Break Even Analysis and Decision Making

Break Even Analysis and Decision Making

LESSON-5

BREAK-EVEN ANALYSIS AND DECISION MAKING 5.1 Preamble5.2 Mechanisation decisions5.3 Choices among process alternatives5.4 Make-buy decisions5.5 Economic analysis5.6 Non-economic and intangible factors5.7 Make-buy policies5.8 Cautions in the use of break-even analysis5.9 Summary5.10 Key concepts5.11 Model questions5.12 Reference books 5.1 PREAMBLEBreak-even concepts can be applied as an aid to managerial decision making in number of areas. Mechanisation decisions, choosing among process alternatives and make-buy decisions are some of the areas where this break-even analysis can be applied effectively. 5.2 MECHANISATION DECISIONSSuppose a new glass cutting machine would decrease the amount of glass breakage and the labor required in the manufacture of a solar heating panel which was discussed in example-2 of lesson-4. A decision has to be taken whether to go for the new machine or not. The decision will be based on the new cost estimates. For the new machine there will be an additional fixed cost of Rs.3000 would have to be invested in addition to the fixed cost of Rs.20000 but the variable cost would reduce to Rs. 75 per unit from Rs.80 per unit. With this new information on cost data, the break-even point, Q = F . P – V = 23000 . 100 - 75 = 920 units.

The installation of this new machine would reduce the break- even volume to 920 units from the previous BEP of 1000 units. This would be an important and the decision would be taken to buy the new machine. 5.3 CHOICES AMONG PROCESS ALTERNATIVESBreak-even analysis can also be used to aid in making choices from among the alternative processes by comparing relative advantages of each. In a manufacturing situation processing requires simple machines which are easy to setup, are usually slow and costly to operate. On the other hand, larger volumes of output may allow the use of faster machines which are costly to setup but once setup they are less costly to operate. Often there are several alternative methods, each of which may be the most economical for certain ranges of output. The method which must be used depends upon the expected volume of output. Deciding the choices among processing alternatives can be best explained with an illustration. A decision has to be taken about the processing methods among the alternatives for making a small bush. This bush can be made on an ordinary general purpose lathe which is easy to setup but not very efficient in production. The bush can also be made on a turret lathe which is more costly to setup but it can produce at lower unit cost, once it is setup. However, when the volume of requirement of bush increases, automatic screw machines would be preferable. Setup costs are much higher for such automatic machines but the operating costs are much lower. The following cost data may be taken for the three processing alternatives: Setup cost Operating cost in rupees per unit in rupees Lathe 250 5.0Turret lathe 500 2.5Automatic screw machine 1450 1.0 If 'x' is the quantity to be made each time the machine is setup, the cost formula for the three alternatives becomes,

Lathe : 250 + 5x Turret lathe : 500 + 2.5x Automatic screw machine : 1450 + l.0x

Fig. 5.1 shows graphically the comparison of costs for making the bush on these three machines. Lathes are the least costly for very small quantities, then turret lathes and then automatic screw machines for large quantities. The chart shown in fig. 5.1 would be needed for deciding the method to be used for a given volume of production. The exact cross

Thus the point 'C' on the chart of Fig. 5.1. is at a volume of 633.From the above calculation, for orders under 100 units, a lathe should be used, for 100 to 633 turret lathes and above 633 an automatic screw machines. If all the turret lathes are tied up on other work and

not available, then a lathe should be used up to 300 units and automatic screw machines for orders of more than 300 units. Crossover charts can also be used in new equipment purchase choices. The lines on the charts would compare the costs of doing the work in the present way against what they would be if a machine were bought. 5.4 MAKE-BUY DECISIONS The break-even concepts can also be used in make-buy decisions. Make-buy decisions are those where a company's manager choose between making a part inside or buying it already made from the outside. Make-buy questions can come up at any time. When such a question comes up and if the company have idle capacity then the decision to make is almost automatic since the cost of machine does not need to be considered. The real make-buy questions come up when making would involve the purchase of more equipment. Break-even analysis can help in this situation. Factors affecting make or Buy decision Every manufacturing concern must decide whether to use its product skill and effort to make each of multiple items or whether to buy them. The possibilities are tremendous when all of the materials, supplies and finished products with which a manufacturing concern deals are considered. Fortunately manufacturing a large share of these items need not be considered. For supply items as paper clips, pencils and eraser specialisation makes their manufacture uneconomical to all concerns except those in that particular field. As a matter of fact real opportunities are sometimes overlooked because of this pattern of buying items. The product has been designed and its specifications are summarised on blueprints or drawings. Analysis of the product may reveal that, the product may have 1,10,100,1000 or 10000 parts for making it. A large transport aircraft is made up of over 50,000 parts. Out of these parts, it has to be decided which are to be made and which are to be bought? Also it has to be decided about the Valid criteria for making these decisions.

LESSON-6

PLANT LOCATION FACTORS6.1 Preamble6.2 Aspects of plant location6.2.1 Process inputs6.2.2 Process outputs6.2.3 Process characteristics6.2.4 Personal preferences6.2.5 Tax incentives and legal aspects6.3 Steps in the plant location study6.4 Area selection6.5 Community selection6.6 Site selection6.7 Influence of location on plant layout6.8 Common errors in plant location analysis6.9 Summary6.10 Key concepts6.11 Model questions6.12 Reference books 6.1 PREAMBLEVery early in the planning phase, the operations manager is faced with a plant location decision. The small entrepreneur, when considering a location for his welding shop, is concerned with easy access to the shop by potential clients and with building costs and rental rates. The major national producer of chain saws considers his markets, the availability of skilled personnel, the supply of raw materials, energy and so on. The location of a plant is a major decision and is affected by many factors both internal and external to the organizations operations. Internal factors include the technology used, the capacity, the financial position and the work force required. External factors include the economic, political and social conditions in the various localities. Most of the fixed and some of the variable costs of the operations are determined by the location decision. Thus the efficiency, effectiveness, productivity and profitability of the plant are affected by the plant location decision. While some aspects of locational analysis can be dealt with quantitatively, the final decision is based largely on informed qualitative judgment 6.2 ASPECTS OF PLANT LOCATION OR VARIOUS FACTORS AFFECTING PLANT LOCATION

The location of a facility, be if a manufacturing or service is largely affected by the following aspects.(i) Process inputs(ii) Process outputs(iii) Process characteristics(iv) Personal preferences(v) Tax incentives and legal aspects 6.2.1 Process inputsProcess inputs involve raw material, personal and other inputs. So far as raw materials are concerned transportation costs are importance. These costs are significant when bulky and heavy raw materials are involved in the process.When there is only one raw material source and many dispersed markets, one considers locating the facility near the raw material source. However, when there are various raw materials that are to be used for the production of one single marketable product, one considers locating the facility near the market. Inputs other than raw materials are also involved in the operation process. For example work force availability and wages are of far more importance to an operation than are raw materials. Service organisations and labor intensive industries are very sensitive to the availability, the skill level and the pay rate of the work force. However, to a certain extent increased mechanisation has contributed to the reduced importance of the labor aspects of location analysis. Another consideration in the context of human resources is the availability of man power. Generally the work force consists of skilled, semi-skilled and un-skilled personnel. All of these skill levels are represented in organisations. For example if a plant is to be located in a low skill, low wage area, the degree of mechanisation must be increased. The work assistants and habits of locally recruited personnel are also important. 6.2.2 Process outputsProcess outputs involve distribution costs. The more bulky and heavy the finished product is the more costly becomes the distribution. Also if the operation is more service oriented it is important that the plant to be located near its market. For industries where services are not directly consumed such as automobile repair shops and headquarters of mortgage and trust companies location Is not so crucial. However, services that are directly connected such as those of bank branches , theaters, restaurants, apartment buildings and public parks locations near the consuming public is crucial. As matter of fact proximity to the market is possibly the most important consideration in location

services that are directly consumed. When the process requires a great deal of energy as does the steel industry it should be located next to a major source of power. When the process requires a great deal of water as does the sugar industries it should be located where water is available in ample supply. 6.2.3 Process characteristicsThese are concerned with the equipment or conditions. Very noisy or odor or chemical producing plants should be located far away from urban or sub-urban communities. Certain weather conditions are advantageous for varies processes. For example a certain humidity level is favourable for sanitary operations. A certain humidity level is required for the printing Industry because of the paper sheet feeding technology which is based on vacuum cups. The facility location is thus affected by the process requirements. 6.2.4 Personal preferencesPersonal preferences of the entrepreneur or top executives of the company also affect the location decision. 6.2.5 Tax incentives and legal aspectsThese are very important factors corporate tax, personal income taxes and sales tax all affect the location decision. Obviously the corporate tax structure is built into any location feasibility study made by the corporation. Personal taxes determine how attractive the move to the new location is and what the wage structure should be. Various communities, states and government offer incentives for facility location by providing industrial parks, properly zoned land at favorable tax rates and rebates based on capital allowances and per worker outright grants. At times loans and loan guarantees are offered. Certain industries are banned from certain localities. Certain products might be legally banned from certain localities. These aspects of facility locations should be checked and confirmed.

Please use headphones6.3 STEPS IN THE FACILITY LOCATION STUDYIn most cases a location analysis should begin with a preliminary survey of the aspects indicated above to determine whether or not the use of new plant site might be justified. When it is not justified the study simply ends. If the survey indicates that new sites may be desirable, a detailed analysis that carefully evaluates all possible alternatives should be undertaken. Usually, the analysis is undertaken in several stages. Three levels of

problems must be attacked when considering plant location. They are.(i) Selection of general territory or area(ii) Selection of a specific community(iii) Selection of specific site Sometimes the second and third levels are confined. Although some location factors may be applicable at all the three levels, there are certain unique considerations when selecting a general area, community and site. The selection of factors consider at each stage is to an extent arbitrary. Some factors may be evaluated at different stages and some are evaluated in all the three stages. What is important is that all the factors be considered at same point in the analysis. Numerous sources of information are available to assist the firms with the analysis. Location informatics of a general nature may be obtained from the following sources:(i) Central Government(ii) State Government(iii) Chamber of Commerce(iv) Electricity Board(v) Gas authorities(vi) Railways(vii) Transport Corporation(viii) Engineers and Builders(ix) Consultants 6.4 AREA SELECTION

Area or territory selection calls for the information of a more general nature. In this initial phase, management is involved in selecting region or general area in which the plant should be located. The following are some of the important factors that influence its selection. MarketThe market is a location of the buyers. It is a factor to be considered in plant location. Depending on the product, market may be concentrated or widely dispersed. When a market is concentrated, the market factor may tend to influence the investigator to locate close to this concentration. For a product servicing a dispersed market the influence of the

market factor becomes less obvious. It is possible to determine the center of the market, which is a statistical device helpful in approximating that point which will provide the lowest cost for distribution. The center of the market can be used only as a guide for plant location. The method used to locate a market center is analogous to locating the center of gravity of a two dimensional object in mechanics. Locating plant near the markets for this products and services is of primary importance in a plant location decision. Particularly this factor should be considered if the manufacturing increases the bulk or weight of the product, renders it more fragile or make it capable of being easily spoiled. Besides, adding transportation costs, distance adds to transmit time and slows down delivery thus affecting promptness of service. If the product is relatively inexpensive and transportation costs (e.g. bricks, cement) add substantially to the price, a location near the market is desirable. Also if the product is custom-made, close customer contact is essential. In assembly type industries many raw materials are gathered together from diverse locations and assembled into single units. Such industries tend to locate near the market. Raw materials The location of raw material is influential in the location problem. Some industries by the nature of their manufacturing process are forced to locate the near raw material sources. The steel industry has traditionally located close to the coal fields since it uses coal in large quantities. However since new processes have been developed for basic steel refining which eliminate the need for coal , this change in the raw material demand could lead to a complete relocation of the steel industry. The raw material could be treated in three classes.(i) Pure material which are included in the manufacturing part without loss of weight.(ii) Weight losing materials, only a part of whose weight is represented in the weight of the finished article.(iii) Materials found virtually everywhere. By assuming uniform rates per distance traveled, which is an oversimplification, the following generalisation regarding the effect of raw material on plant location may be made.(i) When a single raw material is used, without loss of weight, locate the plant at the raw material source, at the market or at any point in between them.

(ii) When a weight losing material is demanded for the plant, then locate the plant at the raw material source.(iii) When a material found everywhere is used, locate close to market area, since the material, is available everywhere. Ease of access to suppliers of raw materials, parts, tools, equipment, etc. may be important. Promptness and regularity of delivery from suppliers and minimization of freight costs are important. In general this factor is most likely to be important in transportation of materials and parts represents the major portion of unit costs and these inputs are available only in a particular region. If the raw material is bulky and if it is greatly reduced in bulk by transferring into various products and by-products in processing, then location near raw material sources is important. If the raw material is perishable and processing makes it less, then also locating near raw material source is important if raw material comes from a variety of locations, the plant may be situated so as to minimize total transportation cost. In calculating transportation costs, the fact that should be considered is that these costs are not simply a function of distance but vary depending upon specific routes and specific product classifications. The problem of transportation is an important factor in plant location. The movement of material can consume a very high percentage of the final cost to the customer. One plant location analysis for a specific plant done by an analyst showed that locating the plant as little as 400 kilometers from the best location caused lost potential projects of as much as Rs.30 lakhs per year. This penalty included higher cost of labour, power and fuel as well as higher transport costs. The different transportation medium may be listed as follows.(i) Railroads - all classes of traffic. (ii) Water carriers - all classes of traffic (iii) High way vehicle - all classes of traffic. (iv) Pipe lines - Bulk liquid and gases. (v) Aircraft - Where speed is essential and where access by the surface agencies is difficult (vi) Pack animals - in different terrain. (vii) Belt, cable or rail conveyers of various types -short distance.

(viii) Human carriers - short distance and small quantities. (ix) Electric cable- electric energy. (x) Telecommunications - Information commercial negotiations. Each of the above transportation mediums has its advantages and limitations. In order to select the proper transportation media, the shipper should consider the following. i) Type and extent of material handling facilities at origin and destination. (ii) The relation cost of the various media, (iii) The urgency of the shipment, (iv) The demand for special services, e.g. refrigeration. Transportation cost vary with the type of route, media and the type of media selected as well as the length of distance travelled. In general, the cost of moving material per unit distance travelled tapers of as the length of distance travelled increases.

FIG. 6.1 HYPOTHETICAL COMPARISON OP COSTS FOR VARIOUS TRANSPORTATION MEDIA

Fig. 6.1 shows an analysis involving break even point to select a transportation media for a particular situation. In this case truck transportation appears to be the most economical up to a distance of approx. 80 Kms. Transportation by waterway appears to be most economical for long distance traveling for distance greater than about 700Kms. For traveling distances between 80 - 700 Kms. the railroad appears to be most efficient carrier. The break even chart shown in Fig. 6.1 is a hypothetical one. However, such a chart can be constructed if real data are available for taking the decision

with respect to the selection of transport media. Adequate transportation facilities are essential for the economic operations of a production system. The bulk of all freight shipment is made by rail. Rail transport offers a great deal of flexibility and speed. Most firms require access to railways which they consider to be essential carriers of their products. For companies that produce or buy heavy and bulky commodities, water transportation is an important factor in locating plants. Truck transport is also important particularly for inter-city transport. Availability of pipelines may also influence location. Use of aircraft is also expanding and so the proximity to airports be vital. Traveling expenses of management and sales personnel should also be considered. Labour supply and wagesNot only the labour force must be available but also it must contains the skills required in a given manufacturing process. The history of labour relations in a prospective area for location should be studied. For obvious reasons, it is difficult to secure objective comments from area leaders and local government officials particularly if they are promoting their community. The rate of labour turnover is a good indication of the relationship between management and labour. A high turnover rate shows up in a high labour cost and it is directly related to productivity. If the labour force required by a particular industry is predominantly female, the location problem takes on some different aspects compared to a plant whose labor force is predominantly male. Wage levels must also be considered. Wages and skill available may be lower in a particular region and therefore industries requiring many unskilled workers, which pay low wages, are attractive to such regions. Manpower is one of the most important and costly inputs in production systems. An ample supply of labour is essential. Firms often look at the areas in which there will be more than three or four times of the permanent job applicants available than the required number. It is also advantageous to locate in places where there is diversification between industries and business. It is not desirable to have more than 50% of the available work force in manufacturing. The type and level of skills possessed by the labour force is important. If company requires particular skills that are not wide spread, it may have to locate near the particular areas where these skills are available. Otherwise, training costs might be more and inadequate

productivity would result. In these cases, skilled labour is desirable but not essential since all the workers will require some training anyway. It should be noted that a firm can relocate from a high skill/high cost to a low skill/low cost operation if sufficient process mechanization is achieved to permit trading off the higher investment in machinery for less manpower and lower wages and level of skills. The existence of regional wage rate differentials may be important particularly in those cases in which labour cost represents the bulk of total production cost as in the textile industries. This factor must be considered in light of the skills available in the area, the size of the labour force, productivity levels, etc., The extent of unionizations, prevailing labour- management attitudes, history of labour relations, turnover rates, absenteeism, etc., should also be considered. Climate and fuel Climate greatly influences human efficiency and behavior. A plant whose production process require a constant temperature of 20°C will find no such situation. It should be located on a site that has a mean temperature of 20°C and standard deviation of 5. This will call for the least amount of artificial heating and cooling. Heating engineers can compute heating costs on the basis of the temperature data. In addition to fuel costs, climate can influence the selection of a territory because of the amount of precipitation or air pollution. Wind velocity and direction can also influence plant location. These become very important factors when the possibility of radioactive fall out resulting from an attack upon a distant city is considered. Location of other plants and warehouse Firms always try to place new plants where they will complement sister plants and warehouses and minimize total cost. They look for market needs and supply and demand disparities and locate where major markets have been served by long distance travels. The location of competitors plants and warehouses must also be considered, the object being to obtain an advantage in both freight costs and the level of customer service. 6.5 COMMUNITY SELECTION Once the general territory for location has been selected, it becomes necessary to choose a community and a site. A decision must be made

regarding the size of the community in which the plant is to be located. The alternative choices can be classified as:

1 City location2 Suburban location3 Country location

City Vs Suburban Vs Country The advent of the automobile has brought new mobility to the working force. This is one of the reasons for the present day Industrial rush to the country. Wide-open spaces and freedom to expand are probably two of the biggest inducements. The type of manufacturing process may dictate the site relation. For example, a country location is desirable for a plant producing explosives. Some of the general conditions leading to the selection of an appropriate type of community might be listed as follows: (a) Conditions suggesting a city location (i) Large skilled labour required (ii) Process heavily dependent upon availability of city utilities (iii) Multi floor building desirable (iv) Close contact with suppliers is demanded (v) Rapid public transportation is available. (b) Conditions suggesting a Suburban location (i) Semiskilled labour force required (ii) Avoidance of heavy city taxes and insurance desired (iii) Labour force residing close to the plant (iv) Plant expansion is easier than in city (v) Community close to but not in large population center. (c) Conditions suggesting a country location

4 Large site required for either present demand or expansions5 Lowest property taxes available desired

(iii) Unskilled labour force required (iv) Low wages required to meet competition

(v) Morale of working force improved by country location

(vi) Manufacturing process is dangerous or objectionable

The choice of the community depends upon the region already chosen.

Most community selection factors cannot be quantified and can only be evaluated subjectively. Managerialpreferences This often plays an important role in plant location decision. Many times due to community ties companies will not relocate. When firms do relocate the location selection in some cases is heavily influenced by the preferences of the managers who will be transferred. Community facilities This involves such factors as quality of life, which in turn is a function of the availability of such facilities as schools, churches, medical services,- police and fire protection, cultural, social and recreational opportunities, having good streets and highways. Also important are the communication facilities and the range frequency and reliability of transportation facilities. Community attitudes Community attitude is an another factor to be considered in locating a site for the plant. The cultural social and educational community atmosphere is being given more attention by plant location investigation, since management has recognised that these aspects are often important to key employees. The political climate of a community might well be investigated. The tendency of government bodies to encroach on the privilege of business has caused management to carefully study the political climate in a prospective location. The back issues of the local newspaper over a period of time can reveal such aspects. These can be difficult to evaluate. Unless the industry is for some reason of an offensive nature, most communities welcome new industries. However, the formation of anti-industrial pressure groups or a lack of co-operation, interest and enthusiasm on the part of community can result in poor relation between the relocating firm and local government, labour and the general public. Community, government laws and taxation

State and local laws should be studied when considering various location. Labour laws, workmen's compensation laws, etc., vary widely from one location to another. Some of the aspects of industrial operation regulated by law are hours of work, minimum wages and working conditions for women employees. The respective laws should be investigated which may penalize certain types of industry in certain areas. Waste disposal smoke reduction and nuisance regulations should be studied for the various alternative locations. Some industrial concerns pay excessive taxes. Taxes should be considered in selecting a site but a plant location analysis says that tax incentives are relatively unimportant secondary factor of location. Given the governing factor, the tax incentive may induce a specific location within the area defined by the basic factor. If the location offering tax incentives is not within the area set by the governing factor, it is simply not considered. Stable, honest and co-operation of government officials are important asset as most of the local legislations affecting industry is under their control. Restricting, unreasonable local ordinary concerning building codes, zoning, pollution control etc., can seriously inhibit operations.Tax rates are important but must be considered in terms of services provided. There should be some attempt to forecast these charges. If future expansion of community services and facilities is likely, taxes will probably increase. Financial inducements Many central and state governments offer subsidy and financial inducements to companies to influence them to build plants in their areas. Government may provide loans for plants for newly established plants within their regions. However, the companies should not allow temporary inducements to overshadow the basic merits of any location. Profile of present industry The kinds and quality of industrial concerns already in the community area also pertinent factory to be considered in plant location. 6.6 SITE SELECTION This is the final stage in the plant location analysis.

One thumb rule regarding the size of a site is that it be not less than five times the actual size of the plant itself. This is considered a minimum in order to allow for loading platform, siding, transport access, parking facilities and storage area. Wherever possible, open land is desirable or two or more sides to allow for future expansion. Unfortunately, tempting offers of a fine site or attractive tax promises frequently influences plant location decision. Objective data is essential to good plant location.Researchers in plant location say that in order to properly select a site, a list of general specification should be as follows. (i) Description of the building to be constructed including the sketch. (ii) Size of the plot. (iii) Necessary railroad, highway and waterway facilities, (iv) Minimum size of water mains, gas line and power line. (v) Volume of ground water to be utilized, (vi) Sewage and effluent disposal requirements, (vii) Safety area for offensive odors, noise, smoke, etc. (viii) Provisions for sprinkler pressure (ground tank or local water main) The maps published by the Geographical Survey are useful in selecting a good plant site. These maps show the landelevations, water feature, dams, buildings, railroads and power lines. When choosing a site the following factors should be investigated. Size of site The plot of land must be large enough to hold the proposed plant and parking and access facilities and provide room for future expansion. Industrial parks are often an excellent choice except for heavy industry TopographyThe topography, soil mixture and drainage must be suited to the type of building required and must be capable of providing with a proper foundation. If considerable land improvement is required, low-priced land may turn to be expensive. Utilities The cost, adequacy and reliability of the supply of power and water must be evaluated.

PowerAll industries today require electric power of some sort. In addition, there are certain industrial processes that require large amount of electric power. For example the refining of aluminum require cheap electricity in large amounts and for this reason aluminum processing plants are located in areas where large sources of inexpensive power is available. In a situation where a large amount of steam is utilised for processing or heating it is sometimes advisable to use this steam for power generation purpose. The following check list may be helpful when examining the power situation in a given area. (i) Type of service a. Hydro - electric b. Steam c. Other (ii) Reliability of service - history of stoppages, (iii) Adequacy of supply - seasonal restriction. (iv) Kind a. phase b. cycle c. voltage (v) Rates

(vi) Availability of off peak contracts, (vii) Fuel adjustment, (viii) Lighting allowances

(ix) Discounts and penalties. Hydro-electric power is usually associated with cheap rates, although the original Installation of the hydro electric plant is considerably more costly than that of steam plant. Technical developments leads to constant improvement in power generation and distribution. Water

There are certain industrial processes which requiring large quantities of water. Selecting a site with a good water supply is essential in steel, paper board, paper pulp, food and chemical processes. Water is generally available from three sources, (i) surface - water from lakes, streams, etc., (ii) ground - springs and wells and (iii) rain water

Surface water varies greatly in its chemical analysis and microscopic organism and vegetation may add taste and color harmful to specific manufacturing processes. Hard water can damage steam boilers, pumps and circulating systems, engines and other water jacket equipment. The pH factor is the measure of hydrogen ion concentration of water and it is an expression of its acidity or alkalinity. This factor should be checked if hardness affects the manufacturing process. The cost of the supply of power and water are sizeable and constantly recurring costs. Accurate cost determination requires contact with the local utility company. Use restrictions may be imposed and there may be wide variations in availability. The water supply must be sufficient to meet peak needs and compensate for dry spells. If water is poor quality it may require chemical treatment or purification. The cost of connecting these services to the plant must not be overloaded. Sometimes it can be done only at high costs. Waste disposal This must be considered when selecting the site. The plant should be positioned so that prevailing winds carry any fumes from populated areas and so that waste may be disposed of properly and at reasonable expense. Waste disposal is getting to be more and more of a problem as industrial concentration built up. As the radioactive materials finding its use in industry in increasing numbers, the problem of disposal of radioactive waste has become quite critical. Enterprising businessman in a heavily industrialized area might establish profitable business of collecting arid disposing of radioactive wastes from the industries. Transportation facilities

Railroads and highways should be close by in order to minimize the cost of rail lines and access roads. There must be enough through highways and railroads to serve the community itself. Special requirements for water or air transport must be considered. The plant itself should be easily accessible by car or preferably public transport. Intangible factors to consider include the dependability and character of the available carriers, frequency of service and freight and terminal facilities. Cost and time required to transport the finished product to market and the time required to contact or service a customer must also be considered. Land costsThese are generally of minor importance as they are non-recurring and make up a relatively small proportion of the total cost of locating a new plant. It should be emphasized that plant location analysis is a periodic task. The world is rapidly changing and the management should not expect a location to remain optimal for ever. Every organization should periodically reassess its environment whether any long term changes have occurred that may make it advantageous for the organization to alter or possibly relocate some portion of its facilities. 6.7 INFLUENCE OF LOCATION ON PLANT LAYOUT Plant location will determine the proximity of a plant to its source of raw -materials and its market area. The distance from the plant to these two areas tend to determine the method of transportation to be used. In turn the type of transportation determine whether the layout should provide for railroad, truck or water loading and unloading facilities. The arrangement of the shipping and receiving departments will vary in the layout according to the type of transportation utilized. A plant location may be determined, in part, by the fuel requirements of the concern. The plant layout must provide for storage of this fuel, whether it be coal, oil or gas. Also the layout must consider the requirements for power generation. The demands of future expansion on the plant are influenced by the location of the plant. When plant expansion in a city location must take place by adding stories to a presently constructed building, the plant layout problems are some what different than they would be in a country location, where plant expansion might take place horizontally by adding a wing to a single storey building. Materials handling problem in a single storey building are quite different from those in a

multi storey building. 6.8 COMMON ERRORS IN PLANT LOCATION ANALYSISSometimes the location selected is poorly suited to the company's needs. Among the more common causes of failure to make a proper location decision are the following: (i) Labour cost miscalculations. (ii) Inadequate labor resources (iii) Failure to anticipate growth-firms overlay influenced by short term consideration find expansion restricted by natural boundaries, residential or commercial encroachment, limited utility, etc., (iv) Carelessness in checking site (v) Lack of distribution outlets (vi) Failure to predict local impact of new plant (vii) Lack of supporting facilities, (viii) Mis-information on utility costs and problems (ix) Underestimated importance of taxes (x) Failure to identify critical costs. (xi) Choosing a community in which living conditions are sub-standard. (xii) Allowing the personal opinions and prejudices of company officers to influence the decisions. (xiii) Purchase of an existing building due to low price, even though it is unsuited to firm's process.

6.9 SUMMARY The problem of facility location is a most important one and falls into

the category of long-range planning. It entails a multiplicity of technological, economic, and behavioural dimensions. The problem of selecting a proper facility location calls for a detailed study of the cost aspects as well as the behavioural aspects. The data that are required for a location study should be collected from a variety of sources, including government, local municipalities, transportation authorities, potential customers, and suppliers and internal sources (engineers, planners, executives). The effectiveness, efficiency, productivity, and profitability of the operations are affected by the facility location decision. Facilities location planning entails consideration of the technology of the process, the behaviour of potential employees, and the economic impact of the location. Such planning obviously represents a major effort. However, this effort is justified, as the operations manager might remember from the slogan: "The three most important decisions in the life of a business are: location, location and location." 6.10 KEY CONCEPTS Process inputs Process outputs Process characteristics Personal preference Tax incentives and legal aspects Territory Comments Site Location influence on layout 6.11 MODEL QUESTIONS 1. "The location of a plant is a major decisions affected by many factors, both internal and external to the organisations operations"- Explain. 2. List and describe plant location factors.

3. What are the steps of a plant location study? 4. What are the common errors in plant location analysis? 5. How does the location factors influence the plant layout? 6.12 REFERENCES 1. Buffa, "Modern production management", John Whiely. 2. Menipaz, Ehed, "Essentials of production and operations management", Prentice Hall 3. Apple, J.M., "Plant layout and Materials Handling", Ronald Press. 4. Moore, F.G., "Plant layout and design"

LESSON-7

A PLANT LOCATION MODEL

7.1 Preamble 7.2 Classification of criteria 7.3 Model structure 7.4 Subjective factor weight 7.5 Site weight 7.6 An example 7.7 Summary 7.8 Key concepts

7.9 Model questions 7.10 Reference books 7.1 PREAMBLE In plant location models, the objective is to minimize the sum of all costs affected by location. Some items of cost, such as freight, may be higher for city A and lower for city B but power costs, for example, may have the reverse pattern. A location is obtained that minimizes costs on balance. In attempting minimize cost not only the today's cost are considered but 'also long-run costs as well. Therefore the influence some of the intangible factors that may affect future costs must also be predicted. Thus factors such as the attitude of city officials and town's people towards a new factory site in their city may be an indication of future tax assessments. Poor local transportation facilities may mean future company expenditures to counter balance this disadvantage. A short labor supply may cost labor, rates to be bid up beyond rates measured during a location survey. The type of labor available may indicate future training expenditures. Thus although a comparative cost analysis of various locations may point toward one community an appraisal of intangible factors may be the basis of a decision to select another. A model that attempts to deal with the multi-dimensional locational problem was developed by Brown and Gibson. This model classifies criteria affecting location according to the model structure, quantifies the criteria and achieves the balancing or trade-off among criteria. 7.2 CLASSIFICATION OF CRITERIA The Brown and Gibson model deals with any list of criteria set by the management but classifies them as follows:

(i) Critical factor (ii) Objective factor (ill) Subjective factor Critical factor Criteria are critical if their nature may exclude the location of a plant at a particular site regardless of other conditions that might exist. For example, a water oriented enterprise such as brewery, would not consider a site where there is a water shortage existing. An energy oriented enterprise such as an aluminum smelting plant, would not consider sites where low-cost and plentiful electrical energy was not available. Critical factors have the effect of eliminating sites from consideration. Objective factor Criteria that can be evaluated in monetary terms such as labor, raw material, utilities and taxes are considered as objective factors. A factor can be both objective and critical. For example, the adequacy of labor would be a critical factor whereas labor cost would be an objective factor. Subject factor Subjective criteria characterized by a qualitative type .of measurement. For example, the nature of union relationships and activity may be evaluated, but its monetary equivalent cannot be established. Again, criteria can be classified as both critical and subjective. The subjective factors may include, a) Availability of transportation. b) Industrial sites.

c) Climatic conditions. d) Educational facilities. e) Union activities. f) Recreation facilities. g) Future growth. h) Cost of living. i) Competition. j) Availability of labour. k) Type of labour. 1) Attitude.

Please use headphones A Plant Location Model 7.3 Model Structure

For each site, that is, a location measure LMi is defined that reflects the relative values for each criterion. LM1 = CFMi { X . DFM1 + ( i - X ) SFMi } ... (1) Where CFMi = the critical factor measure for site ‘i’ ( 0 or 1 ) OFM1 = the objective factor measure for site ‘i’ ( 0 < = DFMi < = 1 and ∑i DFMi = 1 ) SFM1 = the subjective factor measure for site ‘i’ (0 < = SFMi < = 1 and∑ i SFMi = 1 ) X = the objective factor decision weight. The critical factor measure CFM1 is the product of the individual factor indexes for site ‘i’ with respect to critical factor ‘J’.

The critical factor index for each site is either 0 or 1 depending on whether the site has an adequacy of the factor or not. If any critical factor index is 0, then CFM1 and the overall location measure LM1 are also 0. Site ‘i’ would therefore be eliminated from consideration. The objective criteria are converted to dimensionless indices in order to establish comparability between the objective and subjective criteria. The objective factor measure for site ‘i’ OF Miin terms of the objective factor cost OFC1 is defined as follows: OFM1 = [OFC1 ×∑ i ( 1 / OFCi]-1 . . . (2) The effect of equation - 2 is that the site with the minimum cost will have the largest OFM1. The relationship of total costs between sites are retained and the sum of the objective factor measures is one. This is accomplished through the weighting of the OFCs be the sum of the reciprocals of the OFC2 summed over all sites. Raising the result to the power-1 converts the OFM1 to proportions with large values representing relatively more desirable resulting than small values. The subjective factor measure for each site is influenced by the relative weight of each subjective factor and the weight of site ‘i’ relative to all others sites for each of the subjective factors. The results in the following statement. SFMi = ∑k(SFW × SWik) . . . (3) Where SFWk = the weight of subjective factor ‘k’ relative to all subjective factors. and SWik = the weight of site ‘i’ relative to all potential sites for subjective factor ‘k’ 7.4 SUBJECTIVE FACTOR WEIGHT Reference theory is used to assign weights to subjective factors In a consistent and systematic manner. The procedure involves comparing subjective factors two at a time. It the first factor is preferred the second, then the numerical value of 1 is assigned to the first factor and 0 to the second and vice-versa for the opposite result. If it Is difficult to differentiate the two factors,a rating of 1 is given to

both factors. Procedures are also Included for higher order rating. As with the objective factors, the rating are normalised so that the sum of objective weightings for a given site adds to 1. In the preference theory, conclude for each paired comparison about which factor Is more important by judgment. Assign the more important factor a value of 1 and the less important a value of 0. If it is felt that two factors are of equal value assign a 1 to both. Develop a table with the factors In a column at the left and the comparisons to be made across the top. When all combinations of comparisons have been made total the 1's in each row representing the sum of the preference values for that factor. Factor weight is then the factor sum divided by the total preference values for all factors. As a check the sum of all factor weights should be equal to 1. Calculation of SFWk (relative weight to be assigned to each subjective factor) can be summarised as follows. (i) Develop a table with subjective factors in a column at the left. (ii) Take two factors at a time across the top of table. (Ill) compare two factors at a time. (iv) Conclude for each paired comparison which factor is more important by judgment. (v) Assign the more important, factor a value of 1 and the less important a value of 0. (vi) If it is felt that the two factors are of equal value, assign 1 to both. (vii) When all combinations of comparisons have been made, total the 1's in each row (representing the sum of the preference value for that factor). Let this be called as factor sum. (viii) Find the total preference value for all the factors. (ix) Factor sum

Factor weight = Total preference value (x) Check that sum of all factor weight is equal to 1. 7.5 SITE WEIGHTS Determination of site weights for each factor follows a similar procedure. Comparison of each site for each subjective factor must be made one factor at a time. Data rating of each factor for each site serve as a guide for the weighting process. A separate table of comparisons is required for each factor. For example if there are 5 subjective factors to be considered for 6 probable site locations for each subjective factor a comparison table is developed with 6 sites in a column at left and six comparisons to be made across the top. Insert 1's and O's in the table representing the result of comparison. Total the 1's in each row representing the sum of preference values for that site and compute site weights. The result of this procedure gives the site weights for each subjective factor. For this example of 5 subjective factors and 6 sites there will be 30 site weights. Calculation of SWik (site weights) can be summarized as follows, (i) Develop a separate table of comparison for each factor. (ii) Take sites in a column at the left of table. (iii) Take the comparisons to be made across the top of the table. (iv) insert 1’s and O's in the table representing the results of comparisons. (v) Total 1's in each row representing the sum of preference values for that site. (vi) Compute site weights. Site weight =Sum of preference values for that site Total no. of preference values for all the sites (vii) result of this procedure gives the site weights for each subjective factor.

Compute subjective factor measure, SFMi for all the sites using the equation 3. For each site, SFM is the sum of successive multiplication of the factor weights determined previously by the site weights for each factor. As a check the sum of the SFMs should be equal to 1. Compute location measure, LMi for each site. For calculating LMi, decide on the proportion of the decision weight that should be placed on objective factors. Determining objective factor weight is a judgment process. It should be Justified why a particular objective factor decision weight 'X* have to be chosen. The factor 'X' establishes the relative Importance of the objective and subjective factors in the over all location problem. Decision is based on the action by a management committee reflecting policies, past data and an integration of a wide variety of subjective factors. Determination of 'X' could be subjected to a Delphi process.

Calculation of objectives Factor Measure, OFM: OFMi = [OFCix 6∑i=1 (1/OFC)]-1

6∑ i=1(1/OFC)i = (1/28, 237) + (1/29, 275) + (1/29, 266) + (1/29531) + (1/29732) + (1/31334) = 0.0002032 OFM1 = (28,237 × 0.0002032)-1 = 0.17428 OFM2 = (29,275 × 0.0002032)-1 = 0.16810 OFM3 = (29,266 × 0.0002032)-1 = 0.16816 OFM4 = (29,531 × 0.0002032)-1= 0.16665 OFM5 = (29,732 × 0.0002032)-1 = 0.16552 OFM6 = (31.334 × 0.0002032)-1 = 0.15706 Calculation of subjective factor weight SFWk : Preference table for the calculation of SFWk is shown in table - 3. Five subjective factors are taken in a column on left of the table and the ten possible pairs are taken across the table. The preference values are given based on judgment. For example when the availability of labor and availability of transportation (L&T) is compared. It was felt that availability of labor is more important for the plant to located and hence a preference value of 1 is given to labor and 0 for transportation. When the availability of labor and recreation facility (L&R) are compared it was felt that both the factors are important for the plant to be considered. So a preference value of 1 is given to both these factors. In the similar way all the combinations are considered and the preference values are assigned. The total preference value for all the factors (sum of all 1’s in Table-3) is 16. 1’s in that row of table-3) comes to 4 and it is called as ‘factor sum’. Therefore the factor weight for the factor is obtained by dividing factor sum by the total preferred values. This is calculated as 4/16=0.25 for the ‘labor’ factor in table-3. Similarly SFWk is calculated for all the subjective factors. It can be checked that the sum of all the SFWk comes to 1

Calculation of site Weight, SWik : Separate preference tables have to be developed for each subjective factor. Therefore there will be five preference tables for the five given subjective factors and these are given in tables 4, 5, 5, 7 and 8.

Location measure for site 5.LM5 = 1 × [(0.8 × 0.16552) + (0.2 × 0.1755)]= [(0.1324 + 0.035)] = 0.1675Location measure for site 6,LM6 = 1 × [(0.8 × 0.15706) + 0.2 × 0.1755)]= (0.1256 + 0.0351] = 0.1607 It can be checked that the sum of the location measure for all the sites take a value of approximately one. It can be noted from the LM1 values that site-1 is selected for locating the new plant for this example. Sensitivity analysis can be conducted to indicate how decisions would change when the objectives factor decision weight ‘X’ is varied from 0 to 1. From the sensitivity study it can be revealed that which site will be preferred for what range of ‘X’ 7.7. Summary The emphasis in industrial plant location is to minimise costs; however when considering long-run cost and many intangible factors it may influence future costs. Thus, a manager is faced with making trade-off between tangible cost in the present and the subjective factors that may influence future cost. The Brown - Gibson model provides a frame work for the integration of objective and subjective factors using preference theory to assign weights to factors in consistent manner. 7.8. Key concepts Critical factor measure Objective factor measure Subjective factor measure Objective factor decision weight Location factor measure Preference theory

7.9 Model Questions 1. In the Brown - Gibson location model how is a critical factor weighted? 2. How the objective factor is weighted in a Brown - Gibson location model? 3. In the Brown - Gibson model what is the rationale for weighing subjective factors? 4. In the Brown-Gibson model how are the relative weights between objective and subjective factors determined in the overall location problem? 5. Are location choices sensitive to relative weights between objective and subjective factors in a Brown - Gibson location model? 7.10 REFERENCE BOOKS 1. Buffa, "Modern production management", 4th edition John Whiely. 2. Menipaz, Ehed, "Essentials of production and operations management". Prentice Hall 3. Buffa. "Modern production/operations management". 7th edition. John Whiely.Home Go to Active LR Sitemap 361 DM Wall Logout Copyright © 2006-2010, Threesixtyone Degree Minds Consulting Pvt Ltd. All Rights Reserved.Privacy | Legal

LESSON-8

MULTI-PLANT LOCATION 8.1 Preamble 8.2 Location analysis for multi-plant situation

8.3 Linear programming-distribution method 8.4 An example 8.5 Locational dynamics 8.6 Summary 8.7 Key concepts 8.8 Model questions 8.9 Reference books 8.1 PREAMBLE Location analysis for multi-plant situation is particularly interesting because of it's dynamic character. The addition of new plant is not a matter of determining a location independent of the location of existing plants. Rather, each location considered involves a new allocation of capacity to market areas, so a solution from the economic view point is one that minimises combined production and distribution cost for the network of plants rather than for the additional plant alone. Also in the multi-plant situation, locational factors continually influence the extent of production in each plant to meet demand requirements and help determine which plants to operate and which to shut-down if demand falls. 8.2 LOCATIONAL ANALYSIS FOR MULTI-PLANT SITUATION Multi plant location is influenced by existing locations as well as the kinds of economic factors that have been discussed already. Each location considered must be placed in economic perspective with the existing plants and marked areas. The objective factor measures focus on the minimizing of total production - distribution costs. This aim is somewhat different from the location analysis for a single plant, because each alternate location requires a different allocation . of capacity to markets in order to minimize overall costs. The formal problem can be placed in a linear programming framework and solved in a distribution table.

Before taking an example on multi plant location, the linear programming-distribution methods can be briefly discussed. 8.3 LINEAR PROGRAMMING-DISTRIBUT1ON METHOD There are two major steps in the method,(i) Finding basic feasible solutions.(ii) Testing the solution for optimality and improving it,if not optimal. Finding Basic Feasible solution Before attempting to find the basic feasible solution. it should be checked that the total availability in all the plants must be equal to the total requirement of all the warehouses. If it is not equal add a dummy row or a dummy column correspondingly with zero distribution cost there are three methods in finding the basic feasible solution. (i) North-West comer rule, (ii) Minimum cost methods, (iii) Vogel's Approximation method. Out of three methods.Vogel's methods is more efficient because the optimal solution would be obtained in a comparatively, lesser number of iterations. If the basic solution is obtained from Vogel's method. Steps to be followed In Vogel's Approximation method (i) For each row and column of the distribution side, select the lowest and second lowest cost alternatives form among those not already allocated. The difference between the two costs will be the penalty cost for the row or column. If the lowest and second lowest cost element happens to be the same, then the penalty cost is zero. (ii) Scan these penalty cost figures and identify the row or column with the largest penalty cost. If there is a tie, in the largest penalty cost. Choose any one among the tied values. (iii) Allocate as many units as possible to this row or column in the all having the least cost. (iv) Now delete the row or /and Column in which availability has

been exhausted or/and requirement has been met. (v) For the reduced distribution table repeat the steps (i) to (iv) until the total availability has been exhausted and total requirement has been met. Testing the solution for optimality and Improving it, lf not optimal Before testing the basic feasible solution for the optimality .the following condition must be satisfied. Total number of allocations = m + n-1 where m = Total number of rows. n = total number of columns. If this condition is not satisfied, add an allocation with units such that (epsilon) is a infinitely small quantity. Whatever quantity is added or subtracted to or from this the result will be the same quantity which is added or subtracted. This is added in the distribution table in the all such that (i) the cost in the cell is the least possible. (ii) If this is added in a square, It should not form a close loop with other allocation. A loop can be formed by drawing horizontal and vertical lines among the allocated cells. If an allocation exist in all corners of this loop, then it is called a closed loop. After satisfying the above condition the basic solution is tested for optimality. Two methods can be used for this purpose.They are (i) MODI (Modified Distribution Method) Method (ii) Stepping stone Method. Among these two methods, MODI method is explained below. Steps to be followed in MODI, method (i) For the basic solution, compute ‘U1’ values (Corresponding to rows of the distribution table) and Vj values (Corresponding to columns of

the distribution table) for the distribution table using the formula. Cij = Ui+vj

Where Cijfor the cell (ij) (ii) Take ui = 0 for the row which is having maximum number of allocations. If there is a tie take u1 = 0 for any row. (iii) Calculate the cell evaluation for all the unallocated cells using the expression. ij = cij- (Ui - Vj)

(iv) a. If none of the cell evaluations are (-) ve the solutions is an unique optimal. b. If none are (-) ve and there are zero entries then it means that there are more than one optimal solution. c. If there are (-) ve entries for cell evaluations then the solution under test is not an optimal one. When the outcome (iv) it is obtained the solution have to be improved for getting optimality. The following steps are followed for improving the solution for optimality. (v) Choose the cell having the largest negative entry in the cell evaluation. (vi) Trace a closed path with the cell having largest negative cell evaluation. (vii) Place plus and minus signs at alternate corners of the path beginning with in plus sign at the unused square. (viii) The smallest cell in a negative position on the closed path indicates the quantity that can be assigned to be unused cell being entered into the solution. This quantity is added to all squares on the closed, path with plus sign and subtracted from those squares with minus sign. (ix) Now repeat from step-(i) until an optimal solution has been obtained.

This total availability in all the four plants A, B C and D is 120 units which is equal to the total required at all the distribution centers v, w, x, y and z. So there is no need to add dummy row or column. The

Vogel’s approximation method is applied and the basic feasible solution is obtained in table 1 1. Before testing this basic solution for optimality the following conditions have to be satisfied. Total number of allocations = m + n-1. Where m = Total no. of rows. n = total no. of columns. From the basic solution obtained in Table 1 1, total number of allocations are S which is equal to (4+5-1) Now MODI method is applied in Table 12 to test the solution for optimality. From the table 12 it can be noted that the solution is not an optimal one because there are negative entries in the cell evaluation. The most negative entry is -18 and hence a close loop is formed with this cell. Following the steps of MODI method the number of units that can be allocated to the new cell is 16. The next iteration is given in table 13. The solution obtained in table 13 is also not an optimal one since there are negative cell evaluation entries. The next iteration is given in table 14. Since all the cell evaluation entries in table 14 are non-negative, the solution obtained is an optimal one. Therefore the optimal total production and distribution cost for the first combination with plant I) is, Total cost = (30 × 288) + (16 × 282) + (20 × 307) + (18 × 287) + (4 × 291) + (12 ×319)+(15×264)+ (5 × 293) = Rs.34,875 The LP Distribution problem for the second problem for the combination of including the new plant E can be formulated and solved in a similar way. The final optimal solution is shown in table 15. Total production and distribution cost for the second combination is Rs.34.411. The LP distribution problem for the third combination of including the new plant F can also formulated and solved. The final optimal solution is shown in table 16.

Total production and distribution cost for this third combination is Rs.34.850. The three solutions of the LP distribution problems shows that the J*(ew location at 'E' is favorable, since the location at E results in the

lowest production and distribution cost. The combined production-distribution analysis provides input concerning the objective factor cost in the Brown-Gibson location model. Subjective factors are evaluated as before. Final decision would be based on both objective and subjective factors and relative weights are placed on them. 8.5 LOCATIONAL DYNAMICS FOR MULTI PLANTS Suppose that the company decides to build a new plant at location E. The decision to build the new plant at location E was based on current costs and demand. However the balance of cost factors that produced the solution shown in Table 14 could change. Then the allocation of capacity to markets should also change in order to yield a minimum total cost. Thus location analysis is a continuous consideration rather than a one-shot analysis performed only at the time of expansion. Assume that after the plant at location E was built, the company experienced a net decline in demand because of the entry of aggressive new competitions in the market. Instead of a total demand of 1,20,000 units as projected in the original locational analysis only 1,05,000 units are required. The result is that any three of the plants can meet the demand by using overtime capacity. The company is now faced with comparing the objective and subjective factors of five production-location alternatives. The five alternative are: operate all plants at partial capacity plus four additional alternatives that each involve (Shutting down one of the plants and meeting requirements using the other three plants operating on overtime schedules. In order to compare the alternatives, five different linear programming distribution tables would be developed. In order to keep the alternatives involving overtime capacity wishing the linear programming framework the overtime capacity would be regarded as a separate source of supply. In actual shipment units produced on overtime would be segregated. Overtime capacity would simply result higher costs of production.

Five optimal production-distribution tables would be generated and the variable plus fixed costs of operations are compared for the five alternatives. The alternative with the lowest cost would be the one favored on the basis of objective factor costs. The final decision would necessarily be influenced by both objective and subjective factors, because the plant shutdown has a number of important effects on employee and community relationships.

Please use headphones 8.6 SUMMARY Location analysis for multi plant situation have been discussed. Application of Linear Programming Distribution method in multi plant location situation have been elaborated. An illustration example is given on choosing a location for multi plant situation. Some of the plant location trends are narrated. 8.7 KEY CONCEPTS Linear Programming-Distribution MethodVogel's Approximation MethodModi MethodLocational DynamicsPlant Location Trends. 8.8 MODEL QUESTIONS 1. How is the problem of locating a single plant different from locating an additional plant which manufactures the same items as existing plants? 2. What do you mean by 'locational dynamics' for multiple plants? 3. A company supplies its product from three factories to five distribution centers. The company Is experiencing increasing demand for its product and considering the construction of a 'new plant with a capacity of 40,000 units. Survey has narrowed the choice to three locations. The relevant data is summarised In the following table.

Formulate the problem in a distribution framework and find the optimal solution.

DISTRIBUTION COST PER 1000 UNITS TO DISTRIBUTION CENTERS IN RUPEES

PLANT CAPACITIES • 1000

PRODUCTION COST PER 1000 UNITS IN RUPEES

V

W

X

Y

Z

EXISTING PLANTS

ABC

364844

338024

247232

566096

1008488

924068

540532 552

PROPOSED PLANTS

DEF

80110 100

80140 100

7212892

464 28

64840

40 4040

524540520

MARKET DEMAND • 1000,

60

36

40

30

74

-

-

4. A company has established plants In A and B. The assembled products are sent to customers In XY and Z. The plant at at that a capacity to assemble 50 products. The plant at B has the capacity to assemble 70 products. Cost of transportation from A is Rs.1000 to X, Rs.1500 to Y and Rs. 300 to Z. Transportation from B is Rs.600 to X. Rs.500 to Y and Rs.900 to Z. The demand for product is 40 in X, 50 in Y and 50 in Z. The company is going to build another plant with the capacity of 20 products in either P or Q. From P transportation cost is

Rs.600 to X, Rs. 500 to Y and Rs. 300 to Z. From Q transportation cost is Rs.200 to X, Rs.400 to Y and Rs.500 to Z. (a) Setup this problem as a distribution model. (b) What are the steps involved in solving the location problem. 8.9 REFERENCE BOOKS 1. Buffa, "Modern production management", 4th edition John Whiely. 2. Menipaz, Ehed, "Essentials of production and operations management", Prentice Hall 3. Buffa, "Modern production/operations management". 7th edition, John Whiely.b

END OF CHAPTER

LESSON-9

PLANT LOCATION TRENDS

9.1 Preamble 9.2 Significant trends 9.3 Geographical Diversity 9.4 The growing Sunbelt 9.5 Decline of urban areas 9.6 Intel-nationalization of production

9.6.1 Environmental adjustments 9.6.2 Exporting techniques 9.6.3 Organizing multi-nationally 9.7 Summary 9.8 Key concepts 9.9 Model questions 9.10 Reference books 9.1 PREAMBLE The overall trends in location patterns are recognized to have strategic impact on location decisions. Examples in this lesson are with respect United States. 9.2 SIGNIFICANT TRENDS It is fascinating to watch the changes In location patterns, which reflect changes in strategy. McDonald's had an urban strategy, but now is locating stores in some low-population centers. Holiday Inn followed a rural strategy but now is adding more units in urban locations. The steel industry is more dispersed than before. High-tech electronics firms are clustered to achieve a critical mass, but these concentrations are scattered across the country. Four location trends are particularly evident - geographic diversity, movement to the growing Sunbelt, movement from declining urban areas, and the internationalization of production.

9.3 GEOGRAPHIC DIVERSITY There are two causes of this trend. The first is improved transportation and communication technology. There has been a dramatic reduction in time to ship goods from Osaka. Japan, to Kansas City. Air transportation also makes It easier for executives to visit branch plants. Telephone technology facilities both voice communication between people and data communication between computers. The number of out-of-state phone calls doubled in one decade, standing at over 6 billion in 1980. This reduces the "friction of distance", so that a facility can service a larger market area and need not be close to its suppliers,. In service industries, more back-room operations can be centralized at home offices, which can support a wider network of branch offices located near the customer. ' The second cause of geographic dispersion, which widens the range of acceptable locations, is the narrowing of regional wage differentials. The Pacific region has enjoyed the highest income per capita, while the south has suffered the lowest. In 1960, per capita income in the Pacific region was 120 percent of the national average, while in the south it was only 78 percent. However, by 1980, per capita income in the Pacific region stood at only 111 percent and the south moved up to 89 percent of the national average. The 42 percent difference dropped to 22 percent in just 20 years. 9.4 THE GROWING SUNBELT Industry has tended to move south and west, away from the "Frosbelt" and into the "Sunbelt". Fig. 9.1 shows how manufacturing employment shifted among regions from 1967 to 1977. Frostbelt employment decreased noticeably, particularly in the New England, mideastern of Great Lakes regions. For example, the Great Lakes share of 28.3 percent of total manufacturing employment in 1967 dropped to 27.1 % in 1977. The sunbelt regions compensated for these losses with 1-2 percent gains. Several factors contribute to this movement Reduced transportation and communication costs are two important factors, reducing the necessity for staying in the industrial heartland of the

Great Lakes and mideastern regions. Some parts of the sunbelt offer lower labor costs, less unionism, and possibly a stronger work ethic. The advent of air conditioning and the increase in paid retirement have also favored the Sunbelt. Manufacturing has been concentrated in the Frostbelt, and manufacturers are reluctant to relocate their support and R & D activities. Sunbelt plants therefore tend to focus more on a specific product or process, allowing high volume production, with products tending to be in the mature stage of their life cycles. This strategy takes advantage of labor cost differences, leaving products that are in their early stages for the Frosbelt plants and closer to R & D support activities. Figure 9.1 also shows forecasts of population changes between 1980 and the year 2000. Once again, we can see that the sunbelt is attracting a larger share at the expense of the Frostbelt. However, these projections should be viewed with caution. Population increases do not always bring large numbers of new businesses to an area. Rapid growth in areas with a low population base, for example, has little Impact on location decisions, particularly for large retail chains.

9.5 DECLINE OF URBAN AREAS Manufacturing plants have also moved from the cities to rural

areas. A similar shift can be seen in Japan and the Industrialized countries of Europe. Over 50 % of the new Industrial jobs in the United States during the last 2 decades went to rural areas- in all regions. Rural areas gained manufacturing employment even in the mideastern states. Gains have been particularly impressive in the southeastern and south central regions. Reasons for this shift include high crime rates and general decline of the quality of life in many large cities. Office location decisions are following suit. For example, IBM moved its corporate office from New York City to nearby Armonk, Ex-cell-O Corporation moved from Detroit to nearby Troy, and Brunswick moved from Chicago to Skokie. 9.6 INTERNATIONALIZATION OF PRODUCTION Between 1976 and 1983, direct investment abroad of private U.S. assets increased from $136.8 billion to $226.1 billion, a 65 percent increase. At the same time, direct Investment of private foreign assets in the United States jumped from $30.8 billion to $133.5 billion, a 333% increase. Many U.S. manufacturers also rely increasingly on foreign suppliers. Of the 20 most strategic materials, 17 are imported from 4 countries in southern Africa. Wage-rate differentials, expanding foreign markets, and improved transportation break down the barriers of time and space between countries. Having a local presence, with the product made where it is to be sold, can increase sales or decrease the threat of quotas. The result is a more linked world economy. This trend with some specific companies is illustrated below. Illustration: Internationalization of production Locating Overseas Accuracy is a manufacturer of process control equipment headquarted in Columbus, Ohio. It is doubling its plant and work- force size at its plant in Ireland. One-third of its shipments are now finished at the Irish plant. AccuRay is one of 400 U.S. companies now operating in Ireland where there is a skilled and low work-force. Ford motor company moved the production of agricultural tractors from its Michigan plant to its plants in Belgium and England. Lower wage costs, the strong U.S. dollar, and the ability to consolidate

production volumes saved enough to offset shipping costs to the U.S. Caterpillar tractor company shifted the production of bulldozers from Illinois and Iowa to Scotland, where more than 1000 Scots are now turning out bulldozers. Influx of Foreign Firms Several Japanese firms are locating production facilities in the U.S. Honda located an automobile plant in Marysville, Ohio, with a work-force of 2300. Mazda is building a plant in Flat Rock, Michigan and will employ 3500 workers. Nissan motor company expanded its plant in Smyrna. Tenessee, to make the Sentra passenger car in addition to light trucks. These three facilities alone will have a capacity of 7,80,000 cars and trucks per year. Moreover a Joint venture between Toyota and GM resulted in a new assembly plant in Freemont, California. Four Japanese Electronics companies (NEC, Fujitsu, Seiko and Kyocera) are building five manufacturing plants in the Portland, Oregon area. They will manufacture such products as personnel computer printers and advanced fibre optics telecommunication equipment. The Le Blont company has made metal working lathes since 1877. It is now called the Le Blont Makino, after Japan's Makino milling machine limited bought 51% interest in the company. Le Blont makes a wider range of products than before and is much more international. It has now a plant in Singapore and selling lathes made by a German firm. The machining centers assembled at its home basing Cincinnati, Ohio will have half U.S. and half Japanese parts and labor. Despite the advantages of more international production, a new set of problems arises, including differences in language, politics, and culture. Many firms are poorly equipped to handle these differences. For example, few U.S. managers know a foreign language. There are more English teachers in Russia than students studying Russian in the U.S. Such problems create three recurring issues for managers of international production:

(i) Environmental adjustment (ii) Exporting techniques (ill) Organizing multi-nationally 9.6.1 Environmental adjustment: The overseas plant confronts the manager with unfamiliar labor laws, tax laws, and regulatory requirements. The role of government in foreign countries can be more dominant, requiring know-how to handle bureaucratic red tape. Hiring a foreign national to handle government contacts is not without problems, since this person is not well-versed on the firm's own policies and procedures. The economic environment can. also be quite different. What seemed to be good policies on automation or inventory may be inappropriate overseas because of a different cost mix. Cultural differences are perhaps the most baffling. Foreign nationals comprise the work force and often much of the management team at an overseas plant. Their values, customs, and attitudes toward work can collide with policies adopted at the home office. These employees may not be sympathetic to what they consider to be strange approaches and may resist change. 9.6.2 Exportingtechniques: A second recurring issue is that of how much of the corporation's production methods to transplant overseas. If a firm totally accepts the approaches of the foreign managers and workers, some effective techniques and policies may be overlooked. The other extreme can be as bad, since some techniques and policies may not fit the new environment. Some compromise between the two extremes is normally best. For example, Mc-Donald's menu (that is, its product plan) and restaurant layout are the same in Japan as in the United States. However, sites are selected and restaurants are built closer to

adjoining buildings with Japanese preferences in mind. The chain's trademark character is named Donald McDonald (rather than Ronald McDonald) because it is easier to pronounce. 9.6.3 Organizing multi-nationally: Having multiple plants always raises the question of how much control the home office should retain. Language, cultural, and economic differences make this question that much more crucial for international operations. The home office can provide technical specialists to make decisions about equipment, inventory systems, quality control procedures, and the like. Such centralized control fits the strategy of doing things "our way" and can improve interplant coordination. The decentralized strategy of giving local managers more autonomy has its own advantages such as adapting policies to local conditions, preserving incentives at lower levels and minimizing the cost of large central office.

Please use headphones 9.7 SUMMARY Location decisions have strategic implications. Four trends in location patterns are geographic diversity, the growing, sunbelt, the decline of urban areas and the Intel-nationalization of production. Despite the advantages of international production differences In language, policies and culture introduce new problems. Three recurring issues are environmental adjustments, exporting techniques and organizing multinationality. 9.8 KEY CONCEPTS Geographic diversity Growing sunbelt

Urban areas Internationalization of production Environmental adjustment Exporting techniques Organizing multinationality

9.9 MODEL QUESTIONS 1. What factors have expanded the range of possible locations? 2. What are the attractions of the sunbelt or manufacturing plants? 3. What can make foreign locations attractive? 4. Why does an overseas location confront a manager with a different set of problems? 5. Explain about Intel-nationalization of production. 9.10 REFERENCE BOOKS 1. Krajewski and Ritzman, "Operations Management", Addlson-Wesley. '

END OF CHAPTER

LESSON-10

LAYOUT OF FACILITIES

10.1 Preamble 10.2 Principles of a good layout 10.3 Plant layout factors 10.4 Basic types of layout 10.5 Determining what to move 10.6 Process layout 10.7 Product layout 10.8 Hybrid layout 10.9 Fixed position layout 10.10 Quantitative analysis for process layout 10.11 Quantitative analysis for product layout 10.12 Service facilities 10.13 Principles of materials handling 10.14 Materials handling equipment* 10.14.1 Lifting and lowering devices 10.14.2 Transporting devices 10.14.3 Combination devices 10.14.4 Common material handling equipment 10.14.4.1 Conveyors 10.14.4.2 Cranes, Hoists, Monorails 10.14.4.3 Industrial trucks 10.14.4.4 Auxiliary equipment 10.15 Summary

10.16 Key concepts 10.17 Model questions 10.18 Reference books

10.1 PREAMBLE Plant layout is the integrating phase of the design of a production system. The basic objective of layout is to develop a production system that meets requirements of capacity and quality in the most economical way. The specification of what to make (drawings and specifications), how it is to be made (route sheets and operation sheets) and how many to make (forecasts, orders or contracts) become the basis for developing an integrated system of production. This integrated system must provide for machines, workplaces and storage in the capacities required so that feasible schedules can be determined for the various parts and products. The system should also provide a transportation system which moves the parts and products through the system. It should provide auxiliary services for production such as tool cribs and maintenance shops and for personnel such as medical facilities and cafeterias. Because of the dynamic character of our economy, the design of this integrated production machine must retain an appropriate degree of flexibility to provide for future changes in product designs, product volumes and mixes and for advancing production technology. Both the site and building should make it possible to expand operations in a way that dovetails with existing operations. Certain financial and physical restrictions are a normal part of the layout problem. The physical restriction may be due to the site: its size, shape and orientation in relation to roads, railroads and utilities. Or they may be due to local laws which specify building restriction and safety codes. In redesign or relay out of facilities the existing building Impose severe restrictions. These general statements of the layout problem indicate something of its complexity. Almost all of the factors which enter the problem tend to interact. For example, providing flexibility affects the nature of processes and capacities which in turn interact with short and long run costs. Material transportation methods affects not only transportation costs but also the amount of handling at machines and workplaces. The physical arrangement and relative location of work centers are Important in determining transportation costs and direct

labor costs. Storage locations and capacities interact with transportation costs and delay times. 10.2 PRINCIPLES OF A GOOD LAYOUT An optimum plant layout is one which provides maximum satisfaction to all parties concerned; that Is the employees and management as well as the stock holders. Each of the parties involved has certain interest in obtaining a good plant layout. Keeping this interest in mind the major principles of a good layout are: (I) provide over all simplifications (II) minimise cost of materials handling

(ill) provide high work-in-process turnover (iv) provide effective space utilisation (v) provide for worker convenience and promote Job satisfaction and safety (vi) avoid unnecessary capital investment (vii) stimulate effective labor utilisation Simplify the productionprocess This is the broadest objective in obtaining a good layout. A good layout should be planned to facilitate the over-all manufacturing process so that it can be carried on in an optimum manner. More specifically, simplification may come from the following: a. Equipment should be arranged to provide greater utilisation.

Equipment involving high capital inventory should be located so that it can be conveniently used on a multiple- shift basis. Material handling equipment, like conveyors should be located so that a group of products can utilise it conveniently. b. A good layout will minimize production delays and reduce congestion, production delays may be reduced or eliminated by good line balancing. Provision of proper amount of storage space reduces congestion on the floor. c. Good plant layout allows for the needs of maintenance of equipment. Equipment must be located so that routine maintenance is easy to perform. Good layout calls for prediction of future maintenance problems. d. Increasing output or shortening manufacturing time can be provided in an improved layout. Increased output means greater output with the same or less cost, saves the man hours and reduce machine hours. Manufacturing time can be reduced by eliminating idle time and removing unnecessary storages. Minimizing Materials Handling In a plant the production machines should be arranged such that the materials pass directly from one machine to another. Material handling is brought to a minimum by this arrangement of machines. In many situations manual material handling is most economical. Even in this situation reducing the distances required for manual material handling should be considered when planning. Providing high work-in-process turnover Every day material remains in the plant and adds cost to the product because of the tied-up capital investment. In the process industries, for example, in a petroleum refineries where the product is in the liquid state, work-in-process turnover is high and unnecessarily in-process stages are reduced to a minimum. When the product is in the solid state, it is much more likely to involve a high capital investment in work-in-process. Although this is primarily a production control problem, good layout can be helpful in reducing work-in-

process. Effective space utilisation Making good use of space involves considering not only production and storage areas, but also the floor area required by service departments. Stock bins spread out on only one level, idle aisles, and unorganised storage areas are all lead to poor space utilisation. The cost of floor space varies from one location to another location but considerable thought have to be given for accurately calculating floor area cost. Worker convenience and Job satisfaction Workers want to work in a convenient environment. Providing the worker with a place to leave his tools and with easy access to materials storage, reducing excessive noise with sound- deadening walls, as well as considering his safety are factors that should be examined when planning a layout. Attention to such items as heat, ventilation, light and removal of moisture and dirt is important in promoting worker's job satisfaction. Layout that calls for unstable stacking of materials should be changed to correct safety hazards. The layout engineer should keep close contact with the safety engineer in order to assure that safety has been thoroughly considered in a given layout. Unnecessary capital Investment Capital investment in equipment can sometimes be reduced by the proper arrangement of machines and departments. By conveniently locating a particular piece of equipment. two different parts, both requiring part-time use of a broach, may be routed through the same broach. Thus the cost of a second machine is avoided. During the process planning phase capital investment can be minimized by making use of idle time on previously owned equipment. This type of problem is primarily one of the production scheduling, but by being aware of the problem the layout man can facilitate production scheduling by installing a good layout.

Labour utilisation Every year so many productive man-hours are wasted because of poor layout. Proper layout does not guarantee but certainly stimulates the effective utilisation of man power. The following suggestions should be considered in making effective utilisation of labour. a. Direct labour utilisation: Improper layout can make the production job extremely wasteful. Making it necessary for the production worker to walk great distances to obtain tools or materials can waste a number of man hours. Good methods engineering and line balancing can minimise worker idle time. b. Indirect labor utilisation: Building design to provide ease of maintenance can save many rupees per year. Proper design of aisles can result in better utilisation of fork-lift operator. c. Better supervision: A supervisor should theoretically be in contact with his department at all times. An enclosed office should be provided for a foreman with direct line authority. This is essential when a foreman finds it necessary to discipline a subordinate. 10.3 PLANT LAYOUT FACTORS Everyone with in an industrial organisation is concerned with plant layout in some way and everyone within a plant is interested in its layout to some degree. The worker is interested in the arrangement of his work station. The foreman is interested in layout as it affects the output of his department. Middle management is interested in layout as it affects the output and costs. Suggestions that result in plant

layout thinking may come from anyone in the organisation from the director to the production worker. Most plant layout decisions are stimulated by one of the following factors.(i) product-design change(ii) new product(iii) change in volume of demand(iv) facilities becoming obsolete(v) frequent accidents(vi) poor working environment(vii) change In the location or concentration of markets(viii) cost reduction Product-designchanges Automobile models are radically changed frequently which usually require a change In plant layout. A full time plant layout department is essential in an automobile industry. In industries manufacturing a more stabilized product, plant layout may not be a crucial problem. These concerns must solve the plant layout problems whenever a product change comes even though it may occur infrequently. New product The addition of a new product as well as the dropping of an old one is a development which results m thinking about the plant layout problem. Progressive companies are continually on the alert for new product developments. Research and development departments are continually providing new products for the industrial or home consumer. As these products come to the production-planning stage plant layout should be integrated with the planning of the production processes. Changes In the volume ofdemand An increased demand for a product may result in the revision of a present plant layout. It may result in the planning of a completely new plant. A decreased demand for a product may also result in plant layout changes.

Facilities becoming obsolete Plant layout problems are often created by the obsolescence of industrial equipment, processes and buildings. Equipment replacement results in only minor changes in a present layout. On the other hand, when an industrial process becomes obsolete, changes in plant layout are usually-demanded. Buildings that become obsolete, whether because of size limitations or some other reason, may result in plant expansion of present building, the building of a new plant or a move into a new building. Any one of these alternatives involve considerable plant layout work. Frequent accidents Hazards to safety must be forseen while designing good plant layout Where-electric welding is a part of an industrial process, shields or screen must be provided around the arc-welding production centers in order to prevent injury to the eyes of personnel in surrounding areas. Aisles should be designed so as to minimise the possibility of accidents caused by materials handling equipment. Poor working environment Worker complaints regarding working conditions such as noise or changes in temperature, may be resolved by changes in plant layout. Providing the worker with easy accessibility to materials, tools and instructions are considered in good plant layout A layout which considers these factors helps to establish the reputation of a firm as being a good place to work. Change In the location or concentration of markets Changes of market locations lead not only to plant layout problems but often make plant location studies necessary. Often the planning of a completely new plant is the answer to changes in market location.

Cost reduction Cost reduction is a general term indicating management's device to reduce any one of the numerous costs involved in operating an Industrial concern. Since the time of the Industrial Revolution it has been one of the most vital of all the considerations in manufacturing industries. It must continue to have top priority if productivity curves are to continue upward. Costs can be reduced in many ways. New materials develop which can be substituted for expensive materials. The development of a faster production process can reduce the inventory tied-up in work-in process Inventory. Improved layout is synonymous with improved methods. In addition, improved plant layout can result in the reduction of cost brought by better utilisation of buildings, tools and equipment. With automatic factory on its way .the costs of maintenance will rise rapidly compared to the-costs of production. Proper layout can facilitate maintenance procedures and thereby achieve cost reductions. 10.4 BASIC TYPES OF LAYOUT Layout choices must closely be tied to higher level decisions. Several fundamental strategic choices must be made in layout planning. 10.5 DETERMINING WHAT TO MOVE Production consist of combining and manipulating men. materials and machines. These elements may be combined in various ways during production activity. The proportion In which these elements will be used depends on their relative cost and on the production process selected. Before laying out a plant it is necessary to determine which of these elements are to be fixed and which will be mobile during the process of production. Various alternatives are available in determining which factor to move. (i) to move the product and worker from one workstation to another workstation (ii) to move the product from one workstation to another

workstation, keeping machine and worker stationary (iii) to move the worker and the machine to the product which is held at one locationThe decision as to which arrangement to employ depends on the relative mobility of each factor In plant and on the comparative cost of each method. The first method that is moving both product and worker from machine to machine is not very common in modem production. It is-employed in some job-lot production plants turning out custom- made products, worker moves with his work from machine to machine usually operating a limited variety of machines. The second method is common in the manufacture of standardised products. Product moves through machine work stations and continuous process equipment which are fixed to locations and attended by workers. Example is the flow of materials in any automobile manufacture.

In the third arrangement the worker and the machines are brought to the materials. Manufacturing operations producing bulky products as large steam turbines, boilers, generators, locomotives and ships. Fabricated and assembly of smaller parts are usually carried out under the first and second arrangement. There are many instances where the machining of large castings and other parts of the product is dene by portable machine tools which are brought to the product In most manufacturing concerns producing standard products and custom made products employs the first two alternatives. 10.6 TYPES OFLAYOUT This is designed for the non-repetitive, intermittent types of production where special orders are handled. In process grouping similar processes or equipment are grouped together. When strategy calls for process focus, resources (employees and equipment) must be organised around the process. A process layout accomplishes this purpose by clustering in one center the resources that perform similar functions. For example all grinding is done in a grinding department, all drills are located in the same area of a shop and all bills are processed in an accounts payable section. This format is most commonly used when many different products (customers) must be

produced or served intermittently at the same work stations. Demand levels are too low or unpredictable to allow human and capital resources to be set aside exclusively for a particular product line or type of customer. Resources are relatively general purpose, flexible and less capital intensive.

The process layout is less vulnerable to changes in product mix or new marketing strategies. Employee supervision can be more specialised which is important when the job content requires a good deal of technical knowledge. A block diagram of process layout arrangement is shown in fig. 10.1. Advantages of process layout (i) Lower capital investment: Less capital is needed because production machines will be utilised to greater capacity. Machine can be kept in operation most of the time. Equipment is highly productive.

(ii) Wide flexibility in production facilities: Greater variety of jobs can be handled on a comparatively small investments because of utilisation of various types of general purpose equipment. Each machine can perform a wide range of similar kinds of operations. Moreover there is flexibility in planning production. Jobs are scheduled for a department as a whole. So it is possible to assign work to any available machine in the given department. (iii) Effective supervision readily achieved: Each foreman supervises only a limited range of machine operations like foreman over welding, grinding and so on. Because task for each foreman is not too diverse, he becomes highly proficient in time and with practice. He is able to direct the setup and performance of every kind of operation done on the equipment. He also becomes expert in maintenance and repair of equipment, inspection requirement and planning and production control of his department. (iv) Machine failures do not seriously disrupt production schedules: Industrial machine break-downs do not hold up subsequent operations. If there is break-down in one machine in a department the work can be easily transferred to another machine in the same department. Disadvantages of process layout (i) More material handling: There will be no definite channels through which all the work will

flow. Work, in-process, may return to the same department more than once for processing and this makes backtracking of work making higher cost of materials handling. (ii) Greater total floor area required:

A greater proportion of the floor space is required for service activities which result in a lower proportion of total plant area being devoted to actual production activities. There is greater need for aisles, temporary storage at each department. All of these need more floor space per unit of product turned out. (iii) Higher skilled labor and difficulty in labour procurement: Workers must be skilled because they operate a number of general purpose machines doing a variety of jobs. More highly skilled labour is required and wage rates will be usually higher. Further there may be difficulty in procuring such labor on short notice. (iv) Need for more frequent inspection: Inspection is generally necessary before the work goes to the next operation in another department. Strict departmental responsibility for quality of work turned out is the main reason for the need of inspection in each department. Subsequent rejection of material by another department causes a considerable amount of handling, confusion and rerouting to rework the faulty part. (v) Longer processing times: Total time needed for processing production orders under process layout is greater than that required in product layout. More time is consumed because work necessary for loading the machines must be

delivered to each department and after processing work is to be held for inspection. More over large amount of materials handling is necessary between departments. It is difficult to co-ordinate material handling because personnel cannot always be made available to move when it is released from a department. The end result is longer period of processing time. Process layout is suitable for intermittent production. It is employed when the same facilities are used to fabricate and assemble a wide variety of parts when part and product designs are not stable. From historical point of view process layout preceded product layout. Any considerable growth in demand for product of any industry gradually makes advisable the conversion of layout in part or whole from process to product. A gradual transition from process to product layout may take place as demand increases for products. Product layout is introduced first either.-in parts of fabricating activities or in assembly operations. The complete product layout arrangement is finally introduced to whole production process. 10.7 PRODUCT LAYOUT Equipment needed to fabricate or assemble the product is brought to-gether and setup in accordance with the required sequence of operations as shown on the process chart. Material flows through the predetermined channels of operations from the receipt of raw materials to fabrication of various component parts to final assembly. Product layout is designed for the flow type of production where continuous or repetitive operations are carried on to produce large quantities of a standardised product. Under product grouping all the machines needed to produce part or subassembly are arranged sequentially in a continuous line in the order in which the successive operations on the product must be performed. The part flows from machine to machine moving a short distance at a time until all required operations are completed. This arrangement results in processing of the product in a forward flow from the receipt of raw materials to shipment of finished product. Straight line production has been adopted in numerous continuous process industries such as sugar refineries, cement plants, automobiles etc. In recent years many other Industries have recognised the advantages to be gained by adopting line production methods. A block diagram of product layout arrangement is shown in Fig. 10.2.

Advantages of Product Layout (i) Channelised, flow of work reduces materials handling: Definite and direct channels for the flow of materials, short distances between operations elimination of backtracking and mechanisation of handling are features of product layout. This greatly reduces materials handling cost. (ii) Low cost labour and easy in procurement and training: Because of the use of special purpose automatic or semi-automatic machine's and elaborated tooling product layout can effectively utilise low - cost unskilled and semiskilled labor. (iii) Less inspection required: A limited amount of inspection at the end or at some critical point in the line is usually sufficient.

(iv) Floor area more productive: Minimum aisles. General absence of large banks of, temporary storage and numerous inspection. There is less need for movement of quantities to centre and temporary storage. (v) Short processing time: Intermediate activities between machine operations such as travel, storage and inspection occurs less frequently. Therefore opportunities for delays will be reduced. Hence the total time For processing product is shortened. (vi) Simplicity and easy production control As long as changes in design of product are held to a minimun and operations are standardised engineering and production planning activities is largely limited to initial program necessary to establish production. At the beginning it is necessary to prepare drawings, list of parts, materials requirement, routine procedures and so on. This simplifies production planning and control problem. Disadvantages of Product Layout (i) Higher initial investment: In product layout frequently at various work centers more than sufficient capacity will exist. This condition result in a unavoidable duplication of facilities and increases the investment required for product layout. (ii) Production line shut down will occur:

If a machine fails under product layout there is a shutdown of production. Shut down of line can also be caused by a mini shortage of material, employee absenteeism or poor production

(ill) Supervision more difficult: Line is a collection of numerous kinds of machine requiring a wide range of knowledge on the part of supervisor. Foreman's job involves supervision of diverse activities because each machine requires a knowledge of various setups, kinds of operations and operating feeds. He is also responsible for the quality control of many kinds of jobs being simultaneously processed. He must be also familiar with the maintenance requirements of his equipment. (iv) Inflexibility of facility: Equipment under product layout consist of facilities designed to perform special operations. Usually no machine unit of the line is exactly interchangeable In capacity, kind of work performed with any other unit. This characteristic of strict product layout results in inflexibility of facilities. This makes for interruption, costly change over or machine replacement design changes are made. 10.8 HYBRID LAYOUT More often a positioning strategy combines elements of both a product and process focus. This Is an intermediate positioning strategy which calls for a hybrid layout. Some portions of the facility are designed as a process layout and other portions are designed as a product layout. This treatment is often applied when group technology cells, one-worker-multiple-machine stations, or flexible manufacturing systems are introduced. These "islands of automation" represent miniature product layouts, since all resources needed to make the family of parts are together as one center. At the same time, not all production can be handled this way and the rest of the facility represents a process layout. Hybrid layouts also are found when

facilities have both fabrication and assembly operations. Fabrication operations, where components are made from raw materials, tend to have a process focus. Assembly operations tend to have a product focus. Another example of a hybrid layout is a retail store. Similar merchandise may be grouped so that customers have a fairly good idea of where to find desired items(a process layout). At the same time customers often are routed along fairly predetermined paths product layout. The motive is to maximize exposure to the full array of goods, thereby stimulating sales. 10.9 FIXED POSITION LAYOUT The fourth basic type of layout is the fixed-position layout. When a product is particularly massive or bulky it does not make sense to move it from one work station to another as with process, product or hybrid layouts. Such is the case in shipbuilding. Assembling airplanes or locomotives, making huge pressure vessels, building dams or repairing home furnaces. Workers, along with their tools and equipment, come to the product to work on it until it is finished, or at least until much of the work is completed. This layout type minimizes the number of times that the product must be moved and often is the only feasible solution.

Please use headphones 10.10 QUANTITATIVE ANALYSIS FOR PLANT LAYOUT Having addressed the more strategic issues of layout, it is time to consider actual designs. The approach differs, depending on whether a process layout or product layout has been chosen. We begin with an approach to process layouts, which also applies to the parts of hybrid layouts that have a process focus. Three basic steps are involved, whether you are designing a new layout or revising an existing layout: (i) Gather information (ii) Develop a block plan (ill) Design a detailed layout

Gather information (Step 1): Figure 10.3 illustrates the type of information needed to begin designing a. revised layout for a company's product. si.no.

DEPARTMENT

SQUARE METER

1.

BURR AND GRIND

100

2.

NC EQUIPMENT

95

3.

SHIPPING AND RECEIVING

75

4.

LATHES AND DRILLS

120

5.

TOOL CRIB

80

6.

INSPECTION

70 '

TOTAL

540

(a)2

4

3

6

5

1

<__________ 27m____________________>

Space Requirements by Center As shown in Fig. 10.3(a), the company has grouped its processes into six different departments, or center. For example, department 1 is the burr and grind area, and department 6 is the inspection area. The exact space requirements of each department, expressed in square feet, are shown in Fig. 10.3(a). You can calculate space requirements in various ways, but you must tie them to capacity plans. Itemize all

equipment and specific space needs for each center. Add enough "circulation" spaceto provide for aisles and the like. It is not unusual for circulation space to be at least 5 percent of the center's total space requirement. Available space: Fig.10.3fb) shows the available space and dimensions* of the facility, along with a rough allocation of space for each department. Whenever there is an existing layout, it is called the current block plan. Available space at the plant Is 27 m by 20 m, or 540 sq. meter. You could start by dividing the total amount of .space into six equal blocks of space (equivalent to 90 square meter), one for each department Tills amount of space is too much for inspection (needing only 70.59 square meter) and too little for lath«8 and drills(needing 120 square meter). However, the approximation is good enough until you reach the last step of process layout design. Closeness Ratings: Another type of information required is the need for locating different centers close to each other. This helps us determine the best relative location for each department Either a From-To matrix or a REL chart provides the needed information. Fig. 10.3(c) shows a From-To matrix for the company. The estimated number of materials handling trips from each department to every other one is shown. The greatest number of one-way trips is from department 1 to department 6 and from 6 to 3. Thus department 6 should be located near both 1 and 3, which certainly is not true in the current layout You can estimate the number of trips from the routing and ordering frequencies for typical items made at the plank Statistical sampling or polling of experts are other ways to obtain this information. A REL chart is a different way to express closeness ratings. The ratings are qualitative judgements of managers or employees. An A could signify the judgement that it is absolutely necessary to locate two departments close to each other, an E could represent the Judgement that it is especially important, and so on. Being qualitative, the A rating is higher that the E, but we do not know by how much.

Other consideration: The last information gathered for the company, other considerations. is shown in fig. 10.3(d). Some performance criteria depend on the absolute location of a department. These criteria cannot be reflected in a REL chart. Similarly, a From-To matrix tends to focus only on materials handling. Develop a block plan (Stop 2): The second step in layout design is to develop a block plans that satisfies performance criteria and area requirements insofar as possible. The most elementary way to do this is by trial and error but depends °" your ability to spot 'patterns in the data. There is no guarantee that you will identify the best or nearly best solution. However, one study showed that such as approach, at least when supplemented by the use of a computer to evaluate solutions, often compares quite favorably with more sophisticated techniques.

A good place to start is with the closeness ratings shown in Fig.10.3. To make it easier to identify significant interactions, you should merge the flows between department pairs in both directions. The results are shown in Fig. 10.4 and only the upper right half of the matrix is used. For example, the total number of trips between departments 1 and 6 is 80 Looking at the greatest interactions, a good block plan would

locate; (i) Departments 3 and 6 close together (ii) Departments 1 and 6 close together (iii) Departments 2 and 5 close together (iv) Departments 4 and 5 close together (v) Departments 3 and 4 at their current locations because of the other considerations listed in fig.10.3 It is not clear that all five requirements can be achieved. If after several attempts you cannot make them work, drop one or more and try again. If all five can be easily achieved. add more requirements. Fortunately, finding a good block plan for the company turns out to the fairly easy. The plan in fig. 10.5 was worked out by the trial and error method and satisfied all five requirements. Start by placing departments 3 and 4 and their current positions. Since the first requirements is to locate departments 3 and 6 close to each other, you can put 6 in the southeast corner of the layout this location minimizes the distance between 3 and 6. The second requirement is to have departments 1 and 6 close to each other. You can achieve it by putting 1 in the space just to the left of 6 and so on.

It helps to have a total desirability score for at least some aspects of a layout in order to see how much better one plan is than another. You can easily adapt the load - distance model for location problems to this purpose when relative locations are a key concern. In terms of material handling costs. 1 *d = n∑j=1 n∑i=1 1ij dij where Id = Total load - distance score measuring the materials

handling 1ij = Load, measured as the number of trips between departments 1 and j in both directions dij = Units of distance (actual Euclidean, or rectilinear) between department 1 and j, Where dij = 0 If i = j and n = Total number of department

* ALL OF THESE NONZERO RATINGS COME FROM FIG.10.4 # RECTILINEAR DISTANCES ARE CALCULATED FROM THE CURRENT PALN (FIG.10.3B0 AND THE PROPOSED PLAN (FIG.10.5) IN THE CURRENT PLAN. DEPARTMENTS 1 & 2 ARE AT THE SOUTHEST & NORTHWEST BLOCKS OF THE PLANT, RESPECTIVELY. THE DISTANCE BETWEEN THE CENTRES OF THESE BLOKS IS THERE UNITS OF DISTANCE (TWO HORIZON TALLY & ONE VERTICALLY)

Table 10.1 shows the results of applying this formula to the current and proposed block plans. The Id-score drops from 785 to 400. which represents an almost 50 percent improvement with the proposed plan. You must now decide whether this improvement is worth the cost of relocating four of the six departments. If relocation costs are too much, you must come up with a less expensive proposal. Looking at the calculation for the current plan in Table 10.1, you can get some clues. Much of 785 score comes from the trips between departments 3 and 6 and between departments 5 and 6. This solution puts department 6 closer to both 1 and 3. Additional calculations will show that the Id-score for this plan drops to 610, and only two departments have to be relocated. Perhaps this is the best compromise. Design a Detailed layout (step 3): After a satisfactory block plan is found, it should be translated into a. detailed representation showing the exact size and shape of each center, the arrangement of elements within it, and the location of aisles, stairways, and other unproductive space. These visual representations can be 2-dimensional drawings, 3-dimensional models, or even computer-aided graphics. This last step in the layout design process is important because it helps decision makers to grasp the essence of the proposal and even spot problems that might otherwise be overlooked. If others in the .company are to be Involved In layout decisions, the detailed layout becomes the focus of the discussion. 10.11 QUANTITATIVE ANALYSIS FOR PRODUCT LAYOUT ' We now' turn from process layouts to produce layouts, which raise entirely different issues for management. The two types of product layout are the production line and the assembly line. In both cases the work stations are arranged serially, and the product moves from one station to the next until the work is finished. Employees at one station work on a unit forwarded from the preceding station on the line. Although similar to an assembly line in most respects, a production line is different in one essential respect. Production-line* work is more capital intensive, and specialized equipment is used at each station; work cannot be partially shifted from one machine to an entirely different one, just to balance workloads. As assembly line, on the other hand, is more labor intensive, giving it much more flexibility for

repackaging work elements and better balancing loads; this flexibility is an advantage, but it also adds complexity. We therefore begin with production lines. Production lines: Designing a production line would be simple If desired output rates never varied, equipment capacity could be added In small Increments, processing times were constant, and there were no unexpected capacity losses. Unfortunately, such an environment is difficult to find. Several items belonging to the same product family might be produced on a line, but their processing times may not be identical at certain work stations. Customer demands fluctuate, creating either capacity or inventory problems. Yield losses do occur. These instabilities are particularly challenging in product layouts because of the serial dependency of work stations. Capacity and pacing decisions are crucial. Capacity: One question concerns the best capacity for each station. Should there be one, two or three machines at the station? The greater its capacity cushion, the less likely it will delay production at downstream stations. The answer depends largely on the Increments possible in adding capacity, the cost of adding increments, and management's strategy on workforce flexibility. There is some evidence of a bowl phenomenon in production lines, which means that extra capacity helps more at the center of a line to compensate. Such a line might actually perform better than a perfectly balanced one, where the amount of capacity cushion is equally distributed. Pacing: Another question is whether to use inventory to decouple work stations. Paced lines have no buffer inventory, making them particularly susceptible to unexpected capacity losses. With unpaced lines, inventory storage areas are placed between stations. These storage areas reduce the likelihood that unexpected downtime at one station will delay work downstream but do increase space and

Inventory costs. If unpaced lines seem to be a good strategy, they introduce the tactical question of how big the storage areas should be. A station can be held up for two reasons: (i) The first station has fallen behind to the point where the inbound inventory for the second station is depleted. The second station is delayed. (ii) The second station has fallen behind to the point where its inbound storage area is temporarily full. The first station Is delayed until there is room for the inventory. The second delay Is called blocking. It seems to happen more often at stations near the beginning of a line. Assembly lines: The additional complexity of assembly lines is narrated in the Illustration given below for a company. The management wants to set up an assembly line that will produce 2400 Big Broadcaster spreaders per week and operate one shift per day. The work elements and the times required to do them for each spreader are known. For example, bolting the leg frame to the hopper takes an average of 51 seconds. More than one work element can be performed at a station, but each work element is assigned to only one station. One worker at each station does the same work over and over. After the worker at one station finishes the assigned work for one unit, a conveyor moves the unit to the next station. The basic question is: "How many stations are needed and what work elements are to be assigned to each one?" Answering this question is called assembly-line balancing. Illustration: Assembly-line balancing at a company A company is expanding its product line to include a new concept in fertilizer spreaders called the Big Broadcaster. This spreader cuts fertilizer application time to 30 percent of that required with traditional methods. The Big Broadcaster is to be made on a new assembly line in one of the plants of the company. Most parts are to be purchased from outside suppliers. Management decided against

further vertical integration until customer response to the new spreader is better known. The plant manager, has just received marketing's latest forecasts for the next year. He wants the line to be designed to make 24OO spreaders per week for at least the next three months. The plant will operate 5 days per week, 1 shift per day, and 8 hours per shift. A few utility workers are used in the plant to relieve others for breaks, cover for absenteeism, and help at temporary bottlenecks. Since equipment failures will be negligible, the line should be operating practically 40 hours per week. The plant manager's staff has already identified the work that must be performed to assemble the spreader. The work is broken down into work elements which are the smallest units of work that can be performed independently. Each element is listed in the table with its corresponding performance time. The plant manager has decided on a paced line because of materials handling and space considerations. With no inventory storage, each" operator will have the same time to complete the assigned work elements. It also means that the whole line can move only as fast as the slowest station. In order to maximize productivity, the manager wants a line with the minimum number of stations that will assemble the required 2400 Big Broadcasters per week. The design problem is to determine the number of stations needed and the work elements to be performed at each station. Work element Description Times(sec.)________________________________________________________________

Attach legframe

1

Bolt leg frame to hopper

51

2

Insert impeller shaft into hopper

7

3

Attach agitator to shaft

24

4

Secure with cotter pin

10

Attach

axle

5

Insert bearings into housings

25

6

Slip axle through first bearing and shaft

40

7

Slip axle through second bearing

20

Attach drive

wheel

8

Slip on drive wheel

35

9

Place washer over axle

35

10

Secure with cotter pin

6

11

Push on hub cap

9

Attach free

wheel

•

12

Slip on free wheel

30

13

Place washer over axle

6

14

Secure with cotton pin

15

15

Push on hub cap

9

Mount lower

post

16

Bolt lower handle post to hopper

27

17

Seat post in square hole

13

18

Secure leg to support strap

60

Attach

controls

19

insert control wire

28

20

Guide wire through slot

12

21

Slip T handle over lower post

21

22

Attach on-off control

26

23

Attach level

58

24

Mount name plate

29

576

Total

Precedence diagram: If the work elements had to be performed in the each sequence listed in illustration, the preceding question could be easily answered. While most assembly lines must satisfy some technological precedence requirements among work elements, there usually is a fair amount of latitude and more than one possible sequence for doing them. 'Fig 1.6 shows a precedence diagram for assembling the Big Broadcaster. Each circle represents a work element, with the time to do it shown below the circle. The arrows show the precedence requirements. For example, either work element 2 or 5 can be done after 1. If the choice is 2, then either 3 or 5 can follow next. It also shows that 7 cannot start until after 4 and 6 are done. Work elements 4 and 6 must be assigned either to the same station as 7 or to a prior station. Desired output rate: The plant manager at the company has decided on an output rate of 2400 Big Broadcasters per week. While closely related to demand forecasts, the output rate also depends on policies on rebalancing frequency, capacity utilization, and job specialization. All else being equal, production rates should match demand rates as closely as possible. Matching ensures on- time delivery and prevents the build-

up of unwanted inventory. The disadvantage is that it increases rebalancing frequency. Each time a line is rebalanced, the jobs of many workers on the line must be redesigned. If the line is speeded up, a worker is given fewer work elements. If the line is slowed down, a worker is given more work elements. Time spent relearning jobs temporally hurts productivity. The changeover may even require a new detailed layout for some stations. Capacity utilization is another factor that has to be considered. Multiple shifts increase equipment utilization, which is crucial for capital-intensive facilities, but they may be unattractive because of higher pay rates or low demand. A third policy area related to the desired output rate is the degree of job specialization. As the desired output rate from a line increases, fewer work elements can be assigned to a station and jobs become more specialized. Cycle time: After the desired output rate for a line has been chosen, its cycle time can be computed. An assembly line's cycle time is the maximum amount of time allowed for work on a unit at each station. If the time required to do the work elements at a station exceeds the line's cycle time, the station will be a bottleneck, preventing the line from reaching its desired output rate. Returning to illustration, let's convert the desired output rate to an hourly rate. Dividing by 40 work hours per week we get 60 units per hour. The cycle time is the reciprocal of the desired hourly output rate. We need to convert it to seconds because

Idle time = nc - t Efficiency (%) = (t/nc)(100) Balance delay (%) = 100 - Efficiency Idle time is the total unproductive time for all stations in the assembly of each unit. Each of the n stations spends c seconds per unit, which means that nc is the total time spent per unit. Subtracting the productive time t gives us the idle time. Efficiency is the ratio of productive time to total time, expressed as a percent. Balance delay is the amount by which efficiency falls short of 100 % . So long as c is fixed, we can optimize all three goals by minimizing n.

Finding a solution: An overwhelming number of assembly-line solutions are possible, even for this small problem, and the number of possibilities expands as quickly as for process layouts. Once again, computer assistance is available. One software package, for example, considers every feasible combination of work elements that do not violate precedence or cycle time requirements when forming a new station. The combination that minimizes the station's idle time is selected. If any work elements remain unassigned, a second station is formed, and so on. The approach we will use is even simpler. At each iteration, a work element is selected from a list of candidates and assigned to a station. This process is repeated until all stations are formed. Two commonly Used decision rules for selecting from the candidate list are: Rule 1. Pick the candidate with the longest work-element time. Intuitively, this tends to assign the more difficult work elements to stations as quickly as possible. Work elements having shorter times are easier to fit into a station and should be saved for fine tuning the solution. Rule 2. Pick the candidate having the largest number of followers. Figure 10.6 shows, for example, that work element 18 has six followers and 21 has two followers. Intuitively, this rule helps to keep your options open for forming subsequent stations. Otherwise, precedence requirements may leave only a few possible sequences of work elements, and all of them may require an unnecessary amount of idle time. Returning to illustration, let's develop solutions manually using these rules. Our overall solution procedure is much like the logic that would be used in computer programs. Step 1. Let k=l, where k is a counter for the station being formed. Step 2. Make a Iist of candidates. Each work element included in the list must satisfy three conditions:

FIG. 10.6 PRECEDENCE DIAGRAM FOR ASSEMBLING THE BIGBROADCASTER (a) it has not yet been assigned to this or any previous station (b) all its predecessors have been assigned to this or ; previous station and (c) the sum of its time and those of the work elements (i any) already assigned to this station does not exceed the cycle time. If no such candidates can be found, go to step 4. Step 3. Pick a candidate using one of the two decision rules. Assigning it to station k. Go to step 2. Step 4. If some work elements are still unassigned, but there are n candidates, a new station must be started. Increment k by and go to step 2. Otherwise, you have a complete solution Stop. Figure 10.7 shows a solution that begins with picking candidate at step 3, using decision rule 1. Let's follow the first few iterations until the second station is formed to see the pattern. * (step 1) Start with station 1 (k=l). * (Step 2) Figure 1.6 shows us that only work element 1 can be candidate. It is a predecessor to all others.

* (step 3) Work element 1 is the first one assigned to station 1

* (step 2) Only 2 is a candidate. Work element 5 would exceed the station’s cycle time of 60 seconds. * (steps 3) Thus 2 is the second work element assigned to station 1 * (step 2) No candidates can be found. since adding either 3 or 5 would exceed the cycle time * (step 4) Move on to station 2 (k-2) * (step 2) The candidates are 3 and 5 * (step 3) Pick 5, since its time is longer. This is the first instance of a real choice because there was only one candidate for each previous iteration. * (step 2) Work element 3 is the only candidate. The time for 6 is too long to fit into station 2 * (step 3) Thus 3 is the second work element assigned to station 2 * (step 2) Only 4 is a candidate, again because of cycle time.

* (step 2) No candidates exist. Since adding 6 would exceed the cycle time. Station 2 is completed, consisting of work elements 5, 3, and 4 Continuing on in this manner, we find that the final solution shown in Fig. 10.7 calls for only 10 stations. The efficiency is 96% and balance delay only 4%. Our calculations of the theoretical minimum number of stations told us that we could do no better than this. It is impossible to product 2400 spreaders per week with less than 10 stations. Such a happy ending does not always occur, and, sometimes, another procedure would do better. Computer-based techniques tend to give good, although not necessarily optimal, result. Human judgment and pattern recognition often allow us to improve on computer generated solutions in fact, manual methods are still the most prevalent practices.

Many plant services must fit into the overall layout. The facts of these activities are not a part of the direct production activity of the enterprise has often tended to promote the idea that whatever space is left over is good enough for them. Actually, some of these activities, such as receiving. Shipping, and warehousing, is in the direct material flow and they process the product as do the production departments. Others, such as maintenance facilities and tool cribs, do not work on the product but interact with production costs so that their physical location and capacity deserve careful thought. The overall material flow patterns should be the major factors in determining the relative locations of receiving, shipping, storage, and warehousing areas. The capacity question for receiving areas does not have an obvious answer. In general, the problem is such that we do not have control over the rate at which materials come in. Since receipts of shipments from suppliers occur in a somewhat random pattern, a good design provides capacity that meets the reasonably expected peak loads for truck and rail docks, unloading crews, and temporary setdown areas for determining what these capacities should be. Of course, many other factors influence the details of the layout of receiving areas, such as climate, safety codes, handling equipment, dock heights, and the necessity to accommodate a variety of vehicles. The location of tool cribs is important because of the travel time of high-priced mechanics to and from the area. Therefore, a study of .the use frequency in relation to the physical layout of the production areas should determine a good location or locations. The tool storage problem is comparable to the material and part storage problem in using space efficiently while making items available quickly and conveniently. The number of attendants required to serve the tool crib is another waiting line problem. Maintenance facilities are commonly provided for building and grounds, plant utilities, and machinery and equipment. The capacity of maintenance for machinery and equipment again poses the problem of balancing the idle time of maintenance crews against the idle time of production workers, as well as losses of output capacity. Ordinarily, a considerable amount of idle capacity in equipment and crews is justifiable, as would be shown by solutions to waiting line models of these types of problems. Present-day personnel services cover a broad spectrum including

parking, cafeterias, medical services, credit unions, locker rooms, toilets and lavatories, and, quite often, recreational facilities. Obviously, providing for these services presents layout problems. In many instances, the location of these services does not have an effect on production costs since the services are used after hours. In these instances, the layout problem is to provide the space designed to perform the services in the amounts required. The activities must be studied to determine what must be done and facilities provided accordingly. For those services used during working hours, such as medical facilities, toilet facilities, and drinking fountains, the size of the facility and its location in relation to the users become important. Studies of travel distances to and from the service facility should be made in order to determine reasonable locations.Waiting line models are again useful in determining a balance between waiting times of employees and service capacity costs. In one large company which offered a broad medical service, the question of whether or not an additional doctor on the staff was warranted was answered by a waiting time study. The results of the study indicated that there was an average of 15 employees in the waiting room during the 8-hour work day; assuming a 2000 working hour year and a modest average hourly wage of Rs. 20, this translates into Rs.60,000 of waiting time per year. The study led to both an enlargement and decentralization of medical services. 10.13 PRINCIPLES OF MATERIALS HANDLING The three major principles of material handling are: 1. Reduction in time. 2. Reduction in handling. 3. Equipment design. Reduction in time: Time lost means paying men wages when they are not doing productive work. Lost time reduces the total production possible in a given length of time. Time is consumed principally in three things:

(i) Waiting, (11) Loading and unloading, (iii) Travel time. Waiting may be due to the bad scheduling or bad organization of the later force or it may be due to improper or insufficient facilities for loading. Loading and unloading time is the question of the efficiency of labor and the equipment for loading and unloading. In general, the larger the unit uploaded or unloaded, the greater the reduction that can be made in loading time. The greater the use of mechanical means that are faster than the manual labor, the more efficient can loading and unloading be made. Travel time depends upon the speed with which the equipment gets from one point to another. This is the factor of the individual speed of a truck and its rate of acceleration. A great deal of time can be lost by improper routing or through the selection of routes in which delays occur. Reduction In Handling: When there is less handling, less labor is involved and less time is Involved in production. Factors that are involved in reduction in handling are as follows: 1. Process changes, 2. Layout improvement. 3. Increased size of units handled, 4. Use of proper equipment. Layout improvement will make unnecessary the transfers of loads at various points to avoid obstructions. Changes In process Involving a layout change may make It possible to eliminate a transfer of load. If the material is loaded in the largest units that can be handled, the

amount of •handling is reduced. Equipment should be chosen which can be loaded most easily and with a minimum amount of hand labor necessary. Equipment Design: Factors In equipment design are efficiency, speed, weight, safety, maintenance and repair, first costs and operating costs obsolescence, flexibility and standardization. The efficiency of materials handling equipment is determined by the power input and labor required. Both of these are expressed in units of loads handled in order to measure efficiency. Speed in equipment design varies depending upon the nature of the product and the process. Weight is a factor in efficiency. The more dead weight the less the efficiency of the equipment. Weight must also be considered in connection with safe loading on the floors. The safety of the equipment is Important. Poor plant lighting, improper warning signs, blind comers or failure to keep aisles clear of pedestrians or workers may lead to a great many unnecessary accidents. The principles are summarised as follows. 1. All handling activities should be planned. 2. Plan a system integrating as many handling activities as possible and coordinating the full scope of operations. 3. Plan an operation sequence and equipment arrangement to optimize material flow. 4. Reduce, combine or eliminate unnecessary movements and/or equipment. 5. Utilize gravity to move material whenever practicable; 6. Make optimum utilization of building cube. 7. Increase quantity, weight, size of load handled.

8. Provide for safe handling methods and equipment. 9. Use mechanized or automated handling equipment when practicable. 10. In selecting handling equipment, consider all aspects of the material to be handled, the move to be made, and the methods to be utilized.

11. Standardize methods as well as types and sizes of handling equipment. 12. Use methods and equipment that can perform a variety of tasks and applications. 13. Minimize the ratio of mobile equipment dead weight to pay load. 14. Equipment designed to transport materials should be kept in motion. 15. Reduce idle or unproductive time of both handling and manpower. 16. Plan for preventive maintenance and scheduled repair of all handling equipment. 17. Replace obsolete handling methods and equipment when more efficient methods or equipment will improve operations. 18. Use material handling equipment to improve production control, inventory control, and order handling. 19. Use handling equipment to help achieve full production capacity. 20. Determine efficiency of handling performance in terms of expense per unit handled. 10.14 MATERIALS HANDLING EQUIPMENT The various types of equipment available for materials handling may be divided into three major divisions. 1. Lifting and lowering devices (Vertical motion)

2. Transporting devices (Horizontal motion) 3. Combination devices (Lifting and lowering plus transportation) 10.14.1 lifting end towering devices; In establishing this division only vertical motions not accompanied by any horizontal motion are considered. A block and tackle is one of the oldest and simplest methods of lifting something through a vertical distance. It depends on manpower and gives only the mechanical advantage. It is the oldest form of lifting, the most inexpensive in cost and the most wasteful of manpower. Winches are devices that effect vertical motion by the rope or cable on a drum. Here it-is possible to get much greater mechanical advantage than with a block and tackle by using manpower or other power. These are frequently used in loading heavy equipment into ships, construction equipment into building and in similar jobs.

Hoists are power driven devices often operated between fixed guide nails for lifting things vertically. They are similar to elevators except that, a hoist does not carry the operator on it. Elevators are differentiated from hoists by the fact that the operator rises with the load. Generally electric drive is used in elevators. 10.14.2 Transporting devices: The simplest transporting devices are wheel barrows and hand trucks. All this equipment involves a large amount of manpower for a relatively small load. The chief advantage of this equipment is its very low cost, its great flexibility and its easy portability from one Job to another. Industrial railways are narrow-gauge railroads. In general, little use is made of such equipment because it requires a heavy investment in the road bed and tracks, has little flexibility and is difficult to change at a later date.

Tractors and trailers are one of the most common methods of horizontal transportation. Great flexibility is secured as tractors can be used to haul such a variety of different types of trailers. Trailers can be left loaded and can be picked up by different tractors. This system has the advantage of great flexibility plus all the advantages of industrial railways and there is no investment in laying tracks. Pipe lines and pumps are also horizontal transportation for many commodities. Most obvious among these is oil, which is pumped great distances through pipe lines. Gas is also carried through pipe lines. Water is similarly transported. 10.14.3 Combination devices (lifting and lowering plus transportation): One of the simplest devices that have both vertical and horizontal motion is a chute which may either be straight or spiral. Gravity is utilized in order to move material down and to change the portion of the load horizontally. Chutes are common in railway and airline terminals for handling packages and baggage. Chutes are also used in departmental stores in a spiral form to bring the stock from reserver on the upper floors to the lower selling floors. Small crane trucks are also used for handling materials both in horizontal and vertical direction. Conveyor is an another equipment used for this purpose.This is continuous transportation system. Wheel gravity conveyor,' roller conveyor, screw conveyor and Roller spiral conveyor are the types of conveyors used normally.

10.14.4 Common materials handling equipment: The definitions, characteristics and uses of some types of handling equipment commonly used in mechanically oriented enterprise are explained below. 10.14.4.1 Conveyors: Flat belt conveyor-an endless fabric, rubber,plastic,leather,or metal belt operating over suitable drive, tail end, and bend terminals and

over belt idlers or slider bed for handling material, packages, or objects placed directly upon the belt.1. Top and return runs of belt may be utilized.2. Will operate on level. Incline up to 28 degrees, or downgrade.3. Belt supported on flat surface is used as carrier of objects or as basis for an assembly line.4. Belt supported by flat rollers will carry bags, bales, boxes, etc.5. Metal mesh belts are used for applications subjected to heat, cold, or chemicals.6. High capacity.7. Capacity easily adjusted.8. Versatile.9. Can elevate or lower.10. Provides continuous flow.11. Relatively easy maintenance.12. Used for:

Carrying objects (units, cartons, bags, bulk materials)

Assembly lines

Moving people Power and free conveyor-a combination of powered trolley conveyors and unpowered monorail-type free conveyors. Two sets of tracks are used, usually suspended one above the other. The upper track carries the powered trolley conveyor, and the lower is the free monorail track. Load-carrying free trolleys are engaged by pushers attached to the powered trolley conveyors. Load trolleys can be switched to and from adjacent unpowered free tracks. 1. Free trolleys move by gravity, or by pushers supported from trolley conveyor on upper level.2. Interconnections may be manually or automatically controlled.3. Track switches may divert trolleys from power to free tracks.4. Dispatching may be automatically controlled.

5. Free gravity tracks may be installed between two power tracks for storage.6. Speeds may be varied from one power section to another.7. Can include elevating and lowering units in free line.8. Can recirculate loads on all or sections of system.9. Can be computer controlled.10. Used for

Temporary storage of loads between points on machining, assembly, and test lines.

Routing loads to selected points.

Overhead storage for later delivery of loads to floor level.

Integrating production, assembly, and test equipment

Provides for surge storage against a breakdown.

10.14.4.2Cranes. Hoists, Monorails: Jib crane-a lifting device travelling on a horizontal beam that is mounted on a column or mast, which is fastened to : (a) floor, (b) floor and a top support, or (c) wall bracket or rails. . Bridge crane-a lifting device on a bridge consisting of one or two horizontal girders, which are supported at each end by trucks riding on runways installed at right angles to the bridge. Runways are installed on building columns, overhead trusses, or frames. Lifting device moves along bridge while bridge moves along runway. 1. Covers any spot within the rectangular area over which the bridge travels, i.e., length of one bay. 2. Can be provided with crossover to adjacent bay. 3. Produce 3 dimensional travel. 4. Designed as: • Top-running, where end trucks ride on top of runway tracks. • Bottom-running where end trucks are suspended from lower 5. Hoist can also be top or bottom running, 6. Bottom-running usually limited to about 10 tons.

7. Bridge propelled by hand, chained gearing or power. 8. Two hoists may be mounted on one crane. 9. Usually designed and built by specialist companies.

10. Does not interfere with work on floor. 11. Can reduce aisle space requirements. 12. Can reach areas otherwise not easily accessible. 13. Crane ways can extend out of building. 14. Can be pendent or radio controlled from the floor. 15. Used for:

Low to medium volume.

Large, heavy and awkward objects.

Machine shops, foundries, steel mills, heavy assembly and repair shops.

Intermittent moves.

Warehousing and yard storage.

With attachments such as magnets, slings, grabs, and buckets, can handle an extremely wide range of loads.

Monorail conveyor-a handling system on which loads are suspended from wheeled carriers or trolleys that usually roll along the top surface of the lower flange of the rail forming the overhead track, or in a similar fashion with other track shapes. 1. Relatively low installation cost.2. Low operating cost.3. Little maintenance.4. Track may be pipe, T, I, flat-bar or other formed structural shape.5. Can be hand or motor propelled on both travel and lift.

6. Motor may be controlled by pendant switches, from integral cab, or automatically.7. Removes traffic from floor.8. Release floor space.9. Makes use of overhead space.10. Easily extended.11. Switches, spurs, transfer bridges, drop sections, swinging sections, cross-overs, turntables provide flexibility. 10.14.4.3 Industrial trucks: Four wheel hand truck-a rectangular load-carrying platform with 4 to 6 wheels, for manual pushing, usually by means of a rack or handle at one or both ends. Some have 2 larger wheels at center of platform for easy maneuverability.

1. May be fitted with box or other special body for variety of handling tasks.2. Inexpensive3. Versatile4. Used for:

Manual handling of large loads

Supplementing mechanical handling

Low frequency moves

Low volume movement

Short distances

Relatively light loads

Temporary storage; in process storage

Handling awkward shapes

Weak floors

Small elevators

Narrow aisles

Crowded areas Hand lift truck- essentially a wheeled platform that can be rolled under a pallet or skid, and equipped with a lifting device designed to raise loads Just high enough to clear the floor and permit moving the load. Propulsion is by hand and lift Is by hydraulic or other mechanism. Platform type is used for handling skids, and fork type for handling pallets. 1. Low cost 2. Durable, minimum maintenance 3. Light weight 4. Compact 5. Simple to operate 6. Versatile 7. Used for:

Loading or unloading carriers

Supplementing powered trucks, spotting loads

Moderate distances

Intermittent, low-frequency use

Low volume moves

Increasing utilization of powered equipment

Captive use In a local area

Loading and unloading elevators

Tight quarters; narrow aisles

Fork lift truck-a self loading, counterbalanced, self-propelled, wheeled vehicle, carrying an operator, and designed to carry a load on a fork fastened to telescoping mast which is mounted ahead of the

vehicle to permit lifting and stacking of loads. 1. May be powered by petrol, diesel, battery, or LP gas engine. 2. Mast may be tilted forward or backward to facilitate loading and unloading 3. Operator may ride in center or at back end of truck-or, with special attachments, on the lifting mechanism, with the load 4. Operator may sit or stand 5. Used with a wide variety of attachments to provide an extremely flexible and adaptable handling device 6. Carries own power source- therefore useful away from power lines 7. Wheels and tires can be provided for a variety of floor conditions or operating locations-wood, concrete, highway,yard. 8. Wide range of capabilities 9. Electric type especially useful where reduced noise or no fumes are desired 10. Used for:

Lifting, lowering, stacking, unstacking, loading, unloading, maneuvering

Variable and flexible paths

Medium to large units loads

Uniform shaped loads

Low to medium volume of material

Intermittent moves

10.14.4.4 Auxiliary equipment: Dock board-a specially designed platform device to bridge the gap

between the edge of the dock and the carrier floor. Sometimes known as bridge plates. Carrier floors vary from 1200mm for rail cars, to 1300mm for pickup trucks, to 130mm for highway trucks, plus special bodies of even lower design. 1. Made in formed shape to provide strength and side guards. 2. Usually lightweight metal.

3. Often designed with loops to permit moving by fork truck. 4. Can be fastened to dock edge. 5. Some can be slid along a rail from one location to another. 6. Often have pins to lock lateral position 7. Have non-skid surfaces. 8. May be flared for narrow docks. 9. Should be carefully selected for intended use. Dock levelers-a platform-like device, built into the dock surface and hinged to permit raising and lowering to accommodate truck height when bridging the gap between dock and truck floor. 1. Permits extension of dock floor into carrier. 2. Adjusts up and down, left and right, or for vehicle tilt. 3. May be counterbalanced or hydraulically operated. 4. May be automatic; i.e., adjustment to truck Initiated upon bumping by vehicle. 5. Has lip, to level out vehicle end of platform. Pallet-a horizontal platform device used as a base for assembling

storing and handling materials as a unit load. Usually consists of two flat surfaces, separated by three stringers. 1. May be expendable, general purpose, or special purpose. 2. May be single or double faced. 3. May be flush stringer, single or double wing. 4. May be one-way, two-way or four-way entry. 5. Made of wood, plywood, metals, corrugated, plastic, etc. 6. Protects goods being moved from damage, pilferage, etc. 7. Facilitates inventorying. 8. Promotes cleanliness and good housekeeping. 9. Keeps material off floor, therefore easier to handle. 10. Used for:

Fork-truck-based systems.

Unitizing items.

Utilizing building cube.

Increasing load size.

Reducing handling of individual items.

Minimizing packaging of individual items.

Rack-a framework designed to facilitate the storage of loads, usually consisting of upright columns and horizontal members for supporting the loads, and diagonal bracing for stability.

1 May be classified as Selective: A

Bolted

Lock-fit

cantilever

Bar stock

A frame

Custom or Bulk: . A Drive-in

Drive-through

Live or Portable:

Integral unit

Rigid

Knock-down

Collapsible

Pallet stacking frame i2r Bolt-on

Snap fit-Independent of pallet

2. Made of metal, wood, pipe, etc. 3. May be fixed or adjustable in shelf height. 4. Usually built for pallets, but may be used or adapted for skids, rolls, drums, reels, bars, boxes, etc. 5. May have shelves for storage of loads, but may be designed for drive-in or drive-through applications. 6. Facilitates inventory taking. 7. Rugged; minimum maintenance 8. Live racks are designed for loads to flow to the unloading position. 9. Cantilever racks best for long items.

10. Used for:

Increasing utilization of storage space

Increasing selectivity of goods stored

Protecting goods

Control of inventory

Improving housekeeping. 10.15 SUMMARY Principles and factors of layout are discussed. Product layout and process layout are explained In detail. Advantages anddisadvantages of these layout types are discussed. A three step procedure for evaluating process layout and the linebalancing technique for product layout are explained. Principles of materials handling and the common materials handlingequipment like conveyors, cranes and trucks are discussed in this lesson. 10.16 KEY CONCEPTS Process layout Product layout Hybrid layout Fixed position layout Space requirement by a centre Closeness rating Block plan Production line Assembly line

Lifting and lowering devices Transportation devices Conveyors Cranes Hoists Monorails Trucks 10.17 MODEL QUESTIONS 1. What are the principles of a good layout? 2. What is product layout? Give its advantages and disadvantages. 3. What Is process layout? Give its advantages and disadvantages. 4. What are the principles of materials handling? 5. Briefly Identify four basic types of handling equipments. Indicate examples for each.

10.18 REFERENCE BOOKS 1. Apple, J.M., "Plant layout and materials handling", Prentice Hall. 2. Moore, F.G., "Plant layout design", John Whieley. 3. Krajewski and Ritzman, "Operations management", Addison-Wesley.

4. Buffa, "Modern production management", 4th edition. John Whieley.

END OF CHAPTER

LESSON-10

LAYOUT OF FACILITIES

10.1 Preamble 10.2 Principles of a good layout 10.3 Plant layout factors 10.4 Basic types of layout 10.5 Determining what to move 10.6 Process layout 10.7 Product layout 10.8 Hybrid layout 10.9 Fixed position layout 10.10 Quantitative analysis for process layout 10.11 Quantitative analysis for product layout 10.12 Service facilities 10.13 Principles of materials handling 10.14 Materials handling equipment* 10.14.1 Lifting and lowering devices

10.14.2 Transporting devices 10.14.3 Combination devices 10.14.4 Common material handling equipment 10.14.4.1 Conveyors 10.14.4.2 Cranes, Hoists, Monorails 10.14.4.3 Industrial trucks 10.14.4.4 Auxiliary equipment 10.15 Summary 10.16 Key concepts 10.17 Model questions 10.18 Reference books

10.1 PREAMBLE Plant layout is the integrating phase of the design of a production system. The basic objective of layout is to develop a production system that meets requirements of capacity and quality in the most economical way. The specification of what to make (drawings and specifications), how it is to be made (route sheets and operation sheets) and how many to make (forecasts, orders or contracts) become the basis for developing an integrated system of production. This integrated system must provide for machines, workplaces and storage in the capacities required so that feasible schedules can be determined for the various parts and products. The system should also provide a transportation system which moves the parts and products through the system. It should provide auxiliary services for production such as tool cribs and maintenance shops and for personnel such as medical facilities and cafeterias. Because of the dynamic character of our economy, the design of this integrated production machine must retain an appropriate degree of flexibility to provide for future changes in product designs, product volumes and mixes and for advancing production technology. Both the site and building should make it possible to expand

operations in a way that dovetails with existing operations. Certain financial and physical restrictions are a normal part of the layout problem. The physical restriction may be due to the site: its size, shape and orientation in relation to roads, railroads and utilities. Or they may be due to local laws which specify building restriction and safety codes. In redesign or relay out of facilities the existing building Impose severe restrictions. These general statements of the layout problem indicate something of its complexity. Almost all of the factors which enter the problem tend to interact. For example, providing flexibility affects the nature of processes and capacities which in turn interact with short and long run costs. Material transportation methods affects not only transportation costs but also the amount of handling at machines and workplaces. The physical arrangement and relative location of work centers are Important in determining transportation costs and direct labor costs. Storage locations and capacities interact with transportation costs and delay times. 10.2 PRINCIPLES OF A GOOD LAYOUT An optimum plant layout is one which provides maximum satisfaction to all parties concerned; that Is the employees and management as well as the stock holders. Each of the parties involved has certain interest in obtaining a good plant layout. Keeping this interest in mind the major principles of a good layout are: (I) provide over all simplifications (II) minimise cost of materials handling

(ill) provide high work-in-process turnover (iv) provide effective space utilisation (v) provide for worker convenience and promote Job satisfaction and safety (vi) avoid unnecessary capital investment

(vii) stimulate effective labor utilisation Simplify the productionprocess This is the broadest objective in obtaining a good layout. A good layout should be planned to facilitate the over-all manufacturing process so that it can be carried on in an optimum manner. More specifically, simplification may come from the following: a. Equipment should be arranged to provide greater utilisation. Equipment involving high capital inventory should be located so that it can be conveniently used on a multiple- shift basis. Material handling equipment, like conveyors should be located so that a group of products can utilise it conveniently. b. A good layout will minimize production delays and reduce congestion, production delays may be reduced or eliminated by good line balancing. Provision of proper amount of storage space reduces congestion on the floor. c. Good plant layout allows for the needs of maintenance of equipment. Equipment must be located so that routine maintenance is easy to perform. Good layout calls for prediction of future maintenance problems. d. Increasing output or shortening manufacturing time can be provided in an improved layout. Increased output means greater output with the same or less cost, saves the man hours and reduce machine hours. Manufacturing time can be reduced by eliminating idle time and removing unnecessary storages. Minimizing Materials Handling In a plant the production machines should be arranged such that the materials pass directly from one machine to another. Material

handling is brought to a minimum by this arrangement of machines. In many situations manual material handling is most economical. Even in this situation reducing the distances required for manual material handling should be considered when planning. Providing high work-in-process turnover Every day material remains in the plant and adds cost to the product because of the tied-up capital investment. In the process industries, for example, in a petroleum refineries where the product is in the liquid state, work-in-process turnover is high and unnecessarily in-process stages are reduced to a minimum. When the product is in the solid state, it is much more likely to involve a high capital investment in work-in-process. Although this is primarily a production control problem, good layout can be helpful in reducing work-in-process. Effective space utilisation Making good use of space involves considering not only production and storage areas, but also the floor area required by service departments. Stock bins spread out on only one level, idle aisles, and unorganised storage areas are all lead to poor space utilisation. The cost of floor space varies from one location to another location but considerable thought have to be given for accurately calculating floor area cost. Worker convenience and Job satisfaction Workers want to work in a convenient environment. Providing the worker with a place to leave his tools and with easy access to materials storage, reducing excessive noise with sound- deadening walls, as well as considering his safety are factors that should be examined when planning a layout. Attention to such items as heat, ventilation, light and removal of moisture and dirt is important in promoting worker's job satisfaction. Layout that calls for unstable stacking of materials should be changed to correct safety hazards. The layout engineer should keep close contact with the safety engineer in order to assure that safety has been thoroughly considered in a given layout.

Unnecessary capital Investment Capital investment in equipment can sometimes be reduced by the proper arrangement of machines and departments. By conveniently locating a particular piece of equipment. two different parts, both requiring part-time use of a broach, may be routed through the same broach. Thus the cost of a second machine is avoided. During the process planning phase capital investment can be minimized by making use of idle time on previously owned equipment. This type of problem is primarily one of the production scheduling, but by being aware of the problem the layout man can facilitate production scheduling by installing a good layout. Labour utilisation Every year so many productive man-hours are wasted because of poor layout. Proper layout does not guarantee but certainly stimulates the effective utilisation of man power. The following suggestions should be considered in making effective utilisation of labour. a. Direct labour utilisation: Improper layout can make the production job extremely wasteful. Making it necessary for the production worker to walk great distances to obtain tools or materials can waste a number of man hours. Good methods engineering and line balancing can minimise worker idle time. b. Indirect labor utilisation: Building design to provide ease of maintenance can save many rupees per year. Proper design of aisles can result in better utilisation of fork-lift operator. c. Better supervision:

A supervisor should theoretically be in contact with his department at all times. An enclosed office should be provided for a foreman with direct line authority. This is essential when a foreman finds it necessary to discipline a subordinate. 10.3 PLANT LAYOUT FACTORS Everyone with in an industrial organisation is concerned with plant layout in some way and everyone within a plant is interested in its layout to some degree. The worker is interested in the arrangement of his work station. The foreman is interested in layout as it affects the output of his department. Middle management is interested in layout as it affects the output and costs. Suggestions that result in plant layout thinking may come from anyone in the organisation from the director to the production worker. Most plant layout decisions are stimulated by one of the following factors.(i) product-design change(ii) new product(iii) change in volume of demand(iv) facilities becoming obsolete(v) frequent accidents(vi) poor working environment(vii) change In the location or concentration of markets(viii) cost reduction Product-designchanges Automobile models are radically changed frequently which usually require a change In plant layout. A full time plant layout department is essential in an automobile industry. In industries manufacturing a more stabilized product, plant layout may not be a crucial problem. These concerns must solve the plant layout problems whenever a product change comes even though it may occur infrequently. New product

The addition of a new product as well as the dropping of an old one is a development which results m thinking about the plant layout problem. Progressive companies are continually on the alert for new product developments. Research and development departments are continually providing new products for the industrial or home consumer. As these products come to the production-planning stage plant layout should be integrated with the planning of the production processes. Changes In the volume ofdemand An increased demand for a product may result in the revision of a present plant layout. It may result in the planning of a completely new plant. A decreased demand for a product may also result in plant layout changes. Facilities becoming obsolete Plant layout problems are often created by the obsolescence of industrial equipment, processes and buildings. Equipment replacement results in only minor changes in a present layout. On the other hand, when an industrial process becomes obsolete, changes in plant layout are usually-demanded. Buildings that become obsolete, whether because of size limitations or some other reason, may result in plant expansion of present building, the building of a new plant or a move into a new building. Any one of these alternatives involve considerable plant layout work. Frequent accidents Hazards to safety must be forseen while designing good plant layout Where-electric welding is a part of an industrial process, shields or screen must be provided around the arc-welding production centers in order to prevent injury to the eyes of personnel in surrounding areas. Aisles should be designed so as to minimise the possibility of accidents caused by materials handling equipment. Poor working environment

Worker complaints regarding working conditions such as noise or changes in temperature, may be resolved by changes in plant layout. Providing the worker with easy accessibility to materials, tools and instructions are considered in good plant layout A layout which considers these factors helps to establish the reputation of a firm as being a good place to work. Change In the location or concentration of markets Changes of market locations lead not only to plant layout problems but often make plant location studies necessary. Often the planning of a completely new plant is the answer to changes in market location. Cost reduction Cost reduction is a general term indicating management's device to reduce any one of the numerous costs involved in operating an Industrial concern. Since the time of the Industrial Revolution it has been one of the most vital of all the considerations in manufacturing industries. It must continue to have top priority if productivity curves are to continue upward. Costs can be reduced in many ways. New materials develop which can be substituted for expensive materials. The development of a faster production process can reduce the inventory tied-up in work-in process Inventory. Improved layout is synonymous with improved methods. In addition, improved plant layout can result in the reduction of cost brought by better utilisation of buildings, tools and equipment. With automatic factory on its way .the costs of maintenance will rise rapidly compared to the-costs of production. Proper layout can facilitate maintenance procedures and thereby achieve cost reductions. 10.4 BASIC TYPES OF LAYOUT Layout choices must closely be tied to higher level decisions. Several fundamental strategic choices must be made in layout planning.

10.5 DETERMINING WHAT TO MOVE Production consist of combining and manipulating men. materials and machines. These elements may be combined in various ways during production activity. The proportion In which these elements will be used depends on their relative cost and on the production process selected. Before laying out a plant it is necessary to determine which of these elements are to be fixed and which will be mobile during the process of production. Various alternatives are available in determining which factor to move. (i) to move the product and worker from one workstation to another workstation (ii) to move the product from one workstation to another workstation, keeping machine and worker stationary (iii) to move the worker and the machine to the product which is held at one locationThe decision as to which arrangement to employ depends on the relative mobility of each factor In plant and on the comparative cost of each method. The first method that is moving both product and worker from machine to machine is not very common in modem production. It is-employed in some job-lot production plants turning out custom- made products, worker moves with his work from machine to machine usually operating a limited variety of machines. The second method is common in the manufacture of standardised products. Product moves through machine work stations and continuous process equipment which are fixed to locations and attended by workers. Example is the flow of materials in any automobile manufacture.

In the third arrangement the worker and the machines are brought to the materials. Manufacturing operations producing bulky products as large steam turbines, boilers, generators, locomotives and ships. Fabricated and assembly of smaller parts are usually carried out under the first and second arrangement. There are many instances where the machining of large castings and other parts of the product is dene by portable machine tools which are brought to the product In most manufacturing concerns producing standard products and custom made products employs the first two alternatives.

10.6 TYPES OFLAYOUT This is designed for the non-repetitive, intermittent types of production where special orders are handled. In process grouping similar processes or equipment are grouped together. When strategy calls for process focus, resources (employees and equipment) must be organised around the process. A process layout accomplishes this purpose by clustering in one center the resources that perform similar functions. For example all grinding is done in a grinding department, all drills are located in the same area of a shop and all bills are processed in an accounts payable section. This format is most commonly used when many different products (customers) must be produced or served intermittently at the same work stations. Demand levels are too low or unpredictable to allow human and capital resources to be set aside exclusively for a particular product line or type of customer. Resources are relatively general purpose, flexible and less capital intensive.

The process layout is less vulnerable to changes in product mix or

new marketing strategies. Employee supervision can be more specialised which is important when the job content requires a good deal of technical knowledge. A block diagram of process layout arrangement is shown in fig. 10.1. Advantages of process layout (i) Lower capital investment: Less capital is needed because production machines will be utilised to greater capacity. Machine can be kept in operation most of the time. Equipment is highly productive. (ii) Wide flexibility in production facilities: Greater variety of jobs can be handled on a comparatively small investments because of utilisation of various types of general purpose equipment. Each machine can perform a wide range of similar kinds of operations. Moreover there is flexibility in planning production. Jobs are scheduled for a department as a whole. So it is possible to assign work to any available machine in the given department. (iii) Effective supervision readily achieved: Each foreman supervises only a limited range of machine operations like foreman over welding, grinding and so on. Because task for each foreman is not too diverse, he becomes highly proficient in time and with practice. He is able to direct the setup and performance of every kind of operation done on the equipment. He also becomes expert in maintenance and repair of equipment, inspection requirement and planning and production control of his department. (iv) Machine failures do not seriously disrupt production schedules:

Industrial machine break-downs do not hold up subsequent operations. If there is break-down in one machine in a department the work can be easily transferred to another machine in the same department. Disadvantages of process layout (i) More material handling: There will be no definite channels through which all the work will flow. Work, in-process, may return to the same department more than once for processing and this makes backtracking of work making higher cost of materials handling. (ii) Greater total floor area required:

A greater proportion of the floor space is required for service activities which result in a lower proportion of total plant area being devoted to actual production activities. There is greater need for aisles, temporary storage at each department. All of these need more floor space per unit of product turned out. (iii) Higher skilled labor and difficulty in labour procurement: Workers must be skilled because they operate a number of general purpose machines doing a variety of jobs. More highly skilled labour is required and wage rates will be usually higher. Further there may be difficulty in procuring such labor on short notice. (iv) Need for more frequent inspection:

Inspection is generally necessary before the work goes to the next operation in another department. Strict departmental responsibility for quality of work turned out is the main reason for the need of inspection in each department. Subsequent rejection of material by another department causes a considerable amount of handling, confusion and rerouting to rework the faulty part. (v) Longer processing times: Total time needed for processing production orders under process layout is greater than that required in product layout. More time is consumed because work necessary for loading the machines must be delivered to each department and after processing work is to be held for inspection. More over large amount of materials handling is necessary between departments. It is difficult to co-ordinate material handling because personnel cannot always be made available to move when it is released from a department. The end result is longer period of processing time. Process layout is suitable for intermittent production. It is employed when the same facilities are used to fabricate and assemble a wide variety of parts when part and product designs are not stable. From historical point of view process layout preceded product layout. Any considerable growth in demand for product of any industry gradually makes advisable the conversion of layout in part or whole from process to product. A gradual transition from process to product layout may take place as demand increases for products. Product layout is introduced first either.-in parts of fabricating activities or in assembly operations. The complete product layout arrangement is finally introduced to whole production process. 10.7 PRODUCT LAYOUT Equipment needed to fabricate or assemble the product is brought to-gether and setup in accordance with the required sequence of operations as shown on the process chart. Material flows through the predetermined channels of operations from the receipt of raw materials to fabrication of various component parts to final assembly. Product layout is designed for the flow type of production where continuous or repetitive operations are carried on to produce large quantities of a standardised product. Under product grouping all the machines needed to produce part or subassembly are arranged sequentially in a continuous line in the order in which the successive

operations on the product must be performed. The part flows from machine to machine moving a short distance at a time until all required operations are completed. This arrangement results in processing of the product in a forward flow from the receipt of raw materials to shipment of finished product. Straight line production has been adopted in numerous continuous process industries such as sugar refineries, cement plants, automobiles etc. In recent years many other Industries have recognised the advantages to be gained by adopting line production methods. A block diagram of product layout arrangement is shown in Fig. 10.2.

Advantages of Product Layout (i) Channelised, flow of work reduces materials handling: Definite and direct channels for the flow of materials, short distances between operations elimination of backtracking and mechanisation of handling are features of product layout. This greatly reduces materials handling cost. (ii) Low cost labour and easy in procurement and training:

Because of the use of special purpose automatic or semi-automatic machine's and elaborated tooling product layout can effectively utilise low - cost unskilled and semiskilled labor. (iii) Less inspection required: A limited amount of inspection at the end or at some critical point in the line is usually sufficient. (iv) Floor area more productive: Minimum aisles. General absence of large banks of, temporary storage and numerous inspection. There is less need for movement of quantities to centre and temporary storage. (v) Short processing time: Intermediate activities between machine operations such as travel, storage and inspection occurs less frequently. Therefore opportunities for delays will be reduced. Hence the total time For processing product is shortened. (vi) Simplicity and easy production control As long as changes in design of product are held to a minimun and operations are standardised engineering and production planning activities is largely limited to initial program necessary to establish production. At the beginning it is necessary to prepare drawings, list of parts, materials requirement, routine procedures and so on. This simplifies production planning and control problem. Disadvantages of Product Layout

(i) Higher initial investment: In product layout frequently at various work centers more than sufficient capacity will exist. This condition result in a unavoidable duplication of facilities and increases the investment required for product layout. (ii) Production line shut down will occur: If a machine fails under product layout there is a shutdown of production. Shut down of line can also be caused by a mini shortage of material, employee absenteeism or poor production

(ill) Supervision more difficult: Line is a collection of numerous kinds of machine requiring a wide range of knowledge on the part of supervisor. Foreman's job involves supervision of diverse activities because each machine requires a knowledge of various setups, kinds of operations and operating feeds. He is also responsible for the quality control of many kinds of jobs being simultaneously processed. He must be also familiar with the maintenance requirements of his equipment. (iv) Inflexibility of facility: Equipment under product layout consist of facilities designed to perform special operations. Usually no machine unit of the line is exactly interchangeable In capacity, kind of work performed with any other unit. This characteristic of strict product layout results in inflexibility of facilities. This makes for interruption, costly change over or machine replacement design changes are made. 10.8 HYBRID LAYOUT

More often a positioning strategy combines elements of both a product and process focus. This Is an intermediate positioning strategy which calls for a hybrid layout. Some portions of the facility are designed as a process layout and other portions are designed as a product layout. This treatment is often applied when group technology cells, one-worker-multiple-machine stations, or flexible manufacturing systems are introduced. These "islands of automation" represent miniature product layouts, since all resources needed to make the family of parts are together as one center. At the same time, not all production can be handled this way and the rest of the facility represents a process layout. Hybrid layouts also are found when facilities have both fabrication and assembly operations. Fabrication operations, where components are made from raw materials, tend to have a process focus. Assembly operations tend to have a product focus. Another example of a hybrid layout is a retail store. Similar merchandise may be grouped so that customers have a fairly good idea of where to find desired items(a process layout). At the same time customers often are routed along fairly predetermined paths product layout. The motive is to maximize exposure to the full array of goods, thereby stimulating sales. 10.9 FIXED POSITION LAYOUT The fourth basic type of layout is the fixed-position layout. When a product is particularly massive or bulky it does not make sense to move it from one work station to another as with process, product or hybrid layouts. Such is the case in shipbuilding. Assembling airplanes or locomotives, making huge pressure vessels, building dams or repairing home furnaces. Workers, along with their tools and equipment, come to the product to work on it until it is finished, or at least until much of the work is completed. This layout type minimizes the number of times that the product must be moved and often is the only feasible solution.

Please use headphones 10.10 QUANTITATIVE ANALYSIS FOR PLANT LAYOUT Having addressed the more strategic issues of layout, it is time to consider actual designs. The approach differs, depending on whether

a process layout or product layout has been chosen. We begin with an approach to process layouts, which also applies to the parts of hybrid layouts that have a process focus. Three basic steps are involved, whether you are designing a new layout or revising an existing layout: (i) Gather information (ii) Develop a block plan (ill) Design a detailed layout Gather information (Step 1): Figure 10.3 illustrates the type of information needed to begin designing a. revised layout for a company's product. si.no.

DEPARTMENT

SQUARE METER

1.

BURR AND GRIND

100

2.

NC EQUIPMENT

95

3.

SHIPPING AND RECEIVING

75

4.

LATHES AND DRILLS

120

5.

TOOL CRIB

80

6.

INSPECTION

70 '

TOTAL

540

(a)2

4

3

6

5

1

<__________ 27m____________________>

Space Requirements by Center As shown in Fig. 10.3(a), the company has grouped its processes into six different departments, or center. For example, department 1 is the

burr and grind area, and department 6 is the inspection area. The exact space requirements of each department, expressed in square feet, are shown in Fig. 10.3(a). You can calculate space requirements in various ways, but you must tie them to capacity plans. Itemize all equipment and specific space needs for each center. Add enough "circulation" spaceto provide for aisles and the like. It is not unusual for circulation space to be at least 5 percent of the center's total space requirement. Available space: Fig.10.3fb) shows the available space and dimensions* of the facility, along with a rough allocation of space for each department. Whenever there is an existing layout, it is called the current block plan. Available space at the plant Is 27 m by 20 m, or 540 sq. meter. You could start by dividing the total amount of .space into six equal blocks of space (equivalent to 90 square meter), one for each department Tills amount of space is too much for inspection (needing only 70.59 square meter) and too little for lath«8 and drills(needing 120 square meter). However, the approximation is good enough until you reach the last step of process layout design. Closeness Ratings: Another type of information required is the need for locating different centers close to each other. This helps us determine the best relative location for each department Either a From-To matrix or a REL chart provides the needed information. Fig. 10.3(c) shows a From-To matrix for the company. The estimated number of materials handling trips from each department to every other one is shown. The greatest number of one-way trips is from department 1 to department 6 and from 6 to 3. Thus department 6 should be located near both 1 and 3, which certainly is not true in the current layout You can estimate the number of trips from the routing and ordering frequencies for typical items made at the plank Statistical sampling or polling of experts are other ways to obtain this information. A REL chart is a different way to express closeness ratings. The ratings are qualitative judgements of managers or employees. An A could signify the judgement that it is absolutely necessary to locate

two departments close to each other, an E could represent the Judgement that it is especially important, and so on. Being qualitative, the A rating is higher that the E, but we do not know by how much. Other consideration: The last information gathered for the company, other considerations. is shown in fig. 10.3(d). Some performance criteria depend on the absolute location of a department. These criteria cannot be reflected in a REL chart. Similarly, a From-To matrix tends to focus only on materials handling. Develop a block plan (Stop 2): The second step in layout design is to develop a block plans that satisfies performance criteria and area requirements insofar as possible. The most elementary way to do this is by trial and error but depends °" your ability to spot 'patterns in the data. There is no guarantee that you will identify the best or nearly best solution. However, one study showed that such as approach, at least when supplemented by the use of a computer to evaluate solutions, often compares quite favorably with more sophisticated techniques.

A good place to start is with the closeness ratings shown in Fig.10.3.

To make it easier to identify significant interactions, you should merge the flows between department pairs in both directions. The results are shown in Fig. 10.4 and only the upper right half of the matrix is used. For example, the total number of trips between departments 1 and 6 is 80 Looking at the greatest interactions, a good block plan would locate; (i) Departments 3 and 6 close together (ii) Departments 1 and 6 close together (iii) Departments 2 and 5 close together (iv) Departments 4 and 5 close together (v) Departments 3 and 4 at their current locations because of the other considerations listed in fig.10.3 It is not clear that all five requirements can be achieved. If after several attempts you cannot make them work, drop one or more and try again. If all five can be easily achieved. add more requirements. Fortunately, finding a good block plan for the company turns out to the fairly easy. The plan in fig. 10.5 was worked out by the trial and error method and satisfied all five requirements. Start by placing departments 3 and 4 and their current positions. Since the first requirements is to locate departments 3 and 6 close to each other, you can put 6 in the southeast corner of the layout this location minimizes the distance between 3 and 6. The second requirement is to have departments 1 and 6 close to each other. You can achieve it by putting 1 in the space just to the left of 6 and so on.

It helps to have a total desirability score for at least some aspects of a layout in order to see how much better one plan is than another. You can easily adapt the load - distance model for location problems to this purpose when relative locations are a key concern. In terms of

material handling costs. 1 *d = n∑j=1 n∑i=1 1ij dij where Id = Total load - distance score measuring the materials handling 1ij = Load, measured as the number of trips between departments 1 and j in both directions dij = Units of distance (actual Euclidean, or rectilinear) between department 1 and j, Where dij = 0 If i = j and n = Total number of department

* ALL OF THESE NONZERO RATINGS COME FROM FIG.10.4 # RECTILINEAR DISTANCES ARE CALCULATED FROM THE CURRENT PALN (FIG.10.3B0 AND THE PROPOSED PLAN (FIG.10.5) IN THE CURRENT PLAN. DEPARTMENTS 1 & 2 ARE AT THE SOUTHEST & NORTHWEST BLOCKS OF THE PLANT,

RESPECTIVELY. THE DISTANCE BETWEEN THE CENTRES OF THESE BLOKS IS THERE UNITS OF DISTANCE (TWO HORIZON TALLY & ONE VERTICALLY) Table 10.1 shows the results of applying this formula to the current and proposed block plans. The Id-score drops from 785 to 400. which represents an almost 50 percent improvement with the proposed plan. You must now decide whether this improvement is worth the cost of relocating four of the six departments. If relocation costs are too much, you must come up with a less expensive proposal. Looking at the calculation for the current plan in Table 10.1, you can get some clues. Much of 785 score comes from the trips between departments 3 and 6 and between departments 5 and 6. This solution puts department 6 closer to both 1 and 3. Additional calculations will show that the Id-score for this plan drops to 610, and only two departments have to be relocated. Perhaps this is the best compromise. Design a Detailed layout (step 3): After a satisfactory block plan is found, it should be translated into a. detailed representation showing the exact size and shape of each center, the arrangement of elements within it, and the location of aisles, stairways, and other unproductive space. These visual representations can be 2-dimensional drawings, 3-dimensional models, or even computer-aided graphics. This last step in the layout design process is important because it helps decision makers to grasp the essence of the proposal and even spot problems that might otherwise be overlooked. If others in the .company are to be Involved In layout decisions, the detailed layout becomes the focus of the discussion. 10.11 QUANTITATIVE ANALYSIS FOR PRODUCT LAYOUT ' We now' turn from process layouts to produce layouts, which raise entirely different issues for management. The two types of product layout are the production line and the assembly line. In both cases the work stations are arranged serially, and the product moves from one station to the next until the work is finished. Employees at one station work on a unit forwarded from the preceding station on the line. Although similar to an assembly line in most respects, a production

line is different in one essential respect. Production-line* work is more capital intensive, and specialized equipment is used at each station; work cannot be partially shifted from one machine to an entirely different one, just to balance workloads. As assembly line, on the other hand, is more labor intensive, giving it much more flexibility for repackaging work elements and better balancing loads; this flexibility is an advantage, but it also adds complexity. We therefore begin with production lines. Production lines: Designing a production line would be simple If desired output rates never varied, equipment capacity could be added In small Increments, processing times were constant, and there were no unexpected capacity losses. Unfortunately, such an environment is difficult to find. Several items belonging to the same product family might be produced on a line, but their processing times may not be identical at certain work stations. Customer demands fluctuate, creating either capacity or inventory problems. Yield losses do occur. These instabilities are particularly challenging in product layouts because of the serial dependency of work stations. Capacity and pacing decisions are crucial. Capacity: One question concerns the best capacity for each station. Should there be one, two or three machines at the station? The greater its capacity cushion, the less likely it will delay production at downstream stations. The answer depends largely on the Increments possible in adding capacity, the cost of adding increments, and management's strategy on workforce flexibility. There is some evidence of a bowl phenomenon in production lines, which means that extra capacity helps more at the center of a line to compensate. Such a line might actually perform better than a perfectly balanced one, where the amount of capacity cushion is equally distributed. Pacing: Another question is whether to use inventory to decouple work

stations. Paced lines have no buffer inventory, making them particularly susceptible to unexpected capacity losses. With unpaced lines, inventory storage areas are placed between stations. These storage areas reduce the likelihood that unexpected downtime at one station will delay work downstream but do increase space and Inventory costs. If unpaced lines seem to be a good strategy, they introduce the tactical question of how big the storage areas should be. A station can be held up for two reasons: (i) The first station has fallen behind to the point where the inbound inventory for the second station is depleted. The second station is delayed. (ii) The second station has fallen behind to the point where its inbound storage area is temporarily full. The first station Is delayed until there is room for the inventory. The second delay Is called blocking. It seems to happen more often at stations near the beginning of a line. Assembly lines: The additional complexity of assembly lines is narrated in the Illustration given below for a company. The management wants to set up an assembly line that will produce 2400 Big Broadcaster spreaders per week and operate one shift per day. The work elements and the times required to do them for each spreader are known. For example, bolting the leg frame to the hopper takes an average of 51 seconds. More than one work element can be performed at a station, but each work element is assigned to only one station. One worker at each station does the same work over and over. After the worker at one station finishes the assigned work for one unit, a conveyor moves the unit to the next station. The basic question is: "How many stations are needed and what work elements are to be assigned to each one?" Answering this question is called assembly-line balancing. Illustration: Assembly-line balancing at a company A company is expanding its product line to include a new concept in

fertilizer spreaders called the Big Broadcaster. This spreader cuts fertilizer application time to 30 percent of that required with traditional methods. The Big Broadcaster is to be made on a new assembly line in one of the plants of the company. Most parts are to be purchased from outside suppliers. Management decided against further vertical integration until customer response to the new spreader is better known. The plant manager, has just received marketing's latest forecasts for the next year. He wants the line to be designed to make 24OO spreaders per week for at least the next three months. The plant will operate 5 days per week, 1 shift per day, and 8 hours per shift. A few utility workers are used in the plant to relieve others for breaks, cover for absenteeism, and help at temporary bottlenecks. Since equipment failures will be negligible, the line should be operating practically 40 hours per week. The plant manager's staff has already identified the work that must be performed to assemble the spreader. The work is broken down into work elements which are the smallest units of work that can be performed independently. Each element is listed in the table with its corresponding performance time. The plant manager has decided on a paced line because of materials handling and space considerations. With no inventory storage, each" operator will have the same time to complete the assigned work elements. It also means that the whole line can move only as fast as the slowest station. In order to maximize productivity, the manager wants a line with the minimum number of stations that will assemble the required 2400 Big Broadcasters per week. The design problem is to determine the number of stations needed and the work elements to be performed at each station. Work element Description Times(sec.)________________________________________________________________

Attach legframe

1

Bolt leg frame to hopper

51

2

Insert impeller shaft into hopper

7

3

Attach agitator to shaft

24

4

Secure with cotter pin

10

Attach axle

5

Insert bearings into housings

25

6

Slip axle through first bearing and shaft

40

7

Slip axle through second bearing

20

Attach drive

wheel

8

Slip on drive wheel

35

9

Place washer over axle

35

10

Secure with cotter pin

6

11

Push on hub cap

9

Attach free

wheel

•

12

Slip on free wheel

30

13

Place washer over axle

6

14

Secure with cotton pin

15

15

Push on hub cap

9

Mount lower

post

16

Bolt lower handle post to hopper

27

17

Seat post in square hole

13

18

Secure leg to support strap

60

Attach

controls

19

insert control wire

28

20

Guide wire through slot

12

21

Slip T handle over lower post

21

22

Attach on-off control

26

23

Attach level

58

24

Mount name plate

29

576

Total

Precedence diagram: If the work elements had to be performed in the each sequence listed in illustration, the preceding question could be easily answered. While most assembly lines must satisfy some technological precedence requirements among work elements, there usually is a fair amount of latitude and more than one possible sequence for doing them. 'Fig 1.6 shows a precedence diagram for assembling the Big Broadcaster. Each circle represents a work element, with the time to do it shown below the circle. The arrows show the precedence requirements. For example, either work element 2 or 5 can be done after 1. If the choice is 2, then either 3 or 5 can follow next. It also shows that 7 cannot start until after 4 and 6 are done. Work elements 4 and 6 must be assigned either to the same station as 7 or to a prior station. Desired output rate: The plant manager at the company has decided on an output rate of 2400 Big Broadcasters per week. While closely related to demand

forecasts, the output rate also depends on policies on rebalancing frequency, capacity utilization, and job specialization. All else being equal, production rates should match demand rates as closely as possible. Matching ensures on- time delivery and prevents the build-up of unwanted inventory. The disadvantage is that it increases rebalancing frequency. Each time a line is rebalanced, the jobs of many workers on the line must be redesigned. If the line is speeded up, a worker is given fewer work elements. If the line is slowed down, a worker is given more work elements. Time spent relearning jobs temporally hurts productivity. The changeover may even require a new detailed layout for some stations. Capacity utilization is another factor that has to be considered. Multiple shifts increase equipment utilization, which is crucial for capital-intensive facilities, but they may be unattractive because of higher pay rates or low demand. A third policy area related to the desired output rate is the degree of job specialization. As the desired output rate from a line increases, fewer work elements can be assigned to a station and jobs become more specialized. Cycle time: After the desired output rate for a line has been chosen, its cycle time can be computed. An assembly line's cycle time is the maximum amount of time allowed for work on a unit at each station. If the time required to do the work elements at a station exceeds the line's cycle time, the station will be a bottleneck, preventing the line from reaching its desired output rate. Returning to illustration, let's convert the desired output rate to an hourly rate. Dividing by 40 work hours per week we get 60 units per hour. The cycle time is the reciprocal of the desired hourly output rate. We need to convert it to seconds because

Idle time = nc - t Efficiency (%) = (t/nc)(100) Balance delay (%) = 100 - Efficiency Idle time is the total unproductive time for all stations in the assembly of each unit. Each of the n stations spends c seconds per unit, which means that nc is the total time spent per unit. Subtracting the productive time t gives us the idle time. Efficiency is the ratio of productive time to total time, expressed as a percent. Balance delay is

the amount by which efficiency falls short of 100 % . So long as c is fixed, we can optimize all three goals by minimizing n. Finding a solution: An overwhelming number of assembly-line solutions are possible, even for this small problem, and the number of possibilities expands as quickly as for process layouts. Once again, computer assistance is available. One software package, for example, considers every feasible combination of work elements that do not violate precedence or cycle time requirements when forming a new station. The combination that minimizes the station's idle time is selected. If any work elements remain unassigned, a second station is formed, and so on. The approach we will use is even simpler. At each iteration, a work element is selected from a list of candidates and assigned to a station. This process is repeated until all stations are formed. Two commonly Used decision rules for selecting from the candidate list are: Rule 1. Pick the candidate with the longest work-element time. Intuitively, this tends to assign the more difficult work elements to stations as quickly as possible. Work elements having shorter times are easier to fit into a station and should be saved for fine tuning the solution. Rule 2. Pick the candidate having the largest number of followers. Figure 10.6 shows, for example, that work element 18 has six followers and 21 has two followers. Intuitively, this rule helps to keep your options open for forming subsequent stations. Otherwise, precedence requirements may leave only a few possible sequences of work elements, and all of them may require an unnecessary amount of idle time. Returning to illustration, let's develop solutions manually using these rules. Our overall solution procedure is much like the logic that would be used in computer programs.

Step 1. Let k=l, where k is a counter for the station being formed. Step 2. Make a Iist of candidates. Each work element included in the list must satisfy three conditions:

FIG. 10.6 PRECEDENCE DIAGRAM FOR ASSEMBLING THE BIGBROADCASTER (a) it has not yet been assigned to this or any previous station (b) all its predecessors have been assigned to this or ; previous station and (c) the sum of its time and those of the work elements (i any) already assigned to this station does not exceed the cycle time. If no such candidates can be found, go to step 4. Step 3. Pick a candidate using one of the two decision rules. Assigning it to station k. Go to step 2. Step 4. If some work elements are still unassigned, but there are n candidates, a new station must be started. Increment k by and go to step 2. Otherwise, you have a complete solution Stop. Figure 10.7 shows a solution that begins with picking candidate at step 3, using decision rule 1. Let's follow the first few iterations until the second station is formed to see the pattern.

* (step 1) Start with station 1 (k=l). * (Step 2) Figure 1.6 shows us that only work element 1 can be candidate. It is a predecessor to all others. * (step 3) Work element 1 is the first one assigned to station 1

* (step 2) Only 2 is a candidate. Work element 5 would exceed the station’s cycle time of 60 seconds. * (steps 3) Thus 2 is the second work element assigned to station 1 * (step 2) No candidates can be found. since adding either 3 or 5 would exceed the cycle time * (step 4) Move on to station 2 (k-2) * (step 2) The candidates are 3 and 5 * (step 3) Pick 5, since its time is longer. This is the first instance of a real choice because there was only one candidate for each previous iteration. * (step 2) Work element 3 is the only candidate. The time for 6 is too

long to fit into station 2 * (step 3) Thus 3 is the second work element assigned to station 2 * (step 2) Only 4 is a candidate, again because of cycle time. * (step 2) No candidates exist. Since adding 6 would exceed the cycle time. Station 2 is completed, consisting of work elements 5, 3, and 4 Continuing on in this manner, we find that the final solution shown in Fig. 10.7 calls for only 10 stations. The efficiency is 96% and balance delay only 4%. Our calculations of the theoretical minimum number of stations told us that we could do no better than this. It is impossible to product 2400 spreaders per week with less than 10 stations. Such a happy ending does not always occur, and, sometimes, another procedure would do better. Computer-based techniques tend to give good, although not necessarily optimal, result. Human judgment and pattern recognition often allow us to improve on computer generated solutions in fact, manual methods are still the most prevalent practices.

Many plant services must fit into the overall layout. The facts of these activities are not a part of the direct production activity of the enterprise has often tended to promote the idea that whatever space is left over is good enough for them. Actually, some of these activities, such as receiving. Shipping, and warehousing, is in the direct material flow and they process the product as do the production departments. Others, such as maintenance facilities and tool cribs, do not work on the product but interact with production costs so that their physical location and capacity deserve careful thought. The overall material flow patterns should be the major factors in determining the relative locations of receiving, shipping, storage, and warehousing areas. The capacity question for receiving areas does not have an obvious answer. In general, the problem is such that we do not have control over the rate at which materials come in. Since receipts of shipments from suppliers occur in a somewhat random pattern, a good design

provides capacity that meets the reasonably expected peak loads for truck and rail docks, unloading crews, and temporary setdown areas for determining what these capacities should be. Of course, many other factors influence the details of the layout of receiving areas, such as climate, safety codes, handling equipment, dock heights, and the necessity to accommodate a variety of vehicles. The location of tool cribs is important because of the travel time of high-priced mechanics to and from the area. Therefore, a study of .the use frequency in relation to the physical layout of the production areas should determine a good location or locations. The tool storage problem is comparable to the material and part storage problem in using space efficiently while making items available quickly and conveniently. The number of attendants required to serve the tool crib is another waiting line problem. Maintenance facilities are commonly provided for building and grounds, plant utilities, and machinery and equipment. The capacity of maintenance for machinery and equipment again poses the problem of balancing the idle time of maintenance crews against the idle time of production workers, as well as losses of output capacity. Ordinarily, a considerable amount of idle capacity in equipment and crews is justifiable, as would be shown by solutions to waiting line models of these types of problems. Present-day personnel services cover a broad spectrum including parking, cafeterias, medical services, credit unions, locker rooms, toilets and lavatories, and, quite often, recreational facilities. Obviously, providing for these services presents layout problems. In many instances, the location of these services does not have an effect on production costs since the services are used after hours. In these instances, the layout problem is to provide the space designed to perform the services in the amounts required. The activities must be studied to determine what must be done and facilities provided accordingly. For those services used during working hours, such as medical facilities, toilet facilities, and drinking fountains, the size of the facility and its location in relation to the users become important. Studies of travel distances to and from the service facility should be made in order to determine reasonable locations.Waiting line models are again useful in determining a balance between waiting times of employees and service capacity costs. In one large company which offered a

broad medical service, the question of whether or not an additional doctor on the staff was warranted was answered by a waiting time study. The results of the study indicated that there was an average of 15 employees in the waiting room during the 8-hour work day; assuming a 2000 working hour year and a modest average hourly wage of Rs. 20, this translates into Rs.60,000 of waiting time per year. The study led to both an enlargement and decentralization of medical services. 10.13 PRINCIPLES OF MATERIALS HANDLING The three major principles of material handling are: 1. Reduction in time. 2. Reduction in handling. 3. Equipment design. Reduction in time: Time lost means paying men wages when they are not doing productive work. Lost time reduces the total production possible in a given length of time. Time is consumed principally in three things: (i) Waiting, (11) Loading and unloading, (iii) Travel time. Waiting may be due to the bad scheduling or bad organization of the later force or it may be due to improper or insufficient facilities for loading. Loading and unloading time is the question of the efficiency of labor and the equipment for loading and unloading. In general, the larger the unit uploaded or unloaded, the greater the reduction that can be made in loading time. The greater the use of mechanical means that are faster than the manual labor, the more efficient can loading and

unloading be made. Travel time depends upon the speed with which the equipment gets from one point to another. This is the factor of the individual speed of a truck and its rate of acceleration. A great deal of time can be lost by improper routing or through the selection of routes in which delays occur. Reduction In Handling: When there is less handling, less labor is involved and less time is Involved in production. Factors that are involved in reduction in handling are as follows: 1. Process changes, 2. Layout improvement. 3. Increased size of units handled, 4. Use of proper equipment. Layout improvement will make unnecessary the transfers of loads at various points to avoid obstructions. Changes In process Involving a layout change may make It possible to eliminate a transfer of load. If the material is loaded in the largest units that can be handled, the amount of •handling is reduced. Equipment should be chosen which can be loaded most easily and with a minimum amount of hand labor necessary. Equipment Design: Factors In equipment design are efficiency, speed, weight, safety, maintenance and repair, first costs and operating costs obsolescence, flexibility and standardization. The efficiency of materials handling equipment is determined by the power input and labor required. Both of these are expressed in units of loads handled in order to measure efficiency. Speed in equipment design varies depending upon the nature of the

product and the process. Weight is a factor in efficiency. The more dead weight the less the efficiency of the equipment. Weight must also be considered in connection with safe loading on the floors. The safety of the equipment is Important. Poor plant lighting, improper warning signs, blind comers or failure to keep aisles clear of pedestrians or workers may lead to a great many unnecessary accidents. The principles are summarised as follows. 1. All handling activities should be planned. 2. Plan a system integrating as many handling activities as possible and coordinating the full scope of operations. 3. Plan an operation sequence and equipment arrangement to optimize material flow. 4. Reduce, combine or eliminate unnecessary movements and/or equipment. 5. Utilize gravity to move material whenever practicable; 6. Make optimum utilization of building cube. 7. Increase quantity, weight, size of load handled. 8. Provide for safe handling methods and equipment. 9. Use mechanized or automated handling equipment when practicable. 10. In selecting handling equipment, consider all aspects of the material to be handled, the move to be made, and the methods to be utilized.

11. Standardize methods as well as types and sizes of handling equipment. 12. Use methods and equipment that can perform a variety of tasks and applications. 13. Minimize the ratio of mobile equipment dead weight to pay load. 14. Equipment designed to transport materials should be kept in

motion. 15. Reduce idle or unproductive time of both handling and manpower. 16. Plan for preventive maintenance and scheduled repair of all handling equipment. 17. Replace obsolete handling methods and equipment when more efficient methods or equipment will improve operations. 18. Use material handling equipment to improve production control, inventory control, and order handling. 19. Use handling equipment to help achieve full production capacity. 20. Determine efficiency of handling performance in terms of expense per unit handled. 10.14 MATERIALS HANDLING EQUIPMENT The various types of equipment available for materials handling may be divided into three major divisions. 1. Lifting and lowering devices (Vertical motion) 2. Transporting devices (Horizontal motion) 3. Combination devices (Lifting and lowering plus transportation) 10.14.1 lifting end towering devices; In establishing this division only vertical motions not accompanied by any horizontal motion are considered. A block and tackle is one of the oldest and simplest methods of lifting something through a vertical distance. It depends on manpower and gives only the mechanical advantage. It is the oldest form of lifting, the most inexpensive in cost and the most wasteful of manpower. Winches are devices that effect vertical motion by the rope or cable on

a drum. Here it-is possible to get much greater mechanical advantage than with a block and tackle by using manpower or other power. These are frequently used in loading heavy equipment into ships, construction equipment into building and in similar jobs.

Hoists are power driven devices often operated between fixed guide nails for lifting things vertically. They are similar to elevators except that, a hoist does not carry the operator on it. Elevators are differentiated from hoists by the fact that the operator rises with the load. Generally electric drive is used in elevators. 10.14.2 Transporting devices: The simplest transporting devices are wheel barrows and hand trucks. All this equipment involves a large amount of manpower for a relatively small load. The chief advantage of this equipment is its very low cost, its great flexibility and its easy portability from one Job to another. Industrial railways are narrow-gauge railroads. In general, little use is made of such equipment because it requires a heavy investment in the road bed and tracks, has little flexibility and is difficult to change at a later date. Tractors and trailers are one of the most common methods of horizontal transportation. Great flexibility is secured as tractors can be used to haul such a variety of different types of trailers. Trailers can be left loaded and can be picked up by different tractors. This system has the advantage of great flexibility plus all the advantages of industrial railways and there is no investment in laying tracks. Pipe lines and pumps are also horizontal transportation for many commodities. Most obvious among these is oil, which is pumped great distances through pipe lines. Gas is also carried through pipe lines. Water is similarly transported. 10.14.3 Combination devices (lifting and lowering plus transportation): One of the simplest devices that have both vertical and horizontal

motion is a chute which may either be straight or spiral. Gravity is utilized in order to move material down and to change the portion of the load horizontally. Chutes are common in railway and airline terminals for handling packages and baggage. Chutes are also used in departmental stores in a spiral form to bring the stock from reserver on the upper floors to the lower selling floors. Small crane trucks are also used for handling materials both in horizontal and vertical direction. Conveyor is an another equipment used for this purpose.This is continuous transportation system. Wheel gravity conveyor,' roller conveyor, screw conveyor and Roller spiral conveyor are the types of conveyors used normally.

10.14.4 Common materials handling equipment: The definitions, characteristics and uses of some types of handling equipment commonly used in mechanically oriented enterprise are explained below. 10.14.4.1 Conveyors: Flat belt conveyor-an endless fabric, rubber,plastic,leather,or metal belt operating over suitable drive, tail end, and bend terminals and over belt idlers or slider bed for handling material, packages, or objects placed directly upon the belt.1. Top and return runs of belt may be utilized.2. Will operate on level. Incline up to 28 degrees, or downgrade.3. Belt supported on flat surface is used as carrier of objects or as basis for an assembly line.4. Belt supported by flat rollers will carry bags, bales, boxes, etc.5. Metal mesh belts are used for applications subjected to heat, cold, or chemicals.6. High capacity.7. Capacity easily adjusted.8. Versatile.9. Can elevate or lower.10. Provides continuous flow.11. Relatively easy maintenance.12. Used for:

Carrying objects (units, cartons, bags, bulk materials)

Assembly lines

Moving people Power and free conveyor-a combination of powered trolley conveyors and unpowered monorail-type free conveyors. Two sets of tracks are used, usually suspended one above the other. The upper track carries the powered trolley conveyor, and the lower is the free monorail track. Load-carrying free trolleys are engaged by pushers attached to the powered trolley conveyors. Load trolleys can be switched to and from adjacent unpowered free tracks. 1. Free trolleys move by gravity, or by pushers supported from trolley conveyor on upper level.2. Interconnections may be manually or automatically controlled.3. Track switches may divert trolleys from power to free tracks.4. Dispatching may be automatically controlled.

5. Free gravity tracks may be installed between two power tracks for storage.6. Speeds may be varied from one power section to another.7. Can include elevating and lowering units in free line.8. Can recirculate loads on all or sections of system.9. Can be computer controlled.10. Used for

Temporary storage of loads between points on machining, assembly, and test lines.

Routing loads to selected points.

Overhead storage for later delivery of loads to floor level.

Integrating production, assembly, and test equipment

Provides for surge storage against a breakdown.

10.14.4.2Cranes. Hoists, Monorails: Jib crane-a lifting device travelling on a horizontal beam that is mounted on a column or mast, which is fastened to : (a) floor,

(b) floor and a top support, or (c) wall bracket or rails. . Bridge crane-a lifting device on a bridge consisting of one or two horizontal girders, which are supported at each end by trucks riding on runways installed at right angles to the bridge. Runways are installed on building columns, overhead trusses, or frames. Lifting device moves along bridge while bridge moves along runway. 1. Covers any spot within the rectangular area over which the bridge travels, i.e., length of one bay. 2. Can be provided with crossover to adjacent bay. 3. Produce 3 dimensional travel. 4. Designed as: • Top-running, where end trucks ride on top of runway tracks. • Bottom-running where end trucks are suspended from lower 5. Hoist can also be top or bottom running, 6. Bottom-running usually limited to about 10 tons. 7. Bridge propelled by hand, chained gearing or power. 8. Two hoists may be mounted on one crane. 9. Usually designed and built by specialist companies.

10. Does not interfere with work on floor. 11. Can reduce aisle space requirements. 12. Can reach areas otherwise not easily accessible. 13. Crane ways can extend out of building. 14. Can be pendent or radio controlled from the floor. 15. Used for:

Low to medium volume.

Large, heavy and awkward objects.

Machine shops, foundries, steel mills, heavy assembly and repair shops.

Intermittent moves.

Warehousing and yard storage.

With attachments such as magnets, slings, grabs, and buckets, can handle an extremely wide range of loads.

Monorail conveyor-a handling system on which loads are suspended from wheeled carriers or trolleys that usually roll along the top surface of the lower flange of the rail forming the overhead track, or in a similar fashion with other track shapes. 1. Relatively low installation cost.2. Low operating cost.3. Little maintenance.4. Track may be pipe, T, I, flat-bar or other formed structural shape.5. Can be hand or motor propelled on both travel and lift.6. Motor may be controlled by pendant switches, from integral cab, or automatically.7. Removes traffic from floor.8. Release floor space.9. Makes use of overhead space.10. Easily extended.11. Switches, spurs, transfer bridges, drop sections, swinging sections, cross-overs, turntables provide flexibility. 10.14.4.3 Industrial trucks: Four wheel hand truck-a rectangular load-carrying platform with 4 to 6 wheels, for manual pushing, usually by means of a rack or handle at one or both ends. Some have 2 larger wheels at center of platform

for easy maneuverability.

1. May be fitted with box or other special body for variety of handling tasks.2. Inexpensive3. Versatile4. Used for:

Manual handling of large loads

Supplementing mechanical handling

Low frequency moves

Low volume movement

Short distances

Relatively light loads

Temporary storage; in process storage

Handling awkward shapes

Weak floors

Small elevators

Narrow aisles

Crowded areas Hand lift truck- essentially a wheeled platform that can be rolled under a pallet or skid, and equipped with a lifting device designed to raise loads Just high enough to clear the floor and permit moving the load. Propulsion is by hand and lift Is by hydraulic or other mechanism. Platform type is used for handling skids, and fork type for handling pallets. 1. Low cost 2. Durable, minimum maintenance 3. Light weight 4. Compact

5. Simple to operate 6. Versatile 7. Used for:

Loading or unloading carriers

Supplementing powered trucks, spotting loads

Moderate distances

Intermittent, low-frequency use

Low volume moves

Increasing utilization of powered equipment

Captive use In a local area

Loading and unloading elevators

Tight quarters; narrow aisles

Fork lift truck-a self loading, counterbalanced, self-propelled, wheeled vehicle, carrying an operator, and designed to carry a load on a fork fastened to telescoping mast which is mounted ahead of the vehicle to permit lifting and stacking of loads. 1. May be powered by petrol, diesel, battery, or LP gas engine. 2. Mast may be tilted forward or backward to facilitate loading and unloading 3. Operator may ride in center or at back end of truck-or, with special attachments, on the lifting mechanism, with the load 4. Operator may sit or stand 5. Used with a wide variety of attachments to provide an extremely flexible and adaptable handling device 6. Carries own power source- therefore useful away from power lines

7. Wheels and tires can be provided for a variety of floor conditions or operating locations-wood, concrete, highway,yard. 8. Wide range of capabilities 9. Electric type especially useful where reduced noise or no fumes are desired 10. Used for:

Lifting, lowering, stacking, unstacking, loading, unloading, maneuvering

Variable and flexible paths

Medium to large units loads

Uniform shaped loads

Low to medium volume of material

Intermittent moves

10.14.4.4 Auxiliary equipment: Dock board-a specially designed platform device to bridge the gap between the edge of the dock and the carrier floor. Sometimes known as bridge plates. Carrier floors vary from 1200mm for rail cars, to 1300mm for pickup trucks, to 130mm for highway trucks, plus special bodies of even lower design. 1. Made in formed shape to provide strength and side guards. 2. Usually lightweight metal.

3. Often designed with loops to permit moving by fork truck. 4. Can be fastened to dock edge. 5. Some can be slid along a rail from one location to another. 6. Often have pins to lock lateral position

7. Have non-skid surfaces. 8. May be flared for narrow docks. 9. Should be carefully selected for intended use. Dock levelers-a platform-like device, built into the dock surface and hinged to permit raising and lowering to accommodate truck height when bridging the gap between dock and truck floor. 1. Permits extension of dock floor into carrier. 2. Adjusts up and down, left and right, or for vehicle tilt. 3. May be counterbalanced or hydraulically operated. 4. May be automatic; i.e., adjustment to truck Initiated upon bumping by vehicle. 5. Has lip, to level out vehicle end of platform. Pallet-a horizontal platform device used as a base for assembling storing and handling materials as a unit load. Usually consists of two flat surfaces, separated by three stringers. 1. May be expendable, general purpose, or special purpose. 2. May be single or double faced. 3. May be flush stringer, single or double wing. 4. May be one-way, two-way or four-way entry. 5. Made of wood, plywood, metals, corrugated, plastic, etc. 6. Protects goods being moved from damage, pilferage, etc. 7. Facilitates inventorying. 8. Promotes cleanliness and good housekeeping.

9. Keeps material off floor, therefore easier to handle. 10. Used for:

Fork-truck-based systems.

Unitizing items.

Utilizing building cube.

Increasing load size.

Reducing handling of individual items.

Minimizing packaging of individual items.

Rack-a framework designed to facilitate the storage of loads, usually consisting of upright columns and horizontal members for supporting the loads, and diagonal bracing for stability.

1 May be classified as Selective: A

Bolted

Lock-fit

cantilever

Bar stock

A frame

Custom or Bulk: . A Drive-in

Drive-through

Live or Portable:

Integral unit

Rigid

Knock-down

Collapsible

Pallet stacking frame i2r Bolt-on

Snap fit-Independent of pallet

2. Made of metal, wood, pipe, etc. 3. May be fixed or adjustable in shelf height. 4. Usually built for pallets, but may be used or adapted for skids, rolls, drums, reels, bars, boxes, etc. 5. May have shelves for storage of loads, but may be designed for drive-in or drive-through applications. 6. Facilitates inventory taking. 7. Rugged; minimum maintenance 8. Live racks are designed for loads to flow to the unloading position. 9. Cantilever racks best for long items. 10. Used for:

Increasing utilization of storage space

Increasing selectivity of goods stored

Protecting goods

Control of inventory

Improving housekeeping. 10.15 SUMMARY

Principles and factors of layout are discussed. Product layout and process layout are explained In detail. Advantages anddisadvantages of these layout types are discussed. A three step procedure for evaluating process layout and the linebalancing technique for product layout are explained. Principles of materials handling and the common materials handlingequipment like conveyors, cranes and trucks are discussed in this lesson. 10.16 KEY CONCEPTS Process layout Product layout Hybrid layout Fixed position layout Space requirement by a centre Closeness rating Block plan Production line Assembly line Lifting and lowering devices Transportation devices Conveyors Cranes Hoists Monorails Trucks 10.17 MODEL QUESTIONS

1. What are the principles of a good layout? 2. What is product layout? Give its advantages and disadvantages. 3. What Is process layout? Give its advantages and disadvantages. 4. What are the principles of materials handling? 5. Briefly Identify four basic types of handling equipments. Indicate examples for each.

10.18 REFERENCE BOOKS 1. Apple, J.M., "Plant layout and materials handling", Prentice Hall. 2. Moore, F.G., "Plant layout design", John Whieley. 3. Krajewski and Ritzman, "Operations management", Addison-Wesley. 4. Buffa, "Modern production management", 4th edition. John Whieley.

END OF CHAPTER

LESSON -11

HUMAN FACTORS IN JOB DESIGN

11.1 Preamble 11.2 Man-machine systems 11.3 Man versus machines 11.4 Conceptual Frame work for man-machine systems 11.5 Types of man-machine systems 11.6 Information input 11.7 Visual displays 11.8 Auditory and tactual display 11.9 Human control of man-machine systems 11.10 Analysis of control activities 11.11 Strength and forces of body movements 11.12 Speed and accuracy of motor responses 11.13 The working environment 11.14 Temperature, Humidity and air flow 11.15 Noise 11.16 Light 11.17 Contaminants and Hazards in the working environment 11.18 Summary 11.19 Key concepts 11.20 Model questions 11.21 Reference books

11.1 PREAMBLE Over the years since Adam Smith, the main guide for

determining job content has been division of labor. This idea has been accepted almost completely. Adam Smith specified no limit to the division of labor and the principle has been applied as a one-way mechanism to achieve the maximum benefits of job design. Jobs have been broken down to the point where the worker finds little satisfaction in performing his tasks. In recent years there has been a reaction against excessive job breakdown; a few investigators have found that combinations of operations to create Jobs of greater scope recaptured the worker's interest; increase in productivity, quality level, etc., were reported.A new term, job enlargement, appeared. Practical applications of job enlargement that were written up in the literature tended to verify the findings of the investigators. Unfortunately, although exponents of job enlargement recognize that division of labor can be carried too far, they have not been able to specify any principles or guides on how far to go in the other direction. Job enlargement is also a one-way mechanism. It does, however, provide a balancing force through the inclusion of job satisfaction as a major criterion of successful job design. The ultimate answer lies in research attempts to Isolate the factors that determine an optimal combination of tasks to make up jobs. This effort has been called job design. The past and present viewpoint of business and Industry emphasizes the economic criterion as the controlling factor In determining job content and considers other criteria as effective mainly in so far as they meet economic requirements. Thus, a quality criterion often reduces to an economic one, when the job design that improves quality levels also improves productivity. For example, removing fatiguing elements of a job commonly improves productivity; eliminating hazards may reduce insurance premium rates as well as Improve productivity; designing task that increase employee satisfaction often also improves productivity. However, there certainly are instances where the various sub criteria do not correlate with the economic criterion. To obtain higher quality levels often demands increased costs, and the value of the reduced scrap may not counterbalance the higher labor costs. The employee satisfaction criterion would not necessarily decrease costs. To reduce the risks of hazards to extremely low levels might be very costly. In Taylor's time the noneconomic criteria would have been shrugged off. Today jobs and methods are frequently designed or altered to meet noneconomic needs. It is true that the economic

criterion is dominant, and job and method designs are seldom set or altered without reference to the effects on costs. Most often, costs are regarded as the "quantitative" measure, with noneconomic criteria being considered in the list of intangible" advantages or disadvantages. Fig 11.1 shows in schematic form the relationship of Job constraints, criteria and others. The inputs to the determination of Job methods then become job content plus a host of other inputs related to man-machine systems.

11.2 MAN-MACHINE SYSTEMS The great advances in computers and automation technology

has changed the conceptual framework for man in productive systems. While there is still a great deal of manual labor in business and industry today, most work involves the use of at least some kind of mechanical aid, and, therefore, the conceptual framework of man-machine systems is appropriate for the entire spectrum of systems involving the human operator. Even in an automated system, labor is necessary in a surveillance capacity. In such situations, an operator may be seated in front of a control board which continually flashes information about the progress of the manufacturing process. It is important that these display panels be designed to transmit the essential information with minimum error. Perhaps the majority of business and industrial manual jobs today consist of some combination of man and machine. Where there is a fixed machine cycle as in most machine tool processes, the design of the machine cycle as in most machine tool processes, the design of the machine in relation to the operator is of great importance. The location and design of controls, working heights, information displays, the flow of work, safety features, and the utilization of both the man and the machine in the cycle are all important determinants of quality, productivity, and worker acceptance of the job situation. Many jobs are strictly manual, such as assembly, maintenance, and heavy labor. Here mechanical aids or tools are common, and we need to consider the design of these tools from the viewpoint of the user. In addition, we must consider the layout of the workplace, the flow of work, and physical and mental fatigue produced in the worker by his physical environment. In some situations, environmental factors of heat, humidity, light, noise, and hazards can seriously affect fatigue, productivity, quality, health, and worker acceptance of the Job. Thus, in studying man-machine systems we assume that the questions of job content have fairly well been settled, and we concentrate attention on the detailed design of jobs. 11.3 MAN VERSUS MACHINES Man has certain physiological, psychological, and sociological characteristics which define both his capabilities and his limitations in

the work situation. These characteristics are not fixed quantities but vary from individual to individual. This does not mean, however, that we cannot make predictions about human behavior. Rather, it means that predictive models of human behavior must reflect this variation. To take a physical factor as an example, the distribution of the arm strengths of men indicates the per cent of the male population that can exert a given force. This distribution also indicates the limitations in demand for arm strength. The average man can exert a right-hand pull of 50 Kg. If we design a machine lever that requires the operator to exert this force, approximately half of the male population would be unable to operate the machine. On the other hand, the distribution also tells us that about 95% of the male population can exert a right-hand pull of 22 Kg. A lever designed to take this fact into account will accommodate a large proportion of the male population. In performing work, man's functions fall into three general classifications: (i) Receiving information through the various sense organs, that is, eyes, ears, touch, etc. (ii) Making decisions based on information received and information stored in the memory of the individual.

(iii) Taking action based on decisions. In some instances, the decision phase may be virtually automatic because of learned responses as in a highly repetitive task. In others, the decision may involve an order of reasoning and the result may be complex. Note that the general structure of a closed-loop automated system is parallel in concept. Wherein lies the difference? Are automated machines like men? Yes. they are in certain important respects. Both have sensors, stored information, comparators, decision makers, effectors, and feedback loops. The differences are in man's tremendous range of capabilities and in the limitations imposed on him by his psychological and sociological characteristics. Thus, machines are much more specialized in the kinds and range of tasks they can perform. Machines perform tasks as faithful servants, reacting mainly to physical factors; for example, bearings may wear out because of a dusty environment. But man reacts to his

psychological and sociological environment as well as to his physical environment. The latter fact requires that one measure of effectiveness of job design must be worker acceptance or job satisfaction. Although there are few really objective guides to the allocation of tasks to men and machines on other than an economic basis, a subjective list of the kinds of tasks most appropriate 'for men and for machines is given by McCormick to: Human beings appear to surpass existing machines in their ability (i) Detect small amounts of light and sound. (ii) Receive and organize patterns of light and sound. (iii) Improve and use flexible procedures. (iv) Store large amounts of information for long periods and recall relevant fact at the appropriate time. (v) Reason inductively, (vi) Exercise judgment, (vii) Develop concepts and create methods. Existing machines appear to surpass humans in their ability to: (i) Respond quickly to control signals, (ii) Apply great force smoothly and precisely. (iii) Perform repetitive and routine tasks, (iv) Store information briefly and then erase it completely. (v) Perform rapid computations. (vi) perform many different functions simultaneously. Such lists raise a question. Why do business, industry, and government not use men and machines according to these guides? We have all observed that man is used extensively for tasks given in the list for machines. The answer lies in the balance of costs for a given situation. Both labor and machines cost money; when the balance of

costs favors machines, conversions are normally made. In many foreign countries extremely low-cost labor, in relation to the cost of capital, dictates an economic decision to use manual labor in many task in which man is not well suited. Because of relatively high wages in the United States, machines are used much more extensively. 11.4 CONCEPTUAL FRAME WORK FOR MAN-MACHINE SYSTEMS As we noted previously, men and machines perform similar functions in accomplishing work tasks though they each have comparative advantages. The functions they perform are represented in Figure 11.2. The four basic classes of functions are sensing, information storage, information processing, and action. Information storage interacts with all three of the other functions; however, sensing, information processing, and action functions occurs in sequence.

Information is received by the sensing function. If by a man, sensing s accomplished through the various sense organs of eyes, ears, sense

of ouch, etc. Machine sensing can parallel human sensing through electronic or mechanical devices. Machine sensing Is usually much more specific or single purpose in nature than broadly capable human senses. Information storage for man is in the human memory or by access to records. Machine information storage can be by magnetic tape or drum, punched cards, cams and templates etc. The function of information processing and decision takes sensed and/or stored information and produces a decision by some simple or complex process. The processing could be as simple as a choice between two alternatives, depending on-input data, or very complex. Involving deduction, analysis, or computing to produce a decision for which a command is issued to the effector. The effector or action function occurs as a result of decisions and command, and may involve the triggering of control mechanisms by man or machine or a communication of decisions. Control mechanisms would in turn cause something physical to happen such as moving the hands or arms, starting a motor, increasing or decreasing the depth of a cut on a machine tool, etc. Input and output is related to the raw material, or the thing being processed. The output represents some transformation of the input. The processes themselves may be of any type, that Is, chemical processes to change shape or form, assembly, transport, clerical and so on. Information feedback concerning the output states is an essential Ingredient for it provides the basis for control. Feedback operates to control the simplest hand motion through the senses and the nervous system. For machines feedback concerning the output states provides the basis for machine adjustment. Automatic machines couple the feedback information directly so that adjustments are automatic (closed-loop automation). When machine adjustments are only periodic based on information feedback, the loop is still closed but not on a continuous and automatic basis.

11.5 TYPES OF MAN MACHINE SYSTEMS We shall use the module of the functions performed by man or machine shown in figure 11.2 to discuss the basic structure for three typical systems: manual, semiautomatic, or mechanical and automatic systems. Figure 11.3 uses the module of figure 11.2 to show the structure of the three types of systems in schematic form. Manual system involves man with only mechanical aids or hand tools. Man supplies the power required and acts as controller of the process; the tools and mechanical aids help multiply his efforts. The basic module of figure 11.2 describes the functions where the man directly transforms input to output as shown in figure 11.3(a). In addition

legible? Are black numbers on a white background superior to white on black? How big should letters and numerals be and what proportions of lie thickness, height, and width are best? How should systems of dials be arranged? Experimental work has been carried on these and many other questions. Scientists have experimented with the shape of dials. An experiment around five types of dials was constructed. Fig. 11.5 shows the results in terms of percentage of errors recorded. A multitude of studies, indicated the following general guides on dial design.

(i) A dial about 70mm to 80mm in diameter is probably the best all-around size if we are going to read it at a distance of 750mm or less. (ii) Mark should be located at the 0, 5, 10, 15, 20, etc. (or 0, 50, 100, 150, 200 etc.) positions. The marks at the 0, 10, 20 for 0, 10, 20 for 0, 100, 200) positions should be longer than those at the 5, 15, 25 (or 50, 150, 250) positions. Only the mark at the 0, 10, 20 should be numbered. (iii) The distance between the numbered markers should be about 12 mm as measured around the circumstances of dial. (iv) The separation between the scale markers should be the same all around the dial. (v) There should be gap between the beginning and the end of the scale. (vi) Values on the scale should increase in a clockwise direction. When there is a bank of dials to be read, it helps to orient them in a pattern so that the normal readings are in the nine o’clock or twelve o’clock position. This makes it possible to tell at a glance if an abnormal reading is among the group instead of reading the each dial individually. As a matter of fact we often find that the operator is presented with too much information. He may not need to read the dial at all. Perhaps all that is required is simple recognition of whether the reading is in the normal operating region or not. Or perhaps the real need is to know only if something is functioning or not. Simple on-off lights may be satisfactory in such situations. There is also the questions of the letters and numbers that are used on visual displays. Studies have indicated that capital letters and numbers are read much accurately when stroke width to height ratio is between 1:6 and 1:8 and when the overall width to height ratio is about 2:3 11.8 AUDITORY AND TACTUAL DISPLAYS

While auditory displays are not as commonly used as visual, they have particular value as warning devices or to attract attention. There are of course other opportunities for using the auditory channel, for example, when vision is impaired, or at night or in photographic dark rooms, when vision cannot be used. Some of the common devices are bells, sirens, buzzers, horns, chimes and whistles. Tactual displays are even less common than auditory in business and industry. Yet there are applications when vision cannot be used such as in photographic dark rooms or the shape coding of control knobs. So they can be identified by touch. 11.9 HUMAN CONTROL OF MAN-MACHINE SYSTEMS Given information input by direct or indirect means the human operator qf a man-machine systems responds by performing work in the physical sense. He may be assembling objects, manipulating controls and in general using his body to accomplish the required tasks to fit in with the objectives of the system. The analysis of the hand and body motions and how they contribute to effective operation is important Manipulative activity in handling controls has been studied with considerable care and this knowledge can be used to design effective systems. Finally, work place layout can be used on knowledge of anthropometry so that manual motions can take place within a prescribed area and chair and table heights can be set at levels appropriate to human body sizes. 11.10 ANALYSIS OF CONTROL ACTIVITY The .design of controls and control system has an important impact on the effectiveness of a man machine system. Knowledge of the forces that man can exert may be of importance in some systems so that these capabilities are not exceeded in the design of controls and

control coding is sometimes important so that controls arc not confused. 11.11 STRENGTH AND FORCES OF BODY MOVEMENTS Data on the forces that can be exerted by most of the working population is important for designing machines and tools which do not require operators with unusual physical strength. Rather exhaustive population measurements have been made for arm strength, grip strength, turning strength, elbow, back leg- strength. In general it can be seen that left hand strength is consistently less than that for the right hand, and that pushes and pulls are weaker when the arm is down at the side. With upward and downward movements, however, greater forces can be exerted when the arm is down at the side. Pull is slightly better than push, down slightly better than up, in better than out. 11.12 SPEED AND ACCURACY OF MOTOR RESPONSES A motor response is one that involves physical movement and /or control of body parts. It is a muscular activity. Since man's hands are his most important asset for performance of muscular tasks, we find that most of the available data pertain to hands. Thus, in designing tasks that involve positioning elements, for e.g.. a knowledge of where in the work area positioning can be accomplished most accurately may affect the work place layout. Positioning elements: Much experimental effort has gone on to determine how positioning elements of various types can be best accomplished. A number of interesting results have been found, some expected and some unusual. It has been shown that where some sort of mechanical guide or stops are used to establish the exact final desired position of the part or hand. The amplification of this fact tend to corroborate the idea of a fixed and definite location for everything. The rapid typing speeds attained by the touch system are based partially on this fact

since key locations are fixed. Conceptually, it is the difference between finding something in a carefully Indexed and maintained file or in a stack of papers. Positioning through setting of dials, cranks and hand wheels: Movements to position dials, knobs, cranks, hand wheels are common means by which the human operator controls processes and machines. Several studies have been made to determine facts that optimize the design of such devices. For e.g. when knob settings must be accomplished without visual control, the average errors and variability of settings are minimised at the 12 'o' clock position of the dial. A set of experiments have been performed to determine optimal sizes of cranks and hand wheels under various conditions of friction torque, position and height. These types of hand wheels and cranks are common devices used to move the carriages and cutting tools to desired settings. Coding controls: In complex operations where a number of controls are used, coding" by colour, size shape or location helps to distinguish between them so that mistakes are minimised. It was found that round knobs could be distinguish from each other. The location of controls can be used to distinguish them from each other. For example the clutch brake and accelerator pedals of automobile used without looking to see where they are. It has been also investigated knob shapes that could be distinguished solely by touch. He classified designs into 3 groups: Multiple rotational knobs, Fractional rotational knobs and detent positioning, that Is where knob position is critical as a television channel selected dial where each position 'clicks' in to place. Work area limits : Many tasks such as assembly work the operation of many types

of machines, and much clerical work are performed by worker is seated or standing at a bench, table or desk. Movements beyond the work area require the trunk of the body to be moved. For repetitive operations these trunk movements are fatiguing. Similar measurements have been made in vertical plane; guides for location of the materials, supplies tools and controls are available in 3-dimensions. Chair and table heights : Since there is so much manual and clerical activity, the height of chairs and tables is Important. The two are closely related. Table height is commonly specified In relation to elbow, so that adjustments In either chair or table height from the floor can be made to give greatest comforts to Individual worker. Actual table and chair heights then depend on whether the setup is designed for sitting - standing or sitting only. 11.13 THE WORKING ENVIRONMENT The working environment which includes such factors as temperatures humidity, light and noise can produce marked effect on productivity, errors, quality levels, and employee acceptance, as well as physiological well- being. Therefore we cannot measure the effectiveness of the Job design without knowledge of the working environment in which it will be placed. It Is a part of total picture. 11.14 TEMPERATURE, HUMIDITY AND AIR FLOW We have all experienced that our feeling of comfort Is not determined solely by thermometer reading. If there is a breeze we feel cooler, even though the temp is same. On a stifling day we have heard of the comment “It isn’t the heat, it's the humidity." The sensation of warmth or cold is affected by each of these factors, which have been combined into a single psychological scale called effective temperature. Effective temperature is the temperature of still, saturated air, which gives the identical sensation of warmth or cold as the various combinations of air temperature humidity and air movement would.

The human body has automatic heat regulating system that allows compensation for the environment over a certain effective temperature range. This compensation also, of course, depend on the activity level. Thus, a higher activity level can produce body comfort at lower temperature. Control of thermal atmosphere: A scientist experimented with protective clothing for workers who must operate In very hot atmospheres such as near industrial furnaces. He found that simple protective clothing actually increased the heat stress. However, a ventilated suit, through which a continuous air flow was maintained, reduced the heat stress considerably. Control for workers adjacent to hot areas such as furnaces, where heat radiation Is main problem, can be accomplished by shielding and by isolating the hot spot. General thermal control is accomplished through air-conditioning but is not universally done. 11.15 NOISE Unwanted sound is commonly called as Noise. There is growing evidence that it can produce damaging effects, especially when workers are exposed to it over a. period of years. Noise effects on work performance: Industry of course has been interested In the possible direct effects that high noise levels may have on performance measures such as output, errors and quality levels. In a number of studies on this subject, the general result was that if the injection of noise in the environment had any bad effects, they were temporary. We should note that good experimental design is difficult in such situations

because the experiments usually must go on over a period of time; It is difficult to know whether the results are attributable to noise effects or due to other changes which may have taken place during the same time interval. The one sure reaction is that higher noise levels are annoying, but human beings seem able to adapt to them. Noise Control: Noise control can be accomplished in many ways depending on the nature of the problem. Acoustical engineers often control it in the source, by redesigning the noise producing parts by using vibration isolation mounting of equipment, or sometimes isolating the source of noise through the construction of proper enclosures so that the amount of noise transmitted beyond the enclosures is reduced. In the, later method, a knowledge of physics of sound transmission is Important. The wrong enclosure design might transmit the noise with little or no loss or might even amplify it. Other forms of control are baffles, sound absorbers, and acoustical wall materials. Sound absorbers can be installed near or above noise sources to help reduce noise levels. Acoustical wall materials can be used to reduce noise levels within a room by reducing reverberation, the reflection of sound waves back and forth in the room. Of course these wall materials have no effect on the original sound waves emanating from the source. 11.16 LIGHTThe conditions for seeing are important aspects of the working environment. However no universally accepted standard for lighting is available, although there are recommended levels from many sources. Part of the difficulty lies in the fact that various criteria have been used, such as visual acuity, blink rate, preference rating, and critical illumination levels. From a business and industrial view point critical illumination level makes the most sense, since they are essentially performance types of criteria. The critical level for a given task is that level beyond which there is practically no increase in performance for increases in illumination intensity. Thus increase in intensity beyond these levels is assumed to be of no value. Illumination effect on work performance:

There have been many laboratory studies of the effect of illumination level on some measure of performance of a task. In general there is a rapid improvement in performance as illumination levels increase to critical level, at which point performance measures level off and further increases in illumination produce little or no improvement in performance. In many actual work situations where illumination levels have been increased, records of output and quality before and after the changes have' indicated substantial improvements. Some studies report that output went up to 4 to 35 %. We should be aware of this type of support data. However, in the complex set of conditions existing in a business or industrial environment, variables other than just the illumination level could very well have changed such as work methods, product design, control procedures, supervision, the weather, and the psychological climate.For example, in the famous Hawthorne studies, at the haw throne works, western electric company, lighting values were increased for an experimental work group and the performance went up. Some one thought to check on the result by lowering intensities. The employees cooperated again by lowering performance. But performance increased again when employees were told that the light intensity had been increased when actually it had been lowered, and then the smiles drained. It was finally realized that the employees were reacting to the psychological situation. They were experimental subjects, set aside from "ordinary" employees, and unconsciously were simply being very cooperative for those "nice experiments". When the situations were understood, the direction of the study changed to an evaluation of factors Glare can reduce the effectiveness of the illumination provided; glare is produced by some bright spot in the visual field, such as bright light or reflected light from a polished surface, and can cause discomfort as well as reduce visual effectiveness. Based on the experimental results, the effect of glare become acute when the sources are close to the line of sight Glare effects can be reduced by moving light sources where possible by diffusing light source that cannot be moved, or by Increasing the general illumination level of the surroundings so that the brightness

contrast between the glare source and the surrounding is reduced. Reflection surface may sometimes be moved in relation to work places or changed so that the surfaces diffuses light Criteria for the lighting environment: There is little doubt that it is worthwhile to provide at least the general critical levels of illumination. Although there is little evidence of any changes in performance above the critical levels, these levels may be exceeded without any known bad effects in order to allow for a margin of error. This idea seems to represent current practical philosophies. General illumination levels that are more than adequate are provided and the problem is forgotten. Often missed, however, is the need for special lights for fine detailed work and elimination of glare. 11.17 CONTAMINANTS AND HAZARDS IN THE WORKING ENVIRONMENT A large number of fumes, gases, liquids, and solids have proved harmful to workers. These, together with the general mechanical hazards from machining parts, traffic from material, transportation, falling objects, etc., from a part of the working environment Noxious substances: The number of industrial poisons Is tremendous. Fortunately, however, in most situations only a few would be present and potentially dangerous. Industrial medicine is a special field which concerns itself with the diagnosis, treatment and control of the noxious substance. Maximum available concentration (MAC) have been determined for most of these substances as a basis for proper control. Control procedures: Control procedures vary greatly because great variation of possible

contaminants and their characteristics. In general the control of emissions of these substances in manufacturing process poses engineering problems. Protection of workmen require exhaust system to collect dust gases and vapours in order to maintain the concentration below maximum allowable concentration. Personal protective gear, such as respirators and gas masks, supplement exhaust system. Other protective clothing, such as rubber aprons, coats, gloves, boots and goggles, is available for various jobs which involve the handling of chemicals and where the unprotected skin may leave the employee exposed to injury. In addition, vigilance through careful explanation of safe operating procedures and safety programs is common.

Please use headphones 11.18 SUMMARY Men and machines perform similar basic functions in accomplishing work; however, their abilities are sharply divergent in the nature of tasks each can do well. The essence of man's great advantage lies in his flexibility, whereas, machine can perform consistently. In general man's role in man-machine system falls in to three main classes: as a power source and controller in manual systems, as a controller of semi-automatic systems and as a monitor of automatic system. 11.19 KEY CONCEPTS Man versus machine Visual display Auditory display Tactual display Working environment 11.20 MODEL QUESTIONS 1. Compare man's capabilities with those of known machines.

2. What are the various ways that visual and auditory information can be coded? 3. Summarise the general guides for dial design. 4. What sort of information is available concerning the speed and accuracy of positioning elements? 5. What kind of control measures are available for the thermal environment? 6. How can noise be controlled? 7. What are glare effects and how can they be controlled? 11.21 REFERENCE BOOKS 1. Buffa, "Modern Production Management". 4th edition, Prentice Hall. 2. Buffa, "Modern Production/Operations Management". 7th edition, Prentice Hall. 3. McComick, E.J., "Human Factors in Engineering", McGraw Hill.

END OF CHAPTER

LESSON -12

PRODUCTION CONTROL

12.1 Preamble 12.2 Need for production control 12.3 Objectives of production control 12.4 Functions of production control

12.5 Relationship between production control and other departments 12.6 Types of production 12.7 Distinction between intermittent and continuous production 12.8 Characteristics of intermittent production 12.9 Pros and Cons of intermittent production 12.10 Characteristics of continuous production 12.11 Pros and Cons of continuous production 12.12 Similar processes 12.13 Characteristics of similar processes 12.14 Loading 12.15 Scheduling and controlling of production 12.16 Scheduling 12.17 Scheduling procedure and techniques 12.17.1 Perpetual scheduling 12.17.2 Order scheduling 12.17.3 Loading by schedule periods 12.18 Progress control 12.19 Methods to take corrective action 12.20 Follow-up or expediting 12.21 Summary 12.22 Key concepts 12.23 Model questions 12.24 Reference books 12.1 PREAMBLE

Production control is the factory's nervous system. Almost all factories can perform a tremendous variety of operations and turn out various types of products. Yet nothing happens until it is directed to the shop what it has to do. The directions have to be minute and specific. These directions tell it to perform Individual operations on all kinds of component parts and to put them together into finished products. Production control sends the necessary continuous stream of directions to all parts of the factory. Production control is defined as the design and use of a systematic procedure for establishing plans and controlling all the elements of an activity. That is the main problem in production control are involved with

1 designing a sound and systematic procedure

1 properly using the system that has been designed

The production control includes a complete plan ii. a follow-up procedure for determining how closely the plan is followed a means of regulating execution to meet the plan's requirements 12.2 NEED FOR PRODUCTION CONTROL Products are manufactured by the transformation of raw materials into finished goods. This is how production is achieved. Planning looks ahead anticipates possible difficulties and decides in advance as to how the production is carried out. Control phase makes sure that the programmed production is constantly maintained. Production control is an on-going activity designed to strike a balance between several conflicting objectives. To focus on any one single objective will lead to a suboptimal situation. For example if inventory cost is minimized customer service will probably suffer. Costs will be higher than if optimal balance of all factors is attained.

Holding down inventory is one goal. That is ideally try to finish making product just in time to be sold but no sooner. But some inventories have to be carried out the factory operate economically. If the volume is big products can be made continuously at a steady rate and hold inventory. It takes time to make products and this fact also is to be considered while achieving minimum cost. Both continuous and lot production decide ahead how much to produce and when. If it is guessed what customers will buy and when, running out of some products and having too many of others happen. To complicate matters customers may change their minds. They may want more products than they first ordered or they want fewer. They want their orders sooner or they want them latter. They want to change the design of their product. 12.3 OBJECTIVES AND BENEFITS OF PRODUCTION CONTROL Sound production control may result in many tangible and intangible benefits if properly installed and operated. In order to obtain these benefits, it is- essential that adequate auditing of the system be made continuously. Following are some of the objectives and results of a sound production control system. (i) Efforts can be directed into those production areas that will contribute most towards accomplishing A given objective.(ii) Programs can be closely followed to the wants and needs of the company.(iii) Manufacturing cycles are shortened which in turn reduces in-process Inventory costs and provides better customer service.(iv) Work must be performed according to the preplanned schedules.(v) Supervisors are forced to take corrective action when it is necessary.(vi) Information is provided quickly to customers concerning the status of their orders. (vii) Over-all expenses are reduced because of systematizing and reducing the amount of paper work Involved.(viii) Production is maximised by making greater use of facilities, equipment and manpower through sound, scheduling and loading.(ix) Necessary information can be provided for determining where and when preventive or corrective action is necessary.(x) A yardstick is provided by which management can measure both the progress and the effectiveness of the activities in which the company engages.(xi) Administration of the activity is put on a factual basis rather than

one of experienced guesswork.(xii) Reports are more timely, adequate and accurate.(xiii) Continuous evaluation of the effectiveness of the planning and control system and of other function is made possible.(xiv) Graphical or visual presentation of data is facilitated.(xv) Time becomes available to work out details that would otherwise be left to improvisation.(xvi) Time phasing of all elements of the activity becomes a necessity.(xvii) More flexibility is obtained to accommodate necessary changes that occur in schedules or orders. 12.4 Functions of productions Control The functions of production control may be divided into three main categories or phases. 1. The planning phase 2. The action phase 3. The follow-up or control phase

Planning Phase

1. Prior Planning 2. Action Planning Planning is a course of action established in advance. Prior planning is an activity in advance of normal planning stages not generally considered to be the part of the production control department. Action control consists of material control, tool control loading and scheduling. Forecasting Forecasting is an estimation of future activities. It is a basis for projection of work load In future. It Includes long range and short range objectives and provides the basis for establishing future requirements for men, materials, machines, time and money. It is subjected to possible wide variations in accuracy. Order writingOrder writing is to control the work. lt must begin with a specified document authorizing it. It is the preparation of work authorization. Documents may be a manufacturing order, customer order, etc. Product design Product design is the preparation of specifications. After the work authorization has been prepared, next step is to collect all information necessary to describe the work to be done. This will include blue print, drawings, etc. This activity would come under the product engineering department. Process planning routing, Process planning is the preparation of work detail plan. The function of preparation work detail plan consists of two parts (i) determination of most economical methods of performing an activity - process planning

(ii) determination of where the work is to be done – routing For process planning it is necessary to have following Information. (i) volume of work to be done (ii) quality of work required (iii) equipment, tools and facilities available to do the work (iv) personnel available to do the work (v) schedule to show when the equipment, tools and personnel will become available Routing is normally dependent on the plant or activity workload. Materials control Materials control is the determination of material requirements and control of materials. Materials or inventory control is vital to an activity because of the necessity to assure sufficient raw materials to satisfy production needs and finished products to satisfy customer needs. For these reasons it is desirable to maintain optimum Inventory levels at all times. Tool control Tool control is the determination of tool requirement and tool control. Tool control may be subdivided into two categories

2 design and procurement of new tools3 control, storage and maintenance of tools after procurement

Loading or routing Loading is the determination and control of equipment and manpower requirements. In most activities loading function is combined with routing and scheduling. It is very difficult to distinguish or to separate these functions. Usually these functions are considered simultaneously. Loading may be defined as assignment of work to a facility. Facility can be equipment, manpower or both.

Scheduling Scheduling is the determination of when work is to be done. Scheduling consists of time phasing of work load. That is setting both the starting and ending time for the work to be done. Many different techniques are used in scheduling. The common practice is that routing, loading and scheduling are performed simultaneously. Action phase Only one function exists in the action phase. Dispatching Dispatching is starting the work. It is a transition from planning phase to action phase. It consists of actual release of detailed work authorization to work center. It is commonly performed by an individual called dispatcher. In the formal production control function, dispatching is commonly performed by an individual called dispatcher. In the informal system, dispatching may be done by the foreman or supervisor or may even be done verbally. Every job that goes to department goes through the dispatcher. Dispatching is the first step in the line of communication from the work center to production function. Follow up or control phase Once the work is started it is to be evaluated continuously regarding progress in terms of plan. Any deviation can be detected and corrected quickly.Follow up phase consists of two parts

4 progress reporting5 corrective action

Progress reporting or activating

It is primarily a matter of communication. Timely, adequate and accurate information about the performance of an activity is furnished by this function. Data is collected regarding what has actually happened in the activity. Data is gathered and communicated to the management. In the formal activity, dispatcher is the originating point of communication. When there is no dispatcher, foreman or supervisor is the originating point of communication. After collecting data, it is necessary to interpret it by comparing the actual performance against the plan. System must be designed in such a way that they must almost automatically evaluate the situation for management. Management should not be required to interpret the raw data in order to come up with the evaluation. Corrective action The whole process of production control would be defeated if corrective action was called but not taken. Corrective action may consist of one or both of the two courses of action that is, expediting and replanning. Expediting In this function current work corrections are made. If the data from the production unit initiates that there is a significant deviation from the plan then some action must be taken to get back on plan (if plan cannot be changed). Progress report should indicate the reasons for the deviation in the formal system. The function of following up to eliminate the cause of deviating from plan is performed by expediting group. In the informal system, the function is usually performed by the person directly in charge of the activity such as foreman or supervisor. Obviously, no production control system is perfect, and therefore some expediting will always be required. However it should be minimized by continuously improving the production control system. Replanning

Replanning is making plan corrections. It should be emphasized that a plan is not made to be changed, but to be followed. However, if after expediting to correct deviations, it is found that it is impossible to perform according to the plan, it would be foolish to attempt to continue with original plan. It may also be found that there were errors made while developing the plan. It may also be found that there were errors made while developing the plan. In these cases changes in the plans are necessary. The changes in the original plan should never be made just because of deviations. Careful analysis is always required. 12.5 RELATIONSHIP BETWEEN PRODUCTION CONTROL AND OTHER DEPARTMENTS There are many important relationships which exist between production control and other elements of the organization. The most important of these are: (i) sales department (ii) purchasing department (ill) traffic department (iv) materials handling function (v) plant engineering and maintenance (vi) new product development (vii) industrial engineering Without the coordination of production control with these groups, it would be impossible for production control to operate effectively. It is vital that the designer of the production control system understands what the relationship is and assures that there is a proper co-ordination and communication between production control and the various co-ordinating functions. Production control men first do their own work (preparing direction) and second get other departments to do their work (carrying out direction). Where one department has to

issue directions covering the work or other departments, trouble sometime arises. Minor frictions and frustrations are common. 12.6 TYPES OF PRODUCTION To understand the job of controlling production, it is needed to look into the various manufacturing situations being controlled. There are so many differences in products and in methods how they are made. It is not possible to analyze the manufacturing situations of all the products individually. So classes or .groups of manufacturing situations are considered. Most manufacturing situations fall reasonably well into three groups (i) companies in job lot work - intermittent production (ii) mass production companies - continuous production (ill) similar processes - batch production The first group makes a wide variety of products, each in limited quantities. The second group makes big volumes of a limited variety of products. In the third group the quantities to be made are in lots or batches. A survey was carried out by the American Management Association to find out how prevalent each kind of operation is. Survey was-conducted with a large number of manufacturing companies about what kind of operations they carried on. 20% said job lot work and rarely made a second order 13% said job lot work and usually no reorder 46% said job lot work and many products made again and again 13% said mass production basis 8% said processed materials In batches It can be considered that the last two together as being In highly repetitive production then 34 of factories surveyed were In Job let work and 14 were In mass production. 12.7 DISTINCTION BETWEEN INTERMITTENT AND

CONTINUOUS PRODUCTION Intermittent and continuous production differs in the length of time during which equipment setups can be used without change. If you use a machinery setup for only a short time and then change it to make a different product, you are In Intermittent production. Perhaps you are able to use the machine setup for only a few or a few hours before the required quantity is produced. If you setup equipment and use it without change for months, we call that continuous production. 12.8 CHARACTERISTICS OF INTERMITTENT PRODUCTION (i) Most products are made In small quantities. Parts and assemblies are made in lots, usually small lots. (ii) Similar equipment is grouped. Similar kinds of machines or machines performing the some work are located together in single work areas or departments. A department is a place that does a certain kind of work not a place where a certain product is made. This arrangement is called "process controlled layout". (iii) Workloads are unbalanced. Departmental workloads are usually unbalanced. It may be found that some departments working overtime while others are on short hours. Or within a department you may find some machines working overtime while others are on short hours or are idle. This is not because anyone wants it that way. It happens because the machines you own reflect usual need, but day-to-day & week-to-week variations In the product mix result in different demands for specific machines. Which machines are idle and which are overloaded depends on the variations in the product mix. (iv) General purpose machines are used. The term 'general' is relative because all general purpose machines are to some extent specialized machines. You can't use a band saw to drill holes and you don't use a drill press to polish flat surface or to apply paint. We call a drill press a general purpose machine because by changing drill bits, It can be used to drill holes of various diameters and depths. Important point is that you can use it for different jobs. You have to drill each hole separately & you can drill big or little holes, shallow or deep & can be drilled wherever it is needed.

(v) Machine operators are highly skilled because of short runs which

usually happen with general purpose machines. Often setting up of machines for new jobs happens. Setup man has to select the proper tools and fasten them on the machine in exactly the right way. He must figure out & install holding and fastening arrangements for the product. Finally the operator has to put the products onto machines and do the operation both setting up and operating take skill and experience. Foreman need to be skilled operators because you expect them to be able to step in and show their best workers how to do "difficult jobs. (vi) Numerous job instructions are necessary. Specific Instructions usually in writing, telling them what to do on every new job have to be given to machine operators, truckers and others. You have to tell them what materials to use, what quantities to process, what operations to perform and when and where to perform them. You have to tell them how good the products have to be in order to pass inspection. Such Instructions have to be given over and over again for every lot of materials. All this makes for much clerical work. (vii) Raw materials Inventories are high. Use of any particular raw material is somewhat irregular. A relatively large stock of standard raw materials have to be kept in hand. (viii) In process inventories are high. Almost always you finish one operation on every item in a lot of products before you start the next operation. The first item finished lie around until all the rest are done. Then completed lot waits for trucker. When he delivers the order to next machine, he parks the lot nearby because that machine may be busy. There it waits until the machine is free. Other orders may already be waiting & so the newly arrived order may have to be stored for days before its turn comes. Other delays caused by shortage of tools. Inspection delays, etc. slow things still more. Job lot work means materials move through production line slowly and you always have big inventories in process. (viii) Materials move by truck. Conveyers are rarely found in Job shop. Materials follow a great variety of paths through these plants. Power driven or hand trucks are used to move materials. Trucking is a highly flexible method of transportation and is well suited to move things through diverse paths. (ix) Wide aisles, ample storage and numerous elevators are needed

when materials are moved by trucks. Enough aisle space is needed for two-way traffic and for maneuvering space so that loads can be put down or picked up at machines. Temporary storage space is needed next to machines so that workers can unload materials directly from truck and back again afterwards. Large permanent storage areas should be available in order to store jobs between operations. Elevators used to move items to other floors. It should be large enough to carry trucks & there should be enough of them so that trucks don't have to wait long. Wide aisles sample storage space, though needed, are not always found because space is often scarce but if you don't have them, you will waste a lot of time & money in moving things around in crowded areas. 12.9 PROS AND CONS OF INTERMITTENT PRODUCTION The best thing about intermittent production is its flexibility. It is well adapted to producing numerous orders for small quantities of a wide variety of products. Flexibility will be there in the plant layout, types of machines used, transportation system, skills of workers & procedures used to direct their work. One machine breaking down is not usually serious. Work planned for that machine can be shifted to other similar machines. Orders requiring that machine can't be shifted. Only the orders requiring it are held up. Orders using other machines are not delayed. Intermittent production also allows to push emergency rush orders through ahead of regular orders. Flexibility of intermittent production is a kind of insurance against heavy losses if the market demand changes unexpectedly. Most general purpose machines cost less than special purpose machines. First investment in intermittent manufacturing is usually lower than in continuous manufacturing. If big orders received, some of the savings that ordinarily go with special purpose machines can be lost. Continuous production requires high volume & nearly complete standardization. If you don't have these two conditions, intermittent production is the only practical method. 12.10 CHARACTERISTICS OF CONTINUOUS PRODUCTION

Continuous production factories make a limited of products in large quantities. Plants are usually large.(i) Large volume and small variety are essential in continuous production. The quantity produced must be great enough to allow the same equipment setup for month’s to-gether. We can say that continuous production plants are gigantic, single purpose machines. Years ago Charles F. Keffering of General Motors said "we don't manufacture automobiles, we publish them". Continuous manufacturing in fabricating industries is a duplicating process. Decide on the origin.il model, set up the equipment to make it in quantities and then run off hundreds of thousands or millions of copies. But even large companies do not have such complete standardization and enough market to absorb the output of a continuous production plant for very long period. Even large companies have to change now and then or more commonly provide for minor variations in style or design or products. A few variations don't cause serious problems. (ii) Production lines are used. Machines required for successive operations on the product are placed side by side. Machines are lined up according to the sequence of operations required on the product. This is called a 'straight line' production and the movement of the product dictates the layout 'as product layout'. (iii) Machine capacities are balanced in continuous production. Materials move from operation to operation in a steady stream. The capacity of successive operations must be balanced. If one operation takes longer than the others it will be a bottleneck if you don't equalize their production capacities. (iv) Special purpose machines are used. The machines are designed and build to do one specific operation. A special purpose machine will do one operation rapidly and almost perfectly & requires little skill on the part of the operator. (v) Machine operators are not highly skilled and fewer operators are needed for a given volume of output. Most machines used in continuous manufacture are almost fully automatic. Operator is only to load and unload the machine. Continuous manufacturing requires relatively unskilled men since special purpose machines are fast and automatic. Only one man is needed to operate several machines.

(vi) High skill is needed behind the scenes. Although specialized machines require little operator skill, they require a very high degree of skill on the part of the machine designers and machinery makers. They require highly skilled maintenance men. Some of the machinery is so complicated that maintenance men need special training. Perhaps the training have to be given at machinery materials plant. (vii) Few Job instructions are necessary in continuous manufacturing. Few changes occur after the first instructions are given. Workers need almost no day-to-day instructions but first instructions telling workers how to do their jobs are sometimes given in great detail. Once the men learn the job no more instructions are needed. (viii) Raw material inventories are low. Raw materials are used in steady rate and in large quantities. This allows to setting raw material delivery schedules so that new supplies are received and no need to carry much on hand. Some companies carry so little raw materials that when new supplies arrive they are delivered directly to the first operation & not to stockroom. Automatic companies sometimes work with only one or two hours bank if their supplier is located nearby. Occasionally companies producing continuously carry low inventories of raw materials. This occurs in companies using rubber or grain because their source raw material is sometimes very far away & is not wholly dependable. Besides they have to contend with seasonality. Someone has to carry rubber and grain inventories after the harvesting season until they are used. Also when the prices go down companies lay in big supplies. Except In such cases continuous manufacturing companies rarely carry big inventories. (ix) In-process inventories are low. Inventories of materials going through factory is almost dominated in continuous manufacturing. As soon as an operation on a piece of material is finished, the price goes right onto next operation which is performed almost immediately. Machines performing successive operations will be close-by. (x) Preventive maintenance and quick repair are musts because there is so little float (material moving down the), if one' machine stops all stop. As the successive operations are tied together, a good job of preventive maintenance & of quick repair must be done. Otherwise the line's downtime is to use preventive maintenance, inspect, overhaul & repair machines during off-hours before anything happens.

Tool wear, in particular, needs watching. If a drill or a thread taper gets dull from wear it will cut improperly. The result will be either nonstandard work or a broken tool. Either is bad. (xi) Materials move rapidly through the plant. Materials in process keep moving except for small emergency stocks in a few places. Partly processed materials never pile up ahead of operations. Once started the first operation, materials keep moving & soon emerge as finished products. (xii) Materials move by conveyer. Mechanical conveyers are the cheapest way to move things wherever large quantities follow the same paths. (xiii) Medium or narrow aisles, little storage space and few elevators are needed. Utilization of floor space by machines & conveyers is nearly complete in continuous manufacturing. Since trucks are rarely used, aisles can be narrower than they are in intermittent manufacturing. Elevators are scarce because conveyers take things up & down. 12.11 PROS AND CONS OF CONTINUOUS PRODUCTION The best thing about continuous production is its low unit cost when you have large volume & nearby complete standardization. Special purpose machines speed up the job& cut labor costs. Output is more and cuts down operator’s time. No waste of man's time going after materials and for materials handling. No machine setup frequently. There is a big savings in labor cost. There will be saving from the higher output per worker and not from lower hourly pay rates. Bad features of continuous production are vulnerability to work stoppages, rigidity of output rate, product changing difficulties and investment commitment. 12.12 SIMILAR PROCESSES In this method of operation, the work being performed is similar nature from order to order, but not identical.

12.13 CHARACTERISTIC OF SIMILAR PROCESSES The characteristics which distinguish the similar process are as follows:1. The product or end result of the work is highly standardized.2. The order or work quantity is usually very large.3. The type of equipment required, if any, is usually highly specialized.4. Equipment is laid out by the type of end product.5. The materials handling equipment may be both mobile and permanent installation conveyer.6. The end-product inventory is relatively low.7. The required worker skills are relatively low because of the repetitiveness of the work.8. It is relatively easy to supervise the workers.9. Relatively few job instructions are required because of the similarity of the work.10. Prior-planning is essentially completed at one time and is relatively easy compared to the prior-planning required on custom and job-order types of process.11. Control of the process is relatively easy because of the repetitiveness.12. There is some degree of flexibility but not as great as in the custom and job-order types of process.13. The cycle time Is relatively short.14. The balancing of the work load, is relatively difficult because the work is laid out according to the end product of the work.15. A relatively high equipment Investment is required in manufacturing operations.16. Disruptions in the flow of work usually result in a considerable amount of lost production. 12.14 Loading or routing Loading means assignment of work to manpower, machinery etc., without specifying when the work is to be done. Loading results in a tabulated list or chart showing the planned utilization of the machines or work stations in the plant as shown in

The objectives of the loading function is to maintain an up to data picture of the available capacity in the plant. Loading can be defined as the study of the relationship between load and capacity at the where work is done. The information provided by loading is used. (1) to ensure the efficient utilization of the plant and labour in a factory. (2) to help in the setting of reliable delivery promises,

(3) and to assist in the forward planning of the purchase of new plant.

Aims of loading (1) To check the feasibility of production programs (2) To assist in the efficient planning of new work (3) To assist in balancing the plant to the existing load (4) To assist in the fixing of reliable delivery promised A load chart as shown in fig. 12.1 shows the productive capacity that has been sold and at the same times the available

productive capacity. Load chart may be prepared for each machine or a group of machines available in the factory. Load charts, as such, are not too common because loading function is usually combined with scheduling and only one see of charts is maintained that is, the schedule charts. 12.15 SCHEDULING AND CONTROL OF PRODUCTION Once the planning to meet sales is complete and a set of decisions have been formulated using Graphical or Linear programming methods the next step is the implementation of the decisions through detailed plans and schedules. Schedules are made for the use of facilities like equipment and manpower. Scheduling and control of production focus attention on the following: (a) Knowing the total overall production targets - how to determine the amount of each product to be manufactured if there are products of different types and sizes? (b) How to decide about and deploy work force and equipment to achieve the target production rate? (c) How to determine individual work assignments? (d) What should be the information system to feed back quickly and accurately the actual output duly compared with the scheduled one? Scheduling and control of production have one stage in between them, which is "known as dispatching. In general, first of all the order is scheduled, then it is dispatched for necessary operation and lastly the progress of the order is tracked, to be certain that the schedule is being met. This phase of tracking the progress of an order and making corrections is known as control of production. 12.16 SCHEDULING In brief, scheduling means - when and in what sequence the work will be done. It involves deciding as to when the work will start and in a certain duration of time how much will be finished. Scheduling deals with orders and machines, i.e., it determines which order will be taken up on which machine and in which department by which

operator. While doing so, the aim 13 to schedule as large amount of work as the plant facilities can conveniently handle by maintaining a free flow of material along the production line. Scheduling may be called as the time phase of loading. Loading means the assignment of task or work to a facility whereas scheduling includes in addition, the specification of time and sequence in which theorder /work will be taken up. A production schedule is similar to a railway time table and shows which machine is doing what and when. A production schedule, is a statement of target dates for all orders or operations in hand and reveals their starting and finishing dates. Scheduling finalizes the planning phase of Production Planning and control system. The following factors affect production scheduling and are considered before establishing the scheduling plan. (a) External Factors : 1. Customer’s demand 2. Customer’s delivery dates and 3 Stock of goods already lying with the dealers and retailers (b) Internal factors : 1. Stock of finished goods with the firm 2. Time interval to process finished goods from raw material. In each component, subassembly and then assembly 3. Availability of equipment and machinery: their total capacity and specifications 4. Availability of materials, their quantity and specifications 5. Availability of manpower 6. Additional manufacturing facilities if required, and

7. Feasibility of economic production runs

Please use headphones 12.17 Scheduling Producer and Techniques Scheduling normally starts with the master schedule. Fig.12.2 shows the master schedule for a foundry shop.

A master schedule resembles central office which possesses information about all the orders in hand. Master schedule, in fig.12.2 is a weekly breakdown of the production requirements. The total capacity in any work is of 100 hours of work in the foundry shop. As the orders are received, depending upon their delivery dates they are marked on the master schedule. When the shop capacity is full for the present week the newly acquired orders are carried over to the next week and so on. A master schedule is thus updated continuously, it depicts a running total of the production requirements and shows the work ahead - yet to be completed. Master schedule is actually the basis for all subsequent scheduling techniques.

A Master Schedule possesses the following advantages, disadvantages and applications. Advantages: 1. It is simple and easy to understand 2. It can be kept running 3. It involves less cost to make it and maintain 4. It can be maintained by non-technical staff, and 5. A certain percentage of total weekly capacity can be allocated for rush orders Disadvantages 1. It provides only overall picture, and 2. It does not give detailed information Applications It finds applications: 1. In big firms, for the purpose loading the entire plant 2. In Research and Development organizations, and 3. For the overall planning in foundries, computer centers, repair shops, etc. After framing the overall picture of production requirements through a Master Schedule chart, the detailed schedules are thought of and made for each component and subassemblies so that all parts are available at the time of assembly. There are a number of visual

aids and techniques, both in the form of conventional charts and commercially available boards, which aid in detailed scheduling. The technique to be employed for scheduling purposes depends upon the type of production, type and frequency of tasks, demand patterns, etc. A useful scheduling device normally portrays planned production, actual performance and their comparison. Actually, the Gantt chart forms the basis of commonly used scheduling techniques Some of the techniques employed for Loading and Scheduling purposes are:

the horizontal firm lines. Cursor set at today's date shows that machine 3 is working as per schedule. Machine 2 started work on order B-260 before the scheduled date and the progress is very good. Machine 1 which completed the order A-372 In time, for some reasons could not take up the order C-390. From the above Gantt charts the progress of various orders and machine loading can be seen at a glance. Order C-390 has fallen behind the schedule and needs expediting. Machine-1 is loaded up to the middle of February, however machine-2 is available for the third week of February, whereas Machine-3 can be booked only after the middle of March. Making a Report of work accomplishment: 1. The progress report should contain the following information in order to evaluate actual performance against the anticipated plan and to take corrective action, it any: (i) Job Identification. It includes order number and operation number. (ii) Time of report, and (iii) Work completed 2. A progress report should contain absolute minimum of Information. 3. Progress Reporting Time. Progress can be reported: (i) at fixed intervals of time, I.e., weekly, monthly, or yearly depending upon the project duration; (ii) after the work has been completed, or after each stage of the work Is completed; it depends upon the size of the work; (iii) by using the principle of 'Management by Exception'; According to which, one reports only those things and at that time when they require an action'by the planning group. It is assumed that unreported events are going as per the schedule.

Transmission of Report: The progress report may be transmitted by employing any one of the following systems:

6 Written system (pre-written papers),7 Oral system (telephone, radio, etc.), and8 Electronic system (telautograph, teletype equipment, etc.)

Written system: Advantages: (1) It provides a record for future reference.

(2) The chances of misinterpreting the report are minimized, and (3) good amount of necessary Information can be supplied. Disadvantages: (1) There are chances of papers being misplaced in transit' (2) Generally, it takes more time for the report to reach the other end; (3) File keeping is necessary; and (4) There is a tendency to send large amount of Information. Oral system: Advantages (1) Progress can be reported in no time (2) Doubts, if any, can be clarified instantly, and (3) File work is very much minimized

Disadvantages (1) There is no detailed record for future reference (2) There are more chances of misinterpreting the report, and in addition (3) Only brief Information can be sent Electronic System: Advantages (1) It possesses all the advantages of the written system and (2) Progress can be reported much faster Disadvantages(1) Equipments required are costly, and (2) Trained operators are needed Based upon the above systems the commonly used techniques for sending progress reports are: Pre-written or Pre typed papers. These are sent through messengers from one department to another. Pre-written papers using pneumatic tube equipment. Papers are put inside a capsule, which is then placed inside a tube, running from one department to another. The capsule is shot by air to its destination. Teletype Equipment. It has a key board similar to a typewriter. Pressing different keys gives rise to electric signals which are transmitted to receiving stations where the message is recorded.

Telephone and Intercommunication Equipment

Radio and Loudspeaker. They are especially useful for outdoor applications to control the movements of materials handling equipments and earth moving machinery. Closed circuit T.V. It is employed for keeping an eye over the processes emitting harmful radiations. Corrective Action: Factors creating the need for corrective action are, External Factors: These factors are beyond the control of the organisation; for example: 1. Change In the priority of orders due to the arrival of some new orders or due to the cancellation of a few previous orders: 2. Delay In receiving equipments, tools, or raw material. This may be due to strike or theft at the vendor's end or due to the reasons that the raw material which arrived earlier was substandard and hence, was returned for replacement; 3. Unexpected rush orders. Internal Factors: These factors results from within the organisation; for example: 1. Labour turnover or mass absenteeism, 2. Lack of necessary Instructions and materials, 3. Late staring of the work, tea breaks, etc. 12.19 METHODS TO TAKE CORRECTIVE ACTION Schedule Flexibility:

It means keeping the schedule flexible to accommodate unexpected events. Planning is done only for a percentage of the total working time and the remaining time is kept free to take care of the unexpected jobs. The percentage of time kept free for rush order, etc., is decided from the past experience. Capacity Modification: The following three methods can be employed for modifying the capacity of an organisation: (a) Changing the number of working hours, either by employing more workers or by using over-time with the same number of workers (b) Changing the amount of work within the plant by appropriate MakeBuy decisions or by subcontracting the work to others.

Schedule Modification: If the situation is otherwise non-manageable even after adopting the above mentioned measures, the previously established plan can be modified to suit the new set of conditions. 12.20 FOLLOW-UP OR EXPEDITING The manufacturing activity of a factory is said to be in control when the actual performance is as per the planned performance. Follow up or expediting regulates the progress of materials and the components through the production process. Follow up serves as a catalytic agent to fuse the various separate and unrelated production activities into the unified whole that means progress. Follow up is concerned with the reporting of production date and the investigating of any deviation from the predetermined production schedules. Follow up ensures that the promise is backed up by performance.

The work within the organisation can be expedited by the following two principles:

9 The exception principle and10 The fathering principle

In exception principle, the scheduling group, explores the jobs behind the schedule. The expediting group takes up such jobs, procures necessary materials, tools, etc.. i.e., solves all problems related to these jobs and intimates the scheduling group to reschedule them. According to fathering principle each expediter is made responsible for a job or a group of jobs for which he arranges the tools, materials, equipment, etc. Such a system works very well for controlling large projects. 12.21 SUMMARY Production control is essentially a systematic procedure. Effective production control is depending upon a soundly designed system and proper evaluation and auditing of its use after proper installation. Production control consists of three phases, the planning phase, the action phase and the follow-up phase. Type of process is one of the most important factors in determining the type of production control system. Loading and scheduling is one of the most important phases of any production control system. It is a technique by which the overall coordination of various functions and facilities is accomplished. It is also essential that the difficulties Involved in progress reporting be thoroughly understood. 12.22 KEY CONCEPTS Forecasting Order writing Product Resign

Loading Scheduling Progress reporting 12.23 MODEL QUESTIONS 1. Describe the functions of production control. 2. Discuss the characteristics of intermittent type of production. 3. What is continuous production? Explain its characteristics. 4. Indicate the principle limitations of master scheduling. Under what type of situation it would be used? 5. Explain the perpetual loading method. 6. Discuss the reasons why progress reporting is so important to production control. 7. Explain the method of progress reporting. 12.24 REFERENCE BOOKS 1. Buffa, "Modern production Management", 4th edition, John Wiley 2. Eilon, Samuel, "Elements of Production Planning and Control" 3. Schele, Westerman and Wimmert, "Principles and -design of Production Control Systems", Prentice Hall. 4. Moore, F.G., "Production Control", Prentice Hall.

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