STRATEGIC PLANNING FOR THE OPTIMAL ACQUISITION OF FLEXIBLE MANUFACTURING SYSTEMS TECHNOLOGY (FMS, STRATEGY, CONTROL THEORY, OPERATIONS MANAGEMENT, DECISION SUPPORT

The purpose of this research is threefold: First, a conceptual framework is presented depicting linkages among corporate, business unit, and manufacturing strategy from which the potential contribution of flexible manufacturing systems technology is further elucidated. Second, two normative dynamic decision models are introduced to assist firms in strategic planning activities concerning the development of a manufacturing process technology strategy. These models capture salient features corresponding to the firm's competitive position over time and the relative impact of flexible automation on goal attainment. Third, through systematic variation of exogenous input parameters, each model's dynamic behavior is assessed under different environmental scenarios. The solution methodology is optimal control theory.;In Chapter 3, the general tradeoffs between the adoption of FMS technology and the more conventional, manually operated technology is explored. The model's objective is to derive the optimal, dynamic mix of flexible and conventional capacity. The multicriterion objective function defined in the model is to maximize the long-term effectiveness of the firm in supporting business unit goals minus relevant costs incurred over the planning horizon. Long-term effectiveness is modeled as the terminal time value of market share and capacity held by the firm minus the total penalty costs arising from deviations between actual and planned market share levels over time. Other relevant costs subtracted from the maximizing objective over the planning horizon include those related to production, capacity maintenance, purchases of flexible technology, and changes in the level of conventional capacity.;In Chapter 4, a related model is introduced which differs from that of Chapter 3 in several fundamental ways. First, the model addresses the issue of technological progress. It is assumed that increases in both the levels of demand and productive capacity beyond the time of initial acquisition occur as a result of cumulative experience with the flexible automation. Second, this model allows for the scrapping of existing productive capacity including vintage flexible technology. Third, demand in excess of the available operating capacity may be met through the use of short-term capacity expansion measures.