AbstractRecently, Group Technology (GT) as a batch manufacturing innovation has commanded much research attention and pragmatic interest. This approach to small lot production is based on identifying and exploiting similarities. By grouping items which share common traits, GT facilitates the rationalization of activities in a wide variety of functional areas including purchasing, design, and manufacturing. When GT is used in manufacturing one potential application involves the creation and operation of production cells. A production or manufacturing cell is a group of functionally dissimilar machines that are placed together and dedicated to the manufacture of a specific range of component parts. The usefulness of cellular manufacturing is demonstrated by the impressive catalog of benefits reported by its users both in the US and abroad. Reductions in work‐in‐process and finished goods inventories, decreases in production lead time, better delivery performance, improved product quality, and an overall increase in productivity are but a few of the benefits reportedly accruing to the use of cells.While it appears that cellular manufacturing can significantly improve the operation of batch production, an important component of the GT cellular production system has, unfortunately, been overlooked. Little study has been devoted to the human aspects of the use of production cells. The research reported in this paper attempts to fill this void by systematically examining the effect of cellular production on batch manufacturing employees. The research site was a medium size plant in which a portion of the functionally arranged facilities had recently been converted to a cellular layout. Both functional and cellular workers responded to a questionnaire designed to assess employee perceptions of their jobs, their job satisfaction, and their performance. In contrast to the findings of earlier (ethnographic) studies, cellular manufacturing employees did not perceive greater autonomy, significance, identity, or cohesiveness in their jobs than workers in traditional functional jobs. Cell workers also were as satisfied with their jobs, supervision, and advancement opportunities as non‐cell workers, but were more satisfied with their pay. Supervisory ratings of performance did not vary between groups.The major contributions of this article are threefold. First, this research represents the first attempt to scientifically evaluate the human impact of cellular manufacturing. Second, in contradicting the findings of earlier descriptive studies, all of which emphasize the very positive human consequences of cellular production, the need for additional research which challenges initial intuitive presumptions is clearly indicated. Third, and perhaps most importantly, the findings of this exploratory study suggest that cellular manufacturing does not have a negative impact on worker performance, attitudes, or satisfaction. A ramification of this is that reductions in work‐in‐process and finished goods inventories, decreases in production lead time, and improved overall productivity which reportedly accompany the implementation of cellular manufacturing may be achieved without any human fallout.