MBA, Semester 2 Operations Management Ms. Aarti Mehta Sharma

1. MBA, Semester 2Operations ManagementMs. Aarti Mehta Sharma

2. Facility Layout

3. The configuration of departments, work centers, and equipment, with particular emphasis on movement of work (customers or materials) through the system This could be for new plants or could be Improvements in layouts already in use to introduce new methods and improvements in manufacturing procedures. Facilities Layout

4. Requires substantial investments of money and effort Involves long-term commitments Has significant impact on cost and efficiency of operations Importance of Layout Decisions

5. Provide enough production capacity Reduce material Handling costs Reduce Congestion Reduce accidents / hazards to personnel Utilize labor efficiently Provide for volume and product flexibility Provide ease of supervision Allow ease of maintenance Allow high machine / equipment utilisation The arrangement should be congruent with the flow of materials Sequence of equipments In addition to floor space, the vertical space should also be considered. Objectives of a good layout

6. Cost of movement of materials from one work area to another Cost of space Cost of production delays, if any. Cost of spoilage of materials Cost of labor dissatisfaction and health risks Cost of changes, if any Cost of customer dissatisfaction due to poor service Costs

7. Product layouts Process layouts Fixed-Position layout Cellular Manufacturing Combination layouts Basic Layout Types

8. Product layout Layout that uses standardized processing operations to achieve smooth, rapid, high-volume flow Suitable for assembling operations eg. Automobile industry No. of equipment large Volume of production large Variety of products is low ; Two products ---- two product layouts Flow of materials Sequence of equipments

9. Product Layout Raw materials Station 2 machining Station 3 Heating Station 4 Painting Finished item Station 1 drilling Material and/or labor Material and/or labor Material and/or labor Material and/or labor Used for Repetitive or Continuous Processing

11. Wine mfg

12. Pizza

13. High rate of output Low unit cost Labor specialization not high Low material handling cost High utilization of labor and equipment Established routing and scheduling Routing accounting and purchasing Advantages of Product Layout

14. Creates dull, repetitive jobs Poorly skilled workers may not maintain equipment or quality of output Fairly inflexible to changes in volume Highly susceptible to shutdowns Needs preventive maintenance Individual incentive plans are impractical Disadvantages of Product Layout

15. Equipment performing similar functions is grouped together Volume of manufacturing is low Variety of products ( each customer is unique) Example : Customised Cars Process Layout / Job Shop production

16. Drilling Heating Painting Casting Machining Packaging Process Layout Process Layout (functional) Used for Intermittent processing Job Shop or Batch

17. Milling Assembly& Test Grinding Plating Drilling Process Layout - work travels to dedicated process centers Process Layout

19. 222 222 222 111 444 Mill 3333 22222 444 Grind 1111 2222 Assembly 333333333 44444 111 333 333333 Drill 111 111 Gear cutting 111 333 444 Lathes Heat treat

20. Exhibit 8.2 Process Layout for a Machine Shop

21. Can handle a variety of processing requirements Not particularly vulnerable to equipment failures Equipment used is less costly Possible to use individual incentive plans Advantages of Process Layouts

22. In-process inventory costs can be high Challenging routing and scheduling Equipment utilization rates are low Material handling slow and inefficient Complexities often reduce span of supervision Special attention for each product or customer Accounting and purchasing are more involved Disadvantages of Process Layouts

23. Fixed Position Layout • The position of product is fixed • Tools, Men and materials come to the product • Manufacture of Large products such as locomotives, boilers, ships, hospital etc

24. Men and machines can be used for a wide variety of operations producing different products Investment on layout is very small Worker identifies himself with the product and feels pride in it. Cost and difficulty of transporting a bulky product is avoided Advantages

25. Layout in which machines are grouped into a cell that can process items that have similar processing requirements The grouping into part families of items with similar design or manufacturing characteristics A complete product or part of a product is manufactured Cellular Layouts

28. Process Flows before the Use of GT Cells

29. Process Flows after the Use of GT Cells

30. Machine 2 Machine 3 Machine 1 Materials in Finished goods out Machine 4 Machine 5 One worker cell

32. Key enabler of increased production velocity and flexibility The reduction of capital requirements. Reduction of over production Products move through the manufacturing process one-piece at a time, at a rate determined by customers' needs Shifts worker responsibilities from watching a single machine, to managing multiple machines in a production cell. Advantages

33. Service facilities exist to bring together customers and facilities ( banks, hospitals ). Banks are designed around customer receiving and servicing Hospitals are designed around technology( X ray / radiology / pathology machines), processing of patients (receiving patients, settling accounts ) and operation efficiency ( surgery, gynecological, patient recovery). Easy entrance and parking space are an essential requirement Process Layout Service facility Layout

34. Receiving Department - raw materials (vendor oriented services) Shipping Department - finished goods are delivered to customers End of the plant Store room - raw materials, finished goods, partly finished goods and supplies are stored - close to the production centre Arrangement of other facilities

35. Inspection - of purchased material (raw materials, parts,supplies) - of work in process - of finished groups At every stage, every department Maintenance - of machinery / building - heating / air conditioning - machine and equipment installation - safety devices / fire protection - collection and disposal of waste / garbage / refuse

36. Employee Facilities - time clocks - toilets - drinking water - cafeteria - safety measures Other Facilities - power generators - water filters - chilling plant ( close to the boiler room )

37. By in house engg or planning department Depends upon the product Depends upon volume Determine process Determine flow of materials Decide upon equipment( also for material handling) and work centres Determine storage requirement Planning

38. Decide upon labor – direct / indirect Draw building specifications, floor plan Preparation of detailed layout planning Approval from Management Preparation of work schedule Construction starts

39. Templates Line Balancing Analysing with Computers Travel chart method Load Distance method Systematic Layout Planning Tools and Techniques

40. For comparison of alternative layouts Multiply actual distance moved and load (units) Try to minimize the same Illustration Two layouts A and B are given Data consists of the facility's products, distance between depts. and travel between depts. Determine the best layout Load distance analysis method

45. Service facilities Material flow not critical Develop a “relationship chart” / Richard Muther’s half – matrix / fish diagram Chart rates the relative importance of locating one dep't close to another Ratings are indicated by code letters a,e,i,o,u,x Developed by trail and error Systematic Layout Planning

46. Reasons (optional)

49. Credit Toy Wine Camera Candy Nearness Diagram