This study describes a potential tool to evaluate the performance of Flexible Manufacturing Systems on the basis of both conventional design parameters (MTTF, MTTR, MTR) and other factors, including the use of the Markov process. System effectiveness is used as a performance measure, and credits are granted if only some of the systems are functional. To improve performance, a central storage, whose spares level is optimized heuristically, was installed to replenish spares for failing equipment. Such performance measurement technique is likely to be very useful for most real life FMS environments. The model is currently being tested for a wide range of applications.