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Process Selection and Facility Layout
Chapter 6
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Learning Objective
• Compare the four basic processing types• Describe product layouts and their main
advantages and disadvantages• Describe process layouts and their main
advantages and disadvantages• Develop simple product layouts• Develop simple process layouts
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Process Selection
• 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
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Process Selection and System Design
Forecasting (demand)
Product andService Design
TechnologicalChange
CapacityPlanning
ProcessSelection
Facilities andEquipment
Layout
WorkDesign
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Process Selection
Process choice is demand driven:1. Variety
– How much?
2. Volume– Expected output?
3. Standardization4. Equipment flexibility
– To what degree?
Process Types• Job shop
– Small scale/high variety– e.g., doctor, tailor
• Batch– Moderate volume/moderate variety– e.g., bakery
• Repetitive/assembly line– High volumes of standardized goods or
services– e.g., automobiles
• Continuous– Very high volumes of non-discrete
goods– e.g., petroleum products
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Types of Processing
Job Shop BatchRepetitive/Assembly Continuous
Description Customizedgoods orservices
Semi-standardizedgoods or services
Standardizedgoods orservices
Highly standardized
goods or services
Advantages Able to handle a wide variety of work
Flexibility; easy to add or change products or services
Low unit cost, high volume, efficient
Very efficient, very high volume
Disadvantages Slow, high costper unit,complexplanning andscheduling
Moderate costper unit,moderateschedulingcomplexity
Low flexibility,high cost of downtime
Very rigid, lack of variety, costly to change, very high cost of downtime
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Product-Process Matrix
6-7
Volume
Flexibility/Variety
• The diagonal represents the “ideal” match• Hybrid process are possible (e.g., job-shop & batch)
• Process choice may change as products goes through its life-cycles
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Process Choice EffectsActivity/Function Projects Job Shop Batch Repetitive ContinuousCost estimation Simple to
complexDifficult Somewhat routine Routine Routine
Cost per unit Very high High Moderate Low Low
Equipment used Varied General purpose General purpose Special purpose Special purpose
Fixed costs Varied Low Moderate High Very high
Variable costs High High Moderate Low Very low
Labor skills Low to high High Moderate Low Low to high
Marketing Promotecapabilities
Promotecapabilities
Promotecapabilities; semi-standardized goods and services
Promotestandardized goods/services
Promotestandardized goods/services
Scheduling Complex, subjectto change
Complex Moderately complex
Routine Routine
6-8
• Project– used for work that is nonroutine with a unique set of objective to be accomplished in a
limited time frame.– E.g., plays, movies, launching a new products, publishing a book, building a dam, building a bridge
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Product and Service Profiling
• Product or service profiling– Linking key product or service requirements to
process capabilities
– Key dimensions relate to• Range of products or services that can be processed• Expected order sizes• Expected frequency of schedule changes
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Technology
• Automation– Fixed automation– Programmable automation
• Computer-aided manufacturing• Numerically Controlled machines
– Flexible automation• Flexible manufacturing systems (FMS): A group of machines designed to
handle intermittent processing requirements and produce a variety of similar products
• Computer-integrated manufacturing (CIM)– A system for linking a broad range of manufacturing activities
through an integrating computer system
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New Process TrendHBR 12/6/12 Three Examples of New Process Strategy
There are three fundamental ways that companies can improve their processes in the coming decade:
1. expand the scope of work managed by a company to include customers, suppliers, and partners; – Shift to global, virtual, cross-organizational teams of specialized entities that are knitted
together to serve customers– To keep such a multiparty system from degenerating into chaos, virtual process teams
must have aligned goals and support systems.
2. target the increasing amount of knowledge work; and – Big data analytics– Crowdsourcing, e.g., mechanical turk, innocentive.com, TopCoder.com &
Heritage Health Prize» HBR : Using the Crowd as an Innovation Partner
3. reduce cycle times to durations previously considered impossible– Agile processes– Managers must speed the flow of information so that decisions can be made faster at all
levels, from top to bottom.
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Facilities Layout
• Layout– The configuration of departments, work centers, and
equipment, with particular emphasis on movement of work (customers or materials) through the system
– Facilities layout decisions arise when:• Designing new facilities• Re-designing existing facilities
– The basic objective of layout design is to facilitate a smooth flow of work, material, and information through the system.
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Basic Layout Types• Product layout
– Layout that uses standardized processing operations to achieve smooth, rapid, high-volume flow.
– The work is divided into a series of standardized tasks, permitting specialization of equipment and division of labor.
• Process layout– Layout that can handle varied processing requirements– The variety of jobs that are processed requires frequent adjustments to
equipment
• Fixed position layout– Layout in which the product or project remains stationary, and workers,
materials, and equipment are moved as needed
• Combination layouts
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Product Layouts
• Product layout – Layout that uses standardized processing operations to achieve
smooth, rapid, high-volume flow– E.g., production line or assembly line– How?
Used for Repetitive ProcessingRepetitive or Continuous
Raw materialsor customer
Finished item
Station 2
Station 3
Station 4
Material and/or labor
Material and/or labor
Material and/or labor
Material and/or labor
Station 1
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Product Layouts
• Although product layouts often follow a straight line, a straight line is not always the best, and layouts may take an L, O, S, or U shape. Why?
– L:– O:– S:– U: more compact, increased communication facilitating team work,
minimize the material handling
Image source: mdcegypt.com
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Product Layouts
Advantages• High rate of output• Low unit cost• Labor specialization• Low material handling cost per
unit• High utilization of labor and
equipment• Established routing and
scheduling• Routine accounting, purchasing,
and inventory control
DisadvantagesCreates dull, repetitive jobsPoorly skilled workers may not
maintain equipment or quality of output
Fairly inflexible to changes in volume or product or process design
Highly susceptible to shutdownsPreventive maintenance, capacity for
quick repair and spare-parts inventories are necessary expenses
Individual incentive plans are impractical
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Non-repetitive Processing: Process Layouts
• Process layouts– Layouts that can handle varied processing requirements– E.g., machine shop: milling, grinding, drilling, etc.
Used for Intermittent processingJob Shop or Batch
Dept. A
Dept. B Dept. D
Dept. C
Dept. F
Dept. E
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Process Layouts
Advantages• Can handle a variety of
processing requirements• Not particularly vulnerable
to equipment failures• General-purpose equipment
is often less costly and easier and less costly to maintain
• It is possible to use individual incentive systems
Disadvantages• In-process inventories can be high• Routing and scheduling pose
continual challenges• Equipment utilization rates are low• Material handling is slow and less
efficient• Complicates supervision• Special attention necessary for each
product or customer• Accounting, inventory control, and
purchasing are more complex
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Fixed Position Layouts
• Fixed Position Layout– Layout in which the product or project remains
stationary, and workers, materials, and equipment are moved as needed
– E.g., farming, firefighting, road building, home building, remodeling and repair, and drilling for oil
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Combination Layouts
• Some operational environments use a combination of the three basic layout types:– Hospitals– Supermarket– Shipyards
• Some organizations are moving away from process layouts in an effort to capture the benefits of product layouts
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Line BalancingLine balancing
The process of assigning tasks to workstations in such a way that the workstations have approximately equal time requirements
Goal:Obtain task grouping that represent approximately equal time requirements
since this minimizes idle time along the line and results in a high utilization of equipment and labor
Why is line balancing important?1. It allows us to use labor and equipment more efficiently.2. To avoid fairness issues that arise when one workstation must work harder than another.
– Input• Tasks sequencing (precedence diagram)• Tasks time• Operating time
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Precedence Diagram• Precedence diagram
– A diagram that shows elemental tasks and their precedence requirements
Task Duration (min)
Immediate predecessor
a Select material 0.1 -
b Make petals 1.0 a
c Select rhinestones
0.7 -
d Glue rhinestones
0.5 b, c
e Package 0.2 d
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Cycle Time
• Cycle time– The maximum time allowed at each workstation to
complete its set of tasks on a unit (depending on the number of workstations)
• Minimum Cycle Time = longest task time = 1.0 min• Maximum Cycle time = Σt = sum of task time = 2.5 min
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Output rate of a line
• Cycle time also establishes the output rate of a line
• The cycle time is generally determined by the desired output.
Cycle time = Operating time per day
Desired output rate
Output rate = Operating time per day
Cycle time
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How Many Workstations are Needed?
• The required number of workstations is a function of:– Desired output rate– The ability to combine tasks into a workstation
• (theoretical) Minimum number of stations
Nmin= ∑ t
Cycle time
where
Nmin = theoretical minimum number of stations
∑ t = sum of task times
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How Many Workstations are Needed?
• The required number of workstations is a function of:– Desired output rate– The ability to combine tasks into a workstation
• (theoretical) Minimum number of stations
Nmin= ∑ t
Cycle time
where
Nmin = theoretical minimum number of stations
∑ t = sum of task times
Q: Why this is a theoretical value?A: There are often scraps or idle times.
Example: 4 tasks, each require 6 hours to finishA station can handle 8 hours amount of tasks a day.You will need 4 stations to complete all tasks, instead of 3.Nmin = (6+6+6+6) / 8 = 3
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Designing Product Layouts
Some Heuristic (Intuitive, may not result in optimal solution) Rules:Assign tasks in order of most following tasks
Count the number of tasks that follow
Assign tasks in order of greatest positional weight. Positional weight is the sum of each task’s time and the times of all
following tasks.
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Example: Assembly Line Balancing
• Arrange tasks (shown in the figure) into three workstations– Assume the cycle time of each workstation is 1.2 min.– Assign tasks in order of the most number of followers– Break tie using greatest positional weight
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• Assign tasks in order of the most number of followers
WorkstationTimeRemaining Eligible
AssignTask
RevisedTime Remaining
StationIdle Time
1 1.2 a, c
2
3
Start with CT (1.2 min. in this example)
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• Assign tasks in order of the most number of followers
WorkstationTimeRemaining Eligible
AssignTask
RevisedTime Remaining
StationIdle Time
1 1.2 a, c a 1.1
2
3
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WorkstationTimeRemaining Eligible
AssignTask
RevisedTime Remaining
StationIdle Time
1 1.21.1
a, cc, b
a 1.1
2
3
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WorkstationTimeRemaining Eligible
AssignTask
RevisedTime Remaining
StationIdle Time
1 1.21.1
a, cc, b
ab
1.10.1
2
3
Break tie using greatest positional weight
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WorkstationTimeRemaining Eligible
AssignTask
RevisedTime Remaining
StationIdle Time
1 1.21.10.1
a, cc, bc
ab
1.10.1
2
3
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WorkstationTimeRemaining Eligible
AssignTask
RevisedTime Remaining
StationIdle Time
1 1.21.10.1
a, cc, bc
ab-
1.10.1
0.1
2
3
Can’t assign c to this workstation because the workstation doesn’t have enough time (0.1) to complete c (0.7).
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Start with CT (1.2 min. in this example)
WorkstationTimeRemaining Eligible
AssignTask
RevisedTime Remaining
StationIdle Time
1 1.21.10.1
a, cc, bc
ab-
1.10.1
0.1
2 1.2 c c 0.5
3
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WorkstationTimeRemaining Eligible
AssignTask
RevisedTime Remaining
StationIdle Time
1 1.21.10.1
a, cc, bc
ab-
1.10.1
0.1
2 1.20.5
cd
cd
0.50 0
3
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Start with CT (1.2 min. in this example)
WorkstationTimeRemaining Eligible
AssignTask
RevisedTime Remaining
StationIdle Time
1 1.21.10.1
a, cc, bc
ab-
1.10.1
0.1
2 1.20.5
cd
cd
0.50 0.0
3 1.2 e e 11.0
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WorkstationTimeRemaining Eligible
AssignTask
RevisedTime Remaining
StationIdle Time
1 1.21.10.1
a, cc, bc
ab-
1.10.1
0.1
2 1.20.5
cd
cd
0.50 0.0
3 1.2 e e 11.0
Idle time per cycle=0.1+0.0+1.0=1.1
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Layout
a & b(0.1+1.0)
c & d(0.7+0.5)
e(0.2)
Task Duration (min)
Immediate predecessor
a Select material 0.1 -
b Make petals 1.0 a
c Select rhinestones
0.7 -
d Glue rhinestones
0.5 b, c
e Package 0.2 d
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• Balance delay (percentage of idle time)– Percentage of idle time of a line
• Efficiency– Percentage of busy time of a line
Balance Delay = Idle time per cycle
× 100%Nactual × Cycle time
where
Nactual = actual number of stations
Efficiency = 100% − Balance Delay
Measuring Effectiveness
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Example:Measuring Effectiveness
WorkstationTimeRemaining Eligible
AssignTask
RevisedTime Remaining
StationIdle Time
1 1.21.10.1
a, cc, bc
ab-
1.10.1
0.1
2 1.20.5
cd
cd
0.50 0.0
3 1.2 e e 1.01.0
Efficiency = 100% – 30.55% = 69.45%
Percentage of idle time = [(0.1 + 0 + 1.0) ÷ (3 × 1.2)] × 100% = 30.55%
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(Textbook page 267) Using the information contained in the table shown, do each of the following:
1. Draw a precedence diagram.2. Assuming an eight-hour workday,
compute the cycle time needed to obtain an output of 400 units per day.
3. Determine the minimum number of workstations required.
4. Assign tasks to workstations using this rule: Assign tasks according to greatest number of following tasks. In case of a tie, use the tiebreaker of assigning the task with the longest processing time first.
5. Compute the resulting percent idle time and efficiency of the system
Exercise
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1. Draw a precedence diagram
Solution
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2. Assuming an eight-hour workday, compute the cycle time needed to obtain an output of 400 units per day
Cycle time =
Operating time per day
=
480 minutes per day
= 1.2 minutes per cycleDesired output
rate400 units per
day
Example:Measuring Effectiveness
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3. Determine the minimum number of workstations required
Nmin= ∑ t
=
Cycle time
where
Nmin = theoretical minimum number of stations
∑ t = sum of task times
= 3.17 stations ( round to 4)
3.8 minutes per unit
1.2 minutes per cycle time per station
Example:Measuring Effectiveness
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4. Assign tasks to workstations using this rule: Assign tasks according to greatest number of following tasks. In case of a tie, use the tiebreaker of assigning the task with the longest processing time first.
Example:Measuring Effectiveness
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5. Compute the resulting percent idle time and efficiency of the system
Percent idle time = Idle time per cycle
=1.0 min.
× 100%Nactual × Cycle time 4 × 1.2 min.
= 20.83%
Example:Measuring Effectiveness
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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
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• In designing process layouts, the following information is required:1. A list of work stations (departments) to be arranged and
their dimensions2. A projection of future work flows between the pairs of
work centers3. The distance between locations - and the cost per unit of
distance to move loads between them4. The amount of money to be invested in the layout5. A list of any special considerations6. The location of key utilities, access and exit points, etc.
Information Requirements
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Designing Process LayoutsMinimize Transportation Costs
• Goal:– Assign departments 1, 2, 3 to locations A, B, C in a way that
minimizes transportation costs.
• Heuristic:– Assign departments with the greatest interdepartmental work
flow first to locations that are closet to each other.
A B C
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Example: Minimize Transportation Costs
Location
From\To A B C
A - 20 40
B - 30
C -
Department
From\To 1 2 3
1 - 30 170
2 - 100
3 -
Pair Work flow
1-3 170
2-3 100
1-2 30
TripA-B 20
B-C 30
A-C 40
Distance
Work flow
A BC
20
40
30
Highest work flow
Closest
Place dept. 1&3
in A&B
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Example: Minimize Transportation Costs
• Place departments 1&3 in A&B (2 options)
• 2&3 have higher work flow than 1&2 (100>30)• 2&3 should be located closer than 1&2• C closer to B than to A (30<40)
• Solution:
11 33
A B C33 11
A B CA B
C20
40
30
1 3 2
30
170 100
A B C
Trip
A-B 20
B-C 30
A-C 40
Pair Work flow
1-3 170
2-3 100
1-2 30
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Closeness Ratings(Relationship Diagramming)
• Allows the considerations of multiple qualitative criteria.
• Input from management or subjective analysis.
• Indicates the relative importance of each combination of department pairs.
Muther’s grid
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Closeness Ratings
Production
Offices
Stockroom
Shipping and receiving
Locker room
Toolroom
A A
A O
O
OO
O
U
U U
U
EX
I
A Absolutely necessaryE Very importantI ImportantO Ordinary importanceU UnimportantX Undesirable
A Absolutely necessaryE Very importantI ImportantO Ordinary importanceU UnimportantX Undesirable
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Closeness Ratings : Example
Dept. 1
Dept 2.
Dept 3.
Dept 4.
Dept. 5
Dept 6.
X O
A A
U
AA
X
E
A O
A
UI
X
Assign department using the heuristic:Assign critical departments first (they are most important)
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Closeness Ratings : Example
Dept. 1
Dept 2.
Dept 3.
Dept 4.
Dept. 5
Dept 6.
X O
A A
U
AA
X
E
A O
AU
I X
1. List critical departments (either A or X):
A
1-2
1-3
2-6
3-5
4-6
5-6
X
1-4
3-6
3-4
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Closeness Ratings : Example
Dept. 1
Dept 2.
Dept 3.
Dept 4.
Dept. 5
Dept 6.
X O
A A
U
AA
X
E
A O
AU
I X
2. Form a cluster of A links (beginning with the department that appears most frequently)
A
1-2
1-3
2-6
3-5
4-6
5-662
4
5
3. Take the remaining A links in order and add them to this cluster where possible (rearranging as necessary)Form separate clusters for departments that do not link with the main cluster.
62
4
51
3
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Closeness Ratings : Example
Dept. 1
Dept 2.
Dept 3.
Dept 4.
Dept. 5
Dept 6.
X O
A A
U
AA
X
E
A O
AU
I X
4. Graphically portray the X links
43
1
6
5. Adjust A cluster as necessary.
X
1-4
3-6
3-4
62
4
51
3
(in this case, the A cluster also satisfies the X cluster).
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Closeness Ratings : Example
Dept. 1
Dept 2.
Dept 3.
Dept 4.
Dept. 5
Dept 6.
X O
A A
U
AA
X
E
A O
AU
I X
62
4
51
3
6. Fit cluster into arrangement (e.g., 2x3)may require some trial and error.Departments are considered close not only when they touch side to side but also when they touch corner to corner.
7. Check for possible improvements
1 2 6
3 5 4
43
1
6