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manufacturing technologies:
Part I I - a methodology for
evaluation
SABAH U RANDHAWA and TOM M WEST
Justification methodology
Abstract: In Part I of this paper we provided a review of the
techniques used in the evaluation of automated manufacturing An overview of the proposed methodology is shown in
technologies. In this paper we provide a framework to integrate Figure I. The primary input classes are: a description of
the economic, technical, strategic, and qualitative factors in the the system to be analysed; operational requirements
investment decision. The framework is based on combining a and environmental restrictions; and management pre-
simulation model with a multi-attribute decision model. The ference structure reflected in the selection of attributes,
simulation model is used to estimate the operational and assessment of qualitative attributes, and in assessing
economic attributes for the investment problem. The multi-
the relative importance of attributes in the decision
attribute decision model is the linear additive scoring model
environment.
because of its ease of use and its ability to structure
multi-dimensional problems. The basic components of the system shown in Figure
1 include:
Keywords: automated manufacturing, implementation, justifi- (1) Attribute selection procedure: the decision environ-
cation, simulation, multiattribute evaluation, scoring models
ment is best described by a list of attributes or
characteristics. Therefore, the initial task in the
justification process is to develop a list of relevant
n Part I of this paper we developed a classification attributes for the situation being analysed. Some of
I scheme for CIM evaluation techniques and briefly
reviewed some of these techniques. It was pointed
out that evaluating investments in automated technolo-
these attributes will be quantitative (both economic
and non-economic) in nature; others will be
qualitative.
gies is a complex decision due to the large number of
attributes and their complex interactions. The task is (2) Simulation module: T h e simulation module is used
further complicated by the necessity of including the to obtain estimates for quantitative attributes, t h e
non-financial and qualitative aspects of manufacturing simulation module consists of three components:
performance. Due to these factors, no single modelling
(a) a resource library for describing the objects of
technique is adequate for analysing all aspects of the
the physical system (equipment, piece parts,
manufacturing evaluation. This paper describes a
etc.) and their interactions:
methodology based on integrating some of the tech-
(b) a library for decision strategies that describe the
niques discussed in Part I. The two techniques
policies for equipment layout, scheduling,
primarily utilized are simulation and scoring models. inventory control, etc.; and
The next section provides a brief overview of the
(c) a decision support library that contains models
justification methodology. This is followed by a
for estimating modelling factors such as fore-
detailed description of each component.
casts and economic parameters, and assisting in
the analysis of simulation output.
Department of Industrial and ManufacturingEngineering, Oregon An integral part of the simulation analysis is an
State University,Corvallis, Oregon97331, USA integrated capability for sensitivity and risk analysis.
0951-5240/92/040276-07 (~ 1992 Butterworth-Heinemann Ltd
Qualitative
attributes
_•
System description scores
Operational requirements Develop J - Ranked
Management preferences
Quantitative +
qualitative
attributes
attribute
weights
Attribute
weights
r°
sensitivity
analysis
I ~-- ordered
alternatives
(3)Strategic evaluation module: this module uses possible significant impact and familiar with the
management's judgement and evaluation to operational and other technical specialties should be
(a) develop estimates for qualitative attributes, and asked to contribute ideas. The experience of these
(b) develop attribute weights, or relative import- experts should augment the literature review process,
ance of the attributes in the decision environ- and help to minimize any omissions and duplication
ment. among attributes. Additionally, a simple model-
building approach, in which by building a model of the
(4) Multiattribute evaluation module: this module per- manufacturing problem and identifying relevant input
forms two functions: and output variables, suitable attributes may be
(a) computing the aggregate score for each manu- identified, can be used in the attribute identification
facturing alternative consisting of total weigh- process. A list of typical attributes for a CIM
ted attribute values for an alternative, and application is shown in Figure 2.
(b) Performing sensitivity analyses on attribute There is no one best set of attributes. The attributes
weights and attribute values. chosen to serve as a basis of comparison are dependent
on the characteristics of the specific manufacturing
The output from the system is a set of measures for
each manufacturing alternative. The measures reflect environment. However, it is generally desirable to keep
the attribute set as small and concise as possible.
the performance of an alternative with respect to the
Additionally, it is necessary to make every attribute
defined attributes, and incorporate tradeoffs among
mutually exclusive of every other attribute. There are
attribute weights and attribute values.
primarily two reasons for keeping the attribute set to a
minimum. First, most of the available techniques for
Attribute selection procedure combining the impact of attributes assume independ-
A manufacturing alternative is defined by a particular ence or near independence among attributes. This
collection of attribute values. The development of a list implies that the attributes should be mutually exclusive
of relevant attributes may be as simple or as extensive to avoid double counting of impacts. In practice, it is
as the analyst wishes. Often this activity is physically often impossible to obtain an independent set of
limited by the time and resources available. It is always attributes. However, independence is easier to justify
desirable to thoroughly consider all the attributes in the and approximate with a smaller attribute set than with a
decision environment. However, the time and effort larger set. Correlation among attributes may be
required for such complex analyses are usually minimized by using statistical techniques such as factor
prohibitive, and it is often possible to reduce the analysis. Second, a large number of attributes require
dimensionality of the problem without a significant loss considerable effort in obtaining attribute values for
of information and accuracy. A multistep iterative each alternative.
procedure is usually used to identify relevant attributes. Additional attribute sets for analysing manufacturing
The procedure starts by identifying an initial set of environments are given elsewhere 1-5. A procedure for
attributes through literature search and questionnaires, identifying attributes and minimiz!ng duplications
and developing operational definitions for the attri- through factor analysis is given in Randhawa and
butes identified. Persons knowledgeable in the areas of Bedworth 2.
The other two libraries represent conceptual con- analysis. In the majority of evaluation techniques which
structs. The decision strategies library contains alterna- consider parameter variability, the system is first
tives for equipment layout, sequencing, scheduling, analysed using deterministic values. Sensitivity analyses
and similar physical attributes. The decision support are then performed on the base model through equally
(or model) library contains a set of analytical models to likely variations in attribute values to identify the more
be used in forecasting, economic evaluation, inventory critical attributes in the system. This is followed by risk
management, and analysing simulation output, and analysis or dermining the probability distributions
constructs required for executing simulation such as associated with outcomes of critical attributes. These
random number generators and event schedulers (for resulting distributions describe the variability associ-
generating and controlling the execution logic). ated with these attributes 6. Irrespective of the evalua-
The framework of Figure 3 shows a modular tion technique, advanced sensitivity and risk analyses
structure, independent of the implementation tech- generally require some form of simulation analysis.
nique. Thus, manufacturing alternatives to be analysed In simulation analysis, the variability associated with
can be constructed by selecting components from the input parameters (costs, product demand, economic
resource library, and interfacing these components indicators such as interest and inflation rates, and
using conceptual constructs from the decision strategies machine performance parameters including capacities
and decision support libraries. and rates) are defined in terms of probability distri-
An advantage of using simulation is that sensitivity butions; the variance or the standard deviation of the
and risk analyses are integral components of the output measures then indicate the degree of uncer-
analysis, rather than representing 'post-optimality' tainty of risk associated with predicting the final result.
Determining distributions for input parameters
depends on available information. If adequate histori-
cal data are available, then a standard distribution may
be fit to this data and verified using 'goodness-of-fit'
Resource Library tests. If no standard distribution fits the observed data,
Workstations then the factor may be modelled using an empirical
Processing Stations
Machining distribution computed from existing or synthesized
Drilling data. If no system data is available, as is not uncommon
Turning in evaluating new systems, a triangular distribution
with a minimum, maximum, and most likely value may
Transfer Stations be used 7. The triangular distribution recognizes the
variability of data, and is easy to use as the parameters
Storage Queues (Buffers) may be estimated based on input from system experts.
Material Handling In general, if an objective or subjective distribution
Robots could be fit, this is preferable. Distributions allow
Conveyors 'extreme events' to be generated which fall outside the
AGVs range of observed data. Extreme events while rare
often may have a significant impact on the design of the
Storage/Retrieval system.
AS/RS In addition to sensitivity and risk analysis, certain
important characteristics such as flexibility associated
Entities with advanced manufacturing technologies can be
Raw Material evaluated using simulation. Different types of flexi-
bility may be associated with a manufacturing system8.
Finished Products These include process flexibility, product flexibility,
volume flexibility, and expansion flexibility. Although
Decision Strategies Library
all forms of flexibility are hard to quantify, the effect on
Equipment Layout economic and non-economic attributes can be incor-
Sequencing (or Routing) Policies porated in the simulation analysis by designing and
Scheduling Policies analysing different scenarios.
Inventory Control Strategies