Chapter 8
How Process Layout
fits the Operations Management
Philosophy
Process Layout
Chapter 8
Operations As a Competitive
Weapon
Operations Strategy
Project Management
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© 2007 Pearson Education
¾ Layout planning is planning that involves decisions
about the physical arrangement of economic activity
centers needed by a facility’s various processes.
¾ Layout plans translate the broader decisions about the
competitive priorities, process strategy, quality, and capacity
of its processes into actual physical arrangements.
¾ Economic activity center: Anything that consumes
space -- a person or a group of people, a customer
reception area, a teller window, a machine, a
workstation, a department, an aisle, or a storage
room.
© 2007 Pearson Education
Layout Planning
Questions
Before a manager can make decisions
regarding physical arrangement, four
questions must be addressed.
1. What centers should the layout include?
2. How much space and capacity does
each center need?
3. How should each center’s space be
configured?
4. Where should each center be located?
© 2007 Pearson Education
Absolute Locations vs.
Relative Locations
Location Dimensions
Original
layout
¾ The location of a center has two
dimensions:
1. Relative location: The placement of a
center relative to other centers.
2. Absolute location: The particular space
that the center occupies within the facility.
Frozen
foods
Bread
Meats
Dry
groceries
Vegetables
Revised layout
Meats
Dry
groceries
Vegetables
Process Layout
Supply Chain Strategy
Location
Inventory Management
Forecasting
Sales and Operations Planning
Resource Planning
Scheduling
© 2007 Pearson Education
Layout Planning
© 2007 Pearson Education
Process Strategy
Process Analysis
Process Performance and Quality
Constraint Management
Process Layout
Lean Systems
Frozen
foods
Bread
Four of the absolute
locations have
changed but not the
relative locations.
© 2007 Pearson Education
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Chapter 8
Strategic Issues
¾ Layout choices can help communicate an
organization’s product plans and competitive
priorities.
¾ Altering a layout can affect an organization and how
well it meets its competitive priorities in the following
ways:
1.
2.
3.
4.
5.
6.
Increasing customer satisfaction and sales at a retail store.
Facilitating the flow of materials and information.
Increasing the efficient utilization of labor and equipment.
Reducing hazards to workers.
Improving employee morale.
Improving communication.
© 2007 Pearson Education
Performance Criteria
¾
¾
¾
¾
¾
¾
¾
¾
¾
Customer satisfaction
Level of capital investment
Requirements for materials handling
Ease of stockpicking
Work environment and “atmosphere”
Ease of equipment maintenance
Employee and internal customer attitudes
Amount of flexibility needed
Customer convenience and levels of sales
© 2007 Pearson Education
Types of Layouts
A Flexible Flow Layout
A job shop has a flexible-flow layout.
¾ Flexible-flow layout: A layout that organizes
resources (employees) and equipment by function
rather than by service or product.
¾ Line-flow layout: A layout in which workstations or
departments are arranged in a linear path.
¾ Hybrid layout: An arrangement in which some
portions of the facility have a flexible-flow and
others have a line-flow layout.
¾ Fixed-position layout: An arrangement in which
service or manufacturing site is fixed in place;
employees along with their equipment, come to the
site to do their work.
© 2007 Pearson Education
A production line has a line-flow layout.
© 2007 Pearson Education
Process Layout
Forging
Lathes
Painting
Welding
Drills
Office
Milling
machines
Foundry
© 2007 Pearson Education
Creating Hybrid Layouts
Line Flow Layout
Station 1
Grinding
Station 2
Station 3
Station 4
¾ Layout flexibility is the property of a facility to
remain desirable after significant changes occur or to
be easily and inexpensively adopted in response to
changes.
¾ A One-worker, multiple-machines (OWMM) cell is
a one-person cell in which a worker operates several
different machines simultaneously to achieve a line
flow.
¾ A Cell is two or more dissimilar workstations located
close together through which a limited number of
parts or models are processed with line flows.
© 2007 Pearson Education
2
Chapter 8
One Worker,
Multiple Machines
Machine
2
Machine
1
Group Technology (GT)
Machine
3
Materials in
Finished
goods out
Machine
4
Machine
5
© 2007 Pearson Education
¾ Group Technology (GT) is an option for
achieving line-flow layouts with low-volume
processes; this technique creates cells not
limited to just one worker and has a unique
way of selecting work to be done by the cell.
¾ The GT method groups parts or products
with similar characteristics into families and
sets aside groups of machines for their
production.
© 2007 Pearson Education
Before Group Technology
Applied Group Technology
Jumbled flows in a job shop without GT cells
Line flows in a job shop with three GT cells
Lathing
Milling
Drilling
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Grinding
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Receiving and
shipping
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Receiving
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Assembly
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Assembly
area
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Shipping
© 2007 Pearson Education
Designing
Flexible-Flow Layouts
¾ Step 1: Gather information
¾ Space requirements by center
¾ Available space
¾ Closeness factors: which centers need to be located close
to one another.
¾ Closeness matrix: A table that gives a measure of
the relative importance of each pair of centers being
located close together.
¾ Step 2: Develop a Block plan: A plan that allocates
space and indicates placement of each department.
¾ Step 3: Design a detailed layout.
Process Layout
D
Cell 2
Cell 3
© 2007 Pearson Education
© 2007 Pearson Education
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Cell 1
Gather Information
Example 8.1
Office of Budget Management
Space Requirements
Department
Area Needed (ft2)
1. Administration
2. Social services
3. Institutions
4. Accounting
5. Education
6. Internal audit
3,500
2,600
2,400
1,600
1,500
3,400
Total
15,000
Current Block Plan
3
6
4
1
2
5
100'
150'
© 2007 Pearson Education
3
Chapter 8
3
6
4
2
5
3
100'
1
Closeness Matrix
150'
6
4
2
5
100'
1
First put departments 1 and 6 close together
Example 8.1 Office of Budget Management
Next put departments 3 and 5 close together
Trips between Departments
Department
1. Administration
2. Social services
3. Institutions
1
—
2
3
4
5
6
3
6
5
6
10
—
8
1
1
3
9
—
2
—
4. Accounting
5. Education
© 2007 Pearson Education
Then put departments 2 and 3 close together
2
6
3
100'
1
—
6. Internal audit
Proposed Block Plan
150'
—
Departments 1 and 6 have the most interaction.
Departments 3 and 5 have the next highest.
Departments 2 and 3 have next priority.
4
1
150'
© 2007 Pearson Education
Applying the
Weighted- Distance Method
¾ Weighted-distance method: A mathematical
model used to evaluate flexible-flow layouts based
on proximity factors.
Distance Measures
Euclidian Distance
dAB =
¾ Euclidean distance is the straight-line distance, or
shortest possible path, between two points.
¾ Rectilinear distance: The distance between two
points with a series of 90 degree turns, as along city
blocks.
© 2007 Pearson Education
5
(x
(xA – xB)2 + (y
(yA – yB)2
Rectilinear Distance
dAB = |x
|xA – xB| + |y
|yA – yB|
© 2007 Pearson Education
Application 8.1
Calculating the WD Score
Load Distance Analysis
Example 8.2
Current Plan
What is the distance between (20,10) and (80,60)?
Euclidian Distance
dAB =
(20 – 80)2 + (10 – 60)2
= 78.1
Rectilinear Distance
dAB = |20 – 80| + |10 – 60| = 110
© 2007 Pearson Education
Process Layout
Proposed Plan
Dept Closeness Distance
Distance
Pair Factor, w
d
wd Score
d
wd Score
1,2
1,3
1,4
1,5
1,6
2,3
2,4
2,5
3,4
3,5
4,5
5,6
© 2007 Pearson Education
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20
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6
27
2
2
ld = 112
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18
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12
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Chapter 8
First Proposed Plan
Second Proposed Plan
Excel Solver
evaluation of
solution
© 2007 Pearson Education
Excel Solver
improved solution
© 2007 Pearson Education
Application 8.2
© 2007 Pearson Education
Application 8.2
© 2007 Pearson Education
Other Decision
Support Tools
Application 8.2
¾ Automated layout design program
(ALDEP): A computer software package
that constructs a good layout from scratch,
adding one department at a time.
¾ Computerized relative allocation of
facilities technique (CRAFT): A heuristic
method that begins with the closeness
matrix and an initial block layout, and makes
a series of paired exchanges of departments
to find a better block plan.
© 2007 Pearson Education
Process Layout
© 2007 Pearson Education
5
Chapter 8
Warehouse Layouts
Warehouse Layouts
Out-and-back Pattern
Zone System
¾ The most basic warehouse layout is the out-and-back pattern.
The numbers indicate storage areas for same or similar items.
Zones
5
5
6
Dock
Control
station
4
2
7
Tractor
trailer
Aisle
1
5
5
4
4
2
7
Tractor
trailer
Feeder
lines
Storage area
© 2007 Pearson Education
Feeder
lines
Overflow
© 2007 Pearson Education
Designing
Line-Flow Layouts
Office Layouts
¾ Line balancing is the assignment of work to
stations in a line so as to achieve the desired output
rate with the smallest number of workstations.
¾ Work elements are the smallest units of work that
can be performed independently.
¾ Immediate predecessors are work elements that
must be done before the next element can begin.
¾ Precedence diagram allows one to visualize
immediate predecessors better; work elements are
denoted by circles, with the time required to perform
the work shown below each circle.
¾ Most formal procedures for designing office layouts
try to maximize the proximity of workers whose jobs
require frequent interaction.
¾ Privacy is another key factor in office design.
¾ Four common office layouts:
1. Traditional layouts
2. Office landscaping (cubicles/movable partitions)
3. Activity settings
4. Electronic cottages (Telecommuting)
© 2007 Pearson Education
© 2007 Pearson Education
Line Balancing
Example 8.3
Green Grass, Inc., a manufacturer of lawn & garden equipment,
is designing an assembly line to produce a new fertilizer spreader,
the Big Broadcaster. Using the following information, construct a
precedence diagram for the Big Broadcaster.
Work
Element
A
B
C
D
E
F
G
H
I
Time Immediate
Description
(sec) Predecessor(s)
Bolt leg frame to hopper 40
None
Insert impeller shaft
30
A
Attach axle
50
A
Attach agitator
40
B
Attach drive wheel
6
B
Attach free wheel
25
C
Mount lower post
15
C
Attach controls
20
D, E
Mount nameplate
18
F, G
Total
Line Balancing
Green Grass, Inc.
D
B
244
E
C
F
25
50
I
G
Process Layout
© 2007 Pearson Education
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6
A
40
H
40
30
© 2007 Pearson Education
Shipping
doors
Click to add title
Storage area
3
Zones
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Chapter 8
Desired Output and
Cycle Time
Theoretical Minimum
Theoretical minimum (TM ) is a benchmark or goal
for the smallest number of stations possible, where
total time required to assemble each unit (the sum of
all work-element standard times) is divided by the
cycle time. It must be rounded up
¾ Desired output rate, r must be matched to the
staffing or production plan.
¾ Cycle time, c is the maximum time allowed for
work on a unit at each station:
1
c=
Idle time is the total unproductive time for all
stations in the assembly of each unit.
r
Efficiency (%) is the ratio of productive time to
total time.
Balance Delay is the amount by which efficiency
falls short of 100%.
© 2007 Pearson Education
© 2007 Pearson Education
Calculations for
Output Rate and Cycle Time
Example 8.4 continued
Example 8.4
Theoretical minimum (TM ) - sum of all work-element
standard times divided by the cycle time.
Green Grass, Inc.
¾ Desired output rate, r = 2400/week
Plant operates 40 hours/week
r = 2400/40 = 60 units/hour
TM = 244 seconds/60 seconds = 4.067
It must be rounded up to 5 stations
Cycle time: c = 1/60 = 1 minute/unit = 60 seconds/unit
¾ Cycle time, c = 1/60
Efficiency (%) - ratio of productive time to total time.
1
r
= 1 minute/unit
Efficiency = [244/5(60)]100 = 81.3%
= 60 seconds/unit
Balance Delay - amount by which efficiency falls short of 100%.
(100 − 81.3) = 18.7%
© 2007 Pearson Education
© 2007 Pearson Education
The goal is to cluster the work elements
into 5 workstations so that the number of
work-stations is minimized, and the cycle
time of 60 seconds is not violated. Here
we use the trial-and-error method to find
a solution, although commercial software
packages are also available.
Green Grass, Inc.
D
B
30
S3
S1
A
S2
40
C
© 2007 Pearson Education
Process Layout
H
40
20
E
S4
F
25
50
c = 60 seconds/unit
TM = 5 stations
Efficiency = 81.3%
Application 8.3
Line Balancing Solution
6
S5
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G
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18
© 2007 Pearson Education
7
Chapter 8
Application 8.3
© 2007 Pearson Education
Application 8.3
© 2007 Pearson Education
Application 8.4
Other Considerations
Finding a Solution
In addition to balancing a line, managers must also
consider four other options:
1. Pacing: The movement of product from one station
to the next as soon as the cycle time has elapsed.
2. Behavioral factors of workers.
3. Number of models produced: A mixed-model line
produces several items belonging to the same
family.
4. Cycle times depend on the desired output rate, and
efficiency varies considerably with the cycle time
selected. Thus exploring a range of cycle times
makes sense.
© 2007 Pearson Education
Process Layout
© 2007 Pearson Education
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