PowerPoint PresentationOperations Management, 4E: Chapter 7
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Operations Management, 4E: Chapter 7
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© Nigel Slack, Stuart Chambers & Robert Johnston, 2004
Operations Management, 4E: Chapter 7
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Layout:
The layout of an operation is concerned with the physical location
of its transforming resources, that is deciding where to put the
facilities, machines, equipment and staff in the operation.
Layout types:
Operations Management, 4E: Chapter 7
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Fixed position layout
In a fixed position layout, the transformed resource does not move
between its transforming resources.
Equipment, machinery, plant and people who do the processing move
as necessary because the product or customer is either:
Too large
Operations Management, 4E: Chapter 7
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Process layout
In a process layout, similar processes or processes with similar
needs are located together because:
It is convenient to group them together or
The utilization of the transforming resource is improved
Different products of customer have different requirements
therefore they may take different routes within the process.
The flow in a process layout can be very complex.
© Nigel Slack, Stuart Chambers & Robert Johnston, 2004
Operations Management, 4E: Chapter 7
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showing the path of just one customer
Entrance
Exit
Enquiries
Operations Management, 4E: Chapter 7
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Cell layout
In a cell layout, the transformed resources entering the operation
move into a cell in which all the transforming resources it
requires in located.
After being processed in the cell, the transformed resource may
move to a different cell in the operation or it may be a finished
product or service.
Each cell may be arranged in either a process or product
layout.
The cell type layout attempts to bring order to the complex flow
seen in a process layout.
© Nigel Slack, Stuart Chambers & Robert Johnston, 2004
Operations Management, 4E: Chapter 7
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showing the sports goods shop-within-a-shop
retail ‘cell’
Sports shop
Books and videos
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Product layout
In a product layout, the transformed resource flow a long a line of
processes that has been prearranged.
Flow is clear, predictable and easy to control.
© Nigel Slack, Stuart Chambers & Robert Johnston, 2004
Operations Management, 4E: Chapter 7
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product layout
Lecture theatre
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Operations Management, 4E: Chapter 7
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layout types
Operations Management, 4E: Chapter 7
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Operations Management, 4E: Chapter 7
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The flow of the operation’s transformed resources
Process type
Operations Management, 4E: Chapter 7
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Operations Management, 4E: Chapter 7
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B
Operations Management, 4E: Chapter 7
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- Product/customer not moved or disturbed.
- Very high unit cost.
- High mix and product flexibility
- Relatively robust if in the case of disruptions
Low utilization of resources.
Complex flow.
- Fast throughput.
Can need more plant and equipment
Lo- w unit costs for high volume
- Gives Opportunities for specialization of equipment
Can have low mix and flexibility
Not very robust to disruption
Work can be very
© Nigel Slack, Stuart Chambers & Robert Johnston, 2004
Operations Management, 4E: Chapter 7
7.*
variable cost characteristics which seem to determine
which one to use. (b) In practice the uncertainty about
the exact fixed and variable costs of each layout means
the decision can rarely be made on cost alone
3) Consider total cost
Use cell or product
Operations Management, 4E: Chapter 7
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© Nigel Slack, Stuart Chambers & Robert Johnston, 2004
Operations Management, 4E: Chapter 7
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Fixed position layout design:
The location of resources for each project is unique and it will be
determined on the convenience of transforming resources
themselves.
Although there are techniques which held to locate resources on
fixed position layouts, they are not widely used because this
layout can be very complex and planned schedules do change
frequently.
© Nigel Slack, Stuart Chambers & Robert Johnston, 2004
Operations Management, 4E: Chapter 7
7.*
Collecting information such as:
cost per distance traveled
Relationship chart
Operations Management, 4E: Chapter 7
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If direction is not important, collapses to
LOADS/DAY
(b)
LOADS/DAY
(a)
9
A
B
C
D
E
A
30
60
20
B
30
30
C
80
D
40
E
Operations Management, 4E: Chapter 7
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Or alternatively
Operations Management, 4E: Chapter 7
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If cost of flow differs between work centers, combine with
LOADS/DAY
(e)
(f)
Operations Management, 4E: Chapter 7
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To give
Operations Management, 4E: Chapter 7
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If direction is not important, collapses to
DAILY COST/DISTANCE TRAVELLED
Operations Management, 4E: Chapter 7
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Operations Management, 4E: Chapter 7
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Cell layout design
Cells in an operation can be created based on two interrelated
decisions:
What is the extent and nature of the cell i.e. the amount of direct
and indirect resources the cell has as shown in Fig 7.28
Which resources to allocate to which cell using:
Cluster analysis – which process group naturally together
Parts and family coding – based on similar characteristics of parts
of products
OR
(See Fig. 7.31)
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Amount of indirect resources included in the cell
Proportion of the resources needed to complete the transformation
included in the cell
e.g.
e.g.
e.g.
e.g.
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to allocate machines to cells
Product
Machines
Product
Machines
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Product layout design
Product type layout is designed based on a technique called line
balancing. The technique consist of the following steps:
Calculating the required cycle time.
Calculating the number of stages.
Producing a precedence diagram.
© Nigel Slack, Stuart Chambers & Robert Johnston, 2004
Operations Management, 4E: Chapter 7
7.*
Cycle time:
It is the time between completed products emerging from the
process.
Example:
Suppose the regional back-office operation of a large bank is
designing an operation which will process its mortgage
applications. The number of applications to be processed is 160 per
week and the time available to process the applications is 40 hours
per week.
Cycle time = 40 = 1/4 hours = 15 minutes
160
© Nigel Slack, Stuart Chambers & Robert Johnston, 2004
Operations Management, 4E: Chapter 7
7.*
required cycle time
Where the total work content is the total quantity of work involved
in producing the product given in time.
Example:
Suppose that the bank in the previous example calculated that the
average total work content of processing a mortgage application is
60 minutes. The number of stages needed to produce a processed
application every 15 minutes can be calculated
Required no. of stages = 60 minutes = 4 stages
15 minutes
If you get a fraction round it up to the higher whole number.
© Nigel Slack, Stuart Chambers & Robert Johnston, 2004
Operations Management, 4E: Chapter 7
7.*
Precedence diagram
This is a diagram representing the ordering of the elements which
comprise the total work content of the product or service.
Two rules when constructing the diagram:
The circles which represent the elements are drawn as far to the
left as possible.
None of the arrows which shows the precedence of the elements
should be vertical.
a
b
c
d
e
f
g
h
i
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Allocating activities to the stages
The general approach is to allocate elements from the precedence
diagram to the first stage, starting from the left, until the work
allocated to the stage is as close to, but less than, the cycle
time.
When the stage is full of work without exceeding the cycle time,
move to the next stage.
Two rules help to decide which activities to allocate to a
stage:
Choose the largest that will fit into the time remaining at the
stage
Choose the element with the most ‘followers’.
© Nigel Slack, Stuart Chambers & Robert Johnston, 2004
Operations Management, 4E: Chapter 7
7.*
Balancing loss
The effectiveness of the line balancing activity is measured by the
balancing loss.
This is the time wasted through the unequal allocation of work as a
percentage of the total time invested in processing the product or
service.
Balancing loss = Total idle time
No. of stages x Cycle time
© Nigel Slack, Stuart Chambers & Robert Johnston, 2004
Operations Management, 4E: Chapter 7
7.*
invested in processing the product or service
which is not used productively
Load
Stage
2.3
2.5
2.2
3.0
An ideal ‘balance’ where work is allocated equally between the
stages
But if work is not equally allocated the cycle time will increase
and ‘balancing losses’ will occur
Work allocated to stage
(3.0 - 2.5) +
Operations Management, 4E: Chapter 7
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Worked Example
Consider Karlstad Kakes, a manufacturer of specialty cakes, which
has recently obtained contract to supply a major supermarket chain
with a specialty cake in the shape of a space rocket. It has been
decided that the volumes required by the supermarket warrant a
special production line to perform the finishing, decorating and
packing of the cake. This line would have to carry out the elements
shown in the next slide, which also shows the precedence diagram
for the total job. The initial order from the supermarket is for
5000 cakes a week and the number of hours worked by the factory is
40 per week. From this:
The required cycle time = 40 hrs x 60 mins = 0.48 mins
5000
The required number of stages = 1.68 mins (total work
content)
0.48 mins (required cycle time)
= 3.5 stages
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for Karlstad Kates
a
b
c
d
e
f
g
h
i
0.12 mins
0.30 mins
0.36 mins
0.25 mins
0.05 mins
0.17 mins
0.10 mins
0.08 mins
0.25 mins
Operations Management, 4E: Chapter 7
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balancing loss for Karlstad Kates
a
b
c
d
e
f
g
h
i
Cycle time = 0.48 mins
Idle time every cycle = (0.48 - 0.42) + (0.48 - 0.36) + (0.48 -
0.42) = 0.24 mins
Proportion of idle time per cycle = 0.24 = 12.5%
4 x 0.48