Chapter 9 Layout Strategy

Operations ManagementChapter 9 Layout Strategy

2006 Prentice 2006 Prentice Hall, Inc. Hall, Inc.

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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! 2006 Prentice Hall, Inc. 92

Strategic Importance of Layout DecisionsThe objective of layout strategy is to develop an economic layout that will meet the firms competitive requirements

2006 Prentice Hall, Inc.

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Layout Design Considerations Higher utilization of space, equipment, and people Improved flow of information, materials, or people

Improved employee morale and safer working conditions Improved customer/client interaction

Flexibility 2006 Prentice Hall, Inc. 94

Types of Layout1. Office layout 2. Retail layout

3. Warehouse layout4. Fixed-position layout

5. Process-oriented layout6. Work cell layout 7. Product-oriented layout 2006 Prentice Hall, Inc. 95

Types of Layout1. Office layout - positions workers, their equipment, and spaces/offices to provide for movement of information 2. Retail layout - allocates shelf space and responds to customer behavior 3. Warehouse layout - addresses trade-offs between space and material handling 2006 Prentice Hall, Inc. 96

Types of Layout4. Fixed-position layout - addresses the layout requirements of large, bulky projects such as ships and buildings 5. Process-oriented layout - deals with low-volume, high-variety production (also called job shop or intermittent production)


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Types of Layout6. Work cell layout - a special arrangement of machinery and equipment to focus on production of a single product or group of related products

7. Product-oriented layout - seeks the best personnel and machine utilizations in repetitive or continuous production 2006 Prentice Hall, Inc. 98

Good Layouts Consider1. Material handling equipment 2. Capacity and space requirements

3. Environment and aesthetics4. Flows of information

5. Cost of moving between various work areas


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Office Layout Grouping of workers, their equipment, and spaces to provide comfort, safety, and movement of information Movement of information is main distinction Typically in state of flux due to frequent technological changes 2006 Prentice Hall, Inc. 9 10

Relationship ChartValue1

Closeness Absolutely necessary Especially important Important Ordinary OK

A2 3 U 4 A I I I I I I A E O U E A O U I U O O 5 6 7 8 9

President Chief Technology Officer Engineers area SecretaryA O A O

EI O

UX

UnimportantNot desirable

Office entranceX

EU

Central filesO

UO X A E

I

Equipment cabinetU

Photocopy equipmentE

Storage room 2006 Prentice Hall, Inc.

Figure 9.19 11

Supermarket Retail Layout Objective is to maximize profitability per square foot of floor space Sales and profitability vary directly with customer exposure Things at the counter have the most exposure.


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Store Layout

Figure 9.2 2006 Prentice Hall, Inc. 9 13

Retail Slotting Manufacturers pay fees to retailers to get the retailers to display (slot) their product Contributing factors Limited shelf space An increasing number of new products Better information about sales through POS data collection

Closer control of inventory 2006 Prentice Hall, Inc. 9 14

Warehousing and Storage Layouts Objective is to optimize trade-offs between handling costs and costs associated with warehouse space Maximize the total cube of the warehouse utilize its full volume while maintaining low material handling costs

More location than layout decision. 2006 Prentice Hall, Inc. 9 15

Cross-Docking Materials are moved directly from receiving to shipping and are not placed in storage in the warehouse

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


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Fixed-Position Layout Product remains in one place Workers and equipment come to site Complicating factors Limited space at site Different materials required at different stages of the project

Volume of materials needed is dynamic 2006 Prentice Hall, Inc. 9 17

Alternative StrategyAs much of the project as possible is completed off-site in a productoriented facilityThis can significantly improve efficiency but is only possible when multiple similar units need to be created 2006 Prentice Hall, Inc. 9 18

Process-Oriented Layout Like machines and equipment are grouped together Scheduling can be difficult and setup, material handling, and labor costs can be high


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Process-Oriented LayoutPatient A - broken leg ER triage room Surgery

Emergency room admissionsPatient B - erratic heart pacemaker Laboratories

Radiology

ER Beds

Pharmacy

Billing/exit


Process-Oriented Layout Arrange work centers so as to minimize the costs of material handling Basic cost elements are Number of loads (or people) moving between centers Distance loads (or people) move between centers 2006 Prentice Hall, Inc. 9 21

Layout at Arnold Palmer Hospital


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Process-Oriented LayoutMinimize cost = wheren

Xij Cij

n

i=1 j=1

n = total number of work centers or departments i, j = individual departments Xij = number of loads moved from department i to department j Cij = cost to move a load between department i and department j9 23


Process Layout ExampleArrange six departments in a factory to minimize the material handling costs. Each department is 20 x 20 feet and the building is 60 feet long and 40 feet wide.1. Construct a from-to matrix

2. Determine the space requirements3. Develop an initial schematic diagram 4. Determine the cost of this layout

5. Try to improve the layout6. Prepare a detailed plan 2006 Prentice Hall, Inc. 9 24

Process Layout ExampleNumber of loads per weekDepartment Assembly Painting (1) (2) Assembly (1) Painting (2) Machine Shop (3) Receiving (4) Shipping (5) Testing (6) Machine Receiving Shop (3) (4) Shipping (5) Testing (6)

50

100 30

0 50 20

0 10 0 50

20 0 100 0 0


Process Layout ExampleRoom 1 Room 2 Room 3 Assembly Department (1) Painting Department (2) Machine Shop Department (3) 40 Receiving Department (4) Shipping Department (5) Testing Department (6)

Figure 9.5 2006 Prentice Hall, Inc.

Room 4

Room 5 60

Room 69 26

Process Layout ExampleCost = Cost = + +n

Xij Cij

n

i=1 j=1

$50 + $200 + $40 (1 and 2) (1 and 3) (1 and 6) $30 + $50 + $10 (2 and 3) (2 and 4) (2 and 5) $40 + $100 + $50 (3 and 4) (3 and 6) (4 and 5)

= $570 2006 Prentice Hall, Inc. 9 27

Process Layout ExampleInterdepartmental Flow Graph100

1

50

2 10

30

3

100

4

50

5Figure 9.6

6


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Process Layout ExampleCost = Cost = + +n

Xij Cij

n

i=1 j=1

$50 + $100 + $20 (1 and 2) (1 and 3) (1 and 6) $60 + $50 + $10 (2 and 3) (2 and 4) (2 and 5) $40 + $100 + $50 (3 and 4) (3 and 6) (4 and 5)

= $480 2006 Prentice Hall, Inc. 9 29

Process Layout ExampleInterdepartmental Flow Graph30

2

50

1

100

3

50 50

100

4

5Figure 9.7

6


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Process Layout ExampleRoom 1 Room 2 Room 3 Painting Department (2) Assembly Department (1) Machine Shop Department (3) 40 Receiving Department (4) Shipping Department (5) Testing Department (6)

Figure 9.8 2006 Prentice Hall, Inc.

Room 4

Room 5 60

Room 69 31

Computer Software Graphical approach only works for small problems Computer programs are available to solve bigger problems CRAFT

ALDEP CORELAP Factory Flow 2006 Prentice Hall, Inc. 9 32

Work Cells Reorganizes people and machines into groups to focus on single products or product groups Group technology identifies products that have similar characteristics for particular cells Volume must justify cells Cells can be reconfigured as designs or volume changes 2006 Prentice Hall, Inc. 9 33

Improving Layouts Using Work Cells

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

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

Figure 9.10 (b) 2006 Prentice Hall, Inc.

U-shaped line may reduce employee movement and space requirements while enhancing communication, reducing the number of workers, and facilitating inspection9 34

Requirements of Work Cells1. Identification of families of products 2. A high level of training and flexibility on the part of employees 3. Either staff support or flexible, imaginative employees to establish work cells initially 4. Test (poka-yoke) at each station in the cell 2006 Prentice Hall, Inc. 9 35

Staffing and Balancing Work CellsDetermine the takt timetotal work time available Takt time = units required

Determine the number of operators requiredtotal operation time required Workers required = takt time 2006 Prentice Hall, Inc. 9 36

Staffing Work Cells Example600 Mirrors per day required Mirror production scheduled for 8 hours per day From a work balance chart total operation time = 140 seconds60 Standard time required 50 40 30 20 10 0Assemble Paint Test Label Pack for shipment9 37

Operations 2006 Prentice Hall, Inc.

Staffing Work Cells Example600 Mirrors per day required Mirror production scheduled for 8 hours per day From a work balance chart total operation time = 140 seconds

Takt time = (8 hrs x 60 mins) / 600 units = .8 mins = 48 seconds total operation time required Workers required = takt time= 140 / 48 = 2.919 38


Work Balance Charts Used for evaluating operation times in work cells Can help identify bottleneck operations Flexible, cross-trained employees can help address labor bottlenecks Machine bottlenecks may require other approaches 2006 Prentice Hall, Inc. 9 39

Focused Work Center and Focused Factory Focused Work Center Identify a large family of similar products that have a large and stable demand Moves production from a general-purpose, process-oriented facility to a large work cell

Focused Factory A focused work cell in a separate facility May be focused by product line, layout, quality, new product introduction, flexibility, or other requirements 2006 Prentice Hall, Inc. 9 40

Focused Work Center and Focused FactoryWork Cell A work cell is a temporary productoriented arrangement of machines and personnel in what is ordinarily a processoriented facility. Focused Work Center A focused work center is a permanent productoriented arrangement of machines and personnel in what is ordinarily a processoriented facility. Focused Factory A focused factory is a permanent facility to produce a product or component in a product-oriented facility. Many focused factories currently being built were originally part of a process-oriented facility. Example: A plant to produce window mechanism for automobiles.

Example: A job shop Example: Pipe bracket with machinery and manufacturing at a personnel; rearranged shipyard. to produce 300 unique control panels. 2006 Prentice Hall, Inc.

Table 9.2

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Repetitive and ProductOriented LayoutOrganized around products or families of similar high-volume, low-variety products Volume is adequate for high equipment utilization

Product demand is stable enough to justify high investment in specialized equipment Product is standardized or approaching a phase of life cycle that justifies investment Supplies of raw materials and components are adequate and of uniform quality 2006 Prentice Hall, Inc. 9 42

Product-Oriented Layouts Fabrication line Builds components on a series of machines Machine-paced Require mechanical or engineering changes to balance Assembly line Puts fabricated parts together at a series of workstations Paced by work tasks Balanced by moving tasks Both types of lines must be balanced so that the time to perform the work at each station is the same 2006 Prentice Hall, Inc. 9 43

Product-Oriented LayoutsAdvantages1. 2. 3. 4. 5. Low variable cost per unit Low material handling costs Reduced work-in-process inventories Easier training and supervision Rapid throughput

Disadvantages1. High volume is required 2. Work stoppage at any point ties up the whole operation 3. Lack of flexibility in product or production rates 2006 Prentice Hall, Inc. 9 44

Assembly-Line Balancing Objective is to minimize the imbalance between machines or personnel while meeting required output Starts with the precedence relationships1. Determine cycle time 2. Calculate theoretical minimum number of workstations 3. Balance the line by assigning specific tasks to workstations


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Copier ExamplePerformance Time Task (minutes) A 10 B 11 C 5 D 4 E 12 F 3 G 7 H 11 I 3 Total time 66 Task Must Follow Task Listed Below A B B A C, D F E G, HThis means that tasks B and E cannot be done until task A has been completed


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Copier ExamplePerformance Time Task (minutes) A 10 B 11 C 5 D 4 E 12 F 3 G 7 H 11 I 3 Total time 66 Task Must Follow Task Listed Below A B B A C, D F E G, H

5

10

11

C

3

7

A

B4

F

G3

12

D

11

I

E

HFigure 9.13


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Copier ExamplePerformance Time Task (minutes) A 10 B 11 C 5 D 4 E 12 F 3 G 7 H 11 I 3 Total time 66 Task Must Follow Task Listed Below 480 available mins per day 40 units required

workstations

A Production time B available per day Cycle time = Units required per day B A = 480 / 40 5 C, D = 12 minutes per unit C F 10 11 3 7 n E i B G Minimum A i1Time for taskF G, H = 4 number of =Cycle D time12 11

3

I

= 66 / 12 E H = 5.5 or 6 stationsFigure 9.13 2006 Prentice Hall, Inc. 9 48

Line-Balancing Heuristics

Copier Example

1. Longest task time Choose the available task 480 available Performance Task Must Followlongest task time with the mins per day Time Task Listed Task Most following tasksBelow 40 units 2. (minutes) Choose the available task required with the largestCycle time = 12 mins number of A 10 following tasks B 11 A Minimum = 5.5 C 3. Ranked positional 5 B workstations for or 6 Choose the available task D B weight4 which the sum of following E 12 A task times is the longest 5 F 3 C, D Choose the available task C G 4. Shortest task time 7 F 10 shortest task time 11 3 7 with the H 11 E A B G F I 5. Least number of 3 G,Choose the available task H 4 3 following with the least number of Total time 66 tasks D I 12 11 following tasksE

H Table 9.4Figure 9.139 49


Copier ExamplePerformance Time Task (minutes) A 10 B 11 Station C 5 2 D 4 11 E 10 12 F A B 3 G 7 H 11 I 3 12 Station Total time 66 E 1Station 3 2006 Prentice Hall, Inc.

Task Must Follow Task Listed Below A 5 B C B A C, D 4 F D E G, H

480 available mins per day 40 units required Cycle time = 12 mins Minimum workstations = 5.5 or 63 7

FStation 4

G

3

I11Station 6

HStation 5 Figure 9.149 50

Copier ExamplePerformance Time Task (minutes) Task Must Follow Task Listed Below 480 available mins per day 40 units required

A 10 Cycle time = 12 mins B 11 A Minimum C 5 B workstations = 5.5 or 6 D 4 B E 12 A F 3 C, D G 7 F Task times Efficiency = (actual number of workstations) x (largest cycle time) H 11 E I 3 G, H = 66 minutes / (6 stations) x (12 minutes) Total time 66 = 91.7%


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Chapter 9 Layout Strategy

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