Operations Management Lesson 2 Facility Management

What you will learn in this unit: Facilities Management Location Decisions Layout Decisions Logistic Decisions Labour Decisions Technology Choice and Selection

Facilities Management Facilities management is the process of managing and improving capital investment of the organisation, these involves where to locate the operations, what are the layout to use, what logistic means that best for operations optimisation, who to engage to deliver the goods/services and what technologies to be utilised.

Location Decision Importance of location Location is the geographical positioning of an operation relative to the input resources, other operations or customers with which it interacts (Slack, 2001). Importance of location It have significant impact on cost Impact on speed of service Attracting labour Availability of raw materials

The location of operations Supply-side Demand-side Operation factors factors Labour costs Labour skills Land costs Suitability of site Energy costs Image Transportation costs Convenience for customers Community factors

Site Selection Factors Historical – corporate towns Inherent Local Conditions Climate Culture Ethics Language

Site Selection Factors Staffing Labour Costs Social Laws Labour Competency Productivity Trade Unions Education Level Technological Sophistication Labour Mix

Site Selection Factors Infrastructure Family Services Communications Environmental Regulations Legal Framework Transportation Rental costs Living Costs Country Stability

Site Selection Factors Construction Land Cost Construction Labour Land Preparation Expansion Possibilities Zoning Regulations Environmental Regulations Materials Availability

Site Selection Factors Cash Flow Considerations Exchange Rates Repatriation of Funds Taxes Financial Aid

Site Selection Factors Proximity of Resources Raw Materials Process & Utility Water Power Supply Suppliers & Subcontractors Convenience for Customers

Layout Decision Layout – deciding where to put all the facilities, machines, equipment & staff in an operation (Slack, 2001)

Why is layout design important? Require substantial investments of resources Involve long term commitments – not easily changed Impact on the cost & efficiency of short term operations

The facilities layout decision procedure Project process Volume and Decision 1 Jobbing process variety Batch process Process type Mass process Continuous process Decision 2 Strategic performance Fixed position layout objectives Basic layout type Process layout Cell layout Product layout Decision 3 Detailed design The physical position of all of layout transforming resources Flow of transformed resources

Basic layout types Volume Variety B asic layout types Manufacturing process types Service Fixed position layout Project processes Process layout Cell layout Product layout Jobbing processes Batch pro cesses Mass processes Continuous Professional services Service shops Mass services Volume Variety

Fixed Position Layout Transformed resources remain stationary Transforming resources move as necessary Effectiveness is governed by:- Scheduling of transforming resources Reliability of transforming resources Eg’s – shipbuilding, construction projects, some surgery, restaurant

Process Layout Similar processes (or with similar needs) are located together Utilisation of transforming resources is improved Transformed resources move through the operation according to their needs Different products  different needs  different routes May be very complex Eg’s – supermarkets, some machine manufacture

Cell Layout Machines or services grouped into cells Cells determined by the process requirements of the family of product/services they transform Could be considered mini product layouts Can simplify a functional/process layout Flexible Duplicates some resources

Product Layout Locates the transforming resources entirely for the convenience of the transformed resources Transformed resources follow a specified route Flow is clear, predictable, easy to control Eg’s – car assembly, paper manufacture, self-service cafe

olume-variety characteristics Fixed position layout Process layout Cell layout Product layout Low VOLUME High VARIETY

What makes a good layout Safety Length of flow Clarity of flow Staff comfort Management coordination Accessibility Space utilisation Long term flexibility

Logistic Decisions Logistic decision takes into consideration the flow of goods, information and financial resources therefore firms would have identify the necessary resources to support their operation.

Public Logistics Internal or Channel (Outbound) Logistics Information Logistics Supplier Logistics

Labour Decisions Labour decisions that focus on the human resources that help to ensure the operation process are optimise.

The process of determining the requirements of the job Job analysis The process of determining the requirements of the job

Job Analysis The process of developing a detailed description of the tasks and responsibilities involved in a job, determining the relationship of a given job to other jobs, and ascertaining the knowledge, skill and abilities necessary for an employee to perform the job successfully.

Tangible outcomes of job analysis Job description: A written description of a job, the types of duties performed and the conditions under which these duties are performed Person specification: Details the qualifications, experience and personal qualities required of suitable job-holders Job design: Concerns the satisfaction of the job holder’s needs

Human engineering Aims to identify and respond to worker needs in the performance of their jobs Adapts work environment and equipment to the person Can improve efficiency and create a more harmonious work environment

Job design strategies Job enlargement Job rotation Job enrichment Self-managing work teams Adjustments in work schedules

Technology Decision IT Technology Manufacturing technology Technology patents and processes R&D technology Material technology