Capacity planning establishes a firm's level of productive resources and strategies for timing capacity expansion relative to demand growth. Key considerations for capacity increases include anticipated demand volume/certainty, costs, and strategic objectives. Process layouts group similar activities together, product layouts arrange activities by production sequence, and hybrid layouts combine approaches. Line balancing aims to equalize workloads across stations within a cycle time. Cellular layouts group dissimilar machines into work centers for part families, while flexible manufacturing systems automate production of diverse items.

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Capacity and Facilities
Chapter 7

7. • Capacity Planning
• Basic Layouts
• Designing Process Layouts
• Designing Service Layouts
• Designing Product Layouts
• Hybrid Layouts
Lecture Outline

8. • Maximum capability to produce
• Capacity planning
• establishes overall level of productive
resources for a firm
• 3 basic strategies for timing of capacity
expansion in relation to steady growth in
demand (lead, lag, and average)
Capacity

9. • Capacity increase depends on
• volume and certainty of anticipated demand
• strategic objectives
• costs of expansion and operation
• Best operating level
• % of capacity utilization that minimizes unit costs
• Capacity cushion
• % of capacity held in reserve for unexpected
occurrences
Capacity (cont.)

10. • it costs less per unit to produce high levels of
output
• fixed costs can be spread over a larger number of
units
• production or operating costs do not increase
linearly with output levels
• quantity discounts are available for material
purchases
• operating efficiency increases as workers gain
experience
Economies of Scale

11. Best Operating Level for a Hotel
Best Operating Level f

12. • Process layouts
• group similar activities together
according to process or function they
perform
• Product layouts
• arrange activities in line according to
sequence of operations for a particular
product or service
• Fixed-position layouts
• are used for projects in which product
cannot be moved
BASIC LAYOUTS

13. Process Layout in Services
Women’s
lingerie
Shoes Housewares
Women’s
dresses
Cosmetics
and jewelry
Children’s
department
Women’s
sportswear
Entry and
display area
Men’s
department
Process Layout in Se

14. Manufacturing Process Layout
Manufacturing Proce

15. In
Out
A Product Layout

16. Fixed-Position Layouts
• Typical of projects in
which product produced
is too fragile, bulky, or
heavy to move
• Equipment, workers,
materials, other
resources brought to the
site
Low equipment utilization
Highly skilled labor
Typically low fixed cost
Often high variable costs
•
•
•
•
7-335
Fixed-Position Layo

17. Designing Process Layouts
• Goal: minimize material handling costs
• Block Diagramming
• minimize nonadjacent loads
• use when quantitative data is
• Relationship Diagramming
• based on location preference
• use when quantitative data is
available
between areas
not available
Designing Process L

18. • Must be both attractive and functional
Types
• Free flow layouts
• encourage browsing, increase impulse purchasing, are flexible
•
and visually appealing
• Grid layouts
• encourage customer familiarity, are low cost, easy to clean and
secure, and good for repeat customers
• Loop and Spine layouts
• both increase customer sightlines and exposure to products,
while encouraging customer to circulate through the entire
store
Designing Service
Layouts

19. Types of Store Layouts

20. • Objective
• Balance the assembly line
Line balancing
• tries to equalize the amount of work at each
•
workstation
Precedence requirements
• physical restrictions on the order in which operations
are performed
Cycle time
• maximum amount of time a product is allowed to
spend at each workstation
•
•
Designing Product
Layouts

21. Cd = desired units of output
Cd = (120 units)
= = 4 minutes
Cd 120
production time available
(8 hours x 60 minutes / hour)
480
Cycle Time Example

22. Time
• Cycle time = max time spent at any station
• Flow time = time to complete all stations
4 minutes 4 minutes 4 minutes
Flow time = 4 + 4 + 4 = 12 minutes
Cycle time = max (4, 4, 4) = 4 minutes
3
2
1
Flow Time vs Cycle

23. Efficiency of Line and Balance Delay
Efficiency workstations
• Balance
∑ ∑
ti ti
nCa Cd
time of line
ti = completion time for element i
Efficiency of Line and Balance Dela
Minimum number of
i i
∑ ti ∑ ti
delay
• total idle
time of lin
• calculated
as (1 -
efficiency)
E = i = 1
N = i = 1
where
j = number of work elements
n = actual number of workstations
Ca = actual cycle time
Cd = desired cycle time

24. dure
1.
2.
3.
Draw and label a precedence diagram
Calculate desired cycle time required for line
Calculate theoretical minimum number of
workstations
4. Group elements into workstations, recognizing
time and precedence constraints
Calculate efficiency of line
Determine if theoretical minimum number of
cycle
5.
6.
workstations or an acceptable efficiency level has
been reached. If not, go back to step 4.
Line Balancing Proce

25. B
0.4
Line Balancing: Example
WORK ELEMENT PRECEDENCE TIME (MIN)
A Press out sheet of fruit — 0.1
B Cut into strips A 0.2
C Outline fun shapes A 0.4
D Roll up and package B, C 0.3
0.2
0.1 A D 0.3
C

26. Cd = = = 0.4 minute
Line Balancing: Example (cont.)
WORK ELEMENT PRECEDENCE TIME (MIN)
A Press out sheet of fruit — 0.1
B Cut into strips A 0.2
C Outline fun shapes A 0.4
D Roll up and package B, C 0.3
40 hours x 60 minutes / hour 2400
6,000 units 6000
N =
0.1 + 0.2 + 0.3 + 0.4
=
1.0
= 2.5 � 3 workstations
0.4 0.4

27. N = 2.5
0.4
Line Balancing: Example (cont.)
REMAINING REMAINING
WORKSTATION ELEMENT TIME ELEMENTS
1 A 0.3 B, C
B 0.1 C, D
2 C 0.0 D
3 D 0.1 none
B
0.2
0.1 A D 0.3
C
Cd = 0.4

28. Line Balancing: Example (cont.)
Cd = 0.4
N = 2.5
1.2
3(0.4)
E =
0.1 + 0.2 + 0.3 + 0.4
=
1.0
= 0.833 = 83.3%
Work Work Work
station 1 station 2 station 3
A, B C D
0.3 0.4 0.3
minute minute minute
Line Balancing: Examp

29. • Cellular layouts
• group dissimilar machines into work centers (called cells)
that process families of parts with similar shapes or
processing requirements
• Production flow analysis (PFA)
• reorders part routing matrices to identify families of parts
with similar processing requirements
Flexible manufacturing system
• automated machining and material handling systems
which can produce an enormous variety of items
Mixed-model assembly line
• processes more than one product model in one line
•
•
Hybrid Layouts

30. Original Process Layout
Assembly
4 6 7 9
5 8
2
1 3
10 12
11
A B C Raw materials
Original Process Layou

31. Revised Cellular Layout
11
Assembly
8 10 9 12
4 Cell 1 Cell 2 6 Cell 3
7
2 1 3 5
A B C
Raw materials
Revised Cellular Layou

32. F x x x
Reordered Routing Matrix
Parts
Machines
1 2 4 8 10 3 6 9 5 7 11 12
A
D
x x x x x
x x x x x
C
G
B
x x x
x x x x
x x x x
x x x
x x x
H
E

33. Advantages and Disadvantages
• Advantages
• Reduced material
handling and transit
• Reduced setup time
• Disadvantages
Inadequate part families
Poorly balanced cells
•
time •
Expanded training and
scheduling of workers
Increased capital
investment
•
• Reduced work-in-
process inventory
• Better use of human
resources
• Easier to control
• Easier to automate
•
Advantages and Disadv
of Cellular Layouts

34. • FMS consists of numerous programmable
machine tools connected by an automated
material handling system and controlled
a common computer network
by
•
•
FMS combines flexibility with efficiency
FMS layouts differ based on
• variety of parts that the system can process
• size of parts processed
• average processing time required for part
completion
Flexible Manufacturing
Systems (FMS)

35. • Produce multiple models in any order
on one assembly line
• Issues in mixed model lines
• Line balancing
• U-shaped lines
• Flexible workforce
• Model sequencing
Mixed Model
Assembly Lines

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Facility Location Models
Chapter 7 Supplement

37. • Types of Facilities
• Site Selection: Where to Locate
•Location Analysis Techniques
Supplement 7-374
Lecture Outline