Facility Layout

Section Objectives
After completing this section, you should be able to:

1. List some of the different reasons for redesign of layouts.

2. Identify the inputs to facility layout decisions. 3. Distinguish between the four basic types of facility layouts. 4. List the primary advantages and limitations of both product and process layout. 5. Develop appropriate process layouts. 6. Solve line balancing problems. 7. Describe new layout approaches.

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Facility Layout
The optimum placement or arrangement of space-consuming components within a productive system. The space-consuming components are: machines materials manpower The benefits of a good layout include: smooth material flow reduced inventories better scheduling effective space utilization fewer production bottlenecks reduced material handling costs

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Inputs to Facility Layout

1. Output (product / service) design - product or service design affects the layout of a facility. Design issues that have to be considered include: Dimensions / weights of components Perishability / obsolescence Customer interaction requirements 2. Capacity Design - capacity design affects layout by determining the: output rate and output flexibility, and the level of capital intensity 3. Process Design - the way a product or service is produced will influence layout. Design issues include the: Sequence of processing operations for each output Processing equipment required for each operation Floor space requirements for equipment Inventory storage requirements for raw materials, work-in-progress, and finished goods
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4. Facility Location - the current site: what flexibility does it have in terms of: Size and configuration Expansion options 5. Job Design - the tasks that constitute work, and the activities necessary to complete the tasks. These influence: Work station operations and output Work station layout 6. Support Services - these are resources that support the primary production functions. They include: Maintenance, supervision, employee facilities Loading docks, storage, aisles, elevators

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General Classification of Layouts

Product (Flow Shop) Layout The physical components are arranged according to the progressive stages by which the product / service is provided. e.g. assembly lines, cafeterias. Layout built around a product that seeks the best personnel and machine utilization through repetitive or continuous production. Process (Job Shop) Layout The physical components are arranged, or grouped, according to the general function they perform, without regard to specific products / services provided. e.g. metal fabricators, hospitals, cafeterias. A layout that deals with low-volume, high-variety production. Fixed-Position Layout The product, because of its bulk or weight, remains in one location. All physical components are moved to the location where the product is being produced. e.g. shipyards, buildings. Layout that address the requirements of stationary projects or large, bulky projects. Group Technology Layout Dissimilar machines are grouped into work centres in order to work on products with similar shapes and processing requirements. e.g. aircraft manufacturing. It is basically a hybrid product / process layout.

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Job Shop vs. Group Technology Layout
L L Work Flow Inputs L L L L M M M M
Milling machines

M M

Job Shop
Work Flow Output

Lathe Work Centre

G G

G G

G G

D D

D D
Drill presses

D D

Grinding work centre

G M Work Flow Inputs L D D D

L D M

Group Technology
Work Flow Output

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Characteristics of Product and Process Layouts

Characteristics
Work Flow Output Mix Output Volume Inventories: Raw materials Work-in-progress Finished goods Floor Space Utilization Capital Costs Materials Handling Output Costs: Fixed costs Direct labour Direct materials

Product Layout
Fixed Small, standard High High Low High High High Mechanized High Low Variable

Process Layout
Variable Variable Moderate / low Low High Low Low Low Labour intensive Low High High

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Innovations at McDonalds

Indoor seating (1950s) Drive-through window (1970s) Adding breakfast to the menu (1980s) Adding play areas (1990s)

Three out of the four are layout decisions!

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McDonalds New Kitchen Layout

Fifth major innovation

Sandwiches assembled in order Elimination of some steps, shortening of others

No food prepared ahead except patty

New bun toasting machine and new bun formulation Repositioning condiment containers Savings of $100,000,000 per year in food costs

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McDonalds New Kitchen Layout

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Objectives for Facility Layouts

Objectives for Manufacturing Operation Layouts Provide enough productive capacity Reduce materials-handling costs Conform to site and building constraints Allow space for production machines Allow high labour, machine and space utilization and productivity Provide for volume and product flexibility Provide space for restrooms, cafeterias and other personal-care needs Provide for employee safety and health Allow ease of supervision Allow ease of maintenance Control capital investment

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Objectives for Facility Layouts - continued

Additional Objectives for Warehouse Operation Layouts Promote efficient loading and unloading of shipping vehicles Provide for effective stock picking, order filing and unit loading Allow ease of inventory counts Promote accurate inventory recordkeeping Additional Objectives for Service Operation Layouts Provide for customer comfort and convenience Provide an appealing setting for customers Allow an attractive display of merchandise Reduce travel of personnel or customers Provide for privacy in work areas Promote communication between work areas Provide for stock rotation for shelf life

Additional Objectives for Office Operation Layouts Reinforce organization structure Reduce travel of personnel or customers Provide for privacy in work areas Promote communication between work areas
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Supermarket Retail Layout
Objective is to maximize profitability per square foot of floor space Sales and profitability vary directly with customer exposure

Five Helpful Ideas for Supermarket Layout

1. Locate high-draw items around the periphery of the store

2.
3. 4.

Use prominent locations for high-impulse and high-margin items

Distribute power items to both sides of an aisle and disperse them to increase viewing of other items Use end-aisle locations

5.

Convey mission of store through careful positioning of lead-off department

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Supermarket Retail Layout

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Product Layout for a Bread Bakery
Raw Material

Milling

Mixing

Note the logical sequence of operations

Baking

Cutting

Packaging

Bread

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Facility Layout

Process Layout for a Hospital

Admissions

Emergency

X-Ray General Ward Surgery

Maternity Ward

Labour Room

Laboratory Intensive Care

Delivery Room

Kitchen Children's Ward

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Process Layouts: Its All About Flows

Resource Flows of Importance: 1. Manufacturing systems - material flows 2. Administrative offices - personnel flows 3. Hospital flows - patient, staff flows 4. Postal service - customer, mail flows 5. Restaurants - customer, staff flows Advantages of Process Layouts: 1. Systems can handle a variety of processing requirements. 2. System not vulnerable to equipment failure. 3. General-purpose equipment is less costly than the specialized equipment used in product layouts and is easier to maintain. 4. Possible to use individual incentive systems.

Disadvantages of Process Layouts: 1. In-process inventory costs are high. 2. Routing and scheduling are difficult.

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3. Equipment utilization rates are low. 4. Material handling is slow and inefficient and more costly per unit than under product layouts. 5. Job complexities often reduce the span of supervision and result in higher supervisory costs than product layouts do. 6. Special attention for each product or customer (routing, scheduling, machine setups, and so on) and low volumes result in higher unit costs than with product layouts. 7. Accounting, inventory control and purchasing are much more involved than under product layouts.

Designing Process Layouts

Main issue in the design of process layouts concerns the relative positioning of the departments involved. Process layouts features: 1. Some departments benefit from adjacent locations. 2. Some departments must be kept separate. 3. External factors such as the location of entrances, loading docks, elevators, windows, and areas of reinforced flooring have to be considered. 4. Flow costs for material and personnel within the building are critical.
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Steps for Process Layout

Step 1: Construct a from-to-matrix showing the flow of parts or materials from department to department. Step 2: Determine the space requirements for each department. Step 3: Develop an initial schematic diagram showing the sequence of departments through which parts will have to move. Try to place departments with a heavy flow of materials or parts next to one another. Step 4: Determine the cost of this layout by using the following equation: Minimize cost = XijCij where: n = number of work centres or departments
i,j = individual departments Xij = number of moves between department i and department Cij = cost of a move between department i and department
j
j

Step 5: Try to improve this layout by trial and error or by use of a computer program. Step 6: Prepare a detailed plan considering space or size requirements of each department.

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Facility Layout
Process Layout Illustration - Minimizing Flow Costs for a Toy Company
Step 1
1 2 3 4 5 6 7 8 1 2 175 3 25 0 4 0 100 17 5 30 75 88 20 6 200 90 125 5 0 7 20 80 99 0 180 374 8 25 90 180 25 187 103 7 1 2 3 4 5 6 7 8 Shipping & receiving Plastic molding & stamping Metal forming Sewing department Small toy assembly Large toy assembly Painting Mechanism assembly

Flows Between Departments (number of moves)

Department

Activity

Step 2

40

40 40

40

40 40

1
40

3
40

40

5
40

7
40

40

80
40

40

40

40

160

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Facility Layout
Process Layout Illustration - Minimizing Flow Costs for a Toy Company
Step 3 1
175 100 25 200

88

20

Step 4
1 2 3 4 5 6 7 8

2 175

3 25 0

4 0 100 17

5 60 150 88 20

6 400 180 125 5 0

7 60 240 198 0 180 374

8 75 270 360 50 187 103 7

Cost Matrix - First Solution Assume flow cost = 1 for adjacent moves Assume flow cost = 2 for moves over 1 dept Assume flow cost = 3 for moves over 2 depts (Assume diagonal moves are possible) Sample Calculations: 1 to 2 = 175 x 1 = 175 1 to 6 = 200 x 2 = 400 1 to 8 = 25 x 3 = 75, etc. Total cost = $3,449
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Facility Layout
Process Layout Illustration - Minimizing Flow Costs for a Toy Company
Step 5
Revised Layout Exchange 1 & 4 Why 1 & 4? You want to bring 1 and 6 next to each other, and this is one way to do it! Costs affected: 1&5, 1&6, 1&7, 1&8, 4&5, 4&6, 4&7, 4&8

1 1 2 3 4 5 6 7 8

2 175

3 50 0

4 0 100 17

5 30 150 88 40

6 200 180 125 10 0

7 40 240 198 0 180 374

8 50 270 360 75 187 103 7

Cost Matrix - Second Solution Cost reductions: 1&5 = 30, 1&6 = 200 1&7 = 20, 1&8 = 25 Cost additions: 4&5 = 20, 4&6 = 5 4&7 = 0, 4&8 = 25 Total cost = $3,234
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Facility Layout
Process Layout Illustration - Minimizing Flow Costs for a Toy Company

Step 6

Small Toy Assembly 5 Metal Forming 3

Mechanism Assembly 8 Plastic Mldg. / Assb. 2

Shipping and Receiving 1 Sewing

Large Toy Assembly 6 Painting

A final, feasible solution after several iterations

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Process Layout Illustration - Systematic Layout Planning

Even though the approach of minimizing flow costs is widely used, it suffers from the limitation of being able to focus on only one objective, and many situations involve multiple criteria. A more general approach, systematic layout planning (SLP), allows for subjective input from analysts or managers to indicate the relative importance of each combination of department pairs. The following is an example of SLP for the floor of a department store:
To 2 I 6 3 U --U --4 A 1,6 I 1 A 2,3 5 U --A 1,6 E 1 X 1 Area (sq. ft.) 100

From 1. Credit dept 2. Toy dept. 3. Wine dept. 4. Camera dept. 5. Candy dept.

400
300 100 100

Letter Number

Closeness Rating Reason for Rating

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Code 1 2 3 4 5 Reason Type of customer Ease of supervision Common personnel Contact necessary Share same space 5 2 3 4 1 Initial layout based upon relationship requirements (ignoring space and building constraints)

Psychology

Final layout adjusted by square footage and building size

2 5 3
50 ft.

4
20 ft.

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Facility Layout

Product Layout
These are layouts used to achieve a smooth and rapid flow of large volumes of products or customers through a system. The main characteristics of product layouts:

Standardized products requiring standardized processing Job divided into a series of tasks Specialization of labour and equipment Substantial investment in equipment and in job design Each item follows the same sequence of operations

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Product Layout: The Assembly Line Begin
Work flow
Station #1 Station #2 Station #3 Station #4

End

Materials and/or labour

Materials and/or labour

Materials and/or labour

Materials and/or labour

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Facility Layout
Main Advantages of Product Layouts
1. High rate of output 2. Low unit costs as fixed costs of specialized equipment spread over many units. 3. Labour specialization reduces training costs and time. 4. High utilization of labour and equipment. 5. Routing and scheduling are included in the initial design of system and do not require much attention once the system is in operation. 6. Accounting, purchasing and inventory control are fairly routine.

Primary Disadvantages of Product Layouts

1. Division of labour usually creates dull, repetitive jobs with little opportunity for advancement and may lead to morale problems. 2. System is inflexible in response to changes in volume of output or changes in product or process design. 3. System is susceptible to shutdowns caused by equipment breakdowns or employee absenteeism. 4. Preventative maintenance, the capacity for quick repairs and spare parts inventories are necessary expenses.
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Steps in Product Layout

Step 1: Develop the precedence diagram showing the sequence and performance times for each task.
Step 2: Calculate cycle time to meet the output requirement. Take the demand per day and divide it into the productive time available per day (in minutes or seconds). productive time Cycle time = Demand per day or production rate per day Step 3: Determine the theoretical minimum number of workstations. This is the sum of all task times divided by the cycle time. Fractions are rounded to the next higher whole number.
Minimum number of workstations =

time for task i

Cycle time Step 4: Perform the line balance by assign specific assembly tasks to each workstation. An efficient balance is one that will complete the required assembly, follow the specified sequence, and keep the idle time at each workstation to a minimum.

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Facility Layout
Line-Balancing Heuristics (Rules of Thumb)

Rule
1. Longest operating task time 2. Greatest number of following tasks 3. Ranked positional weight

Meaning
Choose the available task with the longest task time Choose the available task with the largest number of following tasks Choose the available task for which the sum of following task times is the longest Choose the available task with the shortest task time

4. Shortest operating task time

5. Least number of following tasks

Choose the available task with the least number of following tasks

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Facility Layout
Assembly Line Balancing Illustration

The problem: Pproduce 500 Model J Wagons per 8-hour day Setup time and work breaks total 45 minutes Production time available = 480 45 = 435 minutes Assembly steps and times for the Model J Wagon are given below:
Tasks That Must Precede

Task Time

Task Description

A B C D E F G H I J K

45 11 9 50 15 12 12 12 12 8 9 195

Position rear axle support and hand fasten 4 screws to nuts Insert rear axle Tighten rear axle support screws to nuts Position front axle assembly and hand fasten with 4 screws to nuts Tighten front axle assembly screws Position rear wheel #1 and fasten hub cap Position rear wheel #2 and fasten hub cap Position front wheel #1 and fasten hub cap Position front wheel #2 and fasten hub cap Position wagon handle shaft on front axle assembly and fasten bolt and nut Tighten bolt and nut

A A,B

D A,B,C A,B,C D,E D,E A,B,C,D,E,F,G,H,I J

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Facility Layout
Assembly Line Balancing Illustration Step 1: Draw the precedence diagram
12 11 45 9

F
12

G
8 9

50

15

12

H
12

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Facility Layout
Assembly Line Balancing Illustration Step 2: Calculate the cycle time
Cycle Time = time available / output required = 435 minutes / 500 units = 0.87 minutes = 52.2 seconds

Step 3: Calculate the minimum number of workstations

Minimum number of work stations = total task time / cycle time

= 195 seconds / 52.2 seconds = 3.74 = 4 stations

Step 4: Balance the line using the following heuristics (rules of thumb): 1. According to Greatest-Number-of-Following-Tasks rule 2. According to the Longest-Operating-Time rule

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Facility Layout
Assembly Line Balancing Illustration Step 4: Balancing the line using the Greatest-Number-of-Following-Tasks rule:

Workstation Station 1 Station 2 Station 3 Station 4 Station 5

Task A D B/E/C/F G/H/I/J K

Task Time 45 50

Idle Time 7.2 2.2

Feasible Remaining Tasks None None

Tasks With Most Followers

11/15/9/12 41.2/26.2/17.2/5.2 C,E/C,H,I/F,G,H,I/None 12/12/12/8 40.2/28.2/16.2/8.2 9 43.2 H,I/I/J/None None

C,E/C/F,G,H,I H,I

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Facility Layout
Assembly Line Balancing Illustration Step 4: Balancing the line using the Longest-Operating-Time rule:
Workstation Task Task Time Idle Time Feasible Remaining Tasks Tasks With Longest Operating Time

Station 1 Station 2 Station 3 Station 4

D A E/H/I/B C/F/G/J/K

50 45 15/12/12/11

2.2 7.2 37.2/25.2/13.2/2.2

None None H,I,B/I,B/B/None F,G/G/J/K E/H/I/B C/F/G/J/K

9/12/12/8/9 43.2/31.2/19.2/11.2/3.2

Efficiency of the line = total task time / (number of stations * cycle time):
Efficiency of line balance using the greatest-number-of-following-tasks rule = 195 / (5 x 52.2) = .747 = 74.7%
Efficiency of the line using the longest -operating-time rule = 195 / (4 x 52.2) = .934 = 93.4%

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Facility Layout

Production Lines: Western vs. Japanese

Japanese
1. Top priority: flexibility 2. Strategy: flexibility - expect to rebalance often to match output to changing demand 3. Flexible labour: move to current workload 4. Employ maximal preventive maintenance to keep equipment from breaking down 5. Slow for quality problems: speed up when quality is right 6. U-shaped or parallel lines 7. Put stations close together and avoid conveyors 8. Install small machines: add more as needed 9. Applied even to capital-intensive subassembly 10. Strive for mixed-model production, even in subassembly and fabrication

Western
1. Top priority: line balance 2. Strategy: stability - long production runs. Rebalancing seldom occurs 3. Assume fixed labour assignments 4. Use inventory buffers to cushion effect of equipment failure 5. Plan to run at fixed rate:. Send quality problems off line 6. Linear or L-shaped lines 7. Material movement by conveyor is desirable 8. Buy supermachines and keep them busy on a continuous basis 9. Applied in labour-intensive final assembly 10. Run mixed models where labour content is similar from model to model

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Characteristics of Japanese Manufacturing Layouts

production rates quickly and to change to different models.

Chief Objective: Manufacturing flexibility to give the ability to modify

Means of Achieving Objective:
1. Workers trained at many jobs. 2. Large investment in preventative maintenance. 3. Workers encouraged to solve production problems as they arise. 4. Workers and machines shifted as needed to solve production problems. 5. Production lines stopped or slowed when machine breakdowns or quality problems occur. 6. Little inventory carried. 7. Work stations placed close together.

Appearance of Layouts:
1. Small manufacturing floor plans. 2. Compact and tightly packed layouts. 3. Large percentage of floor space utilized for production. 4. U-shaped production lines.
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Facility Layout
Process Layout - Additional Illustration # 1
A small printing shop wishes to locate its seven departments in a one-floor building that is 40 units wide and 50 units long. Department sizes are : Department Layout Cutting Shipping Supply Storage Printing Binding Art Length (units) 10 20 10 20 25 20 20 Width (units) 10 10 10 15 20 20 20

The average number of loads flowing between departments is expected to be: From Dept Layout Layout --Cutting --Shipping --Supply Storage --Printing --Binding --Art --Cutting ------600 --100 100 Shipping ------100 --1000 --Supply Storage --100 500 --------Painting ------400 --200 100 Binding --400 --100 1200 ----Art --------100 -----

What is your layout recommendation?

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Facility Layout
Process Layout - Additional Illustration # 2
Eight work centres must be arranged in an L-shaped building. The location of centres A and E are designated as shown in the accompanying diagram. Assuming transportation costs are $2 per load per metre, develop a suitable layout that minimizes transportation costs using the information below. Distances (metres) From / To A B C D E F G H A -B 40 -C 40 60 -D 60 40 45 -E 120 60 85 40 -F 80 140 40 50 90 -G 100 120 70 40 50 40 -H 110 130 90 45 40 60 60 --

A* C F

B D G E* H

Loads per day From / To A B C D E F G H A -0 0 0 5 0 0 0 B 10 -220 110 40 80 45 0 C 5 140 -240 100 40 20 0 D 90 10 110 -180 70 50 20 E 365 0 10 10 -0 0 0 F 135 35 0 0 10 -40 0 G 125 0 0 0 40 10 -0 H 0 120 200 170 10 20 20 -4 - 39

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Facility Layout
Process Layout - Additional Illustration # 3 Hercules Manufacturing, a producer of corrugated cardboard boxes, is planning a 3600 square foot layout. The operations manager has obtained SLP ratings for locating departments next to each other.

From / To Storage Corrugator Folder/Gluer Taper/Bailer Inspection Shipping

Storage -------------

Corrugator AN -----------

Folder/Gluer U I ---------

Taper/Bailer U U AN -------

Inspection I U I U -----

Shipping U X U I AN ---

Area(sq.ft.) 1200 400 400 400 400 800

AN = Absolutely Necessary I = Important U = Unimportant X = Undesirable

What should be the layout used by Hercules Manufacturing?

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Product Layout - Additional Illustration # 1 Rival Manufacturing Company, a producer of can openers, has to balance its assembly line. Given below are the work elements, their times and their precedence requirements:
Work Element A B C D E F G H Time (sec.) 30 60 70 50 20 40 50 50 370 Demand per day is 400 can openers. Working time per day is 8 hours. a. Draw the precedence diagram. b. What is the theoretical number of work stations? c. What is the minimum number of work stations needed to achieve a cycle time of 70 seconds, using the greatest-number-of-following-tasks rule? d. What is the minimum number of stations needed to meet a cycle time of 100 seconds, according to the longest-operating-time rule? e. What are the balance delays in parts (c) and (d) ? Precedence -A A A A A,B,C A,C A,B,C,D,E,F,G

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Product Layout - Additional Illustration # 2
Able Manufacturing has an opportunity to bid on a contract to produce an electronic assembly. Able could use excess assembly capacity at its main production facility. The contract would require (over two years) of 30,000 units. Ables engineers suggest an assembly line consisting of nine tasks: Work Element A B C D E F G H I Time (min) 4 6 2 5 3 4 3 2 4 Must Follow G G B,D A,F D G I C,E ---

Assembly would occur on one shift with average productive time of 7.5 hours per employee daily. There would be twenty-two productive days per month on average. Direct labour costs are $11 per hour; variable overhead is estimated at 10 percent of direct labour; direct materials are $18 per unit; initial tooling for the project is $150,000 and semifixed costs of manufacturing for the assembly line are estimated at $8,000 per month. Able would like a 15 percent margin on selling price for such a contract. Should Able submit a bid and, if so, at what price?

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