Location Planning Capacity Planning and Layout Planning Module IV

Location PlanningCapacity Planning

and Layout Planning

Module IV

Facility Location Planning:Decision Factors

Low Construction Cost

Land Availability At low Cost

Proximity To Subcontractor

Availability Of Skilled Labour

Residential Facility

ProximityTo Market

Proximity To RawMaterials

Availability Of Power

ConnectivityWith Air/Rail & Road

SupportiveGovt. Policies

Socio- EconomicEnvironment

FacilityLocationPlanning

Offensive in competitor’s

home country

Power & prestige

Synergy

Economies of scale

Exploitation of firm specific advantages Incentives

Low costs

Additional resources

Regulations

International competition

International customers

Trade barriers

International Facility

Location Planning

Factors in International Location Planning

Location DecisionRelevant Factors

Market related issues Cost related issues Market for products and services Wage rates Raw Material availability Transportation costs Number and proximity of suppliers Taxes and other tariff issues Availability of skilled labour

Quality of Infrastructure

Regulatory & Policy issues Other issues Government & Economic stability Culture Quality of legal and other institutions Climate

Trading blocks and trading agreements Quality of Life

Location Planning Methods

• One Supply Point – Multiple Demand Centers– Location factor rating– Centre of Gravity Method– Load Distance Method

• Multiple Supply Points – Multiple Demand Centers– Transportation Model

Location Factor Rating MethodSteps

• Identify and list down all the relevant factors for the location decision

• Establish the relative importance of each factor in the final decision

• Rate the performance of each demand location using a rating mechanism

• Compute a total score for each location based on its performance against each factor and rank them in the decreasing order of the score

Example• A manufacturer of garments is actively considering five alternative

locations for setting up its factory. • The locations vary in terms of the advantages that it provides to the

firm. Hence the firm requires a method of identifying the most appropriate location.

• Based on a survey of its senior executives the firm has arrived at six factors to be considered for final site selection.

• The ratings of each factor on a scale of 1 to 100 provide this information. • Further, based some detailed analysis of both the qualitative and

quantitative data available for each of the location, the rating for the locations against each factor has also been arrived at (on a scale of 0 to 100).

• Using this information obtain a ranking of the alternative locations.

Example

Factors Rating Availability of infrastructure 90 Size of the market 60 Industrial relations climate 50 Tax benefits and concessions 30 Availability of cheap labour 30

Nearness to port 65

Factors Location 1 Location 2 Location 3 Location 4 Location 5 Availability of infrastructure 20 40 60 35 55 Size of the market 30 30 40 60 80 Industrial relations climate 80 30 50 60 50 Tax benefits and concessions 80 20 10 20 20 Availability of cheap labour 70 70 45 50 50

Nearness to port 20 40 90 50 60

Factor Ratings Rating of each locations against the factors

Solution to Example

Factors Rating Relative weights

Availability of infrastructure 90 0.28

Size of the market 60 0.18

Industrial relations climate 50 0.15

Tax benefits and concessions 30 0.09

Availability of cheap labour 30 0.09

Nearness to port 65 0.20

Sum of all factor ratings 325 1.00

FactorsRelative weights Location 1 Location 2 Location 3 Location 4 Location 5

Availability of infrastructure 0.28 20 40 60 35 55Size of the market 0.18 30 30 40 60 80Industrial relations climate 0.15 80 30 50 60 50Tax benefits and concessions 0.09 80 20 10 20 20Availability of cheap labour 0.09 70 70 45 50 50Nearness to port 0.20 20 40 90 50 60

Overall score for the locations 41.23 37.54 54.77 46.46 56.15Ranking of the locations 4 5 2 3 1

Overall rating for location 3 = 60*0.28 + 40*0.18 + 50*0.15 + 10*0.09 + 45*0.09 + 90*0.20 = 54.77

Overall rating for location 5 = 55*0.28 + 80*0.18 + 50*0.15 + 20*0.09 + 50*0.09 + 60*0.20 = 56.15

Plant Location Methodology: Transportation Method of Linear Programming

• Transportation method of linear programming seeks to minimize costs of shipping n units to m destinations or its seeks to maximize profit of shipping n units to m destinations

11-10

Plant Location Methodology: Centroid Method

• The centroid method is used for locating single facilities that considers existing facilities, the distances between them, and the volumes of goods to be shipped between them

• This methodology involves formulas used to compute the coordinates of the two-dimensional point that meets the distance and volume criteria stated above

11-11

Plant Location Methodology: Example of Centroid Method

Question: What is the best location for a new Z-Automobile Warehouse/Temporary storage facility considering only distances and quantities sold per month?

Question: What is the best location for a new Z-Automobile Warehouse/Temporary storage facility considering only distances and quantities sold per month?

• Centroid method example– Several automobile showrooms are located

according to the following grid which represents coordinate locations for each showroom

S ho wro o m No o f Z-Mob ile s s o ld pe r month

A 1250

D 1900

Q 2300X

Y

A(100,200)

D(250,580)

Q(790,900)

(0,0)

11-12

Plant Location Methodology: Centroid Method Formulas

C = d V

V x

ix i

i

Where:Cx = X coordinate of centroidCy = X coordinate of centroiddix = X coordinate of the ith locationdiy = Y coordinate of the ith locationVi = volume of goods moved to or from ith location

C = d V

Vy

iy i

i

11-13

Plant Location Methodology: Example of Centroid Method (Continued): Determining Existing Facility Coordinates

To begin, you must identify the existing facilities on a two-dimensional plane or grid and determine their coordinates.

To begin, you must identify the existing facilities on a two-dimensional plane or grid and determine their coordinates.

X

Y

A(100,200)

D(250,580)

Q(790,900)

(0,0)

You must also have the volume information on the business activity at the existing facilities.

You must also have the volume information on the business activity at the existing facilities.

S ho wro om No o f Z-Mo bile s s o ld pe r mo nth

A 1250

D 1900

Q 2300

11-14

Plant Location Methodology: Example of Centroid Method (Continued): Determining the Coordinates of the New Facility

C = 100(1250) + 250(1900) + 790(2300)

1250 + 1900 + 2300 =

2,417,000

5,450 = x 443.49

C = 200(1250) + 580(1900) + 900(2300)

1250 + 1900 + 2300 =

3,422,000

5,450 = y 627.89

S ho wro o m No o f Z-Mob ile s s o ld pe r month

A 1250

D 1900

Q 2300X

Y

A(100,200)

D(250,580)

Q(790,900)

(0,0)

You then compute the new coordinates using the formulas:You then compute the new coordinates using the formulas:

ZZ

New location of facility Z about (443,627)

New location of facility Z about (443,627)

You then take the coordinates and place them on the map:You then take the coordinates and place them on the map:

11-15

Load Distance Method• Enables a location planner to evaluate two or more

potential candidates for locating a proposed facility vis-à-vis the demand (or supply) points

• Provides an objective measure of total load-distance for each candidate

Example • Coordinates of existing Demand Centers ( A-B-C-D) and corresponding

volume of Demands are given on table on Left• Based on an initial survey of possible sites , the manufacturer identified

four locations for Supply Centers (1-2-3-4) . Coordinates are given on table in right.

• What is the best location for the proposed new facility?

Existing Supply Points Candidates for proposed facility xi yi Wi Xj Yj

A 125 550 200 1 300 500 B 350 400 450 2 200 500 C 450 125 175 3 500 350

D 700 300 150 4 400 200

Multiple Supply & Demand Points Grid Map

100 200 300 400 500 600 700

100

200

300

400

500

600

Distance in Kilometres

Dis

tanc

e in

Kil

omet

res A (125,550), 200

B (350,400), 450

C (450,125), 175

D (700,300), 150

1 (300,500)

2 (200,500) 3 (500,350)

4 (400,200)

Candidate for proposed facility

Existing Demand (or supply) point

Solution to Example

00.182)50(175()500550()300125()()( 222221

211 YyXxD AAA

Dij values

1 2 3 4 A 182.00 90.14 425.00 445.11 B 111.80 180.28 158.11 206.16 C 403.89 450.69 230.49 90.14

D 447.21 538.52 206.16 316.23

LDj values 1 2 3 4

224474.41 258801.57 227410.05 245000.8

LoadWi

150175450200

22 )()( jijiij YyXxD

n

iiijj WDLD

1

*

Multi-facility location problemTransportation Model

• Locating distribution centers for nation-wide distribution of products is one typical example belonging to this category

• Decisions variables in a multiple location – multiple candidate problem– Identifying k out of n candidates for locating facilities– Which of the demand points will be served by each of these locations

and to what extent • the problem is one of managing network flows of satisfying a set

demand points using a combination of supply points• The transportation model is ideally suited for solving this combinatorial

optimisation problem

Multiple facilities location problemTransportation table (Example 7.4.)

Market 1 Market 2 Market 3 Market 4 Market 5 Supply 70 40 10 0 0

Warehouse A 2800 100

2900

0 65 0 95 10 Warehouse B

2000 300 2300

55 0 35 20 0 Warehouse C

400 900 2400 3700

0 20 65 65 50 Warehouse D 1100

1100

Demand 2000 1500 1200 2800 2500 10000

Market 1 Market 2 Market 3 Market 4 Market 5 Supply 100 70 50 30 40

Warehouse A

2900

30 95 40 125 50 Warehouse B

2300

75 20 65 40 30 Warehouse C

3700

20 40 95 85 80 Warehouse D

1100

Demand 2000 1500 1200 2800 2500 10000

Problem

Solution usingVogal’s Approximation

Method (VAM)

Capacity Planning

• Capacity can be defined as the ability to hold, receive, store, or accommodate

• Strategic capacity planning is an approach for determining the overall capacity level of capital intensive resources, including facilities, equipment, and overall labor force size

5-22

Capacity Utilization

• Where• Capacity used

– rate of output actually achieved

• Best operating level– capacity for which the process was designed

level operating Best

usedCapacity rate nutilizatioCapacity

5-23

Best Operating Level

Example: Engineers design engines and assembly lines to operate at an ideal or “best operating level” to maximize output and minimize ware

Example: Engineers design engines and assembly lines to operate at an ideal or “best operating level” to maximize output and minimize ware

Underutilization

Best OperatingLevel

Averageunit costof output

Volume

Overutilization

5-24

Example of Capacity Utilization

• During one week of production, a plant produced 83 units of a product. Its historic highest or best utilization recorded was 120 units per week. What is this plant’s capacity utilization rate?

• During one week of production, a plant produced 83 units of a product. Its historic highest or best utilization recorded was 120 units per week. What is this plant’s capacity utilization rate?

· Answer: Capacity utilization rate = Capacity used

Best operating level = 83/120 =0.69 or 69%

· Answer: Capacity utilization rate = Capacity used

Best operating level = 83/120 =0.69 or 69%

5-25

Economies & Diseconomies of Scale

100-unitplant

200-unitplant 300-unit

plant

400-unitplant

Volume

Averageunit costof output

Economies of Scale and the Learning Curve workingEconomies of Scale and the Learning Curve working

Diseconomies of Scale start workingDiseconomies of Scale start working

5-26

Capacity Flexibility

• Flexible plants

• Flexible processes

• Flexible workers

5-27

Strategies For Capacity Augmentation

• Add New Capacity

• Debottleneck existing Capacity

• Locate External Sources of Capacity

5-28

Example of a Decision Tree Problem

A glass factory specializing in crystal is experiencing a substantial backlog, and the firm's management is considering three courses of action:

A) Arrange for subcontractingB) Construct new facilitiesC) Do nothing (no change)

The correct choice depends largely upon demand, which may be low, medium, or high. By consensus, management estimates the respective demand probabilities as 0.1, 0.5, and 0.4.

A glass factory specializing in crystal is experiencing a substantial backlog, and the firm's management is considering three courses of action:

A) Arrange for subcontractingB) Construct new facilitiesC) Do nothing (no change)

The correct choice depends largely upon demand, which may be low, medium, or high. By consensus, management estimates the respective demand probabilities as 0.1, 0.5, and 0.4.

5-29

Example of a Decision Tree Problem (Continued): Step 1. We start by drawing the three decisions

A

B

C

5-30

Example of a Decision Tree Problem (Continued): The Payoff Table

0.1 0.5 0.4Low Medium High

A 10 50 90B -120 25 200C 20 40 60

The management also estimates the profits when choosing from the three alternatives (A, B, and C) under the differing probable levels of demand. These profits, in thousands of dollars are presented in the table below:

The management also estimates the profits when choosing from the three alternatives (A, B, and C) under the differing probable levels of demand. These profits, in thousands of dollars are presented in the table below:

5-31

Example of Decision Tree Problem (Continued): Step 2. Add our possible states of nature, probabilities, and payoffs

A

B

C

High demand (0.4)

Medium demand (0.5)

Low demand (0.1)

$90k$50k

$10k

High demand (0.4)

Medium demand (0.5)

Low demand (0.1)

$200k$25k

-$120k

High demand (0.4)

Medium demand (0.5)

Low demand (0.1)

$60k$40k

$20k

5-32

Example of Decision Tree Problem (Continued): Step 3. Determine the expected value of each decision

High demand (0.4)High demand (0.4)

Medium demand (0.5)Medium demand (0.5)

Low demand (0.1)Low demand (0.1)

AA

$90k$90k

$50k$50k

$10k$10k

EVA=0.4(90)+0.5(50)+0.1(10)=$62kEVA=0.4(90)+0.5(50)+0.1(10)=$62k

$62k$62k

5-33

Example of Decision Tree Problem (Continued): Step 4. Make decision

High demand (0.4)

Medium demand (0.5)

Low demand (0.1)

High demand (0.4)

Medium demand (0.5)

Low demand (0.1)

A

B

CHigh demand (0.4)

Medium demand (0.5)

Low demand (0.1)

$90k$50k

$10k

$200k$25k

-$120k

$60k$40k

$20k

$62k

$80.5k

$46k

Alternative B generates the greatest expected profit, so our choice is B or to construct a new facility

Alternative B generates the greatest expected profit, so our choice is B or to construct a new facility

5-34

Facility Layout

Facility Layout means planning for: • Location of machines • Workstations• Utilities• Restrooms• Offices• Warehouses

Facility Layout Planning

• Criteria for Manufacturing operations layout: Flexibility for Products’ volume Products variety & future expansion Eliminating unproductive materials-handling Ease for Plant Operations & Maintenance Safety, Health & Environment considerations Fulfillment of Other Statutory requirements

Layout Planning for Service operations

• Criteria for layout design: Customer comfort & convenience Aesthetics & Appeal value Attractive display of merchandise Classification & Clustering Stock Rotation for shelf life Adequate passage for movement Unobstructed visual communication

Layout Planning for Warehouse operations

• Criteria for layout design: Place for Loading & Unloading operations Storage according to Classification Codes Consideration for physical size, shape and weight of materials under storage Consideration for shelf life & preservation Adequate passage for materials movement Centralized workstation for warehouse keeper

Layout Planning for Office operations

• Criteria layout design: Inline with existing organization structure Aesthetics & Appeal value Elimination of unproductive movement of

personnel including visitors Privacy of workstations, records & documents Reception, Meeting Place & Pantry

Facility Layout Planning

• Criteria for Office operations layout: Inline with existing organization structure Aesthetics & Appeal value Elimination of unproductive movement of

personnel including visitors Privacy of workstations, records & documents Reception, Meeting Place & Pantry

Load-Distance Analysis in Process Layouts

• Load means number of operations carried out at the work station.

• Sequence of Processing means pre-designed process flow for carrying out operations

• Distance refers to physical distance of movement from one work station to another in the process chain

• Load – Distance means the quantum of work associated with each sequential operation carried out on the load

In short Load X Distance = Load Distance

Sequential Distance Calculation

1 2 5

3 4 6

7 8 9

X 4-6-3-7-8-9

10+10+10+10+10+10= 60

Y 5-2-1-7-9

10+10+10+10+10+10= 60

Z 3-4-7-8-9

10+10+10+10+10= 50

Layout Option A Product Sequence SequentialDistance


5 3 4

9 6 1

2 7 8

X 4-6-3-7-8-9

10+10+10+10+10+10+10+10+10= 90

Y 5-2-1-7-9

10+10+10+10+10+10+10+10+10=90

Z 3-4-7-8-9

10+10+10+10+10+10+10+10= 80

Layout Option B Product Sequence SequentialDistance

Load-Distance Calculation

X 4-6-3-7-8-9

10+10+10+10+10+10= 60

Y 5-2-1-7-9

10+10+10+10+10+10=60

Z 3-4-7-8-9

10+10+10+10+10= 50

Layout Option A Product Load LoadDistance

X 1000 1000 X 60=60,000

Y 3000 3000 X 60=180,000

Z 1000 1000 X 5050,000

Total Load Distance =290,000

Load-Distance Calculation

X 4-6-3-7-8-9

10+10+10+10+10+10+10+10+10= 90

Y 5-2-1-7-9

10+10+10+10+10+10+10+10+10=90

Z 3-4-7-8-9

10+10+10+10+10+10+10+10= 80

Layout Option B Product Load Load Distance

X 1000 1000 x 90= 90,000

Y 3000 3000 X 90=270,000

Z 1000 1000 X 8080,000

Total Load Distance =440,000


1 2 5

3 4 6

7 8 9

5 3 4

9 6 1

2 7 8

Layout Option A Layout Option B

Load Distance: 290,000 Load Distance: 440,000

Closeness Rating

• Closeness Rating Technique is an effective tool in Service Layout Planning

• Layout of work stations is designed on the basis of desirable Closeness ( Nearness ) of a set of functions associated with the operation.

• Closeness is prioritized or rated according to the necessity & importance as follows:

Closeness Rating

Importance

1 Absolutely Necessary

2. Highly Important

3. Important

4. Slightly Important

5. Unimportant

6. Undesirable

4

1

2

5

63

4

3

1

5

4

1

3

6

5

5

2

5

5

4

6

4

3

4

5

4

5

4

4

1

5

16

42

56

D1

D2

D3

D4

D5

D6

D7

D8

D9

Closeness Logic

Rating 1: Most Important• D1 = D9• D9 = D8• D8 = D4• D4 = D3• D4 = D1

Rating 2: Important• D1 – D2• D5 – D7• D7- D9

Rating 6: Least Important• D2 # D3• D2 # D8• D5 # D6• D4 # D9

Rating5: Unimportant• D6 / D7• D2 / D4• D6 / D8• D4 / D7• D3 / D7• D2 / D7• D1 / D8

Proposed Layout

D3

D7

D4 D8

D9

D6

D1

D2D5

Closeness Rating

• Closeness Rating Technique is an effective tool in Service Layout Planning

• Layout of work stations is designed on the basis of desirable Closeness ( Nearness ) of a set of functions associated with the operation.

• Closeness is prioritized or rated according to the necessity & importance as follows:

Closeness Rating

Importance

1 Absolutely Necessary

2. Highly Important

3. Important

4. Slightly Important

5. Unimportant

6. Undesirable

for Office operations

Layout of a Hospital

D3

D7

D4 D8

D9

D6

D1

D2D5

Emergency

Lab

Pharmacy

X-Ray

IndoorBilling

OPD

OT

Admin

Closeness Logic

Rating 1: Most Important• D1 = D9• D9 = D8• D8 = D4• D4 = D3• D4 = D1

Rating 2: Important• D1 – D2• D5 – D7• D7- D9

Rating 6: Least Important• D2 # D3• D2 # D8• D5 # D6• D4 # D9

Rating5: Unimportant• D6 / D7• D2 / D4• D6 / D8• D4 / D7• D3 / D7• D2 / D7• D1 / D8

4

1

2

5

63

4

3

1

5

4

1

3

6

5

5

2

5

5

4

6

4

3

4

5

4

5

4

4

1

5

16

42

56

D1

D2

D3

D4

D5

D6

D7

D8

D9

Proposed Layout

D3

D7

D4 D8

D9

D6

D1

D2D5

Facility Layout Defined

Facility layout can be defined as the process by which the placement of departments, workgroups within departments, workstations, machines, and stock-holding points within a facility are determined

This process requires the following inputs:– Specification of objectives of the system in terms of output and

flexibility– Estimation of product or service demand on the system– Processing requirements in terms of number of operations and

amount of flow between departments and work centers– Space requirements for the elements in the layout– Space availability within the facility itself

7A-56

Basic Production Layout Formats

• Workcenter (also called job-shop or functional layout)

• Assembly Line (also called flow-shop layout)

• Manufacturing cell Layout

• Project Layout

7A-57

Process Layout: Interdepartmental Flow

• Given– The flow (number of moves) to and from all

departments– The cost of moving from one department to

another– The existing or planned physical layout of the

plant• Determine

– The “best” locations for each department, where best means maximizing flow, which minimizing costs

7A-58

Process Layout: Systematic Layout Planning

• Numerical flow of items between workcenters – Can be impractical to obtain– Does not account for the qualitative factors that

may be crucial to the placement decision• Systematic Layout Planning

– Accounts for the importance of having each department located next to every other department

– Is also guided by trial and error• Switching workcenters then checking the results of the

“closeness” score

7A-59

Example of Systematic Layout Planning: Reasons for Closeness

Code

1

2

3

4

5

6

Reason

Type of customer

Ease of supervision

Common personnel

Contact necessary

Share same price

Psychology

7A-60

Example of Systematic Layout Planning:Importance of Closeness

Value

A

E

I

O

U

X

Closeness Linecode

Numericalweights

Absolutely necessary

Especially important

Important

Ordinary closeness OK

Unimportant

Undesirable

16

8

4

2

0

80

7A-61

Example of Systematic Layout Planning: Relating Reasons and Importance

From

1. Credit department

2. Toy department

3. Wine department

4. Camera department

5. Candy department

6

I

--

U

4

A

--

U

--

U

1

I

1,6

A

--

U

1

X

1

X

To2 3 4 5

Area(sq. ft.)

100

400

300

100

100

Closeness rating

Reason for rating

Note here that the (1) Credit Dept. and (2) Toy Dept. are given a high rating of 6.

Note here that the (1) Credit Dept. and (2) Toy Dept. are given a high rating of 6.Letter

Number

Note here that the (2) Toy Dept. and the (5) Candy Dept. are given a high rating of 6.

Note here that the (2) Toy Dept. and the (5) Candy Dept. are given a high rating of 6.

7A-62

Example of Systematic Layout Planning:Initial Relationship Diagram

1

2

4

3

5

U U

E

A

I

The number of lines here represent paths required to be taken in transactions between the departments. The more lines, the more the interaction between departments.

The number of lines here represent paths required to be taken in transactions between the departments. The more lines, the more the interaction between departments.

Note here again, Depts. (1) and (2) are linked together, and Depts. (2) and (5) are linked together by multiple lines or required transactions.

Note here again, Depts. (1) and (2) are linked together, and Depts. (2) and (5) are linked together by multiple lines or required transactions.

7A-63

Example of Systematic Layout Planning:Initial and Final Layouts

1

2 4

3

5

Initial Layout

Ignoring space andbuilding constraints

2

5 1 43

50 ft

20 ft

Final Layout

Adjusted by squarefootage and buildingsize

Note in the Final Layout that Depts. (1) and (5) are not both placed directly next to Dept. (2).

Note in the Final Layout that Depts. (1) and (5) are not both placed directly next to Dept. (2).

7A-64

Station 1

Minutes per Unit 6

Station 2

7

Station 3

3

Assembly Lines Balancing Concepts

Question: Suppose you load work into the three work stations below such that each will take the corresponding number of minutes as shown. What is the cycle time of this line?

Question: Suppose you load work into the three work stations below such that each will take the corresponding number of minutes as shown. What is the cycle time of this line?

Answer: The cycle time of the line is always determined by the work station taking the longest time. In this problem, the cycle time of the line is 7 minutes. There is also going to be idle time at the other two work stations.

Answer: The cycle time of the line is always determined by the work station taking the longest time. In this problem, the cycle time of the line is 7 minutes. There is also going to be idle time at the other two work stations.

7A-65

Example of Line Balancing

• You’ve just been assigned the job a setting up an electric fan assembly line with the following tasks:

Task Time (Mins) Description PredecessorsA 2 Assemble frame NoneB 1 Mount switch AC 3.25 Assemble motor housing NoneD 1.2 Mount motor housing in frame A, CE 0.5 Attach blade DF 1 Assemble and attach safety grill EG 1 Attach cord BH 1.4 Test F, G

7A-66

Example of Line Balancing: Structuring the Precedence Diagram

Task PredecessorsA None

A

B A

B

C None

C

D A, C

D

Task PredecessorsE D

E

F E

F

G B

G

H E, G

H

7A-67

Example of Line Balancing: Precedence Diagram

A

C

B

D E F

GH

2

3.25

1

1.2 .5

11.4

1

Question: Which process step defines the maximum rate of production?

Question: Which process step defines the maximum rate of production?

Answer: Task C is the cycle time of the line and therefore, the maximum rate of production.

Answer: Task C is the cycle time of the line and therefore, the maximum rate of production.

7A-68

Example of Line Balancing: Determine Cycle Time

Required Cycle Time, C = Production time per period

Required output per period

C = 420 mins / day

100 units / day= 4.2 mins / unit

Question: Suppose we want to assemble 100 fans per day. What would our cycle time have to be?

Question: Suppose we want to assemble 100 fans per day. What would our cycle time have to be?

Answer: Answer:

7A-70

Example of Line Balancing: Determine Theoretical Minimum Number of Workstations

Question: What is the theoretical minimum number of workstations for this problem?

Question: What is the theoretical minimum number of workstations for this problem?

Answer: Answer: Theoretical Min. Number of Workstations, N

N = Sum of task times (T)

Cycle time (C)

t

t

N = 11.35 mins / unit

4.2 mins / unit= 2.702, or 3t

7A-71

Example of Line Balancing: Rules To Follow for Loading Workstations

• Assign tasks to station 1, then 2, etc. in sequence. Keep assigning to a workstation ensuring that precedence is maintained and total work is less than or equal to the cycle time. Use the following rules to select tasks for assignment.

• Primary: Assign tasks in order of the largest number of following tasks

• Secondary (tie-breaking): Assign tasks in order of the longest operating time

7A-72

A

C

B

D E F

GH

2

3.25

1

1.2 .5

11.4

1

Station 1 Station 2 Station 3

Task Followers Time (Mins)A 6 2C 4 3.25D 3 1.2B 2 1E 2 0.5F 1 1G 1 1H 0 1.4

7A-73

A

C

B

D E F

GH

2

3.25

1

1.2 .5

11.4

1


A (4.2-2=2.2)


7A-74

A

C

B

D E F

GH

2

3.25

1

1.2 .5

11.4

1

A (4.2-2=2.2)B (2.2-1=1.2)



7A-75

A

C

B

D E F

GH

2

3.25

1

1.2 .5

11.4

1

A (4.2-2=2.2)B (2.2-1=1.2)G (1.2-1= .2)

Idle= .2



7A-76

A

C

B

D E F

GH

2

3.25

1

1.2 .5

11.4

1

C (4.2-3.25)=.95


A (4.2-2=2.2)B (2.2-1=1.2)G (1.2-1= .2)

Idle= .2


7A-77

C (4.2-3.25)=.95

Idle = .95

A

C

B

D E F

GH

2

3.25

1

1.2 .5

11.4

1


A (4.2-2=2.2)B (2.2-1=1.2)G (1.2-1= .2)

Idle= .2


7A-78

C (4.2-3.25)=.95

Idle = .95

A

C

B

D E F

GH

2

3.25

1

1.2 .5

11.4

1

D (4.2-1.2)=3


A (4.2-2=2.2)B (2.2-1=1.2)G (1.2-1= .2)

Idle= .2


7A-79

A

C

B

D E F

GH

2

3.25

1

1.2 .5

11.4

1

C (4.2-3.25)=.95

Idle = .95

D (4.2-1.2)=3E (3-.5)=2.5


A (4.2-2=2.2)B (2.2-1=1.2)G (1.2-1= .2)

Idle= .2


7A-80

A

C

B

D E F

GH

2

3.25

1

1.2 .5

11.4

1

C (4.2-3.25)=.95

Idle = .95

D (4.2-1.2)=3E (3-.5)=2.5F (2.5-1)=1.5


A (4.2-2=2.2)B (2.2-1=1.2)G (1.2-1= .2)

Idle= .2


7A-81

A

C

B

D E F

GH

2

3.25

1

1.2 .5

11.4

1

C (4.2-3.25)=.95

Idle = .95

D (4.2-1.2)=3E (3-.5)=2.5F (2.5-1)=1.5H (1.5-1.4)=.1Idle = .1


A (4.2-2=2.2)B (2.2-1=1.2)G (1.2-1= .2)

Idle= .2


Which station is the bottleneck? What is the effective cycle time?

7A-82

Example of Line Balancing: Determine the Efficiency of the Assembly Line

Efficiency =Sum of task times (T)

Actual number of workstations (Na) x Cycle time (C)

Efficiency =11.35 mins / unit

(3)(4.2mins / unit)=.901

7A-83

Manufacturing Cell:Benefits

1. Better human relations

2. Improved operator expertise

3. Less in-process inventory and material handling

4. Faster production setup

7A-84

Manufacturing Cell:Transition from Process Layout

1. Grouping parts into families that follow a common sequence of steps

2. Identifying dominant flow patterns of parts families as a basis for location or relocation of processes

3. Physically grouping machines and processes into cells

7A-85

Project Layout

Question: What are our primary considerations for a project layout? Question: What are our primary considerations for a project layout?

Answer: Arranging materials and equipment concentrically around the production point in their order of use.

Answer: Arranging materials and equipment concentrically around the production point in their order of use.

7A-86

Retail Service Layout

• Goal--maximize net profit per square foot of floor space

• Servicescapes– Ambient Conditions– Spatial Layout and Functionality– Signs, Symbols, and Artifacts

7A-87

Documents

Location Planning Capacity Planning and Layout Planning Module IV