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• This may be again a good time to reinforce the point that all of an organization’s strategies must work together.
• In addition to discussing what facility layout is, you might also raise some of the issues that may make it problematic.
• May be useful here to present a brief discussion of each benefit.
• Students should be asked if they perceive the relative importance of these requirements to be changing with the increased use of automated information technology.
• Having discussed each of these constraints in turn, you might ask students what other constraints they might expect to find in a practical situation.
• Students should be able to supply examples of the use of this layout strategy.
• Students should be asked to suggest additional limitations or complications related to the fixed-positions layout
• Students should be asked to suggest why this is not our “standard” layout - at least where the product is movable or transportable.
• Students may be asked to evaluate alternative layouts for an emergency room. Perhaps a visit to view a local emergency room might be helpful.
• The criterion for this methodology is basically a number-of-parts (or people)-times-distance measure. Is this always useful or appropriate?
• Now that cost can be determined, ask students (1) whether this is an appropriate criteria, and (2) how they would go about minimizing cost.
• Note that the matrix above basically measures the flow between sites, direction is immaterial. We can also develop entries for the remainder of the matrix if a different cost or route applies depending upon whether one is coming or going.
• It is probably useful to note that these programs operate on the basis of heuristics - and do not necessarily produce the optimal answer.
• Students should be asked to comment upon the technology required to implement the concept of work cells. Under what conditions is such a cellular arrangement possible?
• Students should be reminded here to consider both the advantages and the disadvantages. They might also be asked to consider why this approach might require a larger capital investment and result in a lower machine utilization than other approaches (Green and Sadowski).
• Students should be asked to consider if worker union activities have an impact on the organization’s ability to use cellular production.
• The more focused the plant, the larger the number of product lines for equivalent sales performance.
• This slide could be used to initiate a discussion of layout designed around product flow as opposed to layout designed around information flow.
• Students should be asked for examples of features they find common to the design of retail layouts with which they are familiar.
• Students can be asked to provide examples of instances in which these rules were implemented.
• Some of the options to be considered when developing a random stocking system
• Students should be asked to suggest the conditions under which a product-oriented layout is most appropriate.
• Some answers to the previous question.
• Having discussed the individual assumptions, one should then turn to the question of what is “adequate,” or “enough,” i.e., how does one go about making these decisions.
• Students should be aware that it is best to run balanced assembly lines - if they are not, then the need for balancing should be covered before discussing the process.
• Students should be walked through an example in class. One of the most useful examples is typically the student registration system. Students are familiar with it, they are able to estimate task time, and they are certainly impacted by the overall process,
• ### Layout

1. 1. Layout Strategy
2. 2. Objectives of the Layout Strategy <ul><li>Develop an economical layout which will meet the requirements of: </li></ul><ul><ul><li>product design and volume (product strategy) </li></ul></ul><ul><ul><li>process equipment and capacity (process strategy) </li></ul></ul><ul><ul><li>quality of work life (human resource strategy) </li></ul></ul><ul><ul><li>building and site constraints (location strategy) </li></ul></ul>
3. 3. What is Facility Layout <ul><li>Location or arrangement of everything within & around buildings </li></ul><ul><li>Objectives are to maximize </li></ul><ul><ul><li>Customer satisfaction </li></ul></ul><ul><ul><li>Utilization of space, equipment, & people </li></ul></ul><ul><ul><li>Efficient flow of information, material, & people </li></ul></ul><ul><ul><li>Employee morale & safety </li></ul></ul>
4. 4. Strategic Importance of Layout <ul><li>Proper layout enables : </li></ul><ul><li>Higher utilization of space, equipment,and people </li></ul><ul><li>Improved flow of information, materials, or people </li></ul><ul><li>Improved employee morale and safer working conditions </li></ul><ul><li>Improved customer/client interaction </li></ul><ul><li>Flexibility </li></ul>
5. 5. Requirements of a Good Layout <ul><ul><li>An understanding of capacity and space requirements </li></ul></ul><ul><ul><li>Selection of appropriate material handling equipment </li></ul></ul><ul><ul><li>Decisions regarding environment and aesthetics </li></ul></ul><ul><ul><li>Identification and understanding of the requirements for information flow </li></ul></ul><ul><ul><li>Identification of the cost of moving between the various work areas </li></ul></ul>
6. 6. Constraints on Layout Objectives <ul><li>Product design & volume </li></ul><ul><li>Process equipment & capacity </li></ul><ul><li>Quality of work life </li></ul><ul><li>Building and site </li></ul>
7. 7. Six Layout Strategies <ul><li>Fixed-position layout </li></ul><ul><ul><li>large bulky projects such as ships and buildings </li></ul></ul><ul><li>Process-oriented layout </li></ul><ul><ul><li>deals with low-volume, high-variety production (“job shop”, intermittent production) </li></ul></ul><ul><li>Office layout </li></ul><ul><ul><li>positions workers, their equipment, and spaces/offices to provide for movement of information </li></ul></ul>
8. 8. Six Layout Strategies - continued <ul><li>Retail/service layout </li></ul><ul><ul><li>allocates shelf space and responds to customer behavior </li></ul></ul><ul><li>Warehouse layout </li></ul><ul><ul><li>addresses trade-offs between space and material handling </li></ul></ul><ul><li>Product-oriented layout </li></ul><ul><ul><li>seeks the best personnel and machine use in repetitive or continuous production </li></ul></ul>
9. 9. Fixed-Position Layout <ul><li>Design is for stationary project </li></ul><ul><li>Workers and equipment come to site </li></ul><ul><li>Complicating factors </li></ul><ul><ul><li>Limited space at site </li></ul></ul><ul><ul><li>Changing material needs </li></ul></ul>
10. 10. Factors Complicating a Fixed Position Layout <ul><li>There is limited space at virtually all sites </li></ul><ul><li>At different stages in the construction process, different materials are needed – therefore, different items become critical as the project develops </li></ul><ul><li>The volume of materials needed is dynamic </li></ul>
11. 11. Process-Oriented Layout <ul><li>Design places departments with large flows of material or people together </li></ul><ul><li>Department areas having similar processes located in close proximity </li></ul><ul><ul><li>e.g., All x-ray machines in same area </li></ul></ul><ul><li>Used with process-focused processes </li></ul>
12. 12. Emergency Room Layout Surgery Radiology E.R. beds Pharmacy Billing/exit E.R.Triage room E.R. Admissions Patient B - erratic pacemaker Patient A - broken leg Hallway
13. 13. Steps in Developing a Process-Oriented Layout <ul><li>Construct a “from-to matrix” </li></ul><ul><li>Determine space requirements for each department </li></ul><ul><li>Develop an initial schematic diagram </li></ul><ul><li>Determine the cost of this layout </li></ul><ul><li>By trial-and-error (or more sophisticated means), try to improve the initial layout </li></ul><ul><li>Prepare a detailed plan that evaluates factors in addition to transportation cost </li></ul>
14. 14. Cost of Process-Oriented Layout
15. 15. Interdepartmental Flow of Parts 1 2 3 4 5 6 1 2 3 4 5 6 50 100 0 0 20 30 50 10 0 20 0 100 50 0 0
16. 16. Number of Weekly Loads 100 50 30 10 20 50 20 100 50 1 2 3 4 5 6
17. 17. Possible Layout 1 Assembly Department (1) Painting Department (2) Machine Shop Department (3) Receiving Department (4) Shipping Department (5) Testing Department (6) Room 1 Room 2 Room 3 Room 4 Room 5 Room 6 60’ 40’
18. 18. Number of Weekly Loads 100 50 30 10 20 50 20 100 50 1 2 3 4 5 6
19. 19. Possible Layout 2 Painting Department (2) Assembly Department (1) Machine Shop Department (3) Receiving Department (4) Shipping Department (5) Testing Department (6) Room 1 Room 2 Room 3 Room 4 Room 5 Room 6 60’ 40’
20. 20. Computer Programs for Layout <ul><li>CRAFT </li></ul><ul><li>SPACECRAFT </li></ul><ul><li>CRAFT 3-D </li></ul><ul><li>MULTIPLE </li></ul><ul><li>CORELAP </li></ul><ul><li>ALDEP </li></ul><ul><li>COFAD </li></ul><ul><li>FADES - expert system </li></ul>
21. 21. Out-Patient Hospital Example CRAFT 1 2 3 4 5 6 1 2 3 4 5 6 1 2 3 4 5 6 1 2 3 4 5 6 Total cost: 20,100 Est. Cost Reduction .00 Iteration 0 Total cost: 14,390 Est. Cost Reduction 70. Iteration 3 Legend: A = xray/MRI rooms B = laboratories C = admissions D = exam rooms E = operating rooms F = recovery rooms D E E E E E D D D B B B A A A A F F F F F D D D C C D D D D D B A A A A F F F A A A F F E B B B D D D D A A A A A E E D C C E E D D D B D D D D
22. 22. Cellular Layout - Work Cells <ul><li>Special case of product-oriented layout - in what is ordinarily a process-oriented facility </li></ul><ul><li>Consists of different machines brought together to make a product </li></ul><ul><li>Temporary arrangement only </li></ul><ul><li>Example: Assembly line set up to produce 3000 identical parts in a job shop </li></ul>
23. 23. Improving Layouts by Moving to the Work Cell Concept
24. 24. Work Cells - Some Advantages <ul><li>Reduced work-in-process inventory </li></ul><ul><li>Less floor space required </li></ul><ul><li>Reduced raw material and finished goods inventories required </li></ul><ul><li>Reduced direct labor costs </li></ul><ul><li>Heightened sense of employee participation </li></ul><ul><li>Increased utilization of equipment machinery </li></ul><ul><li>Reduced investment in machinery and equipment </li></ul>
25. 25. Work Cell Advantages Inventory Floor space Direct labor costs Equipment utilization Employee participation Quality
26. 26. Work Cell Floor Plan Office Tool Room Work Cell Saws Drills
27. 27. Requirements for Cellular Production <ul><li>Identification of families of products - group technology codes </li></ul><ul><li>High level of training and flexibility on the part of the employees </li></ul><ul><li>Either staff support or flexible, imaginative employees to establish the work cells initially </li></ul><ul><li>Test (poka-yoke) at each station in the cell </li></ul>
28. 28. Work Cells, etc. Work Cell A temporary assembly-line-oriented arrangement of machines and personnel in what is ordinarily a process-oriented facility Example: job shop with rearranged machinery and personnel to produce 30 unique control panels Focused Work Center A permanent assembly-line-oriented arrangement of machines and personnel in what is ordinarily a process-oriented facility Example: manufacturing of pipe brackets at a shipyard Focused Factory A permanent facility to produce a product or component in a product-oriented facility Example: a plant to produce window mechanisms for automobiles
29. 29. Number of Product Lines and Operating Performance -5 0 5 10 15 Sales (\$M) 100 <ul><li>D(6) </li></ul><ul><li>J(1) </li></ul><ul><li>I(2) </li></ul><ul><li>G(1) </li></ul><ul><li>H(2) </li></ul><ul><li>K(2) </li></ul>More focused plants <ul><li>E(4) </li></ul><ul><li>A(6) </li></ul><ul><li>F(6) </li></ul><ul><li>C(5) </li></ul><ul><li>B(5) </li></ul>Less focused plants
30. 30. Office Layout <ul><li>Design positions people, equipment, & offices for maximum information flow </li></ul><ul><li>Arranged by process or product </li></ul><ul><ul><li>Example: Payroll dept. is by process </li></ul></ul><ul><li>Relationship chart used </li></ul><ul><li>Examples </li></ul><ul><ul><li>Insurance company </li></ul></ul><ul><ul><li>Software company </li></ul></ul>
31. 31. Office Layout Floor Plan Accounting Manager Brand X Finance Fin. Acct.
32. 32. Retail/Service Layout <ul><li>Design maximizes product exposure to customers </li></ul><ul><li>Decision variables </li></ul><ul><ul><li>Store flow pattern </li></ul></ul><ul><ul><li>Allocation of (shelf) space to products </li></ul></ul><ul><li>Types </li></ul><ul><ul><li>Grid design </li></ul></ul><ul><ul><li>Free-flow design </li></ul></ul>
33. 33. Retail Layouts - Rules of Thumb <ul><li>Locate high-draw items around the periphery of the store </li></ul><ul><li>Use prominent locations such as the first or last aisle for high-impulse and high margin items </li></ul><ul><li>Remove crossover aisles that allow customers the opportunity to move between aisles </li></ul><ul><li>Distribute what are known in the trade as “power items” (items that may dominate a shopping trip) to both sides of an aisle, and disperse them to increase the viewing of other items </li></ul><ul><li>Use end aisle locations because they have a very high exposure rate </li></ul>
34. 34. Retail/Service Layout – Grid Design Office Carts Check- out Grocery Store Meat Bread Milk Produce Frozen Foods
35. 35. Retail/Service Layout - Free-Flow Design Feature Display Table Trans. Counter Apparel Store
36. 36. Retail Store Shelf Space Planogram <ul><li>Computerized tool for shelf-space management </li></ul><ul><li>Generated from store’s scanner data on sales </li></ul><ul><li>Often supplied by manufacturer </li></ul><ul><ul><li>Example: P&G </li></ul></ul>2 ft . 5 facings VO-5 VO-5 VO-5 SUAVE SUAVE VO-5 PERT PERT PERT PERT PERT VO-5
37. 37. A Good Service Layout (Servicescape) Considers <ul><li>Ambient conditions - background characteristics such as lighting, sound, smell, and temperature. </li></ul><ul><li>Spatial layout and functionality - which involve customer circulation path planning </li></ul><ul><li>Signs, Symbols, and Artifacts - characteristics of building design that carry social significance </li></ul>
38. 38. Warehouse Layout <ul><li>Design balances space (cube) utilization & handling cost </li></ul><ul><li>Similar to process layout </li></ul><ul><ul><li>Items moved between dock & various storage areas </li></ul></ul><ul><li>Optimum layout depends on </li></ul><ul><ul><ul><li>Variety of items stored </li></ul></ul></ul><ul><ul><ul><li>Number of items picked </li></ul></ul></ul>
39. 39. Warehouse Layout Floor Plan Zones Conveyor Truck Order Picker
40. 40. Cross Docking <ul><li>Transferring goods </li></ul><ul><ul><li>from incoming trucks at receiving docks </li></ul></ul><ul><ul><li>to outgoing trucks at shipping docks </li></ul></ul><ul><li>Avoids placing goods into storage </li></ul><ul><li>Requires suppliers provide effective addressing (bar codes) and packaging that provides for rapid transhipment </li></ul>In-coming Outgoing © 1984-1994 T/Maker Co. © 1995 Corel Corp.
41. 41. Random Stocking Systems Often: <ul><li>Maintain a list of “open” locations </li></ul><ul><li>Maintain accurate records of existing inventory and its locations </li></ul><ul><li>Sequence items on orders to minimize travel time required to pick orders </li></ul><ul><li>Combine orders to reduce picking time </li></ul><ul><li>Assign certain items or classes of items, such as high usage items, to particular warehouse areas so that distance traveled is minimized </li></ul>
42. 42. Product-Oriented Layout <ul><li>Facility organized around product </li></ul><ul><li>Design minimizes line imbalance </li></ul><ul><ul><li>Delay between work stations </li></ul></ul><ul><li>Types: Fabrication line; assembly line </li></ul>
43. 43. Product-Oriented Requirements <ul><li>Standardized product </li></ul><ul><li>High production volume </li></ul><ul><li>Stable production quantities </li></ul><ul><li>Uniform quality of raw materials & components </li></ul>
44. 44. Product-Oriented Layout - Assumptions <ul><li>Volume is adequate for high equipment utilization </li></ul><ul><li>Product demand is stable enough to justify high investment in specialized equipment </li></ul><ul><li>Product is standardized or approaching a phase of its life cycle that justifies investment in specialized equipment </li></ul><ul><li>Supplies of raw materials and components are adequate and of uniform quality to ensure they will work with specialized equipment </li></ul>
45. 45. Product-Oriented Layout Types <ul><li>Assembles fabricated parts </li></ul><ul><li>Uses workstations </li></ul><ul><li>Repetitive process </li></ul><ul><li>Paced by tasks </li></ul><ul><li>Balanced by moving tasks </li></ul><ul><li>Builds components </li></ul><ul><li>Uses series of machines </li></ul><ul><li>Repetitive process </li></ul><ul><li>Machine paced </li></ul><ul><li>Balanced by physical redesign </li></ul>Fabrication Line Assembly Line
46. 46. Product Layout Advantages <ul><li>Lower variable cost per unit </li></ul><ul><li>Lower material handling costs </li></ul><ul><li>Lower work-in-process inventories </li></ul><ul><li>Easier training & supervision </li></ul><ul><li>Rapid throughput </li></ul>
47. 47. Product Layout Disadvantages <ul><li>Higher capital investment </li></ul><ul><ul><li>Special equipment </li></ul></ul><ul><li>Any work stoppage stops whole process </li></ul><ul><li>Lack of flexibility </li></ul><ul><ul><li>Volume </li></ul></ul><ul><ul><li>Product </li></ul></ul>
48. 48. An Assembly Line Layout
49. 49. Assembly Line Types
50. 50. Repetitive Layout 1 3 2 4 5 Work Office Belt Conveyor Work Station Note: 5 tasks or operations; 3 work stations Work Station Station
51. 51. Assembly Line Balancing <ul><li>Analysis of production lines </li></ul><ul><li>Nearly equally divides work between workstations while meeting required output </li></ul><ul><li>Objectives </li></ul><ul><ul><li>Maximize efficiency </li></ul></ul><ul><ul><li>Minimize number of work stations </li></ul></ul>
52. 52. Assembly Line Balancing The General Procedure <ul><li>Determine cycle time by taking the demand (or production rate) per day and dividing it into the productive time available per day </li></ul><ul><li>Calculate the theoretical minimum number of work stations by dividing total task time by cycle time </li></ul><ul><li>Perform the line balance and assign specific assembly tasks to each work station </li></ul>
53. 53. Assembly Line Balancing Steps <ul><li>1. Determine tasks (operations) </li></ul><ul><li>2. Determine sequence </li></ul><ul><li>3. Draw precedence diagram </li></ul><ul><li>4. Estimate task times </li></ul><ul><li>5. Calculate cycle time </li></ul><ul><li>6. Calculate number of work stations </li></ul><ul><li>7. Assign tasks </li></ul><ul><li>8. Calculate efficiency </li></ul>
54. 54. Assembly Line Balancing Jargon <ul><li>Task – an element of work on the product line </li></ul><ul><li>Workstation – a physical location where a particular set of tasks is performed </li></ul><ul><li>Product Line – much like a moving conveyor that passes a series of workstations in a uniform time interval: </li></ul><ul><li>Cycle Time – the time between successive units coming off the end of the line </li></ul>
55. 55. Assembly Line Balancing Equations Cycle time = Production time available Demand per day Minimum number of work stations  Task times Cycle time Efficiency = =  Task times * (Cycle time) (Actual number of work stations)