Facilities Planning, Location, Layout and Movement of Materials

Management Science II Dr.T.T.
Narendran
MODULE 3
Facilities Planning, Location, Layout And Movement Of

Materials
Factors To Be Considered For Selection Of Region
• Primary Factors
• Market nearness
• Raw-material availability
• Labour availability
• Transport availability
• Power and fuel supply
• Existence of similar firms
Secondary Facorst
• Climate suitability
• Character of the inhabiting community
• State and local taxation-rates
• Expansion facility
• Decentralization suitability
Selection Of Locality
• City Rural Area

• Cheap land
• Avenue for expansion
• Low taxes
• Buildings less costly
Indian Institute of Technology Madras

Management Science II Dr.T.T.Narendran
• Fewer operating restrictions

• Simpler labour relations
• Absence of allied industry
• Absence of skilled labour
• Absence of transport & public utility
• Absence of banking (less)
• Restricted local market
Ample Market
Skilled Labour
Nearness to allied industry
Public utility services
Transport
Banking & Finance
Education
Recreation
High cost
High tax
Restrictions

• Suburban – via media
• Industrial Estates
• Selection of site
– breakeven analysis
Pic1
Layout – Other Forms

• Cellular Manufacturing Systems
• Fixed Position Layout
Pic 2
• What do we see in this figure ?
• Machines arranged like a product

• layout
• Smooth flow of work
• Less movement of materials
The logical question is :
• How do we form groups ?

• Broadly there are three ways to do it
• Visual inspection
• Use your experience, technical knowledge and identify the part families
that require the same kind of machines
• Process Flow Analysis (PFA)
• Study the route card and group the machines that process the same parts
• Part Characteristic Analysis (PCA)
• Code and classify parts or
• Analyze part features to form part groups
Numerical Methods For Cell Formation

Basis Numerical representation of the processing of a component by a
machine in a machine-component incidence matrix (MCIM)
Source of data Route card
Matrix rows <=> machines

columns <=> components.
Wherever a component requires processing on an machine, the entry in the

matrix is ‘1’, otherwise the entry is ‘0’.

Here is a typical incidence matrix
Components
1 2 3 4 5 6 7
1 1 0 0 1 1 0 1
Machines
2 0 1 1 0 0 1 0
3 1 0 0 1 0 0 1
4 0 1 1 0 1 1 0
5 0 0 0 1 1 0 1
Numerical methods use the machine - component incidence matrix as the basic
input data and proceed to identify cells and component families.
Amongst the several methods available, this programme introduces two

methods, viz.
• Rank - Order Clustering
• A ‘similarity’ - based method
‘ROC’ works for “perfectly groupable” matrices only
• Rarely found in reality
Hence the need for better methods.
These are based on
• Similarities

• Cluster Analysis
• Array - Sorting
• Graph Theory
• Mathematical Programming
• Pattern Recognition
Method based on ‘Similarity’

‘Similarity’ can be measured as the extent to which two machines / parts have
common parts to process / machines required.
Consider the same example :
Components
1 2 3 4 5 6
Machines 1 1 1 1 0 0 1
2 1 0 0 1 1 0
3 0 1 1 0 0 1
4 1 0 0 1 1 0
s12 = similarity between m/c 1&3

= no. of common elements in 1&3
=5
Similarities between all pairs of machines are :
Machines
1 2 3 4
Machines 1 - 1 5 1
2 1 - 0 6
3 5 0 - 0
4 1 6 0 -

Start with each m/c. Trace its most similar m/c. Go

to that row and repeat until you come back to the starting point
This is the result :
Machines
1 2 3 4
1 - 1 5 1 1-3-1
2 1 - 0 6 2-4-2
M
ac 3 5 0 - 0
hi
ne
4 1 6 0 -
s
Group (2,4) in one machine cell and (1,3) in another machine cell.
(2,4) takes part family (1,4,5) and (1,3) takes part family (2,3,6).
Here is the solution :
Components
1 4 5 2 3 6
Ma
2 1 1 1 0 0 0
chin 4 1 1 1 0 0 0
es
1 1 0 0 1 1 1
3 0 0 0 1 1 1

A few “home truths”
Perfectly groupable matrices rarely exist.
Intercell moves are inescapable.
It is not easy to identify the ‘best’ set of groups.
Cell formation using numerical methods with
0-1 matrices are used at a preliminary design stage only.

0-2
• Intercell move :
The processing of a part by a machine outside its group
Why do intercell moves happen?
Common facilities :
• Heat treatment, Plating / process shop,
• Painting
Costly machines :
• CNCs, Heavy duty presses
What should we do ?
• Live with them !
• Change technology
• (Laser beam for heat treatment)
• Buy additional machines - (expensive)
• Change process

• Subcontract
• Change product design - (concurrent engg.)
How do we evaluate groups ?
• no. of intercell moves
• no. of 0’s inside a block
• composite measures
e.g., grouping efficiency
Methods For Layout

Qualitative
A Absolutely necessary
E Especially Important
I Important
O Ordinary Closeness is OK
U Unimportant
X Undesirable
Some well-known Qualitative Methods
ALDEP Automated Layout Design Program

CORELAP Computerized Relationship Layout Planning ALDEP

Steps
• Randomly select 1 dept – place it in the plan
• Scan the rest – select 1 with A/E – place next

[No A or E ?......Random !]
Continue…
• Convert ratings, Compute total score
• Repeat, many times, with different starting points
Aldep Generate ‘Good’ Layouts - Not Optimal
Fgfgf
Assumption Of Layout Models
• Cost & Flow data exist for unknown conditions
• Material Handling (MH) Costs, linear, incremental, assignable to activities
• MH Cost –the only significant factor
Deterministic flow data
Cost Elements
Purchasing, installing, maintaining
Operating
Difference in WIP due to MHs

Other costs due to differences in MHs
Steps In Layout Design

• Formulation
• Analysis
• Search for alternatives – Selection
Guidelines
• Exert effort
• Don’t get bogged down by details too soon
• Question liberally...
• Seek Many alternatives
• Avoid conservatism, premature rejection
• Satisfaction
• Consult others, Think differently, Group approach, Beware of limitations
Plant Layout – Quantitative Approach

Quadratic Assignment Problem (Qap)
Minimize Ζ = ∑∑∑∑ Cijkl X ij X kl

i J k l
Subject to ∑X
i
ij =1 ∀ j
∑X
j
ij =1 ∀ i

Note:
i,k for m/c s

j,l for locations
Objective function reflects load- distance
QAP is an “np-complete” problem
Solved by empirical methods, e.g.
Computerized Relative Allocation of Facilities
CRAFT (1963)..upto 40 depts.
Plant Layout – Quantitative Approach (Cont..)

Inputs: Cost matrix, initial layout
Procedure:
• Find distances between centroids

• Compute cost of layout
• Evaluate ‘pair wise exchanges’ – choose the best
• Print result
• Repeat until no further reduction
-is an ‘improvement type’ heuristic

-sensitive to initial layout
- Other methods Genetic Algorithm, Simulated Annealing etc
Wimmert’s Method For Plant Layout (Qap)
Assumption
• Individual areas interchangeable (not always)
• Distance moved independent of direction (ok)-FMS
• Cost in directly proportional to distance moved

(ok for same type of MH equipment)
Example
Wimmert’s Method For Plant Layout (Qap) (Cont..)

Facilities Planning, Location, Layout and Movement of Materials

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Management Science II Dr.T.T.

Facilities Planning, Location, Layout And Movement Of

Factors To Be Considered For Selection Of Region

• City Rural Area

Indian Institute of Technology Madras

• Fewer operating restrictions

Nearness to allied industry

Public utility services

Banking & Finance

Indian Institute of Technology Madras

• Suburban – via media

Layout – Other Forms

• Fixed Position Layout

• What do we see in this figure ?

• Machines arranged like a product

• Smooth flow of work

• Less movement of materials

The logical question is :

• How do we form groups ?

Indian Institute of Technology Madras

• Broadly there are three ways to do it

• Process Flow Analysis (PFA)

• Part Characteristic Analysis (PCA)

• Code and classify parts or

• Analyze part features to form part groups

Numerical Methods For Cell Formation

Source of data Route card

Matrix rows <=> machines

Wherever a component requires processing on an machine, the entry in the

Indian Institute of Technology Madras

Here is a typical incidence matrix

input data and proceed to identify cells and component families.

Amongst the several methods available, this programme introduces two

• Rank - Order Clustering

• A ‘similarity’ - based method

‘ROC’ works for “perfectly groupable” matrices only

• Rarely found in reality

Hence the need for better methods.

These are based on

Indian Institute of Technology Madras

Method based on ‘Similarity’

s12 = similarity between m/c 1&3

Indian Institute of Technology Madras

Start with each m/c. Trace its most similar m/c. Go

Indian Institute of Technology Madras

A few “home truths”

Perfectly groupable matrices rarely exist.

Intercell moves are inescapable.

It is not easy to identify the ‘best’ set of groups.

Cell formation using numerical methods with

0-1 matrices are used at a preliminary design stage only.

The processing of a part by a machine outside its group

Why do intercell moves happen?

• Heat treatment, Plating / process shop,

• CNCs, Heavy duty presses

• Live with them !

• (Laser beam for heat treatment)

• Buy additional machines - (expensive)

Indian Institute of Technology Madras

• Change product design - (concurrent engg.)

How do we evaluate groups ?

• no. of intercell moves