Measuring the economic effectiveness of flexible automation: a new approach

SUMMARY

This paper outlines a method for the evaluation of flexible manufacturing systems (FMS), which considers both economics and strategic aspects. The firm strategic position, in fact, is turned into a few performance indicators, each expressed numerically. The manufacturing system must perform within given values of these indicators, which act as constraints. Then connections between the cost of obtaining strategic performances and the flexibility of the manufacturing system are defined; this allows one to express net cash flows, used to compute profitability, as a function of the strategic position of the firm.

The simplifying assumptions used in implementing the method on a VAX/VMS are specified. A case study, concerning the application of the model to a leading Italian firm in the automotive industry, is briefly discussed.