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Much of the research in facility layout has focused on static layouts where the material handling¯ow is assumed to be constant during the planning horizon. But in today's market-based, dynamic environment, layout rearrangement may be required during the planning horizon to maintain layout e ectiveness. A few algorithms have been proposed to solve this problem. They include dynamic programming and pair-wise exchange. In this paper we propose an improved dynamic pair-wise exchange heuristic based on a previous method published in this journal. Tests show that the proposed method is e ective and e cient.

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