9 - 1© 2011 Pearson Education, Inc. publishing as Prentice Hall Layout Design Considerations  Higher utilization of space, equipment, and people  Improved flow of information, materials, or people  Improved employee morale and safer working conditions  Improved customer/client interaction  Flexibility

9 - 2© 2011 Pearson Education, Inc. publishing as Prentice Hall Types of Layout 1.Office layout 2.Retail layout 3.Warehouse layout 4.Fixed-position layout 5.Process-oriented layout 6.Work-cell layout 7.Product-oriented layout

9 - 3© 2011 Pearson Education, Inc. publishing as Prentice Hall Layout Strategies ObjectivesExamples OfficeLocate workers requiring frequent contact close to one another Insurance & Banks, etc RetailExpose customer to high- margin items Supermarkets Cafes Department Stores Warehouse (storage) Balance low cost storage with low-cost material handling Freight depots Amazon distribution centre Project (fixed position) Move material to the limited storage areas around the site Ingall Ship Building Corp. Trump Plaza Pittsburgh Airport Table 9.1

9 - 4© 2011 Pearson Education, Inc. publishing as Prentice Hall Good Layouts Consider  Material handling equipment  (scope and operation)  Capacity and space requirements  (regulation compliance, plus usability)  Environment and aesthetics  (airflow, light, noise, privacy, etc)  Flows of information  (proximity of work stations, open spaces)  Issues of moving between various work areas (special conditions eg freezing/ hot)

9 - 5© 2011 Pearson Education, Inc. publishing as Prentice Hall Office Layout  Grouping of workers and workstations to provide comfort, safety, and movement of information  Movement of information is main factor.  Often changes with new technology.

9 - 6© 2011 Pearson Education, Inc. publishing as Prentice Hall Relationship Chart Figure 9.1

9 - 7© 2011 Pearson Education, Inc. publishing as Prentice Hall Supermarket Retail Layout  Objective is to maximize profitability per square metre of floor space  Sales and profitability vary directly with customer exposure to shelf items.  (the more obvious it is – the more people will buy it

9 - 8© 2011 Pearson Education, Inc. publishing as Prentice Hall Five Ideas for Supermarket Layout 1.Locate high-draw items around the outside of the store (milk, bread etc) 2.Use prominent locations for high-impulse and high- margin items (end of aisle plinths) 3.Distribute power items to both sides of an aisle and disperse them to increase viewing of other items 4.Convey mission of store through careful positioning of lead-off department (often fresh fruit & vege/ bakery).

9 - 9© 2011 Pearson Education, Inc. publishing as Prentice Hall Store Layout Figure 9.2

9 - 10© 2011 Pearson Education, Inc. publishing as Prentice Hall Warehousing and Storage Layouts  Objective is to optimize trade-offs between handling costs ( coding item. Storing item, picking item, tracking changes in stock level)  and storage costs (rent, power, insurance, etc – while in storage)  Aim is to maximize the total “cube” of the warehouse – use its full volume while keeping handling costs as low as possible.

9 - 11© 2011 Pearson Education, Inc. publishing as Prentice Hall Servicescapes 1.Ambient conditions - lighting, sound, smell, and temperature. 2.Spatial layout and functionality - customer flow planning, aisle characteristics, and product grouping. 3.Signs, symbols, and artifacts - features of building design that carry social significance and create the ‘ambience.’

9 - 12© 2011 Pearson Education, Inc. publishing as Prentice Hall Warehousing and Storage Layouts  All costs associated with the transaction  Incoming transport & unload  Storage  Finding and moving material in warehouse  Load & outgoing transport  Equipment, people, material, supervision, insurance, depreciation  Damage and spoilage Material Handling Costs

9 - 13© 2011 Pearson Education, Inc. publishing as Prentice Hall Warehousing and Storage Layouts  Warehouse density varies inversely with the number of different items stored  Automated Storage and Retrieval Systems (ASRSs) can improve warehouse productivity by 500%  Transport dock location is a key design element

9 - 14© 2011 Pearson Education, Inc. publishing as Prentice Hall Random Stocking  Random assignment of stocking locations allows more efficient use of space  Needs an automatic identification system (AISs) and effective information systems  Key tasks 1.Maintain list of open locations 2.Maintain accurate records 3.Sequence items to minimize travel, pick time 4.Combine picking orders 5.Assign classes of items to particular areas

9 - 15© 2011 Pearson Education, Inc. publishing as Prentice Hall Customizing  Value-added activities performed at the warehouse  Enable low cost and rapid response strategies  Assembly of components  Loading software  Repairs  Customized labeling and packaging

9 - 16© 2011 Pearson Education, Inc. publishing as Prentice Hall Shipping and receiving docks Office Customization Conveyor Storage racks Staging Warehouse Layout Traditional Layout

9 - 17© 2011 Pearson Education, Inc. publishing as Prentice Hall Warehouse Layout Cross-Docking Layout – aim is to minimise storage Shipping and receiving docks Office Shipping and receiving docks

9 - 18© 2011 Pearson Education, Inc. publishing as Prentice Hall Fixed-Position Layout  Product remains in one place  Workers & equipment move to it  Complicating factors  Limited space at site  Different materials used at different stages of the project  Volume of materials needed is dynamic

9 - 19© 2011 Pearson Education, Inc. publishing as Prentice Hall Alternative Strategy  As much of the project as possible is completed off-site in a product-oriented facility (pre-fabrication)  This can significantly improve efficiency but only when many of the same units are made.

9 - 20© 2011 Pearson Education, Inc. publishing as Prentice Hall Process-Oriented Layout (low volume / high variety)  Similar machines and equipment are grouped together  Flexible and capable of handling a wide variety of products or services  Scheduling can be difficult and setup, material handling, and labor costs can be high

9 - 21© 2011 Pearson Education, Inc. publishing as Prentice Hall Surgery Radiology ER triage room ER BedsPharmacy Emergency room admissions Billing/exit Laboratories Process-Oriented Layout Patient A - broken leg Patient B -erratic heart pacemaker Figure 9.3

9 - 22© 2011 Pearson Education, Inc. publishing as Prentice Hall Process-Oriented Layout  Arrange work centers so as to minimize the costs of material handling  Basic cost elements are  Number of loads (or people) moving between centers  Distance loads (or people) move between centers

9 - 23© 2011 Pearson Education, Inc. publishing as Prentice Hall Process-Oriented Layout Minimize cost = ∑ ∑ X ij C ij n i = 1 n j = 1 wheren=total number of work centers or departments i, j=individual departments X ij =number of loads moved from department i to department j C ij =cost to move a load between department i and department j

9 - 24© 2011 Pearson Education, Inc. publishing as Prentice Hall Process Layout Example 1.Construct a “from-to matrix” 2.Determine the space requirements 3.Develop an initial schematic diagram 4.Determine the cost of this layout 5.Try to improve the layout 6.Prepare a detailed plan Arrange six departments in a factory to minimize the material handling costs. Each department is 20 x 20 feet and the building is 60 feet long and 40 feet wide.

9 - 25© 2011 Pearson Education, Inc. publishing as Prentice Hall DepartmentAssemblyPaintingMachineReceivingShippingTesting (1)(2)Shop (3)(4)(5)(6) Assembly (1) Painting (2) Machine Shop (3) Receiving (4) Shipping (5) Testing (6) Number of loads per week Process Layout Example (from – to matrix) Figure 9.4

9 - 26© 2011 Pearson Education, Inc. publishing as Prentice Hall Area 1Area 2Area 3 Area 4Area 5Area 6 60’ 40’ Process Layout Example (space requirements) ReceivingShippingTesting DepartmentDepartmentDepartment (4)(5)(6) Figure 9.5 AssemblyPaintingMachine Shop DepartmentDepartmentDepartment (1)(2)(3)

9 - 27© 2011 Pearson Education, Inc. publishing as Prentice Hall Process Layout Example (initial schematic diagram) Interdepartmental Flow Graph Figure Machine Shop (3) Testing (6) Shipping (5) Receiving (4) Assembly (1) Painting (2)

9 - 28© 2011 Pearson Education, Inc. publishing as Prentice Hall Process Layout Example (calculate cost of layout) Cost =$50+$200+$40 (1 and 2)(1 and 3)(1 and 6) +$30+$50+$10 (2 and 3)(2 and 4)(2 and 5) +$40+$100+$50 (3 and 4)(3 and 6)(4 and 5) = $570 Cost = ∑ ∑ X ij C ij n i = 1 n j = 1

9 - 29© 2011 Pearson Education, Inc. publishing as Prentice Hall Process Layout Example (improve layout by moving stations) Revised Interdepartmental Flow Graph Figure Machine Shop (3) Testing (6) Shipping (5) Receiving (4) Painting (2) Assembly (1)

9 - 30© 2011 Pearson Education, Inc. publishing as Prentice Hall Process Layout Example (recalculate cost) Cost =$50+$100+$20 (1 and 2)(1 and 3)(1 and 6) +$60+$50+$10 (2 and 3)(2 and 4)(2 and 5) +$40+$100+$50 (3 and 4)(3 and 6)(4 and 5) = $480 Cost = ∑ ∑ X ij C ij n i = 1 n j = 1

9 - 31© 2011 Pearson Education, Inc. publishing as Prentice Hall Area 1Area 2Area 3 Area 4Area 5Area 6 60’ 40’ Process Layout Example ReceivingShippingTesting DepartmentDepartmentDepartment (4)(5)(6) Figure 9.8 Painting Assembly Machine Shop DepartmentDepartmentDepartment (2)(1)(3)

9 - 32© 2011 Pearson Education, Inc. publishing as Prentice Hall Computer Software in design  3-D visualization software allows managers to view possible layouts and assess process, material handling, efficiency, and safety issues

9 - 33© 2011 Pearson Education, Inc. publishing as Prentice Hall Work Cells  people and machines put into work stations for either single product or product groups.  Technology similarity is used as basis for particular cells (eg painting)  Cells can be changed as product designs or volume changes

9 - 34© 2011 Pearson Education, Inc. publishing as Prentice Hall Advantages of Work Cells 1.Reduced work-in-process inventory 2.Less floor space required 3.Reduced raw material and finished goods inventory (VC reduced) 4.Reduced direct labour (labour productivity up) 5.Heightened sense of employee participation (job design - enrichment, teamwork) 6.Increased use of equipment and machinery (capital productivity up) 7.Reduced investment in machinery and equipment (FC reduced)

9 - 35© 2011 Pearson Education, Inc. publishing as Prentice Hall Requirements of Work Cells 1.Identification of product ‘families’ 2.Highly trained, flexible and empowered employees 3.Each cell is self-contained, with its own equipment and resources 4.Test (poka-yoke) at each station in the cell

9 - 36© 2011 Pearson Education, Inc. publishing as Prentice Hall Work Balance Charts  Used for evaluating operation times in work cells  Can help identify bottleneck operations in a work line  Flexible, cross-trained employees can help address labor bottlenecks  Machine bottlenecks may require other approaches

9 - 37© 2011 Pearson Education, Inc. publishing as Prentice Hall Focused Work Center and Focused Factory  Focused Work Center  Identify a large family of similar products that have a large and stable demand  Moves production from a general-purpose, process-oriented facility to a large work cell  Focused Factory  A focused work cell in a separate facility  May be focused by product line, layout, quality, new product introduction, flexibility, or other requirements

9 - 38© 2011 Pearson Education, Inc. publishing as Prentice Hall Focused Work Center and Focused Factory Table 9.2 Work CellFocused Work CenterFocused Factory Work cell is a temporary product-oriented arrangement of machines and personnel in what is ordinarily a process- oriented facility A focused work center is a permanent product- oriented arrangement of machines and personnel in what is ordinarily a process-oriented facility A focused factory is a permanent facility to produce a product or component in a product- oriented facility. Many focused factories currently being built were originally part of a process-oriented facility A job shop with machinery and personnel rearranged to produce 300 unique control panels Pipe bracket manufacturing at a shipyard A plant to produce window mechanism for automobiles

9 - 39© 2011 Pearson Education, Inc. publishing as Prentice Hall Repetitive and Product- Oriented Layout 1.Volume is adequate for high equipment utilization 2.Product demand is stable enough to justify high investment in specialized equipment 3.Product is standardized or approaching a phase of life cycle that justifies investment 4.Supplies of raw materials and components are adequate and of uniform quality Organized around products or families of similar high-volume, low-variety products

9 - 40© 2011 Pearson Education, Inc. publishing as Prentice Hall Product-Oriented Layouts  Fabrication line  Builds components on a series of machines  Machine-paced  Require mechanical or engineering changes to balance  Assembly line  Puts fabricated parts together at a series of workstations  Paced by work tasks  Balanced by moving tasks Both types of lines must be balanced so that the time to perform the work at each station is the same

9 - 41© 2011 Pearson Education, Inc. publishing as Prentice Hall Product-Oriented Layouts 1.Low variable cost per unit 2.Low material handling costs 3.Reduced work-in-process inventories 4.Easier training and supervision 5.Rapid throughput Advantages 1.High volume is required 2.Work stoppage at any point ties up the whole operation 3.Lack of flexibility in product or production rates Disadvantages

9 - 42© 2011 Pearson Education, Inc. publishing as Prentice Hall Assembly-Line Balancing  Objective is to minimize the imbalance between machines or personnel while meeting required output  Starts with the precedence relationships  Determine cycle time  Calculate theoretical minimum number of workstations  Balance the line by assigning specific tasks to workstations

9 - 43© 2011 Pearson Education, Inc. publishing as Prentice Hall Wing Component Example PerformanceTask Must Follow TimeTask Listed Task(minutes)Below A10— B11A C5B D4B E12A F3C, D G7F H11E I3G, H Total time 66 I G F C D H B E A Figure 9.13

9 - 44© 2011 Pearson Education, Inc. publishing as Prentice Hall I G F C D H B E A Figure 9.13 PerformanceTask Must Follow TimeTask Listed Task(minutes)Below A10— B11A C5B D4B E12A F3C, D G7F H11E I3G, H Total time 66 Wing Component Example 480available mins per day 40units required Cycle time = Production time available per day Units required per day = 480 / 40 = 12 minutes per unit Minimum number of workstations = ∑ Time for task i Cycle time n i = 1 = 66 / 12 = 5.5 or 6 stations

9 - 45© 2011 Pearson Education, Inc. publishing as Prentice Hall Wing Component Example I G F C D H B E A Figure 9.13 PerformanceTask Must Follow TimeTask Listed Task(minutes)Below A10— B11A C5B D4B E12A F3C, D G7F H11E I3G, H Total time available mins per day 40units required Cycle time = 12 mins Minimum workstations = 5.5 or 6 Line-Balancing Heuristics 1.Longest task timeChoose the available task with the longest task time 2.Most following tasksChoose the available task with the largest number of following tasks 3.Ranked positional weight Choose the available task for which the sum of following task times is the longest 4.Shortest task timeChoose the available task with the shortest task time 5.Least number of following tasks Choose the available task with the least number of following tasks Table 9.4

9 - 46© 2011 Pearson Education, Inc. publishing as Prentice Hall 480available mins per day 40units required Cycle time = 12 mins Minimum workstations = 5.5 or 6 PerformanceTask Must Follow TimeTask Listed Task(minutes)Below A10— B11A C5B D4B E12A F3C, D G7F H11E I3G, H Total time 66 Station 1 Wing Component Example Station 2 Station 3 Station 4 Station 5 Station 6 I GF H C D B E A Figure 9.14

9 - 47© 2011 Pearson Education, Inc. publishing as Prentice Hall PerformanceTask Must Follow TimeTask Listed Task(minutes)Below A10— B11A C5B D4B E12A F3C, D G7F H11E I3G, H Total time 66 Wing Component Example 480available mins per day 40units required Cycle time = 12 mins Minimum workstations = 5.5 or 6 Efficiency = ∑ Task times (Actual number of workstations) x (Largest cycle time) = 66 minutes / (6 stations) x (12 minutes) = 91.7%