Operation Management and TQM Facility Design PDF

Operation Management and TQM Lesson 6: Facility Design Facility Design in Operation Management - is a strategic process that optimizes efficiency, productivity, and safety. - Directly impacts the flow of materials, information, and people within the organization. - Smooth opera...

Operation Management and TQM Lesson 6: Facility Design Facility Design in Operation Management - is a strategic process that optimizes efficiency, productivity, and safety. - Directly impacts the flow of materials, information, and people within the organization. - Smooth operations, reduce waste, and enhance operational flexibility. 10 STEPS OF FACILITY DESIGN 1. Needs Assessment and Goal Setting  To understand the company`s needs, objectives and strategic direction.  Determining high volume of production, the types of products/services offered, customers’ delivery expectations, and a long-term growth plans. 2. Site Selection  An important decision that impacts operational efficiency. 3. Layout Design  Placement of equipment, human resources and raw materials 4. Designing for Material Handling  An efficient material handling system ensures that raw materials, in- process products, and finished goods are moved efficiently through the facility.  The design should include appropriate storage areas, conveyor systems, and automated systems to minimize movement and reduce material handling costs.  Minimizing handling time and travel distance is key for improving the overall flow of operations. 5. Incorporating Technology and Automation   Today’s facilities often incorporate automation and smart technology to enhance productivity.  The design process should consider the integration of robotics, AI, machine learning, Internet of Things (IoT), and automated material handling systems.  These technologies help streamline repetitive tasks, improve quality, and enable data-driven decision-making. 6. Safety and Regulatory Compliance  Compliance with local and international safety standards is essential.  The layout must account for safety zones, emergency exits, fire prevention systems, ventilation, and ergonomic designs for workers. 7. Sustainability and Environmental Consideration  Important for reducing a building's negative environmental impact while creating healthy and productive environments.  A sustainable facility design can also enhance the company’s brand and lead to cost savings over the long term. 8. Cost Estimation and Budgeting  Designing a facility requires significant investment.  The budgeting process involves estimating the costs for site acquisition, construction, equipment, and technology.  Cost-benefit analysis should also be conducted to evaluate the potential return on investment (ROI) from the new facility. 9. Implementation and Construction  The project manager must ensure that the timeline, budget, and quality standards are maintained. 10. Testing and Commissioning  Ensure all systems are functioning as intended.  It’s also important to provide training for employees who will be operating within the facility. Facility Location  - The right location for the manufacturing facility, it will have sufficient access to the customers, workers, transportation, etc. - For commercial success, and competitive advantage. FACILITY SELECTION FACTORS:  Industrialization  Errors in Location Selection  Location Strategy Facility Layout  Is an arrangement of different aspects of manufacturing in an appropriate manner to achieve desired production results. Objective  To provide optimum space to organize equipment and facilitate movement of goods and to create a safe and comfortable work environment.  To promote order in production towards a single objective.  To reduce movement of workers, raw material and equipment.  To promote safety of plant as well as its workers.  To facilitate extension or change in the layout to accommodate new product line or technology up gradation.  To increase production capacity of the organization. To achieve these we must: 1. Better training of the workers and supervisors. 2. Creating awareness about of health hazard and safety standards. 3. Optimum utilization of workforce and equipment. 4. Encouraging empowerment and reducing administrative and other indirect work Design of Facility Layout Principles  Flexibility - facility layout should provide flexibility for expansion or modification.  Space Utilization - optimum space utilization reduces the time in material and people movement and promotes safety.  Capital - capital investment should be minimal when finalizing different models of facility layout. Design Layout Techniques 1. Process Layout (Functional Layout) Description: Grouping similar machines or workstations together based on their functions (eg., all milling machines in one area, all Welding in another. Best for: Job shops, batch production, or custom manufacturing where products are made in varying batches with different processes. Advantages:  Flexibility in production  Easier to manage equipment and specialized personnel. Disadvantages:  Material handling can be inefficient  Higher transportation costs due to long distances between departments. 2. Product Layout (Line Layout) Description: Organizing equipment and workstation in a sequential line based on the production steps required to make a product. Best for: Mass production environments (e.g.., automotive assembly lines, consumer electronics) Advantage:  High efficiency with minimal handling of materials.  Short production times. 3. Fixed-Position Layout Description: The product remains stationary, and tools, equipment and workers are brought to the site (common in construction, shipbuilding, aircraft assembly) Best for: Large, heavy, or complex products that are difficult to more (e.g., airplanes, ships, buildings) Advantages:  Workers and equipment are focused on the product.  Reduces the need for moving large, cumbersome items. Disadvantages:  Can lead to inefficiencies due to space constraints.  Requires precise coordination of resources. 4. Cellular Layout Description: Grouping machines and workstations into cells that process families of products with similar processing requirements. Best for: Environments that produce a variety of products but with similar processes. Advantages:  Reduces transportation time and handling.  Facilitates team-based work and cross-training. Disadvantages:  Can lead to underutilization of machines if the variety of products isn't balanced.  High initial setup costs for cell creation. 5. Grid Layout Description: common in retail environments, this layout uses a simple grid pattern for easy navigation of customers through aisles. "Example of this layout is the grocery store like metro" Best for: Retail spaces (supermarkets, warehouses, big-box stores.) Advantages:  Easy to design and manage.  Encourages customer flow and increases exposure to different products. Disadvantages:  Can be monotonous or difficult to adapt to new product lines.  May lead to congestion in high-traffic areas. 6. Hybrid Layout Description: Combines elements from different layout types to leverage their strengths based on the production needs. For example, you may have a cellular layout for parts assembly but use a product layout for the final assembly. Best for: Complex operations requiring flexibility, such as in industries with mixed production environments (e.g., electronics manufacturing). Advantages:  Flexibility to adapt to varying product types and demands.  Balances cost efficiency and flexibility. Disadvantages:  More complex to design and manage.  Potential for confusion in workflow.  Encourages customer flow and increases exposure to different products 7. Free-Flow Layout Description: Used mostly in retail environments where customers are encouraged to browse freely. This layout does not follow a strict grid or set path, creating an organic and open flow. Best for: High-end retail stores, art galleries, or experiences where customers are encouraged to explore. Advantages:  Flexible, enhances customer experience and discovery.  Higher chance of customers engaging with multiple products. Disadvantages:  Can cause confusion or inefficiencies in larger spaces.  Difficult to manage in very high-traffic areas. 8. Mixed-Model Layout Description: Combines the use of product and process layouts for production of different models or variants on the same production line. Best for: High-variety, low-to-medium volume environments where demand for product variants is high (e.g., electronics or automotive). Advantages:   Flexibility in production.  Optimized for different product types on a shared line. Disadvantages:  Complex scheduling and management.  High initial setup cost. 9. Dynamic Layout Planning (Flexible Layout) Description: An adaptive approach where the layout is designed with future changes in mind. New equipment, technologies, and processes can be easily incorporated as the facility evolves. Best for: Rapidly changing industries or where production needs change frequently (e.g., technology, pharmaceuticals). Advantages:  Future-proof design.  Can accommodate growth or changes in production processes. Disadvantages:  Potentially higher upfront costs and complexity in design.  Risk of underutilization if changes don't occur as expected. Operational considerations and Techniques for Effective Facility Design 1. Lean Manufacturing - facility design should embrace lean principles which fours on reducing waste and improving efficiency. Includes: workflows, minimizing inventory, and ensuring smooth product flow. 2. Six Sigma - integrating six sigma methodologies can enhance the quality of both processes and products, ensuring that the facility is built with minimal defects and that operations run smoothly. 3. Just-in-Time: (UIT) Production - the design should accommodate JIT production techniques, which aim to reduce inventory by having materials arrive just as they are needed, minimizing storage space and waste. 4. Flexible Manufacturing Systems (FMS) - if your business needs flexibility, the facility design may include automated and versatile manufacturing equipment that can quickly adapt to changing product designs of production volumes.