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A COMPARISON OF DIRECT COST SAVINGS BETWEEN FLEXIBLE AUTOMATION AND LABOR WITH LEARNING
Author(s) -
Smunt Timothy L.,
Meredith Jack
Publication year - 2000
Publication title -
production and operations management
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 3.279
H-Index - 110
eISSN - 1937-5956
pISSN - 1059-1478
DOI - 10.1111/j.1937-5956.2000.tb00331.x
Subject(s) - forgetting , automation , production (economics) , computer science , labor cost , operations research , operations management , economics , industrial engineering , microeconomics , engineering , mechanical engineering , philosophy , linguistics
This paper compares flexible automation with labor‐intensive manufacturing processes in a batch production environment and considers learning, forgetting, inventory carrying costs, setup costs, production demand volume, previous production experience, and the proportion of material to labor cost. While flexible automation typically can reduce setup times, and therefore inventory carrying costs through smaller optimal batch sizes, the results of this research show that the effect of forgetting on relative cost savings is difficult to predict in some situations. When using optimal lot sizes in both the automated and labor environments, cost savings from flexible automation may be smaller than expected or may occur in different ways than anticipated.