Int. J. Production Economics 75 (2002) 305–322 The evolution of a cellular manufacturing system – a longitudinal case study Eric Molleman a, *, Jannes Slomp a , Samantha Rolefes b a Faculty of Management and Organization, University of Groningen, P.O. Box 800, 9700 AV Groningen, Netherlands b Exticity Software, Redwood Shores, CA, USA Received 10 April 2000; accepted 20 February 2001 Abstract This paper describes the evolution of a cellular manufacturing system in a medium-sized company over a 13-year period. The objective of this paper is to analyze the arguments that gave rise to the nearly continuous readjustment of the design of the cellular manufacturing system of this company and the direction in which these adjustments took place. The study indicates that two interrelated factors played an important role in the decision to change the system: the market and manufacturing technology. Analysis of these factors offers important insights into the aspects that need to be taken into account in cell formation. It is argued that a cellular system should reflect market characteristics. New technology, furthermore, demands specialized cells, producing in a multi-shift situation. These two developments point in the direction of market-oriented, reasonably sized, functionally organized manufacturing units. It is argued that market developments, new manufacturing technology and modern production control systems will probably constrain the application area of cellular manufacturing. # 2002 Elsevier Science B.V. All rights reserved. Keywords: Cellular manufacturing; Longitudinal case study; Market; Manufacturing technology; Performance; Management strategy 1. Introduction A cellular manufacturing (CM) system is defined here as the grouping of workers and machines into relatively independent cells, which are responsible for the complete manufacturing of a set of part types. Many firms have adopted CM as a strategy for improving performance. Case studies (e.g., [1–14]) and survey articles (e.g., [15– 17]) show important advantages of CM such as shorter throughput times, better product quality, and lower material handling costs. An important flaw of these studies is that they consider the success of CM only in the short term. Cell formation is likely one of the most researched topics in the field of cellular manufac- turing [18]. A large number of cell formation techniques have been developed through the years. All techniques require nearly the same informa- tion: number and types of machines, volume, routings, and processing times of part types [19– 21]. A topic related to cell formation that has gained little attention in the literature concerns the stability of a CM system through the years. Some authors have investigated the effect of volume and *Corresponding author. Tel.: +31-503633846; fax: +31- 503632032. E-mail address: h.b.m.molleman@bdk.rug.nl (E. Molleman). 0925-5273/02/$-see front matter # 2002 Elsevier Science B.V. All rights reserved. PII:S0925-5273(01)00139-6