Mass productio!l and mass consumption, so far considered virtues in a free economic soceity, have changed. Various problems have occurred including economic stagnation, energy crisis, shortage of material resources, prolifera­ tion of pollution, lack of skilled labor, rapid changes of product design, technical innovation, and others. Moreover, individual manufacturing firms must take steps to adopt multi-product, small-lot-sized (batch type) produc­ tion as a type of production in order to adapt themselves to a market movement characterized by a diversified and specialty-oriented society and a short product life cycle. The number of manufacturing firms worldwide that use a type of multi-product, small-lot-sized production is expected to increase. This is so even in the United States, which has been said to be a country of mass production. Multi-product, small-lot-sized production has been considered to be a milestone to flow-type mass production, which has been thought to be the most effective production system. Intensive efforts have been made to investigate mass production systems from both theoretical and practical viewpoints. Few studies have been made for multi-product, small-lot-sized production (batch-type manufacturing). Considering the present business circumstances faced with various difficulties, it is strongly required to establish some theories useful for making practically effective and flexible multi-product, small-lot-sized production systems. Several effective approaches to the batch-type manufacturing systems have been developed. Group technology (GT) is one such method that has steadily obtained great interest from progressive manufacturing firms all over the world.