EVALUATING AND SELECTING

THE FACILITIES PLAN

Reported by : Mendoza & Tipactipac
 INTRODUCTION
PART 1 – Defining facilities requirements
PART 1,3,4 – Developing alternative facilities plan
PART 5 – Evaluation, Selection, Preparation, Presentation,
Implementation and maintenance of the facilities plan

The process of developing facilities plans contains elements of both art & science.

ARTIST‘s dependence on creativity, synthesis and style combined w/ the

SCIENTIST‘s use of analysis, reduction & deduction is the essence
of facilities planning

ANALYSIS – Is a dissection process

SYNTHESIS – Is a combining or creating a process
 INTRODUCTION

APPLICATION OF QUANTITATIVE MODELS

-- Including computer-aided layout models, THE FACILITIES

PLANNER explores many different solution spaces for the
facilities plan.

APPLICATION OF SYNTHESIS

-- THE FACILITIES PLANNER combines the quantitative

and qualitative aspects of the plan into a set of alternative
facilities plans to be evaluated.
 INTRODUCTION
THE FACILITIES PLANNER -- Is engaged in a design process (from chp 2 )

THE SIX ( 6) STEP PROCESS

1. Define the problem

2. Analyze the problem
3. Generate alternative solution
4. Evaluate the alternatives
5. Select the preferred solution
6. Implement the preferred solution

These are the simplistic representation of the facilities planning process for
any simple problems.
 INTRODUCTION
This chapter is concerned with the 4 th and 5th steps of the six-step design process:

 the evaluation of alternatives

 the selection of a facilities plan

Eg :
• The initial evaluation and selection of solutions to a problem involving
the transport of parts to an assembly line may include a:

Lift Truck alternative Trolley, Roller, Belt Conveyor alternative AGVS alternative

• To include in the initial evaluation and selection, several specific models

and brands would probably be a poor use of time.

• Once the initial screening is made, specific brands and vendors may be
evaluated to determine the most suitable solution.
 EVALUATING THE
FACILITIES PLAN
This process includes the assessment of each alternatives in terms of the criteria.

EVALUATING is not the same as SELECTING

eg: if one least-cost alternative is to be selected, then;
the costs for each alternative must be evaluated.

If the criteria are easily quantified, the process of evaluation is easier to perform.
 EVALUATING THE
FACILITIES PLAN
LIST OF THE TECHNIQUES USED IN
EVALUATING ALTERNATIVE FACILITIES PLAN

1. List the positive and negative aspects of each alternative.

2. Rank the performance of each alternatives against each enumerated criteria
3. Perform weighted factor comparison of the alternatives

- assign a numerical weight to each factor

- ranking numerically each alternative against each factor
- sum the weighted rankings over all criteria to obtain
a total weighted factor for each alternative

4. Determine the economic performance of each alternative over a specified

planning horizon.
 EVALUATING THE
FACILITIES PLAN

In performing financial justifications of facilities plans, the following systematic

economic analysis technique (SEAT) can be used to justify investments that
deserve to be justified:

1. Specify the feasible alternatives to be compared

2. Define the planning horizon to be used.
3. Estimate the cash flows for each alternatives
4. Specify the discount rate to be used
5. Compare the alternatives using adiscounted cash flow (DCF) method
6. Perform supplementary analyses
7. Select the preferred alternative.
 SELECTING THE
FACILITIES PLAN

• The facilities planner has a responsibility to do a thorough, accurate, and

objective job of developing several good facilities plans.

• The facilities planner also has a responsibility to perform a thorough, accurate,

and objective evaluation of the alternative plans.

• The facilities planner is responsible for presenting professionally the results of

the facilities planning effort to management and making a recommendation
concerning the preferred plan.

• It is the management’s responsibility to either approve or disapprove the

recommendation or to make the selection decision.
 SELECTING THE
FACILITIES PLAN
• The selection process is critically dependent on the facilities planner selling the
facilities plan. Not only must management be sold, but also the end-user of the
system must be sold.

• The sales job for management must address the long term benefits of the
facilities plan. The flexibility, reliability and adaptability of the system must be
addressed.

• The management may take the strategic, offensive position and may want to
know what is going to be the return on investment, increased services, or other
benefits of pursuing the recommended system.

• Systems must be explained and sold to both managers and users and the
approach taken to these 2 groups should be different.