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Abstract: In this global manufacturing era, one of the important challenges faced by manufacturer is how to deal with stochastic demand and ever changing customer needs and requirements. Reconfigurable manufacturing systems are recognized as next generation manufacturing systems capable of providing the exact functionality and capacity as and when required. Some important performance indices studied in the past include cost, ease of reconfigurability, productivity, reliability and availability for assessing the performance of these systems. The economics while carrying out the reconfiguration process of these systems must include parameters such as cost incurred while producing orders of part families on a particular configuration and the reconfiguration cost associated while changing over from initial configuration to another. The complexity and cost involved from changing one configuration to another depends on the existing initial configuration and the new configuration required for subsequent production. In this paper, based on the different efforts associated with the reconfiguration process, a new index of performance termed as “Service Level” is proposed. The proposed indicator is modeled for a multiple part family reconfigurable manufacturing system. The methodology proposed is explained using a numerical example. The results obtained along with their important implications were discussed. [Copyright &y& Elsevier]