L ayout

© 2006 Prentice Hall, Inc. 9 – 1

Operations ManagementOperations ManagementChapter 9 – Layout StrategyChapter 9 – Layout Strategy

© 2006 Prentice Hall, Inc.


Innovations at McDonald’sInnovations at McDonald’s

Indoor seating (1950s)Indoor seating (1950s) Drive-through windowDrive-through window (1970s) (1970s) Adding breakfast to the menu Adding breakfast to the menu

(1980s)(1980s) Adding play areas (1990s)Adding play areas (1990s)

Three out of the four are Three out of the four are layout decisions!layout decisions!


Strategic Importance of Strategic Importance of Layout DecisionsLayout Decisions

The objective of The objective of layout strategy layout strategy is to develop an economic layoutis to develop an economic layout

that will meet the firm’s that will meet the firm’s competitive requirementscompetitive requirements


Layout Design Layout Design ConsiderationsConsiderations

Higher Higher utilization of spaceutilization of space, equipment, , equipment, and peopleand people

Improved Improved flow of informationflow of information, materials, , materials, or peopleor people

Improved Improved employee moraleemployee morale and safer and safer working conditionsworking conditions

Improved Improved customer/client interactioncustomer/client interaction

FlexibilityFlexibility


Types of LayoutTypes of Layout

1.1. Office layout Office layout

2.2. Retail layout Retail layout

3.3. Warehouse layoutWarehouse layout

4.4. Fixed-position layoutFixed-position layout

5.5. Process-oriented layoutProcess-oriented layout

6.6. Work cell layout Work cell layout

7.7. Product-oriented layoutProduct-oriented layout



1.1. Office layout - positions workers, Office layout - positions workers, their equipment, and spaces/offices their equipment, and spaces/offices to provide for movement of to provide for movement of informationinformation

2.2. Retail layout - allocates Retail layout - allocates shelf spaceshelf space and responds to customer behavior and responds to customer behavior

3.3. Warehouse layout - addresses Warehouse layout - addresses trade-offs between space and trade-offs between space and material handlingmaterial handling



4.4. Fixed-position layout - addresses Fixed-position layout - addresses the layout requirements of large, the layout requirements of large, bulky bulky projects such as ships and projects such as ships and buildingsbuildings

5.5. Process-oriented layout - deals with Process-oriented layout - deals with low-volume, high-varietylow-volume, high-variety production production (also called job shop or intermittent (also called job shop or intermittent production)production)



6.6. Work cell layout - a Work cell layout - a special special arrangement of machineryarrangement of machinery and and equipment to focus on production of equipment to focus on production of a single product or group of related a single product or group of related productsproducts

7.7. Product-oriented layout - seeks the Product-oriented layout - seeks the best best personnel and machinepersonnel and machine utilizations in repetitive or utilizations in repetitive or continuous productioncontinuous production


Good Layouts ConsiderGood Layouts Consider

1.1. Material handling equipmentMaterial handling equipment

2.2. Capacity and space requirementsCapacity and space requirements

3.3. Environment and aestheticsEnvironment and aesthetics

4.4. Flows of informationFlows of information

5.5. Cost of moving between various Cost of moving between various work areaswork areas


Office LayoutOffice Layout

Grouping of workers, their Grouping of workers, their equipment, and spaces to provide equipment, and spaces to provide comfort, safety, and movement of comfort, safety, and movement of informationinformation

Movement of information is main Movement of information is main distinctiondistinction

Typically in state of flux due to Typically in state of flux due to frequent technological changesfrequent technological changes


Relationship ChartRelationship ChartValue Closeness

A Absolutely necessary

E Especially important

I Important

O Ordinary OK

U Unimportant

X Not desirable

President

Chief Technology Officer

Engineer’s area

Secretary

Office entrance

Central files

Equipment cabinet

Photocopy equipment

Storage room

O

UA

X

O

U

A

I

OA

I

O

U

AI

I

A

UO

AU O

UX

O I

U

OII

I

E

EE

E E

1122

3344

5566

77

8899

Figure 9.1Figure 9.1


Supermarket Supermarket Retail LayoutRetail Layout

Objective is to Objective is to maximize maximize profitability per square foot of profitability per square foot of floor spacefloor space

Sales and profitability vary Sales and profitability vary directly with directly with customer exposurecustomer exposure

Things at the counter have the Things at the counter have the most exposure.most exposure.


Store LayoutStore Layout



Retail SlottingRetail Slotting Manufacturers pay fees to retailers Manufacturers pay fees to retailers

to get the retailers to display (slot) to get the retailers to display (slot) their producttheir product

Contributing factorsContributing factors Limited shelf spaceLimited shelf space

An increasing number of new An increasing number of new productsproducts

Better information about sales Better information about sales through POS data collectionthrough POS data collection

Closer control of inventoryCloser control of inventory


Warehousing and Storage Warehousing and Storage LayoutsLayouts

Objective is to optimize trade-offs Objective is to optimize trade-offs between handling costs and costs between handling costs and costs associated with warehouse spaceassociated with warehouse space

Maximize the total “cube” of the Maximize the total “cube” of the warehouse – warehouse – utilize its full volumeutilize its full volume while maintaining low material while maintaining low material handling costshandling costs

More location than layout decision.More location than layout decision.


Cross-DockingCross-Docking

Materials are moved directly from Materials are moved directly from receiving to shipping and are not receiving to shipping and are not placed in storage in the placed in storage in the warehousewarehouse

Requires tight scheduling and Requires tight scheduling and accurate shipments, typically accurate shipments, typically with bar code identificationwith bar code identification


Fixed-Position LayoutFixed-Position Layout

Product remains in one place Product remains in one place

Workers and equipment come to Workers and equipment come to sitesite

Complicating factorsComplicating factors Limited space at siteLimited space at site

Different materials required at Different materials required at different stages of the projectdifferent stages of the project

Volume of materials needed is Volume of materials needed is dynamicdynamic


Alternative StrategyAlternative Strategy

As much of the project as possible As much of the project as possible is completed off-site in a product-is completed off-site in a product-

oriented facilityoriented facility

This can significantly improve This can significantly improve efficiency but is only possible when efficiency but is only possible when

multiple similar units need to be multiple similar units need to be createdcreated


Process-Oriented LayoutProcess-Oriented Layout

Like machines and equipment are Like machines and equipment are grouped togethergrouped together

Scheduling can be difficult and Scheduling can be difficult and setup, material handling, and labor setup, material handling, and labor costs can be highcosts can be high


Surgery

Radiology

ER triage room

ER Beds Pharmacy

Emergency room admissions

Billing/exit

Laboratories


Patient A - broken leg

Patient B - erratic heart pacemaker




Arrange work centers so as to Arrange work centers so as to minimize the costs of material minimize the costs of material handlinghandling

Basic cost elements areBasic cost elements are Number of loads (or people) moving Number of loads (or people) moving

between centersbetween centers

Distance loads (or people) move Distance loads (or people) move between centersbetween centers


Layout at Arnold Palmer Layout at Arnold Palmer HospitalHospital



Minimize cost = Minimize cost = ∑ ∑∑ ∑ X Xijij C Cijij

nn

i i = 1= 1

nn

j j = 1= 1

wherewhere nn == total number of total number of work centers or departmentswork centers or departments

i, ji, j == individual individual departmentsdepartments

XXijij == number of loads number of loads moved from department i to moved from department i to department jdepartment j

CCijij == cost to move a load cost to move a load between department i and between department i and department jdepartment j


Process Layout ExampleProcess Layout Example

1.1. Construct a “from-to matrix”Construct a “from-to matrix”

2.2. Determine the space requirementsDetermine the space requirements

3.3. Develop an initial schematic diagramDevelop an initial schematic diagram

4.4. Determine the cost of this layout Determine the cost of this layout

5.5. Try to improve the layoutTry to improve the layout

6.6. Prepare a detailed plan Prepare a detailed plan

Arrange six departments in a factory to Arrange six departments in a factory to minimize the material handling costs. minimize the material handling costs. Each department is 20 x 20 feet and the Each department is 20 x 20 feet and the building is 60 feet long and 40 feet wide.building is 60 feet long and 40 feet wide.


DepartmentDepartment AssemblyAssembly PaintingPainting MachineMachine ReceivingReceiving ShippingShipping TestingTesting(1)(1) (2)(2) Shop (3)Shop (3) (4)(4) (5)(5) (6)(6)

Assembly (1)Assembly (1)

Painting (2)Painting (2)

Machine Shop (3)Machine Shop (3)

Receiving (4)Receiving (4)

Shipping (5)Shipping (5)

Testing (6)Testing (6)

Number of loads per weekNumber of loads per week

50 100 0 0 20

30 50 10 0

20 0 100

50 0

0




Room 1Room 1 Room 2Room 2 Room 3Room 3

Room 4Room 4 Room 5Room 5 Room 6Room 660’60’

40’40’


Receiving Shipping TestingDepartment Department Department

(4) (5) (6)


Assembly Painting Machine ShopDepartment Department Department

(1) (2) (3)



Cost Cost == $50$50 ++ $200$200 ++ $40$40(1 and 2)(1 and 2) (1 and 3)(1 and 3) (1 and 6)(1 and 6)

++ $30$30 ++ $50$50 ++ $10$10(2 and 3)(2 and 3) (2 and 4)(2 and 4) (2 and 5)(2 and 5)


= $570= $570

Cost = Cost = ∑ ∑∑ ∑ X Xijij C Cijij

nn

i i = 1= 1

nn

j j = 1= 1


100100

5050

2020

5050

5050

20201010

100100

3030


Interdepartmental Flow GraphInterdepartmental Flow Graph

1 2 3

4 5 6




Cost Cost == $50$50 ++ $100$100 ++ $20$20(1 and 2)(1 and 2) (1 and 3)(1 and 3) (1 and 6)(1 and 6)



= $480= $480

Cost = Cost = ∑ ∑∑ ∑ X Xijij C Cijij

nn

i i = 1= 1

nn

j j = 1= 1



3030

5050

1010

5050

50502020

5050 100100

100100

Interdepartmental Flow GraphInterdepartmental Flow Graph

2 1 3

4 5 6



Room 1Room 1 Room 2Room 2 Room 3Room 3

Room 4Room 4 Room 5Room 5 Room 6Room 660’60’

40’40’


Receiving Shipping TestingDepartment Department Department

(4) (5) (6)


Painting Assembly Machine ShopDepartment Department Department

(2) (1) (3)


Computer SoftwareComputer Software

Graphical approach only works for Graphical approach only works for small problemssmall problems

Computer programs are available to Computer programs are available to solve bigger problemssolve bigger problems CRAFTCRAFT

ALDEPALDEP

CORELAPCORELAP

Factory FlowFactory Flow


Work CellsWork Cells

Reorganizes people and machines Reorganizes people and machines into groups to focus on single into groups to focus on single products or product groupsproducts or product groups

Group technology identifies Group technology identifies products that have similar products that have similar characteristics for particular cellscharacteristics for particular cells

Volume must justify cellsVolume must justify cells

Cells can be reconfigured as Cells can be reconfigured as designs or volume changesdesigns or volume changes


Improving Layouts Using Improving Layouts Using Work CellsWork Cells

Current layout - straight Current layout - straight lines make it hard to balance lines make it hard to balance tasks because work may not tasks because work may not be divided evenlybe divided evenly

Improved layout - in U Improved layout - in U shape, workers have better shape, workers have better access. Four cross-trained access. Four cross-trained workers were reduced.workers were reduced.

Figure 9.10 (b)Figure 9.10 (b)

U-shaped line may reduce employee movement and space requirements while enhancing communication, reducing the number of workers, and facilitating inspection


Requirements of Work CellsRequirements of Work Cells

1.1. Identification of families of productsIdentification of families of products

2.2. A high level of training and A high level of training and flexibility on the part of employeesflexibility on the part of employees

3.3. Either staff support or flexible, Either staff support or flexible, imaginative employees to establish imaginative employees to establish work cells initiallywork cells initially

4.4. Test (poka-yoke) at each station in Test (poka-yoke) at each station in the cellthe cell


Staffing and Balancing Staffing and Balancing Work CellsWork Cells

Determine the takt timeDetermine the takt time

Takt time =Takt time =total work time availabletotal work time available

units requiredunits required

Determine the number Determine the number of operators requiredof operators required

Workers required =Workers required =total operation time requiredtotal operation time required

takt timetakt time


Staffing Work Cells ExampleStaffing Work Cells Example

600 600 Mirrors per day requiredMirrors per day requiredMirror production scheduled for Mirror production scheduled for 88 hours per day hours per dayFrom a work balance chart From a work balance chart

total operation time total operation time = 140= 140 seconds seconds

Sta

nd

ard

tim

e re

qu

ired

Sta

nd

ard

tim

e re

qu

ired

OperationsOperations

AssembleAssemble PaintPaint TestTest LabelLabel Pack forPack forshipmentshipment

6060

5050

4040

3030

2020

1010

00


600600 Mirrors per day required Mirrors per day requiredMirror production scheduled for Mirror production scheduled for 88 hours per day hours per dayFrom a work balance chart From a work balance chart

total operation time = total operation time = 140 140 secondsseconds

Staffing Work Cells ExampleStaffing Work Cells Example

Takt timeTakt time = = (8(8 hrs hrs x 60x 60 mins mins) / 600) / 600 units units = .8= .8 mins mins = 48= 48 seconds seconds

Workers requiredWorkers required ==total operation time requiredtotal operation time required

takt timetakt time

= 140 / 48 = 2.91= 140 / 48 = 2.91


Work Balance ChartsWork Balance Charts

Used for evaluating operation Used for evaluating operation times in work cellstimes in work cells

Can help identify bottleneck Can help identify bottleneck operationsoperations

Flexible, cross-trained employees Flexible, cross-trained employees can help address labor bottleneckscan help address labor bottlenecks

Machine bottlenecks may require Machine bottlenecks may require other approachesother approaches


Focused Work Center and Focused Work Center and Focused FactoryFocused Factory

Focused Work CenterFocused Work Center Identify a large family of similar products Identify a large family of similar products

that have a large and stable demandthat have a large and stable demand

Moves production from a general-purpose, Moves production from a general-purpose, process-oriented facility to a large work cellprocess-oriented facility to a large work cell

Focused FactoryFocused Factory A focused work cell in a separate facilityA focused work cell in a separate facility

May be focused by product line, layout, May be focused by product line, layout, quality, new product introduction, flexibility, quality, new product introduction, flexibility, or other requirementsor other requirements


Focused Work Center and Focused Work Center and Focused FactoryFocused Factory

Table 9.2Table 9.2

Work CellWork Cell Focused Work CenterFocused Work Center Focused FactoryFocused Factory

A work cell is a A work cell is a temporary product-temporary product-oriented arrangement oriented arrangement of machines and of machines and personnel in what is personnel in what is ordinarily a process-ordinarily a process-oriented facility.oriented facility.

A focused work center is A focused work center is a permanent product-a permanent product-oriented arrangement oriented arrangement of machines and of machines and personnel in what is personnel in what is ordinarily a process-ordinarily a process-oriented facility.oriented facility.

A focused factory is a A focused factory is a permanent facility to permanent facility to produce a product or produce a product or component in a component in a product-oriented product-oriented facility. Many focused facility. Many focused factories currently factories currently being built were being built were originally part of a originally part of a process-oriented process-oriented facility.facility.

Example: A job shop Example: A job shop with machinery and with machinery and personnel; rearranged personnel; rearranged to produce 300 unique to produce 300 unique control panels.control panels.

Example: Pipe bracket Example: Pipe bracket manufacturing at a manufacturing at a shipyard.shipyard.

Example: A plant to Example: A plant to produce window produce window mechanism for mechanism for automobiles.automobiles.


Repetitive and Product-Repetitive and Product-Oriented LayoutOriented Layout

Volume is adequate for high equipment Volume is adequate for high equipment utilizationutilization

Product demand is stable enough to justify high Product demand is stable enough to justify high investment in specialized equipmentinvestment in specialized equipment

Product is standardized or approaching a phase Product is standardized or approaching a phase of life cycle that justifies investment of life cycle that justifies investment

Supplies of raw materials and components are Supplies of raw materials and components are adequate and of uniform qualityadequate and of uniform quality

Organized around products or families of Organized around products or families of similar high-volume, low-variety productssimilar high-volume, low-variety products


Product-Oriented LayoutsProduct-Oriented Layouts Fabrication lineFabrication line

Builds components on a series of machinesBuilds components on a series of machines Machine-pacedMachine-paced Require mechanical or engineering changes Require mechanical or engineering changes

to balanceto balance Assembly lineAssembly line

Puts fabricated parts together at a series of Puts fabricated parts together at a series of workstationsworkstations

Paced by work tasksPaced by work tasks Balanced by moving tasksBalanced by moving tasks

Both types of lines must be balanced so that the Both types of lines must be balanced so that the time to perform the work at each station is the sametime to perform the work at each station is the same


Product-Oriented LayoutsProduct-Oriented Layouts

1.1. Low variable cost per unitLow variable cost per unit

2.2. Low material handling costsLow material handling costs

3.3. Reduced work-in-process inventoriesReduced work-in-process inventories

4.4. Easier training and supervisionEasier training and supervision

5.5. Rapid throughputRapid throughput

AdvantagesAdvantages

1.1. High volume is requiredHigh volume is required

2.2. Work stoppage at any point ties up the Work stoppage at any point ties up the whole operationwhole operation

3.3. Lack of flexibility in product or production Lack of flexibility in product or production ratesrates

DisadvantagesDisadvantages


Assembly-Line BalancingAssembly-Line Balancing

Objective is to minimize the imbalance Objective is to minimize the imbalance between machines or personnel while between machines or personnel while meeting required outputmeeting required output

Starts with the precedence Starts with the precedence relationshipsrelationships

1.1. Determine cycle timeDetermine cycle time

2.2. Calculate theoretical minimum number Calculate theoretical minimum number of workstationsof workstations

3.3. Balance the line by assigning specific Balance the line by assigning specific tasks to workstationstasks to workstations


Copier ExampleCopier Example

This means that This means that tasks B and E tasks B and E cannot be done cannot be done until task A has until task A has been completedbeen completed

PerformancePerformance Task Must FollowTask Must FollowTimeTime Task ListedTask Listed

TaskTask (minutes)(minutes) BelowBelow

AA 1010 ——BB 1111 AACC 55 BBDD 44 BBEE 1212 AAFF 33 C, DC, DGG 77 FFHH 1111 EEII 33 G, HG, H

Total time Total time 6666






Total time Total time 6666 I

GF

C

D

H

B

E

A

10

1112

5

4 3

711 3

Figure 9.13


I

GF

C

D

H

B

E

A

10

1112

5

4 3

711 3

Figure 9.13





Copier ExampleCopier Example480 available

mins per day40 units 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


I

GF

C

D

H

B

E

A

10

1112

5

4 3

711 3

Figure 9.13







Cycle time = 12 mins

Minimum workstations = 5.5 or 6

Line-Balancing Heuristics

1. Longest task time Choose the available task with the longest task time

2. Most following tasks Choose 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 time Choose 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


480 available mins per day

40 units required








I

GF

H

C

D

B

E

A

10 11

12

5

4

3 7

11

3

Station 1

Station 2

Station 3

Station 5

Station 4

Station 6

Figure 9.14










Efficiency =∑ Task times

(actual number of workstations) x (largest cycle time)

= 66 minutes / (6 stations) x (12 minutes)

= 91.7%

L ayout

Documents

Transcript of L ayout