2. strategic facilities planning

Strategic facilities planning


The science and art of employing the resources of a firm

to achieve its business objectives

Goals Vision Mission Long Term Objectives Strategies Annual objectives Policies Procedures Action plan


How activities tangible of fixed assets best support achieving the activities objectives.

The more aggregate a facilities planning mistake, the more costly it will be, the less likely it will be changed, and the longer it will affect the operations by Hicks

Every element of the organization must support the objectives of the firm.

Developing FP strategies:

Team-based approach

Multidimensional Aspects

Impact of changes (Flexibility)

Not driven by profit only

What if Question (uncertainty envelop)

Functional strategies

Strategic Facilities Planning

Characteristics

Long time horizon

Less certainty

Less structured

More end oriented

Poorly defined information

Trends to have irreversible impact

Focus on the whole

As noted by skinner When companies fail to recognize the relationship between manufacturing decisions and corporate strategy, they may become saddled with seriously noncompetitive production systems that are expensive and time-consuming to change.


Feasibility analysis

Lease versus own analysis

Buy/build/expand/renovate analysis

Merger/acquisition facility study

Analysis of highest and best use

Consolidation study

Decentralization study

Space optimization plan (restacking plan)

Project estimating and scheduling

Stay/move analysis

Developing facilities planning strategies

Facilities Planning Improvement


Dwight D. Eisenhower said, The plan in nothing, but planning is everything.

Skinner, Manufacturing affects corporate strategy, and corporate strategy affects manufacturing. Even an

apparently routine operating area such as a production

scheduling system, strategic considerations should

outweigh technical and conventional industrial engineering

factors invoked in the name of productivity.

Developing Facilities Planning Strategies

The process of effectively translating objectives into actions

can take place only if the power of the individuals inside a

organization is unleashed.

It is important to recognize that each functional strategy is

multidimensional

The Model of Success is effective because it is lateral

approach rather than a hierarchical one.


A number of internal functional areas tend to have a

significant impact on Facilities planning, including

marketing, product development, manufacturing,

production and inventory control, human resources,

and finance. Marketing decisions affect the location of

facilities and the handling system design


Product development & design decisions affect

processing & materials requirements, which in turn

affect layout & material handling.

Changes in component shapes, product complexity,

number of new part numbers, sizes introduced,

stability of product design, and the number of products

introduced affect the handling, storage, and control of

materials


Decisions concerning the degree of vertical integration,

types and levels of automation, types and levels of

control over tooling and work-in process, plant sizes,

and general-purpose versus special-purpose

equipment can affect the location and design of

manufacturing and support facilities.


Close coordination is required in developing facilities

plans to support manufacturing and distribution.

Manufacturing/facilities planning and

distribution/facilities planning interfaces are especially

important.


As the manufacturing plan addresses automatic

load/unload of machines, robotics, group technology,

transfer lines, flexible manufacturing systems, numerically

controlled machines, just-in-time and computer-integrated

manufacturing, alternative storage systems for tooling and

work-in-process, real-time inventory control, shop floor

control, and waste handling/removal systems, the facilities

plan must support changes in manufacturing technology

Developing Facilities Planning Strategies Long Range

1. Number, location, and sizes of warehouses and/or distribution centers

2. Centralized versus decentralized storage of supplies, raw materials, work-in-process, and finished goods for single and multi-building sites, as well as single and multisite companies

3. Acquisition of existing facilities versus design of modern factories and distribution centers of the future


4. Flexibility required because of market and

technological uncertainties

5. Interface between storage & manufacturing

6. Level of vertical integration, including "subcontract

versus manufacture' decisions


7. Control systems, including material control and

equipment control, as well as level of distributed

processing

8. Movement of material between buildings and between

sites, both inbound and outbound


9. Changes in customers and suppliers' technology as

well as a firm's own manufacturing technology and

material movement, protection, storage, and control

technology

10. Design-to-cost goals for facilities

Examples of Inadequate Planning

A textile firm installed a large high-rise AS/RS for one

of its divisions. The amount and size of the product to

be stored subsequently changed. Other changes in

technology were projected. The system became

obsolete before it was operational.


A manufacturer of automotive equipment acquired the

land for a new manufacturing plant. The manufacturing

team designed the layout, and the architect began

designing the facility before the movement, protection,

storage, and control system was designed.


An established brick-and-mortar retailer began

accepting orders through its Web site. The volume of

orders received during the holiday season peak could

not be processed by its distribution center.

Summary

Determines how an activity's tangible fixed assets

should contribute to meeting the activity's objectives

Consists of facilities location and facilities design is

part art and part science

Can be approached using the engineering design

process

Summary

Is a continuous process and should be viewed from a

life-cycle perspective

Represents one of the most significant opportunities

for cost reduction and productivity improvement

2. strategic facilities planning

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