Feasibility analyses of distributed digital factories over traditional factories: case studies and comparison

Md Sazol Ahmmed, Sriram Praneeth Isanaka, Asad Waqar Malik, Muhammad Arif Mahmood and Frank Liou

Journal of Electronic Business & Digital Economics, 2025, vol. 4, issue 2, 220-245

Abstract: PurposeMany small and medium manufacturing companies face challenges with global competition due to limited access to advanced machinery and high overhead costs necessary to implement product-mandated line changes. To tackle this challenge, the concept of a distributed digital factory (DDF) has been proposed as compared to a traditional factory (TF).Design/methodology/approachThis research used multiple case studies to identify potential issues and propose and validate solutions using DDF and TF in various manufacturing scenarios to address global challenges like cost reduction, productivity and flexibility to meet uncertain demands. Finally, queuing and simulation models were developed for feasibility analysis on isolated co-located factory environments and DDFs to reduce production lead time or improve customer response. The model identified DDF and TF variables, efficiency and correlations using global balance conditions to measure performance.FindingsThis paper theorized and researched four cases to determine manufacturing costs and capacity. DDF saved 9 and 14% as compared to TF in the first and second cases, respectively. Compared to traditional methods, DDF reduced queue time by 22.95 and 26.32% in two distributed factory facilities in the third case. In the fourth case, DDF handled 99% product demand situations and TF 28%.Originality/valueThis paper is the first paper that investigates and researches the specific factors and scenarios through which a DDF setup becomes more efficient, productive and cost-effective through several cases and sensitivity analysis.

Keywords: Financial feasibility analysis; Distributed digital factories; Digital business; Simulation model; Queuing model; Digital operation management; Small and medium manufacturing industries (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eme:jebdep:jebde-01-2025-0002

DOI: 10.1108/JEBDE-01-2025-0002

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