Chapter 10 – Layout Planning

Operations Management
by
R. Dan Reid & Nada R. Sanders
4th Edition © Wiley 2010

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 Learning Objectives
 Define layout planning and explain its
importance
 Identify and describe different types of
layouts
 Compare process layouts & product
layouts
 Describe the steps involved in designing a
process layout

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 Learning Objectives – con’t
 Describe the steps involved in designing a
product layout
 Explain the advantages of hybrid layouts
 Define the meaning of group technology
(cell) layouts

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 What Is Layout Planning?
Layout planning is deciding the best physical arrangement of
all resources within a facility
 Facility resource arrangement can significantly affect
productivity
 Two broad categories of operations:
 Intermittent processing systems – low volume of many different
products
 Continuous processing systems – high volume of a few
standardized products

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 Types of Layouts
 Four basic layout types consisting of:
 Process layouts - Group similar resources together
 Product layouts - Designed to produce a specific
product efficiently
 Hybrid layouts - Combine aspects of both process
and product layouts
 Fixed-Position layouts - Product is two large to
move; e.g. a building

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Process Layouts
 Process layout unique characteristics include:

 Resources used are general purpose

 Facilities are less capital intensive
 Facilities are more labor intensive
 Resources have greater flexibility
 Processing rates are slower
 Material handling costs are higher

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Process Layouts – con’t

 Scheduling resources & work flow is more

complex
 Space requirements are higher

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 Product Layouts
 Product layout unique characteristics are:
 Resources are specialized
 Facilities are capital intensive
 Processing rates are faster
 Material handling costs are lower
 Space requirements for inventory storage are
lower
 Flexibility is low relative to the market
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 Process vs. Product Layouts
Here are the characteristic differences between a process
and product layout.

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 Hybrid Layouts
 Combine elements of both product &
process layouts
 Maintain some of the efficiencies of product
layouts
 Maintain some of the flexibility of process
layouts
 Examples:
 Group technology & manufacturing cells
 Grocery stores

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 Fixed-Position Layout
 Used when product is large
 Product is difficult or impossible to move,
i.e. very large or fixed
 All resources must be brought to the site
 Scheduling of crews and resources is a
challenge

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Designing Process Layouts
Step 1: Gather information:
Space needed, space available, identify closeness
measures
Step 2: Develop alternative block plans:
Using trial-and-error or decision support tools
Step 3: Develop a detailed layout:
Consider exact sizes/shapes of departments and
work centers including aisles and stairways
Tools like drawings, 3-D models, and CAD software
are available to facilitate this process

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 Special Cases of Process
Layouts
A number of unique process layouts require
special attention. We will look at two of
these:
 Warehouse layouts

 Office Layouts

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 Warehouse Layouts
Warehouse Layout Considerations:
 Primary decision is where to locate each
department relative to the dock
 Departments can be organized to minimize “ld”
totals
 Departments of unequal size require modification
of the typical ld calculations to include a
calculation of the “ratio of trips to area
needed”
 The usage of “Crossdocking” modifies the
traditional warehouse layouts; more docks, less
storage space, and less order picking

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 Office Layouts
Office Layout Considerations:
 Almost half of US workforce works in an office
environment
 Human interaction and communication are the primary
factors in designing office layouts
 Layouts need to account for physical environment and
psychological needs of the organization
 One key layout trade-off is between proximity and
privacy
 Open concept offices promote understanding & trust
 Flexible layouts incorporating “office landscaping” help
to solve the privacy issue in open office environments
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 Designing Product Layouts
 Designing product layouts requires
consideration of:
 Sequence of tasks to be performed by each
workstation
 Logical order
 Speed considerations – line balancing

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 Designing Product Layouts –
con’t
Step 1: Identify tasks & immediate predecessors
Step 2: Determine output rate
Step 3: Determine cycle time
Step 4: Compute the Theoretical Minimum number of
Stations
Step 5: Assign tasks to workstations (balance the
line)
Step 6: Compute efficiency, idle time & balance delay

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Step 1: Identify Tasks &
Immediate Predecessors
Example 10.4 Vicki's Pizzeria and the Precedence Diagram
Immediate Task Time
Work Element Task Description Predecessor (seconds
A Roll dough None 50
B Place on cardboard backing A 5
C Sprinkle cheese B 25
D Spread Sauce C 15
E Add pepperoni D 12
F Add sausage D 10
G Add mushrooms D 15
H Shrinkwrap pizza E,F,G 18
I Pack in box H 15
Total task time 165

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 Layout Calculations
 Step 2: Determine output rate
 Vicki needs to produce 60 pizzas per hour
 Step 3: Determine cycle time
 The amount of time each workstation is allowed to

complete its tasks

available time sec./day  60 min/hr x 60 sec/min
Cycle time (sec./unit )    60 sec./unit
desired output units/hr  60 units/hr

 Limited by the bottleneck task (the longest task in a

process):
available time 3600 sec./hr.
Maximum output    72 units/hr, or pizzas per hour
bottleneck task time 50 sec./unit
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Layout Calculations con’t
 Step 4: Compute the theoretical minimum
number of stations
 TM = number of stations needed to
achieve 100% efficiency (every second is
used)

TM 
 task times   165 seconds
 2.75, or 3 stations
cycle time 60 sec/station

 Always round up (no partial workstations)

 Serves as a lower bound for our analysis
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 Layout Calculations con’t
 Step 5: Assign tasks to workstations
 Start at the first station & choose the longest eligible task following
precedence relationships
 Continue adding the longest eligible task that fits without going over the
desired cycle time
 When no additional tasks can be added within the desired cycle time, begin
assigning tasks to the next workstation until finished
Workstation Eligible task Task Selected Task time Idle time
A A 50 10
1
B B 5 5
C C 25 35
2 D D 15 20
E, F, G G 15 5
E, F E 12 48
F F 10 38
3
H H 18 20
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 Last Layout Calculation
 Step 6: Compute efficiency and balance delay
 Efficiency (%) is the ratio of total productive

time divided by total time

Efficiency (%) 
 t

165 sec.
100  91.7%
NC 3 stations x 60 sec.

 Balance delay (%) is the amount by which the

line falls short of 100%

Balance delay  100%  91.7%  8.3%

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 Other Product Layout Considerations
 Shape of the line (S, U, O, L):
 Share resources, enhance communication & visibility,
impact location of loading & unloading

 Paced versus Un-paced lines

 Paced lines use an automatically enforced cycle time

 Number of Product Models produced

 Single
 Mixed-model lines

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Group Technology (CELL)
Layouts
 One of the most popular hybrid layouts uses Group
Technology (GT) and a cellular layout
 GT has the advantage of bringing the efficiencies of a
product layout to a process layout environment

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Process Flows before the Use of GT Cells

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Process Flows after the Use of GT Cells

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 Facility Layout Across the
Organization
Layout planning is organizationally important
for an efficient operations
 Marketing is affected by layout especially
when clients come to the site
 Human resources is affected as layout impacts
people
 Finance is involved as layout changes can be
costly endeavors

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 Facility Layout within OM:
How it all fits together
 Layout decisions are directly related to issues of product
design and process selection (Ch 3).
 Job design, as process layouts tend to require greater
worker skills than do product layouts (Ch 11).
 Degree of automation, as product layouts tend to be
more capital intensive and use more automation
compared to process layouts (Ch 3).
 Layout decisions are also affected by implementation of
just-in-time (JIT) systems, which dictate a line flow and
the use of group technology (GT) cells (Ch 7).
 As layout decisions specify the flow of goods through the
facility, they impact all other aspects of operations
management.
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 Chapter 10 Highlights
 Layout planning is deciding on the best physical
arrangement of all resources that consumes space within a
facility. Proper layout planning is highly important for the
efficient running of a business. Otherwise, there can be
much wasted time and energy, as well as confusion.

 There are four basic types of layouts: process, product,

hybrid, and fixed position. Process layouts group
resources based on similar processes. Product layouts
arrange resources in straight-line fashion. Hybrid layouts
combine elements of both process and product layouts.
Fixed-position layouts occur when the product is larger
and cannot be moved.

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 Chapter 10 Highlights – con’t
 Process layouts provide much flexibility and allow for the
production of many products with differing characteristics.
Product layouts, on the other hand, provide greater
efficiency when producing one type of product.

 The steps for designing process layouts are (1) gather

information about space needs, space availability, and
closeness requirements of departments; (2) developing a
block plan or schematic of the layout; and (3) developing a
detailed layout.

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 Chapter 10 Highlights – con’t
 The steps for designing an product layout are (1) identify
tasks that need to be performed and their immediate
predecessors; (2) determine output rate; (3) determine
cycle time; (4) computing the theoretical minimum number
of work stations, (5) assigning tasks to workstations; and
(6) computing efficiency and balance delay.
 Hybrids layouts have advantages over other layout types
because they combine elements of both process and
product layouts to increase efficiency.

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 Chapter 10 Highlights – con’t
 An example of hybrid layouts is group technology or cell
layouts. Group technology is the process of crating
groupings of products based on similar processing
requirements. Cells are created for each grouping of
products, resulting in a more orderly flow of products
through the facility.

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 The End
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