Facility Planning has developed, in the past decade, into a major thriving business sector and discipline. One of major reasons for new facilities is the global economic boom that has been accompanied by an enhancement of capacity worldwide.
In addition to the global economic boom, there are several other reasons for changing or adding locations:
1. The cost or availability of labor, raw materials, and supporting resources often changes in resources may spur the decision.
2. As product markets change, the geographical region of demand may shift.
3. Companies may split, merge, or be acquired by new owners, making facilities redundant.
4. New products may be introduced, changing the requirement and availability of resources.
5. Political, Economic and legal requirements may make it more attractive to change location.
“Facility planning” denotes the generic meaning of the term. The term is used to include location, land, buildings, equipments, furnishings and all other such provisions to the physical capability of the organization that add to its value.
Well planned facilities enable an organization to function at its most efficient and effective level, offering real added value improvements to the organization’s core business.
Facilities are expensive. Their life time is in decades. They take years to commission. Since an organization must live with the facility for several years, any mistakes in choices can be very costly to the organization.
An objective assessment of the actual facility needs, supported by a foundation of market, utilization, operations and financial data, can save millions in unnecessary renovation and construction costs, as well as help create new revenues streams, and reduce ongoing operational costs.
A multidisciplinary approach to facility planning integrates strategic business planning, operations redesign, financial analysis and equipment/technology planning.
The objective for any facility that is created should be the following:
§ It should be located such that it provides better value to customers.
§ It should be equipped such that it needs of the population it services.
§ Once located, the facility should ensure a blend of an efficient work environment and maintain the most productive processing and flow in transformation or manufacturing process.
FACILITY PLANNING MATRIX
| Level | Activity | Space Planning Unit | Environment |
| Global | Site Location & Selection | Sites | World or Country |
| Macro Layout | Site Planning | Site Features & Departments | Site & Building Concept |
| Micro Layout | Facility, Building & Factory Layout | Buildings, Workstations Features | Plant or Department |
| Sub- Micro Layout | Workstations & Cell Design | Tool & Fixture Locations | Workstations & Cells |
Ideally, the design process from global to sub-micro is in distant, sequential phases. At the end of each phase, the design is “frozen” by consensus. Moving in a sequential manner helps management in the following manner:
- Settling the more global issues first.
- It allows smooth progress without continually revisiting unresolved issues.
- It prevents detail from overwhelming the project.
Based on Strategic importance, the macro layout is accepted to be the most critical and strategically important aspect of facility planning. However, all the stages have their own importance and significance.
Global Level
At the global level, Facility Planning is concerned in the selection of the site location which involves factors such as freight cost, labor cost, skill availability and site focus.
Macro Level planning
Site plans are developed at the Macro Level planning stage. These plans include number, size and location of buildings and infrastructure such as roads, rail, water, energy, etc.
Micro Level Planning
Facility planning at the Micro Level involves decisions about the functional layout and physical arrangement of economic activity centers. Economic activity centers are work related places that consume space.
Plant Location
Plant location is the function of determining where the plant should be located for maximum operating economy and effectiveness. The selection of a place for locating a plant is one of the important problems, which is faced by an entrepreneur while launching a new enterprise.
A selection on pure economic considerations will ensure an easy and regular supply of raw materials, labor force, efficient plant layout, proper utilization of production capacity and reduced cost of production. An ideal location may not, by itself, guarantee success; but it certainly contributes to the smooth and efficient working of an organization. A bad location, on the other hand, is a severe handicap for any enterprise and it finally bankrupts it. It is, therefore, very essential that utmost care should be exercised in the initial stages to select a proper place. Once a mistake is made in locating a plant, it becomes extremely difficult and costly to correct it, especially where large plants are concerned.
FACTORS THAT AFFECT LOCATION DECISIONS
Many factors influence location decisions. However, it happens that one or a few factors are so important that they dominate the decision. For example, in manufacturing, the potentially dominating factors usually include availability of an abundant energy and water supply and proximity to raw materials. Thus, nuclear reactors require large amount of water for cooling, heavy industries such as steel and aluminum production need large amounts of electricity, and so on. Transportation costs can be a major factor. Once an organization has determined the most important factors, it will try to narrow the search for suitable alternatives to one geographic region.
REGIONAL FACTORS
The primary regional factors involve raw materials, markets, and labor considerations.
Location of Raw Materials: Firms locate near or at the source of raw materials for three primary reasons: necessity, perishability and transportation costs. Mining operations, farming, forestry, and fishing fall under necessity. Firms involved in canning or freezing of fresh fruit and vegetables, processing of dairy products, baking, and so on, must consider perishability when considering location. Transportation costs are important in industries where processing eliminates much of the bulk connected with a raw material, making it much less expensive to transport the product or material after processing. Transportation costs are often the reason that vendors locate near their major customers.
Location of Markets: Profit-oriented firms frequently locate near the markets they intend to serve as part of their competitive strategy, whereas nonprofit organizations choose locations relative to the needs of the users of their services. Other factors include distribution costs or the perishability of a finished product.
Retail sales and services are usually found near the center of the markets they serve. Examples include fast food restaurants, service stations, dry cleaners, and supermarkets. Quite often their products and those of their competitors are so similar that they rely on convenience to attract customers. Hence, these businesses seek locations with high population densities or high traffic. The competition/convenience factor is also important in locating banks, hotels and motels, auto repair shops, drugstores, newspaper kiosks, and shopping centers. Similarly, doctors, dentists, lawyers, barbers, and beauticians serve clients who reside within a limited area.
Some firms must locate close to their markets because of the perishability of their products. Examples include bakeries, flower shops, and fresh seafood stores. For other types of firms, distribution costs are the main factor in closeness to market. For example, sand and gravel dealers usually serve a limited area because of the high distribution costs associated with their products. Still other firms require close customer contact, so they too tend to locate within the area they expect to serve. Typical examples are tailor shops, home re-modelers, home repair services, cabin makers, rug cleaners and lawn and garden services.
Locations of many government services are near the markets they are designed to serve. Hence, post offices are typically scattered throughout large metropolitan areas. Police and emergency health care locations are frequently selected on the basis of client needs. For instance, police patrols often concentrate on high crime areas and emergency health care facilities are usually found in central locations to provide ready access from all directions.
Software can be helpful in location analysis. For example, a graphic information system (GIS) is a computer based tool for collecting, storing, retrieving and displaying demographic data on maps. The data might involve age, incomes, type of employment, type of housing or other similar data.
LABOUR FACTORS:
Primary labor considerations are the cost and availability of labor, wage rates in an area, labor productivity and attitudes toward work and whether unions are a serious potential problem. Labor costs are very important for labor intensive organizations. The shift of the textile industry from the
Skills of potential employees may be a factor, although some companies prefer to train new employees rather than rely solely on previous experience. Increasing specialization in many industries makes this possibility even more likely than in the past. Although most companies concentrate on the supply of blue collar workers, some firms are more interested in scientific and technical people as potential employees and they look for areas with high concentrations of those types of workers.
Worker attitudes towards turnover, absenteeism and similar factors may differ among political locations-workers in large urban centers may exhibit different attitudes than workers in small towns or rural areas. Further, worker attitudes in different parts of the country or in different countries may be markedly different.
CLIMATE AND TAXES
Climate and taxes sometimes play a role in location decision. For example, a string of unusually severe winters in Northern states may cause some firms to seriously consider moving to a milder climate, especially if delayed deliveries and work disruptions caused by inability of employees to get to work have been frequent. Similarly, the business and personal income taxes in some sates reduce their attractiveness to companies seeking new locations.
Community Considerations:
A number of factors determine the desirability of a community as a place for its managers and workers to live.
- Quality of life: They include facilities for education, shopping, recreation, transportation, religious worship and entertainment.
- Services: These include the police, fire and medical services.
- Attitudes: Local attitudes towards the company, and the size of the community. Community size can be particularly important if a firm will be a major employer in the community.
- Taxes: It could be state and local, direct and indirect.
- Environmental regulations: It could be state and local.
- Utilities: Cost and availability.
- Development support: these include the bond issues, tax abatement, low-cost loans, grants and worker training.
- Just-in-time manufacturing techniques: it encourages suppliers to locate near their customers to reduce supplier lead times.
- Micro factory: Small factory with a narrow product focus, located near product focus, located near major markets.
Site-Related Factors:
The primary considerations related to sites are land, transportation and zoning or other restrictions. Evaluation of potential sites may require consulting with engineers or architects especially in the case of heavy manufacturing or the erection of large buildings or facilities with special requirements.
· Land: the main features include cost, degree of development required, soil characteristics and drainage, room for expansion, parking
· Transportation: the features here include access to roads, rail spurs and air freight, and even for firms with the executives travel frequently the size and proximity of the airport or train stations as well as travel connections can be important.
· Environmental/ Legal: it includes the zoning restrictions.
Need for selection of the location:
The need for the selection of the location may arise under any of the following conditions:
Ø When the business is newly started.
Ø The existing business unit has outgrown its original facilities and expansion is not possible; hence a new location has to be found.
Ø The volume of the business or the extent of market necessitates the establishment of branches.
Ø A lease expires and the landlord does not renew the lease.
Ø Other social or economic reasons; for instance, inadequate labor supply, shifting of the market, etc.
| Service/retail/professional | Industrial |
| Revenue Focus Cost determinates · Rent · Management Caliber operations policies (hours, wage rates) | Revenue Focus Cost determinates · Transportation cost of raw materials · Shipment cost of finished goods · Energy and utility cost · Cost of labor ;raw materials ;tax etc |
| Other · Volume/Revenue · Drawing areas, purchasing power · Completion · Advertising/Pricing · Physical Quality · Parking/Access · Security / Lighting Appearance/Image | Other · Intangible and future costs · Infrastructure- Roads, power etc · Labor –Management attitudes · Quality of life · Skill Enhancement and education · Facilities · Quality of state and local governments |
| Analytic Techniques · Correlation analysis of determined importance of factor for a particular type of operation · Traffic counts · Demographic analysis of drawing area · Purchasing power analysis of drawing area | Analytic Techniques · Linear Programming and transportation method · Load-distance models · Break-even analysis · Cross over charts |
| Assumptions · Location is a major determinant of Revenue · Issues manifesting from high customer contact | Assumptions · Location is a major determinant of cost · Major costs can be identified explicitly for each site · Low customer contact allows on cost · Intangible costs can be objectively evaluated |
FACTORY LOCATION MODELS
Various models are available which help to identify a near ideal location:
1) Factor rating method:
In this method, Factor ratings are used to evaluate alternative locations. The advantages of this method are:
a) Simplicity communicating why one location/site is better than another.
b) Enables to bring diverse locational considerations into the evaluation process.
c) Fosters consistency of judgement about location alternatives.
The steps involved are:
1) List the most relevant factors in the location decision.
2) Rate each factor according to its relative importance, i.e., a factor rating is given to each factor, based on its importance, the higher the ratings the more important is the factor.
3) Rate each location according to its merits on each factor.
4) Compute the product of ratings by multiplying the factor rating by the location rating for each factor.
5) Compute the sum of the product ratings for each location.
Decision: Select the location alternative which has the maximum sum of the product ratings as the choice.
2) Point rating method:
In locating a site or location, companies have several objectives, but all are not of equal importance. The relative weight of a company assigns to each objective or to each location factor may be represented by the number of points a perfect site would receive in each category. Each potential site is then evaluated with respect to every factor a company is looking for and points are assigned for each factor. The site with the highest total number of points is considered superior to other sites.
3) Break-even analysis:
In comparing several potential locations on an economic basis, (i.e. tangible factors), the only revenues and cost that need to be considered are the ones that vary from one location to another. If the revenue per unit is the same, regardless of where the goods is produced, the total revenues can be eliminated from consideration. An economic comparison of locations can be made by identifying the fixed costs and variable costs and plotting the break-even analysis on a graph for each location. This graphical approach can easily identify the range of annual production volume over which a location is preferable.
The steps involved are:
a) Determine all relevant costs that vary with each location.
b) Categorize the costs for each location into annual fixed costs and variable cost per unit and calculate the total cost for the desired volume of production per annum, for each location.
c) Plot the total costs associated with each location on a single chart or graph of annual cost versus annual production volume.
d) Select the location with the lowest total annual cost at the expected production volume per annum.
4) Qualitative factor analysis method:
If economic criteria are not sufficiently influential to decide the location alternative, a system of weighting the criteria might be useful in making a plant location decision. This approach is referred to as Qualitative Factor Analysis. The steps involved are:
a) Develop a list of relevant factors.
b) Assign a weight to each factor to indicate its relative importance.
c) Score each potential location according to the designated scale and multiply the scores by the weights to arrive at the weighted scores.
5) Centre of gravity method:
In the above method, we utilized a simple weighted scheme to assess the attractiveness of each location. Often location planners tend to use a distance measure to evaluate the impact of a proposed location. Such an approach has merit when there is a dominant requirement for locating close to the market for products. By locating far away, an organization may end up spending considerably on transportation and distribution. Therefore, assessing the distance of site vis-à-vis the reference market could be a better method for selecting appropriate locations.
In the centre of gravity method, all the demand points( or the supply points, if the raw material is supplied from several locations ) are represented in a Cartesian coordinate system. Each demand (or supply ) point will also have weights, which indicate the quantum of the demand ( or supply ) per unit time. In this context, it is possible to identify the centre of gravity of the various demand (or supply ) points. Locating the new facility at this point will be appropriate.
6) Load-distance method:
The load-distance method enables a location planner to evaluate two or potential candidates. Choosing the location with best load-distance among these will satisfy the objective of identifying an appropriate location for the proposed facility. Distance is measured using an appropriate location for the proposed facility. Distance is measured using a Cartesian measure.
Let us use the following notations for the load-distance method:
The number existing demand (or supply ) points in the grip map= n
Index used for existing demand ( or supply ) = 1
Coordinates of existing demand ( or supply ) points I in the grid map=( Xj, Yj)
The distance measure for the Cartesian coordinates between an existing demand ( or supply) points and a candidate facility (Dij) is given by:
Dij = sqrt((xi – Xj) 2 + (yi – Yj)2)
7)Transportation model:
There are several organization situations that prompt an organization to select multiple locations instead of one. While the choice of that multiple locations could be on the basis of the factors described above; the multiple location problem introduces another dimension to location design. The location planner must also decide which of the demand points will be served by each of these locations and to what extent.
The transportation model is an interesting variation of the Basic Linear Programming Model, which could be used to optimally identify a sub-set of supply points from a potential list that can satisfy the demand at various points. There is a unit transportation cost of shipping material from every supply point to every demand point, by an optimal choice of supply points, the total cost of transportation is minimized. In the process of doing this, it is insured that capacity constraints in the supply point is violated. Similarly, it is also ensured that at every demand point the requirement is fully satisfied.
CONSTRUCTING THE TRANSPORTATION TABLE:
First construct the initial transportation table by adding the available demand and supply information. If the demand and supply are unbalanced, the first step is to make the transportation problem balanced by adding dummy supply or demand point. Vogel’s Approximation method is used to find an optimal solution to the transportation problem.
SOLUTION USING VAM:
Step1: for each row and column compute the difference between the minimum cost cell an d the smallest cell.
Step 2: choose the row or column with the maximum difference. Assign as much as possible to the minimum cost cell in the chosen row or column. Decrement the supply and the demand values corresponding to the cell by the amount assigned. Delete either the row or column, whichever has become zero.
Step 3: if there is only one row or column left allocate to each of the remaining cells in the row or column and stop. Otherwise return to step1.
OTHER ISSUES IN LOCATION PLANNING:
Recent trends in international markets point to a shift towards fewer facilities that could serve markets worldwide. Two aspects effect the location planning problem significantly.
1) The availability of good transportation infrastructure.
2) The use of internet and IT infrastructure.
LOCATION DESIGN:
Availability of good transportation infrastructure enables firms to invest in fewer and larger facilities and provide a good level of service to customers. Infrastructure includes availability of an all-weather high speed road network, good railway infrastructure that is capable of transporting bulk cargo, availability of ports that have faster turnaround times and good connectivity to the ports. The recent attempts by the union government pertaining to the golden quadrilateral projects seek to address the issue.
In the era of the internet and IT, providing useful interfaces to customers may offset some of the short comings of location decisions. The advent of the internet has resulted in significant reduction in cost of communication and coordination among trading partners in recent years. This has great relevance for the location planning problem that operations management face. Due to the reduced cost of communication and coordination it is possible to have fewer locations and still provide better customer service.
TYPES OF LAYOUT:
A layout essentially refers to the arranging and grouping of machines which are meant to produce goods. Grouping is done on different lines. The choice of particular line depends on several factors. The methods of grouping or the types of layout are:
(1) Process layout, functional layout or job shop layout
(2) Product layout, line processing layout or flow line layout
(3) Fixed position layout or static layout
(4) Cellular manufacturing layout or group technology layout
(5) Combination layout or hybrid layout.
PROCESS LAYOUT:
Machines in each department attend to any product that is taken to them. These machines are therefore called as general purpose machines. Work has to be allotted to each department in such a way that no machine in any department is idle. In a batch production layout, machines are chosen to do as many different jobs as possible. The work which needs to be done is allocated to the machine according to loading schedules, with the objective of ensuring that each machine is fully loaded. This type of layout is best suited for intermittent type of production.
While grouping machines according to process types, certain principles must be kept in mind. They are:
(1) The distance between departments need to be short as possible with the view of avoiding long distance movement of materials.
(2) Though like machines are grouped in one department, the department should themselves be located in accordance with the principle of sequence of operations.
(3) Convenience for inspection
(4) Convenience for supervision. Process layout may be advantageously used in light and heavy engineering industries, made to order industries and the like.
ADVANTAGES
(1) Reduced investment on machines as they are general purpose machines.
(2) Greater flexibility in the production.
(3) Better and more efficient supervision is possible through specialization.
(4) There is greater scope for expansion as the capabilities of different lines can be easily increased.
(5) This type of layout results in better utilization of men and machines.
(6) It is easier to handle breakdown of equipment by transferring work to another machine or station.
(7) There is full utilization of equipment.
(8) The investment on equipment would be comparatively lower.
(9) There is greater incentive to individual worker to increase his performance.
DISADVANTAGES
(1) There is difficulty in the movement of materials. Mechanical devices for handling materials cannot be conveniently used.
(2) This type of layout requires more floor space.
(3) There is difficulty in production control.
(4) Production time is more as work in progress has to travel from place to place in search of machines.
(5) There is accumulation of work in progress at different places.
PRODUCT LAYOUT:
In product layout, if there is more than one line of production, there are as many lines of machines. The emphasis here, therefore is on special purpose machines, which are installed in the process layout. Therefore investment in straight line layout is higher than the investment on mechanics in a f
The grouping of machines should be done, on product line, keeping in mind the following principles.
(1) All machine tools or item of equipment must be placed at the point demanded by the sequence of operations.
(2) There should be no points where one line crosses another line.
(3) Materials may be fed where they are required for assembly, but not necessarily all at one point.
(4) All the operations, including assembly, testing and packaging should be included in the line.
The product layout may be advantageously followed in plants manufacturing standardized products on mass scale such as chemical, paper, sugar, rubber, refineries and cement industries.
ADVANTAGE
(1) There is mechanization of material handling and consequently reduction in material handling cost.
(2) This type of layout avoids production bottlenecks.
(3) There is economy in manufacturing time.
(4) The layout facilities better production control.
(5) It requires less floor area per unit of production.
(6) Work in progress is reduced and investment thereon, minimized.
(7) Early detection of mistakes or badly produced items is possible.
(8) There is greater incentive to a group of workers to raise their level of performance.
DISADVANTAGE
(1) Product layout is known for its flexibility.
(2) It is expensive.
(3) There is difficulty of supervision.
(4) Expansion is also difficult.
(5) Any breakdown of equipment along the production line can disrupt the whole system.
FIXED POSITION LAYOUT
Fixed position layout involves the movement of men and machines to the product which remains stationary. In this type of layout, the material or major component remains in a fixed location, and tools, machinery and men as well as other pieces of material are brought to this location. The movement of men and machines to the product is advisable because the cost of moving them would be less than the cost of moving the product which is very bulky.
This is followed in the manufacture of bulky and heavy products such as locomotives, ships, boilers, aircraft and generators. The construction of a building requires a fixed location layout because men, cement, sand, bricks and others are taken to site of construction.
ADVANTAGES
(1) Men and machines can be used for a wide variety of operations producing different products.
(2) The investment on outlay is very small
(3) The worker identifies himself with the product and takes pride in it when the work is complete
(4) The high cost and difficulty in transporting a bulky product is avoided.
CELLULAR MANUFACTURING (CM) LAYOUT:
In cellular manufacturing (CM), machines are grouped into cells and the cells function somewhat like a product layout within a larger shop or process layout. Each cell in the CM layout is formed to produce a single parts family – a few parts, all with common characteristics, which usually means that they require the same machines and have similar machine settings. The flow of parts within cells, can take many forms.
Among the advantages of cellular layout are lower work in progress inventories, reduced materials handling costs, shorter flow times in production, simplified production, planning(materials and labor), increased operator responsibilities, improved visual control and fewer tooling changes, therefore facilitating quicker set ups. Overall performance often increases by lowering production costs and improving on time delivery. Quality also tends to improve.
Disadvantages include reduced manufacturing flexibility and potentially increased machine-down time and finally duplicate pieces of equipment may be needed so that parts need not be transported between cells.
COMBINED LAYOUT
The application of the principles of product layout, process layout or fixed location layout in their strict meanings is difficult to come across. A combination of the product and process layouts, with an emphasis on either, is noticed in most industrial establishments. Plants are never laid out either pure form. It is possible to have both types of layout in an efficiency combined form if the products manufactured are somewhat similar and not complex.
Product Layout 
F.P= Forging Press G.C= Gear Cutting Machine
H.T=Heat Treatment Furnace G.G=Gear Grinding Machine
Combination layout or hybrid layout for gear manufacturing
In plants involving the fabrication of parts and assembly, fabrication tends to employ the process layout, while the assembly areas often employ the product layout. In soap manufacturing plants, the machinery manufacturing soap is arranged on the product-line principle; but ancillary services, such as heating, the manufacturing of glycerin, the powerhouse, the water treatment plant are arranged on a functional basis.
To extend the logic of the combined layout, we may refer to the application of the fixed location principle in every industrial establishment. Is it not true that workers are brought from different places in buses to the factory every day? Will not materials and tolls be carried to the place of manufacture every time?
To sum up: in the final analysis, the combination that produces the desired volume of products at the least total cost is preferred. Marketing is concerned with maximizing income, industrial engineering is concerned with minimizing cost and management is gambling that there is a sufficient difference in its favor.
SERVICE FACILITY LAYOUT
The fundamental difference between service facility and manufacturing facility layouts is that, many service facilities exist to bring together customers and services. Service facility layouts should provide for easy entrance to these facilities from freeways and busy thoroughfares. Large, well organized are some of the requirements of services facility layouts.
Because of different degrees of customer contact, two types of service facility layouts emerge, viz, those that are almost totally designed around the customer receiving and servicing function and those that are designed around the technologies, processing of physical materials and production efficiency.
Service Facility Layout (Hospital Layout)
| Parking Area | Casualty department and inpatient department | Parking Area | ||||||||||||
| Hospital Wards | Aisles & Gangways | Surgery, radiology, intensive care and technical services | ||||||||||||
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| Hospital Wards | Doctors’ Offices | Nurses’ Offices | Cafeteria | |||||||||||
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| Hospital Wards | Business Offices | |||||||||||||
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REVISION OF LAYOUT
As pointed out earlier, a good plant layout involves not only the designing and installing of the layout for the first time, but also encompasses revision of the existing layout as well. The best layout becomes obsolete over a period of time. When a plant has remained unchanged for a number of years, it can be assumed that the layout is obsolete in some way. Revisions ranging from minor alterations to a complete dismantling of the existing structure and installation of a new layout become necessary from time to time in order to increase and maintain the operating efficiency of the plant.
REASONS FOR REVISION OF LAYOUT:
Generally speaking, the following developments necessitate a revision of the existing layout:
- Expansion
- Technological advancements and
- Improvements in the layout
The reasons for revision are elaborated in the paragraphs that follow:
1. Expansion: Expansion is a natural feature of any industrial establishment. A plant may expand in any one of the following ways:
· Increase in the output of the existing product
· Introduction of a new product in the same line and
· Diversification of the lines of activity
In order to cater to the ever-increasing demand for its product, a plant may increase its capacity by installing a few more machines of the type already in operation or by adding machines of new designs and higher capacity. In such cases, the installation of new machinery will pose the same problem to the layout engineer as the designing and installation of a new layout for the first time. If the expansion in the capacity is sought to be achieved by adding a few more machines of the type already in operation, the problem is simple for the layout planner. There is no need to disturb the existing structure; and new machines are installed only to increase the capacity. The problem would have been further simplified if expansion had been foreseen and the provision for it had been made in the original layout plan but in discriminate installation of new machines where ever space permits, would result in overcrowding and chaotic conditions.
Expansions may also be achieved by introducing a new product in the same line. The sales of the existing products might decline because of keen competition. A new product of a better quality and bigger size, may be introduced to offset the loss, the line of production being same, the production of the new one may be carried out with the existing plant facility but such an arrangement should be temporary.
2. Technological advances: Thanks to industrial research, new products, new uses of existing products and materials, new machinery and new sources of energy have been and are being discovered. Industrial research is an insurance against obsolescence of products processes and plant layouts. Some of the technological advances are
a) Replacement of labor by machines
b) Developments in fuel and energy
c) Developments in process
d) Developments in materials
e) Improvements in product design
f) Advancement in information technology
Technological advances affect plant and equipment directly or indirectly. The layout of the plant must be revised to accommodate such improvements.
3. Improving the layout: Layout needs consistent attention from the management. It has to be reviewed and revised to correct deficiencies which may have crept in to the plant and which were originally unnoticed by the layout engineers. Even if the plant was perfectly laid initially, subsequent development in materials, machines and methods might render the layout deficient. Generally speaking, the limitations in the layout go unchecked for two reasons:
a) The evils of a poor layout are a hidden cost not revealed even by the best accounting method and
b) Even if the limitations are revealed, the management may be unwilling to initiate remedial steps because there is a built in adjustability to any circumstances in all human beings; and the management is no exception.
What is needed is a progressive outlook and courage on the part of the management to rectify defect. Once notified, they should be set right. These defects may be
a) Material handling costs are high
b) Aisles and individual work places are congested
c) Material in process is frequently damaged.
PRINCIPLES OF LAYOUT
While accepting the selected layout, the layout engineer should be guided by certain principles the layout selected in conformity with layout principles should be an ideal one. These principles are:
1. The principles of minimum travel: Men and material should travel the shortest distance between operations so as to avoid waste of labor and time and minimize the cost of material handling.
2. Principles of sequence: Machinery and operations should be arranged in a sequential order. This Principle is best achieved in product layout, and afford should be made to have it adopted in the process layout.
3. Principles of usage: Every foot of available space should be effectively utilized. This principle should receive top considerations in town and cities where land is costly.
4. Principle of compactness: There should be a harmonious fusion of all the relevant factors so that the final layout looks well integrated and compact.
5. Principle of safety and satisfaction: The layout should contain built in provisions for safety for workmen. It should be planned on the basis of the comfort and convenience of the workmen so that feel satisfied.
6. Principle of flexibility: the layout should permit for revisions with the least difficulty and at minimum cost.
7. Principle of minimum investment: The layout should result in saving in fixed capital investment, not by avoiding installation of the necessary facilities but by an intensive use of available facilities.
LAYOUT TOOLS
1. Templates: Templates are patterns which consist of a thin plate of wood or metal, which serves as a gauge or a guide in mechanical work. A plant layout template is a scaled representation of a physical object in a layout. The templates are fixed to a plan drawing and are moved around the drawing to explore the various layout possibilities until a layout, which eliminates unnecessary handling and back-tracking of materials and offers flexibility to admit revisions at the least cost, emerges.
2. Operations sequence analysis: Operations sequence analysis develops a good scheme for arrangement of departments graphically analyzing the layout problem. It helps to determine locations of operating departments relative to one another.
3. Line Balancing: Line Balancing is the phase of assembly line study that nearly equally divides the work to be done among the workers so that the total number of employees required on the assembly line is minimized.
OBJECTIVES OF A GOOD LAYOUT
1. Provide enough production capacity.
2. Reduce material handling costs
3. Reduce congestion that implies the movement of people or material
4. Reduce hazards to personnel
5. Utilize lab our efficiently
6. Increase employee morale
7. Reduce accidents
8. Utilize available space efficiently and effectively
9. Provide for volume and product flexibility
10. Provide ease of supervision
11. Facilitate co-ordination and face to face communication where appropriate
12. Provide for employee safety and health
13. Allow ease of maintenance
14. Allow high machine/equipment utilization
15. Improve productivity
IMPORTANCE OF LAYOUT
1. Economies in handling: Nearly 30%to40% of the manufacture costs is accounted for by material handling. Every effort should therefore be made to cut down on this cost. Long distance movement should be avoided and specific handling operation must be eliminated. A cynic may say that the cheapest way to handle material them at all. But in factory materials have to handle and therefore answer to question how best to avoid handling depends on layout.
2. Effective use of available area: Every inch of plant area is valuable especially in urban areas. Efforts should therefore be made to make use of the available area by planning the layout properly. Some steps for achieving this end are: location of equipment and services in order that they may perform multiple function development of up to data work areas and operator job assignments for a full utilization of the labor force.
3. Minimizations of production delays: Repeat orders and new customers will be the results of prompt executions of orders. Every management should try to keep to the delivery schedules. Often the deadline dates for delivery of production orders a bug-a-boo to the management.
Plant layout is significant factor in the timely executions of orders. A ideal plant layout eliminates such causes of delays as shortage of space, long distance movements of materials spoiled work and contributes to the speedy executions of orders.
4. Improved quality control: Timely execution of order will be meaningful when the quality of output is not below the expectations. To ensure inspection should be conducted at different stages of manufacture. An ideal layout provides for inspection to ensure better quality control.
5. Minimum equipment investment: investment on equipment can be minimized by planned machine balance and location minimum handling distances by the installation of general purpose machines and planned machine loading. A good plant layout provides all these advantages.
6. Avoidance of bottlenecks: bottlenecks refer to any place in production process where materials tend to pile up or produced at rates of speed less rapid than the previous or subsequent operations. Bottlenecks are caused by inadequate machine capacity in adequate storage space or low speed on the part of operators. The result of bottlenecks are delays in production schedules congestion accidents and wastage of floor area. All these may be overcome with an efficient layout.
7. Better production control: production control is concerned with the production of a product of the right type at the time and at reasonable cost. A cost plant layout is a requisite of good production control and provides the plant control officers with a systematic basis upon which to build organization and procedures.
8. Better supervision: A good plant layout ensures better supervision in two ways
a. Determining the number of workers to be handled by a supervisor and
b. Enabling the supervisor to get a full view of the entire plant at one glance. A good plant layout is therefore the first step in good supervision.
9. Improved utilization of labor: Labor is paid for every hour it spends in the factory. The efficiency of management lies in utilizing the time for productive purpose. A good plant layout is one of the factors in effective utilization of labour.
10. Improved employee morale: employee morale is achieved when workers are cheerful and confidence. This state of mental condition is vital to the success of any organization. Morale depends
a. Better working conditions
b. Better employee facilities
c. Reduced number of accidents
d. Increased earnings
11. Avoidance of unnecessary and costly changes: A planned layout avoids frequent changes which are difficult and costly. The incorporation of flexibility elements in the layout would help in the avoidance of revisions.
Factors influencing layout:
- Materials: the materials influence plant layout what is meant is that there is a need to provide for storage and movement of raw material in a plant until they are converted into finished product. Every factory should buy raw material economically when they are available; they should be store properly and moved through production centre efficiently for manual or mechanical operation or chemical processing. The storage and movement of raw materials require properly placed storage rooms and material movement or handling equipment.
- Product: a layout is designed with the ultimate purpose of producing a product that ii whether the product is heavy or light, big or small and its position in relation to the plant location influence the layout. The position of the product in relation to the other factor production deserves consideration in planning the layout of a plant.
- Worker: the layout designer should also consider the type, position and requirements of employees. If women workers are employed, the layout must be planned after keeping in mind their particular requirements. The position of employees, that is, whether they remain stationary or moving, also influences the layout.
- Machinery: the type of product, the volume of its production, the type of process and management policy determines the size and type of the machinery to be installed which, in turn, influences the plant layout. Production is the combination and manipulation of men, materials and machines.
- Type of Industry: The type of industry and the method of the manufacturing process exercise a significant influence on plant layout.
Industries in this context may be broadly classified into four types:
(a) Synthetic;
(b) Analytical;
(c) Conditioning;
(d) Extractive.
Extractive industries involve the separation of one element from another, as in the case of metal from the ore. A conditioning industry involves a change in form or physical properties. An analytical industry converts raw materials into various elements or constituent parts.
Based on the method of manufacture, these industries may be further classified into two types, namely:
(a) Intermittent industries; and
(b) Continuous industries.
- Location: the site selected for the location of a plant influences its layout in more than one way.
(1) The size and the terrain of the site determine the type of building which, in turn, influences the layout.
(2) The location of the plant determines the mode of transportation depending upon the distances from the source of raw materials and market to the plant.
(3) A plant location may be determined in part by the fuel requirements of the concern. The layout must provide for the storage of this fuel, whether it be coal, oil or gas.
- Managerial Policies: management policies significantly influence planned layout. The following are some managerial policies:
(a) The volume of production and provision for expansion;
(b) The extent of automation;
(c) Making or buying a particular component;
(d) Desire for rapid delivery of goods to customers;
(e) Purchasing policy;
(f) Personnel policies
It is obvious that many top management policies determine the plant layout objectives and the scope of the plant activities.
BIBLIOGRAPHY
1) Aswathappa K, Bhatt .K. Shridhara “Productions & Operations Management”, 2007, Himalaya Publishing House.
2) Mahadevan B, “Operations Management theory and Practise”
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