Module on Layout & Facilities Planning

2 Operations Management: Layout & Facilities Planning In this module we will discuss: Layout types Employee & customer considerations Steps in layout planning Manufacturing & service layout Contemporary layout issues

3 Operations Management: Layout & Facilities Planning 1.Layout planning is concerned with placement of departments, working groups, machines, and stockholding points within a production facility. The objective is to arrange the elements in a way that facilitates smooth work flow ( in manufacturing) or a particular traffic pattern ( in service). 2.Layout planning is the integral part of design of the productive system. It is a physical expression of technological choices, capacity decisions, process & job design, material handling and communication system that joins the processes.

4 Operations Management: Layout & Facilities Planning Types of Layouts: Fixed position layout Process layout Product layout Cellular layout

5 Operations Management: Layout & Facilities Planning Process Choices Project Jobbing Batch Line Continuous Building Dams Special, Small Orders Mid Volume Production High Volume Productions SmallLarge Average Order Size

6 Operations Management: Layout & Facilities Planning Attributes of Projects Applications: Usually large, one of kind Order Winners: Price or Capability Physical Resources: General purpose, mobile Human Resources: Project skills, outsourcing Information System: Tracking oriented Project costing Inventory: Timely Raw, sizable WIP, little FG Adaptability to Change: High within charter

Fixed Position Layout Question: What are our primary considerations for a fixed position layout? Answer: Arranging materials and equipment concentrically around the production point in their order of use.

8 Operations Management: Layout & Facilities Planning Fixed Position (Project) Layout Suitable for large projects (shipbuilding, missile/aircraft assembly, dam building) Assembly is the main process Functional centres arranged around project Functional areas may be inventory storage or some form of fabrication Proximity of functional area depends upon frequency of use/ travel time

9 Operations Management: Layout & Facilities Planning Process (Functional) Layout Used when competitive priorities are flexibility & quality Lot size Q is low & number of products/parts P high Similar equipment/functions are grouped together Variable routes between job centres Variable processing time at centres Waiting line (queue) at each centre Enhances learning & skill development Distances the supplier from the customer* Examples: machine shop, job order shop, hospital,consultancy organization

10 Operations Management: Layout & Facilities Planning Typical Attributes Of Jobbing Applications: Special, Small, Make-to-Orders Order Winners: Price, Speed or Capability Physical Resources: General purpose equipment, process layout Human Resources: Skilled, empowered, may be labor limited Inventory: Timely Raw, sizable WIP, little FG Adaptability to Change: High within charter

11 Operations Management: Layout & Facilities Planning Job Shop : Process Layout Office Final Assembly Loading Dock Milling Machines Drill Presses Plant Maintenance Welding Shop Tool Storage Boring Machines Paint Booths Coffee

12 Operations Management: Layout & Facilities Planning Cellular Manufacturing Cellular manufacturing is a category of manufacturing processes that produce a family of similar outputs, one at a time, by linking together all possible operations in the required process. Whereas a job shop is designed to process a wide variety of product, the scope of a cell is limited to a subset of parts with similar processing characteristics. This subset of similar parts is called a parts family.

13 Parts Families

14 Operations Management: Layout & Facilities Planning Cellular (Group Technology) Layout Lot size Q & number of products/parts P are both moderate Allocates dissimilar machines in to cells to produce products having similar shapes/ processing requirements (e.g. all small gears) Objective is to get benefit of product layout in job- shop production Better teamwork & human relations Improved operator efficiency, less in-process inventory, material handling, faster production due to faster tooling changes

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16 Cell 3 LM G G Cell 1 Cell 2 Assembly area A A L M D L L M Shipping D Receiving G Line flows in a job shop with three GT cells

Group Technology: Transition from Process Layout 1. Grouping parts into families that follow a common sequence of steps. 2. Identifying dominant flow patterns of parts families as a basis for location or relocation of processes. 3. Physically grouping machines and processes into cells.

Group Technology: Benefits 1. Better human relations 2. Improved operator expertise 3. Less in-process inventory and material handling 4. Faster production setup

19 Operations Management: Layout & Facilities Planning Product Layout Focus on product Lot size Q is large w.r.t. number of products/parts P More suited to assembly than fabrication If same process is required elsewhere, facility is duplicated Adequate volume for equipment utilization Stable, long-term product demand Product standardization Continuous flow of materials Throughput time & material handling minimized

20 Operations Management: Layout & Facilities Planning Typical Attributers Of Line Production Applications: High Volume MTS Jobs Order Winners: Often Price and capability Physical Resources: Special purpose fixed product layout Human Resources: Toward less skilled, unionized Bureaucratic Information System: Material and process control, process costing Inventory: Timely Raw, sizable WIP & FG Adaptability to Change: Low

21 Operations Management: Layout & Facilities Planning Service Facility Layout Service Types-Fixed / Delivered Services Fixed- Consumption at delivery point E.g. restaurant, bank, health care & hospital Layout is crucial for fast service In direct customer contact service- analyze waiting line structure

22 Operations Management: Layout & Facilities Planning Service Facility Layout (cont..) Entry flow & Exit flow should planned Exit flow should not clash with waiting line Fast-food, standardized, high volume office work- production line layout Banks, general offices-functional layout

23 Operations Management: Layout & Facilities Planning Facilities Location Problem Suppose there are 4 functions A,B,C,D How should they be located? Should it be AB D C AC D B AD B C AB C D

24 Operations Management: Layout & Facilities Planning Inputs to layout decisions: Estimates for product/service demand Space required for layout elements Distance travelled by product & amount of flow between elements in layout Processing requirements Space available within & outside facility Building configuration

25 Process Layout: Interdepartmental Flow Given – The flow (number of moves) to and from all departments – The cost of moving from one department to another – The existing or planned physical layout of the plant Determine – The “best” locations for each department, where best means interdepartmental transportation, or flow, costs

26 Process Layout: CRAFT Approach It is a heuristic program; it uses a simple rule of thumb in making evaluations: – "Compare two departments at a time and exchange them if it reduces the total cost of the layout." It does not guarantee an optimal solution. CRAFT assumes the existence of variable path material handling equipment such as forklift trucks.

27 Process Layout: Systematic Layout Planning Numerical flow of items between departments – Can be impractical to obtain – Does not account for the qualitative factors that may be crucial to the placement decision Systematic Layout Planning – Accounts for the importance of having each department located next to every other department – Is also guided by trial and error Switching departments then checking the results of the “closeness” score

28 Example of Systematic Layout Planning: Reasons for Closeness Code Reason Type of customer Ease of supervision Common personnel Contact necessary Share same price Psychology

29 Example of Systematic Layout Planning: Importance of Closeness Value A E I O U X Closeness Line code Numerical weights Absolutely necessary Especially important Important Ordinary closeness OK Unimportant Undesirable

30 Example of Systematic Layout Planning: Relating Reasons and Importance From 1. Credit department 2. Toy department 3. Beverage department 4. Camera department 5. Chocolate department 6 I -- U 4 A U U 1 I 1,6 A -- U 1 X 1 X To Area (sq. ft.) Letter Number Closeness rating Reason for rating

31 Example of Systematic Layout Planning: Initial Relationship Diagram U U A A I

33 Example of Systematic Layout Planning: Initial Layout(ignoring space constraints)

34 Example of Systematic Layout Planning: Initial and Final Layouts Initial Layout Ignoring space and building constraints ft 20 ft Final Layout Adjusted by square footage and building size

35 Operations Management: Layout & Facilities Planning Layout Planning Steps Arrange work centres in order of dominant flow (objective is to ensure resource/product flow at optimum cost/time) Analyze product/resource flow ( Flow diagram/ From-To diagram) Include non-flow factors & combine with flow factors Determine space requirements Fit space arrangement into available space

36 Operations Management: Layout & Facilities Planning Layout Planning Steps Arrange work centres in order of dominant flow (objective is to ensure resource/product flow at optimum cost/time) Analyze product/resource flow ( Flow diagram/ From-To diagram) Include non-flow factors & combine with flow factors Determine space requirements Fit space arrangement into available space

37 Analyze product/ resource flow Flow diagram From-to chart Identify non-flow factors, Where significant Activity-Relationship diagram Assess data and arrange work area Activity arrangement diagram Determine space arrangement plan Space relationship diagram Fit space arrangement in to available space Floor plan Detailed layout plan

38 Operations Management: Layout & Facilities Planning Thank you