Office Space Requirements
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Universal Axioms
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Manufacturing managers in large companies tend to
overestimate their individual cell or departmental
space needs
Manufacturing space is like a closet, clutter will
continue to collect until it fills the space provided
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General Considerations
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No magic formulas to follow
Experienced managers will overstate their
requirements
Inexperienced managers will understate their
requirements
Main aisles in a light manufacturing plant will
account for approximately 10% - 18% of
total under roof floor space
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The Big Three Budget
Limitations
1.
Cost Limitations
2.
Schedule Limitations
3.
Human Resources Limitations
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Gross Business Ratios
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Space versus sales ratios
Revenue ratio
Plant ratios or ratio ranges
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Estimate data for large companies
Use public domain information
Office area is fairly consistent
Manufacturing size varies by type (cellular,
assembly line, etc.)
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Space-Related Ratios
Useful for existing plant expansion . . .
Total Production Space
Space-related Ratio =
Number of Production Workers
Take note of the current working conditions:
• Congested = “worst” case scenario
• Functional = “optimal” scenario
Baseline the expansion on these numbers
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Space-Related Ratio Example
A local manufacturer has determined the following:
• Space is considered “tight”
• They have 50 employees
• They currently occupy a 5,000 sq. ft. facility
• Expected 5 year growth = 75 employees
What do we know?
Employee / Space Ratio = 5,000 / 50 = 100 sq. ft / employee
Anticipated facility size in 5 years = 75 X 100 sq. ft.
= 7,500 sq. ft.
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Ratio Caution
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A ratio is like a forecast. . . it’s only an
estimate of the future
Review the past sales / production
history
Review the economic conditions during
the growth periods
Use the ratios as a guide
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Space Balance Analysis
Most often used classifications:
 Primary operations
 Secondary operations
 Inspection and test areas
 Storage areas
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Raw materials
WIP
Finished goods
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Space Balance Analysis
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Service and support
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Maintenance
Tool cribs
Shipping / Receiving dock areas
Offices
Aisles
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Space Utilization
Space Utilization
7%
20%
8%
Service / Support
12%
Molding
Offices
Light Assy
Aisles
Shipping / Receiving
Warehouse
19%
17%
17%
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Site Saturation Planning
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Completely utilized configuration
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No room for building additions
No room for expansion
Framework for master facility plan
Estimates are derived for maximum
facility layout
Used to determine maximum production
output on existing site
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Site Saturation Planning
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Completely utilized configuration
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No room for building additions
No room for expansion
Framework for master facility plan
Estimates are derived for maximum
facility layout
Used to determine maximum production
output on existing site
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Site Saturation Planning
Neglecting site saturation
planning can result in long-term
consequences costing the
organization significant capital
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Equipment Utilization
Consideration
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Equipment utilization impacts layout space
Don’t plan on 100% equipment utilization
levels
Take PFD into consideration
Rely on historical data including utilization
and maintenance
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Equipment Utilization
Consideration
Example:
• Equipment currently runs at 65%, producing 500 pcs./day
• OEM states production runs of 769 pcs./day
• Growth projections require 1,300 pcs./day
• Management expects 85% utilization through improvements
How many machines are required to meet production growth?
(500 pcs./day X 85%) / 65% = 653 pcs./day
1,300 / 653 = 2 machines required [negligible OT projected]
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Adjusting Today’s Needs
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Also known as conversion or converting
Tally all currently used space
Calculate the space for aisles
Interview and observe the workers
Collect data from the workers
Confirm and correct estimates
Base projections on the data
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Adjusting Today’s Needs – From the
Trenches
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Space required for increasing capacity
or production levels in not linear
The Conversion methodology uses a
subjective or approximate approach
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Evaluate each situation carefully
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Used for basic level planning
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Equipment Utilization
Consideration
Example:
A walk-through of the existing 1,225 sq. ft. department
(operating 24 / 7 @ maximum capacity) indicates congestion.
This area could use an increase of 5% - 10% of space.
Develop a baseline SWAG of future space allotment if the
area doubles in capacity through increased demand.
Using the Conversion method:
(1,225 sq. ft. X 108%) X 2 = 2,646 sq. ft. estimated
Average = 8%
Double capacity
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Determining Space Needs
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Known as a Rough Layout or Production
Center method
Detail each piece of equipment
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Indicate door swings
Special access areas
Approximate equipment spacing
Utility requirements (water, air, power, etc.)
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Elements of a Push System
Procurement
Schedule
Processing
Schedule
Material
Orders
Assembly
Schedule
Work
Orders
Production
Schedule
Work
Orders
Suppliers
Materials
Warehouse
Fabrication
In-Process
Inventory
Assembly
Product
Warehouse
In-Process
Inventory
Trigger or process driver
Information flow and material flow
Inventory management
Work order control vs. visual control
Integration of suppliers
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Elements of a Pull System
Fabrication
Usage
Suppliers
Assembly
Usage
Fabrication
Point of use
Storage
Customer
Demand
Assembly
Product
Warehouse
In-Process
Inventory
Trigger or process driver
Information flow and material flow
Inventory management
Work order control vs. visual control
Integration of suppliers
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Pull Production System
In a Pull System, coordinating the
production and movement of parts and
components between processes is
critical in avoiding over production or
shortages.
To achieve this coordination, you can
use a system called “Kanban.” Kanban
is a mechanism for managing a pull
production system.
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Kanban
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Kanbans have been in use in the US prior to
the mid-1960s
One of the most widely used systems before
MRP and MRP-II
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Requires maintaining minimal inventory levels
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Kanban starts at the end . . . Shipping
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Kanban
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Kanban is also known as “pull” manufacturing
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Kanban loosely translated to “card”
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Kanban is a simple visual scheduling and
replenishment approach
Kanban signals can be cards, containers,
lights, “Poker Chips”, etc.
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Pull Signal Calculation
Production Kanban
An example of a simple pull signal (Kanban) calculation where a
constant quantity of product is withdrawn at varying intervals:
K =
Dr * Tr * (1+Fm)
Uk
Where:
K = Number of Kanban (number of signals)
And:
Dr = Demand Rate
Tr = Replenishment Lead Time (for feeder)
Uk = Units per Kanban (per signal)
Fm = Management Factor (safety factor)
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Pull Signal Calculation
Supplier Kanban
An example of a simple pull signal (Kanban) calculation where a
variable quantity of product is provided at constant intervals:
K =
Dr * (2 + Td) * (1+Fm)
(Uk * Dd)
Where:
K = Number of Kanban (number of signals)
And:
Dr = Demand Rate
Td = Transit Delay (for supplier)
Uk = Units per Kanban (container capacity)
Dd = Deliveries per Day
Fm = Management Factor (safety factor)
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Inventory
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Convert inventory to physical space terms
Inventory holding costs have a significant
impact on the bottom line of a company
Increased production does not directly reflect
increased inventory
Reduce inventory where possible
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Inventory
Inventory
Do we have to
make trade-offs?
Current
Capability
Customer Order
Lead Time
On-Time
Delivery
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Space Need Pitfalls
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Ratios and projections are
approximations
Many companies guess at
space needs
Forecasting errors
Overestimating space
requirements
Poor understanding of the
manufacturing process
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Questions & Comments
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