A methodology is described for an automatic design system initially defined in terms of logical processes or program modules. Processes and files are grouped and reorganized in such a way as to produce an optimal design with respect to a specific target machine. Performance criteria for the optimal design are defined in terms of transport volume savings and core memory requirements. Starting with a graph theoretic representation of the interaction between processes (or modules) and files, the methodology consists of two components: (1) a generator of feasible alternatives and (2) a procedure for reorganization and core generation for specific groupings. Not only can an optimal design for the processing system be generated; but due to reorganization techniques, the resultant modules (defined from specific process groupings) may approach the computational efficiency expected of an integrated program. (Author)