Download - 3 Location Layout
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MS1506 Managing operations and processes
Layout and locationSee Greasley chapters 4–5
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Layout
Layout is the physical arrangement of transforming resources at a particular location
Deciding where to place machine, equipment and staff
ObjectivesMinimise materials handling and movement of peopleReduce hazards of handlingGive logical flow to materialsUse space efficientlyReduce time for operations
Four basic layout typesFixed position, functional (or process), cell, product
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Layout decisions
Fixed positionFunctional
ProjectJobbingBatchMassContinuous
ProfessionalserviceService shopMass service
Physical positioning of transforming resources
Volume andvariety Process type
Basic layout type
Decision 1
Decision 2
Detailed designof layout
Decision 3
Strategicobjectives
Flow of transformed resources
CellProduct
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Fixed position layout
Product or project stationaryWorkers, materials and equipment moved as needed
ExamplesLarge construction projects: houses, roads, ships, aircraftOpen heart surgeryRestaurants (service element)Home help services
Design issuesEach site need areas allocated for materials and equipmentDifficult to minimise movement of transforming resources
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Fixed position example
Layout design is largely limited to allocating space for staff and equipment
How do we arrange transforming resources here?
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Functional (or process) layout
Emphasis on convenient location of transforming resourcesOften these are large and difficult to moveTransformed resources moved to transforming resources
ExamplesHospital: XRay, mri, … are in fixed location; patients movedSupermarket: frozen products located togetherComponents manufacture: parts moved through separate job shops
Design issuesIdeally keep total movement between different areas small
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Functional layout
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Functional layout
Lathes Milling Drilling
Grinding
PolishingAssembly
Shipping and receiving
A
A
A
A
B
B
B
BB
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Product layout
Emphasis on arranging transforming resources for convenience of transformed resourcesSometimes called line layout – tends to create assembly linesTransformed resources moved through transforming resources
ExamplesCar assembly linesSelfservice restaurants
Design issuesManage timing so that flow is not slowed substantially by specific processes
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Product layout
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Cell layout
Compromise between functional and product layoutTransforming resources grouped into cells (group technology)Cells arranged in functional layoutWithin cells, product (or sometimes functional) layout
ExamplesMaternity unit in hospital: ‘cells’ for prenatal, birth and postnatal ‘services’Some component manufacture: cells for assembly and packaging of components
Design issuesChoice of cells, product and functional layout issues
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Cell layout: vision express
Reception Desk Waiting Area
Preliminarychecks
Eye Tests
Consultation on
frames
Laboratories
Entrance
Spectacles collection
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Mixed layout
Commonly operations use mixed layout types incorporating features of other layouts
For example a hospital may use features of fixed position layout in surgery, functional layout for XRay, mri, and cell layout for maternity facilities
A house builder may use fixed position layout for the main construction activities, but may also have functional layout building prefabricated units, which are then brought to site
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Comparison of layoutsadvantages disadvantages
Fixed position
functional
cell
product
Very high mix and product flexib-ility. High variety of tasks. Product/customer not disturbed.
Very high unit costs. Can be dif-ficult to schedule space and activ-ities.
High product and mix flexibility. Less prone to disruptions. Easy to supervise.
Low utilisation. Can have high work-in-progress. Complex flow.
Often good compromise between cost and flexibility. Fast throughput. Group work can be motivating.
May be costly to introduce (re-arrange existing layout). May need more equipment.
Low unit costs for high volume. Opportunities for specialisation.
Often low mix flexibility. Disrup-tion of one process affects whole operation. Repetitive work.
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Selecting a layout: volume, variety, flow
low volume high
Regular flow more important
regu
lar f
low
eas
ier t
o ac
hiev
ehighvariety
low
fixedposition
product
cell
functional
continuousflow
intermittentflow
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Selecting a layout: process types
professionalservices
fixed position layout
product layout
cell layout
functional layout
continuous
jobbing
project
batch
mass
mass services
service shops
manufacturingprocess types
layout types serviceprocess types
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Detailed design: functional layout
Steps in Developing a functional layout
0. Construct a “fromto matrix”1. Determine space requirements for each department2. Develop an initial schematic diagram3. Determine the cost of this layout4. By trialanderror (or more sophisticated means), try
to improve the initial layout5. Prepare a detailed plan that evaluates factors in addi
tion to transportation cost
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Cost of ProcessOriented Layout
Minimize cost =∑i=1
n
∑j=1
n
x ij c ij
where n= total number of work centers or departmentsi , j are individual departmentsx ij=number of loads moved from department i to department jc ij= cost to move a load between department i and department j
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Example
The following movements take place between the different departments of a workshop
Suggest an efficient layout
goods in machining painting assembly shipping goods in 45 3 6 6 0
machining 10 38 46 24 2painting 4 30 15 12 0
assembly 5 40 20 50 4qc 3 4 11 8 43
shipping 1 2 2 3 21
qc
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Diagram for functional layout
goods in
shipping
QC
assembly
painting
machining
A absolutely essentialE extremely importantI importantO ordinaryU unimportantX undesirable
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Example
goods in
shipping
QC
assembly
painting
machining
0
7
68
4
9
2
28
11
7
23
86
64
58
33
55
A absolutely essentialE extremely importantI importantO ordinaryU unimportantX undesirable
Total movements
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Example
goods in
shipping
QC
assembly
painting
machining
U
O
A
U
O
U
I
O
O
I
A
A
A
E
A
A absolutely essential > 50E extremely important 30–49I important 15–29O ordinary 5–15U unimportant 0–5X undesirable
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Suggested layout
goods in
shippingQCassembly
paintingmachining
The following layout ensures most important movements are between departments that are close to each other
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Detailed design: product layout
Line balancing technique
ExampleIt takes 3 minutes to build a productThis 3 minutes’ work can be broken down into 3 steps each of 1 minute
It still takes total of 3 minutes’ activity per item
1 minute 1 minute1 minute
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Example: cycle time for one person
It takes 3 minutes to build a productOne person can process 20 products in an hour, with a cycle time of 3 minutes
Throughput time is also 3 minutesWe cannot change throughput time, but can we produce 60 items per hour (cycle time of 1 minute)?
Detailed design: product layout
1 minute 1 minute1 minute
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Example: cycle time for three people
We could give the same tasks to three people
Alternatively, we could give each person a separate taskuses less equipmentEither way cycle time reduced to 1 minuteThroughput time 3 minutes
Detailed design: product layout
1 minute 1 minute1 minute
1 minute 1 minute1 minute 1 minute 1 minute1 minute1 minute 1 minute1 minute
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Another example
Throughput time is four minutesWith three operators, cycle time is 2 minutes
The actual cycle time of the line is determined by the slowest process in the sequence
Can we reduce the cycle time to 1 minute?
1 minute 2 minute1 minute
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Another example
If we add one more operator to last workstation
cycle time for last workstation is average time between units of output = 2 minutes / 2 = 1 minute
So cycle time for process is now one minute
1 minute
2 minute
1 minute
2 minute
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Precedence diagrams
Standard products—where volume and price are important—are assembled in line production
The product or service is simplified by breaking it down into a series of simpler tasks
The relationship of one task to another is called the precedence diagram
The individual tasks are collected together in work stations, then carried out in a sequence—a line—which allows the product to be assembled efficiently
Line balancing ensures as far as possible that the work contents of the stations are equal
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Precedence diagrams
Activity Predecessor Time (mins)
a — 7
b — 2
c a 6
d a 4
e b 3
f c,d,e 8
g f 1
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Precedence diagram
a
b
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Precedence diagrams
Activity Predecessor Time (mins)
a — 7
b — 2
c a 6
d a 4
e b 3
f c,d,e 8
g f 1
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Precedence diagram
a
b
d
c
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Precedence diagrams
Activity Predecessor Time (mins)
a — 7
b — 2
c a 6
d a 4
e b 3
f c,d,e 8
g f 1
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Precedence diagram
a
b
d
c
e
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Precedence diagrams
Activity Predecessor Time (mins)
a — 7
b — 2
c a 6
d a 4
e b 3
f c,d,e 8
g f 1
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Precedence diagram
a
b
d
c
e
f
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Precedence diagrams
Activity Predecessor Time (mins)
a — 7
b — 2
c a 6
d a 4
e b 3
f c,d,e 8
g f 1
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Precedence diagram
a
b
d
c
e
f g
7 min
1 min8 min
3 min
4 min
6 min
2 min
Total time required: 31 minutes
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Line balancing
Cycle time: the time between units of output
Once a production target has been set, the line must produce at a rate that ensures demand is met: the required cycle time
To achieve the right output, the processing time for each work station must not exceed the required cycle time.
To achieve the right output, the number of work stations (n) must be at least the total processing time for each product (T) divided by the required cycle time (C)
number of workstations n≥T /C
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Defining the workstations
a
b
d
c
e
f g
7 min
1 min8 min
3 min
4 min
6 min
2 min
6 min
7 min
9 min
9 min
Required cycle time: 9 minutes
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Balancing loss
total work time = required cycle time × number of workstationsidle time = total work time − total processing time for 1 unit
balancing loss = idle timetotal work time
balancing loss represents proportion of time lost becausewe need to use some idle time to divide work betweenworkstations
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Balancing loss example
total work time = required cycle time × number of workstations =9 minutes ×4=36 minutesidle time = total work time − total processing time for 1 unit =36 minutes −31 minutes =5 minutes
balancing loss = idle timetotal work time
=5 minutes
36 minutes≈13.9 %
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Detailed design of cells
Cells designed by grouping similar products/services
ExampleElectronic products packed by combination of machines in sequenceFive products use the following
Product 1 2 3 4 5antistatic bag x x
foam filler x xbag x xbox x x x
label x xxrfid tag
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Detailed design of cells
Example
We can rearrange the matrix to get two natural cells
General technique is called production flow analysis (see chapter 4 of textbook)
Product 1 3 4 2 5bag x x
label x xantistatic bag x x
foam filler x xbox x x x
xrfid tag
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Location: some definitions
Capacity: quantity of products/services that operation can produce per unit timeIt may produce less than this (underutilisation)
Location: where the capacity isThis affects the conditions for supply and demand
Supply: quantity of products/services that other producers are willing and able to sell during a given period and under a given set of conditions
Demand: quantity of products/services that customers are willing and able to buy during a given period and under a given set of conditions
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Factors affecting location decision
Objectives for locationCostOnly the costs that depend on location are important
Revenue potentialHow much revenue the location may produce
Service provisionWhat service the operation can provide customers (e.g. dependability, speed, quality) at a location
Ideally we want to minimise cost and maximise revenue and maximise service provision at the same timeIn practice, this is usually impossible and so a compromise is sought
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Supply and demand factors
We consider how cost, service provision and revenue are affected by many factors
To select factors of importance, consider supply and demand, and environment
OperationSupply Demand
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Supplyside factors
Labour costsThese vary from location to location, depending on availability and cost of labourUsually measured in cost per unit of production
Land costsThese vary from country to country and are usually greater in cities than outside
Energy costsImportant for heavy industries that use a lot of energy
Transportation costsUnit cost of transporting raw materials from source to operation
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Demandside factors
Convenience for customerImportant for service provision and revenue potential to be near customers
Suitability of siteE.g. hotels usually situated in attractive regions rather than industrial areas
Image of locationFor example, some high streets create a reputation for highquality goods and services
Labour skillsFor example, farm shops located outside towns attract customers looking for higher grade produce
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Environmental factors
Tax rates (especially between countries) and tariffsGovernment assistancePolitical/economic stabilityLocal attitudes to investmentLanguageCultureLabour relationsEnvironmental regulations (e.g. pollution)Availability of support servicesLocal amenities
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Location for goods and services
Operations producing goodsTypically transportation and energy costs are more importantLow customer contact diminishes importance of many demandside factors
Operations producing servicesOperations with direct customer contacte.g. department store, restaurant, hotelusually supplyside factors dominate
Operations with indirect customer contacte.g. call centres, ecommercereduced importance of supplyside factors
Operations with no customer contacte.g. creditcard processingLabour/land costs more important
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Location decision
Country decisionPolitical/economic environmentexchange ratesaccess to markets
Region decisionLand costsRegional incentivesAvailability of labour
Site decisionSite size and costtransportAvailability of services
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Summary
Process mapping: what adds value?Process layoutsFixed positionProductFunctionalCellDetailed functional layout designDetailed product layout design: line balancingDetailed cell layout design: production flow analysis
Location
ObjectivesSupplyside and demandside factors