Optimal Number of Cells for a Part Family in a Stochastic Demand Environment

Cellular manufacturing system is designed and evaluated according to its profitability under stochastic demand environment. In this paper, the methodology consists of five phases. First, the cellular system is studied through identifying information of processing time and demand for parts according to part-machine matrix and demand data. Then, the cellular system is configured or designed through the following steps: determining means, variance and standard deviation of capacity requirements for parts in family, determining demand coverage probabilities for part family and determining the expected cells utilization. Second, the expected revenues generated by the cellular design are determined. Third, the total expected costs of cells open for part family are determined considering different scenarios of the expected shortages of units. Fourth, the expected profits generated by cells open are determined and finally the decision is made regarding the optimal design that yields the largest profits with its associated demand coverage probability. The results show that although five manufacturing cells meet the expected demand of the part family, three manufacturing cells generate the highest profits for the system