Expert systems in production and operations management

Current applications and future prospects

Vaidyanathan Jayaraman
University of Southern Mississippi, Long Beach, Mississippi, USA, and

Expert systems in POM

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Rajesh Srivastava
Air Force Institute of Technology, Wright-Patterson AFB, Ohio, USA
Introduction Expert systems (ESs) solve problems that are normally solved by human experts. An ES is a problem-solving package that mimics a human expert in a specialized area. An ES can also be defined as a computer program that exhibits, within a specific domain, a degree of expertise in problem solving that is comparable with that of a human expert. ESs need to exploit one or more reasoning mechanisms to apply their knowledge to the problems that are given. Then they need a mechanism for explaining what they have done to the users who rely on them. Some ESs have already been successfully implemented in production and operations management (POM). Although POM is a promising area for ESs, applications to date have been haphazard and independent research efforts have also been minimal. As research and development of ESs requires considerable effort, an organized assessment seems warranted. The purpose of this paper is to examine the applicability of the ES in POM by exploring the different types of generic decision that often require experts and to see when and if these decisions types apply in POM settings. ESs are perceived to be an important tool for decision analysis. To understand and appreciate expert systems better, it is vital to understand decision analysis, its supporting elements and its role in the decision-making process. The ES plays a key role as a tool to enhance productivity, improve quality and increase profits while minimizing costs and capturing expertise in many business and industrial environments. However, one of the main reasons why many ESs fail to be integrated into the operational environment is a lack of knowledge and technique on how to develop, test and implement an ES efficiently. POM is a very fertile application area for ESs owing to its heavy orientation towards decision analysis and problem solving. Past research in ESs application to POM have been minimal owing to the paucity of information that exists on ESs application in POM within an organizational context. The purpose of this paper is first, to present an overview of ESs and the different decision areas in ESs, to classify ESs in POM and to examine the literature

International Journal of Operations & Production Management, Vol. 16 No. 12, 1996, pp. 27-44. MCB University Press, 0144-3577

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which deals with their applications in POM. Some important and critical issues relating to ESs application to POM are discussed next. Finally, some of the limitations of the ES to solve POM problems are examined, and the future prospects and scope for research in this area are also discussed. An overview of ESs ESs are one of the most commercially successful branches of artificial intelligence (AI). Waterman[1] defines the ES in the following fashion:
An expert system contains a knowledge base, a dialog structure and an inference engine, which consists of an interpreter and a scheduler. The knowledge base is the collection of the domain knowledge. The dialog structure provides communications and interaction with the user during the operation and processing of the expert system. The inference engine contains the general problem solving knowledge. The interpreter makes decisions on how to apply the rules for inferring new knowledge and the scheduler prioritizes the rules in the appropriate order.

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Artificial intelligence is an attempt to teach machines the characteristics of human intelligence. Intelligence is associated with the ability to recognize patterns, apply experience and expertise to patterns to solve problems, learn from new experiences and apply judgement when data are incomplete or unavailable. ESs capture the strengths of, and integrate well with, other branches of AI such as natural language processing, pattern recognition and programming environments. ESs have been applied to POM domains such as process control, quality control, scheduling, production management, project management, trouble-shooting and diagnosis. All successful systems have four main features in common[2]: selection of a suitable problem domain, realistic expectations of what the system can and should do, unwavering commitment and support of top management for the technology and thorough testing of the product before integrating it into the operational environment. Short-circuiting any of these four features has consistently led to product abandonment. Characterization of ESs ESs can be grouped into three major categories depending on their area of application. The first category deals with problems of diagnosis. Medical diagnosis has been a widely explored area under this category. The second category deals with systems concerned with design problems. The third category comprises ESs designed for decision-support systems. There are three key types of information transfer in an ES which differentiate it from other decision-support systems[3]. An ES requests relevant information from the user about the problem area. It also offers a recommendation based on the data given by the user and, if a nonexpert requests information, it provides the justification for the decision. The four main advantages of ESs[4] are: (1) an apparent intelligent behaviour in performing complex tasks; (2) the ability to give reasonable justification and explanation to conclusions;

(3) the ability to exploit knowledge in an opportunistic way; and (4) the ability to deal with incomplete and imprecise knowledge/data. Some of the earlier work on ESs evolved in the different decision areas outside POM. Work on DENDRAL[5,6] (an ES application in chemistry), generally considered to be the very first ES, began in the mid-1960s at Stanford University. The purpose of DENDRAL is the identification of the molecular structure of unknown compounds, a problem of considerable computational complexity. HEARSAY I[7] was developed in an attempt to demonstrate the possibility of a speech recognition system. ESs were first applied to medical diagnosis through the INTERNIST[8-10] project to perform a diagnosis of the majority of diseases associated with the field of internal medicine. The project was not only intended to diagnose each disease, but was also supposed to consider all the possible combinations of diseases that might be present in the patient. MYCIN[11,12], an expert in blood infections, was developed to provide assistance to physicians in the diagnosis and treatment of bacteraemia infections. Applications in other areas have also evolved. In the 1980s, XCON[13] was developed for the configuration of VAX computers at the Digital Equipment Corporation. DELTA/CATS[14] is an ES that was developed by General Electric to assist railroad personnel in the maintenance of diesel-electric locomotives. More recently, ESs are also being used in managerial decision making, business areas such as accounts receivable (AUDITOR[15]), capital budgeting (DECMAK[16]), conflict resolution[17] and portfolio management[18]. To provide some classification scheme and to enable development of the ES, one should first be able to identify the decision areas for which the system is being developed. Expert decision areas Expert decision areas can be broken down into eight different segments of expert tasks: (1) Consulting (CON): this includes the task of recommendation of certain actions or behaviour given the set of constraints and circumstances. (2) Designing (DES): this is the task of designing specifications for objects that satisfy a given set of constraints. (3) Diagnosing (DIA): this includes the task of analysing and verifying whether the system is functioning in its proper state. (4) Interpreting (INT): this is the task of confirming the reliability of data with regard to its comprehensibility. (5) Monitoring (MON): this is the expert task of continuous interpretation of signals and the setting-off of alarms as needed. (6) Planning (PLA): the creating of programmes of action that are to be carried out to achieve a goal.

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(7) Predicting (PRD): the expert task of forecasting some future event. (8) Teaching (TEA): the expert task of tutoring and diffusion of knowledge. Stefik et al.[19] have provided expert tasks 2-7. Mertens and Allgeyer[20] have provided expert tasks 1 and 8. Classification and development of ESs One way in which we can classify ES is in terms of three primary problemsolving activities: searching, satisfying constraints and reasoning[21]: (1) Searching. The purpose of an ES is to develop and recommend a proposed solution or a set of alternatives to a given problem. To accomplish this task, the ES must conduct a search for the solution. The state space is searched for a solution point through the application of operators to some chosen states. The two fundamental search strategies employed by an ES are forward and backward chaining. Forward chaining proceeds from a premiss to some conclusion and is said to be data-driven. Backward chaining is often a goal-driven approach and proceeds from a tentative conclusion to a premiss to determine if the data support that conclusion. (2) Satisfying constraints. Constraint satisfaction works by process of elimination. It starts with the entire state space and narrows down the original state space to a required subset. (3) Reasoning. Reasoning is the process of accumulating information by inference until the solution to the problem is deduced. The process of building an ES is called knowledge engineering. This consists of problem selection, knowledge representation, knowledge acquisition, knowledge engineering, knowledge testing and evaluation. Problem selection There are some key areas which represent suitable problem domain ESs[22]. They include: An expert exists and is willing to co-operate and articulate. An ES cannot solve problems that humans cannot solve. It can only be created if the problems are capable of being solved by human experts. It should be possible to transfer the skills of the human expert to a computer program. There should be significant pay-offs of the resulting system to justify the resources needed for its construction. Knowledge representation The knowledge that is contained within an ES consists of: A priori knowledge. This consists of the facts and rules that are known about a specific domain prior to any contact or dialogue with the ES.

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Inferred knowledge. The facts and the rules concerning a specific case which are derived during or at the end of a consultation or interaction with the ES. A good system for the representation of knowledge in a particular domain should possess the following properties: Representational adequacy: the ability to represent all kinds of knowledge that are needed in a particular domain. Inferential adequacy: the ability to manipulate the structures in a way so as to derive new structures corresponding to new knowledge inferred from the old. Inferential efficiency: the ability to incorporate additional information that can be used to focus the attention of the inferential mechanisms to feasible directions. Acquisitional efficiency: the ability to acquire new information easily. Knowledge acquisition The knowledge acquisition phase of development is the transfer and transformation of problem-solving expertise from some knowledge sources to a program. It is also the phase that can be extremely frustrating as well as time-consuming. It is also the bottleneck of ESs development because we are often dealing directly with domain experts and interfacing with domain experts can be very frustrating. Two widely employed approaches in knowledge acquisition consist of acquiring knowledge directly from experts and acquisition through the use of historical records which is also referred to as rule induction. Knowledge engineering Knowledge engineers represent those who identify appropriate applications of ESs and who perform the process of development and implementation. A knowledge engineer must work closely with other people including domain experts as well as other knowledge engineers. He/she should be able to deal effectively with ill-structured problems. An efficient knowledge engineer would probably be familiar with topics such as heuristic programming, cluster analysis, discriminant analysis and problems like sequencing and scheduling. Knowledge testing and evaluation This is the stage of an ES where a thorough analysis and testing of the knowledge base and inference structure take place. The human expert is often used to challenge and test the performance of the ES. Once the ESs scope of reasoning has been stabilized, the results of the revisions should lead to a better convergence towards an ideal ES.

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A POM framework for ES classification In this section an attempt will be made to establish a framework for ESs classification in a POM environment. A classification schema which separates the applications into different clusters can be formed. Mertens and Kanet[3] provide a taxonomy for classification of production management. However, the role of production management can be interpreted somewhat differently from the way it was viewed by Mertens and Kanet[3]. Mertens and Kanet viewed Technological activities as those which consisted of areas like industrial engineering. However, not all the areas that were described under technological activities may be viewed as POM. One should provide a distinction between engineering (eg. manufacturing engineering, industrial engineering) and POM. Further, their paper did not provide a complete listing of decision areas in POM. A different way of classifying the ES in POM would be on the level of applicability of the ES to the decision-making areas of POM. Decision making in POM could be categorized into two major areas: strategic and operational/ tactical. Strategic planning and decision making suggest that the focus should be on first-order questions. It must be decided whether to hold an item in inventory before deciding about its reorder point. Strategic planning also implies a longer time horizon, less certainty, less structure, an ends orientation, poorly defined information requirements, generally irreversible impact and a focus on the whole organization. It is generally characterized by unstructured to semi-structured scenarios or conditions. POM areas like facility location, facility layout, aggregate planning, capacity planning, forecasting, job design, purchasing and technology fall under the strategic decision-making area of POM. Further, areas like process choice and product design also fall under the unstructured strategic decision making area of POM. Operational/tactical decision making, on the other hand, has a shorter time horizon, more certainty, more structured, well-defined information requirements and tends to have a reversible impact. An operational choice, such as how much to order this month from a certain supplier, has much less impact than the strategic decision to build a new warehouse. If a mistake is made on the order quantity, a supplemental order can be placed; if a mistake is made in the size, location or timing of the warehouse construction, the firm is stuck with a costly, inefficient facility. Master scheduling, materials planning, shopfloor and workforce, scheduling, quality control, distribution, inventory, purchasing, short-term capacity planning and short-term forecasting fall under the operational decision-making area of POM (see Figure 1). Applicable tools for ESs Two major tools which are used in ESs are optimization and simulation. In optimization, while operations research employs a systems approach which uses the memory-less property of making decisions from scratch, irrespective of the existing way of doing something, AI emphasizes trying to model human expertise and capabilities. Phelps[23] concluded that there was great potential

Unstructured Strategic

Semi-structured

Highly structured Operational

Expert systems in POM

Process choice Process design Product design Quality planning

Facility location Facility layout Project management Long-term capacity planning Job-design Aggregate planning Long-term forecasting

Notes aCan also be strategic Strategic planning and decision making: Implies a longer time horizon, less certainty, less structure, poorly defined information requirements Focuses on the whole organization Generally characterized by unstructured to semi-structured conditions Operational planning and decision making: Implies a shorter time horizon, more certainty, well-structured, well-defined information requirements Generally characterized by semi-structured to well-structured conditions

Short-term capacity planning Distributiona Scheduling Quality control Inventory control Maintenance Short-term forecasting Purchasinga

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Figure 1. Decision making classification in POM

in integrating the data exploration techniques of statistics, the model formulation and the mathematical programming techniques of operations research, and the ESs approach of AI into a relatively new and powerful form of decision making. Kusiak[24,25] presented two operational modes in ESs. In the first mode, data were used and the constraints from the problem environment were considered to generate a solution, while in the second mode an algorithm was used to derive a feasible solution which was evaluated by the ESs. Another important tool which is used in ESs is simulation. There are several advantages in using simulation. Experiments can be conducted very rapidly, conditions can easily be replicated, programs can return to previous states at no cost, and sensory input can be treated in a high-level fashion. Gaines and Shaw[26] discussed the the idea of integrating ESs with simulation. Vaucher[27] compared simulation and AI approaches in modelling. He suggested that, while AI researchers stressed logical conclusions by proving system properties, simulation practitioners emphasized the dynamic behaviour of systems and were concerned with the evaluation of systems through time. Lenz[28] stated that the role of ESs in manufacturing problems which used simulation was to reduce the complexity of using a complicated tool to solve a complex problem. Application of ESs in POM areas In a recent paper, Wong et al.[29] examined the utilization of ESs and their benefits in manufacturing among the 500 largest industrial companies in the

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USA. Their study was focused on ESs in manufacturing and aimed at seeking answers to the following two questions: (1) What prevents certain large companies from utilizing ESs in manufacturing? (2) For those companies which do utilize ESs in manufacturing, how useful are these ESs in helping the companies achieve their production goals? The study concluded that top management plays a pivotal role in the productive implementation of ESs. Further, the ESs of the future for manufacturing must combine technological and logistical knowledge, since both types of information are needed for production decisions. In this paper, some of the current applications of ESs in the different decision areas of POM and examples of typical issues in these decision areas are summarized in Table I. The applications range from the operational to the strategic level. Most of the applications occur in highly structured to semistructured conditions. There are few examples at the strategic level, primarily because of the unstructured conditions, greater uncertainty, and poorly defined information requirements. The ES applications in Table I are classified by decision areas, without consideration of decision-making level. A detailed examination of the applicability of ESs in the different decision areas of POM is presented next. Capacity planning Capacity planning is a decision area central to the long-term growth of an organization with both strategic and operational implications. Poor capacity planning can prove very costly. Capacity planning requires an indication of current capacity and its utilization, so that future additions can be scheduled properly. Stroebel et al.[31] have described a capacity-planning ES for the IBM system called a performance expert prototype (PEP), which uses a blackboard as a means of communication between modules, each of which is a specialist in some sub-task. The user module is written in PASCAL, a control module in REXX, a command language, and the evaluation module in LISP and OPS5. PEP has been implemented on the VM under the CMS operating system. Facility location and design Location decisions have strategic implications because they can assist in achieving company goals. Facility location deals with determining the geographic site at which a productive facility is situated and the size of the new facility. The problem gets cumbersome because it involves both quantitative factors (eg. labour costs, transportation costs) and qualitative factors (community attitudes, legal problems). The facilities design expert system (FADES)[32] uses a knowledge-based or expert computer system to combine judgemental rules of human experts with quantitative tools. It developed good facility designs for a variety of unstructured design situations. However, we still need more ESs to decide among competing alternative plant or warehouse

POM area Capacity planning

Strategic decision making Yes

Operational decision making

Example issues What is a reasonable size for a facility? What is workforce size for our production system? What is the best geographic site to locate our production facility? How should we arrange equipment in our facility site?

Examples of current applications in decisionmaking area PEP

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Yes Facility location Facility layout Yes

FADES

Yes

ALDEP, CORELAP, WORKPLACE DESIGNER Levitt and Kunz[30] model PATRIARCH

Project management Aggregate planning Process choice/design

Yes Yes

What is the earliest due date for our project? What should be the output rates and staffing levels for this quarter? What is the selection of inputs, work flows and methods that need to be used to produce goods and services? Does the design of the product fit the firms capability to produce it? Yes What customers or jobs should receive top priority?

Yes

GARI, TOM

Product design Scheduling Quality management

Yes

XCON, CDX

ISIS, MARS

Yes Yes

How do we best achieve our PL DEFT quality goals? Is the process capable of meeting the specifications? How much inventory do we need in our store? How should we control it? Where do we have a problem in our equipment? What kind of measures should we take to control or remove this problem? How do we design the best forecasting procedure to suit our needs best? IVAN, LOGIX, RIM DELTA/CATS

Inventory control Maintenance

Yes

Yes

Forecasting

Yes

NOSTRADAMUS, EMEX, SMART FORECASTS (Continued)

Table I. Examples of current applications of ESs in POM

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POM area Strategic decision making Yes Operational decision making Example issues

Examples of current applications in decisionmaking area

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Distribution

Yes

Purchasing

Yes Yes

Table I.

What is the best distribution NDR, SEA-PATH, strategy for transporting PICK-PATH multiple products from warehouses to customers? How many units of raw material A should we transfer from vendor B to manufacturing plant C? What procedure do we use to ASAP, AES identify our suppliers and evaluate them? What procedures can be used for procurement requests?

locations. The ES, perhaps could use principles of multi-attribute decision theory to help the decision maker eliminate one or more alternatives from consideration. Facility layout Layout choices are critical decisions and must be tied closely to higher level decisions made by the management. Computerized relationship layout planning (CORELAP) and automated layout design program (ALDEP) are some examples of systems which have been developed to aid in the layout of facilities. Unfortunately, most of these systems fail to have any procedural rules which take into consideration the creative aspects of a human design expert. There is no involvement of any learning. Lesknowsky et al.[33]) described two new group technology decision aids in ESs which used a group technology-based approach for finding the initial part machine groupings and laying out the machining areas in these groups to minimize material-handling costs. WORKPLACE DESIGNER[34] evaluates layouts and recommends design changes to improve labour productivity. Project management Project management deals with the scheduling and control of large projects. A project is a set of activities, with a definite starting and ending point, that results in a unique product or service. The only known application of an ES using project management was developed by Levitt and Kunz[30] who used a prototype which applied AI techniques to modify activity lists and schedules. The model was applied to offshore oil platform construction.

Aggregate planning The aggregate planning problem can be stated as follows: given a set of forecasts, Ft, determine production, inventory and workforce levels (Pt, It and Wt respectively), t = 1, 2, , N, which minimizes cost subject to appropriate constraints. Typically, the planning is done on a monthly basis over a 6-18month horizon, N. PATRIARCH[35] is a multilevel planning, scheduling and control system that was developed for manufacturing. It incorporates AI knowledge modelling, multi-level networking and advanced economic costing to plan on strategic forecasting and planning, master scheduling and scheduling on real-time control. Process choice/design Process design is the selection of inputs, operations, work flows and methods used to produce goods and services. Input selection includes choosing the preferred mix of human skills, raw materials and equipment consistent with an organizations strategy and its ability to obtain these resources. A number of ESs have been developed for dealing with the process design stage of manufacturing. The first knowledge-based system to deal with process design was GARI[36]. It develops plans for machining sequences of mechanical parts and also production rules as well as rules for process and cut selection. Technostructure of machining (TOM)[37] was another system for a machining process planning system. It used production process plans for machining some mechanical parts. However, these systems focus on choice of equipment in the existing process, and do not focus on the larger issues of designing the process to aid a firm with its competitive priorities and strategies. Product design The only existing knowledge-based system for product design was called XCON[13] and was considered by the AI community as the first truly successful, commercial implementation of the ESs concept. It is used in the product design specifications of all major Digital Equipment Corporation (DEC) systems. It considers factors such as cable-length constraints, sizes of cabinets and power requirements in the configuration of systems. CDX[38], used by DEC, is an example of a product life cycle ES used to analyse VMS failures in the field. Scheduling A number of applications of ESs to scheduling have been developed and documented[39-43]. The prototype expert priority scheduler (PEPS)[44] is a rule-based ES which solves problems in shopfloor control level. It is a classic example of an ES that was used to solve day-to-day manufacturing problems. However, a major drawback with PEPS is its inability to recognize uncertainty and downstream data dependency. Intelligent scheduling and information systems (ISIS)[39] was the first application of ES to job-shop scheduling. ISIS used hierarchical planning to decompose complex problems into manageable

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pieces. The research with ISIS led to work on the development of the opportunistic scheduler (OPIS)[45], a knowledge-based factory-scheduling system which uses problem decompositions to generate constraint-satisfying shop schedules. A management analysis resource scheduler (MARS)[46] has been developed to schedule resources for the space transportation system. Newman[47] provided a summary of scheduling in computer integrated manufacturing (CIM) and believed that scheduling could be done with ESs to control inventory so that materials could arrive on a just-in-time system to reduce storage costs. A hybrid expert systems (HESS)[48] was developed at the University of Houston in support of product scheduling at a major petrochemical firms refinery. The knowledge base in HESS was developed to determine what product, or products to produce at what time, and through which processors. Their performance was measured against the costs of production, production ruins (products not meeting specifications must be recycled or downgraded) and lost customer sales. An application in workforce scheduling is reported by the Temple Dental School[49]to schedule students clinical rotation. The schedule must satisfy several demands: clinics have to be adequately staffed, students need time off for lectures and treating patients, and each student should serve approximately the same number of rotations over a two-year period. Quality management Process control and quality assurance are key components of production and operations management. An important planning decision in quality control is to determine when, where and how production processes are to be monitored to maintain strict quality standards. Statistical process control (SPC)[50] is a commercial ES which deals with control of quality and is connected to AI vision sensors to perform repeated inspection and to gather data. The data are statistically analysed to guide modifications to the manufacturing process and to optimize the input or anticipate malfunctions. Another application of the ES to the POM area of quality control is the diagnostic expert final test (DEFT)[10]. This system was developed for diagnosing airflow problems on the IBM 3380 direct access storage devices. Inventory control Inventory can be defined as those stocks or items used to support production (raw materials and work-in-process items), supporting activities (maintenance, repair and operating supplies) and customer service (finished goods and spare parts)[51]. Inventory is created when the rate of receipts exceeds the rate of disbursements. It is depleted when disbursements exceed receipts. One of the few existing ESs that handles inventory control was developed as a prototype data-driven ES for inventory modelling[52]. Inventory control is an ideal area where the ES can be applied because it is closely linked through the intermeshing of the OPS5 control system and has its parameters and regression

routines conveniently supported in LISP. Federal-Mogul[38] uses LOGIX for order entry, rescheduling and adjusting reorders to improve annual inventory productivity. The ES reduces manual effort, increases accuracy and consistency, and allows additional trade-off analysis to meet emergency needs from repackaging of inventory and vendor/plant expediting to meet customer needs. The US Navy uses an ES, retail inventory management (RIM)[38] to assist inventory analysts at the distribution centre and in the processing of critical stock items. IVAN[38] is an ES used for planning raw material safety stock requirements. Maintenance Maintaining the production capacity of an organization, regardless of the degree of capital intensity, is essential to long-term growth and profitability[53]. The diesel-electric locomotive troubleshooting aid/computer-aided troubleshooting system (DELTA/CATS-1)[14] is an ES developed by General Electric Company. The purpose of DELTA/CATS-1 is to assist railroad personnel in the maintenance of General Electrics diesel-electric locomotives. An interesting feature of DELTA/CATS-1 is its interface with visual support systems. For example, schematics of the locomotive may be printed and a videodisk player can be used to show where particular components are located within the locomotive, as well as how to access and maintain these parts. Forecasting A forecast is a business function which attempts to predict sales and use of products so that they can be purchased or manufactured in appropriate quantities in advance[51]. Forecasting is an important logistics strategy in production management. EMEX[38] is a business forecasting system offered commercially by Expert System International. Another existing ES in forecasting is SMART FORECASTS II[38] by Smart software for selecting forecasting techniques. A promising and challenging area for improvement in forecasting lies in intelligent combination of forecasts obtained from different sources. An ES approach can be used in the area of forecasting; this might involve (say) a computerized exponential smoothing approach which would recursively generate new sets of forecasts until an agreeable forecast output is reached. This is the approach used in FOCUS forecasting[54]. The different sets of rules and conditions which administer how individual forecasts need to be combined can be part of the ES shell. NOSTRADAMUS[38] is another example of an ES which is used to select an appropriate forecasting technique for a specific forecasting task. Once a technique has been selected, the system provides suggestions to help a manager use the technique correctly. NOSTRADAMUS uses several criteria in the selection of a forecasting method including management preferences, type of forecast sought, data patterns validity and consistency, and product characteristics.

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Distribution Distribution is the management of the flow of materials from manufacturers to customers via warehouses. It may involve the storage and transportation of products. A fundamental choice in distribution is to locate stocking points of finished goods at distribution centres or warehouses and to determine the appropriate inventory levels. An ES would take into account different criteria, including transportation costs, fixed costs for opening of warehouses, processing cost to handle different products at the warehouses and scheduling a strategy to distribute the products to customers as part of its approach. The ES could then be used to locate the different warehouses and arrive at an efficient strategy to distribute multiple products subject to customer demand for the products. The DEC has developed ESs, such as the national dispatch router (NDR)[38] to assist in truck routeing, CDS, an order management system and DISPATCHER[38], a system developed for manufacturing support to assist in functional areas such as order management, material handling/warehousing and sourcing. DECs highly flexible component selection policy allows customers to specify systems that are tailored to their needs. Eastman Kodak[38] uses an ES to improve the case-picking productivity of its workers at its distribution centres. Purchasing Purchasing is the term used in industry and management to denote the function of and the responsibility for procuring materials, supplies and services[51]. Purchasing agents for many companies establish formal rating procedures to help them select new suppliers or periodically review the performance of current suppliers. An ES which takes into account the purchase criteria such as the price of products, the quality of a suppliers material and lead times and ontime delivery can be used to select a supplier, place the order for the product, track the order and receive the order of products. Lockheeds expert system ASAP[55] simplifies procurement requests for the end user and ensures accuracy of procurement requests. Some limitations of the ES to solve POM problems In the past few years, ESs have been developed to solve some of the important problems that exist in the POM literature. The drawback, however, in every instance has been the fact that ESs developed to date have tackled problems in very small domains. Dankel[56] provided a few common misconceptions that exist about ESs. Most operations management problems, however, are not isolated problems by their very nature. For example, to produce according to a given production schedule, the production manager interacts with marketing experts, quality control specialists, purchasing and several other departments in the organization. For manufacturing managers, their companies strategies, plans and forecasts are stated in terms of products and currencies, but these financial measures should be converted into component parts and quantities for the production schedule to be meaningful. Thus, isolated ESs cannot solve the

problem of the manufacturing manager. On the other hand, all the expertise of the manufacturing manager, financial manager, marketing manager, etc., cannot be put into the knowledge base of one ES owing to storage and time limitations. There are also other difficulties such as assuring integrity checking of the knowledge base and problems associated with updating the knowledge base. Hence, most systems have tackled these problems by designing isolated problem solvers in very specific domains. The relevant question that should be posed to ES designers is the ability of the ES or extensions of the ES to solve more practical organizational problems which consider the linkages between the several functional areas of the organization. For many of the ESs that have been implemented to solve POM problems, there remain serious questions concerning their implementation. Highly touted ESs such as XCON and DELTA have run into considerable difficulty. For example, the effects of XCON were not altogether predictable[57]. Although the system reduced the number of technical editors, this reduction was more than made up for by the large technical staff needed to develop and maintain XCON. The problems encountered in the implementation of ESs have not been a fault of the methodology but with those who have attempted to implement the methodology. However, if the methodology is understood and implemented properly, it can provide one with an exceptionally powerful and useful tool for dealing with a variety of important POM problems. Scope for future research ESs are good problem-solving tools for very specific domains. Most problems encountered in organizations are not of this type, and thus for ESs to be more effective problem solvers, the system architecture should be modified or redesigned to overcome this domain-specific limitation. Most of the ESs that have thus far been discussed and developed are essentially stand-alone systems. However, in the very near future it is likely that a large portion (if not the majority) of the ESs developed will be embedded systems, that is, systems that form a part of the overall software package. Hybrid ESs are one example of such an approach. Co-operative distributed problem solving is an area of AI which studies ways of solving problems by first decomposing the problem into subproblems. The subproblems are sent to specialized problem solvers (possibly an extension of a specialized ES) where there is an attempt to decompose them into comprehensible subunits. This phase corresponds to disaggregating the problem. Once the subproblems are solved, they are aggregated to result in a global solution to the problem. The implementation mechanisms of how this network of problem solvers can be realized have been studied to a lesser degree by computer science researchers. One study deals with the design of the HEARSAY system for speech understanding. Speech is disaggregated into parts and each subproblem tries to recognize a part of the speech. Other examples include medical diagnosis for which ESs in different branches of medicine communicate through a shared blackboard to solve problems. Each

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ES can post its result on the blackboard so that the other ES can use partial solutions on the blackboard if it is required in its problem solving. Another trend is we expected to continue is the increased development of smaller ESs ESs having 200 or fewer rules. If special problem solvers are developed for specific domains of OM and make it possible for the ES to share their results, more interesting problems can be broken into comprehensible units. A network where each node is a problem solver in a specific domain and the ability of the nodes to communicate and share results would result in overcoming several problems that have been created with the use of isolated ESs. With the advent of powerful, inexpensive ES shells and with implementation on the personal computer the development of small ESs is highly cost effective. More and more organizations are addressing small problems in order to obtain a quick pay-off for their investment in ESs which can be applied to their POM problems. In the future, ESs will find more application in the manufacturing area[58]. Ill-structured problems which are complex to solve using optimization methods will be solved by ESs. With the advent and rapid development of software and hardware, ESs methodology and techniques can be combined with other methods like optimization to provide a procedure to solve problems related to POM in a more effective and flexible way.
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