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F O U R T H E D I T I O N

Facility Decisions:Layouts

© The McGraw-Hill Companies, Inc., 2003

chapter 8

Fundamentals of Operations Management 4e © The McGraw-Hill Companies, Inc., 2003 8–2

Chapter ObjectivesChapter ObjectivesChapter ObjectivesChapter Objectives

• Introduce the different types of facility layouts that can be used in designing manufacturing and service operations.

• Present a methodology for designing a process-oriented layout.

• Introduce the concept of takt time and its relationship to the output capacity of a product-oriented layout.

• Identify the various steps and elements that are involved in balancing an assembly line.

• Discuss the current trends in facility layouts given today’s shorter product life cycles and the customer’s increasing desire for customized products.

Fundamentals of Operations Management 4e © The McGraw-Hill Companies, Inc., 2003 8–3

Managerial IssuesManagerial IssuesManagerial IssuesManagerial Issues

• Recognizing that many factors must be considered in choosing how to layout a facility.

• Understanding the significant impact that choosing a particular type of layout has on the firm’s ability to compete in the market and its long-term success.

• Developing estimates of the investment costs of time and money associated with installing a particular layout.

• Attaining the goal of a smooth flow of material through the process through the choice of a layout that is both efficient and effective.

Fundamentals of Operations Management 4e © The McGraw-Hill Companies, Inc., 2003 8–4

Types of Manufacturing LayoutsTypes of Manufacturing LayoutsTypes of Manufacturing LayoutsTypes of Manufacturing Layouts

Layout Type

Process Similar operations are performed in a common or functional area, regardless of the product in which the parts are used.

Product (Flow-shop layout)

Equipment/operations are located according to the progressive steps required to make the product.

Group Technology (GT) or Cellular

Groups of dissimilar machines are brought together in a work cell to perform tasks on a family of products that share common interests.

Fixed-Position The product, because of its size and/or weight, remains in one location and processes are brought to it.

Fundamentals of Operations Management 4e © The McGraw-Hill Companies, Inc., 2003 8–5

Characteristics of a Good LayoutCharacteristics of a Good LayoutCharacteristics of a Good LayoutCharacteristics of a Good Layout

Exhibit 8.1Exhibit 8.1

Fundamentals of Operations Management 4e © The McGraw-Hill Companies, Inc., 2003 8–6

Interdepartmental FlowInterdepartmental FlowInterdepartmental FlowInterdepartmental Flow

Exhibit 8.2Exhibit 8.2

Fundamentals of Operations Management 4e © The McGraw-Hill Companies, Inc., 2003 8–7

Building Dimensions and DepartmentsBuilding Dimensions and DepartmentsBuilding Dimensions and DepartmentsBuilding Dimensions and Departments

Exhibit 8.3Exhibit 8.3

Fundamentals of Operations Management 4e © The McGraw-Hill Companies, Inc., 2003 8–8

Interdepartmental Flow Graph withInterdepartmental Flow Graph withNumber of Annual MovementsNumber of Annual Movements

Interdepartmental Flow Graph withInterdepartmental Flow Graph withNumber of Annual MovementsNumber of Annual Movements

Exhibit 8.4Exhibit 8.4

Fundamentals of Operations Management 4e © The McGraw-Hill Companies, Inc., 2003 8–9

Cost MatrixCost Matrix—First Solution—First SolutionCost MatrixCost Matrix—First Solution—First Solution

Exhibit 8.5Exhibit 8.5

Fundamentals of Operations Management 4e © The McGraw-Hill Companies, Inc., 2003 8–10

Revised Interdepartmental Flowchart*Revised Interdepartmental Flowchart*Revised Interdepartmental Flowchart*Revised Interdepartmental Flowchart*

Exhibit 8.6Exhibit 8.6

*Only interdepartmental flow with effect on cost is depicted.

Fundamentals of Operations Management 4e © The McGraw-Hill Companies, Inc., 2003 8–11

Cost MatrixCost Matrix—Second Solution—Second SolutionCost MatrixCost Matrix—Second Solution—Second Solution

Exhibit 8.7Exhibit 8.7

Fundamentals of Operations Management 4e © The McGraw-Hill Companies, Inc., 2003 8–12

Revised Building LayoutRevised Building LayoutRevised Building LayoutRevised Building Layout

Exhibit 8.8Exhibit 8.8

Fundamentals of Operations Management 4e © The McGraw-Hill Companies, Inc., 2003 8–13

Product LayoutProduct LayoutProduct LayoutProduct Layout

• Assembly Lines–A progressive paced assembly linked by some

sort of material handling device.

• Assembly Line Type Differences–Material handling devices–Line configuration–Pacing (machine or human)–Product mix–Workstation characteristic–Length of line

Fundamentals of Operations Management 4e © The McGraw-Hill Companies, Inc., 2003 8–14

Product Layout: Key TermsProduct Layout: Key TermsProduct Layout: Key TermsProduct Layout: Key Terms

• Product Interval Time–The time between products being completed

(processed through) at a single station (process step). Also cycle time or takt time.

• Product Duration (Throughput) Time.–The overall time required to entirely complete an

individual product.

• Assembly Line Balancing–Assignment of tasks to workstations within a

given cycle time and with minimum idle worker time.

Fundamentals of Operations Management 4e © The McGraw-Hill Companies, Inc., 2003 8–15

Assembly Line Balancing StepsAssembly Line Balancing StepsAssembly Line Balancing StepsAssembly Line Balancing Steps

1. Specify the sequential relationships among tasks using a precedence diagram.

2. Determine the required takt (T) time.

3. Determine the theoretical minimum number of workstations (Nt) required to satisfy the takt time constraint.

4. Select a primary rule by which tasks are to be assigned to workstations and a secondary rule to break ties.

Fundamentals of Operations Management 4e © The McGraw-Hill Companies, Inc., 2003 8–16

Assembly Line Balancing Steps Assembly Line Balancing Steps (cont’d)(cont’d)

Assembly Line Balancing Steps Assembly Line Balancing Steps (cont’d)(cont’d)

5. Assign tasks, one at a time, to the first workstation until the sum of the task times is equal to the takt time. Continue assigning tasks to other workstations until all tasks are assigned.

6. Evaluate the efficiency of the resulting assembly line.

7. If efficiency is unsatisfactory, rebalance the line using a different decision rule in step 4.

Fundamentals of Operations Management 4e © The McGraw-Hill Companies, Inc., 2003 8–17

Takt Time and Throughput Time Takt Time and Throughput Time on an Assembly Lineon an Assembly Line

Takt Time and Throughput Time Takt Time and Throughput Time on an Assembly Lineon an Assembly Line

Matching task time to takt time:1. Split the task2. Duplicate the station3. Share the task4. Use a more skilled worker5. Work overtime6. Redesign the product

Exhibit 8.9Exhibit 8.9

Fundamentals of Operations Management 4e © The McGraw-Hill Companies, Inc., 2003 8–18

Assembly Line Balancing FormulasAssembly Line Balancing FormulasAssembly Line Balancing FormulasAssembly Line Balancing Formulas

units)(in day per Output

dayper timeProduction Takt time (T)

Takt time (T)

Sum of task times (S) Number of workstations

Takt time (T)workstations (Na)ofnumber Actual

Sum of task times (S)Efficiency

Fundamentals of Operations Management 4e © The McGraw-Hill Companies, Inc., 2003 8–19

Assembly Steps and Times for Model J Assembly Steps and Times for Model J WagonWagon

Assembly Steps and Times for Model J Assembly Steps and Times for Model J WagonWagon

Exhibit 8.10Exhibit 8.10

Fundamentals of Operations Management 4e © The McGraw-Hill Companies, Inc., 2003 8–20

Precedence Graph for Model J WagonPrecedence Graph for Model J WagonPrecedence Graph for Model J WagonPrecedence Graph for Model J Wagon

Exhibit 8.11Exhibit 8.11

Fundamentals of Operations Management 4e © The McGraw-Hill Companies, Inc., 2003 8–21

A Balance Made According to A Balance Made According to Largest Number of Following Tasks RuleLargest Number of Following Tasks Rule

A Balance Made According to A Balance Made According to Largest Number of Following Tasks RuleLargest Number of Following Tasks Rule

Exhibit 8.12aExhibit 8.12a

Fundamentals of Operations Management 4e © The McGraw-Hill Companies, Inc., 2003 8–22

Precedence Graph for Model J WagonPrecedence Graph for Model J WagonPrecedence Graph for Model J WagonPrecedence Graph for Model J Wagon

Exhibit 8.12BExhibit 8.12B

Fundamentals of Operations Management 4e © The McGraw-Hill Companies, Inc., 2003 8–23

Efficiency CalculationEfficiency CalculationEfficiency CalculationEfficiency Calculation

Exhibit 8.12CExhibit 8.12C

%77,77.04.505

195orEfficiency

NT

SEfficiency

Fundamentals of Operations Management 4e © The McGraw-Hill Companies, Inc., 2003 8–24

Flexible Flexible Line Line

LayoutsLayouts

Flexible Flexible Line Line

LayoutsLayouts

Exhibit 8.13Exhibit 8.13Source: Robert W. Hall, Attaining Manufacturing Excellence (Homewood, IL: Dow Jones-Irwin, 1987), p. 125.

Fundamentals of Operations Management 4e © The McGraw-Hill Companies, Inc., 2003 8–25

Group Technology (Cellular) LayoutGroup Technology (Cellular) LayoutGroup Technology (Cellular) LayoutGroup Technology (Cellular) Layout

• Benefits–Better human relations in small work teams.–Improved operator expertise from the limited

number of parts and quick production cycle.–Less work-in-process inventory and material

handling due to reduced number of production stages.

–Faster production setup from faster tooling changes.

Fundamentals of Operations Management 4e © The McGraw-Hill Companies, Inc., 2003 8–26

Group Technology (GT) LayoutGroup Technology (GT) LayoutGroup Technology (GT) LayoutGroup Technology (GT) Layout

• Developing a GT Layout–Grouping parts into families that follow a

common sequence of steps.–Identifying dominant flow patterns of parts-

families for location of processes.–Physically grouping machines and processes

into cells.

Fundamentals of Operations Management 4e © The McGraw-Hill Companies, Inc., 2003 8–27

Facilities Layout for ServicesFacilities Layout for ServicesFacilities Layout for ServicesFacilities Layout for Services

• Goals of Service Facility Layouts–Minimize travel time for workers and customers–Maximize revenues from customers

• Types of Service Layouts–Process layout—emergency rooms–Product layout—cafeteria line–Fixed-position layout—automobile repair shop

Fundamentals of Operations Management 4e © The McGraw-Hill Companies, Inc., 2003 8–28

Facilities Layout for ServicesFacilities Layout for ServicesFacilities Layout for ServicesFacilities Layout for Services

• Servicescape–The aspects of the physical surroundings in a

service operation that can affect a customer’s perception of the service received.

–Ambient conditions• Noise, lighting, and temperature

–Spatial layout and functionality• Minimizing employee travel time and maximizing

revenue opportunities from customers

–Signs, symbols, and artifacts• Objects that create positive images of the firm