Economies of scale achieved through mass production of a limited number of products has been the cornerstone of successful manufacturing throughout this century. For most industries, this strategy is rapidly becoming obsolete as the competitive emphasis shifts to producing an enormous variety of products at costs approaching the efficiency of mass production. This trend to variety competition is driven by many factors. This proposal describes a program of research to develop models and algorithms for designing the products in a product line and for designing and managing the production process in an environment of high product variety. The first component of our research is concerned with developing detailed sequencing models and algorithms appropriate for managing the mixed-model transfer lines that will soon become the dominant production process for automobiles. The second component is developing strategic planning models and algorithms that integrate product planning, technology choice and design of production lines.
