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M.I.M. Wahab1 , Desheng (Dash) Wu, Chi-Guhn Lee

Department of Mechanical and Industrial Engineering

University of Toronto, Toronto, Ontario, M5S 3G8, Canada

July 19, 2005

1 Corresponding

Abstract

Despite extensive studies on the flexibility of manufacturing systems over the last two

decades, a unified measurement approach has not been developed. In this study, we propose

a generic model to measure machine flexibility with consideration of the dynamic perspective

of manufacturing systems. To this end we integrate two streams of machine flexibility from

the literature: operational capability-based machine flexibility and time/cost-based machine

flexibility. The resulting framework to measure machine flexibility is a two-stage process: the

time/cost-based machine flexibility is measured using a super efficiency DEA (Data Envelopment Analysis) model and operational capability-based machine flexibility is incorporated

as the number of operations a machine can execute with a positive degree of efficiency.

Keywords: Machine flexibility; DEA (Data Envelopment Analysis); Super efficiency

Introduction

Flexibility in manufacturing systems has played an increasingly important role as firms try

to remain competitive in todays rapidly changing market. The ability to adapt to dynamic

market demands and ever shortening product life cycles is now a norm in many industries.

With flexibility, manufacturing firms are able to produce superior-quality, customer-oriented

products at a low cost and with a faster response to dynamically changing market conditions.

Changes that pose challenges to manufacturing systems include the deterioration and

failure of equipment, introduction of new sequencing or dispatching rules, customer demands,

and price and quality of supplies. While most of these changes are dynamic, the traditional

concept of flexibility is static and fails to address the capability of todays sophisticated

systems being able to respond to these changes (Hyun and Ahn, 1992; Pereira and Paulre,

2001).

Furthermore, most studies in the current literature have investigated the concept of flexibility in relation to a particular domain and a specific objective (Gerwin, 1987; Sarker et al.,

1994; Shuiabi et al., 2005) and hence are not free from various biases specific to their own

areas of interest (Koste and Malhotra, 1999). As a result, the meaning and implementation

of flexibility still remain ambiguous (Chang et al., 2001) and the current literature still lacks

exact analytical models capable of generating a clear relationship between the degree of a

systems flexibility and the level of a systems performance (Slack, 1987; Kumar, 1987; Gupta

and Goyal, 1989).

Among the various types of manufacturing flexibility that have been addressed in the

literature, machine flexibility is the most important and fundamental in that other types

of flexibility rely on the machine flexibility. As the machine flexibility increases, a machine

tends to be capable of performing a larger number of operations and hence gains a high level

of product mix flexibility, process flexibility, operation flexibility and routing flexibility.

Sethi and Sethi (1990) indicate that there are two components in machine flexibility: operational capability-based machine flexibility, and time/cost-based machine flexibility. Operational capability-based machine flexibility is expressed in terms of a set of operations from

a reference set that a machine can perform with a positive degree of efficiency, which could

reflect the machine-operation characteristics such as the costs and time for setting and resetting, and the costs and time of processing an operation (Brill and Mandelbaum, 1989; Chen

and Chung, 1996). The time/cost-based machine flexibility is expressed in terms of the time

and cost required to set up and reset up from one operation to another. Time/costs based

machine flexibility models have been studied by Taymaz (1989), and Chandra and Tombak

(1992). These two types of machine flexibility do not always agree and one has to deal with

the possibility of inconsistent dual measures for a single system. While this would allow for

the evaluation of the system from dual points of view in some cases, confusion may arise in

other cases.

Therefore, the aim of this paper is to develop a domain-independent framework to measure the dynamic flexibility of manufacturing systems. To this end, we propose to integrate

the two components of machine flexibility. The resulting framework consists of two stages:

an efficiency rating to capture time/cost-based flexibility and the number of operations that

a machine can perform to capture capability-based flexibility. The proposed model gives a

comprehensive machine flexibility measurement to evaluate and rank manufacturing systems

according to their inherent machine flexibility with consideration of the dynamic environ2

The paper is organized as follows. Section 2 first presents the proposed framework for

machine flexibility, and briefly discusses the basics of DEA. Then it presents a super efficiency

DEA model that determines the efficiency with which a machine can perform an operation

on a part and the machine flexibility model. Section 3 presents a numerical example. Finally

section 4 concludes the paper.

In this section, we first present the conceptual framework for the proposed machine flex-

ibility model and then describe the super efficiency DEA model that is used to compute the

efficiency of a machine. Finally, we present the machine flexibility model.

2.1

The framework

Chang et al. (2001) indicates that flexibility can be expressed in terms of capability and

capacity of machine, which is confirmed by Sethi and Sethi (1990). The capability can be

measured as the number of different types of operations that a machine can perform, while

the capacity is defined by the cost and time required to configure a machine for different

types of operations (Slack 1983). Therefore, the flexibility of a machine can be expressed as

a function of the set of operations, time, and cost for reconfiguration. That is

Flexibility = function of {Capability, Capacity},

Capability = function of {Range of operations},

Capacity = function of {Time, Cost}

(1)

Therefore,

Flexibility = function of {Range of operations, Time, Cost}.

These simple relations lead us to a generic model, where the range of operations (or simply

range) is expressed in terms of the number of operations that a machine can perform, and

the time and cost are expressed in terms of operational efficiency. The proposed framework

consists of two stages, as illustrated in Figure 1. The first step, focusing on time/cost-based

machine flexibility, is to express the costs and time required to configure a machine and

to process operations as an efficiency measure using a super efficiency DEA model. The

second step is to incorporate the operational capability-based flexibility as the number of

operations a machine can execute with a positive efficiency. Technological attributes such as

the importance of an operation and probability distributions for demand are considered.

The super efficiency DEA model employed in this paper has four inputs and one output.

The inputs include processing cost (in $), processing time (in minute), setup cost (in $) and

setup time (in minute), and the output is the importance of operations. The model aims to

minimize the inputs (cost and time) subject to attaining the desired output levels. Now, we

will present a brief introduction of the basic concepts of DEA and present the super efficiency

model that is used to compute the efficiency.

INSERT FIGURE 1 HERE 4

2.2

set of observed units, or decision making units (DMUs), and to identify the units that are

inefficient as compared to the best-practice group. A DMU can be any activity, or entity,

such as a school or an enterprise, where multiple inputs are consumed to generate multiple

outputs. DEA also indicates the magnitude of the inefficiencies and possible improvements

for the inefficient DMUs. Consider n DMUs to be evaluated, in which DMUj (j = 1, 2, . . . , J)

consumes the amounts Xj = {xij } (i = 1, 2, . . . , I) and produces the amounts Yj = {yrj }

(r = 1, . . . , R). We now refer to the BCC DEA model by Banker et al. (1984):

min

{0 ,,s+ ,s }

s.t.

0 1 s+ 1 s

(2)

Y s+ = Y0

0 X0 X s = 0

1 = 1

, s+ , s 0,

where s+ and s are the slacks in the system; is a J-dimensional vector and 0 is a scalar,

and both are decision variables.

In the above model, the objective is to minimize the decision variable 0 , which is defined

as the proportional reduction of all inputs for DMU0 that will move it onto the frontier, or

the envelopment surface defined by the efficient DMUs in the sample. The first and second

constraints define the envelopment surface constructed by the virtual DMU (X, Y ),

where X and Y are input and output matrices respectively. The convexity constraint ( 1 =

1) is also a normalization constraint that allows variable returns to scale in the model.

Performing a DEA analysis requires the solution of n linear programming problems of the

above form, one for each DMU. The optimal value of the variable 0 indicates the proportional

reduction of all inputs for DMU0 . A DMU is deemed efficient if and only if the optimal value

0 is equal to 1 and all the slack variables are zero. The dual of the above formulation is:

max{,} T Y0 + u0

s.t.

(3)

T X0 = 1,

T Y T X + u0 1 0,

T 1 ,

T 1 ,

u0 unrestricted.

If the convexity constraint ( 1 = 1) in (2) and the variable u0 in (3) are removed, the

feasible region is enlarged, which results in the reduction of the number of efficient DMUs,

and all DMUs are operating at constant returns to scale. The resulting model is referred to

as the CCR model (Charnes et al., 1978).

Two interrelated problems that have been widely recognized with the above DEA models

are weak discriminating power and unrealistic weight distribution (Li et al., 1999). The

problem of weak discriminating power occurs when the number of DMUs under evaluation

is not large enough compared to the total number of inputs and outputs. In this situation,

classical DEA models (e.g., CCR model by Charnes et al., 1978; and BCC model by Banker

et al., 1984) often yield solutions that identify too many DMUs as efficient.

In order to improve DEAs discriminating power, we take two measures. The first is to

6

adopt a super Efficiency DEA model, which will be discussed later in this section, and the

second is to appropriately define a DMU in a manufacturing system so that enough DMUs

can be generated for meaningful computation.

In a flexible manufacturing system, an operation on a part can be performed on more

than one machine depending on the state (e.g., up or down; busy or idle) of machines in the

system that can do the same operation. It must be noted that each machine may perform

a particular operation with a different degree of efficiency. Therefore the flexibility of the

system depends on which operation is assigned to which machine. It is obvious that the

assignment of an operation must be made in real time so as not to interrupt the continuous

operation of the whole system and to ensure the resulting performance of the assignment. It

seems natural that a DMU is defined by a machine, an operation, or a part that needs to be

assigned. A potential problem with this definition is that all the DMUs can be considered

efficient due to the lack of a sufficient number of DMUs. Thus, we propose to define a DMU

for every possible combination of a machine, an operation and a part. As a general rule of

thumb, three DMUs are needed for each input and output variable used in the model in order

to ensure sufficient degrees of freedom for a meaningful analysis. If less than three DMUs per

variable are included in the data set, there is the danger that an excessive number of DMUs

will be considered efficient (receive a score of one) due to an inadequate number of degrees of

freedom. This would heavily undermine the diagnosing power of the DEA. It is noted that

the techniques of weight restriction (e.g., constant bounds (Dyson and Thanassoulis, 1988),

assurance region (Thompson et al., 1986), and cone-ratio (Charnes et al., 1990)) can not

be adopted here to improve DEAs discriminating power because no additional constraint

can be derived from the input and output parameters used in our DEA model. That is, we

7

cannot introduce constraints that are not present in the actual manufacturing system.

Let Ximlk be the i-th input variable of DMUmlk with machine m (m=1, 2, . . . , M ), part l

(l=1, 2, . . . , L) and operation k (k=1, 2, . . . , K). Similarly, Yrmlk refers to the r-th output of

DMUmlk . Let X = {Ximlk }(IM LK) and Y = {Yrmlk }(RM LK) represent the input and

output matrix, respectively. The output oriented efficiency of a particular DMUmlk under

the assumption of variable returns to scale (VRS) can be obtained from the following linear

program (Andersen and Petersen, 1993).

min

{mlk ,,s+ ,s }

s.t.

emlk = mlk 1 s+ 1 s

(4)

Y s+ = mlk Y mlk

X mlk X s = 0

0 = 0

1=1

, s+ , s 0

The mathematical formulation of the super efficiency (SE) model removes the column

of the unit being scored (DMUmlk ) in order to obtain individual reference functions for the

efficient observations. Note, however, that the results for the standard model can always be

recovered from the SE scores by setting all scores greater than one to unity. Figure 2 depicts

this idea, where there are 2 inputs (processing cost and time) and 1 output (importance of

operation). Five DMUs are indicated by A, B, D, C, and E.

INSERT FIGURE 2 HERE

Inefficient DMUs are treated in the same way with the super efficiency DEA as with the

8

standard DEA model. It is in dealing with efficient DMUs that makes the two approaches

different. In the standard DEA model shown in Figure 2, A, B, C and D dominate and

hence they are their own reference points and receive an efficiency score of 1.0 (100%),

leaving E to be the only inefficient DMU. The point G, a linear combination of the observed

efficient combinations C and D, is the nearest neighbor of E on the piecewise linear frontier

A-B-C-G-D. According to the standard model the reference point of B is B itself, with an

efficiency score equal to OB/OB = 1.0. In the super efficiency DEA analysis, the efficiency

of B is determined with the reference set after excluding B, as illustrated in Figure 2. The

elimination of B compares B with the input frontier spanned by the remaining set of efficient

observations (A, C, D in the example shown in Figure 2). That is, the reference point for

evaluating the efficiency of B is H, which is a linear combination of A and C, and the efficiency

score of B is OH/OB, which is larger than one. This efficiency score reflects the maximum

proportional increase in inputs to maintain efficiency.

The dual of the super efficiency DEA given in (4) is

max{,} wmlk = T Y mlk + u0

s.t.

(5)

T X mlk = 1

T Y j T X j + u0 1 0, j = 1, 2, . . . , M L K

T 1

T 1

u0 unrestricted.

After computing the super efficiency (SE) score for a DMU, we can normalize the efficiency scores so that all the scores should be between 0 and 1. That is, the efficiency is

9

emlk =

2.3

emlk

maxm maxl maxk (emlk )

(6)

Now recall the framework in which flexibility is expressed as a function of the range of

operations, costs and time (see (1)). Capability is expressed in terms of range, and capacity

is expressed in terms of cost and time. Notice that the previous subsection provides a super

efficiency DEA model to express the capacity in terms of costs and time, which includes

processing time and cost, and setup time and cost. Now we combine the efficiency and

the capability, where capability is the number of operations a machine can perform with

a positive degree of efficiency, and develop the machine flexibility model that incorporates

both capability and capacity.

Let Tl be a set of operations that part l requires, and let Tm be a set of operations that

machine m can perform. We define lm to capture the processing capability of machine m

with respect to part l, which is given by

X

lm =

where

Zmlk =

Zmlk

k{Tl Tm }

|Tl Tm |

(7)

0 otherwise.

may not be possible to assign all possible parts that can be performed by a particular machine

because of internal (e.g. deterioration and failure of machines and tools, implementing

10

different sequencing or dispatching rules) and external (e.g., customer demand uncertainty,

supply uncertainty) uncertainties in the system. Thus, it is noted that when a manufacturing

system behaves dynamically the assignment of a part to a machine is uncertain. Thus, let

plm be the probability of part l being processed by machine m, which is given by

lm

,

max lm

plm = pl

(8)

m{1,2,...,M }

where pl denotes probability of demand for part l. Now we incorporate the efficiency of a

machine to process an operation on a part in the system. Let emlk be the efficiency, which

is computed using the super efficiency DEA model, of machine m for processing operation k

on part l, such that 0 emlk 1. We also let wk , 0 wk 1, be the weight of importance

of operation k and

P

k

wk = 1.

M Fm =

L

X

K

X

plm

l=1

wk

k{Tl Tm }

emlk

.

|Tl Tm |

(9)

The measure of the machine flexibility of a manufacturing system which has M machines is

given by

SM F =

M X

L

X

m=1 l=1

K

X

plm

k{Tl Tm }

wk

emlk

.

|Tl Tm |

(10)

and develop a generic machine flexibility model. We model machine flexibility as a function

of the number of operations that a machine can perform with a positive degree of efficiency,

the cost and time of processing, setting up and resetting up, the weight of importance of an

operation, and the probability of demand for a part. This model integrates two components

of machine flexibility from the existing literature: operational capability-based machine flexibility, and time/cost-based machine flexibility. To our knowledge, no existing model presents

11

a complete measure of machine flexibility that models the setup and re-setup costs and time,

and processing costs and time as an efficiency measure, and then integrates this with the

operational capability-based measure of machine flexibility. Moreover, the proposed model

can also be used to measure the machine flexibility of a conceptual system at the design stage

as well as an existing system in operation. This is because, for the given set of machines and

parts, the data used in the model can be estimated at the design state and does not require

measurement of an existing system.

Numerical Illustration

The purpose of this section is to present a numerical example using the proposed model

system that consists of four CNC machines, M1 , M2 , M3 and M4 to process four part types,

P1 , P2 , P3 and P4 . The operations required by each part and the probability of demand

for each part are given in Table 1. The type of operations that each machine can perform

and the weights of importance of each operation are given in Table 2. In these tables, 1

indicates that the part requires the particular operation or the machine can perform the

particular operation, and 0 otherwise.

- [insert table 1 here]

- [insert table 2 here]

Setup cost, setup time, processing cost, and processing time for each operation and part

type on each machine are given in Table 3. All the costs are in dollars and time is in minutes.

12

This information captures all possible alternative machines for a particular operation on a

particular part type in the system. For example, when operation O2 on part P2 is assigned

to machine M1 , it incurs setup cost of $4.2, processing cost of $36, and it requires setup time

of 1.6 mins and processing time of 17.7 mins. In Table 3, 0 values of costs and time indicate

that the particular operation of a part can not be processed on a particular machine or the

particular operation is not required by a part. These costs and times are used as inputs, and

the weights of importance of each operation are used as outputs in the super efficiency DEA

model to compute the efficiency of a machine used to process an operation on a part.

- [insert table 3 here]

There are 4 4 4 DMUs that represent different combinations of machines, parts,

and operations. To calculate the efficiency scores of different combinations of machines,

operations and parts, we first drop the combinations with zero value since their efficiencies

are obviously 0. In our case, we drop 31 combinations so that the remainder are those with

positive values. The rest are then used for running DEA model (4) or (5). Table 4 presents

efficiency scores of these combinations (DMUs). For example, the efficiency of machine M1

to process the operation O1 on part P1 is 0.678 as given in the first cell of Table 4. Note

that the efficiency scores in Table 4 are already normalized by using equation (6).

- [insert table 4 here]

- [insert table 5 here]

- [insert table 6 here]

13

From Tables 1 and 2 the values of lm are computed using equation (7) and given in

Table 5. For example, the value of 41 is 0.67 or (2/3). Then the probability of assigning a

part to a machine is computed using expression (8) and given in Table 6. For example, the

probability of assigning part P3 to machine M1 is 0.125 or (0.25 0.5/max{0.5, 1, 0.5, 0.5}).

By using the proposed model, the value of machine flexibility of machine M1 is 0.0805 or

((0.678 0.3 + 0.433 0.2)/2) 0.1 + ((0.532 0.3 + 0.387 0.35)/2) 0.15 + ((0.453 0.35 +

0.539 0.2)/2) 0.125 + ((0.399 0.35 + 0.391 0.2)/2) 0.25). Similarly, the values of

machine flexibility of machines M2 , M3 , M4 are 0.0866, 0.0695 and 0.0554 respectively. The

system machine flexibility is 0.292.

Conclusions

This paper proposes a domain-free framework to measure machine flexibility with con-

this end, we consider uncertain demand in our model. The contribution of this paper is

two-fold. First, two main streams of existing machine flexibility models are integrated to

develop the generic model. Second, the super efficiency DEA model is employed to compute

the efficiency that a machine can perform an operation on a part.

The proposed framework may be a useful tool in evaluating machine flexibility and ranking manufacturing systems. To be more practical, several aspects need to be incorporated

in the future: properties of raw materials that the machine can handle, dimensional range

that the machine can produce, and characteristics of parts in shape, weight, and material

properties. The framework proposed in this paper may have advantages over others in the

14

References

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envelopment analysis models with an illustrative application to large commercial banks.

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15

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Koste, L.L., Malhotra, M.K., 1999. A theoretical framework for analyzing the dimensions

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Kumar, V., 1987. Entropic measures of manufacturing flexibility. International Journal of

Production Research 25, 957-966.

Li, X.-B., Reeves., Gary, R., 1999. A multiple criteria approach to data envelopment

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Pereira, J., Paulre, B., 2001. Flexibility in manufacturing systems: A relational and a

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16

Sarker, B.R., Krishnamurthy, S., Kuthethur, S.G., 1994. A survey and critical review of

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Shuiabi, E., Thomson, V., Bhuiyan, N., 2005. Entropy as a measure of operational flexibility, European Journal of Operational Research 165, 696-707.

Slack, N., 1983. Flexibility as a manufacturing objective. International Journal of Operations and Production Management. 3 (3), 4-13.

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17

Table 1: Type of operations required by each part and weight of importance of each operation

Parts

Operations

Probability of demand

O1

O2

O3

O4

P1

0.2

P2

0.3

P3

0.25

P4

0.25

18

Machines

Operations

O1

O2

O3

O4

M1

M2

M3

M4

Weight

19

20

23

9

P2

29

9

P2

1

35

0

0

0

0

P1

2.5

1.2

39

3

1.5

46

M2

setup cost($)

M3

setup cost($)

P1

P1

M4

setup cost($)

0

0

P3

P3

P3

P3

33

1.6

5.3

1.3

4.3

P2

1.2

setup cost($)

P2

P1

M1

O1

P4

P4

P4

P4

P1

P1

P1

P1

29

0.5

2.5

P3

18

0.8

1.7

P4

22

0.8

3.5

P1

24

0.4

2.1

P3

15

1.2

2.5

P4

29

3.9

P1

24

0.5

2.1

P3

13

0.8

P4

P2

P3

P4

44

1.9

5.2

P2

14

25

0.6

3.1

P1

P1

39

1.9

4.8

P2

36

1.6

4.2

P2

O2

P2

P2

P2

P2

26

1.2

1.6

P3

20

0.6

2.8

P4

P1

27

17

0.5 0.8

2.4 2.4

P4

P1

28

0.7

2.8

P2

P2

O4

19

1.3

P3

P3

8.9

29

1.2

1.6

P3

P3

2.9

P1

12

0.5

2.2

P1

14

6.9 6.1

25

0.6 0.9

P4

P4

15

32

2.2

3.7

P2

12.3

26

0.8

P2

7.9

22

1.1

1.5

P3

24

1.2

1.9

P3

31

1.4

1.9

P3

10.5 5.4

O3

Table 3: Setup cost and time, and processing cost and time for each operation of a part in each machine

P4

P4

P4

P4

21

0.441 0.351

M4

0.544 0.521

0.678 0.532

P2

M3

M2

M1

P1

O1

P3

P4

P1

P3

P4

P1

0.546

P2

O2

P2

P4

0

P1

0

P2

O4

0

P3

1.00

0.553 0.496

0.539 0.391

P3

O3

P4

Table 5: Values of lm

Machines

Parts

M1

M2

M3

M4

P1

P2

P3

P4

22

Machines

Parts

M1

M2

M3

M4

P1

P2

P3

P4

23

24

25

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