Process Selection and Facility Layout: MIS 373: Basic Operations Management
Process Selection and Facility Layout: MIS 373: Basic Operations Management
Process Selection and Facility Layout: MIS 373: Basic Operations Management
SELECTION AND
FACILITY LAYOUT
Chapter 6
• Process selection
• Deciding on the way production of goods or
services will be organized
• Occurs when:
• Planning of new products or services
• Technological changes in product or equipment
• Competitive pressure
Facilities and
Forecasting Capacity Equipment
(demand)
Planning
Process
Technological Selection Work
Change Design
• Process Types
Repetitive/
Job Shop Batch Assembly Continuous
Description Customized Semi- Standardized Highly
goods or standardized goods or standardized
services goods or services goods or
services services
Advantages Able to handle a Flexibility; easy Low unit cost, Very efficient,
wide variety to add or high volume, very high
of work change efficient volume
products or
services
Disadvantages Slow, high cost Moderate cost Low flexibility, Very rigid, lack of
per unit, per unit, high cost of variety, costly
complex moderate downtime to change,
planning and scheduling very high cost
scheduling complexity of downtime
Opportunity
costs
Volume
Out of
pocket costs
Project: used for work that is none routine with a unique set of objective to be accomplished
in a limited time frame, e.g., launching a new product, publishing a book
Products/Services Processes
Ice-cream manufacturer Job-shop
Automatic carwash
Batch
Steel
Repetitive
Books
Continuous
Airlines
Surgery
Movie theater
Sugar
Tips: Think in terms of those key dimensions:
Beer o Range of products or services that can be processed
Flour o Expected order sizes
o Expected frequency of schedule changes
TECHNOLOGY
• Technological Innovation
• The discovery and development of new or improved products,
services, or processes for producing or providing them
• Technology
• The application of scientific discoveries to the development and
improvement of products and services and/or the processes that
produce or provide them
• Layout
• The configuration of departments, work centers, and equipment, with
particular emphasis on movement of work (customers or materials)
through the system
• Product layout
• Layout that uses standardized processing operations to achieve
smooth, rapid, high-volume flow
• Process layout
• Layout that can handle varied processing requirements
• Combination layouts
MIS 373: Basic Operations Management 16
PRODUCT LAYOUTS
• Product layout
• Layout that uses standardized processing operations to achieve
smooth, rapid, high-volume flow
• How?
• L:
• O: Image source: mdcegypt.com
• S:
• U: more compact, increased communication facilitating team work,
minimize the material handling
Advantages Disadvantages
• High rate of output Creates dull, repetitive jobs
• Low unit cost Poorly skilled workers may not
• Labor specialization maintain equipment or quality of
output
• Low material handling cost per
Fairly inflexible to changes in
unit
volume or product or process design
• High utilization of labor and
Highly susceptible to shutdowns
equipment
Preventive maintenance, capacity
• Established routing and
scheduling for quick repair and spare-parts
inventories are necessary expenses
• Routine accounting, purchasing,
Individual incentive plans are
and inventory control
impractical
MIS 373: Basic Operations Management 20
PROCESS LAYOUTS
Advantages Disadvantages
• Can handle a variety of • In-process inventories can be high
processing requirements • Routing and scheduling pose
continual challenges
• Not particularly vulnerable
to equipment failures • Equipment utilization rates are low
• General-purpose equipment • Material handling is slow and less
efficient
is often less costly and
easier and less costly to • Complicates supervision
maintain • Special attention necessary for
each product or customer
• It is possible to use
individual incentive systems • Accounting, inventory control, and
purchasing are more complex
MIS 373: Basic Operations Management 21
FIXED POSITION LAYOUTS
• Cycle time
• The maximum time allowed at each workstation to
complete its set of tasks on a unit
• Minimum Cycle Time = longest task time = 1.0 min
• Maximum Cycle time = Σt = sum of task time = 2.5 min
2
3
Start with CT
(1.2 min. in this
example)
MIS 373: Basic Operations Management 32
• Assign tasks in order of the most number of followers
Revised
Time Assign Time Station
Workstation Remaining Eligible Task Remaining Idle Time
1 1.2 a, c a 1.1
2
3
2
3
2
3
Start with CT
(1.2 min. in this
example)
Start with CT
(1.2 min. in this
example)
a&b c&d e
(0.1+1.0) (0.7+0.5) (0.2)
• Efficiency
• Percentage of busy time of a line
Efficiency = 100% − Balance Delay
MIS 373: Basic Operations Management 43
EXAMPLE:
MEASURING EFFECTIVENESS
Revised
Time Assign Time Station
Workstation Remaining Eligible Task Remaining Idle Time
1 1.2 a, c a 1.1
1.1 c, b b 0.1
0.1 c - 0.1
2 1.2 c c 0.5
0.5 d d 0 0.0
3 1.2 e e 1.0
1.0
= 20.83%
DESIGNING PROCESS
LAYOUTS
• The main issue in designing process layouts concerns the
relative placement of the departments
• Measuring effectiveness
• key objectives in designing process layouts are to
minimize:
• transportation cost
• distance
• time
A B C
• Heuristic:
• Assign departments with the greatest interdepartmental work flow first
to Operations
MIS 373: Basic locations that are closet to each other.
Management 53
EXAMPLE: MINIMIZE
Distance
TRANSPORTATION COSTS
40
Location Trip
From\To A B C A-B 20 Closest
A - 20 40 B-C 30 C
A B 30
20
B - 30 A-C 40
C -
Place dept. 1&3
Work flow in A&B
Department Pair Work flow
From\To 1 2 3 1-3 170 Highest work flow
1 - 30 170 2-3 100
2 - 100 1-2 30
3 -
11 33 33 11
A B C A B C C
A B 30
20
170 100
1 3 2
A B C
MIS 373: Basic Operations Management 55
CLOSENESS RATINGS
• Muther’s grid
A Absolutely necessary
E Very important
Dept. 1 I Important
A
Dept 2. A O Ordinary importance
E X U Unimportant
Dept 3. U U X Undesirable
X I O
Dept 4. A A
O X
Dept. 5 A
A Suppose this is the floor plan of
Dept 6. your company, how would you
arrange the six departments?
A X Dept. 1
A
1-2 1-4 Dept 2. A
E X
1-3 3-6 Dept 3. U U
2-6 3-4 X I O
Dept 4. A A
3-5 O X
Dept. 5 A
4-6 A
5-6 Dept 6.
2 6
1 5
MIS 373: Basic Operations Management 3 60
CLOSENESS RATINGS:
4 EXAMPLE
2 6
Dept. 1
1 5 A
3 1 Dept 2. A
E X
4 Dept 3. U U
3 X I O
Dept 4. A A
6 O X
6. Fit cluster into arrangement (e.g., 2x3) Dept. 5 A
A
may require some trial and error. Dept 6.
Departments are considered close not only when they touch side
to side but also when they touch corner to corner.
1 2 6
3 5 4