Management has asked you to justify the current facility layout in the organization. This is an exciting opportunity because you recall multiple conversations with your peers about how so much time is wasted on day-to-day processes. However, you're not entirely sure if a change in facility layout is appropriate. Utilize the concepts discussed in the textbook or an outside source to justify your answers.
(1) What is the framework for evaluating alternative site locations? What are the qualitative and quantitative factors involved in site selection?
(2) What are the various facility layouts used today in manufacturing and service operations? What are some of the characteristics of a good layout?
(3) Define the type of layout used in your organization. Do you think a different layout will be more efficient in your organization? Explain your answer.
Develop Location Alternatives: Identify a limited number of potential geographic locations that meet the basic requirements.
Evaluate and Select: Use a combination of analytical tools (like the Factor Rating Method or Center of Gravity Method) to compare alternatives based on the critical factors and select the best one.
Qualitative and Quantitative Factors in Site Selection
| Factor Type | Description | Examples Relevant to Operations |
| Quantitative Factors | Easily measurable costs or financial metrics that can be directly compared across sites. | Labor Costs (wages, unionization), Taxes (local, state), Transportation Costs (inbound raw materials, outbound finished goods), Utility Costs (electricity, water), and Land/Building Costs (purchase or lease). |
| Qualitative Factors | Non-measurable factors related to the surrounding environment, infrastructure, and community, often assessed using a scoring system. | Quality of Life (for recruiting), Infrastructure (road quality, broadband speed), Government/Community Attitude (local incentives, regulations), Supplier Proximity, Competitor Location, and Labor Availability (skills and education level). |
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2. Facility Layouts and Characteristics of a Good Layout
Facility layout refers to the arrangement of departments, work centers, equipment, and storage areas within an existing or planned facility.
Various Facility Layouts
The four primary types of facility layouts are:
Product Layout (Assembly Line):
Structure: Equipment is arranged sequentially according to the steps required to manufacture a product (e.g., assembly lines, cafeterias).
Best Used For: High-volume, standardized operations (e.g., automobile manufacturing, fast food).
Process Layout (Functional Layout):
Structure: Equipment and people performing similar functions are grouped together (e.g., all lathes in one department, all X-ray machines in one room).
Best Used For: Low-volume, high-variety, custom operations (e.g., job shops, hospitals, custom bakeries).
Fixed-Position Layout:
Structure: The product or project remains stationary, and workers, materials, and equipment are brought to the work area.
Best Used For: Large, bulky, or fragile items (e.g., shipbuilding, aircraft assembly, large construction sites).
Cellular Layout (Hybrid):
Structure: Workstations are grouped into "cells" where each cell processes a family of parts or customers requiring similar steps. This attempts to combine the efficiency of product layout with the flexibility of process layout.
Best Used For: Manufacturing parts that share processing
Sample Answer
Justifying your facility's current layout or proposing a change requires understanding the criteria for both site selection and layout design. Since you're hearing complaints about wasted time, a layout re-evaluation is likely warranted, even if the site is fixed.
1. Framework for Evaluating Alternative Site Locations
The decision to select a site (or location) is strategic and long-term. Although your current facility is fixed, understanding this framework helps articulate why the current location supports or hinders overall operational efficiency.
The general framework for evaluating alternative site locations involves three main steps:
Identify Critical Factors: Determine the key factors (both quantitative and qualitative) crucial for the operation's success.