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OPERATIONS MANAGEMENT: Creating Value Along the Supply Chain,
Canadian Edition Robert S. Russell, Bernard W. Taylor III, Ignacio Castillo, Navneet Vidyarthi CHAPTER 7 Capacity and Facilities Design
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Learning Objectives Discuss long-term capacity planning strategies.
Indicate the benefits of effective facility layout. Explain the general characters of process, product, and fixed-position facility layouts. Use block diagramming and relationship diagramming to design process layouts. Describe the general considerations for service layouts. Design a simple product layout for efficiency (balance basic assembly line). Describe three types of hybrid layouts, including cellular layouts, flexible manufacturing systems, and mixed-model assembly lines.
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Copyright 2014 John Wiley & Sons Canada, Ltd.
Lecture Outline Capacity Planning Basic Layouts Designing Process Layouts Designing Service Layouts Designing Product Layouts Hybrid Layouts Copyright 2014 John Wiley & Sons Canada, Ltd.
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Copyright 2014 John Wiley & Sons Canada, Ltd.
Capacity Maximum capability to produce Capacity planning establishes overall level of productive resources for a firm 3 basic strategies for timing of capacity expansion in relation to steady growth in demand Lead Lag average Copyright 2014 John Wiley & Sons Canada, Ltd.
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Capacity Expansion Strategies
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Copyright 2014 John Wiley & Sons Canada, Ltd.
Capacity Capacity increase depends on volume and certainty of anticipated demand strategic objectives costs of expansion and operation Best operating level % of capacity use that minimizes unit costs Capacity cushion % of capacity held in reserve for unexpected occurrences Copyright 2014 John Wiley & Sons Canada, Ltd.
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Copyright 2014 John Wiley & Sons Canada, Ltd.
Economies of Scale Unit cost decreases as output volume increases fixed costs can be spread over a larger number of units production or operating costs do not increase linearly with output levels quantity discounts are available for material purchases operating efficiency increases as workers gain experience Copyright 2014 John Wiley & Sons Canada, Ltd.
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Best Operating Level for a Hotel
Copyright 2014 John Wiley & Sons Canada, Ltd.
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Objectives of Facility Layout
Minimize movement and material-handling costs Use space efficiently Use labour efficiently Eliminate bottlenecks Facilitate communication and interaction between workers between workers and their supervisors between workers and customers Reduce manufacturing cycle time and customer service time Copyright 2014 John Wiley & Sons Canada, Ltd.
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Objectives of Facility Layout
Eliminate wasted or redundant movement Facilitate the entry, exit, and placement of material, products, and people Incorporate safety and security measures Promote product and service quality Encourage proper maintenance activities Provide a visual control of activities Provide flexibility to adapt to changing conditions Increase capacity Copyright 2014 John Wiley & Sons Canada, Ltd.
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Copyright 2014 John Wiley & Sons Canada, Ltd.
Basic Layouts Process layouts group similar activities together according to process or function they perform Product layouts arrange activities in line according to sequence of operations for a particular product or service Fixed-position layouts are used for projects in which product cannot be moved Copyright 2014 John Wiley & Sons Canada, Ltd.
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Process Layout in Services
Women’s lingerie Women’s dresses Women’s sportswear Shoes Cosmetics and jewelry Entry and display area Housewares Children’s department Men’s department Copyright 2014 John Wiley & Sons Canada, Ltd.
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Manufacturing Process Layout
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Copyright 2014 John Wiley & Sons Canada, Ltd.
A Product Layout In Out Copyright 2014 John Wiley & Sons Canada, Ltd.
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Comparison of Product and Process Layouts
Description Type of process Product Demand Volume Equipment Sequential arrangement of activities Continuous, mass production, mainly assembly Standardized, made to stock Stable High Special purpose Functional grouping of activities Intermittent, job shop, batch production, mainly fabrication Varied, made to order Fluctuating Low General purpose Copyright 2014 John Wiley & Sons Canada, Ltd.
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Comparison of Product and Process Layouts
Workers Inventory Storage space Material handling Aisles Scheduling Layout decision Goal Advantage Limited skills Low in-process, high finished goods Small Fixed path (conveyor) Narrow Part of balancing Line balancing Equalize work at each station Efficiency Varied skills High in-process, low finished goods Large Variable path (forklift) Wide Dynamic Machine location Minimize material handling cost Flexibility Copyright 2014 John Wiley & Sons Canada, Ltd.
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Fixed-Position Layouts
Typical of projects Fragile, bulky, heavy items Equipment, workers & materials brought to site Low equipment utilization Highly skilled labor Typically low fixed cost Often high variable costs Copyright 2014 John Wiley & Sons Canada, Ltd.
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Designing Process Layouts
Goal: minimize material handling costs Block Diagramming minimize nonadjacent loads use when quantitative data is available Relationship Diagramming based on location preference between areas use when quantitative data is not available Copyright 2014 John Wiley & Sons Canada, Ltd.
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Copyright 2014 John Wiley & Sons Canada, Ltd.
Block Diagramming Unit load quantity in which material is normally moved Nonadjacent load distance farther than the next block Steps create load summary chart calculate composite (two way) movements develop trial layouts minimizing number of nonadjacent loads Copyright 2014 John Wiley & Sons Canada, Ltd.
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Block Diagramming: Example
Department Load Summary Chart FROM/TO DEPARTMENT 1 — 2 — — 40 50 — 60 — 1 2 3 4 5 Copyright 2014 John Wiley & Sons Canada, Ltd.
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Block Diagramming: Example
loads loads loads loads loads loads loads loads loads loads 1 2 3 4 5 100 200 150 50 60 40 110 Grid 1 Nonadjacent Loads =150 Copyright 2014 John Wiley & Sons Canada, Ltd.
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Block Diagramming: Example
loads loads loads loads loads loads loads loads loads loads 1 2 3 4 5 100 200 150 50 60 40 110 Grid 2 Nonadjacent Loads: 0 Copyright 2014 John Wiley & Sons Canada, Ltd.
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Block Diagramming: Example
type of schematic layout diagram; includes space requirements (a) Initial block diagram (b) Final block diagram 1 2 3 4 5 Copyright 2014 John Wiley & Sons Canada, Ltd.
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Block Diagramming With Excel
Input load summary chart and trial layout Try different layout configurations Excel will calculate composite movements and nonadjacent loads Copyright 2014 John Wiley & Sons Canada, Ltd.
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Relationship Diagramming
Schematic diagram that uses weighted lines to denote location preference Muther’s grid format for displaying manager preferences for department locations Copyright 2014 John Wiley & Sons Canada, Ltd.
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Relationship Diagramming
Production Offices Stockroom Shipping and receiving Locker room Toolroom A O U E X I A Absolutely necessary E Especially important I Important O Okay U Unimportant X Undesirable Copyright 2014 John Wiley & Sons Canada, Ltd.
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Relationship Diagramming
Offices Locker room Shipping and receiving Key: A E I O U X Stockroom Toolroom Production (a) Relationship diagram of original layout Copyright 2014 John Wiley & Sons Canada, Ltd.
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Relationship Diagramming
Offices Stockroom Locker room Toolroom Shipping and receiving Production Key: A E I O U X (b) Relationship diagram of revised layout Copyright 2014 John Wiley & Sons Canada, Ltd.
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Computerized Layout Solutions
CRAFT Computerized Relative Allocation of Facilities Technique CORELAP Computerized Relationship Layout Planning PROMODEL and EXTEND visual feedback allow user to quickly test a variety of scenarios Three-D modeling and CAD integrated layout analysis available in VisFactory and similar software Copyright 2014 John Wiley & Sons Canada, Ltd.
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Designing Service Layouts
Must be both attractive and functional Free-flow layouts encourage browsing, increase impulse purchasing, are flexible and visually appealing Grid layouts encourage customer familiarity, are low cost, easy to clean and secure, and good for repeat customers Loop and Spine layouts both increase customer sightlines and exposure to products, while encouraging customer to circulate through the entire store Copyright 2014 John Wiley & Sons Canada, Ltd.
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Copyright 2014 John Wiley & Sons Canada, Ltd.
Types of Store Layouts This slide needs a new diagram Copyright 2014 John Wiley & Sons Canada, Ltd.
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Designing Product Layouts
Objective Balance the assembly line Line balancing tries to equalize the amount of work at each workstation Precedence requirements physical restrictions on the order in which operations are performed Cycle time maximum amount of time a product is allowed to spend at each workstation Copyright 2014 John Wiley & Sons Canada, Ltd.
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Cycle Time Example Cd = Cd = = 4 minutes production time available
desired units of output (8 hours x 60 minutes / hour) (120 units) Cd = = 4 minutes 480 120 Copyright 2014 John Wiley & Sons Canada, Ltd.
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Flow Time vs Cycle Time Cycle time = max time spent at any station
Flow time = time to complete all stations 1 2 3 4 minutes Flow time = = 12 minutes Cycle time = max (4, 4, 4) = 4 minutes Copyright 2014 John Wiley & Sons Canada, Ltd.
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Efficiency of Line and Balance Delay
j i = 1 Balance delay total idle time of line = nCa - ti nCa E = Efficiency j i = 1 j i = 1 Cd N = Min# of workstations ti ti where ti = completion time for element i j = number of work elements n = actual number of workstations Ca = actual cycle time Cd = desired cycle time Copyright 2014 John Wiley & Sons Canada, Ltd.
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Line Balancing Procedure
Draw and label a precedence diagram Calculate desired cycle time required for line Calculate theoretical minimum number of workstations Group elements into workstations, recognizing cycle time and precedence constraints Calculate efficiency of line Determine if theoretical minimum number of workstations or an acceptable efficiency level has been reached. If not, go back to step 4. Copyright 2014 John Wiley & Sons Canada, Ltd.
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Copyright 2014 John Wiley & Sons Canada, Ltd.
Line Balancing Work Element Precedence Time (Min) A Press out sheet of fruit — 0.1 B Cut into strips A 0.2 C Outline fun shapes A 0.4 D Roll up and package B, C 0.3 0.1 0.2 0.4 0.3 D B C A Copyright 2014 John Wiley & Sons Canada, Ltd.
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Copyright 2014 John Wiley & Sons Canada, Ltd.
Line Balancing Work Element Precedence Time (Min) A Press out sheet of fruit — 0.1 B Cut into strips A 0.2 C Outline fun shapes A 0.4 D Roll up and package B, C 0.3 Cd = = = 0.4 minute 40 hours x 60 minutes / hour 6,000 units 2400 6000 N = = = 2.5 3 workstations 1.0 0.4 Copyright 2014 John Wiley & Sons Canada, Ltd.
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Copyright 2014 John Wiley & Sons Canada, Ltd.
Line Balancing Remaining Remaining Workstation Element Time Elements 1 A 0.3 B, C B 0.1 C, D 2 C 0.0 D 3 D 0.1 none 0.1 0.2 0.4 0.3 D B C A Cd = 0.4 N = 2.5 Copyright 2014 John Wiley & Sons Canada, Ltd.
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Copyright 2014 John Wiley & Sons Canada, Ltd.
Line Balancing A, B C D Work station 1 Work station 2 Work station 3 0.3 minute 0.4 minute Cd = 0.4 N = 2.5 E = = = = 83.3% 3(0.4) 1.0 1.2 Copyright 2014 John Wiley & Sons Canada, Ltd.
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Computerized Line Balancing
Use heuristics to assign tasks to workstations Longest operation time Shortest operation time Most number of following tasks Least number of following tasks Ranked positional weight Copyright 2014 John Wiley & Sons Canada, Ltd.
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Copyright 2014 John Wiley & Sons Canada, Ltd.
Hybrid Layouts Cellular layouts group dissimilar machines into work centers (called cells) that process families of parts with similar shapes or processing requirements Production flow analysis (PFA) reorders part routing matrices to identify families of parts with similar processing requirements Flexible manufacturing system automated machining and material handling systems which can produce an enormous variety of items Mixed-model assembly line processes more than one product model in one line Copyright 2014 John Wiley & Sons Canada, Ltd.
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Copyright 2014 John Wiley & Sons Canada, Ltd.
Cellular Layouts Identify families of parts with similar flow paths Group machines into cells based on part families Arrange cells so material movement is minimized Locate large shared machines at point of use Copyright 2014 John Wiley & Sons Canada, Ltd.
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Parts Families A family of similar parts
A family of related grocery items Copyright 2014 John Wiley & Sons Canada, Ltd.
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Original Process Layout
B Raw materials Assembly 1 2 3 4 5 6 7 8 9 10 11 12 Copyright 2014 John Wiley & Sons Canada, Ltd.
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Copyright 2014 John Wiley & Sons Canada, Ltd.
Part Routing Matrix Machines Parts A x x x x x B x x x x C x x x D x x x x x E x x x F x x x G x x x x H x x x Copyright 2014 John Wiley & Sons Canada, Ltd.
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Revised Cellular Layout
3 6 9 Assembly 1 2 4 8 10 5 7 11 12 A B C Raw materials Cell 1 Cell 2 Cell 3 Copyright 2014 John Wiley & Sons Canada, Ltd.
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Reordered Routing Matrix
Machines Parts A x x x x x D x x x x x F x x x C x x x G x x x x B x x x x H x x x E x x x Copyright 2014 John Wiley & Sons Canada, Ltd.
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A Manufacturing Cell with Worker Paths
Copyright 2014 John Wiley & Sons Canada, Ltd.
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Copyright 2014 John Wiley & Sons Canada, Ltd.
Cellular Layouts Advantages Reduced material handling and transit time Reduced setup time Reduced work-in- process inventory Better use of human resources Easier to control Easier to automate Disadvantages Inadequate part families Poorly balanced cells Expanded training and scheduling of workers Increased capital investment Copyright 2014 John Wiley & Sons Canada, Ltd.
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Automated Manufacturing Cell
Copyright 2014 John Wiley & Sons Canada, Ltd.
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Flexible Manufacturing Systems (FMS)
Consists of programmable machine tools automated tool changing automated material handling system controlled by computer network Combines flexibility with efficiency Layouts differ based on variety of parts the system can process size of parts processed average processing time required for part completion Copyright 2014 John Wiley & Sons Canada, Ltd.
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Fully-Implemented FMS
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Mixed Model Assembly Lines
Produce multiple models in any order on one assembly line Factors in mixed model lines Line balancing U-shaped lines Flexible workforce Model sequencing Copyright 2014 John Wiley & Sons Canada, Ltd.
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Balancing U-Shaped Lines
Precedence diagram: Cycle time = 12 min A,B C,D (a) Balanced for a straight line 9 min 12 min 3 min Efficiency = = = = 66.7 % 24 36 3(12) 12 min 12 min (b) Balanced for a U-shaped line 2(12) Efficiency = = = 100 % Copyright 2014 John Wiley & Sons Canada, Ltd.
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Copyright 2014 John Wiley & Sons Canada, Ltd.
Copyright © 2014 John Wiley & Sons Canada, Ltd. All rights reserved. Reproduction or translation of this work beyond that permitted by Access Copyright (The Canadian Copyright Licensing Agency) is unlawful. Requests for further information should be addressed to the Permissions Department, John Wiley & Sons Canada, Ltd. The purchaser may make back-up copies for his or her own use only and not for distribution or resale. The author and the publisher assume no responsibility for errors, omissions, or damages caused by the use of these programs or from the use of the information contained herein. Copyright 2014 John Wiley & Sons Canada, Ltd.
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