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2.1 Introduction

In this chapter, facts and finds of some research subjects by the work of experts and
practitioners that will support the research question are defined and explained.
Apparently, this chapter divided into five sections, there are definition of AMT,
classification of AMT, types of technology, manufacturing capability and the previous

2.2 Definition of Advanced Manufacturing Technology (AMT)

There are many researchers have defined AMT in different perspective. There is no
exact definition or perspective on AMT. Therefore, Industry Canada (2002), defined
AMT as a key enabler to help manufacturers meet the productivity, quality and cost
reduction demands of competitive global markets. On the other hand, Sun (2000),
defined AMT as computer-aided technologies used in manufacturing companies.
According to Teng & Seetharaman (2003), AMT involves new manufacturing
techniques and machines combined with information technology, microelectronics and
new organizational practices in the manufacturing process. In general, AMT is defined

as an application of computer-enhanced, applied science to a firms production systems

(Tracey & Tan, 2001).While, Park (2000), defines AMT as a comprehensive collection
of technologies for enhancing the efficiency and flexibility of manufacturing systems.
Even though there are many different definition and perspective on AMT,
generally it is agreed that AMT has been widely defined as a group of computer-based
technologies. In this manner, the next session provided with different types of AMT

2.3 Classification of AMT

AMT have been classified into many different types of classification by many
researchers which are relevant for this study. Therefore, the Table 2.1 provided with
those different types of AMT classification.

Table 2.1: Different types of AMT classification




Types of Technology


Product design

Focus primarily on product

definition and design-related
information processing

Computer-aided design (CAD)

, Computer-aided engineering
(CAE) and automated drafting


These technologies control

manufacturing processes
and generate process related
information on factory floor.

Flexible manufacturing systems

(FMS), Numerically controlled
(NC), Programmable


Focus on controlling and

monitoring the material
flow from the acquisition of
raw materials to the delivery
of finished products and
related counter flows of
logistical information.

Production scheduling systems,

shop floor control system and
material requirements planning
(MRP) systems.


Helps to facilitate the

storage and exchange of
information among process,
product and logistics

Common databases, system

translators, data transfer
protocols and intra- and interfactory networks.




Types of Technology

Kotha &

exchange and

Assist in information
exchange and production
planning and control

Local area network(LAN) for

factory use, Computer used for
control on factory floor, LAN
for technical data, Computers
for production scheduling,
Electronic data interchange,
MRP I and MRP II systems and
inter-company networks.

Product design

Correspond to product
design dimension

CAD, CAE and Automated

drafting technology


Extremely useful and

necessary in high-volume
manufacturing of discrete

Computer-aided quality control

performed on final products,
computer-aided inspection
performed on in coming or in
process material, robot other
than pick and place, pick and
place robots and manufacturing
automation protocol


Associated with flexibility

and their ability to assist in
rapid changes in production
volume and product

NC/CNC machines,
programmable controllers,

Direct AMT

This technology used on the

factory floor to cut, join,
reshape, transport, store or
modify materials.

CNC, DNC, robotics, FMS,


Indirect AMT

This used to design products

and schedule production.



Give administrative support

to the factory and integrate
operations with organization





Computer-aided design (CAD)

and Computer-aided process
planning (CAPP)


Automated guided vehicles

(AGVS) and automated storage
and retrieval systems (AS/RS)


Flexible manufacturing systems

(FMS), and computer
integrated manufacturing


From the relevant types of classification of AMT, it can be concluded that the
concept of AMT depends on various contexts and situation. However, the similarities for
all these classification types of AMT are that the identification of the types of
technologies which are used to develop assessment models for AMT.
For the purpose of this study, the classification from Kotha & Swamidass (2000),
is chosen as the model. The reason for choosing this classification is because this is the
updated classification of Kothas and completed among others classification. The chosen
AMT classification has four dimensions such as Information exchange and planning
technology (IEPT), product design technology (PDT), high-volume automation
technology (HVAT) and low-volume flexible automation technology (LVFAT).

2.4 Types of Technology

According to Kotha & Swamidass (2000), there are many types of technology included
in the classification of AMT. The following are the types and explanation of those

2.4.1 Local Area Network (LAN)

Network is interconnection of computers. Small networks are often called Local Area
Network (LAN). LAN is a network allowing east access to other computers and it is
physically limited distance that is about less than 2KM (Pavani et al., 2012). LAN
divided into two categories, there are: LAN for factory use

LAN for factory use denotes the network employed to exchange information between
different points on the factory floor.

11 LAN for technical data

LAN technology for technical data is imploded to exchange technical data. This data
exchange will occur within design and engineering departments.

2.4.2 Computers used for control on the factory floor.

This technology includes computers that perhaps dedicated to control. But for other
functions these computers are capable of being reprogrammed. It excludes computers
imbedded within machines, or computers used solely for data acquisition or monitors.

2.4.3 Material Requirements Planning (MRP I) and Manufacturing Resource

Planning (MRP II)

This systems use computers and computer modules for controlling the entire
manufacturing system from order entry through scheduling, inventory control, finance,
accounting, accounts payable and so on.

2.4.4 Inter-company networks

Inter-company computer networks linking plant to subcontractors, suppliers and/or

customers. This denotes the computerized networks used to exchange information with
the firms external constituents.

2.4.5 Computer-aided Design (CAD) and Computer-aided Engineering (CAE)

CAD and CAE use computers for drawing and designing parts or products and for
analysis and testing of designed parts or products. Park et al., (2003), states that CAD
and CAE have the ability of integration. But, many of this is often stand-alone systems
that are not intended for integration use. Engineering designers and analysts tend to use
CAD for design and other CAE for analysis (Sun et al., 2007).


2.4.6 Automated drafting technologies

Automated drafting technologies use computers for drafting engineering drawings.

According Cao et al., (2005), these drawings are standardized by some codes, and based
on these codes, main data items associated with each drawing can be extracted

2.4.7 Computer-aided inspection performed on incoming or in process materials

This technology denotes the use of computers for inspecting incoming materials. Part
and product inspection is evolving to be an important module of integrated
manufacturing. Therefore, it is help to control production and achieve the desired quality
rather than a means of rejection at the end (Fiona et al., 2009).

2.4.8 Robots other than pick and place

This use sophisticated robots that can handle tasks such as wilding or painting on an
assembly line. Here trajectory control is available. According, Pires et al., (2009), these
robots are usually provided with a teaching pendant and PC-based offline programming
interface connected to its controller. Thus, the programming robots process usually
unintuitive and time-consuming.

2.4.9 Pick and place robots

Pick and place robots a simple robot, with 1, 2, or 3 degrees of freedom, which transfers
items from place to place by means of point-to-point moves. Little or no trajectory
control is available. Huang et al., (2007), state that in order to achieve high productivity,
it is desirable for pick-and-place robots to follow a specified geometric path that gives
the minimum time motion.


2.4.10 Numerical Controlled/Computer Numerically Controlled (NC/ CNC)

NC or CNC is a single machine whereas with or without automated material handling

capabilities. NC machines are controlled by numerical commands punched on paper or
plastic Mylar type, while CNC machines are controlled electronically through a
computer residing in the machine.

2.4.11 Programmable controllers

Programmable controllers are solid state industrial control device that has programmable
memory for storage of instructions, which performs functions equivalent to a relay panel
or wired solid state logic control system.

2.4.12 Computer-aided design/ Computer-aided manufacturing (CAD/CAM)

Use CAD/CAM output for controlling machines used in manufacture of the part or
product. According Ping-Yi et al., (2001), CAD/CAM is capable of handling geometric
information for a product throughout its life cycle. CAD/CAM ensure the design
consistency during the process of product design, engineering analysis, engineering
simulation, up to product manufacturing and make information be directly transmitted
among computers (Hui-Fen et al., 2002).

2.4.13 Flexible manufacturing cells (FMC)

FMC is a two or more machines with automated material handling capabilities

controlled by computers or programmable controllers, capable of single path acceptance
of raw materials and single path delivery of a finished product.


2.4.14 Flexible manufacturing systems (FMS)

Two or more machines with automated material handling capabilities controlled by

computers or programmable controllers, capable of multiple path acceptance of raw
materials and multiple path delivery of a finished product. A FMS may also be
comprised of two or more FMCs linked in series or parallel.

2.5 Manufacturing Capabilities

Manufacturing capabilities is defined as activities that a firm can do better than its
competitors (Hayes & Pisano, 1996).Whereas it is, to enable a manufacturing company
sustaining a superior performance position in the capability relative to competitors
(Mclvor, 2008). Organizations increasingly become skilled in manufacturing products
and services which enhance the existing knowledge regarding technologies, procedures,
processes and market inputs through manufacturing capabilities (Benner & Tushman,
2003). Manufacturing capability also enhances both internal and external technological
learning (Mukerji et al., 2010). Manufacturing capabilities are generally categorized in
terms of cost, delivery, flexibility and quality (Hallgren & Olhager, 2006). These
categories explained in detail in the following section.

2.5.1 Cost
According Dangayah & Deshmukh (2003), cost is manufacturings strategic counterpart
to price as a competitive weapon in the marketplace. The task of the manufacturing
function is to provide low cost product, to support the business and the low cost is a
well-established manufacturing capability (Dangayah et al., 2006).

2.5.2 Delivery

Delivery is the strategy of providing on-time delivery of an item (Dangayah &

Deshmukh, 2003). Delivery also refers to faster delivery of product in correct time and


its divided into two dimensions such as dependable delivery(all ordered products should
be produced and delivered in time and in ordered quantities) and delivery speed
(Dangayah et al., 2006). For delivery, some of the performance measures are the number
of changes in time periods, performance delivery and machine availability (Yurdakul,

2.5.3 Flexibility

Flexibility is an act in response to changes in production, changes in product mix,

modifications in design and fluctuations in materials and changes in sequence
(Dangayah & Deshmukh, 2003). According Dangayah et al., (2006), flexibility is the
ability to change or react with little penalty in time, effort, cost or performance and it has
been long recognized as a manufacturing capability that has the potential to impact the
competitive position.

2.5.4 Quality
Quality is a variable associated with a firms ability to provide superior products
(Dangayah & Deshmukh, 2003).Quality refers to increased uniformity, consistency in
product and easiness in product testing (Ariss et al., 2000). Moreover, quality is a
variable associated with a firms ability to provide superior products (Dangayah et al,
2006). According Garvin (1993), quality refers to all physical aspects of the process and
product or service delivered. He suggested a list of dimension of quality: performance,
features, reliability, conformance, durability, serviceability, aesthetics and perceived
Therefore, due to time limitation the researcher for this research specifically
choosing quality to be the main criteria and proceed the study into quality performance.
Moreover, the reason for choosing quality performance specifically; because, according
Edly et al., (2007), it is been always a major discussion issues for the need to improve
quality performance due to competitive pressure in manufacturing companies. So that,
each manufacturing companies must be able to identify the current quality performance


in order to achieve the higher competitiveness level. The indicators for quality
performance are product/service quality, productivity, cost of scrap and rework, delivery
lead-time of purchased materials, and delivery lead-time of finished products to
customers (Kaynak, 2003).

2.6 Previous Studies

Kotha & Swamidass (2000), state that one of the AMT dimension; IEPT empirically
combines the Information Exchange Technology (IET) and Process Technology (PT).
Therefore, several studies have been done from the economics viewpoint, finds that
information exchange technology provide higher exchange quality, lower coordination
costs, reduced inventory costs and enhanced strategic and operational benefit
(Mukhopadhyay et al., 2002). At the same time, process technology seen as a long-term
choice for the company. This being an important criterion for these improved product
quality, faster delivery of customer orders and reduced production cost (Idris et al.,
Product design technology (PDT) is corresponding to product design dimension
(Kotha & Swamidass, 2000). Therefore, computer-aided design (CAD) is used to design
or redesign production tools. The manufacturing layout for a new product may evaluate
using CAD. With built-in computer aided engineering (CAE) capabilities, engineers can
examine and test a CAD design-product, tool and layout from a structural and
engineering viewpoint (Chong et al., 2006). CAD provide higher engineering
productivity, better design quality and fewer mistakes in automated operations (Smith,
2004). Applying CAD also leads to shorter design cycle time, reduces cost and order-todelivery lead time (Chong et al., 2006).
High-volume automation technology (HVAT) is extremely useful and necessary
in high-volume manufacturing of discrete products (Kotha & Swamidass, 2000).
Therefore, technologies such as computer-aided quality control and robotics provide a
better quality of production and fasten the production process; while reduce the cycle
time in a company (Lewis et al., 2002).


In contrast, the dimension; low-volume flexible automation technology (LVFAT)

are often associated with flexibility, and for their ability to assist in raped changes in
production volume and product introductions (Kotha & Swamidass, 2000). Thus, it is
not surprising for technologies such as numerical controlled/computer numerically
controlled (NC/CNC) machines, programmable controllers and flexible manufacturing
cells (FMC)/ flexible manufacturing systems (FMS) to have a strong impact on product
quality in the aspect of reducing scrap and rework, increase product quality and error
free (Abdullah et al., 2012). Moreover, organizations that have succeeded in improving
productivity, cost and quality have typically used AMT such as the mentioned
technologies (Gudgel et al., 2004).
In general, AMT are expected to make the manufacturing process capable of
achieving productivity, quality and satisfying customer demand for new and diverse
products (Challis et al., 2002). There is evidence that AMT increase productivity, quality
and equipment flexibility, while decreasing lead-time (Patterson et al., 2004). In
contrast, there is evidence that AMT fail to achieve significant performance
improvements (Challis et al., 2002).
Lewis et al., (2002), state AMT poses tremendous advantages and challenges for
companies. Many companies invested in AMT mainly because they believe that AMT
will provide simultaneous benefits of faster speed, increased productivity, high quality
and greater product variety (Efstathiades, 2002). However, AMT in isolation is not
enough to improve performance and need to be supported by other factors (Marri et al.,
These mixed results have led some researchers to argue that if AMT fail to live
up to their potential to increase the manufacturing performance, it is because they are too
complex (Mithal & Pennathur, 2004). It is maybe they are more focused in achieving the
productivity and rarely to satisfy customer demand for new and diverse products (Dean
and Snell, 1996).


2.7 Conclusion

This chapter has outlined and reviewed the literature reviews that are available to
researcher applicable the context of this study. Therefore this study will be focusing on
Advanced Manufacturing Technology (AMT) and quality performance in Malaysian
manufacturing companies to investigate the relationship between AMT and quality