OPERATIONS MANAGEMENT

CHAPTER 3

FACILITIES LAYOUT

Learning Objectives
After going through this unit, you will be able to:
Create a proper layout for the facilities
Apply principles for creating good layout.
Differentiate between different layouts

Structure
3.1 Facilities Layout Concept
3.2 Principles Of Good Plant Layout
3.3 Types Of Plant Layout
3.4 Factors Influencing Layout
3.5 Layout Procedure
3.6 Key Words
3.7 Summary

3.1 Facilities layout Concept

Plant layout refers to the arrangement of physical facilities such as machinery,

equipment, furniture etc. within the factory building in such a manner so as to
have quickest flow of material at the lowest cost and with the least amount of
handling in processing the product from the receipt of material to the shipment
of the finished product.

According to Riggs, “the overall objective of plant layout is to design a physical

arrangement that most economically meets the required output – quantity and
quality.”

According to J. L. Zundi, “Plant layout ideally involves allocation of space and

arrangement of equipment in such a manner that overall operating costs are
minimized.
The efficiency of production depends on how well the various machines;
production facilities and employee's amenities are located in a plant. Only the
properly laid out plant can ensure the smooth and rapid movement of material,
from the raw material stage to the end product stage.

Plant layout encompasses new layout as well as improvement in the existing

layout. It may be defined as a technique of locating machines, processes and
plant services within the factory so as to achieve the right quantity and quality
of output at the lowest possible cost of manufacturing. It involves a judicious

48 | Page
 OPERATIONS MANAGEMENT

arrangement of production facilities so that workflow is direct.

Plant layout is an important decision as it represents long-term commitment.

An ideal plant layout should provide the optimum relationship among output,
floor area and manufacturing process. It facilitates the production process,
minimizes material handling, time and cost, and allows flexibility of operations,
easy production flow, makes economic use of the building, promotes effective
utilization of manpower, and provides for employee's convenience, safety,
comfort at work, maximum exposure to natural light and ventilation. It is also
important because it affects the flow of material and processes, labour
efficiency, supervision and control, use of space and expansion possibilities
etc.

Essentials of Plant Layout

An efficient plant layout is one that can be instrumental in achieving the

following objectives:

a) Proper and efficient utilization of available floor space

b) To ensure that work proceeds from one point to another point without any
delay
c) Provide enough production capacity.
d) Reduce material handling costs
e) Reduce hazards to personnel
f) Utilise labour efficiently
g) Increase employee morale
h) Reduce accidents
i) Provide for volume and product flexibility
j) Provide ease of supervision and control
k) Provide for employee safety and health
l) Allow ease of maintenance
m) Allow high machine or equipment utilization
n) Improve productivity

49 | Page
 OPERATIONS MANAGEMENT

Activity A: Visit any nearby office and list the factors they have considered
for designing the layout.

3.2 Principles of a Good Layout

It is not possible to define a good layout in few words, but there are certain
criteria which can be used to judge whether or not the layout is good. They
are :
A. Overall integration of factors - A good layout is one that integrates men,
materials, machines and supporting activities and others in a way that the
best compromise is obtained.

No layout can satisfy each and every principle of a good layout. Some
criterion may conflict with some other criterion and as a result no layout can
be ideal. It has to integrate all factors into the best possible compromise.
B. Minimum movement - A good layout is one that permits the minimum
movement between the operations.

The plant and machinery in case of product layout and departments in

case of process layout should be arranged as per sequence of operations
of most of the products.

Since straight line is the shortest distance between any two points, men
and materials as far as possible should be made to move along the straight
path.

A door may be made in a wall or a hole may be drilled in a ceiling if that

eliminates or reduces material handling in place of stairs or a distant door.

50 | Page
 OPERATIONS MANAGEMENT

C. Uni-directional flow - A good layout is one that makes the materials

move only in the forward direction, towards stage of completion, without any
backtracking.

Back-tracking and duplicated movements consume more time, involve

un-necessary materials handling, add to cost and lead to inefficiency
hence must be avoided.

Since straight line is the shortest distance between any two points,
materials as far as possible should be made to move on the principle of
straight line flow. And when straight line flow is not possible, other flows
like U-shaped flow, circular flow or zig-zag flow may be adopted, but the
layout must ensure that materials move in the forward direction.

To ensure forward flow, equipment if necessary may be duplicated.

D. Effective use of available space - A good layout is one that makes

effective use of available space both horizontal and vertical.

Raw materials, work-in-progress and finished goods should be piled

vertically one above another rather than being strewn on the floor.

Pallets or equivalents should be made use of to pile up several layers one

above another.

Area below the work tables or in the cupboards built into the wall are
welcome since they reduce requirement of space.

E. Maximum visibility - A good layout is one that makes men, machines

and materials readily observable at all times.

51 | Page
 OPERATIONS MANAGEMENT

All departments should be smoothly integrated, convenient to service

and easy to supervise.

Every piece of positioning or screening or partitioning should be

scrutinised and carefully planned.

Special cupboards, enclosures, offices, partitions etc. should be

avoided except when their utility is established beyond doubt.

F. Maximum accessibility - A good layout is one that makes all servicing and
maintenance points readily accessible.

Machines should be kept sufficiently apart and with reasonable clearance

from the wall so that lubrication, adjustment and replacement of belts,
removal of parts at the time of repairs etc. can be done conveniently by the
maintenance staff.

Area in front of electrical panels and fire extinguishers should be kept free
from obstructions.
G. Minimum handling - A good layout is one that reduces the materials
handling activity to its minimum.

Material should be stored as close to the point of use as possible.

Materials being worked upon should be kept at working height and never
placed on floor to avoid lifting.

Materials should not be handled twice in the same direction.

Materials should be handled in as bigger and convenient lots as possible.

A. Inherent safety - A good layout is one that makes the plant safer for the
workmen.
The aisles should be clearly marked and should be kept free from
obstructions.
The aisles should be located in such a way that workmen do not have to
walk close to chemical vats or furnaces or conveyors etc.
“Pick up” and “put down” points for the materials should be so located
that material handling facility - fork loft, overhead crane etc. do not
endanger safety of machines or workmen.
Fire protection equipments should be provided at strategic locations.
Gangways should be kept well lit.
One way traffic rule may be observed in areas of greater traffic.

52 | Page
 OPERATIONS MANAGEMENT

I. Maximum flexibility - A good layout is one that can be altered later

without much cost.
Future requirements should be taken into account while designing for
the present. Space requirements for different departments, direction of
expansion, etc. should be planned in such a way that changes may be
made without any disruption.

Each machine must be self-contained i.e. it must have everything of its

own like lubrication system. Cooling system, supplementary lighting,
air system etc.

Multipurpose machines give flexibility over special purpose machines

and process layout is more flexible than product layout.

Standardization of machine tools, jigs and fixtures, give flexibility to

production in the event of machine breakdown.

Activity B: Visit any nearby factory and list the principles they have used
for the layout.

3.3 Types of Layout

As discussed so far the plant layout facilitates the arrangement of machines,

equipment and other physical facilities in a planned manner within the factory
premises. An entrepreneur must possess an expertise to lay down a proper
layout for new or existing plants. It differs from plant to plant, from location to
location and from industry to industry. But the basic principles governing plant
layout are more or less same.

As far as small business is concerned, it requires a smaller area or space and

can be located in any kind of building as long as the space is available and it is
convenient. Plant layout for Small scale business is closely linked with the
factory building and built up area.
From the point of view of plant layout, we can classify small business or unit
into three categories:

A. Manufacturing units
In case of manufacturing unit, plant layout may be of four types:
a) Product or line layout
Under this, machines and equipments are arranged in one line depending

53 | Page
 OPERATIONS MANAGEMENT

upon the sequence of operations required for the product. The materials move
form one workstation to another sequentially without any backtracking or
deviation. Under this, machines are grouped in one sequence. Therefore
materials are fed into the first machine and finished goods travel automatically
from machine to machine, the output of one machine becoming input of the
next, e.g. in a paper mill, bamboos are fed into the machine at one end and
paper comes out at the other end.

The raw material moves very fast from one workstation to other stations with
minimum work in progress storage and material handling. The grouping of
machines should be done keeping in mind the following general principles.
a) All the machine tools or other items of equipment must be placed at the point
demanded by the sequence of operations
b) There should no points where one line crossed another line.
c) Materials may be fed where they are required for assembly but not
necessarily at one point.
d) All the operations including assembly, testing packing must be included in
the line

Advantages: Product layout provides the following benefits:

a) Low cost of material handling, due to straight and short route and absence of
backtracking
b) Smooth and uninterrupted operations
c) Continuous flow of work
d) Lesser investment in inventory and work in progress
e) Optimum use of floor space
f) Shorter processing time or quicker output
g) Less congestion of work in the process
h) Simple and effective inspection of work and simplified production control
i) Lower cost of manufacturing per unit

Disadvantages: Product layout suffers from following drawbacks:

a. High initial capital investment in special purpose machine
b. Heavy overhead charges

54 | Page
 OPERATIONS MANAGEMENT

c. Breakdown of one machine will hamper the whole production process

d. Lesser flexibility as specially laid out for particular product.

Suitability: Product layout is useful under following conditions:

1) Mass production of standardized products
2) Simple and repetitive manufacturing process
3) Operation time for different process is more or less equal
4) Reasonably stable demand for the product
5) Continuous supply of materials

Therefore, the manufacturing units involving continuous manufacturing

process, producing few standardized products continuously on the firm's own
specifications and in anticipation of sales would prefer product layout e.g.
chemicals, sugar, paper, rubber, refineries, cement, automobiles, food
processing and electronics etc.

b) Process or functional layout

In this type of layout machines of a similar type are arranged together at one
place.
E.g. Machines performing drilling operations are arranged in the drilling
department, machines performing casting operations be grouped in the
casting department. Therefore the machines are installed in the plants, which
follow the process layout. Hence, such layouts typically have drilling
department, milling department, welding department, heating department and
painting department etc. The process or functional layout is followed from
historical period. It evolved from the handicraft method of production. The work
has to be allocated to each department in such a way that no machines are
chosen to do as many different job as possible i.e. the emphasis is on general
purpose machine. The work, which has to be done, is allocated to the
machines according to loading schedules with the object of ensuring that each
machine is fully loaded.

The grouping of machines according to the process has to be done keeping in

mind the following principles.
a) The distance between departments should be as short as possible for
avoiding long distance movement of materials
b) The departments should be in sequence of operations
c) The arrangement should be convenient for inspection and supervision

55 | Page
 OPERATIONS MANAGEMENT

Advantages: Process layout provides the following benefits

a) Lower initial capital investment in machines and equipments. There is high
degree of machine utilization, as a machine is not blocked for a single product
b) The overhead costs are relatively low
c) Change in output design and volume can be more easily adapted to the
output of variety of products
d) Breakdown of one machine does not result in complete work stoppage
e) Supervision can be more effective and specialized
f) There is a greater flexibility of scope for expansion.

Disadvantages: Product layout suffers from following drawbacks

a. Material handling costs are high due to backtracking
b. More skilled labour is required resulting in higher cost.
c. Time gap or lag in production is higher
d. Work in progress inventory is high needing greater storage space
e. More frequent inspection is needed which results in costly supervision

Suitability: Process layout is adopted when

1. Products are not standardized
2. Quantity produced is small
56 | Page
 OPERATIONS MANAGEMENT

3. There are frequent changes in design and style of product

4. Job shop type of work is done
5. Machines are very expensive
Thus, process layout or functional layout is suitable for job order production
involving non-repetitive processes and customer specifications and non
standardized products, e.g. tailoring, light and heavy engineering products,
made to order furniture industries, jewelry.

c) Fixed position or location layout

In this type of layout, the major product being produced is fixed at one location.
Equipment labour and components are moved to that location. All facilities are
brought and arranged around one work center. This type of layout is not
relevant for small scale entrepreneur
Advantages: Fixed position layout provides the following benefits
a) It saves time and cost involved on the movement of work from one
workstation to another.
b) The layout is flexible as change in job design and operation sequence can
be easily incorporated.
c) It is more economical when several orders in different stages of progress are
being executed simultaneously.
d) Adjustments can be made to meet shortage of materials or absence of
workers by changing the sequence of operations.

Disadvantages: Fixed position layout has the following drawbacks

a. Production period being very long, capital investment is very heavy
b. Very large space is required for storage of material and equipment near the
product.
c. As several operations are often carried out simultaneously, there is
possibility of confusion and conflicts among different workgroups.

Suitability: The fixed position layout is followed in following conditions

1. Manufacture of bulky and heavy products such as locomotives, ships,
boilers, generators, wagon building, aircraft manufacturing, etc.
2. Construction of building, flyovers, dams.
3. Hospital, the medicines, doctors and nurses are taken to the patient
(product).

d) Combined or group layout

Certain manufacturing units may require all three processes namely
intermittent process (job shops), the continuous process (mass production
shops) and the representative process combined process [i.e. miscellaneous
57 | Page
 OPERATIONS MANAGEMENT

shops]. In most of industries, only a product layout or process layout or fixed

location layout does not exist. Thus, in manufacturing concerns where several
products are produced in repeated numbers with no likelihood of continuous
production, combined layout is followed. Generally, a combination of the
product and process layout or other combination are found, in practice, e.g. for
industries involving the fabrication of parts and assembly, fabrication tends to
employ the process layout, while the assembly areas often employ the product
layout. In soap, manufacturing plant, the machinery manufacturing soap is
arranged on the product line principle, but ancillary services such as heating,
the manufacturing of glycerin, the power house, the water treatment plant etc.
are arranged on a functional basis.

Another concept of mixed layout is called cellular layout in which the facilities
are clubbed together into cells to utilise the concepts, principles and
approaches of group technology. This layout makes it possible to adopt high
degree of automation even if the product variety is large and product demands
are not stable. In this layout, the facilities are grouped into cells which are able
to perform similar type of operations for a group of products.

B. Traders
When two outlets carry almost same merchandise, customers usually buy in
the one that is more appealing to them. Thus, customers are attracted and kept
by good layout i.e. good lighting, attractive colours, good ventilation, air
conditioning, modern design and arrangement and even music. All of these
things mean customer convenience, customer appeal and greater business
volume.
The customer is always impressed by service, efficiency and quality. Hence,
the layout is essential for handling merchandise, which is arranged as per the
space available and the type and magnitude of goods to be sold keeping in
mind the convenience of customers. There are three kinds of layouts in retail
operations today.

1. Self-service or modified self-service layout

2. Full service layout
3. Special layouts

The self-service layouts, cuts down on sales clerk's time and allow customers
to select merchandise for themselves. Customers should be led through the
store in a way that will expose them to as much display area as possible, e.g.
Grocery Stores or department stores. In those stores, necessities or
convenience goods should be placed at the rear of the store. The use of color
and lighting is very important to direct attention to interior displays and to make
the most of the stores layout.

58 | Page
 OPERATIONS MANAGEMENT

All operations are not self-service. Certain specialty enterprises sell to fewer
numbers of customers or higher priced product, e.g. Apparel, office machines,
sporting goods, fashion items, hardware, good quality shoes, jewelry, luggage
and accessories, furniture and appliances are all examples of products that
require time and personal attention to be sold. These full service layouts
provide area and equipment necessary in such cases.

Some layouts depend strictly on the type of special store to be set up, e.g. TV
repair shop, soft ice cream store, and drive-in soft drink stores are all examples
of business requiring special design. Thus, good retail layout should be the
one, which saves rent, time and labour.

C. Services centers and establishment

Services establishments such as motels, hotels, restaurants, must give due
attention to client convenience, quality of service, efficiency in delivering
services and pleasing office ambience. In today's environment, the clients look
for ease in approaching different departments of a service organization and
hence the layout should be designed in a fashion, which allows clients quick
and convenient access to the facilities offered by a service establishment.

Activity C: List advantages of product layout.

Activity D: List advantages of process layout.

3.4 Factors Influencing Layout

While deciding his factory or unit or establishment or store, a small-scale

businessman should keep the following factors in mind:
a) Factory building: The nature and size of the building determines the floor
space available for layout. While designing the special requirements, e.g. air
59 | Page
 OPERATIONS MANAGEMENT

conditioning, dust control, humidity control etc. must be kept in mind.

b) Nature of product: product layout is suitable for uniform products whereas
process layout is more appropriate for custom-made products.
c) Production process: In assembly line industries, product layout is better.
In job order or intermittent manufacturing on the other hand, process layout is
desirable.
d) Type of machinery: General purpose machines are often arranged as per
process layout while special purpose machines are arranged according to
product layout
e) Repairs and maintenance: machines should be so arranged that
adequate space is available between them for movement of equipment and
people required for repairing the machines.
f) Human needs: Adequate arrangement should be made for cloakroom,
washroom, lockers, drinking water, toilets and other employee facilities, proper
provision should be made for disposal of effluents, if any.
g) Plant environment: Heat, light, noise, ventilation and other aspects should
be duly considered, e.g. paint shops and plating section should be located in
another hall so that dangerous fumes can be removed through proper
ventilation etc. Adequate safety arrangement should also be made.

Thus, the layout should be conducive to health and safety of employees. It

should ensure free and efficient flow of men and materials. Future expansion
and diversification may also be considered while planning factory layout.

Dynamics of Plant Layout

Plant layout is a dynamic rather than a static concept meaning thereby if once
done it is not permanent in nature rather improvement or revision in the
existing plant layout must be made by keeping a track with development of new
machines or equipment, improvements in manufacturing process, changes in
materials handling devices etc. But, any revision in layout must be made only
when the savings resulting from revision exceed the costs involved in such
revision.

Revision in plant layout may become necessary on account of the following

reasons:
a) Increase in the output of the existing product
b) Introduction of a new product and diversification
c) Technological advancements in machinery, material, processes, product
design, fuel etc.
d) Deficiencies in the layout unnoticed by the layout engineer in the beginning.

Applicability of Plant Layout

Plant layout is applicable to all types of industries or plants. Certain plants
require special arrangements which, when incorporated make the layout look
distinct form the types already discussed above. Applicability of plant layout in
60 | Page
 OPERATIONS MANAGEMENT

manufacturing and service industries is discussed below. In case of the

manufacturing of detergent powder, a multi-storey building is specially
constructed to house the boiler. Materials are stored and poured into the boiler
at different stages on different floors. Other facilities are also provided around
the boiler at different stations.

Another applicability of this layout is the manufacture of talcum powder. Here

machinery is arranged vertically i.e. from top to bottom. Thus, material is
poured into the first machine at the top and powder comes out at the bottom of
the machinery located on the ground floor.
Yet another applicability of this layout is the newspaper plant, where the time
element is of supreme importance, the accomplishment being gapped in
seconds. Here plant layout must be simple and direct so as to eliminate
distance, delay and confusion. There must be a perfect coordination of all
departments and machinery or equipments, as materials must never fail.
Plant layout is also applicable to five star hotels as well. Here lodging, bar,
restaurant, kitchen, stores, swimming pool, laundry, shaving saloons,
shopping arcades, conference hall, parking areas etc. should all find an
appropriate place in the layout. Here importance must be given to cleanliness,
elegant appearance, convenience and compact looks, which attract
customers.

Similarly plant layout is applicable to a cinema hall, where emphasis is on

comfort, and convenience of the cinema goers. The projector, screen, sound
box, fire fighting equipment, ambience etc. should be of utmost importance.
A plant layout applies besides the grouping of machinery, to an arrangement
for other facilities as well. Such facilities include receiving and dispatching
points, inspection facilities, employee facilities, storage etc.

Generally, the receiving and the dispatching departments should be at either

end of the plant. The storeroom should be located close to the production,
receiving and dispatching centers in order to minimize handling costs. The
inspection should be right next to other dispatch department as inspections are
done finally, before dispatch.
The maintenance department consisting of lighting, safety devices, fire
protection, collection and disposal of garbage, scrap etc. should be located in a
place which is easily accessible to all the other departments in the plant. The
other employee facilities like toilet facilities, drinking water facilities, first aid
room, cafeteria etc. can be a little away from other departments but should be
within easy reach of the employees. Hence, there are the other industries or
plants to which plant layout is applicable.

Activity E: Visit any nearby Shop and list the factors that they have
considered for designing the layout.
61 | Page
 OPERATIONS MANAGEMENT

3.5 Layout Procedure

The overall layout design can be considered to be composed of four phases

viz.
Phase I : Plant Location
Phase II : General overall layout
Phase III : Detailed layout
Phase IV : Installation

These phases though appear to be sequential but there is always an

overlap among the different phases of the layout design. Major steps in the
layout design are as follows :
(i) Define objective and scope of the layout exercise.
(ii) Collect basic data (e.g. volume, rate of production, product specifications,
bill-of-material, process sheets, standard time for each operation).
(iii) Analyse operation data and process (i.e. present) data in the form of
various charts.
(iv) Design the production process (i.e. decide the equipment and machinery
required).
(v) Plan the material flow and select the material handling system.
(vi) Determine requirements of equipment and work centres.
(vii) Plan the individual work centres.
(viii)Select the material handling equipment.
(ix) Determine storage requirements.
(x) Establish activity relationships and prepare flow and/or activity
relationship diagrams.
(xi) Plan auxiliary and service facilities.
(xii) Calculate space requirement and allocate it to the concerned activities.
(xiii) Prepare general layout (block) plan.
(xiv) Develop detailed alternative layout plans.
(xv) Evaluate layout alternatives, modify, check and select the optimal layout
plan.
(xvi) Install the selected layout.
(xvii)Review.

Tools And Techniques For Layout Analysis

The development of good layout is dependent upon the quality and quantity of
data on various factors influencing the layout. Data needs to be collected
regarding various materials, processes, routing, material flow, space

62 | Page
 OPERATIONS MANAGEMENT

requirements, different activities and their relationships etc. Important tools

and techniques helpful in the layout analysis are as follows :

Process Charts - Two well known process charts are : Operation Process
Chart and Flow Process Chart.

Operation Process Chart is the graphic representation of the major activities

and entry point of materials. The chart depicts the major operations and
inspections performed on the materials.
Flow Process Chart sets out the flow and activities of a component/man
through a series of operations, inspections, transportations, delays and
storages. The chart also provides information on time and distance.

Diagrams - Diagrams are useful to -

study different layout alternatives and thereby select the most optimum
layout.
study the extent of traffic over the different routes of the plant.
identify extent of backtracking, cross traffic and obstacles encountered
during movement of materials.
study the activity relationships between departments/work centres.

Diagrams are of two types : flow diagrams and string diagrams.

Flow diagrams are the scale plans on which the movements of an object
(men/materials) are traced by lines. String diagrams are the scale plans on
which the movements of an object (men/material) are indicated by a string.

Travel Chart - Travel chart presents the quantitative data on material flow by
recording distance and frequency of movements between different pairs of
departments. Travel charts are prepared in process type of layouts and are
useful to determine the degree of closeness desired between different
departments in terms of material interaction. Efforts are made in layout design
to place those departments close to each other which have high degree of
material interaction and thereby minimise the materials handling.

REL Chart - REL chart is known as “Relationship Chart” and it exhibits the
relationship between pairs of departments in terms of degree of closeness
desired. The chart expresses the activity relationships as A(Absolutely
essential), E(Essential), I(Important), O(Ordinary), U(Unimportant) and
X(Undesirable).

63 | Page
 OPERATIONS MANAGEMENT

Templates - Templates are the two dimensional cutouts of card board (or
coloured paper). They are made to scale and are placed on the scaled plan of
the building drawn on a board, or on a cross hatched surface or on a graph
paper. Templates show the plan of the various activities like machine tools,
work benches, storage racks, fittings etc.

Templates offer number of advantages :

(i) The congestion, bottlenecks and backtrackings can be better visualised

with templates.
(ii) They can be conveniently move on the graph paper providing the
flexibility to evaluate various feasible arrangement of facilities.
(iii) They are less laborious and save lot of time which otherwise is spent
making drawings for each alternate plant layout arrangement.

Templates, however, have few limitations, namely :

(I) Overhead facilities can not be visualised.
(ii) Non-technical persons find it difficult to comprehend the arrangement.

Scale Models - Three dimensional models are the scale models of the
facilities resembling the actual in length, width and height. They are usually
made up of wood or plastic. Typical examples of the uses of three
dimensional models are layout plans of chemical factories, refineries etc.
Three dimensional models have numerous advantages :
(i) Non-technical persons find it easy to comprehend.
(ii) Overhead facilities can be shown.
(iii) Services such as lighting, ventilation, safety features can be easily
incorporated.
(iv) Like templates, models too can be shifted easily and quickly.

64 | Page
 OPERATIONS MANAGEMENT

3.6 Keywords

Locational analysis: Locational analysis is a dynamic process where

entrepreneur analyses and compares the appropriateness or otherwise of
alternative sites with the aim of selecting the best site for a given enterprise.

Gross materials: Gross materials are those which lose weight in the process
of transformation into finished goods.

Pure Material: Pure Material are those materials which add their weight to the
finished product in the process of manufacture

Plant Layout: Plant layout refers to the arrangement of physical facilities such
as machinery, equipment, furniture etc. with in the factory building in such a
manner so as to have quickest flow of material at the lowest cost and with the
least amount of handling in processing the product from the receipt of material
to the shipment of the finished product.

Product or line layout: Under this type of layout machines and equipment are
arranged in one line depending upon the sequence of operations required for
the product. The materials move form one workstation to another sequentially
without any backtracking or deviation.

Process or functional layout: In this type of layout machines of a similar type

are arranged together at one place. E.g. Machines performing drilling
operations are arranged in the drilling department, machines performing
casting operations be grouped in the casting department.

Fixed position or location layout: In this type of layout, the major product
being produced is fixed at one location. Equipment labour and components
are moved to that location. All facilities are brought and arranged around
one work center.

3.7 Summary

The facilities planning process is concerned about evaluating and establishing

best location for the operations. Location decisions generally arise when a
new unit is to be set up, existing plant operations are difficult to expand,
additional facilities are to be established in new territories, emergence of new
social, political or economic conditions or there is changes in the Industrial
Policy of the Government
Locational analysis is a dynamic process where entrepreneur analyses and
compares the appropriateness or otherwise of alternative sites with the aim of
selecting the best site for a given enterprise. It consists of the following:
Demographic Analysis, Trade Area Analysis, Competitive Analysis, Traffic
65 | Page
 OPERATIONS MANAGEMENT

analysis, Site economics,

The important considerations for selecting a suitable location are as follows:

Proximity to market, Proximity to sources of raw materials, Infrastructure,

transport, Banking, waste disposal and community facilities, Labour and
wages, Legislation and taxation, Climatic conditions, Industrial, community
and labour attitudes, Safety requirements, availability of Supporting industries
and services, Availability, suitability and cost of the land

An ideal location is one where the cost of obtaining materials and processing
them into finished product plus the cost of distributing the finished product to
customers is minimum. For this we have to do the economic analysis of the
sites.
Plant layout is defined as arrangement of physical facilities such as machinery,
equipment, furniture etc. with in the factory building in such a manner so as to
have quickest flow of material at the lowest cost and with the least amount of
handling in processing the product from the receipt of material to the shipment
of the finished product. Plant layout is an important decision as it represents
long-term commitment. An ideal plant layout should provide the optimum
relationship among output, floor area and manufacturing process. It facilitates
the production process, minimizes material handling, time and cost, and
allows flexibility of operations, easy production flow, makes economic use of
the building, promotes effective utilization of manpower, and provides for
employee's convenience, safety, comfort at work, maximum exposure to
natural light and ventilation. It is also important because it affects the flow of
material and processes, labour efficiency, supervision and control, use of
space and expansion possibilities etc.

While designing the plant layout, following PRINCIPLES must be kept in mind:
Overall integration of factors, Minimum movement, Uni-directional flow,
Effective use of available space, Maximum visibility, Maximum accessibility,
Minimum handing, Inherent safety, Maximum flexibility
Plant layouts are basically of 4 types: Process or functional layout, Product or
line layout, Fixed or positional layout and mixed layout.
In product layout, machines and equipments are arranged in one line
depending upon the sequence of operations required for the product. The
materials move form one workstation to another sequentially without any
backtracking or deviation. Under this, machines are grouped in one sequence.
Therefore materials are fed into the first machine and finished goods travel
automatically from machine to machine, the output of one machine becoming
input of the next, e.g. in a paper mill, bamboos are fed into the machine at one
end and paper comes out at the other end.
In Process or functional layout machines of a similar type are arranged
together at one place. E.g. Machines performing drilling operations are
66 | Page
 OPERATIONS MANAGEMENT

arranged in the drilling department, machines performing casting operations

be grouped in the casting department. Therefore the machines are installed in
the plants, which follow the process layout. Hence, such layouts typically have
drilling department, milling department, welding department, heating
department and painting department etc. Process layout is adopted when -
Products are not standardized, Quantity produced is small, There are frequent
changes in design and style of product, Job shop type of work is done,
Machines are very expensive In Fixed position or location layout the major
product being produced is fixed at one location. Equipment labour and
components are moved to that location. All facilities are brought and arranged
around one work center. This layout is used for manufacture of bulky products,
Construction industry and Hospital.
Combined or group layout is a combination of the product and process layout
e.g. for industries involving the fabrication of parts and assembly, fabrication
tends to employ the process layout, while the assembly areas often employ the
product layout.
In cellular layout the facilities are clubbed together into cells to utilise the
concepts, principles and approaches of group technology. This layout makes it
possible to adopt high degree of automation even if the product variety is large
and product demands are not stable. In this layout, the facilities are grouped
into cells that are able to perform similar type of operations for a group of
products.
Important tools and techniques helpful in the layout analysis are - Process
Charts, Diagrams, Travel Chart, REL Chart, Templates, Scale Models.

67 | Page