day
(4c)
Figure 4 Decision support for shortage of production capacity
The system then can decide the total amount of overload by spreading out load m
over duration (X), or by spreading out amount n over duration (Y) and amount (m-
n) over duration (X).
3.2 Decision support for shortage of parts

1) Pick up of candidate orders
As shown in figure 5, when a shortage of parts occurs, stock or scheduled stock is
less than the required amount for a particular day such as on the (current day +1) and
the (current day +3). The total duration of a shortage is defined from the present
day to the last day in which a shortage occurs in this case (current day +3).
During this duration, any orders of lesser priority (e.g. Non-reserved) are candidates
for replanning as a counterrneasure against such shortages.
+3 +4
required 40
stock~scheduled 40
difference o
range of shortage solving planning order
time-series amounts of
shortage to be solved
Figure 5 Decision support for shortage of parts
2) Resolving a duration of stock shortages

The duration of stock shortages is subdivided in to periods running up to the last
consecutive day of a shortage. For instance, in figure 5, aperiod with shortage of 10
runs from the current day through (current day+l) and aperiod with shortage of 20
extends from (current day +2) through (current day +3). The parts requirement for
these periods can be reduced by 10 and 20, respectively, or the total shortage of 30
for the duration can be reduced during the first period from current day to (current
day +1).
3.3 Decision support system

If the total amounts of overload and of shortages, calculated above, are less than
total postponable loads and parts requirements (e.g. for non-reserved orders) during
the duration, we can make a feasible production plan by canceling orders and/or
changing the due dates and order sizes for candidate planned orders. Then,
considering what candidate planned orders are available and using an objective
function for minimizing the number of canceled planned orders and the amount of
overstocked parts, the system uses the vector method to automatically choose the
candidate planned orders.
4. PRODUCTION PLANNING SYSTEM
4.1. Structure of the system

Figure 6 shows how this system can make possible adjustments and produce trial
schedules. Rectifying adjustments must be made if a planner detects jobs spilling
across the "Today deadline" (in the "Gantt Chart"). Possible adjustments are:
(1) change of shop capacity
(2) change of shop for process
(3) change of order's due date
(4) change of order's priority
(5) change of orders size
(6) adjustment ofMPS (add/cancel)
Order r Sales support networ

Allocatio,!! . r
Customer I PISales department I
"-
Production plan )
-{ Factory }
-Due date
lt Status of order
1
Decision Suppon System I [Adjustment method] I MPS planning system I
I ( .
1 '
__ Calculation MPS
system
t)Problems
2)Adjustmenl guide
[ change of shop for process
( change of shop capacity·
. Gantehart
J I Lead time sening
module I
3)Adjustment resull
i-" Aexible lead
--
loday 10121 11/4
time
shopl
Work station c
I
Shop load
•
shop2
\.Q.J Planner
shop3 .delay-=
MRP calculation
module I
Figure 6 Structure of production planning system
To help these types of coordination, we have developed a graphical interface in
which the user can easily find the problems in the production schedule by surveying
the status ofthe shop for each day. All coordination can be directed by mouse input.
Furthermore, in order to obtain a better man-machine interface, we have tuned the
MRP program faster so as to make the coordination and MRP calculation cyc1e short
by maximizing information storage in workstation RAM and minimizing hard disk
access frequency. As a result it has become possible to plan the production
schedule with immediate feedback regarding the required changes in manufacturing
resources.
5. MRP CALCULAnON TIME EXPERIMENT
This system is an interactive production planning system, i.e. adecision support

system for a feasible production planning. Calculation times for this system were
experimentally measured by implementing the system on a work station with a
131MIPS CPU and a 64Mbyte RAM. Figure 7 shows the results of calculation times
required to generate production plans.
MPS order count: 2000

Planning period : 3 monthes
total number of parts
I CPU: 131MIPS, Memory: 64Mbytel

Figure 7 MRP calculation time used for production plan regeneration
The x-axis, the y-axis and z-axis represents the total number of parts, the total number
of parts per order, and the calculation time respectively. We have also studied the time
for a net-change calculation, which is a calculation to be necessary for only the
difference of orders from a previous schedule, as it might potentially be more
important since the net-change calculation is used in the iterative cycle of adjustment
and result checking. The calculation time turned out to be, at most, one seventh of the
time needed for production plan regeneration. We assumed it will be able to be of
practical use in daily.
6. CONCLUSION
We have developed the reactive production planning system that reassigns

material and production capacity rapidly considering priority of planning order. This
system has the following characteristics.
(1) It performs shop by shop MRP calculations using appropriate lead times
based on shop load and capacity data in stead of fixed lead times and
generates a reasonable production plan.
(2) It provides adecision support system to analyze capacity and parts
shortages, and support functions to resolve these shortages.
(3) The calculation time of this system is tolerable for daily practical use as
verified experimentally.
7. REFERENCES
L.A. Al-Hakim, B.W. Jenney, "MRP: An Adaptive Approach," International

Journal 0/ Production Economics, 25 (1991) pp. 65-72.
2 D.N.P. Murthy, L. Ma, "MRP with Uncertainty: A Review and Some
Extensions," International Journal 0/ Production Economics, 25 (1991) pp. 51-
64.
3 H.Matoba, M.Enomoto, "Flexible Order-In Production Planning System,"
APMS '93 Proceedings, 1993, B-13, pp. 177-184.
8. BIOGRAPHY
Mitsuhiro Enomoto was born in 1964. He received a B.S. degree in 1986 and M.S.
degree in 1988 in Industrial Engineering from Tokai University. He is a researcher
at the Production Engineering Research Laboratory, Hitachi, Ltd. His present
interests include production management system. He is a member of JIMA.
31
Production planning and control on
the basis of control theory
Hans-Peter Wiendahl and Jan- Wilhelm Breithaupt

Institute 0/ Production Systems, University 0/ Hanover
Callinstr. 36, 30167 Hannover, GERMANY,
Tel: +49-511-762-2440 Fax: +49-511-762-3814
E-mail: wiendahl@ifa.uni-hannover.de
Abstract
Control theory provides excellent tools to analyse and control dynamic systems.
Usmg the funnel model and the theory of the operating characteristic curve, a
continuous model of a production system was developed. Based on this model two
controllers were designed to control backlog and WIP. Simulation experiments
have confrrmed that this concept ensures the synchronisation of capacity and work.
A suggestion on how to integrate the strategy into PPC on the planning level is
discussed in the following. The objective of this approach is to develop the present
open loop control realised in PPC into a closed loop cootrol.
Keywords
Production model, Automatic production control, APC, PPC, Logistics, Continuous
model
1 INTRODUCTION
The continuing structural changes in society and thereby, also in the production
environment contain new challenges which companies have to face with innovative
approaches in order to remain competitive in the future. These changes affect the
categories: product, market, production location and process. A long term study
published in 1993 by McKinsey illustrates that the international competition is
based upon three essential pillars: price, quality and time (Rommel, 1993).
From the above, the factor, time, experiences growing importance. But also the
logistical quality features, delivery time and delivery reliability, appear increasingly

as differentiating criteria in the market. A further decisive point is the increasing

demand for the flexibility with respect to the customer wishes.
Companies and research are therefore called upon to develop their own inno-
vative ideas and to expand them to new tools and procedures. In the following a
new perspective is pointed out under the catchword automatie production control
(APC), which can be helpful in improving a companies competitiveness in the
future. Tbe aim of this approach is to design a self-controlling production model
based on control theory.
A couple of models for production control have already been developed. Tbey
failed, due to a missing dear definition of the interdependencies between the
reference and control variables (transmission functions). In this approach the
transmission function of the system can be defined by using the logistic operating
curve which has been developed at the Institute of Productions System at the
University of Hanover.
2 A CONTINUOUS MODEL OF A PRODUCTION SYSTEM
2.1 Logistic objectives
Tbe quality of the logistic performance is determined by lead time and schedule
performance in the job shop as outlined in figure 1. On the other hand, loading of
the production facilities and work-in-process (WIP) influence the profitability of
the manufacturing process. From these partly conflicting requirements concerning
the production planning and control (PPC) the four main objectives of the
production process an be derived. Short lead time and low schedule deviation
Marke!
Objectives
Factory
Objectives
o IFA C084SE
Figure 1 Logistic objectives in manufacturing

Production planning and control on the basis 0/ control theory 353
represent the market-related objectives, whereas low inventory and high and steady
loading of the work systems are the /actory-related objectives.
In order to adjust the logistical objectives under the consideration of their mutual
dependencies and the aspect of competitive production, there exists the demand to
design a controHable production and order processing. While conventional PPC
systems predominantly control (open-Ioop) and therefore a feedback is missing, a
self-controlling process can be achieved by a closed-Ioop control by defining
appropriate reference and correcting variables.
2.2 The concept of a continuous production model
Present day PPC systems differentiate between the planning and the
implementation level. These views can also be applied to the production control.
Due to the different characters of the levels, different models are needed. Single
events are of interest on the implementation level. A more global view on the
planning level makes the utilisation of a continuous model possible. This is
desirable because the theory of control has a larger number of methods for
continuous processes available. In addition, the planning level is responsible for the
definition of the side constraints for auaining the goals on the operationallevel. The
planning level of the production control is therefore the essential object to be
viewed in the foHowing (Petermann, 1995).
Various models for production control have already been developed. Most of
them are based on a simple control loop. The feedback in today' s PPC systems can
be mentioned here as an example. The feedback is restricted to the closing of
information circuits. The actual reaction remains with the system user. Such
concepts are missing a clear definition of the control variables as weH as a
description of the relationship between effects. Thus the correcting variables can
not be derived effectively. The deterministic models underlying this system merely
describe reality statically and are not appropriate for depicting the dynamics of
reality. Most of the systems are laid out to enforce the plans generated and show a
strong static character because of this.
It is therefore necessary to develop a continuous production model that bases on
closed-Ioop control technology. A continuous model of a production system can be
developed with the aid of the funnel model and the logistic operating curve
(Petermann, 1995). The underlying funnel model, suitable on the implementation
level, depicts the individual events at a work system and represents a discrete
model. The substitution from discrete to continuous models is successful, when the
microscopical behaviour of the discrete individual process disappears behind the
macroscopical. This is to be assumed for controlling on the planning level, because
here the individual event is not of interest, but rather mean variables, like loading,
WIP or lead time observed over aperiod of time.
------------- --------------------- - - -. rneanworic

"""' ·1.
(I,..,ut r"")
I In ..
mHI1 I. .d time
I
I
I
I
i-·
I perfonnaneo
I
I
I
I
I
I
,I
I
I I
,,
I
I
I
I
: tIow-out
mAn ordef time I I (cMpvt noto)
I I
1_------------------------------ ____ --_1

I I
dlscrete tunnel model 01 contlnuous model of

a work system a work system
OIFA DI654e
Figure 2 Comparison of the input and output variables of discrete and continuous
models
The input and output variables as weIl as a simple control loop of the continuous
model are pictured in figure 2 on the right side. The incoming orders, measured in
hours of work content in the funnel model, are converted to the input rate (dimen-
sion: orders per unit of time). Analogue to this, the same procedure is followed on
the output side for the outgoing orders, which are then represented by the output
rate. The various sizes of the orders, demonstrated as different sized balls in the
funnel on the left side, are considered in the continuous model through the mean
weighted operation time as a parameter of the order structure.
The other variables are comparable with the discrete model but are calculated as
mean values. Inside the continuous model a simple control loop is depicted. With
the aid of a time integral the input rate of the system is transformed into the input
(IN). Analogue to this, the same procedure is followed for the output (OUT). The
mean WIP (MWIP) is calculated as the difference between the input and output
(summation point). The mean weighted lead time results from dividing the mean
WIP by the output rate (funnel formula) (Wiendahl, 1995). The four variables mean
performance. output rate, mean weighted lead time and mean WIP are the output
variables of the system. The logistic operating curve forms the connection between
the mean WIP, the mean weighted lead time and the mean performance with the aid
of the capacity and the ideal minimal WIP (order structure) as input parameters
(figure 3). Using the normalised version it describes the interdependence between
utilisation (UT) and relative mean work in process (MWIPre') which is the relation
between mean WIP (MWIP) and minimum mean WIP (MWIPmin ) (Nyhuis, 1994).
Production planning and control on the basis of control theory 355
Output
~ Q)
E.E
-1=
5.-0
'5!
o ...J hl~...",~~:::::=-.
! ·_·_·_·_·_·_·-r·_·_· Ideal Minimum Practical Minimum
1 I 01 Lead Time of Lead Time
meanWIP [h)
Idealmean
WIP Minimum MWIP"*'
Practical mean WIP Minimum SCO: Shop Calender Oays
OIFAD417'21!!
Figure 3 Interdependency between output, lead time and work-in-process (WIP)

(Nyhuis, 1994)
The operating curve states that the production of a work system is independent of
the WIP as long as every work system has a store of pending orders at all times.
Then the output of the system is almost equal to its capacity. Only if the inventory
is further reduced losses in production will occur due to interruptions in the
material flow. On the other hand, the lead time decreases in proportion with the
WIP until the bending point is reached. Beyond this point the lead time cannot be
reduced further, because it is limited by the sum of the operation and minimum
transportation time (idealised minimum of lead time). The idealised mean WIP
minimum (MWIPmin) represents the WIP level that is necessary to run the system
under idealised conditions, assuming that no arriving order has to wait. This
cannot be found in practice, so the realistic curves differ from the idealised ones
shown in figure 3, even though it is possible to calculate these realistic curves for
most of the job shop production (Nyhuis, 1994). Therefore the operating curve is an
excellent solution to constitute the transmission function of the continuous model.
2.3 Model evaluation
The transition from a discrete process to a continuous process is difficult. Is this

transition fundamentally allowed? When does the microscopic behaviour of the
single event (here: the processing of a operation) stand behind the macroscopic
behaviour of the system with reference to the viewed input and output variables?
To be able to answer these questions, extensive model evaluations have been
necessary.
For the discrete simulations performed within the scope of the model evaluation,
the event-controlled production simulator PROSIM II, which was developed at the
Institute for Production Systems (IFA), was used. The comparison simulation for
the continuous model was performed with the aid of the MATRIXx simulation, a
special simulation software for the support of cybernetic systems. The ability to
transfer the discrete model to the continuous model was verified based on numerous
test runs (Petermann, 1995).
3. CONTROLLER DESIGN
3.1 Definition of reference and control variables
The design of a controller concept has to be divided into two different steps. First of
all, it is necessary to define the controllable output variables under consideration of
the input variables. Afterwards, the linkage of the controller has to be designed.
With the aid of the models presented two controllers for a work system were able to
be modelIed. The input and output variables of the continuous model have been
discussed in section 2.2. The variables output performance, WIP and lead time, are
linked through the funnel formula. Therefore only two of the variables are
controllable at one time.
The essential task of a work system is to allocate the required performance to
process the system load (production schedule). For this reason the output
performance, respectively, the output rate attains importance. When viewing the
system's output performance, the actual output rate is of less importance. The
question of interest is whether the planned work is finished by a certain date. The
difference between the planned sum and the actual output is defined as the backlog
of the system. The backlog of the system thus becomes the most important control
variable for monitoring the output performance of the production system. In order
to utilise a clear definition, the newly developed controller is therefore named
backlog controller instead of output controller. The capacity is used here as a
correcting variable of the system. Fig. 4 shows the concept of a backlog controller.
r-!L- a~ ~
Backlog- + PERP!..n
~
Controller
CAP :CapacIty
PEfüd : ActuaI Performance
PER_: Planned Perfolmance
Production- PERAct BL : BacIdog
I..-,.
system BI.o : BacIdog BI Plannlng llme
CAP
OFA C1114E
Figure 4 Concept of an automatie baeklog controller

Production planning and control on the basis 0/ control theory 357
WIP- .ÄMWIP ,...-IMWIPPIan

MWIPPIan: Planned WIP
controller - MWIPAd : Aclual WIP
AMWiP : WIP-Deviation
INR : Input Rate
•
INR Production- MWIP~
system
OlFAC1715e
Figure 5 Concept of an automatic WIP controller
The planned performance is the reference variable. The difference between the
actual and the planned performance is integrated. The result is the above mentioned
backlog. Referring to the actual backlog the following backlog controller adjusts
the required capacity of the work system. Because in reality it is impossible to
adjust the capacity immediately, a dead time between the request for capacity and
the following allocation was introduced (petermann, 1995).
After defining the backlog as a control variable, adecision whether the lead time
or the WIP shall be controlled is necessary. A controllable order processing based
on production scheduling supports the implementation of the lead time as control
variable. But two basic problems derive from an implementation of the lead time:
firstly, the measurement of the variable is difficult; secondly, the value of the lead
time is limited at the lower end. This is problematical if the reference value of the
lead time falls short of this limit. The mean WIP as control variable is not limited.
Moreover its measurement is easier and more precise. Therefore it is obvious to use
WIP control.
The main task of the WIP controller (figure 5) is to set the system to an operating
point on the logistic operating curve that was defined within the scope of the
production planning. The planned WIP is the reference variable. Referring to the
difference between planned and actual WIP the WIP controller adjusts the input
rate of the production system (Petermann, 1995).
3.2. Combination of the backlog and WIP controller
The calculation of the required capacity for the next period depends on the
operating point on the logistic operating curve of the work system. The developed
concept for the backlog controller can only catch when the planned utilisation of
the system is reached since otherwise backlog does not arise. The WIP controller is
suitable for this task. The principle working method of both controllers can be
compared with the conventional production control methods. In the case of
increasing backlog in a production system, it is useful to increase the capacity. If
PERplan
"tr ~
backlog BL äPER +
controller I-
BL.o -
MWIP",',pIan
L~
MWIPpian
WIP äMWIP +
controller -
MWIPact
~ work
INR PERact
system
MWIPmln
CAP : capacity MWlPreI,pIIn maan relative planned WIP

UTplan : mean planned utilisation PER... maan actual performance
MWIP : maan WIP PER".... maan planned performance
MWIP,,*, : minimum maan WIP INR input rate
BL : backlog BLD backIog at planning tima
o IFA CDfD6Ef
Figure 6 Concept of a combined WIP and backlog controller
the throughput time keeps growing, the line-up (queue) in front of the work system
can be diminished through reducing the input rate of the system. The operating
characteristic curve is a qualified tool for combining both concepts with each other.
Simulation experiments have confirmed that this approach guarantees the synchro-
nisation of capacity and work. Figure 6 shows the integration of both controllers in
a controller concept.
The first step is to decide on which operating point on the characteristic curve the
system should be driven. This can be done by deciding which utilisation the system
ought to reach. For important or expensive systems this value must be higher than
for the other systems. So the backlog control loop is enhanced by calculating the
planned output first and then using the planned utilisation for determining the
necessary capacity . The relative WIP is multiplied by the actual minimum mean
WIP (MWIPmin). This results in the planned mean WIP.
Deviations between the planned and realised performance of the system are
integrated over time and defined as the backlog of the system. The backlog
controller calculates the planned performance for the next period which is divided
by the planned utilisation. The result represents the corrected capacity of the
Production planning and control on the basis of control theory 359
system. The planned relative mean WIP is multiplied by the actual minimum mean
WIP. This delivers the planned mean WIP as the reference value of the WIP
controller for the next period. This value is compared with the actual mean WIP in
the system and by deviations the WIP controller corrects the input rate.
The whole concept and the control design were created by using control theory
methods and simulations. Furthermore simulations were used to evaluate the
control design. Those simulation experiments testify that the described strategy
fulfils the requirements that were postulated in the beginning with a high grade:
Material (work) and capacity always come together at the same time.
The market often requires short term changes for orders to be carried out without
being planned in the production program. This leads to more or less orders which
must be executed unplanned but with high priority. In the upper part Figure 7
illustrates the effect of such an urgent order on a balanced system without control,
in the lower part, with the described control system installed. The unplanned order
with a work content of 10 h arrives on SCD 26. As it is called an urgent order it is
processed immediately after its arrival. Due to this, WIP rises by 10 h to 17 hand
backlog comes up because planned work cannot be carried out. Because of its low
time constant the system is able to reduce both backlog and WIP to the initial level
relatively fast (34 SCD).
Unplanned Urgent Order 10 h
~ 18
11
20
16
! -MeanWIP[h)
...... Capacily [hISCD)
---- BacIdog [h)
~ 14
0.. 12
!
S 10
.',
8 ... ....... ···f·· ..·, .. ···a ........................... . _..................... .
! ...... . .
~
6
4
". ......... .
......
2 ./
o~--~---+--~----+---~---+~~=-~
........ --- ..
20 25 30 35 40 45 50 55 60
uncontrolled llme[SCD)
Unplanned Urgent Order 10 h

20
~ 18
1; 16
~
m 14
i
0.. 12
10
o 8 .............. ':.~ ~::.~:.~~'" .... 1. .. _................................... _......... .
6 !
,
\
4 ! \
2
./
O~--~---+--~~--+---~---+--~ ' '. __~
20 25 30 35 40 45 50 55 60
controlled llma[SCD)
OIFA C3030E
Figure 7 Impact of an unplanned urgent order on the control parameters

The controlled system reacts completely different. As the first measure the WIP
controller reduces the input rate to decrease WIP to the planned level. The backlog
controller works periodically every 5 days and corrects the capacity after 2 days
dead time at SCD 32 exactly to that value that is necessary to decrease the backlog
to zero during the following period. At the same time the WIP controller increases
the input rate so there is enough work in the system.
This demonstrates that work that cannot be performed is not released until there is
sufficient capacity available to carry it out. Capacity and work come together at the
same time keeping throughput times at the planned level and compensating
disturbances between load and capacity. The quality of this process in a system
with this control strategy installed is independent from the initial operating state of
the production system. The uncontrolled system behaviour though becomes worse
with higher utilisation as previously mentioned.
4 INTEGRATION OF THE DEVELOPED CONTROLLERS IN A PPC

ENVIRONMENT
PPC systems of tomorrow will certainly not be based on integrated circuits. From
today' s view, three areas can be identified in which changes in PPC could arise
from the previously mentioned approach.
To begin with, it is to be expected that new elements enlarge the understanding of
the process and its mIes of behaviour, as was shown in the example above. Beyond
this, it is quite imaginable that improved techniques and algorithms for the planning
and enforcing of order processing can be developed on the basis of these models. It
can be determined quite definitely, that a rethinking of the function architecture in
PPC is necessary if a controlled process is to be attained. The following are new
characteristics of a process govemed by controlling: (1) short-term realisation of
changing goals with respect to time and locality (guidance behaviour), (2)
compensation of occurring disturbances (disturbance sensitivity) and (3) quickest
possible attainment of astate of balance (stability).
A proposal for such a functional concept is shown in figure 8. The levels,
planning and operation, are kept in the usual form. Main tasks are named within
the levels with respect to production control. Three cross-section functions are
mentioned alongside. The entire architecture must demonstrate a continual
transparency between the control variables and the parameters used in the
functions. This can be realised most consistently when all implemented procedures
are based as much as possible on the same models.
The WIP controller affects the input side through the order release; the backlog
controller has to guarantee the capacity. The higher the capacity flexibility of a
production is, the more the output performance control stands out over the WIP
control. Capacity flexibility can be described on the whole by the length of time, in
which a change of capacity can be realised and by the limits within which this
Production planning and control on the basis oj control theory 361
DG*
rt
-
oonftguratfon
~
I .....
,
...:.1 order generating
~I
) I l
i f I
i
~I
I I
schedullng
~ I t II
Ii!
1Ft bacIdog controI I;:

I
u
fi wlpcontrol ~
I
1 L.:::::1 straIghtline I
I
T
...... dIIa
o FA 01S48E Ir
Figure 8 Functional architecture of an automatie production control system
change can range. The scheduling and gene rating 0/ orders are to be understood as
correcting variables. The order generation results in the corresponding order
structure which most likely arises in the work system. The scheduling sets up a
dynamic loading plan for the work system and determines beyond this, the planned
start dates.
The configuration represents a function, which is largely unknown in the classical
field of PPC. Its task is to secure the commitment of consistent and also reachable
goals. On top of this, it represents the connecting link between goals and process
parameters which brings about the transparency demanded above.
At the latest in the configuration the total system does not work automatically, but
rather with a strong binding to the human being. Other important cross-section
functions are the model adaptation and the parameter evaluation. The latter has the
task of monitoring the parameter adjustments while in operation and if necessary,
pointing out inconsistencies that arise. These inconsistencies can arise from
disturbances or from the process itself. The model adaptation has to guaranty a
continual and highest possible automated adaptation of the models used, because
even controlling can not function when the underlying control path model does not
comply with reality anymore. All three cross-section functions work closely
together and can mutually support each other (petermann, 1995).
5 SUMMARY
A production process control approach contributes to the development of new

algorithms and therefore, ultimately also to the development of new function
architectures for PPC. With that, the possibility of a self-controlling, dynamic
process, which can respond quickly to changing environmental conditions, is given.
The validity of the continuous model as well as the controller concept was
evaluated for a single work system (a single machine, a machine group, a cost
centre or an entire factory). The model itself is already suitable for the connection
of several work systems by the material flow. The extension of the controller
concept to describe the interaction of different work systems is subject to further
studies at the Institute for Production Systems.
6 REFERENCES
Nyhuis, P. (1994). 'Logistic operating curves - a comprehensive method of rating

logistic potentials'. Paper at the conference "EURO xn fOR 36", University of
Strathclyde, Glasgow, United Kingdom.
Rommel, G. 1993). 'Einfach überlegen'. Schäffer Poeschel Verlag Stuttgart.
Petermann, D. (1995). Modelbasierte Produktionsregelung, Fortschrittsberichte,
Reihe 20, Nr. 193, VDI, Düsseldorf
Wiendahl, H.-P. (1991). Modellbasiertes Planen und Steuern reaktionsschneller
Produktionssysteme, GtMT, München.
Wiendahl, H.-P. (1995). Load-orientated manufacturing contro~ Springer, Berlin.
7 BIOGRAPHY
Hans-Peter Wiendahl graduated from the University of Aachen as a Diplom-

Engineer. 1967-1970 he was research assistant at the Laboratory for Machine Tools
and Workshop Management, before graduating as Dr.-Ing.. 1972-74 he was
employed at a big industrial fIrm and stayed there as head of the technical
department, Paper Machine Branch, until1979 when he was appointed as full time
professor and director of the Institute of Production Systems (IFA), University of
Hanover. He is referee for various research associations and a full member of CIRP
since 1989. In 1997 he became chairman of the German Society of Production
engineering.
Jan-Wilhelm Breithaupt graduated 1994 from the University of Hanover. In 1995

he was Trainee at one of the leading industrial groups in Germany . Since 1996 he is
research assistant at the Institute of Production Systems (IFA) at the University of
Hanover. His fIeld of research is production control.
32
Integrated production management for
production planning, loading and
scheduling
Fuminori Oba, Takeshi Murayama and Dianying Ma

Faculty 0/ Engineering, Hiroshima University
Kagamiyama 1-4-1, Higashi-Hiroshima, Hiroshima, 739, Japan
Tel: +81-824-24-7550 Fax: +81-824-22-7193
oba@mec.hiroshima-u.ac.jp
Abstract
Tbis paper deals witb a production planning system wbicb is integrated witb
loading and scbeduling in tbe job-sbop type production circumstances. Tbe
production planning system is based on an MRP explosion system in wbicb tbe
leadtime of eacb part is given based on tbe processing time of tbe part in eacb
work-center and tbe time-bucket size is adjusted by using tbe feedback information
of tbe production load out of tbe loading system. In tbe loading system, tbe loading
and tbe balancing activities are carried out for eacb work-center, and tbe time
bucket is given by subdividing tbe one in production planning and adjusted by tbe
result of scbeduling. A numerical example is presented to ilIustrate tbe procedure
of tbe proposed system.
Keywords
Production planning, loading, scbeduling, integrated production control
1 INTRODUCTION
In tbe low volume, bigb variety production and fluctuating production

environment, decision-making in tbe production management is complicated and

much affects to production leadtime and costs. In such environment, the original
MRP(Material Requirement Planning) system and even the MRP
II(Manufacturing Resouree Planning) system cause the following problems:
• Any explicit procedure is not presented to balance the workload and capacity at
the loading and shop-floor controllevel.
• It is difficult to integrate production planning with loading and scheduling,
because the MRP systems manage these planning problems with an identical
bucket's span of time, though the appropriate time spans differ with the
different levels in decision-making.
• Using a pre-determined leadtime for each part in the time-phased explosion
process of the MRP often results in the overdue production or too much
production period of time, because the leadtimes for all the parts vary with the
production workIoad and the facility capacity available in the shop-floor and are
to be first available after scheduling.
To cope with these problems, non-standard approaches to MRP 11 in which
scheduling to finite capacity is included are presented in recent years( Scott, 1994).
Matoba et al.(1993) proposed a dynamic MRP in which production planning is
integrated with scheduling for a flow-shop type production system. These
approach es contain the large feedback loops in which the results of scheduling are
utilized for production planning. It is however very hard to apply these approaches
to the job-shop type or cell-type production systems, because decision-making with
such feedback loops is too complicated in the low volume, high variety production
environment.
In this study, a new procedure is proposed to integrate production planning with
loading and scheduling, which has basically the same architecture as the non-
standard MRP 11 systems, but is not so tightly hound by the feedback loops. This
approach may lead not only to simple decision-making in the integrated
production management, but also to the shorter Ieadtimes for whole production as
weil as to the elimination of the overdue productions. The production environment
treated here is assumed that the low volume and many kinds of products are
simultaneously produeed through several job-shop type work-eenters for
machining and assembly, each of which comprises several machines.
2 PRODUCTION PLANNING MODULE
An architecture of the integrated production management proposed here is as

shown in Figure 1, where the hold lines indicate the main routes of information for
decision-making and the fine lines are feedback information which is given only if
necessary.
Primary objectives of production planning are to determine the production
periods of time and quantities for all products and component parts, according to
the time-phased parts explosion technique in MRP using the bills of materials, and
Integrated production managementfor planning, loading and scheduling 365
balancing tbe production workload in eacb work-center witb tbe production

capacity available in every period. Tbe proposed system is tberefore tbe decision-
making tool, wbereas tbe typical MRP 11 is essentially tbe decision support tool
wbicb gives tbe planner information on workload and capacity, and no
information of bow to balance tbem.
i nfonnat ion
Scbeduling Loading
Planning result infonnation
Figure 1 Arcbitecture of integrated production management.
2.1 MRP parts explosion process
Tbe span of time bucket adopted as tbe unit of time in MRP is determined by tbe
planner taking account of tbe manufacturing environment and tbe firmness of
demand over tbe future borizon, for example, a montb, a week or a day. In tbe
MRP 11 standard systems, once a time span is selected, tbe span is identically used
in tbe loading and scbeduling levels as weIl as tbe production planning level, in
spite of tbat tbe appropriate spans may be different witb tbe levels in tbe
bierarcbical structure of decision-making. Tbis may cause tbe problem to make it
difficult to integrate production planning witb loading and scbeduling. To cope
witb tbis problem, we appropriately adopt tbe different span of time bucket for
loading and scbeduling from production planning.
In tbe production planning level, tbe larger bucket-size associated witb tbe large
number of levels in tbe product structure trees results in tbe Ion ger leadtime. On
tbe otber band, tbe smaller bucket-size leads to frequent rescbeduling to ensure the
accuracy of tbe production scbedule. In tbis study, a week is initially adopted as tbe
span of time bucket in tbe production planning level, wbicb may be adjusted later
by using tbe feedback information of tbe production workload out of tbe loading
system if necessary.
Next we consider tbe planning leadtime to be used for tbe time-pbased parts
explosion in MRP. In MRP standard systems, tbe planning leadtimes are tbe user-
defined parameters wbicb are fixed, regardless of batcb size. Manufacturing
leadtimes in practice vary according to tbe status of workload and capacity
available in the shop-floor. This causes the gap between the planned schedule and
the real results in the shop-floor.
However, the actual leadtime for every item can not be found until detailed
scheduling is performed. This results in the recurrent processes with large
feedback loops as shown in Figure 1.
To resolve this problem, the manufacturing leadtime for each part is estimated
as folIows. First, the total processing time 1';i per batch of part Pi in a work-center
Wj is calculated as
(1)
where, ni is the batch quantity of part Pi and tpii is the processing time per unit of
the part which is performed through several machines in the work-center. Then,
the manufacturing leadtime ofthe part, L1';, may be given by Eq. (2),
L1'; = TB' NB [max T;j] [min.]

(2)
J
where TB is the span of time bucket, max Iij. is the maximum total processing
time over the work-centers through which the part Pi is performed, and
NB[X]means the minimum number of time buckets which includes the time
lengthX.
Executing the time-phased parts explosion in MRP using the manufacturing
leadtime obtained above, the production period to produce each part or product can
be determined. Using the result' the load rate fijk of each part Pi in each work-
center Wj for each production period (bucket) Bk can be calculated by
(3)
where PTijk is the total processing time per batch of the part Pi loaded in work-
center Wj during bucket Bk, and TR jk is the available running time ofwork-center
Wi during Bk. Thus, the load rate of work-center Wi in bucket Bk is given by the
sum of the load rates fijk over all the parts loaded:
(4)
2.2 Smoothing of overloads
If any work-center is in the overload situation in any time period, some workloads
should be moved into an alternative time period where capacity is available. To
establish the procedure for smoothing of overloads, the loading states of the work-
lntegrated production management for planning, loading and scheduling 367
centers are classified into tbe following tbree groups, according to tbe load rate 1"jk
given by Eq. (4).
Group 1: 1"jk>a1: overload state

Group 2: al~lj'k~a2: adequate load state (5)
Group 3: 'ik<a2: extreme underload state
wbere al and a2 are upper and lower tbresbolds respectively, to distinguisb tbe
load states. Here, it sbould be noted tbat tbe load rates lj'k are not necessarily exact,
because tbey are not derived from detailed scbeduling. Tberefore, tbe value of al
may not be 100%, but some sm aller value, for example, 65%. In order to eliminate
tbe feedback loop in Figure 1, tbe al sbould be determined as exactly as possible.
Tbese values are possibly varying depending on tbe manufacturing environment,
and can be refined by experience or by feedback information from tbe scbeduling
module.
Tbe cbange of time period to produce some part results in extension of leadtime
for tbe part, and consequently, leadtime for tbe end product including tbe part as
tbe component. It is tberefore needed to know earliness of tbe end product, in order
to see possibility of tbe cbange of production period for tbe part. Here, earliness of
tbe product is given as folIows,
Ei =Di - CMLTi (6)
wbere D i is tbe time period from tbe present date to tbe due date of tbe end product
Pi, and tbe CMLTi is tbe cumulative manufacturing leadtime oftbe end product Pi
wbicb is defined as tbe Ion gest leadtime from top to bottom of tbe product structure
tree.
Tbe parts allotted to be produced in eacb time period are classified into
following tbree groups, according to earliness of tbe products including tbe parts
as tbeir components.
Group A: Ei =0: zero earliness

Group B: Ei ~ ß . Di : adequate earliness (7)
Group C: Ei> ß . ~ : too mucb earliness
wbere ß is tbe user-defined parameter like a1 and ro.

As a resuh, tbe parts to be loaded in eacb work-center in eacb time period are
classified into 9 groups sbown in Figure 2, based on tbe combination of tbree
groups regarding tbe loading states of tbe work-center in Eq. (5) and tbree groups
regarding earliness of tbe product in Eq. (7).
~
GroupA GroupB GroupC
Load State Zero Adequate Too much
Group 1 A-1
Overload B-1 C-1
Group2
A-2 B-2 C-2
Adequate
Group3
Underload A-3 B-3 C-3
Figure 2 Part group based on loading states and earlinesses.
The smoothing procedure of overloads in the production planning level IS

proposed based on these groups of parts as folIows.
Step 1 : If any work-center is in the overload situation (Group 1) at any time
period, it is first tried to move some parts in the C-1 situation into the
immediately preceding period. In this case, the leadtime for the parts
transferred will be extended, and therefore earliness of the relevant end product
will be affected as well as the workload of the work-center with additional load
at the preceding period. Thus, the change in the situation at the preceding
period is examined, which may be caused by moving the loads. Then the
transfers of the parts into the preceding period are tried in order of the situation
C-3, C-2, B-3 and B-2 at the preceding period, until the overload situation at
the current period will be resolved. In the case that the part to be moved has its
child parts in the product structure, the child parts will be transferred backward
by the time-phased parts explosion. As a result, if any overload situation is not
caused in any time period, these transfers are adopted.
Step 2: If the overload situation at the time period under considerations can not be
resolved by the procedure in Step 1, next consider the transfer of the parts in the
B-1 situation into the preceding period. This transfer is tried in order of the
situation B-3, B-2, A-3, and A-2 to be caused at the preceding period. These
transfers tan be adopted if any overload situation will not be caused at any time
period by the subsequent transfers of the child parts.
Step 3: If any overload situation is caused at any time period by the transfers ofthe
child parts in Step 1 or Step 2, the procedure of Step 1 or Step 2 is executed at
the time period in which the overload has occurred.
Step 4: When the overload situation can not still be resolved through above steps,
consider the case that the overload situation C-1 or B-1 will be caused at the
preceding period by the transfer of the part in overload situation C-1 or B-1 at
the current period into the preceding period. In these cases, the procedure from
Step 1 to Step 3 will be executed for the preceding period.
Step 5: In the case that all of the above Steps end in failure, the overload situation
is necessarily caused at some period. In this case, the transfer is adopted which
Integrated production management for planning, loading and scheduling 369
causes tbe minimum overload, and tbe capacity is tben adjusted to fit tbe load at
tbe period wbere tbe overload exists.
3 LOADING MODULE
In tbe production planning level, tbe workload was allotted to eacb time bucket.
Tbe parts allotted to eacb bucket may practically be worked tbrough more tban one
work-station according to tbeir process routings.
It is tberefore necessary to decide in wbicb time period witbin tbe bucket and in
wbicb work-center eacb part sbould be loaded, so as to balance workload and
capacity in any time period witbin tbe bucket and in any work-center.
For tbat purpose, tbe time bucket in tbe production planning level is subdivided
into sub-buckets, tbe number of wbicb is tbe maximum number of work-centers in
wbicb tbe parts are loaded witbin tbe time bucket, as sbown in Figure 3. Tbe sub-
bucket is used as tbe unit of time in tbe loading in eacb work-center. Tbe sub-
bucket is also used to make tbe detailed production scbedule for tbe parts loaded in
eacb work-center witbin tbe sub-bucket. Tbus tbe loading module can be
integrated witb tbe scbeduling module.
Time-bucket
1 3
time
2 I 7 I>
time
Figure 3 Time management in production planning and loading stages.
In order to make tbe feasible loading plan into eacb work-center in eacb sub-
bucket, tbe load rate of tbe work-center in tbe sub-bucket is calculated. However
tbe actualload rate can not be determined until tbe detailed production scbedule in
tbe work-center witbin tbe sub-bucket is given. Here, tbe load rate is tberefore
tentativelyestimated regardless of tbe waiting time. Tbus tbe load rate per batcb of
tbe part is given as folIows.
(8)
wbere LR ijk is tbe load rate per batcb of part Pi in tbe work-center Wj witbin tbe
sub-bucket SB k, Lijk is tbe total sum of tbe standard processing times on macbines
included in tbe work-center Wj per unit of part Pi loaded in tbe sub-bucket SB k, ni
is the batch quantity of part Pi, and Cjle is the sum of the available running times of
a11 the machines inc1uded in the work-center Wj within the sub-bucket SBk.
Loading and smoothing of the workload into work-centers are pedormed
according to fo11owing steps.
Step 1 ( loading ) : The parts a110tted into a time bucket in the production planning
module are loaded forward from the first sub-bucket within the time bucket into
the required work-centers according to the production routing of each part.
Step 2 (smoothing of overloads ) : If any work-center is in the overload situation at
any sub-bucket, the part which is manufactured througb the work-centers less
than the number of sub-buckets within the time bucket is selected as a candidate
to be moved to later sub-bucket. In the case there are more than one part in such
situation, the part to be moved is selected in increasing order of the number of
work-centers to be successively loaded. Wben the overload situation can be
resolved in a11 sub-buckets, it is possible to proceed to the next step. On the
other hand, if the resolution of overload situation is not possible in this way,
information on the load rate in the overload situation will be fed back to the
production planning module in order to change the time bucket for the overload
work. In this step, the overload situation can be recognized by the fo11owing
equation using the load rate given by Eq. (8).
LR jk = l,LRijk > Yl (9)

i
where I is the sum of load rates of parts to be loaded into the work-center Wj
in sub-bucket SBk and yl is the user-defined parameter to distinguish the load
states. Here, Y1 may not be 100%, but some sma11er value, because the load
rates LR ijk were estimated without regard to queue time. The value of Y 1 can be
refined by experience or feedback information out of detailed scheduling.
Step 3 (smoothing of work loads) : If imbalance exists between work-centers in
each sub-bucket, the smoothing procedure is carried out in such a way as Step 2.
If these steps result in the extreme underload situation given by the load rate LR jk
<Y2 in every sub-bucket, the span of sub-buckets should be shortened so as to be
appropriate-Ioad situation, Yl > LRjk >Y2. At> a result, the span of time bucket in
the production planning level can be shortened as we11, which makes it possible to
shorten the production lead time of products.
4 SCHEDULING MODULE
In order to pedorm the production ofthe parts loaded to the work-center within the
sub-bucket along the loading schedule and to realize leadtimes as shorter as
possible, the appropriate schedule should be made so as to minimize the queue
time, whose method may be found in many studies like Oba et a1.(1993).
lntegrated production management for planning, loading and scheduling 371
If it is found that the production of parts loaded can not be completed within the
sub-bucket in this stage, the information of load rates is fed back to the loading
module and rearrangement of the loads is carried out using the actual load rates
based on detailed scheduling. The feedback information of actualload rates may be
utilized to refine the threshold value of r1 in the loading level as weil as al in the
production planning level.
5 NUMERICAL EXAMPLE
The six kinds of end products X, Y,Z,H,J,T are produced in the example. The
detaiIed bills of materials are not described here owing to limited space, but each
product structure comprises some of six kinds of subassemblies(A,B,C,D,L,K,S)
and twelve kinds of parts(d,p,f,v,u,e,m,g,n,o,r,q) as shown in Figure 4 as a couple
of examples. In Figure 4, an alphabet shows apart, a subassembly or a product and
a numeral attached to the alphabet is the number of the part required to produce a
unit of its parent. In the production system, there are three work-centers WC#l,
WC#2 and WC#3 for assembly, and three work-centers WC#4, WC#S and WC#6
for machining, each of which comprises four machines. Each part is finished
through two or three work-centers in which the processes between three and six are
performed. The standard processing time of each process is distributed between 2
and 28 minutes.
Figure S shows the result of the time-phased parts explosion in MRP based on
the master production schedules(MPS) for the products X, Y,Z,H,J,T and their bills
of materials. In this figure, an alphabet shows apart, a subassembly or a product
and a numeral attached to the alphabet is the required volume. The span of time
bucket is a week( 2880 minutes ).
x Y
I
~ I I I
~d2 v2 u2 e2...E,
p2 12 ml gl
Figure 4 Example ofproduct structure trees ofproducts X and Y.
Timebud<Et
1 2 3 4 5
X10 XIO
A10 AlO
D20 020
f20 f?O
d?O
d20
7.10 ZIO
C10 !10
n30 n,>O
020 n?n
f?n f20
HlO HlO
K10 K10
010 n1n
020 020
riO riO
p10 p10
J10 110 J10
L 10 L10 1 10
d20 d20 d?n
.10 ' in .1n
n10 n10 D10
m20 m20 m20
030 030 030
V10 Y10
v20 .?n
u20 u20
.. 'XI .. 'XI
B10 R1n
m10 m10
010 010
Tin
S10
f?n
nAA
"in
Figure 5 Time-phased parts explosion in MRP.
This result may be accepted because there is no overload 'situation in any work-
center in any time bucket. We can then directly proceed to the stage of loading.
Figure 6(a) shows the result of loading in which the workload is allotted to each
work-center in each sub-bucket of time. This figure gives the load rates in
percentage. In this figure, some overload situations are found in the hatched sub-
buckets in each work-center. Here, the threshold to identify the overload status al
is put at 65 percent. These overload situation can be resolved according to the
smoothing procedure in the loading module and the result is shown in Figure 6(b)
in which the shadowed numerals show the load rates changed with the workloads
transfer from or to another sub-bucket.
Integrated production management/or planning, loading and scheduling 373
buckd I 2 3 4 5
. ub-bud<et I 2 3 4 5 6 7 98 10 11 12 13 14
# 1 13 18 13 29 2622 31 45 26 19 9
#2 15 165M 6 25 11
9• 6 41 62 0 6 22
J;j
c
#3 9 54 13 t 6 1 38 9 52 38 22 10 9
#4 28 29 40 40 52 50 47 58 42 17 9 0
"u
-" #5 26 ~2J 0 58 45 8 59 li4l 5 10 14 0
~ #6 50 8 16 ~6] 48 12 117:1] 42 25 0 5 8
(a) bEfore smootbing
buckd I 2 3 4 5
sub-bud<et I 2 3 4 5 6 7 8 9 10 11 12 13 14
# 1 13 18 13 29 22 26 31 45 26 19 9
#2 15 28 25 ' 56 29 41 42 ':.20 6 22
lliL43
J;j #3 37 126 13 48 · 39 '· 26 52 38 22 10 9
c 40
" #4 28 29 52 . 30 60 47 ': 41 60 17 9 0
~0 #5 26 3li I:\~~ 45 ·.44 22 49 56 33 10 14 0
::: #6 ·51 21 . 52 51 '· 35 , 0 5 8
3~ >~~ 16 . 54
(bI aftEr smoolli ng
Figure 6 Load rate in each work-center.
mS gS d7 e2 dll g9
MS1
d8 m6 g8 e3 d12
MS2 I 1740
d6 e4 g6 d9 m8
M53 m
el g7 m7 dlO
MS4
960 1920 [min .]

Figure 7 ScheduIe in WC#5 in sub-bucket SB8 after smoothing.
Production scheduling in each work-center in each sub-bucket is carried out

based on the result of loading and smoothing in the loading module. As an
example, the detailed schedule in the work-center WC#5 in the sub-bucket SB8
after smoothing is shown in Figure 7. In this figure, the alphabets are parts which
are loaded to be machined in the work-center WC#5 in the sub-bucket SB8, and
the numerals attached to each part are the operation numbers according to whose
precedence relations the part is machined. Tbe precedence relations of operations
for each part are partially determined by process planning and the operations are
not necessarily processed in increasing order.
6 CONCLUSION
In tbis study, a new procedure for decision-making bas been proposed to integrate
production planning witb loading and scbeduling. Difficulties of tbis problem are
essentially caused by tbe strongiy connected relationsbip between production
planning, loading and scbeduling Iike tbat tbe results of decision made in tbe
lower level of scbeduling or loading are needed for tbe decision in bigher level of
production planning. Tbe strongest point of tbis study is tbat tbe arcbitecture of
decision-making bas been given to solve tbis difficult problem.
7 REFERENCES
Matoba, H., Obnari, H. and Enomoto, M. (1993), Production Planning System

using Dynamic MRP. in 'Proceeding of Production Scbeduling Symposium',
Tokyo, pp. 99-102. JSME (in Japanese).
Oba, F., Jigami, O. and Fusbimi, J. (1993), Loading and Scbeduling in
Consideration of Alternative Process Sequences. in 'Proceedings of
Production Scbeduling Symposium', Tokyo, pp. 141-145. JSME (in
Japanese).
Soott, B. (1994), Manufacturing Planning Systems, cbapter 22. McGraw-HiIl, UK.
8 BIOGRAPHY
Fuminori Oba is a professor at Hirosbima University since 1988. He received his

master degree from University of Osaka Prefecture in 1968, and bis doctor degree
from Osaka University in 1975. His current interests include design of
manufacturing systems, scbeduling, production management.
Takesbi Murayama is an associate professor at Hirosbima University since 1994.

He received bis master degree from University of Osaka Prefecture in 1986, and
bis doctor degree from Hirosbima University in 1993. His current interests include
CAD/CAM, ooncurrent engineering, assembly planning, and environmentally
oonscious design and manufacturing.
Dianying Ma is an engineer at IHI Packaged Boiler Fabricators Co., Ud. since

1997. Sbe received her master degree from Beijing University of Aeronautics and
Astronautics in 1982. Her current interests include scbeduling, process planning,
autonomous manufacturing systems, and petri nets.
33
Integrated planning and scheduling for
multi-product job-shop assembly based
on genetic algorithms
M F. Sebaaly and H. Fujimoto

Department ofMechanical Engineering, Nagoya Institute 01
Technology, Gokiso-cho, Showa-ku, Nagoya 466, JAPAN,
Tel: +81-52-735-5330 Fax: +81-52-735-5342
E-mail: milad@vier.mech.nitech.acJp
Abstract
This paper introduces a simultaneous approach for dealing with assembly sequence
planning and scheduling, which have been dealt with separately in research.
Assembly planning consists of finding the optimal or best sequence to assemble a
certain product, according to some product criteria. Assembly scheduling is
concerned with finding the optimal or best schedule to perform the assembly
operations by a given number of machines, according to some system criteria such
as time-in-process(TIP) and idle time. However, a best sequence necessarily leads to
an efficient operations schedule, and a best schedule might alter the feasibility
precedence constraints of the assembly sequence. These cases can be best
encountered in multi-product job-shop assembly. This paper introduces a genetic
algorithm approach to integrate the two procedures together. A prototype example is
solved to illustrate the new approach.
Keywords
Flexible assembly, planning and scheduling, genetic algorithms, concurrent
engineering.

1 INTRODUCTION
This paper addresses a multi-product flexible assembly problem in a job-shop

environment. The considered flexible assembly system (FAS) consists of a number
of flexible assembly cells or machines, each having the capabilities of performing a
family of assembly jobs or operations. For every product at band, two questions need
to be answered in order to implement an optimal or best assembly process resulting
in competitive products. First, what is the best sequence to assemble the product part
according to various product criteria such as stability, manipulability, directionality
and cost (Pu,1992; Wolter, et al. , 1992). Second, what is the best scheduleassigning
appropriate jobs for each machine to assemble the product, according to several
scheduling criteria such as product time-in-process (TIP) and machine idle time
(Fujimoto, et al., 1994; Lucertini, et al., 1994). Until recently, these questions have
been dealt with separately in research, and classified as assembly planning and
scheduling. Apparently, this separation resulted in partial independent results that
are unaware of the mutual dependence and interaction. In assembly planning for
instance, the optimal or best sequences obtained to assemble a certain product do not
necessarily take into consideration the cascading of assembly operations and jobs
needed every time a part is assembled, and the effect of this cascading on the system
balance, the machines idle times and the product TIP. On the other band, the
optimal or best schedules obtained to assemble a certain product, with the best TIP,
idle times and/or other scheduling criteria, do not necessarily take into
consideration the product stability, manipulability, directionality, etc.
Consequently, an optimal parts sequence best satisfying the planning criteria might
lead to bottlenecks resulting in longer machine idle times and product waiting
times. Similarly, an optimal job schedule best satisfying the scheduling criteria
might result in difficult manipulability conditions, unstable or marginally stable
subassemblies, or even invalid assembly sequences. Both outputs result in assembly
process difficulties producing less competitive products. This problem is frequently
encountered in a multi-product job-shop environment.
This paper addresses the problem of integrated assembly planning and
scheduling. The objective of this work is to simultaneously generate the best
sequences to assemble a group of products and the best schedule of corresponding
jobs. The adopted methodology is rather an extension of the work in (Sebaaly and
Fujimoto, 1996) that deals with automatic assembly planning based on Genetic
Algorithms. A best assembly sequence is generated without searching the whole
solution space. Search decisions are made for the entire assembly sequence rather
than on a part-by-part basis. This paper extends this methodology in two
dimensions: Several products are considered at the same time, and both planning
and scheduling criteria are represented in the objective function. The considered
environment consists of a fixed number of flexible assembly cells connected to each
other by flexible handling machines or robots. The GA is applied to a population of
Integrated planning and scheduling for multi-product job-shop assemb/y 377
individuals representing both assembly sequences and schedules. The fitness

ftmction considered by the GA selection operator is a multiobjective ftmction
linearly combining the planning and scheduling criteria with random weights. The
proposed algorithm is applied to a prototype example, where its various steps are
illustrated.
2 ASSEMBLY SEQUENCE PLANNING
The assembly sequence planning (ASP) problem can be simply stated as how to find
an optimal or best sequence to assemble a given product, given its CAD design files.
Various optimisation criteria are considered, which are related to the internal
'dynamics of the assembly operations, such as parts manipulability, operations
directionality, and tools cost. Several planners were introduced in research to tackle
this problem, most of which share one or more of the following difficulties
(Pu,1992; Wolter, et al., 1992): a- searching the complete solution space (exact
solution). b- performing part-based decision procedures. Starting by a certain
product part, adecision should be made every time to choose which ofthe remaining
unassembled parts is to be assembled next.
These difficulties make the introduced planners highly sensitive to any increase
in the number of product parts. A new approach is introduced in (Sebaaly and
Fujimoto, 1996) that overcomes these difficulties by applying genetic algorithms. A
new mapping is introduced to transform any random sequence into a feasible one
satisfying the assembly rules and constraints, which are assumed available or can
easily be extracted from the product design CAD files. This mapping paves the way
to GA application to the assembly planning problem, thus overcoming many
disadvantages of the previous exact-solution part-based-decision algorithms. A
sequence population is chosen at random. The introduced mapping is applied to
transform it into a population of feasible sequences. The fitness ftmction of every
sequence in the feasible population is then calculated according to some assembly
evaluations and constraints in which several criteria such as manipulability,
directionality, stability and cost are embedded. After that, genetic operators are
applied and a new generation of random sequences is produced. This procedure is
repeated until a termination criterion is met. Although it overcomes the difficulties
of many existing algorithms, this approach still need to be extended in two
directions: 1- to become able to deal with more than one product at the same time. 2-
to take into consideration the effects of cascading the assembly operations of one or
more products on a set of machines. The following sections constitute one of the
earliest extensions in these directions. The input planning data used in this paper are
a set of assembly mIes and constraints, and a set of assembly evaluations and
constraints. The derivation of these sets from the product design CAD files is
beyond the scope of this paper.
3 ASSEMBLY VS. PROCESSING SCHEDULING
The simplest general statement of the scheduling problem, is how to find the
optimal or best schedule that assign a given set of jobs to a set of available machines
or servers, according to some queuing criteria, such as the dient or product time-
in-process andlor waiting time, machines or servers idle time, and system or line
balancing. This definition holds for several types of scheduling problems, such as
trafik lighting, social services centres, and more specifica11y in industrial processes.
Industrial processes however, are divided into two phases, parts processing and
assembly, each with different characteristics and constraints. Consequently, the
corresponding scheduling problems are of different natures.
In parts processing for instance, a limited number of jobs is to be performed in a
fixed order on a given material to fabricate a certain product part (Fujimoto, et al.,
1994). Moreover, jobs of a certain part have no order relations or constraints
whatsoever with the jobs of any other part. This part independence reduces the
complexity ofthe scheduling problem since only few job ordering constraints should
be satisfied, regardless of the number of parts to be manufactured.
In assembly processes on the other hand, one or more jobs should be performed
to assemble two parts or subassemblies together, but the order in which parts are
assembled is almost fixed (Lucertini, et al., 1994). Consequently, almost a11 jobs
required to assemble a certain product are somehow related with a large set of
ordering constraints. As a result, if a certain sequence order results in weak
scheduling performances such as bottlenecks or large idle or waiting times, any
changes proposed by the scheduling optimisation algorithm to overcome this
weakness might lead to unfeasible subassemblies. Such cases are largely
encountered in job-shop assemblyenvironments, where one machine performs more
than one job at different time intervals. The problem becomes even more difficult if
more than one product are to be assembled by the same machines.
Another point that makes the assembly scheduling problem much more
complicated than the manufacturing scheduling problem, is that the processing time
for the same assembly job might vary according to the job order in the assembly
sequence, while the manufacturing job processing time is always fixed.
Consequently, different assembly sequences not only have different planning
evaluations, but also different jobs processing times that leads to different
scheduling evaluations. As a result, the traditional way of dealing with assembly
planning and scheduling separately, by first generating the best plan or sequence,
and then find the corresponding best schedule might not lead to a good solution.
Instead, integrating both procedures would ensure the generation of the best
sequence/schedule combination, although it might not contain the best schedule
andlor the best sequence.
Integrated planning and scheduling jor multi-product job-shop assembly 379
Product 1 Product 2 Product 3

R11,R12,R13 R21,R22,R23,R24 R31,R32,R33
Representation:
R31,R23,R21,R 11,R 13,R22,R32,R24,R 12,R33
Figure 1: Individual Representation.
A rather important difference between assembly scheduling and parts processing

scheduling is that in the latter, the number and order of jobs needed to fabricate a
certain part are fixed, while in assembly, both the number and order of jobs needed
to connect a certain part differ from one sequence to another.
4 MULTI-PRODUCT JOB-SHOP ASSEMBLY
This section provides a basic description ofthe multi-productjob-shop assembly. In

job-shop environment, m jobs should be performed by n machines, where m>n.
Usually, one machine performs a family of similar jobs. It is more flexible than the
flow-shop environment, where only one job is allocated to each machine (m=n).
Assembly job-shop environments in particular are very complicated, due to the
complicated precedence relations between almost all jobs that are performed by
different machines. As a result, jobs to complete a certain connection cannot be
performed before the jobs of its preceding connection finish, even if the
corresponding machine is idle. The fact that all connections are ordered in a certain
manner increases the occurrence probability ofunappreciated behaviours. This fact
is even more severe in systems that assemble more than one product simultaneously.
In this paper, the multi-productjob-shop assembly environment is considered, with
the restriction that one machine can perform a family of operations, but each
operation can only be performed by one machine.
5 ASSEMBLY PLANNING AND SCHEDULING INTEGRATION
5.1 Sequence/Schedule Representation
The representation of individuals considered to undergo the genetic operations is a

sequence of all existing mIes of every product at hand, arranged in a random
sequence. For instance, for 3 products having 3,4 and 3 assembly mIes respectively,
the individual sequence representation consists of 10 mIes arranged in a certain
order as shown in figure 1. This representation contains both the assembly sequence
for each product, and the overall schedule for all the products. For example in
figure 1, product 1 is assembledin the order R11, R13 and R12.
380 Part Six Production Plallning
Random Seguence/Schedule Representation:

R11 ,R22, R23, R13, R21 ,R12, R24, R14, R25
Feasible Seguences:
R14,R11,R13,R12 and R25, R24, R22, R23, R21
Feasible Seguence/Schedule Representation:
R14,R25,R24,R11,R22,R13,R23,R12,R21
Figure 2: Repairing Sequence/Schedule Individuals.
However, R11 is performed after R31, R23 and R21. The schedule of these
connections depends on both the number of machines and the processing time of
each connection. The mIes in a random individual are ordered in a random manner
that might not respect the precedence constraints of every product. A random
unfeasible individual is transformed into a feasible individual by repairing the mIes
order of products with violated constraints.
5.2 Repairing Unfeasible Sequences
Sequence feasibility is decided by the assembly rules and precedence constraints.

Since the mIes sequence is chosen to be the individual representation, then the
assembly mIes are for sure satisfied. What remains is to satisfy the assembly
constraints. These constraints can be represented as precedence constraints between
two mIes. The precedence constraint R1 < R2 means that rule 1 should precede rule
2. It follows that if this constraint is violated in a certain sequence, i.e. R2 is
preceding R1, it can be repaired by moving R2 to the positionjust before R1 in the
sequence representation. This procedure is repeated for all violated constraints in a
certain product, until the sequence becomes feasible.
In the sequence/schedule representation, where more than one product are
represented, the mIes of each product are taken out of their positions, repaired
outside to represent a feasible sequence, and then returned to the same positions. For
example infigure 2, the random sequence ofProduct 1 R11 ,R13,R12,R14 repaired
to become R14,R11 ,R13, R12 and then returned back to the original positions as
follows: R 14 to position 1 in place of R 11, R 11 to position 4 in place of R 13, etc.
Product 2 is repaired and retumed back in a similar manner.
5.3 Multi-objective Fitness Function
The fitness function is considered to be the reciprocal of the overall evaluation

function. The overall evaluation function is composed of a linear combination of the
planning and scheduling evaluation functions with constant coefficients, formulated
asfollows:
SOVR = aSP + ßSTIP + rSIT (1)

lntegrated planning and scheduling for multi-product job-shop assembly 381
Parent 1: R11, R12, R21, R22, R23

1
Parent 2: R2 R23, R22, R 12, R 11
Crossover Sites
Child 1: R11, R23, R22, R21, R12
Child 2: R22, R12, R21, R23, R11
Figure 3: Crossover Example
where SOVR : is the overall evaluation.

SP : is the total planning evaluation.
&TIP : is the time-in-process evaluation.
&Ir : is the idle time evaluation.
a, ß and rare constant coefficients.
5.4 Genetic Operators
Reproduction
The reproduction operator is applied to a population of chromosomes (Goldberg,
1989). Every chromosome should be a feasible sequence in the assembly case, in
order to be evaluated. It is represented by the sequence/schedule representation,
showing the rules sequences of the products at hand, with their execution order.
After the fitness function of each individual in the population is calculated as
described above, the traditional biased-roulette method (Goldberg, 1989)is applied
to the population to perform the selection ofthe fittest and construct the mating pool.
Crossover
The crossover operator applied is an extension of the traditional two points
crossover, with some additional restrictions to meet the requirements of the
assembly problem. Two crossover sites are randomly chosen for the two mating
parents. The rules of parent 1 and parent 2 are exchanged between these sites.
However, while exchanging the rules, areplacement procedure should be done as
follows to avoid duplications (refer to figure 3): Assurne we are replacing R12 at
position 2 ofparent 1 by rule R23 from parent 2. But R23 already exists at position
5. To avoid duplication, we replace the al ready existing R23 at position 5 by the
replaced rule R12 ofposition 2. Therefore, in the childl, R23 will be in position2
while R12 in position5.
Mutation
Two mutation operators is introduced to maintain complete sequences. The first
randomly seIects two ruIes their positions are exchanged. The other randomly
selects a rule and flips its order.
Sequence Repair
Mutation Reproduction
Crossover
Figure 4: GASS Schematic Diagram.
6 THE OVERALL ALGORITHM
The inputs of the overall algorithm are: (1) A set of rules and precedence constraints
describing the product, extracted from the its CAD design files. (2) A set of
evaluation assignments and constraints evaluating every rule according to its
enclosed assembly operations. (3) A set of machineIjob assignments classifying the
job families and their corresponding machines. (4) A set of job processing times,
showing the processing time for every job/operation, and the related constraints.
The detailed derivation of these sets is beyond the scope of this paper. The
overall algorithm GASS is shown in figure 4. It proceeds as follows:
• Step 1: Starting by the input sets, generate a random population [S/SRAN] of
MPOP sequencelschedule individuals, where MPOP is the nomber of
individuals in the population.
• Step 2: Apply the repairing procedure to transform the population [S/SRAN]
into a feasible population [S/SFES].
• Step 3: Calculate the fitness function of every individual as described above,
and apply the reproduction operator to prepare the mating pool [SiSREP).
• Step 4: Randomly choose a mate for every individual and apply the crossover
operator.
• Step 5: Apply the mutation operators. The result will be a new generation of
the random population [S/SRAN].
• Step 6: Repeat steps 3 through 5 until a termination criterion or an acceptable
solution is reached.
The method adopted in this paper to designate the result of GASS is the best-
so-far-individual, which designates the best individual obtained in any generation
of the population during the ron (Goldberg, 1989).
The reparation of the unfeasible individuals can be seen as a mapping that drives
any sequence in the entire search space into the set of feasible solutions. The whole
procedure can then be thought of as follows: The whole search space is clustered into
families of solutions, each having only one feasible sequence/schedule
Integrated planning and scheduling Jor multi-product job-shop assembly 383
~--_.CJ""'---:::-::::--'I"
ABC 0 E
em
Product 1: The pen example
~ .!-li' j j c · · .. iii:dii .. il!],..------O~ ___
~~.
A B C o
Product 2: The pencil example
Figure 5: A Prototype Example.
individual. A random population of individuals from random families are chosen to

undergo the genetic operations. Each random individual asks his farnily
representative -if he is not the representative himself- to represent him in these
operations. The new generated population is of stochastic nature, i.e. rnight include
ordinary farnily members -not representatives-. The same procedure is repeated,
where the new corresponding farnilies will send their representatives to be the next
feasible generation to undergo the genetic operations, and so on.
When the run is terminated, the obtained best sequence/schedule represents the
best sequence to assemble the products taking into account the effects of cascading
the operations in the resulting order, and the· best schedule that distributes jobs on
appropriate machines, without altering the physical product constraints.
7 AN ILLUSTRATNE EXAMPLE
A prototype example is constructed and solved to illustrate this methodology. It
consists of two products that should be assembled by two machines. The products
consisting of a pen and a pencil are shown in figure 5. The input sets of the
algorithm are derived to be as folIows:
Product 1
• Assembly mies: AD, BC, BD, DE.
• Assembly Constraints: BC <BD andBD <DA.
• Evaluations: ICBI = 4; IBC! = 12; (tight insertion)
IDBI = 3; IBDI = 9; (insertion)
IDAI = 2; IADI = 6; (loose insertion)
IDEI = 3; IEDI = 9; (insertion)
Evaluation Constraints: IfBC < BD then IDBI = 6 and IBDI=18
• Machine Assignments and processing times are shown in Table 1.
Processing time constraints: If BC < BD then BD ~ 4
Product 2
• Assembly mies: AB,AC,BC,BD,CD.
Table 1 Machine Assignments and Processing time of product I:
Rufe Machine: Time:

-AD MI I
-BC MI 3
-DE M2 2
-BD M2 2
Table 2 Machine Assignments and Processing time ofproduct 2:
Rufe Machine Time

-AB MI I
-AC MI 4
-BC M2 2
-BO M2 3
-CO M2 2
• Assembly Constraints: BC s; AC ; BC s; BO and AB S; AC.

• Evaluations: IBAI = I; IABI = 3; (contact)
ICBI = 3; IBq = 9; (insertion)
ICAI ;: 5; IAC! = 15; (rotation)
ICOI = 2; 10C! = 6; (loose insertion)
IBOI = 4; 10BI = 12; (tight insertion)
• Evaluation Constraints: If AB < BC then ICBI= 9 and IBq=27
IfCO < BC then ICBI= 6 and IBq=18
If BC < BO and BO < AC then IBDI= 10 and IBq=30
• Machine Assignments and processing times are shown in Table 2.
• Processing time constraints: If CO < BC then BO ~ I
IfBC < BO and BO < AC then BO ~ 2
In the evaluation assignments, it is assumed that moving the larger part and
assembling it to the smaller one (e.g. C to B) is evaluated three times more than
moving the small part and assembling it to the large one (e.g. CB).
The proposed algorithm is applied with appropriate operator rates for 100
generations with a population of 10 individuals. The planning, scheduling and
overall evaluations are shown in figure 6 (Ep, Es and Eovr respectively). It can be
seen that the sequence resulting in the best schedule (Es = 12) in generations 3 to
26 has a high planning evaluation of 19.5, and results in an overall evaluation of
31.5, while the best sequence/schedule has an over all evaluation of 26.5 , with
Ep=13.5 and Es = 13, which is not the best schedule. Sampies of the
sequence/schedules obtained at different generations and the corresponding
sequences and schedules are shown in figures 7 and 8 respectively. The fact that the
best schedule does not correspond to the best sequence, and vice verse, is imposed by
the highly constrained nature of the assembly scheduling problem.
lntegrated planning and scheduling for multi-product job-shop assembly 385
Figure 6: Fitness VS. Generation Graph.
1)Ep = 19.5, Es = 12, Eovr = 31.5, Gener.:3

·Seguence/Schedule:
CB2,CB1,CD2,BA2,CA2,DB1,DE1,DB2,AD1
2)Ep = 17.5, Es = 13, Eovr = 30.5, Gener.:28
·Seauence/Schedule·
CB1,BC2,AB2,CA2,DE1,DB1,DA1,CD2,BD2
3)Ep = 13.5, Es = 13, Eovr = 26.5, Gener.:80
·Segyence/Schedule:
CB1,CB2,BA2,DE1,CA2,DB1,CD2,DA1,BD2
Figure 7: Sampie Sequence/Schedule Results.
Sequence: Schedule:
P1: CB,DB,DE,AD
P2: CB,CD,BA,CA,DB
Ep=19.5, Es=12
_._.-._._._._._._.- .._........-._._._._ .... _._.
I
_._.~._._._._
Sequence: Schedule:
P1: CB,DE,DB,DA
P2: BC,AB,CA,CD,BD
Ep=17.5, Es=13
-----'-'-'-------'-'----r'-'---------'-'---'-'-'------_.
Sequence: i Schedule:
:!~ ~::~!:~=:~~,BD
Ep=13.5, Es=13
! ::BH.:rq: :'~r~ :: ! :
i 1234 5671 91011121314
Figure 8: Sampie Sequences and Schedules.
8 CONCLUSION
This paper addresses the problem of integrated assembly planning and scheduling
based on genetic algorithms. A new sequence/schedule representation is introduced
as a solution individual. Starting by a random population of individuals, unfeasible
individuals are repaired and then ordinary GA operators are applied. This procedure
is repeated until some stopping criteria are encountered. As a result, a best sequence
and schedule are generated simultaneously, thus overcoming the difficulties
encountered when planning and scheduling are dealt with separately.
9 REFERENCES
Fujimoto, H., Yasuda, K. and Iwahasi, K. (1994), Simulation Analysis of Design

Rule Sets for Multilevel Production Scheduling in FMS, in 'Proceedings ofthe
Japan-USA Symposium on Flexible Automation', pp. 811-814.
Goldberg, D. (1989), Genetic Algorithms in Search, Optimization, and Machine
Learning. Addison-Wesley Pub. Inc., pp.12-41.
Lucertini, M., Pacciarelli, D. and Pacifici, A. (1994), Layout Constraints
inAssembly Problems, in 'Proceedings of the Japan-USA Symposium on
Flexible Automation', pp. 765-768.
Pu, P. (1992), An Assembly Sequence Generation Algorithm using Case-based
Search Techniques". in 'Proceedings ofthe IEEE International Conference on
Roboties and Automation', pp.2425-2430.
Sebaaly, M. and Fujimoto, H. (1996) Automatie Assembly Planning Based on
Genetic Algorithms, in 'Proceedings ofthe IFAC'96 World Congress', Vol. B,
pp. 43.
WoIter, 1., Chakrabarty, S. and Tsao, 1. (1992), Mating Constraint Languages for
Assembly Sequence Planning, in 'Proceedings of the IEEE International
Conference on Roboties and Automation', pp. 2367-2374.
10 BIOGRAPHY
Milad Fares Sebaaly received his B.E. and M.E. in Electrieal Engineering from the
American University ofBeimt, Beimt, Lebanon, in 1991 and 1994 respectively. He
is currently a Doctor Student at the Mechanical Engineering Department ofNagoya
Institute of Technology, Nagoya, Japan. His research interests mainly include
factory automation, soft computing, assembly, robotics, concurrent engineering.
Hideo Fujimoto received his B. S. degree from Nagoya University in 1970, his M. S.
degree from Nagoya Institute ofTechnology in 1972, and his Doctor ofEngineering
degree from Nagoya University in 1980, a11 in Mechanical Engineering. He was a
visiting Professor at Technischen Hotchschule Aachen, West Germany, and at MIT,
USA from 1985 to 1986. He is currently a professor at the Mechanical Engineering
Department ofNagoya Institute ofTechnology, Nagoya, Japan. He is the reviewer
and editor of several international journals. His research interests mainly include:
CIM, automation, robotic systems, virtual reality, human interface, medical
mechatronies, etc.
34
Solution of the problem for a large
scale integrated plan in the iron and
steel production control
Mistushige Shiota and Sumihiro Manabe

Nippon Steel Corporation Group
2-8-9 Mitsu-sadadai, Yahatanisiku
Kitakyuusyu 807, Japan
Tel: +81-93-603-6092 Fax: +81-93-661-5554
E-mail: 14330423@people.orjp
Abstract
The main aim of this report is to explain the production scheduling system in the
iron and steel industry which has been developed as part of the consistent systems
of sales-production-distribution in the field of sheet-steel production. At the same
time, the key points for the solution and practical utilization of the production
scheduling system will be outlined.
Keywords
Production scheduling.
Man-machine cooperative processes. Iron and steel industry.

1 INTRODUCTION(background/target)
In recent years, in the iron and steel industry as weIl as in the field of other
manufacturing industries facing diversification of orders concerning high grade
products with low price, it is indispensable to reduce production costs, shorten the
production lead time and secure high quality. It is important to be able to produce
a large variety of ordered items, even though the amount may be smaIl, and to
supply the customer with fast delivery. Under such circumstances, the production
scheduling plays a very important role.
In the proceeding of planning for production, already a precise production
scheduling has to be worked out, which then has to be adjusted to every step in
order to reach an optimal consistent production scheduling. The conventional
batch process system which was used for a long time showed severe difficulties
concerning its flexibility - such as changes in the equipment or changes concerning
the ordered items and so on.
On the basis of the above mentioned problems, the authors constructed a
production scheduling system characterized by the consistent production
scheduling from the production of the basic material down to each production step
and secondly characterized by the man-machine cooperative processes.
2 OUTLINE OF THE PRODUCTIION CONTROL IN THE YAWATA

IRON AND STEEL MAKING PLANT
2.1 Characteristics of the production structure
The iron and steel production structure follows the "multistage manufacturing
process" composed of the large scale batch type equipment. Many sorts of molten
steel are made from the same molten iron, which then will be subdivided into
various intermediate products, using the "break-down" (fragmentation) process,
and will finally be changed into the products of the orders. Even though each
production process is adaptable to severe chance conditions (rearrangement
condition), it is desirable that a large amount can be produced under the same
condition.
A minimum of operation for re arrangement is desirable for the production and
distribution control concerning the multistage manufacturing process including the
facilities with severe chance conditions concerning a high standard of quality and a
reduction of the production costs. For such reasons, in-between each processing
step a selection of items is gathered for all products that can follow the same mode
of production. Such buffers for integration are used for each step.
Large scale integrated plan in the iron and steel productioll co/urol 389
2.2 Production control system
In the Yawata iron and steel making plant, on-line computer systems are used for
the sheet steel production and the field control for the products includes the
collection of the actual records and processing instructions to the filed.
However, the production scheduling control (preparation and revision of the
production schedule) is almost conducted by manpower, and the staff in charge of
scheduling each process is occupied only by the production scheduling control for
the process they are in charge of, so that they can not afford to carry out the
scheduling control for the consistent process. For this reason, the production
scheduling control can only be a "production control according to the inventory
between two processes". This conduction follows the form the "total frame
control" in order to balance the production amount in each process. In addition,
orders with severe delivery conditions are specifically controlled and be positioned
for exceptional control (Figurel).
2.3 Challenge
The correspondence to many various kinds of items and the production of only
small amounts in the form the present production control will cause an enormous
amount of inventory (buffer) between the processes and will lead to a raise in
production costs.
ro 11 i ng process plating process
~
~
t4ji ~ prepantion .. nd rn i . i on
of the product ion lohedul.
prep,ration .nd r.v i .ion
of the product ion achedul.
, in roll inl proct!1Ii " in plat ine proc:e ..
direDt. tran.f.,
Figure I Example of the present production control in the Yawata iron and steel
making plant
Therefore, in order to correspond to a large variety of orders and small

quantities at the lowest possible production costs it is essential to reach an ability
to plan an optimal production schedule for the consistent process and to realize a
flexibility conceming the variations of the environment and constraint during
manufacture. Correct timing for necessary rescheduling is very important.
3 CHARACTERISICS AND SOLUTION OF THE PROBLEMS FOR

THE IRON AND STEEL PRODUCTION CONTROL
3.1 Characteristics ofthe problems
In order to solve the above mentioned problems, it is necessary to assume the

processes between the steel making, hot rolling and sheet steel processes as a
continuous and consistent process and to plan the consistent schedule in
consideration of the constraint conditions such as the passage constraint, the
equipment constraint, and so on. for the total material resources.
However according to out judgment that it is unrealistic to solve the complex
and large scale combined optimization problem including complex evaluating
function, the constraint condition and the large scale material resource as one large
scale problem, we have decided to divide the problem into partial problems and to
combine the structures in order to get a total optimal solution ainling at the whole
conformity by considering each optimal solution.
3.2 Solution of the problem
3.2.1 Structure of the solution
The large scale combined problem has been divided into three partial problems as
follows (Figure2).
problem of tbe production

plan for tbe steelmaking
and bot rolling
( objective function )
( constraint condition )
job instruction for tbe job instruction for the steelmaking

sbeet steel process and hot rolling process
Figure 2 Structure of solution

Large scale integrated plan in the iron and steel production contral 391
1. Problem of enhaneed aeeuraey eoneeming the material resouree for planning
As shown in the previous ehapter, in the eonventional planning the flow frame
(roughly classified material resouree for order) was treated as one unit. Therefore,
the plan was vety rough and will fall far short of the realistie plan, even after the
eonsistent plan is made. The more eonsistenee is aimed at, the more important the
problem beeomes.
2. Problem of the partial planning for steel making, hot rolling and sheet steel
production planning.
A production plan will be made for eaeh of the steel making, the hot rolling and
the sheet steel processes eoneeming the accurate material resouree. More than in
previous times, eoneeming the development of the algorithm aiming at the
enhaneed operation rate for equipment with eonsideration of the equipment
eonstraint and the passage eonstraint, ete., the flexibility of the plan still remains
as a very important point. A flexible proeess adjustable to the eireumstanees has to
aim at a suitable arrangement for the best harmony with human beings.
3. Total optimal problem.
The total optimality is oriented by ineorporating the solution of the above

mentioned problem as the mutual eonditions of eaeh algorithm.
Beeause these processes eorrespond to varied aetual reeords, the system needs
daily planning. The eontent of the measure for eaeh problem is briefly explained
as folIows.
3.2.2 Measure of enhanced accuracy concerning the material resources for

planning.
Assuming the material resouree of the order as the virtual produet, the material
resouree is produeed aeeurately - refleeted by the preeise data, the produetion
amount and by the daily varying aetual reeords, whieh ean be produeed.
Utilizing the temporary manufaeturing information used for the material
design in the previous proeess, the material resouree has been produeed with
additional information whieh is used for planning. In this system, the temporary
manufaeturing information has been defined as a design (virtual) production
information (Figure3).
Also in the real produet information, the varied information in the daily plant
operation, that is preeisely eaught, is refleeted to the material resouree serving as a
basis for planning.
................................. . .......... . . . ................

upper system
material plan ~ "aried order
virtual weight spec.

products 00 request date 8Upp!y
for production date
virtual weight spec. in the hot daily v&ried
rolling experieoces
weight spec.
consisteot plan
Figure 3 Virtual production infonnation
3.2.3 Solution of the partial problem (problem of the steel making and hot
rolling as weil as the sheet steel production planning).
Aiming at the optimality of each independent plant operation in the steel making,
hot rolling and sheet steel process, the development has been conducted as
folIows.
I. Development of the schedule algorithm
a. Outline of the schedule algorit1un for sheet steel The planning problem is
fonnulated as folIows.
Objective function : Equipment operation ratio

Constraint condition : Delivery limits of the orders, plant capacity
(production capacity, yard capacity)
Though the problem was divided, the scale of the material resource is great. In our
case, the nurnber of processing lines for sheet steel is 58 and the material
resources are about 10,000 units.
Large scale integrated plan in the iron and steel production control 393
Further, on account of the daily processes, the operation time for solution is
constrained to a large extent and the problem is too difficult to be solved as a
simply combined problem. The following algorithm is administered for the early
solution of the problem.
• Arrangement ofthe material resource along the delivery-limit information

• Accumulation of the total schedule - starting from the lowest production
capacity processes.
• Arrangement of the supply-demand balance for material between processes by
means of the recurrence method.
b. Outline ofthe schedule algorithm for the steel making and hot rolling
As different from the problem of the sheet steel process planning, the delivery
time - (because it is not an order delivery but a manufacturing delivery) - has not
been included in the constraint condition but is arranged as an evaluating function.
[formulation]
Objective function : Equipment operation ratio and sheet steel request
delivery
Constraint condition : Plant capacity (production capacity / yard capacity)
This algorithm is heuristic, and the following device is administered for the early
solution of the problem.
• Preparationlapplication ofthe standard pattern with schedule arrangement

• Setting of the priority condition for each process (priority of production
efficiency, priority ofproduction capacity, priority ofspecial steel, etc.)
2. Process in harmony with manpower
The key point of this process is GUI. Further, the visualization of the schedule
result on the Gnat-chart and the interface with operational excellence, are
constructed.
Using this interface, the schedule can be simply revised and evaluated.
In the meeting place where a plurality of personnel in charge can gather at a time
for discussion, a large format drawing with the so-called 120-inches is set up.
Figure4 indicates the operational procedure ofthe system.
!arge sire screen ® completion of plan

date
proc:e:s~:~ ::ii;-:
proce••~.1! .:. . .
0: _:. decision final
proce.sf.Q .:.. • :": . =tio::::n::.....::o;:.f+-t production
I<E-m='::;:dica=:' ~ production
proce••~.~.: • production plan plan
proce.s!I.~.: • ..,;;, • plan
proce.a~ .F•• :. . • • ; :'"•••
@ disoussion of
re-arrangomont
procesa B
@ arrangement by man re-arrangement
Figure 4 Operational procedure of the system
3.2.4 The total optimal solution
The solution of both planning problems is incorporated into the mutual constraint
condition in order to get the whole optimization. Tobe more specific, the depot
for the steel making and hot rolling process as weIl as for the sheet steel process is
the exact time schedule for each coil, and the procedure is as folIows:
Step 1: problem of the sheet steel plan

Step2: problem ofthe steel making and hot rolling plan after the problem ofthe
sheet steel plan is solved and registered.
Step3: problem ofthe sheet steel plan after the problem ofthe steel making and
hot rolling plans has been solved and registered.
With respect to the operation instruction, daily operation instructions are

published for each plan of the individual process, and it concludes that the
operation is conducted according to these instructions (FigureS).
Large scale integrated plan in the iron and steel production control 395
material control. varied ord e r varied order

order intak e ' introduction proceu.
load arrangement ,-_---"E....-_--" qualitative design (.creening)
" ...... 'M of t ... lot ,ollla.

eon.iatent plan hu.ntlt,."ate>
(w aeltl,. ]Ilan) )
(dailyexecution)
experience.
cOßsietent oteelmaking and

production oyotem bo t .olling
plant operation
l?igure 5 Total optimal solution
4 COMPUTER SYSTEM
In the computer technology, we developed our technology so that it can serve as a

basis of various kinds of distribution technologies, including the development of
the memory control system for high performance of algorithm, development of the
cooperative distribution for the cooperation with human beings, development of
the remote and centralized monitoring system for the WS, and so on.
5 APPLICAnON EFFECT
This system is now in operation in the Yawata iron and steel making plant of
Nippon Steel Corporation. At present, it is under the evaluation of the introduction
effect, but is largely contributed to the administrative challenge, such as the
shortened term for planning, reduced inventory, and so on.
6 CONCLUSION
The example of the consistent production plan in the iron and steel industry has
been introduced. The key point of this system is that the large scale consistent
planning problem has been divided into the partial problems, and further, the
partial problems have been arranged with the cooperative system with human
being.
Wehave respected the superiority of the human ability to assess the
circumstances over the computer and arranged each system as a cooperative
system. In the future, we are thinking about the application of GA(Genetic
Algorithm) technology transporting the decision making ability according to the
circumstances to the computer in order to reduce the burden on humans.
It seems to be important that the effect of this planning system leads to an
understanding of the main (on-line) system which is collecting the actual records
and another very important point is the plant operation technology which ensures
an exact realization in the proceedings.
We shall be happy if this report is of a help toward the construction of more
effective production control systems in the future.
7 REFERENCE
Hiroshi KONNO, Hisatoshi SUZUKI : Integer programming and combined

optimization. OR library, 1982.(in Japanese)
Kei NAGAI, Kyoji TAMURA, Masayuki NAKAYAMA, Takashi TANIZAKI,
Hiroshi NAKAJIMA : Construction of the man-machine cooperative type
scheduling system with distributed environment, Communication of the
Operations Research Society of Japan, May 1995. (in Japanese)
8 BIOGRAPHY
Mitsushige Shiota is General Manager at Logistics Division, Nippon Steel

Corporation Group. He received B.E., M.E. in Applied Mathematics and Physics
from Kyoto University, Kyoto, Japan, in 1966 and in 1968. His areas of interests
are applications ofOR, logistics and production control.
Sumihiro Manabe is Group Manager at Computer System Department, Nippon

Steel Corporation, Yawata Works. He received RE., M.E. in Production System
from Toyohashi University Technology, Toyohashi, Japan, in 1978 and in 1982.
His areas of interests are applications of OR, System technical engineering and
production control.
PARTSEVEN
Production Scheduling
35
An autonomous job shop scheduling
system under dynamic production
environment considering machine
breakdowns
Haihong Shin anti Mitsuru Kuroda
Department o/Intiustrial & Systems Engineering
Aoyama Gakuin University, Tokyo 157, Japan
Tel: +81-3-5384-1111 ext. 3503 Fax: +81-3-5384-6516
shin@cim-lab.ise.aoyama.acjp
kuroda@cim-lab.ise.aoyama.acjp
Abstract
This paper describes an autonomous job shop scheduling system where multiple
kinds of products are produced on a repeated basis and the dispatching rules are
controlled automatically by a neural network. The production model we considered
is refined from a real-life semiconductor manufacturing process in which required
throughputs are expected to be realized. We concentrated our attention firstly on
some dispatching rules and their features. One combinatorial rule was then
constructed for the dynamic production in which machine breakdowns occurred,
while the combination coefficient was directed accordingly by the outputs of the
neural network. The results of numerical experiments are shown, and the
possibility of constructing such an autonomous scheduling system and its
effectiveness are examined.
Keywords
Autonomous scheduling, Dispatching rule, Neural network, Semiconductor
manufacturing
1 INTRODUCTION
With the rapid increase in popularization of computers all over the world,
semiconductor industry has been shown and still continues to show its importance
400 Part Seven Production Scheduling
in any nation's industry and economy. Although the technologies of semiconductor

manufacturing improved rapidly for the last few decades, the researches
conceming production planning and scheduling problems encountered in this area
have been far from noticed until recently. Uzsoy, et al.(1992, 1994) give a quite
thorough survey about production planning and scheduling models in the
semiconductor industry from the aspects of system characteristics, performance
evaluation, production planning and shop-floor control. One conclusion is that the
complex nature of semiconductor manufacturing provides an area where the use of
more advanced techniques may yield considerable benefits.
Chen, et al.(1988) develops a mixed nature queueing network model of a
research and development wafer fab operation, which is used to predict certain key
system performance measures such as throughput rate for lot category. They
compare the predicted values with actual observed ones and find the difference to
be within about 10%. Dayhoff and Atherton(1987) present highly structured
queueing network simulation models of wafer fabs, and use them to study the
dynamics of semiconductor manufacturing operations (wafer fabs) and establish
management policies for efficient and stable operation.
Kimemia and Gershwin(1983) consider an automated manufacturing system
subject to equipment failures for the objective of meeting production requirements
while the machines fail and are repaired at random times. They designed a
hierarchical algorithm to fit into existing factory management structures in order to
control the production while reducing the off-line computational effort. Seidmann
and Tenenbaum(1994) focus on the problems of maximizing the throughput rate in
FMS. They developed dynamic part-allocation policies for those systems having
finite storage capacity at each work station and compared them with some close-
loop heuristic control policies. And they found those heuristic policies are of
practical significance because they are extremely easy to compute and to
implement, while the resulting FMS performance is nearly optimal.
An approach called Inverse Queueing Network Analysis (IQNA) has been so far
researched by Kuroda and Kawada(1994), by which the desired level of Work-In-
Process (WIP) could be obtained to achieve required throughputs of each lot
category and minimize their cycle times approximately. A closed queueing network
model is constructed to render some kinds of semiconductor manufacturing and a
simulated annealing algorithm is used to achieve the heuristic searching for the
objectives. The significance of the method is presented by observing and
discussing computational results of a sampie problem from a hypothetical
semiconductor manufacturing process. IQNA gives the fundamentals to this
research and part of its significance can be also observed in the early experiments'
results presented in Section 3.
This paper describes an autonomous job shop scheduling system for a
production type with some typical characteristics from wafer fabs where multiple
kinds of products are produced on a repeated basis. By saying autonomous
scheduling system here, we mean it is able to make decisions with minimal external
direction in order to realize the required objective. In this research, the objective is
An autonomous jobshop scheduling system 401
to keep the realized throughputs of each production type to their required values
(definitions of realized and required throughputs will be given in 2.1). Therefore,
the system is sensitive to the discrepancy between the above throughput values, and
then will try to decrease it by adjusting dispatching rules, especially when machine
downtimes happen which will upset the balance between production ability and
work load, and lead to overloaded production situations.
In order to construct such a scheduling system, dispatching rules are examined
firstly while their effects are observed and analyzed by simulation experiments
under both steady state and overloaded conditions of the production model. A
combinatorial rule is then constructed by using the features of single dispatching
mIes for the dynamic production in which machine breakdowns occur with no
regulation, while the combination coefficient is directed accordingly by a back-
propagation neural network. The results of numerical experiments done by
simulation will be shown in the following and some discussion and commends will
be made.
In Section 2, we will introduce the production model considered in this research,
by emphasizing its connections to some features of semiconductor manufacturing,
especially wafer fabs. Dispatching rules and their effects are examined by some
simulation experiments in Section 3, and the autonomous job shop scheduling
system is introduced in Section 4. We conc1ude this research carrled out so far in
Section 5, and some future researches are also presented.
2 PRODUCTION MODEL AND INPUT CONTROL
2.1 Production Model
Production model considered in this research is refined from part of semiconductor

manufacturing operations called wafer fabrication which is conducted in a wafer
fab. Wafer fab can be viewed as a job shop containing a number of single-server
and/or multiserver stations(Wein, 1988), and is regarded as the most
technologically complex and capital intensive among all the phases of
semiconductor manufacturing. One example is a VLSI microprocessor which
might involve a total of perhaps 200 distinct fabrication steps and the
manufacturing interval might be 5-10 times the theoretical(Chen, et al., 1988).
Detailed descriptions of the wafer fabrication and its modeling could be found in
Dayhoff and Atherton(1987). Following are those factors and features considered
in this research which belong to wafer fabrication.
1) Product type is used in this paper to represent the kind of wafers. And a lot is a
collection of wafers that traveI together through the whole process flow[see 2)]. It
is the basic unit in this production model and also for any calculation in this
research, such as throughput, cycle time, etc.
2) Process flow is a special list of processing steps for each product type. Each
processing step is achieved and therefore represented by a workstation[see 3)]. One
dominant characteristic of wafer fabrication is so called reentrant production
flows, which means for some particular operations, a lot has to visit a workstation
more than once. For example, a wafer may have to visit the photolithography work
station nearly ten times to have alllayers of circuitry fabricated.
3) A workstation is a collection of equipment performing the same processing
steps. It functions like a multiserver system, for the arriving lot may be operated by
any available machine in it and each machine maintains a fixed service time for
each product type in this research. Machine downtime is only considered when
machine breakdown occurs, while the latter is set to be arbitrary with no
regulations in both breakdown times and intervals.
4) A required throughput is set to each product type, as the objective of the
production model considered in this research. Exclusive of those fabs which are
tightly coupled to the back-end operations (those operations after wafer fabrication
and probe, such as assembly and final test), the approach to buffer the wafer fabs
against fluctuations in the extemal demands by holding inventories between the
front-end and back-end operations, is still considered to be significant and realistic.
Hence, wafer fabs considered in this research still tend to operate in a make-to
stock mentality, with production lots rarely associated with a specific customer
order or due date. Because of the high capital costs of equipment, this has resulted
in a major emphasis on maintaining high throughput and equipment utilization,
while reducing both the mean and the variance of cycle times (the time between a
lot entering the fab and the completion of its manufacturing) and inventories.
Different kinds of wafer fabs with different objectives are introduced in Uzsoy, et
al. (1992).
5)Work-In-Process (WIP) level of each product type is to be a constant for the
production model considered in this research belongs to a closed one, which means
new lots will enter the model only as old ones complete the processing. The WIP
level could be calculated from the required throughput by IQNA.
2.2 Input Control
Input control is regarded as one of the flow control mechanisms which have great
effects on the performance of a job shop. Wein (1988) considers three versions of a
wafer fab model and four different types of input mechanisms for it. He reaches a
conclusion that input control has a significant impact on the performance of
semiconductor wafer fabrication.
We use IQNA approach to calculate the WIP level for each product type which
satisfies the required throughput. A simplified overall concept of IQNA is shown in
Figure 1, where performance measures are both EI representing the discrepancy
between the realized throughput Xi and the required one Xi' of product type i; and
E2 as the cycle time Ri •
The input of IQNA is Xi· and the output is the WIP level Ni· of each product type i.
Besides Ni> other inputs to the c10sed queueing network model inc1ude average
number of visits Vij to a workstation j by product type i, and average operation time
per visit Sij' while the outputs also include utilization Vj of workstation j, average
queueing length Qj and average residence time Rij at workstation j of product type
i.
·:
r· .. · .. _ .... ·· .... · .......... · .. · .... • .... · ........ • .. ·• .. •· ...... · .... · .. · .. •
.:
··· min EI, min E2
....
··· !
··· Simulated ....
:
N1·*:: Annealing
E
Ni Xi,Rij
~ Closed Queueing -
Network Model
~Vij, Sij
..................................................................................
Vj,Qj
Figure 1 Inverse Queueing Network Analysis.
The production model considered in this research is shown in Table 1, where

there are 5 product types which have different process flows respectively. The WIP
level of each product type is ca1culated by IQNA explained above. The model
consists of 6 workstations which are composed of multiple machines respectively.
Table 1 Production Model.
Product Numberof Through- WIP Wode- Numberof

Type Processes put level station Machines
1 16 0.3138 14 1 2
2 18 0.2019 28 2 4
3 3
3 18 0.2776 20
4 5
4 17 0.2310 21
5 3
5 19 0.3567 33 6 2
3 DISPACHING RULES AND EFFECTS
Dispatching mIes are used to decide which lot is to be operated next when a
machine becomes available. Due to wafer fabrication's complexity, especially the
necessity for reentrant production flows, dispatching schemes are regarded to be a
key and a complicated element in wafer fab operations(Dayhoff and Atherton,
1987). Vzsoy, et al. (1994) give a review of dispatching researches in the area of
semiconductor manufacturing. An interesting research is done by Adachi, et al.

(1988), which develops a pattem-recognition-oriented Control Decision Support
System (CDSS) in order to set the best control strategy, including dispatching one.
They use simulation experiments to examine the relations between system
performance and management decision variables, which this research uses to
ex amine some dispatching rules and their effects on the closed production model
described in Section 2.
Four different dispatching rules are examined for the production model: FIFO
(First-In-First-Out), which decides the priority of the lots in the waiting line
according to their entrance sequence, and is the most popular rule in realistic
situations; SPT(Shortest imminent Processing Time) gives the highest priority to
the lot with the shortest processing time in the imminent operation, which always
shows to be the best rule conceming the measurement criterion of average cycle
time; slack value of each lot is defined in this research as the remaining of five
times total processing time minus time spent in the shop up to now, while a rule
called SLACK is use<! to give highest priority to the lot with least slack value; and a
rule called LLTA(Largest Lateness of Throughput Achievement). As explained
previously, the measurement criterion we consider are the accumulated
throughputs of the production. By LLTA rule, those product types with lateness of
realized throughputs comparing to required ones have higher priority.
Parts of simulation results are shown in Figures 2-4, so as to examine the four
rules' effects under steady state production, while under overloaded condition
when the required throughput rates are set to be extremely high for the same
production model, Figure 5 shows the relative results of simulations.
AccußlJlated Throughput
3500
3000
2500
2000
1500
1000
500
o
70001 70501 7J.00I 7.1501. 7200\ 72501 73001
SlD1.Ilauon ture urut
Figure 2 Comparison of throughput achievement of different rules.
Figure 2 shows some significance of IQNA approach, for the simulation results of
accumulated throughput, the result obtained by using FIFO rule for example, is
very close to the required values. Also, we find FIFO rule is shown to be the best
rule under steady state condition wh ich means the relation between production
ability and workload is balanced. It gives best values for both throughput and cycle
time. On the other hand, LLTA rule leads to worse values of cycle time's
deviations when compared to FIFO rule, though the values of throughput and
average cycle times are comparable to those obtained by FIFO rule. However, it is
fl ,[1,[1,[1
Average Cycle TiIre
~~ ~
~tr.,
Product Product Product Product Product
type 1 type2 type3 type4 typeS
Standanf Deviation ofCycle Time

typel type2 type3 type4 typeS
Figure 3 Comparison of cycle times.

Mean Value of Waiting TiIre
,~, -,
Worlc- Worlc- Worlc- Worlc- Worlc- Worlc-
stationl station2 station3 station4 station5 station6
Figure 4 Comparison of average waiting times.
lJiteness ofThroughput
typel type2 type3 type4 type5
:l l r[] 1I 1I [J
-250
Figure 5 Comparison of lateness of throughputs under overloaded production.
noticed that by LLTA rule the average waiting time before the bottleneck
(Workstationl, which is shown to be the busiest one by FIFO rule) is much shorter
than the value got by FIFO rule. (See Figure 4) This might be the main reason for
the less deviation of lateness among product types under overloaded production by
using LLTA rule, shown in Figure 5. That is, LLTA rule has good effects on
balancing the lateness among product types, especially under overload conditions,
as it seems to be able to rearrange the production progresses in an appropriate
speed to each product type.
4 AUTONOMOUS JOB SHOP SCHEDULING SYSTEM
The features of FIFO and LLTA are used in our scheduling system for dynamic
control of the closed production model. A combinatorial rule is constructed as
folIows:
a X FIFO + (l-a) X LLTA a : coefficient
where the value of a is to be changed according to the production situation.

Tbe scheduling system we construct is shown in Figure 6, and is called
autonomous job shop scheduling system which is expected to realize automatic
control of the dispatching rule so as to keep efficient operation under the varying
production conditions.
PI
P2
P3
--+
--+
--+
~ ~ ~ --+ LXI
--+ LX2
--+ LX3
P4
PS
--+
--+ ~ ~ ~ --+LX4
--+ LXS
Producoon Model
L(Xl*-XI) --+
L(X2*-X2) --+
L(X3*-X3) --+ --+ er
L(X4*-X4) --+
L(XS*-XS> --+
Neural Networlc
Cj : Worlcstationj
Pi : Product Type i
I: Xi : Accumulated Realized Throughput of Product Type i
I: xt: Accumulated Required Throughput of Product Type i
Cl : Coefficient of Combinatorial Rule
Figure 6 Autonomous Job Shop Scheduling System.
We have done a research about autonomous job shop scheduling which considers
an open job shop production model and controls the dispatching rules for those
machines in bottleneck. The possibility of autonomous job shop scheduling in a
varying environment has been verified(Shin, et al., 1995).
The neural network in Figure 6 is the control organization in the system, whose
output sets the coefficient value of the combinatorial rule. The inputs of the neural
network are the discrepancy of the required throughput and the realized one for
each product type at a time. The neural network belongs to a supervised back-
propagation feed-forward one, so it needs to be trained by data in which known
relations between the inputs and outputs are contained so as to calculate any
corrections for the weights of connections between neurons.
4.1 Training Data for the Neural Network
We use simulation experiments to examine the relations between the lateness of

throughputs and the coefficient of the combinatorial rule. In a steady state
production environment, an arbitrarily specified machine breakdown is generated
and then after adefinite period the lateness of throughputs could be inspected. Two
experiments with different dispatching rules are held from this point: one keeps the
dispatching rule as FIFO and the other uses a combinatorial rule with testing
coefficient values. Both results will be recorded after adefinite period, and those
coefficient values which cause the improved results by the combinatorial rule than
the results obtained by FIFO are regarded as the appropriate values corresponding
to the production situations at that time, and then will be used to train the neural
network.
Some of the training data are shown in Figure 7, from which we could fmd that
with the increase of machine breakdown time which leads to the increase of the
lateness of throughputs, the value of the coefficient becomes smaller which means
the decrease of FIFO rule's effects and the increase of LLTA's.
4.2 A Test Experiment
Figure 8 shows the results of an experiment which is used to test the effectiveness
of the scheduling system. A production process is observed during 300 simulation
time (from 7000t to 7300t simulation time) which is under different production
conditions and dispatching rules. Anormal production is held firstly which is under
steady state and the dispatching rule is FIFO, and the realized throughputs are
recorded by every 50 simulation time interval. Then the same production is held
with FIFO rule in which machine breakdowns occur in simulation time 7000t,
7100t and 7200t. Throughputs appear to be decreased obviously. Finally, we use
the autonomous job shop scheduling system to control the production with
machine breakdowns occurring.
By comparing the results in Figure 8, we find that the effectiveness of the
autonomous scheduling system is much more obvious in the front part of the
experiment. That is, the combinatorial rule works quite weIl when the lateness of
throughputs are not so severe. However, even so, the throughputs could never
recover to their original values.
t§
Macbine Breakdown for 8t
zoo rr----~--~~
2880 Lateness of acCUIIIllated
throughput iqJroved for
42.=9%::...:.:.._ _ _ _ _--'
LL::
2780 (a : 0.95)
2700 ~------------~--------------~
7000t 7050t 7100t
MacmneBreakdownforl~
zoo-,----------,
2880 _ Latenes s of acculllllated
.. throughput iqJroved for
6,2860-
..c:: 62.5%
f~ ~~-----~
~28W-
2800
2780 - (a: 0.8)
2700 ~-------~-------~
7000t 7050t 7100t
Macbine Breakdown for 35t

zoo-,------:--------:-~
2880 _ Lateness of acculllllated
2860 _ throughput iqJroved for
':li ~ 1_6._7%-'--_ _ _ _-----'
_L
.8-
f28W-
~ 2800 -
2780 - (a: 0.55)
2700 ~-------~-------~
7000t 7050t 7100t
Macbine Breakdown for l00t

zoo -,--------,
2880 _ Lateness of acCUlllllated
... 2860 _ throughput iqJroved for
j. ~ <=15=.2=%_ _ _ _-'
CID
::s 28W -
~2800
2780 -
2700 ~~------~-------~
7000t 7050t 7100t
SiIIIllation time
Figure 7 Some portions of training data.

3160 () are a' s

changi ng val ue
3110
3060
1 3010 realized throughput
cOnDi natori al rul e when
l2960 PG"S rul e when Imchi ne
~ 2910
breakdowns occured
2860
2810
(0.95) (0.75) (0.75) (0.0)
TI60 ~------~------~------~--------~------~------~
7CXXlt 7050t 7100t 7150t 1200t 7250t 7300t
Sinmlation time
Figure 8 Example of simulation results.
5 CONCLUSION AND FUTURE RESEARCH
An autonomous job shop scheduling system is constructed and examined in this

research. The production model includes some features extracted from wafer fabs,
and is constructed to be a closed one. WIP level of each product type is decided by
using IQNA and their required throughputs.
Some dispatching rules and their effects on the performance of the production
are examined, and a combinatorial rule is constructed by using different features of
FIFO and LLTA. FIFO rule is shown to be the best rule under steady state
productions, while LLTA rule is observed to have good effects on balancing the
lateness among product types, especially under overloaded production situations
or when machine breakdowns occur.
Simulation is used to examine the relations between the lateness of throughputs
and the coefficient of the combinatorial rule, and the results are used to train the
neural metwork which is the controller of the autonomous scheduling system.
Results of a test experiment are shown and the possibility of constructing such an
autonomous scheduling system and its effectiveness are examined.
However the effectiveness of the system is far from satisfactory and practicable.
Two different directions of future researches are being considered. One is to
continue the research of dispatching rules in much more detail. Considering the
reentrant production flows in wafer fabs, the dispatching schemes could be
regarded as a hierarchical one, and the dispatching rules are required to satisfy
three level functions(Dayhoff and Atherton, 1987). The other is the hybrid
utilization of IQNA and the autonomous control which aims to realize scheduling
control more effectively.
6 REFERENCES
Adachi, T., Moodie, C. L. and Talavage, J. J. (1988) A Pattem-Recognition-Based
Method for Controlling a Multi-Loop Production System, Int. J. Prod. Res.,
Vol. 26, No. 12, pp. 1943-1957.
Chen, H., Harrison, M., Mandelbaum, A., Ackere, A. V. and Wein, L. M. (1988)
Empirical Evaluation of a Queueing Network Model for Semiconductor Wafer
Fabrication, Operations Research, Vol. 36, No. 2, pp. 202-215.
Dayhoff, J. E. and Atherton, R. W. (1987) A Model for Wafer Fabrication
Dynamics in Integrated Circuit Manufacturing, IEEE Tran. on Systems, Man
and Cybernetics, Vol. 17, No. 1, pp. 91-100.
Kimemia, J. and Gershwin, S. B. (1983) An Algorithrn for the Computer Control of
a Flexible Manufacturing System, llE Tran., Vol. 15, No. 4, pp. 353-362.
Kuroda, M. and Kawada, A. (1994) Optimal Input Control for Job-Shop Type
Production Systems Using Inverse Queueing Network Analysis, International
Journal 0/ Production Economics, 33, pp. 215-225.
Seidmann, A. and Tenenbaum, A. (1994) Throughput Maximization in Flexible
Manufacturing Systems, IIE Tran. Vol. 26, No. 1, pp. 90-100.
Shin, H., Kuroda, M. and Takeda, K. (1995) Autonomous Job Shop Scheduling
Using Neural Network, in Proceedings 0/18th International Con/erence on
Computers & Industrial Engineering, Vol. 1, pp. 319-323.
Uzsoy, R., Lee, C. and Martin-Vega, L. A. (1992) A Review of Production Planning
and Scheduling Models in the Semiconductor Industry Part I: System
Characteristics, Performance Evaluation and Production Planning, llE Tran.,
Vol. 24, No. 4, pp. 47-60.
Uzsoy, R., Lee, C. and Martin-Vega, L. A. (1994) A Review of Production Planning
and Scheduling Models in the Semiconductor Industry Part 11: Shop-FloOf
Control, llE Tran., Vol. 26, No. 5, pp. 44-55.
Wein, L. M. (1988) Scheduling Semiconductor Wafer Fabrication, IEEE Tran. on
Semiconductor Manu/acturing, Vol. I, No.3, pp. 115-130.
7 BIOGRAPHY
Haihong Shin received B.S. and M.S. degrees in Mechanical Engineering from
Shanghai Jiao Tong University, Shanghai, P. R. China in 1990 and 1993. Sinee
1994, he entered the Ph.D. course in the Department of Industrial & Systems
Engineering of Aoyama Gakuin University, Tokyo, Japan. His research interests are
in scheduling and production management.
Mitsuru Kuroda received B.S., M.S. and Ph.D. degrees all from Waseda University,
Tokyo, Japan in 1961, 1963 and 1969. From 1969 to 1978, he was an Associate
Professor at the Department of Industrial & Systems Engineering, Aoyama Gakuin
University, since 1978, where he is currently a Professor. His research interests
include production systems, production management and manufacturing strategies.
36
A study on holonic manufacturing
systems and its application to real time
scheduling problems
Nobuhiro Sugimura 1, Toshimichi Moriwaki2, and

Keiichi Hozuml
1 College 01 Eng., Osaka Prelecture University,
Gakuencho, Sakai, Osaka 593, Japan,
Tel:+81-722-52-1161, Fax:+81-722-59-3340
E-mail: sugimura@center.osakalu-u.ac.jp.
2 Faculty 01 Eng., Kobe University,
Rokkodai, Nada, Kobe 657, Japan,
3 ShiMaywa Industries Ltd.,
6-107, Tachikano, Takarazuka, 663, Japan.
ABSTRACT
The objeetive of the present research is to develop an holonie arehiteeture of manu-
facturing systems. A eoneept of the holonie strueture of manufaeturing systems are
diseussed, and an objeet oriented modeling method is proposed to represent the
data and the aetivities of the holonie eomponents of the manufaeturing systems,
such as workpieees, workstations, maehine tools, AGVs and so on. Objeet oriented
models are developed to represent simulation models of the holonie manufaeturing
system for the meehanieal produets and one for the eomposite parts of the airerafts.
Prototypes of the holonie real time seheduling systems are developed based on the
simulation models, and ease studies are earried out.
Keywords
Holonie manufaeturing system, Real time seheduling, Object-oriented model,
Simulation

1. INTRODUCTION
With advances of manufacturing technologies in both software and hardware,

automation of manufacturing systems in batch production has been much devel-
oped. The control structures of the manufacturing systems, such as FMSs (Aexible
Manufacturing Systems) and FMCs (Aexible Manufacturing Cells), are generally
hierarchical. The hierarchical control structure is suitable for economical and effi-
cient batch productions in steady state, but not necessarily so for very small batch
productions with dynamic changes in the volumes and varieties of the products.
Functions and capabilities of FA (Factory Automation) controllers have made

much progress in the last decade, and individual controllers are now able to share
information processing and decision making capabilities in the manufacturing
systems. New architectures of the manufacturing systems are therefore proposed
aiming at realizing more flexible control structures of the manufacturing systems
which can cope with the dynamic changes in the volume and the variety of the
products and also the unforeseen disruptions such as breakdown of equipment and
interruption by high priority jobs (Okino, 1992), (Ueda, 1992), (Moriwaki, 1992),
(Warnecke, 1993), (Iwata, 1994), (Wiendahl, 1994), (Sugimura, 1995), (Wyns,
1996), (Gou, 1997), (Bongaerts, 1997), (Arai, 1997).
Some researches have also been carried out for establishing modeling techniques of
the manufacturing systems (Patankarm, 1995), (ISO TC 184, 1989), (AMICE,
1992), (Petrie, 1992). The models proposed provide basic framework for the
modeling of the manufacturing systems including the holonic manufacturing sys-
tems.
The objective of the present research is to develop an holonic architecture of the

manufacturing systems. A concept of the holonic structure of the manufacturing
systems is discussed, and a holonic real time scheduling method is proposed in the
paper. The main topics discussed in the paper are as folIows;
(1) basic architecture ofthe holonic manufacturing system (HMS),
(2) object oriented modeling of HMS, and
(3) holonic real time production scheduling of the manufacturing systems for
mechanical assemblies and composite parts.
2. BASIC ARCIDTECTURE OF HOLONIC MANUFACTURING

SYSTEM
The holonic manufacturing systems are composed of sets of autonomous and coop-
erative components called holonic components, which incIude such components as
workstations, AGV s, storages and workpieces. The individual holonic components
A study on holonic manufacturing systems 413
have functions of infor-

Holonk P'roduction Control System(Logical Mod~l)
mation processing, deci-
sion making and commu-
nication, and also material
processing for the manu-
facturing.
Figure I shows a basic

concept of the holonic
manufacturing systems. t
Modeling
The physical model de-
scribes the holonic com- I
ponents of the manufac- Real Manuracturing System (Physlcal Model)
turing systems and the

flows of the materials in
the systems. The logical
model gives the holonic
information processing
and the decision making
structures in the systems.
As shown in the figure, the
production control of the
system is carried out
• Workpiece o Machine Tool o Peripheral
through the decision c:::> AGV c=J Storage
making of the individual
holonic components and Figure 1 Holonic manufacturing systems
their cooperations.
The holonic components of the manufacturing systems are basically divided into
two classes based on their roles in the manufacturing processes; they are,
(a) Manufacturing equipment which transforms the blank materials to the finished
products, and
(b) Workpieces which are transformed by the manufacturing equipment.
The manufacturing equipment includes all the equipment, such as machine tools,
assembly stations, tools, jigs, AGVs, and storages. Blank materials, parts, sub-
assemblies and assemblies are typical examples of the workpieces.
The manufacturing equipment and the workpieces are required to have holonic
decision rnaking functions to determine their own suitable manufacturing processes
in the manufacturing systems on the basis of their status. The followings summa-
rizes the important decision making functions of the manufacturing equipment and
the workpieces;
(a) Manufacturing equipment

1) Design and modification ofmanufacturing functions.
2) Operation planning and task planning.
3) Production scheduling.
4) Production planning and MRP (Material Requirement Program).
(b) W orkpieces
I) Modification of their shapes, dimensions and tolerances.
2) Process planning.
3) Production scheduling.
4) Production planning and MRP.
3. MODELING OF HOLONIC MANUFACTURING SYSTEMS
An object oriented modeling technique is adopted to represent the holonic compo-

nents which carry out the decision making functions for the production control of
the manufacturing systems. The individual objects have both the data representing
the status and the methods describing the decision making procedures.
Object oriented models are proposed to describe and to simulate the decision
making activities and the communication activities of the holonic components of
the manufacturing systems, based on the investigation of the manufacturing proc-
esses of the products. Two types of manufacturing systems are considered here;
they are, a manufacturing system of mechanical assemblies, and a manufacturing
system of composite parts of civil aircrafts. Schematic illustrations of these two
types ofmanufacturing systems are shown in Figs. 2 and 3, respectively.
The manufacturing system for the mechanical assemblies consists of machining

shops, assembly stations, storages and AGVs, and the manufacturing processes are
carried out by the batch processing. The objects shown in Fig. 4 are needed to
carry out the production control of the manufacturing systems. In the figure, the
nodes show the objects, and the arcs give the is_a relations and the part_of rela-
tions among the objects. The objects are basically classified into four; they are, the
workpieces, the manufacturing equipment, the manufacturing processes of the
workpieces, and the operations.
The Manufacturing system for the composite parts is basically a line type system,
however, parallel line processing and batch processing are included as shown in
Fig. 3. The objects needed to represent the model of the manufacturing system are
slightly different from the ones for the manufacturing system for the mechanical
assemblies, however, the basic components and their relationships are same as ones
in Fig. 4.
AGV Transportation System

Input •
• • • •
Storage - '-" I I I
FMC for Prismalic Parts
I I
D D D
•
,..--
0
I-
DDDDDDD Part
Storage
Assembly
Assembly Stalions
•
Shop
Material
Storage
• Machine Tools
FMC for Rotalional Parts I") ~I D11 D•I

I I
0 11
DDDDDDD
• •
Product Storage
Machine TooIs
'---
r,-
'--'"
Figure 2 Manufacturing system for mechanical assemblies
Workstation I
Manual Operations
Figure 3 Manufacturing system for composite parts
4. HOLONIC SCHEDULING SYSTEM
4.1 Decision Making Structure

The concept of the holonic manufacturing systems is applied to a real time produc-
tion scheduling systems which is an important problems in the production control.
The real time scheduling means that the schedule is determined dynamically only
when the status of the manufacturing systems is changed due to the progress of the
manufacturing processes and the unforeseen events. Therefore, the scheduling
systems only determine the schedules of the manufacturing equipment and the
workpieces for very short time period.
or art
laI ration
D 1GD
roceu
r 1
reaea ra IOD
ects and their relationships needed for production control
The scheduling systems consist of a set of holonic objects representing the work-
pieces and the manufacturing equipment, such as the machine tools, the worksta-
tions, and the jigs. The production schedule is determined based on the decision
makings of the individual holonic objects and their communications. The decisions
of the individual objects are made by applying the heuristic mies.
The procedure to determine the schedule is summarized in Fig. 5. The individual

objects modify their status, in the first step, if one of the following events occurs;
Real Manufacturing System
Figure 5 Scheduling processes
(1) an operation of a workpiecellot is finished,

(2) a workpiecellot is inputted to the manufacturing system,
(3) a equipment is broken down, or is recovered, and
(4) a status of a workpiecellot is changed from the normal one to the high priority
one.
In the second step, all the objects which are free at that time select suitable opera-
tions to be carried out in the next time period of the manufacturing systems based
on their own criteria. The time period means the period between the time when one
event occurs and one when another event occurs. The information about the select-
ed operations are transmitted to the coordinator, and the conflicts among them are
examined. If the conflicts are detected, the decisions of some objects are rejected
and changed by the coordinator. After the coordination, the operations to be carried
out in the next period of the manufacturing systems are scheduled. The procedures
above mentioned are repeated, when the events occur.
4.2 Scheduling Criteria of Components

A rule based approach is applied in the research to describe the decision making
criteria to select the operations to be carried out and to coordinate the conflicts.
The rules of individual objects are described as the methods in the objects. The
contents of the decision criteria of the objects are summarized in the followings.
(1) Lot object
Each lot object has the criteria to select a suitable manufacturing equipment which
carries out the operation of the lot in the next time period of the manufacturing
system. The basic criterion is as folIows;
• Select a manufacturing equipment which can finish the next operation of the lot
at the earliest time. Where, the finishing time of the next operation is calculated
from both the manufacturing time given in the manufacturing operation objects
and the estimated transportation time by the AGVs.
The high priority lots must be finished their operations as soon as possible, there-
fore, the objects of the high priority lots have also the criteria to reserve the manu-
facturing equipment and the AGVs needed for the future operations of the lots. The
criteria to reserve the manufacturing equipment and the AGVs are as folIows;
• Select a manufacturing equipment which can finish the operation of the lot in
the shortest time, and
• Select an AGV which can transport the lot in the shortest time.
(2) Manufacturing equipment objects

The manufacturing equipment objects have the criteria to select suitable operations
to be carried out in the next time period, when they are free at that time. The crite-
ria are summarized as folIows;
• Select a operation of the high priority lots, if the high priority lot requires the
operations which can be carried out by the manufacturing equipment, and
• Select a operation of the normal lots which can be finished in the shortest time.
(3) AGV objects

The decision criteria of the AGV objects are the rules to select suitable lots which
the AGVs transport. The criteria are given as folIows;
• Select a high priority lot, if the high priority lot requires the transportation op-
eration, and
• Select a normal lot which requires the transportation operation at the earliest
time.
(4) Coordinator object

The coordinator object coordinates the conflicts among the decisions of the lots,
the manufacturing equipment and the AGVs. The basic rules of the coordinator
object are given in the following;
• High priority is given to the operations of the high priority lots, and
• Select operations which are selected by both the lots and the manufacturing
equipment.
4.3 CASE STUDIES

A prototype of holonic real time production scheduling system has been imple-
mented in SmalltalkIVisual W orks. Some case studies have been carried out to
verify the feasibility of the holonic real time production scheduling method pro-
posed here. In particular, emphasis has been given to clarifying the adaptability of
the holonic system to the scheduling problems of the manufacturing system for the
mechanical assemblies and one for the composite parts.
The system for the mechanical assemblies shown in Fig. 2 consists of an FMC
composed of four vertical type machining centers and six turning centers, an as-
sembly shop composed of two assembly stations, and a transportation & storage
system composed of two AGVs and four storages. One lot of an assembly and the
part lots related to the assembly lot are inpuUed to the manufacturing systems for
the case study. Figure 6 shows an example of schedule deterrnined by the prototype
system. In the figure, the vertical axis indicate the manufacturing equipment and
the lots to be manufactured, and the horizontal axis shows the time. The individual
line segments indicates the operations of the individual lots and their schedules. It
can be found that the system can generate feasible schedules for the FMC, the
assembly shop, and the transportation and storage system.
The other case studies have been carried out for the scheduling of the line produc-
tion for the composite parts shown in Fig. 3. The manufacturing processes sched-
uled by the real time scheduling method are shown in Fig. 7. In the figure, the
vertical axis indicate the lots to be manufactured, and the horizontal axis shows the
time. The individual line segments indicates the operations of the individual lots
and their schedules.
Figure 6 Example of schedule of manufacturing system for mechanical assemblies

Figure 7 Example of schedule of manufacturing system for composite parts
It is shown, through the case studies, that the holonic real time scheduling methods
proposed here can generate suitable manufacturing schedules for the manufacturing
systems considered here.
5. CONCLUSIONS
A basic architecture of the holonic manufacturing systems was discussed, and an

object oriented modeling technique was proposed aiming at describing the status
and the activities of the holonic manufacturing systems. Prototypes of real time
production scheduling system were implemented based on the holonic architecture.
The following remarks are concluded.
(1) An object oriented modeling method is proposed to describe the information
processing and decision making functions of the holonic components.
(2) Objects needed for the holonic real time production scheduling system are
established, which represent the components such as the manufacturing equip-
ment, the workpiecesllots, the processes and the operations.
(3) Prototype production scheduling systems have been implemented in Small-
talk/Visual W orks and applied to some scheduling problems of the manufac-
turing system for the mechanical assemblies and one for the composite parts.
6. REFERENCES
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ICOOMS '92, pp.297-302.
Ueda, K. (1992). An Approach to Bionic Manufacturing Systems Based on DNA-
Type Information, Proc. ofthe ICOOMS '92, pp.303-308.
Moriwaki, T. and Sugimura, N. (1992).Object Oriented Modeling of Autonomous
Distributed Manufacturing System and its Application to Real Time Scheduling,
Proc. ofthe ICOOMS '92, pp.207-212.
Warnecke, H.J. (1993). The Fractal Enterprise, Springer-Verlag, New York.
Iwata, K., et al. (1994). Random Manufacturing System: A New Concept of
Manufacturing Systems for Production to Order, Annals of the CIRP, Vol. 43,
No.l, pp.379-384.
Wiendahl, H.P. and Garlichs, R. (1994) Decentral Production Scheduling of
Assembly Systems with Genetic Algorithm, Annals of the CIRP, VüIA3, No.l,
pp.389-396.
Sugimura, N., et. al. (1995). Modeling ofholonic manufacturing system and its
application to real time scheduling, Proc. ofthe 27th Int. Seminar on Manufac-
tu ring Systems, ppAOI-41O.
Wyns, J., et. al. (1996). Workstation Architecture in Holonic Manufacturing Sys-
tems, Proc. ofthe 28th Int. Seminar on Manufacturing Systems, pp.220-231.
Güu, L., et. al. (1997).Holonic Manufacturing Scheduling; Architecture,
Cooperation Mechanism, and Implementation, Proc. of IEEEIASME Int. Conf.
on Advanced Intelligent Mechatronics, pp.I-12.
Bongaerts, L. et. al. (1997), Schedule Execution in Holonic Manufacturing Sys-
tems, Proc. of the 29th CIRP Int. Seminar on Manufacturing Systems, pp.209-
214.
Arai, T., et. al. (1997). Holonic Storage: An Assembly and Storage Cell by Ma-
nipulation Using Environment, Proc. of the 29th CIRP Int. Seminar on Manu-
facturing Systems, pp.221-226.
Patankarm A. K. (1995). Enterprise Integration Modeling: A Review ofTheory
and Practice, Computer Integrated Manufacturing Systems, Butterworth-
Heinemann, pp.21-34.
ISO TC 184 (1989). Reference Model for Shop Floor Standards, ISO Technical
Report 10314.
AMICE (1992). CIMOSA Project Deliverables - Mile-stone M-2 Part 1, ESPRIT
Consortium AMICE, pp.9-1O.
Petrie, C. 1. (1992). Modeling Methodology: In Enterprise Integration Modeling,
Proc. ofthe 1st Int. Conference, MIT Press.
7. BIOGRAPHY
Nobuhiro Sugimura received B.S. and M.S. degrees in engineering from Kobe
University, Japan, in 1976 and 1978, respectively. He was a Research Associate
from 1980 to 1987, and a Associate Professor from 1987 to 1994 at Faculty of
Engineering, Kobe University. He received a ph. D degree in engineering from
Osaka University, in 1985. Since 1994, he is currently a Full Professor at College
of Engineering, Osaka Prefecture University. His research interests include,
modeling and simulation of holonic manufacturing systems, CAD/CAM and pro-
duct modeling for mechanical products, standardization of product model STEP,
and modeling and design of machine tools.
Toshimichi Moriwaki received B.S. , M.S. and ph. D degrees in engineering from
Kyoto University , Japan in 1966, 1968 and 1974 respectively. He was employed
as a research associate at Mechanical Engineering Department, Kobe University in
1968, and promoted to Associate Professor and Full Professor in 1974 and 1985
respectively. He was a research engineer/Assistant Professor at McMaster Uni-
versity, Canada in 1975 and 1976. His research interests include intelligent
manufacturing systems, intelligent machine tools, sensing technology in manufac-
turing, ultraprecision machine tools and machining process and human factors in
manufacturing.
Keiichi Hozumi received B.S. in engineering from Kobe University, Japan, in1970.
He is working in Research & Development Division of ShinMaywa Industries, Ltd.
from 1970, which company products Aircraft, Factory Automation Related Prod-
ucts, Truck Bodies & Equipment etc. in Japan. He had researched and developed
control systems, sensors for Welding-robots and AC motors until 1985. Since
1986, his research interests are simulation and scheduling for manufacturing sys-
tems. Since 1997, he is a manager of Production engineering center in his com-
pany. He received a ph. D degree in engineering from Kobe University in 1997.
37
Performance evaluation of distributed
real-time scheduling systems using
distributed production system
simulator
[tsuo Hatono, Toshikazu Nishiyama, Motohide Umano and
Hiroyuki Tamura
Graduate School 0/ Engineering Science, Osaka University
Toyonaka, Osaka 560, JAPAN
E-mail: hatono@sys.es.osaka-u.ac.jp
Abstract
This paper deals with a distributed simulation system to evaluate distributed real-
time scheduling systems. To simulate various kinds of hybrid systems of distributed
and centralized architectures, the distributed simulator in this paper consists of three
kinds of schedulers: factory level scheduler, shop level scheduler, and equipment
level scheduler. Moreover, the distributed real-time scheduling system is implemented
as a virtual production system. Finally, we show the simulation results of the dis-
tributed real-time scheduling systems to evaluate the dispatching rules and the over-
head for real-time scheduling.
Keywords
Distributed real-time scheduling, Virtual production system, Distributed simulation,
Performance evaluation
1 INTRODUCTION
Flexible manufacturing has been developed to achieve multi-volume and least lot
production. Flexible manufacturing is much more complex than the other production
systems, because:
1. There exist alternative machine tools.

2. It is necessary to generate job transfer schedules, the schedules for operators of
machine tools, and the schedules for tool supply, simultaneously.
3. There exist buffers at each machine tooI and some temporal buffers.
In flexible manufacturing, in general, products are processed according to a job

schedule obtained with off-line basis(Baker 1974). However, in flexible manufactur-

ing, we often come across the faHure of machine tools, a sudden change of produc-
tion plans, and so on. In this case, real-time scheduling(Harmonosky and Robohn
1991) is more effective than off-Iine scheduling, because it is difficuIt to obtain a
new schedule immediately in off-line scheduling. However, to develop areal-time
scheduling system, we must take the architecture of the production management
system into account, because in the real-time scheduling system, we must handle
a huge amount of data in the production system in real-time(Parunak 1990). Some
scheduling methods for such uncertain environments has been proposed (Blazewicz
et al. 1996), but the methods are not taken the implementation on the real production
systems into account.
Some architecture of next generation of production management systems are pro-
posed (Okino 1992, Ueda 1992). Each production system are based on different con-
cepts such as holonic(Okino 1992) and bionic(Ueda 1992), and so on, but almost alI
the production management system is developed as a distributed system. In such dis-
tribute production management systems, in general, there are no global management
processes, because each manufacturing facility is considered as a subsystem that is
independent of the other subsystems. Therefore, we need to a1locate the real-time
scheduling process on each subsystem without using a centralized scheduling pro-
cess. In this case we need to develop cooperative scheduling protocols to negotiate
between the scheduling processes.
In real-time scheduling, however, it is rather difficuIt to optimize the schedule and
to estimate the performance of control computers and communication facilities the-
oretically, because the behavior of the production management systems are too com-
plex. For each next generation of production management system, some real-time
scheduling systems are proposed(Arai et al. 1996, Sugimura et al. 1996, Hatono et
al. 1994), but the proposed real-time scheduling systems has not efficiently evaluated
the performance.
In this paper, to develop the scheduling algorithms and protocols that are suitable
to the production management systems, we evaluate the algorithms and protocols by
computer simulations. However, it is difficult to develop the simulation system to
verify and to evaluate the protocols by using conventional discrete events simulation
technique, because it is too complex to develop the simulation model of the real-time
scheduling system. To cope the difficuIty, we developed a distributed simulation sys-
tems to evaluate areal-time scheduling system. The simulation system proposed
in this paper can simulate the real-time scheduling system on not only a perfectly
distributed production management systems but also hierarchical ones. Since we de-
veloped the simulation system as a virtual production system, we can simulate the
detail behavior.of the scheduling a1gorithms and protocols.
In this paper, first, we describe abrief introduction of distributed manufacturing
systems and distributed real-time scheduling. Next, we describe a distributed simu-
lation system to evaluate distributed real-time scheduling systems. Finally, we show
the simulation resuIts of the distributed real-time scheduling systems.
Performance evaluation of distributed real-time scheduling systems 425
2 DISTRffiUTED MANUFACTURING SYSTEM
In flexible manufacturing, since the production environment varies dynamically, the

production management system must have functions to deal with failures of compo-
nents, and reconfiguration or expansion of production facilities. To cope with these
difficulties, it seems that it is more effective to construct a manufacturing system as
a distributed system. In the centralized production system, the whole production sys-
tem will stop, if the host epu breaks down. However, in the distributed production
system, the whole system will not stop, even if some components break down. In
this paper, the production management system is assumed to be distributed to each
component such as machining center, AGV and so on.
However, in many cases, the distributed production systems is not practical, be-
cause communication traffic between each scheduling process is too large if the num-
ber of machine tools in the production system is large. In those cases, the manufactur-
ing systems are often constructed as hierarchical distributed systems. In this paper,
we evaluate the performance of the real-time scheduling systems on not only the
distributed production management systems but also the hierarchical ones.
3 DISTRffiUTED REAL-TIME SCHEDULING SYSTEM
To generate a schedule in real-time, it is necessary to resolve three kinds of conflicts

as follows:
1. Selections of alternative machine tools (This is called routing of job),

2. Job selections for transporting,
3. Job selections from an input buffer.
In the distributed real-time scheduling system, these conflicts are resolved locally in
the scheduling processes concerned with the conflicts. In this paper, we assurne the
following conditions:
1. In the distributed real-time scheduling system, we consider each machine tool as

a subsystem. A scheduling process in each subsystem resolves the above conflicts
locally.
2. Each scheduling process has only local information concerned with the machine
tool managed by the scheduling process. By using communication facilities, the
scheduling process can obtain the status of the other machine tools, and the wh oIe
system.
3. In flexible manufacturing, in general, it is difficult to manage the information con-
cerned with each job, such as processing information, due dates, and so on, when
the number of jobs to be processed becomes large. In this paper, the information
is recorded in "tag," which is attached to each job. The information is read by
each scheduling process and is used to resolve conflicts.
In this paper, the information contained in tags consists of name of job, number of lot,
processing information of jobs, history of processing, due date, sum of processing
time up to the current time, processing start time, and degree of importance of due
dates.
4 DISTRffiUTED PRODUCTION SYSTEM SIMULATOR
In this paper, the distributed production system simulator is designed based on the
policies as folIows:
1. We develop the each simulation program of the real-time scheduling on each ma-
chine tool as a process that is independent of the other processes. Therefore, it is
not necessary to execute each simulation program on a computer.
2. Each simulation pro gram can obtain the information for simulation of each ma-
chine tool and scheduling from the other simulation programs by inter-process
communication.
3. We can simulate not only the distributed real-time simulation system but also the
hierarchical ones.
To simulate various kinds of hybrid systems of distributed and centralized archi-

tectures, the distributed simulator in this paper consists of three kinds of schedulers:
(1) factory level scheduler, (2) shop level scheduler, and (3) equipment level sched-
uler. In the followings, we describe the functions of each scheduler.
4.1 Factory level scheduler
We assumed that the factory level scheduler controls the whole production system.
Therefore, there is only one factory level scheduler in the production system. In this
paper, the factory level scheduler consists of the two kinds of schedulers as folIows:
Factory level job scheduler

A factory level job scheduler controls the ftows of jobs between the shops using the
global information such as status of input and output buffers of each shop, utilization
of each production equipment, and so on. When the factory level scheduler receives
a scheduling requirement of a job from a shop level scheduler or a human manager
of this factory, the factory level scheduler selects a shop for the next operation of the
job, and returns the scheduling results the shop level scheduler or the manager for
the scheduling requirement.
Factory level AGV scheduler

The factory level AGV scheduler controls the AGV s that convey jobs between the
shops. The factory level AGV scheduler selects the alternative AGV to reduce the
Factory level scheduler
Shop level Scheduler
Figure 1 Overview of communications for scheduling in a factory level scheduler.
waiting times of jobs just after the selection of a shop for the next operation. Figure 1
shows the overview of communications for scheduling in a factory level scheduler.
4.2 Shop level scheduler
A shop level scheduler controls the flows of jobs in a shop, and controls the AGVs
which convey jobs between the equipments based on the local information obtained
in the shop. Furthermore, the shop level scheduler controls the flows of jobs among
shops using contract net based cooperative scheduling algorithms(Hatono et al. 1994).
In this case, it is not necessary to develop the factory level scheduler. The shop level
scheduler consists of three scheduling modules as folIows:
Shop level cooperative scheduler

A cooperative scheduler has scheduling functions as folIows:
• The cooperative scheduler receives the processing requirement from the other
scheduler such as the factory level scheduler and shop level schedulers, and send
the scheduling requirement to the shop level job scheduler.
• The cooperative scheduler selects a shop for the next operation of jobs using the
cooperative scheduling algorithm, if there exists no factory level scheduler.
• The cooperative scheduler generates the schedules for recovering from machine
breakdowns and the emergency jobs.
Shop level job scheduler

A shop scheduler resolves the three kinds of conflicts in the shop: selections of al-
ternative machine tool, job selections for conveying, and job selection from an input
buffer of each machine tool in the shop. In this simulator, the appropriate dispatching
rules are used to resolve the conflicts.
Shop level schedulers or

factory level scheduler
Cooperative
scheduling protocoV
Scheduling requirement
Shop level scheduler
II
Figure 2 Overview of communications for scheduling in a shop level scheduler.
Shop level AGV controller

The shop level AGV controller controls the AGV s that convey jobs between the
equipments. The shop level AGV scheduler selects the alternative AGV to reduce
the waiting times of jobs just after the selection of the equipment for the next opera-
tion. Figure 2 shows the overview of communication for scheduling in a shop level
scheduler.
4.3 Equipment level scheduler
A equipment level scheduler generates the processing orders of jobs in the input
buffer. Furthermore, the equipment level scheduler requires the shop level scheduler
to select the equipment of the next operation of each job.
We can develop the various kinds of hybrid systems of distributed and centralized
architecture by omitting the appropriate level schedulers. Figure 3(a)"'(d) shows the
examples of hybrid real-time scheduling systems.
5 NUMERICAL EXAMPLES
In this paper, we apply the distributed simulator to real-time scheduling systems

which have the architecture shown in Figure 3 (a)",(d). Consider that the production
system consists of 5 shops, each of wh ich consists of 3 machine tooIs. In this pro-
duction system, we assume that 10 kinds of jobs are processed and the number of
processes of each job and the number of each job are 30 and 3, respectively.
Performance evaluation 0/ distributed real-time scheduling systems 429
SS: Shop scheduler ES: Equipment scheduler
(a) Centralized real-time scheduling system.
(b) Hierarchical Real-time scheduling system which consists of factory,

shop, and equipment level schedulers.
(c) Distributed real-time scheduling system which consists of shop and equipment
level schedulers.
.. ., . .. . --1--.
SS-I SS·2 SS·3 SS-4 SS·12 SS·13 SS-14 SS-IS
.. .,,... ._.,,.. ... .,-- ...... ._""_ .. --,--
,,
...... ••• ,
ES-I ES-2 ES-3 ES-4 ES-12 ES-13 ES-14 ES-IS
(d) Distributed real-time scheduling system which consists of shop and

equipment level schedulers, which each shop level controller manages
only one equipment level scheduler.
Figure 3 Examples of hybrid real-time scheduling system.
5.1 Evaluation of scheduling methods
In this numerical examples, we use the dispatching rules for selecting shop as fol-
lows:
• Dispatching rules for selecting an alternative shop:
Rule S-1: Select an alternative shop that contains the machine tool in which pro-
cessing time of next operation of the job is shortest.
Rule S-2: Select an alternative shop that contains the machine tool in which the
next operation of the job can be processed.
Table I Dispatching rules and evaluation functions in numerical examples.
Real-time Dispatching rule Evaluation

scheduling for selecting function for
system ashop a madilne tool aJo6 contract net
(a) M-l~M-3 D-l~D-3
(b) S-l, S-2 M-l~M-3 D-l~D-3
(c) M-l~M-3 D-l~D-3 F-2, F-3

(d) D-l~D-3 F-2, F-3
• Dispatching rules for selecting an alternative machine tool:
Rule M-I: Select an alternative machine tool that has least number of jobs in
input buffer.
Rule M-2: Select an alternative machine tool that contains the machine tool whose
utilization is least.
Rule M-3: Select an alternative machine tool that contains the machine tool in
which processing time of next operation of the job is shortest.
• Dispatching rules for selecting a job in i~put buffer:
Rule D-I: Shortest Processing Time (SPT)

Rule D-2: First Come First Serve (FCFS)
Rule D-3: Due Date (DDT)
• Evaluation functions for the contract net based cooperative scheduling protocols
(Hatono et al. 1994):
Function F -I: Estimated shortest processing time of jobs

Function F -2: Number of jobs in a shop
Function F -3: Sum of processing times of jobs in machine tools that are avail-
able for the next processes of the jobs
Table I shows the rules and the evaluation functions that are used in the real-time
scheduling systems shown in Figure 3 (a)rv(d)
Figure 4 (i)rv(iv) and Figure 5 (i)rv(iv) show the average of utilization of machine
tools and the average of makespan of each job in the real-time scheduling systems
shown in Figure 3 (a)rv(d), respectively. In these simulation results, the average uti-
lization and waiting time in real-times scheduling system (a) are better than those in
the other systems. This is because all the information for scheduling can be used in
Peiformance evaluation of distributed real-time scheduling systems 431
100 100
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Dispalching role DiSpalChiDg roJe
(i) Real-time scheduling system (a) (ii) Real-time scheduling system (b)
100
t 90 t
100
] ] 90
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:a 80 ] 80
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70
60
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0
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70
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s"kW" '1cW' ''kR'''' '''kW'' '''kW'''''kW'' SPT fCFS DDT SPT fCFS DDT
f.2. M-1 f..1.W.l F-2.M-l ~3.M-1 F-l, M-2 F-J.M-l F·I F·2
Dispatching rule I Evaluation function Dispalcrung rulc I Evaluation funetion
(iii) Real-time scheduling system (c) (vi) Real-time scheduling system (d)
Figure 4 Average utilization of machine tools
real-time scheduling system (a). However, the difference of the average utilization
and makespan between real-time scheduling system (a) and (b) is relatively smalI.
Therefore, we can guess that it is much more important to select appropriate dis-
patching roles in distributed real-time scheduling systems than that in centralized
real-time scheduling systems.
Moreover, in the numerical experiments, DDT and SPT roles are effective for
improvement of makespan of jobs, and FCFS role is effective for improvement of
utilization of machine tools. In distributed real-time scheduling system shown in
Figure 3 (b) and (d), evaluation function F-2 is effective for improvement of both
utilization of machine tools and makespan of jobs.
5.2 Performance evaluation of communication facilities and computers
Figure 6 shows the average number of operation on machine tool in every 20 time
units when the number machine tools are varied. In Figure 6, real-time scheduling
system (a), which is developed as a centralized system, the number of operation
i 1000 , . . - - - - - -- - - -- - - - - ,
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1
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900
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M- I M-2 M-3
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(i) Real-time scheduling system (a) (ii) Real-time scheduling system (b)
-::::- 1000 -::::- 1000
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DispoIChing ru.k: I Evaluation fUIIClion Di,polCbing role I Evaluation runction
(iii) Real-time scheduling system (c) (vi) Real-time scheduling system (d)
Figure 5 Average makespan of jobs.
2000
1800
.'!l
'2
e"
,:;)
1600
~ 1400
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c
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8.-
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",'
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400
...... Real-time scheduling s~m (d)
200 6 ------------------
10
-------------------
12 14 16 18
Number of machine 10015
Figure 6 Average number of operations on machine tools in every 20 time units.

increases in proportion to the increase of the number of machine tools. However,

in real-time scheduling system (d), which is developed as a distributed system, the
number of operation is not varied when the number of machine tools increase. There-
fore, the overhead for scheduling in real-time scheduling system (d) is the least in
the real-time scheduling system (a)rv(d). We can estimate that the performance of
the computer of the factory level scheduler in real-time scheduling system (a) must
be 10 times as much as that of real-time scheduling system (d).
6 CONCLUSION
In this paper, we develop a distributed simulation system to evaluate distributed

real-time scheduling systems. The distributed real-time scheduling system is imple-
mented as a virtual production system. Moreover, to simulate various kinds ofhybrid
systems of distributed and centralized architectures, the distributed simulator in this
paper can simulate the real-time scheduling system which consists of three kinds of
schedulers: factory level scheduler, shop level scheduler, and equipment level sched-
uler.
Finally, we show the simulation results of the distributed real-time scheduling sys-
tems to evaluate the dispatching rules for scheduling and the overhead for scheduling
in each scheduler. Further research might be focused on the efficiency of the simula-
tor by applying a larger scale production systems and development of the graphical
user interface of the simulator.
7 REFERENCES
Arai, E., L. Jihong and S. Amnuay (1996). Distributed production system to real-
ize flexible scheduling. In: Proceedings 0/ Japan/USA Symposium on Flexible
Automation. Boston. pp. 1365-1372.
Baker, K.R. (1974). Introduction to Sequencing and Scheduling. John Wiley and
Sons. New York.
Blazewicz, J., K.H. Ecker, E. Pesch, G. Schmidt and J. Weglarz (1996). Scheduling
Computer and Manu/acturing Processes. Springer-Verlarg.
Harmonosky, C.M. and S.F. Robohn (1991). Real-time scheduling in computer inte-
grated manufacturing: Review of recent research. International Journal 0/ Com-
puter lntegrated Manujacturing 4(6), pp. 331-340.
Hatono, 1., K. Tachibana, M. Umano and H. Tamura (1994). Distributed real-time
scheduling for flexible manufacturing.ln: Proceedings 0/ JAPAN-U.S.A. Sympo-
sium on Flexible Automation - A Pacific Rim Con/erence -. Kobe. pp. 803-810.
Okino, N. (1992). A prototyping ofbionic manufacturing system. In: Proceedings 0/
the ICOOMS '92. pp. 297-302.
Parunak, H.V.D. (1990). Distributed AI and manufacturing control: Some isuues and
insights. In: Decentralized A.l. (Y. Demazeau et al., Eds.). pp. 81-101. North-
Holland. Amsterdam.
Sugimura, N., M. Hiroi, T. Moriwaki and K. Hozumi (1996). A study on holonic

scheduling for manufacturing system of composite parts. In: Proceedings 0/
Japan/USA Symposium on Flexible Automation. Boston. pp. 1407-1410.
Ueda, K. (1992). An approach to bionic manufacturing systems based on DNC-Type
information. In: Proceedings o/the ICOOMS '92. pp. 303-308.
8 BIOGRAPHY
Itsuo Hatono received the B.S. and M.S. degrees in engineering from Osaka Uni-
versity, Osaka, Japan, in 1984 and 1986, respectively, and the Ph.D. degree in en-
gineering from Osaka University in 1994. Currently, he is an assistant professor of
Department of Systems and Human Science, Graduate School of Engineering Sci-
ences, Osaka University. His research interests include production scheduling for
complex and large production systems, and modeling of discrete event systems such
as manufacturing systems and computer networks.
Toshikazu Nishiyama received B.S. and M.S. degrees in engineering from Osaka
University, Osaka, Japan, in 1994 and 1996, respectively. Currently, he is a research
Engineer of Matsushita Electric Industrial Co., Osaka Japan. His research interests
in Osaka University included the development of real-time scheduling systems and
distributed production system simulators.
Motohide Umano received the B.S. degree in 1974, the M.S. degree in 1976 and
the Dr. of Engineering degree in 1979 in Information and Computer Sciences from
Osaka University, Japan. Currently, he is a professor of Department of Mathematics
and Information Sciences, College of Integrated Art and Sciences, Osaka Prefecture
University. His current research interests include fuzzy-set oriented programming
languages, fuzzy databases, fuzzy expert systems and fuzzy knowledge information
processing.
Hiroyuki Tamura received the B.S. and M.S. degrees in engineering from Osaka Uni-
versity, Osaka, Japan, in 1962 and 1964, respectively, the M.S. degree in Engineering-
Economic Systems from Stanford University, Stanford, California, U.S.A., in 1968,
and the Ph.D. degree in engineering from Osaka University in 1971. Currently, he
is a professor of Department of Systems and Human Science, Graduate School of
Engineering Science, Osaka University. His research interests center on the systems
methodology for large-scale systems such as modeling, control and decision making,
and its applications to manufacturing systems and public systems.
38
Genetic algorithm approach
to multi-objective scheduling
problem in plastics forming
plant
Hisashi Tamaki
Dept. 0/ Electrical and Electronics Engr., Kobe University
Rokkodai, Nada-ku, Kobe 657, JAPAN
Tel: +81-78-809-1069 Fax: +81-78-809-1069
E-mail: tamaki@eedept.kobe-u.ac.jp
Tomohiro Mukai, Kenji Kawakami, and Mituhiko Araki
Dept. 0/ Electrical Engineering, Kyoto University
Yoshida-honmachi, Sakyo-ku, Kyoto 606-01, JAPAN
Abstract
In this paper, a method of applying genetic algorithms (GAs) to multi-
objective scheduling problems is proposed. The key points are (1) an alpha-
betical representation (i.e., genotype) of feasible schedules (Le., phenotype),
and (2) a reproduction operator of GAs which combines the parallel selection
with the Pareto reservation strategy. In the paper, through computational
experiments, it is shown that not only one of the Pareto-optimal schedules of
a problem but a set of such solutions can be obtained by a single run of the
proposed method.
Keywords
Production scheduling, Multi-objective optimization, Plastics for~ing plant,
Genetic algorithm, Pareto-optimal solution.
1. INTRODUCTION
This paper deals with a multi-objective scheduling problem in plastics form-

ing plant. This problem basically belongs to the dass of unrelated parallel
machine problems, but indudes multiple performance indexes (Le., objective
functions) as weH as several restrictions which originate from the necessity to
Advances in Production Management Systems N. Okino, H. Tamura & S. Fujü (Eds.)

use auxiliary equipments such as "dies." Thus, it can be regarded as a rep-

resentative example of "complex" scheduling problems arising in industries.
Motivation of research is to establish a computer technique which can replace
01' support experienced engineers who are actually making daily schedules for
the plant.
As for solution of practical scheduling problems in general, most of meth-
ods proposed in the past researches use some sort of dispatching rules, and
researchers' efforts have been concentrated upon clarifying "which rules fit
wh ich problems." We have presented a new scope for the study of the practi-
cal scheduling problems by proposing a method to solve them without relying
upon dispatching rules (Tamaki et al., 1993; Tamaki et al., 1995a). Namely,
the scheduling problems in the plastics forming plant, where we consider a
weighted sum of multiple performance indexes as a single-objective function,
are transformed into the mathematical programming problem, and feasible
schedules are represented by strings. This formulation enables us to use the
meta-heuristics (Reeves, 1993) such as simulated annealing and genetic algo-
rithms (Goldberg, 1989), which are known to be effective for other sorts of
combinatorial optimization problems.
In this paper, we deal with the multiple objective functions a.c; they are, and
extend the way of applying genetic algorithms to the single-objective problems
by using the reproduction operator proposed so far (Tamaki et al., 1995b).
This approach enables us to generate not only one of the Pareto optimal
schedules (i.e., non-dominated schedules) of the problem but a set of such
schedules. Through computational experiments, we show the effectiveness of
the proposed approach is shown.
2. SCHEDULING PROBLEM IN PLASTICS FORMING

PLANT
Several kinds of pipes are produced in the plastics forming plant. There exist
several forming machines and several dies. A "lot" of pipes (of a kind) are
produced by using a machine equipped with a die. The type of die (we call
"die-type") determines the kind of production (i.e., diameter and thickness
of pipes), and the combination of the machine and the die-type determines
production speed. In Fig. 1, the case of 4 machines and 4 die-types is picttlred
in order to give a global idea of the problem, whereas our practical plant have
more (e.g., 10"" 20) machines and die-types.
The total number of lots (we call "jobs") to be produced in a pre-assigned
period is prescribed together with the type of production and the quantities
of pipes of each lot. Here, the scheduling problem is defined to find a schedule
(i.e., the assignment of jobs to machines and the processing order of jobs on
each machine) which minimize several objective functions (e.g., the maximum
completion time, the maximum tardiness, the total idle time, etc.).
Genetic algorithm approach to multi-objective scheduling problem 437
Figure 1 Plastics forming plant with 4 machines and 4 die-types. The

symbol 'M', 'P', 'J' represent a machine, a die-type and ajob,
respectively.
Evaluation 1~
! !! t
Solution Space
(Schedules)
\
I Translation I
/ /
~~:)-\:~ \..,Q...9.j .......... (Alphabetical Strings)
~~.!~~..~~~~~J......................................................................................................~
Figure 2 Search space and solution space. The translation part pro-
duces a feasible schedule from an arbitrarily given alphabetical
string.
r;;-~;;;;;~ / ~:. ~~!]

~~__J~~~_~.__~~~J ~ M g,;~~~=j~0
3:
M 4 : L~~
(a) Determining the machine for each job - {aj}
,--------------------Time
(b) Determining the sequence of jobs

on each machine - {ßj}
(c) Determining the sequence of jobs

which uses the same die - {--yj}
Figure 3 Outline of the procedure to translate an alphabetical string

into a schedule. Aset-up time is indicated by a black rectangle.
3. GENETIC ALGORITHM APPROACH
In order to apply the meta-heuristics such as genetic algorithms (GAs) to the

problem, it is required that feasible schedules are represented symbolically
(e.g., as binary strings). The simple way to represent a schedule S by a bi-
nary string B is to use the linear array obtained by lining up the 0-1 variables
of the IP problem in a certain order (Tamaki et al., 1993). This method seems
not to include any problem when we only look at the process of determining B
from S. However, if we look at the reverse process, we immediately face with
the problem that almost all strings correspond to infeasible schedules. This
t-tb generation (t+ 1)-th generation

[··································1
('")
Cl
'"
'"
o
<
(11
------. Population I - ~ - - r-----.. Population -----~
3::
S
I
r::.
g
I
I
•i···i•
::: =====:::=====:tt Ilajl :,: :j:l') I,

: : I I I
Fitness , i I
........................................................)
Figure 4 Outline of the genetic algorithm approach to the multi-

objective scheduling problem.
problem causes serious inefficiencies in the application of the meta-heurist.ics

that the search can be proceeded by one step only after an extremely large
repet.ition of producing new strings. So, we have proposed a method to pro-
duce a feasible schedule from an arbitrarily given binary string of a sufficient
length (Tamaki et al., 1993). Moreover, we have proposed a way of improving
a search by adopting an alphabetical representation (Tamaki et al., 1995a).
That is, a schedule is represented by an alphabetical string A = (0:, ß, 1'),
where
0: j : the index of machine to which J j is assigned,

ßj: the priority used to fix both the order of jobs
on each machine and the order of jobs using
each die,
I'j: the index of die used for processing J j 1.
Using this representation, the actual search space by the meta-heuristics is

reduced as compared with the case of using the binary representation (Fig. 2),
and then, the efficiency of search can be much more improved. In Fig.3, the
1 Every die of the same type are to be distinguished (i.e., thc R-th die of type k is
represented by P ki)'
outline of translating an alphabetical string into a schedule is shown schemat-

ically.
In the case of considering multiple objective functions, it is necessary that
the operations (especially, the reproduction operation) of the conventional
GAs should be extended in order to generate not a single solution but vari-
ous solutions in the Pareto optimal set. So far, several ways of designing the
reproduction operator have been proposed for multi-objective function opti-
mization problems (Fonseca and Fleming, 1995; Tamaki et al., 1996), In this
paper, we adopt the Pareto reservation strategy (Tamaki et al., 1996):
(a) Non-dominated individuals (i.e., schedules) in a population at each gen-
eration are all reserved in the next generation.
(b) If the number of non-dominated individuals are less than the popula-
tion size, the rest of the population in the next generation are filled by
adopting the parallel selection method, i.e., the selectionjreproduction
is performed in parallel according to each objective function.
(c) Oppositely, if the number of such individuals exceeds the population

size, individuals in the next generation are selected among the non-
dominated individuals by applying a fitness sharing technique.
In Fig.4, the outline of our GA approach to the multi-objective scheduling
problems in the plastics forming plant is shown.
4. COMPUTATIONAL EXAMPLES
An example of the multi-objective scheduling problem in the plastics forming

plant with 40 jobs, 10 machines and 13 die-types have been solved, where
(a) I sum : the sum of the idle time of every machines,
(b) T max : the maximum tardiness of jobs, and
(c) C max : the maximum completion time of jobs (i.e., a makespan)
are considered as the objective functions. In applying GAs, the alphabeti-

cal representation of schedules are adopted, and the following three kinds of
genetic operators are implemented:
(a) Pareto reservation strategy with parallel selection (described in 3.),
(b ) Uniform crossover, and
(c) One-alphabet-exchange mutation.

Table 1 Setting of GA parameters
Population size : 200

Number of Generations: 300
Crossover Rate : 0.6
Mutation Rate: 0.015 / string
The setting of GA parameters is shown in Table 1.

In Fig. 5, the objective function values of obtained schedules in the 20th,
the 100th and the final (i.e., 300th) generations are shown. We can observe,
from Fig. 5, that a variety of the Pareto-optimal schedules have been obtained
by the proposed approach.
5. CONCLUSION
In this paper, a method of applying genetic algorithms (GAs) to multi-

objective scheduling problems in plastics forming plant is proposed, with
respect mainly to selection/reproduction operation which are essential for
generating a variety of Pareto-optimal schedules. Through several examples
of practical size, the usefulness of the proposed method is confirmed.
In general, in multi-objective optimization by GAs, however, it is impor-
tant to make the crossover operator efficient. If the population is distributed
widely near the Pareto-optimal set, crossover operation with random paring
may not yield good search points.
Further, for the multi-objective scheduling, to obtain the Pareto-optimal
set is not its goal but the first step of the goal. It is needed, for example, to
build adecision support system based on the approach shown in this paper.
Finally, this research was supported by the Grant-in-Aid for Scientific
Research on the Priority Area "System Theory of Function Emergence" from
the Ministry of Education, Science, Sports and Culture of Japan.
6. REFERENCES
Fonseca, C. M. and Fleming, P. J. (1995), An overview of evolutionary algo-
rithms in multiobjective optimization, Etlolutionary Computation, 3 (1),
pp. 1-16, MIT press.
Goldberg, D. E. (1989), Genetic Algorithms in Search, Optimization and
Machine Learning, Addison-Wesley.
Figure 5 Results of computational experiments. The symbols x, +, and

o indicate the schedule at the 20th, the lOOth, and the final
generations, respectively. Moreover, the symbol. indicates
the Pareto-optimal schedule at the final generation.
Reeves, C_ R. (1993), Modern Heuristic Techniques for Combinatorial Prob-

lems, Blackwell Scientific.
Tamaki, H., Hasegawa, Y., Kozasa, J. and Araki, M. (1993), Scheduling in
Plastics Forming Plant: A Binary Representation Approach, Proc. of
the 32nd IEEE Conf. on Decision and Control, pp. 3845-3850.
Tamaki, H., Taguchi, K. and Araki, M. (1995a), Application of Meta-Heu-
ristics to Scheduling Problems in Plastics Forming Plant, Proc. of the
7th IFAC/IFORS/IMACS Symp. on Large Scale Systems, pp. 409-414.
Tamaki, H., Mori, M., and Araki, M. (1995b), Generation of a Set of Pareto-
Optimal Solutions by Genetic Algorithms, Trans. of the Society of In-
strument and Control, 31 (8), pp. 1185-1192 (in Japanese).
Tamaki, H., Kita, H. and Kobayashi, S. (1996), Multi-Objective Optimiza-
tion by Genetic Algorithms: A Review, Proc. of the 1996 IEEE Int.
Conf. on Evolutionary Computation, pp. 517-522.
7. BIOGRAPHY
Hisashi Tamaki received the B.E., M.E., and Ph.D. degrees, all in electrical en-
gineering, from Kyoto University, Japan, in 1985, 1987 and 1993, respectively.
From 1990, he was a Research Associate with the Department of Electrical
Engineering, Kyoto University. Since 1995, he has been with the Depart-
me nt of Electrical and Electronics Engineering, Kobe University, where he is
currently a Lecturer. His research interests are in modeling & solutions of
scheduling problems and the theory and applications of evolutionary compu-
tat ion techniques.
Tomohiro Mukai received the B.E. degrees in electrical engineering, from Ky-
oto University, Japan, in 1996. Currently, he is a graduate student with
Graduate School of Information Science, Nara Institute of Science and Tech-
nology.
Kenji Kawakami received the B.E. and M.E. degrees in electrical engineering,
from Kyoto University, Japan, in 1995 and 1997, respectively. Currently, he
is a Research Engineer with Japan Telecom Co., Ltd.
Mituhiko Araki was born on September 25, 1943. He received the B.E., M.E.,
and Ph.D. degrees, all in electronic engineering, from Kyoto University, Japan,
in 1966, 1968, and 1971, respectively. Since 1971, he has been with the
Department of Electrical Engineering, Kyoto University, where he is currently
a Professor. His research interests are in digital control, stability theory, large-
scale systems, nonlinear systems, PID controllers, scheduling problems, and
their applications to the electric power systems, the iron & steel industries,
and the medieal problems. He is currently an Associate Editor of the IEEE
'fransactions on Automatie Control and that of Systems and Control Letters.
39
A synthesized chart for
scheduling of production
systems with automated guided
vehicle
Hideaki Hase and Norio Okino
School 0/ Engineering, The University 0/ Shiga Pre/ecture
Hikone, Shiga 522, JAPAN
Tel: +81-749-28-8394 Fax: +81-749-28-8597
E-mail: hase@mech.usp.ac.jp
Abstract
In this paper, an effeetive use of Geometrie Gantt Chart (GGC) is proposed
where GGC is a synthesized ehart of Gantt ehart on job-shop proeess and
operation diagram on Automated Guided Vehicle (AGV) which was proposed
by one of the authors. The method proposed here is: (1) planning sueeessively
the Iod of the vehicles and the jobs, (2) evaluating and improving the earriage
efficieney of the vehicles and (3) repeating these proeess. It is eonfirmed that
the proposed method is effeetive for produetion systems with AGV to make
the time required shorter than the eonventional ways.
Keywords
Produetion Seheduling, Automated Guided Vehicle (AGV), Gantt Chart, Ge-
ometrie Gantt Chart (GGC)
1 INTRODUCTION
Lately, Automated Guided Vehicle (AGV) systems have eome into use in
many produetion faetories to transport parts and produets. Requirements of
products beeame so various that job-shop proeess got introdueed into faetories
more and more. Job-shop proeess is virtually unable to be managed without
AGV system.
A lot of researehes on produetion seheduling have been made (Adelsberger
& Conen 1995; Kurbel & Ruppel 1995) and their outeome is applied also in
the faetories using AGV. These researehes, however, rarely eonsider the trans-
portation of AGV system. Though there are a lot of researches on operation
seheduling for AGV itself (Blazewicz, et al. 1993; Kwok & Norrie 1992), most
of them set their problem with random ealls.
On the scenes of AGV operation in factories, its scheduling is quite a difficult

problem and becomes more and more important as pervading of AGV systems.
Nowadays in most factories, AGV is operated in a simple way, i. e., they are
triggered by the calls from jobs which have finished there tasks on machines.
In this case, on condition that moving time of AGV is not much less than
task time, the jobs spend much idle time because of the lack of insight and of
unnecessary waits. Such waste is caused by temporal impassability on single-
truck, by capacity of vehicle itself, by constraint due to accompanying loads
and so on. The latter two rely on the number of vehicles.
On the other hand, Gantt chart is utilized for production scheduling. This
chart that has machine axis and time axis aids intuitive comprehension of
schedule on jobs and insight into improvements. Gantt ehart is sometimes
extended to include notations of various eonstraints to exhibit the advantages.
It is expected that to express eonstraints due to AGV system in this kind of
ehart is effective for scheduling of production systems with AGV. However,
there was not any precedent proposal for such chart probably beeause the
eonstraints were too complex to write down with the scheduling ehart.
One of the authors showed an idea of a notation to do this ealled Geometrie
Gantt Chart (GGC), i. e., achart which consists of a simple map of the plant
and time axis which are orthogonal (Okino 1995). It was the first stage. In this
paper, as the seeond stage, an effective utilization of GGC and its effectiveness
are diseussed. The following two subjects are eontained:
• effeetive use of the seheduling by GGC,

• verifieation of the effectiveness of the scheduling by GGC.
2 GEOMETRIC GANTT CHART (GGC)
2.1 The Idea of GGC
GGC is made by setting up time axes to show work time sehedule of every
machine on the geometrical map of a plant, perpendicular to positions where
machines are located respectively. AGV's scheduling panels are also stood up
on the guide way along the time axes (Okino 1995). Figure 1 illustrates GGC
for an example of a simple plant with 10 machines and 3 vehicles. Schedule
bars along the time axes and driving graphs on AGV's sehedule panels show
a mixed sehedule for all jobs, machines and vehicles.
As an example in Figure 1, sehedules on maehines of job P are expressed
on time axes passing maehines A, Band C as task Pi(i = 1,2,·· .). tspiX and
t fpiX means the starting time and the finishing time of task i of job P on
machine X, respectively. The solid line in Figure 1 is the locus of AGV 1 and
the broken line is that of job P. The duplicated segment of them from machine
A to maehine B represents that AGV 1 is transporting the load of job P. Any
A synthesized chart for scheduling of production systems 447
AGV's time axes lor

sehedule panels sehedule bars
loeus 01
a vehicle
t fp2
I
t (pi
maehines
Figure 1 An Example of Geometrical Gantt Chart (GGC)
locus of a job between machines must accompany a vehicle. Since a crossing

of the loci of two vehicles means a collision of them, it has to be evaded.
2.2 An Effective Scheduling by GGC
A human scheduler coordinates GGC with the geometrie map of the plant
and time axes. He sets every job and every vehicle at the initial time of the
map. Then he makes a temporal plan for each vehicle when to carry its job
and which job to carry to its destination. He also writes down expenditures
of time of the jobs at work or at wait at their destinations.
On scheduling, the human scheduler will encounter many alternatives. It is

essential to choose the appropriate alternative so that the schedule becomes
dose to the optimal solution. Accumulation of scheduling by GGC gave so me
experimental knowledge on effective course of the choices:
• Make carriage efficiency of AGV as high as possible.

• Choose the job which has more work time remained induding ideal carriage
time, i. e., whose task will be finished earlier than the other jobs when
chosen. But the former course has the priority.
Ideal here means that it is assumed that no other job exists.

The former course is more significant. The scheduler can estimate the local
carriage efficiency from extra time such as terms of emptiness of the vehide,
of stoppage and of escape from others. It improves the temporal plan to re-
schedule so as to increase its carriage efficiency on or after scheduling.
3 EFFECTIVENESS OF GEOMETRIC GANTT CHART
In this section, the effectiveness of GGC for scheduling is verified by means of

comparing it to the conventional ways. The comparison is made by applying
them to some concrete job-shop scheduling problems with AGV transporta-
tion.
3.1 Examples of Scheduling Problems for Comparison
It is necessary to show examples in this paper before verifying its effectiveness.

The examples here are some requests of 5 jobs to be proceeded on 5 machines
linked to each other with AGV guide ways. They are shown in Table 1. Two
patterns of guide network as in Figure 2 are taken up: one has a linear trunk
and the other a loop.
Each system has 2 vehicles. The vehicles need 1 unit time to pass every link
of the guide network. In all of the examples, at the initial time all vehicles are
at the pool node and all loads of jobs are at the input node. Each job must
co me to output node after finishing all of its tasks.
The following constraints are assumed:
• All links are single-truck. No vehicle is able to pass another vehicle.

• No vehicle is allowed to be in the place where other vehicles can reach in 1
unit time.
• The vehicles are allowed either to stop or to turn back only at nodes.
• Each vehide has a capacity of only 1 job load.
• Each machine is able to stock as many as it is required.
A synthesized chartfor scheduling ofproduction systems 449
Table 1 Examples of Job Table
request job machine/work time

No. task i task 2 task 3 task 4 task 5
p A/2 B/7 C/8 D/7 E/2
Q B/6 D/2 E/7 C/7 A/3
1 R E/8 C/6 A/7 D/3 B/2
S D/8 B/3 A/6 C/2 E/6
T C/3 B/8 A/8 D/6 E/3
p A/3 B/4 C/6 D/5 E/3
Q D/4 C/7 A/7 E/5 B/3
2 R E/5 A/5 B/7 D/5 C/6
S C/6 A/8 D/5 B/7 E/4
T D/8 C/4 A/7 B/7 E/6
p A/7 B/5 C/5 D/4 E/8
Q D/4 A/5 C/7 B/8 E/6
3 R E/3 C/3 B/5 D/6 A/7
S E/5 D/7 C/6 B/5 A/3
T D/3 E/5 C/6 A/5 B/4
•
E}--+-_-+--<
A
B D }--+---+-~~ A
c c B
D pattern 2
E
a AGV's pool node (8) rnachine node
• ® input node • other node
pattern 1 o output node - guide link
Figure 2 Examples of Guide Network
3.2 Comparison of Scheduling by GGC and by the Usual

Ways
Our method on the courses of choosing a job to carry explained in 2.2 is

compared here to the conventional ways.
? ...... .,
I .• ~ 50 &0
. .
pool
..
~= "- :/ -I 1. '
Y.
V:~ I '.
~
,. -
A
L :f , ~l: . .. ! .
0
B
/ 1" , "'i
: /..
~~~c
:-"""""
" / ' ..
!pu ,
,.
U- ....
.k. 0
,.. ,
.-
.J.'/ .. .... {- lJ. ;;~
oE 0
,--
-
~
0
'''''-'
ofg~w.ya
~
• tenno' " tenno!
~
(tho same ",","' ....,cl"...
- - AGV 1 ........ job P ........ Job A _._.- job T

- - AGV 2 -"-" )ob 0 _ .. _ .. lob s
Figure 3 Reduced GGC Used in This Paper
By definition, GGC has 1 more dimensions than that of its map of the plant.
Therefore, the charts for the examples of patterns mentioned above should be
solid figures . The charts made here, however, are reduced to plain ones by
cutting and expanding guide links for the problem on expression. An instance
of the reduced chart for the example of loop pattern is in Figure 3. The cut
points of the guide ways are here linked with a broken line. Since thier ends
are on the identical point, a locus on it is vertical to the time axes.
The more significant course requires information on extra time in AGV
operation, i. e., terms of emptiness of the vehicle, of stoppage and of escape
from another. GGC gives this information by the way shown in Figure 3. It
should be noted that terms in which each vehicle is at the pool before and
after its schedule are regarded as terms of stoppage.
On the other hand, the process to be compared is as foBows:
• Make Gantt chart in latest-assignment.

• Assurne that any job which finished each task on a machine caBs aB the
vehicles.
• Plan the path from the node where a vehicle has finished its previous plan
to where a job is calling it and then to the destination of the job. Choose
the job whose work time on next machine will start earliest if plural jobs
are calling it.
• Choose the vehicle which will arrive earliest where the job is waiting if
plural vehicles respond a plan to it. Abandon the plan if another vehicle
on its plan is possible to arrive there even earlier.
• Give the way of the vehicle whose load will start its next work time later
so that the both plans are expanded as little as possible if one plan crosses
another chosen plan.
These rules are selected out of some other variations on results of preparatory
schedulings under various rules of them.
Table 2 Results of Scheduling by Two Methods
request No. 1 2 3
total time of pattern 1
method using GGC 95 96 93
conventional way 107 110 112
total time of pattern 2
method using GGC 93 99 102
conventional way 112 116 117
the number of optimum 3 1 1
The results of applying the two methods to the requests in Table 1 on the
patterns in Figure 2 are compared in Table 2. The total time are defined here:
the time from the point when the first vehicle leaves the pool node to the
point when the last job arrives at the output node on condition that then an
the vehicles can return to the pool. In job-shop requests which have more than
one optimal schedule, the best total time is reported as wen as the number of
the optimums.
Table 2 shows that the total time obtained with our method is shorter than
that obtained with the conventional way though the orders of the tasks on
each machine are not optimum. This means that our method is superior to the
conventional ways even if one of the optimums is found in the conventional
way. The numbers reported as using GGC are achieved in only 2 repetitions
of processes with a few back-tracking. The solutions for the request 1 are
illustrated in Figure 4 and 5.
3.3 Consideration on Effectiveness of GGC
The results above is in favor of the proposition that scheduling by GGC is

effective. It can be argued that GGC and the course to take carriage efficiency
as an index of plans perform effectively on condition that AGV operation is
a significant factor of scheduling problem.
The purpose of GGC is to express constraints due to AGV on scheduling
space. So it is trivial that GGC brings little effect in such cases that AGV
operation is hardly inftuential on the whole schedule. In fact the examples
taken here are prepared so that one moving time is not so less than one work
time and so that the number of vehicles is just enough for the scheduling.
On this condition, the idle time of each job, i. e., the time neither at work
nor under ideal carriage, which decides the total time is subject to the extra
30 40 50 60
.~~ ,
.
• T
~ ,
inpu
)) (') I I r') ~ .. .. .-. ,~ I , -
.,
. ..... /.
,
A
.e '"'"'
T
,) ...... / ·rJ ~..--:
.. ./ • •
1
8
:-;, . , 0 I ,i)
~
T S
/
- ...
/
C
, (1 1 1 ......
...~ h;.t ._ . _J
• .... .
1,--... •• 1'.
• '0 • • • •
~T
..~"
0
1'-/ , ~
~" , [S'/ ~
outp " 0
70 90 l !O
...
60 80 1 10 1 0
1 .,
inpu
LA. , _.. .. '( .-, 1
A
I): :--"T" 1 I , ..L :'c ( .(
8
c W!.~
•• 0·
' I:. "r+- n:" (. ..

.......~- '..) . ..t-../ ,~ ( , (
._'-"
I ~ I
0
- -~cL
r
~ er... I' ..- t;i.'\.Ci (
output
o
(a) with the method using GGC
- - AGVl jobP job R _ ._.- job T
- - AGV 2 _ .. _ . . job Q job S
40 so 60
A .. .. l,o 1
/ . t' .""';
60 70 80 90 110 1 0 l!O
.. .. .' .......
,
Inpu
...... , . . .'
..
LA.
, ... (( :
A- s,... .
-,: !~/ ') "'"'"T d .. ) .. ....'..ti . '( 1
-.
"
8
:J'I ~ ~, --'\. .J hd'A ~ ~ : , - (
h. ' '1 ;
0
~ .( :'\ ((
.~, ~ .. . ' . _I-.
~T
;'-. Y . , . :'<, :t-., : ( - '\.. ~ ( .,~ . ~( , t
output
o
(b) with the cODventional way
Figure 4 Solutions for Job-Shop Problem with AGV (request 1, pattern 1)
time of the vehicles. Time of stoppage and of emptiness of a vehicle is equiva-

lent to the idle time of the jobs which wait for it. Time of eseape from another
vehicle is the idle time of what it is earrying. It is thought that GGC is so
effeetive beeau.se it facilitates to sum up the extra time.
Another reason for the effeetiveness of GGC is eonsidered to be the various
and relatively global informations that human seheduler is able to grasp. He
ean see at a glanee not only earriage efficieney al ready given but also, for
instanee, differenees between finishing times, positions of jobs, possible plaees
for vehicles to stay away from eollision and so on. Sueh information aids
the seheduler to balanee the earriage efficiencies between vehicles at loeal
sehedules and through the period of the whole sehedule and to eonfirm that.
!
? poo4ln 'f. s '"
<al with the method using GGC

- - AGV 1 ---- ---- job P .- ..•• -. lob R ----- jobT
.
- - AGV2 _. --. - jobQ - •. --. lobS
In'"
'R ~
p
• . 4p
_. I ':-~-'-~
~ 60
V"" /T /'.., J.I\.: ~+ 1
- .r."'t.a. . . - .
_ ••
/~
",
A
' 1 ~ · 1 [~
B
, 0
/ ; '/
p ~ •• _ .
" . ~ , ) ' -r
: l /
,
!pUl '-~ '.
t-
.. . ....
.
:
C
-
..~
V - ~.
.
, .-
'1'" I
'\ .
".
tI ~
E ~ ~
• .. u. 0
.
6 7 , 0 , 0 qo
In
- ..
" jj ~; ~ A
A-
B r' ') ., ( ~ ) ... ' . ...\.
,
:.j - , -', ~
..... :1
/ "- . ..
:A
!
,
,/
V~ :) r r: ~.~
I:
tpUI
c- ...... -~ .p, e 0'\.:Lf':.,./P .PfN
"V
... :; 41'
U
'"
"Sl ••••• p •••
~ . ~V
n •
. ~
,
i j'
E 5 0
(bl with the conventional way
Figure 5 Solutions for Job-Shop Problem with AGV (request 1, pattern 2)
4 CONCLUSION
It has been shown that GGC is effective on manual scheduling for production
systems with AGV. To make carriage efficiency of vehicles as high as possible
brings an excellent solution for job-shop problem on condition that constraints
due to AGV system are dominant. GGC visually supplies indexes of the car-
riage efficiency and other various global information. The scheduling method
with it is more effective than the conventional ways based on the calls from
jobs which have finished there tasks on machines. Furthermore, it is affirmed
that the superiority in the effectiveness of our method using GGC is kept the
same even if an optimal order of the tasks on each machine is found.
5 REFERENCES
Adelsberger, H. H. and Conen, W. (1995) Scheduling Utilizing Marker Mod-

els, in Computer Integrated Manufacturing: Proceedings of the 3rd In-
ternational Conference (ed. J. Winsor, et al. (Ed.)), 1, 695-702, World
Scientific, Singapore.
Blazewicz, J., et al. (1993). Scheduling in Computer and Manufacturing Sys-
tems, Springer-Verlag, Berlin.
Kurbel, K. and Ruppel, A. (1995) Integrating Intelligent Job-Scheduling into a
Real-World Production Scheduling System, in Computer Integrated Man-
ufacturing: Proceedings of the 3rd International Conference (ed. J. Win-
sor, et al.), 1, 679-86, World Scientific, Singapore.
Kwok, A. D. and Norrie, D. H. (1992). An Intelligent Agent System for Auto-
mated Guided Vehicle Control, in Proceedings of the International Con-
ference on Object Oriented Manufacturing Systems (ed. D. H. Norrie, et
al.), 263-70, Univ. of Calgary.
Okino, N. (1995) Theory of Biological Metaphor and its Application to Reac-
tive Scheduling, in Conference Proceedings: IFIP WG5.7 Working Con-
ference on Managing Concurrent Manufacturing to Improve Industrial
Performance, September 1995 (ed. R. L. Storch), 504-13. Univ. ofWash-
ington.
6 BIOGRAPHY
Hideaki Hase recieved M. S. degree in engineering from the Division of Ap-

plyed Systems Science, Kyoto University in 1994. He was with Kyoto Univer-
sity from 1994 to 1996 as a reserch associate. Since 1996 he has been with The
University of Shiga Prefecture where he is a research associate. His research
interests center on procedual programming language.
Norio Okino was born in Tokushima prefecture in Japan, 1933. After grad-
uating Doctor cource of Kyoto University, 1961, he started his research life as
associate professor from 1968 to 1987 and worked on CAD/CAM, Intelligent
Manufacturing Systems, Bionic Manufacturing Systems, etc. He returned to
Kyoto University on 1987 and left his job on reaching retiring age, 1997. At
this morment, he is a professor of The University of Shiga Prefecture and
professor emeritus of Kyoto University and Hokkaido University.
40
Scheduling for an automated
three-machine flowshop
manufacturing system
Jinliang Cheng and Hiroshi Kise
Department of Mechanical and System Engineering,
Kyoto Institute of Technology
Matsugasaki, Sakyoku, Kyoto 606, JAPAN,
Tel: +81-75-724-7353 Fax: +81-75-724-7300
E-mail: cheng@hon.apptec.co.jpkise@ipc.kit.ac.jp
Abstract
This paper considers a scheduling problem of minimizing the maximum com-
pletion time for an automated flowshop manufacturing system such as FMS
which consists of 3 machining cells with sufficient buffers, an AGV (auto-
mated guided vehicle) and loadingjunloading stations. For this problem we
propose a heuristic algorithm based on a fuzzy approximation (called fuzzy
scheduling), and a branch-and-bound algorithm with fuzzy inferences. Com-
putational experiences show that the fuzzy scheduling can give optimal or
near optimal solutions, and the branch-and-bound algorithm can efficiently
give optimal solutions with up to 400 parts with high probability over 90%.
Keywords
FMS, AGV, flowshop scheduling, branch-and-bound method, fuzzy inference
1 INTRODUCTON
Many flexible manufacturing systems (FMS's) have been widely used around
the world. An FMS can be characterized as a set of flexible machine tools
connected by a material handling system and which is controlled by both
computers and human operators [1]. On the other hand, the efficient imple-
mentation of such an FMS presents a complex set of issues to be solved.
Among them are scheduling problems which optimally determine when and
on what machine the parts are processed and how these parts are transported
in the system [9].
Kise [5] has considered a two-machine, one-AGV (or a robot) scheduling
problem with sufficient WIP-buffer at each machine and shown that the prob-
lem is an N P-hard 3-machine flowshop scheduling problem (denoted 3FSP).
Kise et al. [6] have proposed a branch-and-bound algorithm for the same prob-

lern, and demonstrated by numerical experiments that the algorithm can ex-
actly solve problem instances with up to 200 parts with high possibility. Stern
and Vitner [10] have dealed with a two-machine, one-robot scheduling prob-
lem with part-dependent transport times. They have shown the NP-hardness
of the problem and suggested an approximation algorithm.
Sabuncuoglu and Hommertzheim [8] have considered an FMS scheduIing
problem by using a simulation model. They have analyzed the relative per-
formances of machine and AGV scheduling rules against various due-date
criteria. Ishii and Talavage [4] have proposed a mixed dispatching rule for
each machine based on discrete event simulation in FMS scheduling. Their
system includes two loadingjunloading stations, four machines, three AGV's
and six part types. This brief survey may suggest that scheduling problems
arising in FMS's environment are hard to analytically be solved.
In this paper we deal with an automated ßowshop manufacturing system
such as FMS that consists of 3 machining cells with suffient capacity of WIP-
buffer, all of which are connected by an AGV (or a movable robot), and discuss
an optimal scheduling problem that asks to minimize the makespan of n parts
to be processed by the system. This paper aims to develop a branch-and-bound
(BAB) algorithm that could efficiently solve large problem instances with high
probability. Numerical experiments demonstrate that the BAB algorithm can
solve large problem instances with up to 400 parts in reasonable time with
quite high possibility.
2 MODEL DESCRIPTION
Figure 1 shows the physical layout of an FMS for study in this paper, which
has a loading station SL, an unloading station Su, 3 (machining) cells (e.g.,
machining centers) with pallet storage carousel, an AGV or a movable robot
and an automated warehouse. The cells, loading and unloading stations are
arranged along a loop track on which the AGV can travel in unidirection. For
this system the following assumptions are made:
= =
(1) A set of n parts, J {ili 1,2, ... , n}, is available at time O. (2) Each
of 3 cells, M, (I = 1,2,3), can process at most one part at a time, and is never
interrupted during processing.
(3) Each part i E J is processed in the order of M 1 ,M2 ,M3 and the se-
quences of processing the parts at cells M, (I = 1,2,3) are the same.
(4) Loading and unloading stations, and 3 cells have buffers for WIP(work-
in-process). The capacity of each buffer is unlimited.
(5) The AGV can carry at most one part at a time. The AGV has constant
traveling speed and fixed pickup and drop rates.
(6) Apart is released from loading station SL to the shop every time the
AGV leaves SL, then is carried to each cells, M, (1 = 1,2,3) and leaves the
shop at unloading station Su. At each cell, the· AGV stops to drop apart
which should be processed on the cell and pick up apart which should be
An automated three-machine flowshop manufacturing system 457
Automated Warehouse
Loa.ding I rs;l rs:l t unloading

Station t b:I:d b:[d Station
Automated Guided Vehicle

..
~Infinite
~ Buffer
Machining cells
Figure 1 Shop configuration
processed on the next cello The AGV leaves each cell MI (l = 1,2,3) without
waiting there until MI finishes apart if there is no part in the buffer.
(7) The processing times of part i on MI (I = 1,2,3), including set-up time,
are known and represented by PI (i) (i E J, I = 1,2,3).
(8) The times required for the AGV to carry apart from SL to Mb from M l
to M 2 , from M 2 to M 3 , from M 3 to Su and from Su to SL, including pickup
and drop times, are known and represented by tal, tl2, t23, t34, t40, respectively.
Such times are independent of the parts to be carried, thus, the time required
for the AGV to travel a complete loop, tu = tal + tl2 + t23 + t34 + t40, is
constant.
(9) An optimal sequence of processing the n parts to be found is one that
minimizes the makespan, that is, the total elapse time between the time the
first part is released from SLand the time the last part is delivered to Su.
Hereafter, this problem will be called the automated 3-machine flowshop
scheduling problem (denoted A3FSP).
3 FORMULATION OF SCHEDULING PROBLEM
The finishing time of machining part i on MI (l = 1,2,3) is represented by

FI (i), and the time of picking part i from MI is represented by 11 (i). Further-
more, the time part i leaves SL and the time it arrives at Su are represented
by To(i) and F(i), respectively. Then, the schedule of the k-th part jk in any
sequence, S = (il,h,"',jn), can be formulated as folIows.
By assumption (6), it can be seen that

TO(jk) = (k - 1)t v , k = 1,2,"" n. (1)
From assumption (1)rv(8), the start of machining part jk on MI must be
after the machining part jk-l has finished and after jk has been transfered to
MI by the AGV, so the finishing time of machining part jk on MI is given by
Fl(jk)= max{Fl(jk_I), T)-l(jk) + tl-I,I} + PI (jk),
= =
1 1,2,3;k 1,2,···,n, (2)
where FI(jo) = 0(1 = 1,2,3).
Picking part jk from MI must be started at a time the AGV arrives there
after the finis hing of machining jk on MI, then
T)(jk)?' tOI + Xlktv ? FI(jk), 1 = 1,2,3; k = 1"", n, (3)
where Xlk is the minimal integer such that Eq.(3) holds, and tOI = tOI + ... +
tl-I,1 (1 = 2,3,4). From Eq.(3)
Xlk?f(Fl(jk)-tot}/tvl, l=1,2,3;k=1,···,n, (4)
where fx 1is the minimal integer greater than x. By assumption (5), the AGV
can pick jk from MI only after it picked part jk-l from MI and arrives at MI
again, i.e.,
T)(jk) ? T)(jk-l) + tv, 1 = 1,2,3; k = 1"", n, (5)
where TI(jo) = O(l = 1,2,3), then from Eqs.(3)rv(5),
T)(jk)= max{f(Fl(jk) - tod/ivltv + tOI, T) (jk-l) + t v },
1 = 1,2,3;k = 1,···,n. (6)
The time part jk arrives at Su is
F(jk) = T3(jk) +t34, k=1,···,n. (7)
Thus the schedule can be computed by Eqs.(1), (2), (6) and (7), and the
maximum completion time Fmax(s) under the sequence s is
(8)
4 FUZZY SCHEDULING
4.1 An approximation of makespan
Problem A3FSP is NP-hard, even for the case of two-machine sysytem [5].
Thus, we need good heuristic for practical purposes. However, the above for-
mulation that expresses makespan Fmax by recursive equations (1), (2), (6),
(7) and (8) make us somewhat difficult even to have an insight for a good
heuristic. Thus we consider the following approximation of Fmax(s).
An automated three-machine jlowshop manufacturing system 459
In Eq.(6) we relax assumption (5) to the one that the AGV can simulta-
neously carry parts existing in a buffer except SL. Then the time when the
AGV leaves cell M, is given by
(6)'
'iHik) is a lower bound of 1}(jk) in Eq.(6).
Let FHik) be the finishing time of part ik on cell M,(l = 1,2,3), F(jk)
be the time when part ik arrives at Su and Fma:t'(s) be the makespan, all of
which are computed by Eq.(6)' instead of Eq.(6). Then we have
k
Fdik)= max {(p -l)tv +
1$p9
L: PI(ih)} + tOl,
h
=p
k
F,(jk) 75, l~a.tk{FI-l(jP) + L:P,(jh)} +t v +t'-l," 1=2,3,

-p- h=p
T3 (jk)75, F3 (jk) +t v , k = 1,,,, ,no (9)
Thus,the following upper bound U B(s) of Fma:t'(s) can be obtained.
Fma:t'(s)75, UB(s) = C(s) + 2t v + tO,4 (10)
where
o p q n
C(s)= max
l<o<p<q<n
{L: t + L: PI(ih) + L: P (jh) + L: P (jh)}
v 2 3 (11)
- - - - h=l h=o h=p h=q
Obviously minimizing U B(s) is equivalent to minimizing C(s). The problem
of minimizing C (s) is a 4FSP with processing time t v , Pl (i), P2 (i), P3 (i) of part
i and with no transportation time of the AGV. That is, the original A3FSP
can be approximately reduced to a 4FSP.
4.2 Fuzzy sched uling method
The fuzzy scheduling method has been proposed to yield nearly optimal so-
lutions for an m-machine FSP [2]. The basic idea of this heuristic is to use
a membership function in the context of fuzzy inference for obtaining an ap-
proximate solution. The membership function represents a possibility that the
dominance relation between parts holds even if its precondition does not hold.
We describe it briefly below.
For the above reduced 4FSP of Eq.(11), let flow time of part ik on the l-th
=
machine (I 2,3,4) for a partial sequence ofthe first k parts, Sk (h,' .. , ik),=
be defined by
(12)
where F1}(jk) is the finis hing time of processing part ik on the l-th machine
in sequence Sk for the 4FSP. Similarly flowtime FTl (Sk, i) of part i in sequence
(Sk, i) adding i after Sk and FTl(Sk, i,j) ofpart j in sequence (Sk, i,j) adding
j after (Sk, i) are defined.
Theorem 1. [2] Assume that two parts i and j are optimally processed
immediately after partial sequence Sk, part i optimally precedes part j if
FTl(Sk,i,j) $ FTl(Sk,j,i), 1=2,3,4. (13)
Eq.(13) rarely holds in realistic situations. But it is a sufficient condition

for the optimal schedule. This suggests that if Eq.(13) approximately holds,
then part i may precede part j in an optimal schedule with high possibility.
We take advantage of this possibility for searching an optimal schedule, and
represent it by a membership function in the fuzzy inference. That is,
then the membership function that represents the degree that part i optimally
precedes part j is given by
D(Sk,i,j)
(t,. J') = 0.5 - 2D
jJSk () , (15)
max Sk
where D(Sk, i,j) = Ei=2 O!/_lD/(Sk, i,j), Dmax(Sk) = maXi,j /D(Sk, i,j)/ and
0!1,0!2,0!3 (0 $ 0!1,0!2,0!3 $ 1 and E~=lO!/ = 1) are real numbers. Then, the
degree of dominance of part i over the remaining parts under partial sequence
Sk (k = 0,1, ... , n - 1) is given by
(16)
then part i* satisfying
(17)
is identified as the part that immediately follows Sk, where Jr is the set ofthe
remaining r( = n - k) parts.
The rule determining i* by this way is referred to as fuzzy rule and the
scheduling applying the fuzzy rule is referred to as fuzzy scheduling. We use
a fuzzy schedule obtained as an approximate one of the original A3FSP, and
its makespan (exactly computed by Eq.(6)) is used as an initial upper bound
value of the BAB algorithm proposed next for the original A3FSP.
5 BAB ALGORITHM
It is assumed that the basic principle of BAB algorithm is weIl known (e.g.,
see [3]). Hence only the basic components of BAB algorithm are stated below.
An automated three-machine flowshop manufacturing system 461
5.1 Subproblem
Let the sequence of the first k parts fixed be Sk = (iI, ... ,jk)' The problem of
deterrnining an optimal sequence of the remaining r( = n - k) parts under the
sequence Sk is called a subproblem of depth k and is represented by P(Sk)'
5.2 Lower bound
For a given sequence of the first k parts, Sk and an arbitrary sequence of the
remaining r parts, Sk = (jk+1, ... ,jn)' from Eqs.(1),(2) and (6) we have
Tdjn)?' max{Fdjk) + Y l1 (Sk), (k - 1)tv + Y01 (Sk) + tod,
T2(jn)?' max{F2(jk) + Y22 (Sk),F1(jk) + Y 12 (Sk) +t 12 ,
(k - 1)tv + Y02 (Sk) + t02},
T3(jn)?' max{F3(jk) + Y33 (Sk) , F2(jk) + Y23 (Sk) + t23,
F1(jk) + Y13 (Sk) + t13, (k - 1)tv
+ Y03 (Sk) + t 03 }, 0:S k:S n - 1, (18)
where
n
L Pv(jh)], O:S u :S v :S 3, (19)
h=q(v-1)
and PO(jh) = tv(h = 1"", n).
Now we consider the minirnization of each Yuv(Sk) Eq.(19) that yields a
lower bound of T v(in) of Eq. (18), and leads to the one of the makespan F (jn)
of Eq.(8). The rninimization of Yuv(Sk) is reduced to an FSP with processing
time P/(i) ofpart i on l-th machine. But it is NP-hard. Therefore, we consider
the minimization of the following lower bound Y.!'v (sk) of Yuv (sk) instead of
Yuv(Sk) itself, which is obtained by only considering the terms for k < q(u) =
q(u + 1) = ... = q(v - 1) :S n and excluding the other terms of Yuv(Sk), i.e.,
Yuv(Sk)?' Y.!',,(Sk)
n
+ L P,,(jh)] (20)
h=q(v-1)
The minirnization of Y.!',,(Sk) is reduced to a special 3FSP where the first
machine and the third machine are separated by a non-bottleneck machine
with processing time E;;';+1 Pl(j) of part j [7]. Furthermore,
q 11-1 n 11 11-1
Y:1I(Sk)= k<q<n
max [ L (L P'(jh)) + L( LPl(jh))] - 'L.J
" YiI(Sk)
- h=k+1 l=u h=q l=u+1 l=u+1
11-1
= ZU1I(Sk) - LYiI(Sk),l:::; u < v :::; m (21)
l=u+1
and the problem of minimization ZU1I(Sk) is reduced to a solvable 2-machine

=
FSP with processing time a(i) E;;,; Pl(i) on the first machine and b(i) =
E~=U+1 Pl(i) on the second machine. Let Z=1I(Sk) be its minimum value. Here
we should note that processing of part jk+1 on machine M u can not be started
before F~(jk) = max19~u[FI(jk) +minAI,u-l(Sk) +tlu], and T1I (jn) must be
dependent of t 1l and times the AGV goes around the loop track till T1I (jn)
(see Eq.(3)), then it can be easily seen by Eq.(18) through Eq.(21) that
11-1
g~1I (Sk)= rF: (jk) + Z=1I (Sk) - L YiI(Sk) + tU1I - to1l )/t1l lt1l + t 01l (22)
l=u+l
is a lower bound of T1I (jn) for subproblem P(Sk), where minA u+1,u(Sk) =
0(0 :::; u :::; 3), minAu1I (sk) = mink<h~n[E~=u Al (jh)] (1 :::; u :::; v :::; 3) and
Al(i) = max{PI(i), t 1l }. Then,
gU1I(Sk)= r(g~1I(Sk) + minA1I+1,3(Sk) + t1l3 - t03)/t1l 1t1l + tO,m+1 (23)
is a lower bound for subproblem P(Sk)'

We employ
(24)
as a lower bound for P(Sk)' Lower bound 9(Sk) for any subproblem P(Sk)
except P(0), i.e., the original problem can be computed in O(n) time and
g(0), the lower bound of the original problem in O(n log n) time.
5.3 Fuzzy scheduling and fuzzy search
We use the fuzzy scheduling as mentioned before as the initial incumbent

solution that takes a role of an upper bound of the optimal value. We adopt
a depth-first search method that selects a subproblem with the smallest lower
bound among the most recently generated ones, breaking ties by the fuzzy
rule proposed in [2]. We call such search method the fuzzy search.
An automated three-machine ftowshop manufacturing system 463
6 NUMERICAL EXPERIMENTS
In this section, performanc~s of the BAB algorithm with fuzzy inferences

proposed here are evaluated by the way of numerical experiments. For each
n and tu, 30 problem instances have been tested. The processing times of the
parts (P1(j)) are generated for a uniform distribution over the integers from 1
to 99, inclusive. For weights (}:I (l = 1, 2, 3) of membership function j..t. (i, j) in
Section 4.2, three types of function were applied to each problem instances.
They are: (1) arithmetical progression weights, ():/ = l/6; (2) equal weights,
(}:I = 1/3; (3) inverse arithmetical progression weights, ():/ = (4 - l)/6(l =
1,2,3). Three schedules are obtained and the best one of them is adopted.
In the fuzzy search of the BAB algorithm, only the arithmetical progression
weights are used.
All programs were compiled in FORTRAN, and run on a DEC 3000 work-
station (35MFLOPS). The runing time (CPU time) of the BAB algorithm
was limited within 5 min., and a problem instance that could not be solved
within 5 min. has been identified as unsolved.
6.1 Performances of fuzzy scheduling
Table 1 and 2 show results obtained for test problems, where Rps and Rpc
represent average relative errors of the fuzzy scheduling and the FCFS (First
Come First Served) scheduling, respectively. The comparisons with the FCFS
scheduling in Tables 1 and 2 show the effect of the optimization by the fuzzy
scheduling. Table 2 also shows the influence of the number of parts, n on
the performance of the fuzzy scheduling. Table 3 shows how many problem
instances can optimally solved by the fuzzy scheduling. We can conclude from
these results that the fuzzy scheduling is superior.
Table 1 Average relative errors(%) offuzzy scheduling for n = 10
0.1 1.0 16.8

0.2 1.2 16.6
0.3 1.6 16.9
0.4 1.9 15.9
0.5 2.9 15.9
Average 1.7 16.4
*: Pmean = 50 is the mean processing time.

Table 2 Average relative errors (%) of fuzzy scheduling for t" =

15(t,,/Pmean / = 0.3) for solved instances
n 10 20 30 40 50 100
RFS 1.6 0.8 0.4 0.4 0.3 0.1
RFC 16.7 12.1 10.8 8.3 7.9 5.4
Table 3 Rate (%) of problem instances with n 10 for which the fuzzy
scheduling gives optimal solutions
t,,/ Pmean 0.1 0.2 0.3 0.4 0.5 Average
A 53 47 50 50 40 48
6.2 Evaluation of BAß algorithms
To examine the performance of the BAB algorithm with fuzzy inference , the
following four kinds of BAB algorithms were implemented and compared:
(1) A: BAB algorithm with fuzzy inferences proposed here; (2) Al: BAB
algorithm A without fuzzy search; (3) A 2 : BAB algorithm A without fuzzy
scheduling; (4) A 3 : BAB algorithm A 2 without fuzzy search.
The rates of problem instances solved by these algorithms are shown in
Table 4. It is evident that Algorithm A is superior to Al I A 2 and A 3 . The
comparison with Al as weIl A 3 shows the effect of the fuzzy search on the
performance of Algorithm A, and the comparison with A 2 as weIl A 3 shows
the effect of the fuzzy scheduling on the performance of Algorithm A.
Table 5 show the influences of the number of parts on the solvability of
Algorithm A. We can conclude that the BAB algorithm A can solve problem
instances with 400 parts with high probability over 90%.
7 CONCLUSION
In this paper we have considered a scheduling problem of minimizing the

makespan for an automated 3-machine flowshop such as FMS that consists
of 3 machining cells with sufficient buffers, an AGV and loading/unloading
stations, and shown that the problem can be approximately reduced to a
4-machine permutation flowshop scheduling problem. Based on this re duc-
An automated three-machine jiowshop manufacturing system 465
Table 4 Rate (%) of problem instances solved within 5 min. by BAB algo-
= =
rithms (t v 15(tv/Pmean 0.3))
n A Al A2 A3
10-20 92 90 92 88
30-40 87 82 87 78
50-60 93 85 93 83
70-80 90 78 87 67
90-100 93 87 88 75
110-120 92 83 83 62
130-140 92 87 85 55
150-160 92 80 88 47
170-180 95 87 87 45
190-200 90 78 78 48
Average 92 84 87 65
Table 5 Rate (%) of problem instances solved within 5 min. by Algorithm

A for larger problems(t v = 15(t v / Pmean = 0.3))
n A n A
210-220 90 310-320 83
230-240 88 330-340 100
250-260 92 350-360 92
270-280 92 370-380 97
290-300 90 390-400 83
Average 91
tion we proposed a heuristic algorithm called the fuzzy scheduling, and a

branch-and-bound algorithm with fuzzy inferences. Extensive numerical ex-
periments show that the fuzzy scheduling can give optimal or near optimal
solutions, and the branch-and-bound algorithm with fuzzy inferences can effi-
ciently give optimal solutions to problem instances with up to 400 parts with
high probability.
8 REFERENCES
[l]Buzacott, J.A., and Yao, D.W. (1986) Flexible manufacturing systems: A

review of models. Management Science, 32, 890-905.
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rithm with fuzzy inference for apermutation flowshop scheduling problem.
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[3]Ibaraki, T. (1987) Enumerative Approaches to Combinatorial Optimiza-
tion Part I, Annals of Operations Research (P.L. Hammer Ed.), 10,
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[4]Ishii, N. and Talavage, J.J. (1994) A mixed dispatching rule approach
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[5]Kise, H. (1991) On an automated two-machine flowshop scheduling prob-
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[6]Kise, H., K. Kohno, K., Shioyama, T and Kushiyama, T. (1992) Optimal
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[7] Lageweg, B.J., Lenstra, J.K. and Rinnooy Kan, A.H.G. (1978) A gen-
eral bounding scheme for the permutation flowshop problem. Operations
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[8] Sabuncuoglu , I. and Hommertzheim, D.L. (1993) Experimental investiga-
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[9]Stecke, K.E. (1985) Design, planning, scheduling, and control problems of
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9 BIOGRAPHY
Jinliang Cheng received M.E. from Wuhan University of Technology, China,

and Dr. of Engineering from Kyoto Institute of Technology, Japan. He is now
with Applied Technology Corporation, Japan. He is interested in production
scheduling, modeling and analysis of manufacturing systems.
Hiroshi Kise is Professor at Department of Mechanical and System Engineer-

ing, Kyoto Institute of Technology. He received M.E. from Kyoto Institute of
Technology and Dr. of Engineering from Kyoto University. His research inter-
ests include deterministic and stochastic scheduling, and production system
modeling and analysis.
41
DEJA VU - A reusable framework for
the construction of intelligent
interactive schedulers
Jürgen Dom, Mario Girsch, and Nikos Vidakis
Institut für Informationssysteme, Technische Universität Wien
Paniglgasse 16, A-/040 Vienna, Austria
E-mail {domlgirschlvidakis}@dbai.tuwien.ac.at
Abstract
We describe the techniques of the DEJA VU Scheduling Class Library to achieve a
library of reusable and extendible c1asses for the construction of interactive
scheduling systems. The constructed systems shall be efficient and user centered.
We describe abstract scheduling objects, constraints between them, and potential
user interactions with the system. A first scheduling system was developed for the
steel plant of Böhler Kapfenberg. We demonstrate which extensions were neces-
sary and show prototypical examples from the graphical user interface.
Keywords
Scheduling, Software Reuse, Soft Constraints, Steel manufacturing
1 INTRODUCTION
DmA VU is a framework of C++ c1asses supporting the construction of industrial

scheduling systems. The design was directed by the following criteria:
• the evaluation of a schedule is based on the evaluation of individual constraints
and their weighted aggregation,
• the user has the full control over the scheduling process with the ability to
experiment with different settings,
• iterative improvement methods are applied to optimize solutions, and
• the framework should be extendible and refinable.
1.1 Constraint-based Representation of Schedules
Scheduling is an activity controlled by constraints and guided by several objective

functions. Usually scheduling is described as a problem of satisfying temporal con-
straints. However, temporal constraints such as due dates and objectives such as

minimization of the mean flow-time are often insufficient to represent industrial

problems. DEJA VU supports constraints and objectives like compatibility con-
straints, idle time constraints, minimization of substitutable resources, or equilibre
load of sharable resources. These constraint types have been derived from several
scheduling problems. New constraint types can be generated by deriving from
existing types with minimal effort due to the general approach to represent them.
Many constraints of industrial production environments are soft and can be
relaxed. Moreover, objectives may be contradictory and a trade-off between them
must be found for a good solution. These requirements are reflected by the con-
straint model: A constraint is a relation between two or more scheduling objects
and/or attributes. The relation is mapped on a satisfaction degree that evaluates
how good this constraint is satisfied in the actual schedule. Different constraint
types obtain a domain-dependent weight reflecting the constraint' s importance for
the domain. A schedule is evaluated by a weighted aggregation of all satisfaction
degrees. Further, for each constraint type a threshold to decide whether the con-
straint violation is hard can be specified.
1.2 Interactive Scheduling
An automatic scheduler cannot consider all aspects relevant to the evaluation of a

schedule because the environment of industrial scheduling systems is too complex
and many quantities cannot be measured. The complexity also comes from the ever
changing production environment: new machines are erected and new production
techniques and objectives arise regularly. The software must therefore be adar't-
able, but under the full control of the user to overrule outdated system rules.
Although production control and planning software shall support human personnel
as far as possible, the responsibility should remain in human hands. Mixed-initia-
tive scheduling is a paradigm that solves this problem best. Whenever the user has
the ability to let the system schedule automatically or to perform some scheduling
tasks manually. The user can always change the schedule constructed by the sys-
tem, but the system should show new conflicts effected by this change to the user.
Furthermore the user can "freeze" some part of the schedule and let the system im-
prove the remaining part. DEJA VU supports interactive scheduling by scheduling
tasks for schedule alterations providing a common interface with methods for un-
doing, redoing, evaluating, etc.
1.3 Iterative Improvement Methods
Iterative improvement is a search method which starts with an initial solution and
tries to improve it by "local" modifications. The initial schedule can be constructed
randomly, by a constructive method, or by an heuristic method. It can also be cre-
ated by a human or another computer process. To modify given schedules,
scheduling tasks are used to trans form a schedule into a new and similar schedule.
A scheduling task can be e.g., the exchange of two adjacent jobs. If several tasks
A framework for the construction of intelligent interactive schedulers 469
are applicable, a procedure must choose the task to be applied. This selection can
be made randomly or with some look-ahead, allowing the selection of the best
"neighbor". To determine whether an improvement can be achieved by a task, the
evaluation of schedules is compared. The most efficient look-ahead is achieved
when the new schedule can be evaluated locally.
A simple hill-climbing algorithm would accept only schedules having a better
evaluation. Since scheduling problems tend to have many solutions with different
qualities that are not direct neighbors, a search method based on local improve-
ments can be trapped in a local optimum. An important feature of all iterative im-
provement methods is the capability to escape from local optima. However, with
this ability the probability of searching in cycles raises and some kind of control to
avoid repetitions is needed.
DEJI\. VU allows the user to select between different improvement methods and
to set different parameters of these algorithms indi vidually. Furthermore, if another
combination of techniques seem to be appropriate this can be easily realized by
derived classes since the optimization algorithms are also designed as classes that
can be inherited. Experimental comparisons of these algorithms with data from the
VA Stahl Linz LD3 plant are described in (Dorn et al. 1996) and important design
issues for iterative improvement methods in (Dorn 1995).
1.4 Reusability of Scheduling CIasses
The main principle to support the reusability is the object-oriented design of the
software. However, the critical task in designing reusable software (or reusable
objects) is always to foresee the potential extensions and problems of new applica-
tions. A good practice is to implement existing theoretical frameworks because
they are based on abstractions of many practical applications. Especially in
scheduling, there is a large amount of theoretical work offering many forms for
such a design. Objects like order, job, operation, resource, allocation, and sched-
uZe or synonyms exist in almost every theoretical investigation. Unfortunately, this
theoretical work does not integrate user interaction with schedule optimization.
The core of DEJI\. VU are abstract classes realizing the basic scheduling theory.
Forms for the representation of constraints are also realized by abstract classes.
This abstract core enables an application- and platform-independent definition of
• a schedule evaluation (all constraints stored in a constraint list are evaluated
and aggregated),
• scheduling tasks (exchange of operations on aresource, exchange of jobs, ... )
• algorithms that apply and compare applicable scheduling tasks to find better
schedules, and
• graphic entities like windows, panes, and text fields to represent scheduling
objects on the user's desktop.
On top of this core common specializations such as a job-shop or a flow-shop
schedule and several optimization algorithms are implemented. A further deriva-
tion layer consists of specific classes for steelmaking applications.
2 SCHEDULING OBJECTS
The main scheduling object is a schedule consisting of three conceptual parts:

• a list of resources with scheduled allocations,
• a list of jobs with their operations, and
• a list of constraints.
The main design criteria for a schedule are:
1. the representation should be as flexible as possible to enable the representation
of schedules of different applications with different resources and jobs,
2. support of scheduling tasks initiated either by a user or iterative improvement,
3. scheduling tasks must be very efficient to provide users an immediate feedback
and to fasten the optimization algorithms, and
4. a schedule should be an object that can be copied efficiently.
Flexibility and efficiency are two potential conflicting objectives for which a trade-
off must be found. Thus, pointer arithmetic is used for the core schedule instead of
pure object oriented representation. Lists are realized as pointer arrays based on the
template mechanism of C++. They can be extended dynamically and store only
pointers, because it is not know in advance how much storage is needed for the
objects. A typical resource points to a double-linked list of allocations that store
when operations are performed on the resource and a job points to a double-linked
list of allocations describing allocations of a job.
The dynamic links between allocations support the algorithm that checks and
enforces temporal consistency of all allocated operations. Each time an operation is
moved in the schedule, the adjacent allocations of its resource and its job are
adjusted temporally. An adjustment of another allocation will be propagated. This
consistency mechanism is complete because only simple temporal algebra is used.
Schedule
Allocations
Figure 1 Structure of a Schedule

Aframeworkfor the construction ofintelligent interactive schedulers 471
The sequence of the jobs in the list of all jobs represents also the sequence of
jobs in the schedule. This sequence may be changed by certain scheduling tasks,
but a move of a job is further propagated to each resource on which this job is
scheduled to move also the allocation accordingly.
We define one abstract root schedule dass which realizes many methods suffi-
cient for handling schedules. However, we specialize a schedule to reflect certain
characteristics of job shops and flow shops. For a certain application, we may
further specialize to represent in this dass application specific information and to
overload general methods by more efficient domain-dependent strategies.
Methods dependent of the schedule type are the methods that realize different
scheduling tasks. For the efficiency of scheduling tasks it is better if inverse
scheduling tasks can be defined instead of copying whole schedules. Moving a job
from one position to another in a flow-shop is more efficient, because its opera-
tions are in the same sequence for both jobs and its inverse task can be defined
easily by storing the old position. In a job-shop, it is not dear what an exchange of
two jobs means. The jobs may be allocated on different resources which cannot be
used for the other job and two jobs may be scheduled overlapping. We can define
the move, but for the inverse task we must return to the old schedule by copying
the old schedule. For a flow-shop, the move of single operations is not useful. Each
schedule type has its own method for deciding which scheduling tasks are applica-
ble and how it can be performed, if possible.
2.1 Allocations
An allocation is an assignment of an operation being part of a job to aresource.

The allocation is a temporal interval consisting of start, duration, and end. Simple
allocations are used for resources that can perform only one operation at a time and
thus cannot overlap temporally . Allocations on a resource are linked forwards and
backwards. For the basic type of allocation, a temporal sequence can be conduded,
but the derived capacitive allocation may overlap. To find the job and the resource
object to which the allocation belongs, two pointers to these objects are stored.
Further pointers to the next and to the previous allocation of the job exist. If a pre-
decessor allocation exists on the resource, one or more allocation constraints may
be stored.
2.2 Resources
A resource stores the operations of different jobs to be performed on it. Resources

are generated from a description of the scheduler dass. Resources maintain their
own list of resource constraints. The dass resource is an abstract dass from which
no objects can be generated.
Most typical is the non-sharable resource on which operations required by a
job are allocated. These allocations are stored in double-linked list whereby the
sequence in the list reflects also the temporal sequence. The link structure is effi-
cient for scheduling tasks such as swapping allocations. The non-sharable resource
has apointer to the first and to the last allocation. A non-sharable resource knows
how to perform scheduling tasks as allocating, swapping, moving, or deleting an
operation. Attributes may be defined such as minimal idle time or required set-ups.
If it allocates operations or modifies the allocations, it maintains the constraints
derived from the idle time and the set-up attributes accordingly.
A sharable resource can be used by several jobs simultaneously. An example is
the space to store products. This space is often limited but several products pro-
duced in different jobs may be stored at the same time. Since such resources have a
limited capacity and different operations may require different amounts of the
resource, a capacitive allocation is used to incorporate additional attributes for size
and amount. Scheduling tasks, such as moving or shifting an allocation must be
realized for sharable resources. The maximal capacity of a sharable resource is a
hard constraint, but the equilibre load may be a soft constraint. A typical example
is energy consumption which has an upper limit. For a cheap production however,
it is important to distribute the energy consumption as much as possible over the
whole production period because peaks in the energy consumption are often
expensive.
A resource group represents a group of almost identical resources. For the pro-
duction process, it makes no difference which of them is used because all have the
same capabilities. Yet, an objective such as to minimize the number of used
resources and constraints on subsequent allocations may constrain the usage of
resources. The only scheduling task a resource group must support is the move of
an operation from one of its resources to another. Other tasks are deferred to the
resources. A special method of a resource group is the method of finding the best
resource for an allocation. Generally , this will be the first available resource.
Derived classes will overload this method with more sophisticated heuristics.
2.3 Orders and Jobs
An order describes the product to be produced, the required operations and their
required sequences, its priority, and such constraints as the release and the due
date. The operations and their temporal relations are described in a process plan. A
job describes the performance of an order in the shop floor. It may be scheduled to
pro du ce several orders. The main conceptual difference is the specification of
planned starting and finishing times for the scheduled operations, whereas the
order describes only the requirements.
In some domains the order does not need to have a process plan to describe the
required operations and their temporal dependencies because the sequence is for all
jobs mainly the same. In this case a job is generated from an order by following
predefined rules of its domain. A process plan is then constructed for the job.
When a job is generated from an order, some attributes like the release and the
due date are copied into the job. However, a job also has apointer to its order
because some computations are dependent on the produced good that is not repre-
sented in the job object. A job points at its first and its last allocation and these are
, Aframeworkfor the construction ofintelligent interactive schedulers 473
linked in the "allocation network". For a simple flow-shop job, the chain of job
allocations describes a sequence of operations. If a more complex temporal depen-
dency must be described, interval relations are used (Dom 1995b). Jobs have a
unique identifier to enable pointing to the same job in two schedules. Furthermore,
a job maintains its own list of job constraints. If certain operations of a job are
modified, the job updates these constraints accordingly. If the last operation is
moved, the tardiness constraint is updated.
2.4 Scbeduling Tasks
Scheduling tasks are a paradigm for the coupling of automatie scheduling with user
actions and is derived from concepts in model-based knowledge acquisition (e.g.
Bylander and Chandrasekaran 1988). In principle, we model each action that can
be performed by the user as a scheduling task. A scheduling task is described by a
class that provides all types of tasks a uniform interface. If a new task is to be
defined, all methods of this interface must be realized. If a task is initiated by the
user, all necessary data are stored to undo or redo it. The definition of an inverse
task also supports the iterative improvement methods. With such a search method,
we apply a scheduling task to check whether a task leads to an improvement. To
evaluate the schedule, operations and jobs of the schedule have to be adjusted. If
other alternatives are tried, we must return to the old schedule. For complex appli-
cations it is more effective to have a task that makes the last change undone than
copying a whole schedule. In cases in which no reverse task can be specified, we
store the whole schedule before performing the task. Additionally, for tabu search,
the inverse tasks are used as a tabu criterion, thus forbidding cycles during search.
The realization of scheduling tasks is dependent of the schedule type. So the
performance in a job-shop and in a flow-shop can differentiate and some tasks are
not applicable in all schedule types. For example, the move of an operation in a
flow-shop and the exchange of ajob in ajob-shop are not allowed.
Following scheduling tasks are defined: to allocate a job as early as possible, to
allocate a job after another job, to allocate a job at a certain time, to remove a job
(back into the list of orders), to exchange two adjacent jobs, to move a job to
another position, to exchange an operation with an adjacent operation, to move an
operation to another place on the resource, to move an operation to another
resource, and to shift an operation. This set of operations can be extended easily if
other tasks are becoming necessary for an application.
3 CONSTRAINT EVALUATION
The evaluation of schedules in DEJA. VU is based on the evaluation of individual

constraints. Constraint types are differentiated and we define, for example, tardi-
ness constraints. If all tardiness constraints of a schedule are evaluated, the tardi-
ness of jobs is a measure of the schedule. For a certain application, different mea-
sures can be defined. In a preference-setting dialog, the user can select which of
these defined measures shall be evaluated for the next schedule construction pro-
cess. The settings can be assigned to a schedule thus constructing schedules with
different evaluations.
3.1 Constraint Evaluation
A constraint is a relation between two or more scheduling objects or attributes of

them mapped on a satisfaction degree which evaluates how well the constraint is
satisfied in the actual schedule. A typical example of such a relation is the tardiness
of a job. A due date indicates when a certain job should be completed, which is
related to the scheduled finishing time. The relation is mapped on a satisfaction
degree that indicates how good this constraint is satisfied. If the finishing time
equals the due date, the satisfaction of this constraint is considered to be very good.
Otherwise it is considered to be poor. This exact meeting of a due date is modeled
by a tardiness constraint. The relaxed form where a too early completion is also
good is realized by a lateness constraint. A tardiness constraint shall illustrate how
a constraint is specified and how its satisfaction is computed.
If a job has a due date (DD), the job creates a tardiness constraint having two
parameters "OptimalDeviation" (OD) and "LeastAcceptableDeviation" (LAD). If
the deviation between due date and finishing time (Fr) is smaller than the optimal
deviation, the constraint evaluates to 1.0. If it is larger than the least acceptable
deviation, it evaluates to O. Otherwise, it is computed as follows:
'~~::.r~~~~<:J
LO
0.0
II •
release date due date time
Figure 2 Satisfaction Degree of a Tardiness Constraint
3.2 Constraint Types
Below the abstract root constraint dass, four abstract constraint dasses are defined
describing relations between different scheduling objects. An allocation constraint
relates an allocation with its predecessor. If this sequence is changed, the resource
updates this constraint. A job constraint relates different attributes of a job. If one
of these attributes is changed, the constraint is updated by the job. A resource
constraint describes a relation between different objects and attributes of a re-
Aframeworkfor the construction ofintelligent interactive schedulers 475
source. The update is initiated by the scheduling object if all changes on this
resource are finished. The fourth kind is a form relating objects of the whole
schedule. The schedule constraint is maintained by the schedule. The four
described abstract classes support the construction of new constraint types because
they define a common interface and a predefined mechanism to create and update
them. The scheduling objects only know this interface, and the allocation can
update a constraint without knowing which actual constraint type it iso If a new
allocation constraint type is defined, a derived class of an allocation has to insert
this constraint, but no further changes need to be made.
All constraints defined below the four classes are no longer abstract. These
constraint types describe actual relations between scheduling objects. After being
updated, they will have a satisfaction degree which is used to evaluate a schedule.
To reflect that different constraint types have different importance for the applica-
tion, constraint types are associated with a weight factor between 0 and 1. The sum
for all types is defined as "1". If several constraint types are defined, a weight of
e.g . .4 means that this constraint type has a great influence on the evaluation func-
tion. Another attribute describes a threshold to differentiate soft and hard constraint
violations. A constraint satisfaction below this threshold indicates that the con-
straint must be repaired to get a legal schedule. If the threshold is set to 0, no repair
will be necessary.
A special constraint which is elaborated upon is the compatibility constraint. It
is a relation between subsequent operations assigning a value to this pair, reflecting
how optimal it is to schedule both after each other. In the process industry, re-
sources are often infiltrated with residuals of the produced good which may spill
subsequent products. This infiltration can either be accepted (if small enough), or
some cleaning operation must be scheduled as weIl. A compatibility constraint can
represent the cost of a cleaning operation or the quality-Ioss due to the infiltration.
For some processes, such as steel making, cleaning operations are either not possi-
ble, or too expensive. It is therefore important to find sequences that incorporate
only a small infiltration. Thus, the threshold cannot be "0". Compatibility con-
straints can be seen as a prototype of the way new constraints can be integrated in
the framework. For allocations having such a compatibility aspect the compatible
allocation class was derived from an allocation. It creates a compatibility con-
straint if certain conditions hold. Compatibility constraints and the way they are
handled are explained in more detail in (Dorn and Slany 1994).
4 REUSABILITY OF DEJA. VU
With the DEJA VU Class Library we have implemented a scheduler for the Böhler
company in Kapfenberg (Austria) to schedule heats in a steelmaking plant. This
application described in detail in (Dorn and Shams 1995) is a prototype for indus-
trial applications, characterized by a lot of domain-dependent data that users want
to see on their computer desktop. Moreover, many of the preferences in solving
subproblems must be applied. These very domain-dependent features are realized
by new derived classes. For example, the existing order class with 10 attributes
must be speeialized to read more attributes (about 30). Nevertheless, teehniques as

presenting an order graphieally, deleting an order, or to sehedule an order neednot
be re-implemented. These modifieations have no effeet on the interaetion classes or
on the algorithms that require the evaluation and seheduling tasks. Another refine-
ment that must be performed for the applieation is the design of new windows.
This ean again be aehieved by deriving from existing window classes.
We estimate that only about 10% new eode has been developed for the applieation.
A seeond applieation for a different steel plant has been used as a further test-bed
whieh shows that approximately the same effort is required here.
The following graphies show two views of the sehedule whereby the first is
generie and the seeond speeifie for the applieation. The main sehedule window
shows the whole sehedule in aseroll pane. Resourees are shown below eaeh other.
For example, the first resouree in the figure is an eleetrie are furnaee (EAF), then
one sees a group of ladles. The alloeations on these resourees are depieted by small
panes. The last two resourees are sharable resourees that deseribe the spaee
requirements in the teeming bay and the load of the workers in the teeming bay.
The bottom window shows the total evaluation and the mean ehemical eompatibil-
ity. With apopup menu the user ean also seleet other measures.
Figure 3 Graphical Representation of a Sehedule
BY clieking on the panes in the window, the user ean seleet operations and jobs to
move them to other plaees in the sehedule. If an operation or a job is seleeted,
menu eommands ean also be applied to the seleeted objeet.
The information shown in the sehedule window is not always suffieient. With a
double-click on the resouree name's pane, the system opens a window speeifie for
a resouree. The following figure shows a window for the eleetric are furnaee. On
the right side one ean see a logarithmie diagram that visualizes the ehemieal eon-
tent of subsequent orders on the furnaee.
A framework Jor the construction oJ intelligent interactive schedulers 477
Figure 4 Resource Window
5 CONCLUSIONS
To improve the reusability of DEJA VU for new applications, it seems important to

define an order description language from which the system can automatically
generate the order class. Although the logic behind this class is simple the con-
struction is error-prone.
At the moment, only a very simple temporallogic is used to describe the tem-
poral constraints between operations of one job. Since we use only before and
after-relations, we cannot express any possible constellation of operations. The
temporal consistency mechanism incorporated into the system is based on this
simple model. Using the full expressiveness of Allen's interval algebra (Allen
1983) for the consistency mechanism would be computationally too expensive
(NP-complete), but it seems tractable to apply it in describing the temporal rela-
tions of process plans.
The most important extension however, will be the introduction of reactive
scheduling. The main problem for the application at Böhler is the daily work with
the adaptation of the schedule to react 011 unexpected events such as new orders,
machine break-downs, destroyed products, etc. Based on (Dorn, Kerr, and Thal-
hammer 1995), we have already built a reactive scheduling prototype for Böhler
which shall be integrated into DEJA VU. Since this prototype has worked in a sim-
ulation model we must now test it in areal domain.
A documentation of the scheduling class library is publically available at:
hup ://www.dbai.tuwien.ac.atlprojlDejaVulDocument.
6 REFERENCES
Allen, J.F. (1983) Maintaining Knowledge about Temporal Intervals, CACM 26

(11), pp. 823-843.
Bylander, T. and Chandrasekaran, B. (1988) Generic Tasks in Knowledge-based
Reasoning: The 'right' Level of Abstraction for Knowledge Acquisition, in
Knowledge Acquisitionfor Knowledge-Based Systems, B. Gaines & J.
Boose (eds), pp. 65-77, London: Academic Process.
Dorn J. and Slany, W. (1994) A Flow Shop with Compatibility Constraints in a
Steel making Plant in Zweben and Fox(eds) Intelligent Scheduling, Morgan
Kaufmann, pp. 629-654.
Dorn, J. and Girsch, M. (1994) Genetic Operators Based on Constraint Repair,
ECAI'94 Workshop on Applied Genetic and other Evolutionary Algorithms,
Amsterdam, August 9.
Dorn, J. (1995a) Iterative Improvement Methods for Knowledge-based Scheduling
AICOM Journal, pp. 20-34 March.
Dorn, J. (1995b) Case-based reactive scheduling in Roger Kerr and Elisabeth
Szelke (eds) Artificial Intelligence in Reactive Scheduling, London:
Chapman & Hall, pp. 32-50.
Dorn, J. Kerr, R. M. and Thalhammer, G. (1995) Reactive Scheduling - improving
the robustness of schedules and restricting the effects of shop floor distur-
bances by fuzzy reasoning, International Journal on Human-Computer
Studies 42, pp. 687-704.
Dorn, J. and Shams, R. (1996) Scheduling High-grade Steel Making IEEE Expert
February, pp. 28-35.
Dorn, J., Girsch, M., Skele, G., and Slany, W. (1996) Comparison of Iterative
Improvement Techniques for Schedule Optimization, European Journal on
Operational Research.
7 BIOGRAPHY
Jürgen Dorn received his M.S and Ph.D. degrees in computer science from Tech-
nische Universität Berlin, Germany. From 1989 to 1996 he has headed the Knowl-
edge-based Scheduling group of the Christian Doppler Laboratory for Expert Sys-
tems in Vienna. Currently he works as Ass. Prof. at Technische Universität Wien,
Austria. His research interests include real-time planning, knowledge-based
scheduling, case-based reasoning, and software engineering.
Mario Girsch received his M.S. in computer science from Technische Univer-
sität Wien. He has worked since 1995 for the Christian Doppler Laboratory for
Expert Systems in Vienna. His interests are in knowledge-based scheduling,· case-
based reasoning, and genetic algorithms.
Nikos Vidakis received his B.Sc .. (Hons) degree from University of Northum-
bria at Newcastle (England) and the Ph.D. degree from Technische Universität
Wien. He has worked from 1994 to 1996 for the Christi an Doppler Laboratory for
Expert Systems in Vienna. His interests are in tools for developing user interfaces.
INDEX OF CONTRIBUTORS
Abdul-Hamid, Y.T. 279 Hvolby, H.-H. 218,291 Riis, 1.0. 218,230,327

Araki, M. 435 Roistadäs, A. 3
Aulia, A 303 Itoh, T. 29
Scherer, E. 206
Bartolotta, A. 195 10hansen, 1. 327 Schönsieben, P. 243
Biennier, F. 91 Schrijver, R.LJ. 103
Breithaupt, J.-W. 351 Katsikas, T. 148 Schwarze, S. 243
Brinkmeier, B. 183 Kawakami, K. 435 Sebaaly, M.F. 375
Bunce, P. 43 Kise, H. 455 Segawa, T. 341
Knopp, 1. 230 Shin, H. 399
Carrie, AS. 115 Kochhar, A.K. 279 Shiota, M. 387
Cheng, J. 455 Kojima, M. 315 Smeds, R. 327
Cimander, B. 267 Kuroda, M. 399 Storch, R.L. 79
Clave, F. 148 Sugimura, N. 411
Limoges, R. 43
de Haas, H. 218 Luczak, H. 136 Takata, Y. 67
Dean,I. 115 Tamaki, H. 435
Denat, J.P. 91 Ma,D. 363 Tamura, H. 303, 423
Dorn,J. 467 Manabe, S. 387 Tatsiopoulos,I.P. 148
Doumeingts, G. 18 Marimin 303 Tatsuta, Y. 67
Ducq, Y. 18 Matoba, H. 341 Trienekens, J. 291
Mikkelsen, H. 327
Elejabarrieta, J.B. 163 Morita, H. 67,341 Ueda, K. 55
Enomoto, M. 341 Moriwaki, T. 411 Umano, M. 303, 423
Mukai, T. 435
Favrel,l. 91 Murayama, T. 363 Vaario, 1. 55
Fujii, S. 67 van den Berg, R.J. 103
Fujimoto, H. 375 Nakashima, K. 315 Verweij, M.J. 171
Nishiyama, T. 423 Vidakis, N. 467
Garetti, M. 195
Girsch, M. 467 Oba, F. 363 Wiendahl, H.-P. 351
Ohno, K. 315 Wildemann, H. 129
Hase,H. 445 Okabe, T. 43 WiIliamson, M. 79
Hatono, I. 303, 423 Okino, N. 445
Herlina, L. 303 Olhager, J. 267 Yoshikawa, H. 13
Hornung, V. 136 Oster, M. 136
Hozumi, K. 411 Zülch, G. 183
Hübner, H. 255 Pels, H.J. 103 Zwegers, A.J.R. 103,171
KEYWORD INDEX
Abduction 29 Distributed
Advanced manufacturing systems 43 production 163
Agent based systems 103 real-time scheduling 423
Agile manufacturing 67, 115 simulation 423
Agility 43 Dynamic configuration 55
AGV 455
Ecological quality 255
APC 351
Enterprise
Assembly system 279
modelling 18
Automated Guided Vehicle (AGV) 445
types 115
Automatic production control 351
Exploratory study 267
Autonomy 206
Extended enterprise 18
Autonomous scheduling 399
Flexible assembly 375
Behaviour based control 91
Flow type production 67
Benchmarking 129, 136, 148
Flowshop scheduling 455
Biological manufacturing system 55
FMS 455
Branch-and-bound method 455
Formal specifications 91
Business process management 129
Fractals 43
Capability for rapid change 327 Frame-tree knowledge representation 303
Case study 218 Functional knowledge 243
Centralized and decentralized tendencies 218 Fuzzy inference 455
Collaborative engineering 79
Gantt chart 445
Collective genius 29
Genetic algorithm 375,435
Concept engineering 29
Geometric Gantt Chart (GGC) 445
Concurrent engineering 29,375
Configuration of multiple-variant products 243 Heterarchical control 103
Continuous Heuristic approach 303
improvement 230 High volume flexible manufacturing system 67
model 351 Holonic manufacturing system 411
reorganization 183
Implementation of production management 230
Control
IMS 243
architecture 103
Influential factors 136
structure 171
Information technology 3
Customer
Integrated production control 363
orientation 243
Integration 18, 163
relations 291
Intelligent
Decentralization 206 CIM 341
Decision trees 279 manufacturing system 55
Dematerialization 255 systems 43
Design strategies 171 Intranet 29
Dispatching rule 399 Iron and steel industry 387
482 Keyword index
Just-In-Time production system 315 modeling 243

-related service 255
"Lean" product 255
Production
Loading 363
concepts 291
Logistics 136, 351
control systems 291
Man-machine cooperative processes 387 management 3,18,171,183,267
Manufacturing 3,279 systems design 267
strategy 267 model 351
systems engineering 195 planning 363
Measures 136 redesign 171
Modeling 3, 183 scheduling 387,435,445
of manufacturing systems 195 Productivity 3
Models for control 218 Project management 79
MRP 341
Re-engineering 115
MRP-3 163
Reactive scheduling 341
Multi
Real time scheduling 411
-objective optimization 435
Recognition of pattern 129
-project management 230
Resource efficiency 255
Neural network 399 Robustness 91
Object Scheduling 163,363,467
design 18 Self-organization 55, 206
-oriented Semiconductor manufacturing 399
model 411 Service-oriented technology 29
modelling 195 Shop floor
OKP 163 control 103
Optimization 315 management 206
Organizational layout 55
leaming 129,327 Simulation 183,411
structures 183 games 327
Parallel-serial configuration 67 Soap industry 303
Pareto-optimal solution 435 Soft constraints 467
Performance Software
analysis 129 packages 18
evaluation 315,423 reuse 467
measurement 129 Steel manufacturing 467
modelling 148 Structured knowledge 279
Planning 163 Systematic knowledge acquisition 303
and scheduling 375 Teams 206
Plastics forming plant 435 The dynamic nature of production management
PPC 351 327
Process
US marine industry 79
benchmarking 129
orientation 183 Virtual
Product benchmarking 136
complexity/market uncertainty grid 115 enterprise 79
development strategy 303 production system 423

(IFIP — the International Federation for Information Processing) Asbjørn Rolstadås (Auth.), Norio Okino, Hiroyuki Tamura, Susumu Fujii (Eds.)-Advances in Production Management Systems_ Perspectives An

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(IFIP — the International Federation for Information Processing) Asbjørn Rolstadås (Auth.), Norio Okino, Hiroyuki Tamura, Susumu Fujii (Eds.)-Advances in Production Management Systems_ Perspectives An

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Advances in Production

Visit the IT & Applled Computing resource centre

IFIP's mission is to be the leading, truly international, apolitical organization which

IFIP is a non-profitmaking organization, run almost solely by 2500 volunteers. It operates

IUI'I SPRINGER-SCIENCE+BUSINESS MEDIA, B.V.

© 1998 Springer Science+Business Media Dordrecht

Thornson Science is a division of International Thornson Publishing I(DP'

ISBN 978-1-4757-4455-2 ISBN 978-0-387-35304-3 (eBook)

8 Printed on permanent acid-free text paper, rnanufactured in accordance witb

PART ONE Invited Articles

PART TWO Next Generation Manufacturing Systems and

PART THREE Benchmarking 127

25 Selection of assembly system configurations: adecision support system

40 Scheduling for an automated three-machine flowshop manufacturing system

Norio Okino Hiroyuki Tamura Susumu Fujii

TOPP is an industrially led researach program directed towards productivity

2 THE FUTURE PRODUCTIVITY PARADIGM

Productivity is a term usually associated with efficient resource utilisation, and

3 THE TOPP MODEL

TOPP has developed two sets of methodologies for measuring productivity in a

Figure 1 Performance measurement.

The self audit is performed by using a questionnaire which is answered by each

Figure 2 Company level-analysis areas.

Figure 3 Example of profile chart from TOPP external audit.

4 TOPP CONCLUSION AND RECOMMENDATIONS

7. The majority of the companies base strategie as well as operational management

In addition to these conclusions, 10 recommendations have been made for

Recommendations for industry

Recommendations for government agencies and institutions

Recommendations for universities and research institutions

Asbj!llrn Roistadäs is professor of production and quality engineering at the Faculty of

1-14-13-918 Tsukijima, Chuo-ku, Tokyo 104, JAPAN

Any sphere of scholarship is made in the following ways:

Advances in Production Management Systems N. Okino, H. Tamura & S. Fujii (Eds.)

From the standpoint of traditional natural philosophy, the disposition referred to

Deductive inference: inferring the results from rules and precedents

This can be easily understood instinctively if we consider this in terms of the

Rule: All the beans in this bag are white;

Here there is no worry about mistakes occurring with deduction.

Hiroyuki Yoshikawa received Bachelor of Engineering and Doctor of Engineering

2. THE DOMAIN OF THE PRODUCTION MANAGEMENT AND THE

After having described the various structures of Production Management, we will

2.1 The production management function in the enterprise.

In such an approach, the production management is considered as the interface

As an example of the description of the production system based on functions, there is

Figure 2 The CIMRU Architecture for Production Management System.

in~:~~ ~--,.__~____~ DECISION

Figure 3 The systemic approach of the production system

2.2 Tbe software tools to support the production management.

Today, in a modern manufacturing system, the use of software tools is necessary. At

3. EVOLUTION OF THE FUNCTIONS

4. THE ROLE OF ENTERPRISE MODELLING TECHNIQUES IN

The Enterprise Modelling Techniques (EMT) allows the representation of the

improved before its computerisation.

Figure 4 The GRAl model

5. EVOLUTION OF THE PACKAGES FOR PRODUCTION

The increasing of complexity of production management and the current progresses

5.1 The development of dient/server systems and the integration.

Figure 5 An example of c1ient/server architecture

5.2 Towards the Customisation of Production Management System.

5.3 The use of object oriented approach.

long time of implementation.

Guy Doumeingts is presently Professor at the University ofBordeaux 1, Director of

Advances in Production Management Systems N. Okino, H. Tamura & S. Fujii (Eds.)

in~:~~ ~--,.~__~ DECISION