IB 208 Operations Management

Lecture 15
Process
and Facility Layout
Chapter 6: Process Selection
and Facility Layout

Operations Management (14 Edition)

William J Stevenson

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Process Selection
Process selection refers to deciding on the way production of goods or services will be
organized.
• Process selection occurs as a matter of course when new products or services are being planned. However, it
also occurs periodically due to technological changes in products or equipment, as well as competitive
pressures.

How an organization approaches process selection is determined by the organization’s

process strategy.

Key aspects include:

• Capital intensity: The mix of equipment and labor that will be used by the organization.
• Process flexibility: The degree to which the system can be adjusted to changes in processing requirements due
to such factors as changes in product or service design, changes in volume processed, and changes in
technology

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Process selection and capacity planning influence system design

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 PROCESS SELECTION

• Process choice is demand driven. The two key questions in process selection are:
1. Variety: How much variety will the process need to be able to handle?
2. Volume: How much volume will the process need to be able to handle?
• Process Types
• Job Shop
• Batch
• Repetitive
• Continuous

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 Types of processing

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 Volume and variety influence process choice

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Project

• A project is used for work that is nonroutine, with a unique set of

objectives to be accomplished in a limited time frame.
• Equipment flexibility and worker skills can range from low to high.

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Product and Service Profiling

• Product or service profiling is linking key product or service requirements to process

capabilities.
• Degree of correlation between various process choices and market conditions before
making process choices in order to achieve an appropriate matching.
• Product or service profiling can be used to avoid any inconsistencies by identifying key
product or service dimensions and then selecting appropriate processes.
• Key dimensions often relate to the range of products or services that will be processed,
expected order sizes, pricing strategies, expected frequency of schedule changes,
and order-winning requirements

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Sustainable Production of Goods and Services

• “Sustainable Production is the creation of

goods and services using processes and
systems that are: non-polluting; conserving of
energy and natural resources; economically
efficient; safe and healthful for workers,
communities, and consumers; and socially
and creatively rewarding for all working
people.”
• To achieve these goals, business organizations
must focus on a number of factors that include
energy use and efficiency, CO 2 (carbon
footprint) and toxic emissions, waste
generation, lighting, heating, cooling,
ventilation, noise and vibration, and worker
health and safety

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TECHNOLOGY

• Technology refers to applications of scientific discoveries to the development and

improvement of goods and services and/or the processes that produce or provide them.
It can involve such factors as knowledge, materials, methods, and equipment. The term
high technology refers to the most advanced and developed equipment and methods.
• Process technology and information technology can have a major impact on costs,
productivity, and competitiveness.
1. Process technology includes methods, procedures, and equipment used to
produce goods and provide services.
2. Information technology (IT) is the science and use of computers and other
electronic equipment to store, process, and send information.

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 Technological Innovation

• Technological innovation refers to the discovery and development of new

or improved products, services, or processes for producing or providing
them.
• Technological innovation in processing technology can produce
tremendous benefits for organizations by increasing quality, lowering
costs, increasing productivity, and expanding processing capabilities.

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 Automation

• Automation is machinery that has sensing and control devices that enable it to operate
automatically.
• Automation offers a number of advantages over human labor. It has low variability,
whereas it is difficult for a human to perform a task in exactly the same way, in the same
amount of time, and on a repetitive basis.
• Automation is frequently touted as a strategy necessary for competitiveness. But
• Costly
• requires high volumes of output to offset high costs
• less flexible

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Type of Automation

• Fixed: least flexible. It uses high-cost, specialized equipment for a fixed sequence of operations. Low
cost and high volume are its primary advantages; minimal variety and the high cost of making major
changes in either product or process are its primary
• Programmable: Programmable automation involves the use of high-cost, general-purpose equipment
controlled by a computer program that provides both the sequence of operations and specific details
about each operation. This type of automation has the capability of economically producing a fairly wide
variety of low-volume products in small batches
• Flexible: Flexible automation evolved from programmable automation. It uses equipment that is more
customized than that of programmable automation. A key difference between the two is that flexible
automation requires significantly less changeover time. This permits almost continuous operation of
equipment and product variety without the need to produce in batches.

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 The Internet of Things (IoT)

• The internet of things is the extension of internet connectivity into

devices such as cell phones, vehicles, audio and video device, and much
more.

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 3D Printing

• 3D printing, also known as additive manufacturing, involves processes

that create three-dimensional objects by applying successive layers of
materials to create the objects. The objects can be of almost any size or
shape.
• A 3D printer is a type of industrial robot that is controlled using
computer-assisted design (CAD).

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 PROCESS STRATEGY

• flexibility is a competitive strategy but does not always offer the best
choice in processing decisions.
• Flexible systems and equipment are often more expensive and not as
efficient as less flexible alternatives.
• In certain instances, flexibility is unnecessary because products are in
mature stages, requiring few design changes, and there is a steady
volume of output.

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 STRATEGIC RESOURCE ORGANIZATION:
FACILITIES LAYOUT
• Layout refers to the configuration of departments,
work centers, and equipment, with particular
emphasis on movement of work (customers or
materials) through the system.
• Layout decisions are important for three basic
reasons:
• they require substantial investments of
money and effort
• they involve long-term commitments, which
makes mistakes difficult to overcome
• they have a significant impact on the cost
and efficiency of operations
• 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 Types of Layout
1. Product:
• Product layouts are most conducive to repetitive processing
2. Process:
• Process layouts are used for intermittent processing.
3. Fixed-position:
• Fixed-position layouts are used when projects require layouts.

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Repetitive Processing: Product Layouts

• Product layouts are used to achieve a smooth and rapid flow of large volumes of goods or
customers through a system. This is made possible by highly standardized goods or
services that allow highly standardized, repetitive processing.
• Production line: Standardized layout arranged according to a fixed sequence of
production tasks.
• Assembly line: Standardized layout arranged according to a fixed sequence of
assembly tasks.
• Product layouts achieve a high degree of labor and equipment utilization, which tends to
offset their high equipment costs. Because items move quickly from operation to
operation, the amount of work-in-process is often minimal.

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 A flow line for production or service

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 Cafeteria line

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 Assembly Line

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Product Layouts

Advantage Disadvantage

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 U-Shaped Layouts

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Intermittent Processing/Nonrepetitive
Processing: Process Layouts

• Process layouts (functional layouts) are designed to process items or

provide services that involve a variety of processing requirements.
• The variety of jobs that are processed requires frequent adjustments to
equipment. This causes a discontinuous work flow, which is referred to as
intermittent processing.
• The use of general-purpose equipment provides the flexibility necessary to
handle a wide range of processing requirements.
• Process layouts are quite common in service environments (hospital).

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 Comparison of process and product layouts

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Process Layout

Advantage Disadvantage

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Fixed-Position Layouts

• In fixed-position layouts, the item being worked on remains stationary, and

workers, materials, and equipment are moved about as needed.
• the nature of the product dictates this kind of arrangement

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 Fixed Position Layout
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Combination Layouts

• The three basic layout types are ideal models, which may be altered to
satisfy the needs of a particular situation. It is not hard to find layouts that
represent some combination of these pure types.

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 Cellular Layouts

• Cellular production is a type of layout in which workstations are grouped

into what is referred to as a cell. Groupings are determined by the
operations needed to perform work for a set of similar items, or part
families, that require similar processing.
• Layout in which workstations are grouped into a cell that can process
items that have similar processing requirements.

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Comparison of process and cellular layouts

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A comparison of functional (process) layouts and cellular layouts

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Group • Effective cellular manufacturing must have groups of identified items
with similar processing characteristics. This strategy for product and
process design is known as group technology and involves identifying

Technology items with similarities in either design characteristics or

manufacturing characteristics, and grouping them into part families.

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 Service Layouts

• As is the case with manufacturing, service layouts can often be

categorized as product, process, or fixed-position layouts.
• Service layout requirements are somewhat different from manufacturing
layout requirements. The degree of customer contact and the degree of
customization are two key factors in service layout design.

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 DESIGNING PRODUCT LAYOUTS:
LINE BALANCING

• Line balancing is the process of assigning tasks to workstations in such a way that the
workstations have approximately equal time requirements.
• Lines that are perfectly balanced will have a smooth flow of work as activities along the line
are synchronized to achieve maximum utilization of labor and equipment.
1. The major obstacle to attaining a perfectly balanced line is the difficulty of forming
task bundles that have the same duration.
2. Another cause of difficulty is that differences among elemental task lengths cannot
always be overcome by grouping tasks.
3. A third cause of an inability to perfectly balance a line is that a required technological
sequence may prohibit otherwise desirable task combinations.

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Cycle Time
Cycle time: The maximum time
allowed at each workstation to
complete its set of tasks on a unit.

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Theoretical
Minimum

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 Arrange the tasks
shown in Figure 6.9 into
three workstations. Use
a cycle time of 1.0
minute. Assign tasks in
order of the greatest
number of followers.

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 Two widely used
measures of
effectiveness
are: Percentage
of Idle time
(Balance Delay)

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 Two widely used measures of effectiveness are: Efficiency

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DESIGNING PROCESS LAYOUTS

• The main issue in designing process layouts concerns the relative positioning of the
departments involved.
• Layouts can be influenced by external factors such as the location of entrances, loading
docks, elevators, windows, and areas of reinforced flooring. Also important are noise
levels, safety, and the size and locations of restrooms.
• The majority of layout problems involve single rather than multiple locations, and they
present unique combinations of factors that do not lend themselves to a standardized
approach. Consequently, these layouts require customized designs.
• A major obstacle to finding the most efficient layout of departments is the large number
of possible assignments.

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 Measures of effectiveness

• Information requirement
• Minimizing Transportation Costs or Distances
• Closeness Ratings

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