Innovation at McDonalds

NEW KITCHEN LAYOUT _ New Just in Time breakfast

Indoor seating (1950s)

Drive-through window (1970s)
Adding breakfast to the menu (1980s)
Adding play areas (1990s)

Layout Strategy

(Four out of the Five are layout decisions)

What is Facility Layout

Process Lay out

Location or arrangement of everything within &

around buildings

Objectives are to maximize

Customer satisfaction
Utilization of space, equipment, & people
Efficient flow of information, material, & people
Employee morale & safety

Savings of upto 30% of manufacturing (incl.

inventory) costs possible by using proper layout
Functional Lay Out Machines with Similar Functions Grouped Together

Cellular Lay Out

A Product Layout
In

Out
Each cell processes a family of products with similar sequence of operations

Six Layout Strategies

Retail/service layout

Fixed-position layout

large bulky projects such as ships and buildings

Process-oriented layout

deals with low-volume

low volume, high-variety
high variety production ((job
job
shop, intermittent production)

Product-oriented layout

Six Layout Strategies - continued

seeks the best personnel and machine use in

repetitive or continuous production

Fixed--Position Layout
Fixed

allocates shelf space and responds to customer

behavior
Warehouse layout

addresses trade-offs
trade offs between space and material handling

Office layout

positions workers, their equipment, and spaces/offices

to provide for movement of information

Process--Oriented Layout
Process
Design places departments with large flows of material or people
together
Department areas having similar processes located in close proximity
e.g., All x-ray machines in same area
Used with process-focused processes

Design is for stationary project

Workers and equipment come to site
Complicating factors
Limited space at site
Changing material needs- at each stage of project
Dynamic volumes at each stage

Emergency Room Layout

E.R.Triage
room

Patient A broken leg

Patient B - erratic
pacemaker

Hallway

E.R. beds

Pharmacy

Billing/exit

Steps in Developing a
Process-Oriented Layout
Process1 Construct a from-to matrix
2 Determine space requirements for each
department
g
3 Developp an initial schematic diagram
4 Determine the cost of this layout
5 By trial-and-error (or more sophisticated means),
try to improve the initial layout
6 Prepare a detailed plan that evaluates factors in
addition to transportation cost

Cost of ProcessProcess-Oriented Layout

n

Interdepartmental Flow of Parts

Minimize cost = X ijCij

i =1 j=1

where n = total number of work centers

or departments
i, j = individual departments
X ij = number of loads moved from
department i to department j
Cij = cost to move a load between

Room 2

Room 3

Assembly
Department
(1)

Printing
Department
(2)

Machine Shop
Department
(3)

Receiving
Department
(4)

Shipping
Department
(5)

Testing
Department
(6)

Room 4

Room 5
60

Room 6

20

30

50

10

20

100

50

0
0

50

30

40

100
10

100

30

50

100

100

Interdepartmental Flow Graph

Showing Number of Weekly Loads

100

Interdepartmental Flow Graph

Showing Number of Weekly Loads

Room 1

50

50

Possible Layout 1

department i and department j

50

Possible Layout 3
Room 1

Room 2

Room 3

Painting
Department
(2)

Assembly
Department
(1)

Machine Shop
Department
(3)

Receiving
Department
(4)

Shipping
Department
(5)

Testing
Department
(6)

Room 4

Room 5
60

Room 6

40

Computer Programs to Assist in

Layout
CRAFT
SPACECRAFT
CRAFT 3-D
MULTIPLE
CORELAP
ALDEP
COFAD
FADES - expert system

Out--Patient Hospital Example

Out
CRAFT
Legend:
A = xray/MRI rooms
B = laboratories
C = admissions
D = exam rooms
E = operating rooms
F = recovery rooms

1
1 A
2 A
3 D
4 C
5 F
6 E

2
A
A
D
C
F
E

3
A
A
D
D
F
E

4
A
A
D
D
F
E

5
B
B
D
D
F
E

6
B
B
D
D
D
D

1
1 D
2 D
3 D
4 C
5 A
6 A

Total cost: 20,100

Est. Cost Reduction .00
Iteration 0
n

2
D
D
D
C
A
A

3
D
D
D
D
A
A

4
D
D
E
E
A
F

5
B
B
E
E
A
F

6
B
B
E
F
F
F

Total cost: 14,390

Est. Cost Reduction 70.
Iteration 3

Minimize cost = X ijCij

i =1 j=1

Office Layout

Office Layout Floor Plan

Design positions people, equipment, & offices

for maximum information flow
Arranged by process or product

Example:
p Payroll
y dept.
p is byy pprocess

Accounting

Finance

Fin.

Relationship chart used

Examples

Manager

Insurance company
Software company

Brand X

Relationship Chart
1 President

1
O

2 Costing

2
U

A
3 Engineering
4 Presidents Secretary
I = Important
U = Unimportant

A
I

Acct.

Office Relationship Shart

Ordinary closeness:
President (1) &
Costing (2)

Absolutely necessary:
President (1) &
Secretary (4)

1 President
2 Chief Technology Officer
3 Engineers Area
4 Secretaryy
5 Office entrance
7 Equipment cabinet
8 Photocopy equipment
9 Storage room
9 Storage room

O
A
O

U
I

Val. Closeness

A
I

I U
I O O
A E U O
X E E U
U A O
O U I
O X
U A
E
E
A

Absolutely
necessary

Especially
p
y
important

Important

Ordinary OK

Unimportant

Not desirable

Retail Layouts Some Rules of Thumb

Retail/Service Layout

Locate high-draw items around the periphery of the store

Use prominent locations such as the first or last aisle for
high-impulse and high margin items
Remove crossover aisles that allow customers the
opportunity to move between aisles
Distribute what are known in the trade as power items
(items that may dominate a shopping trip) to both sides of
an aisle, and disperse them to increase the viewing of other
items
Use end aisle locations because they have a very high
exposure rate

Design maximizes product exposure to customers

Decision variables

Store flow pattern

Allocation of (shelf) space to products

Types
Video

Grid design
Free-flow design

Retail/Service Layout Free--Flow Design

Free

Retail /Service Layout Grid Design

Grocery Store

Apparel Store

Meat

Milk

Produce Frozen Foods

Bread

Carts

Office

CheckCheckout

FLEXIBLE MANUFACTURING SYSTEM

CNC
Machin
e

Display
Table

FLEXIBLE MANUFACTURING SYSTEM A

COMPONENT

Finished
goods

9 Programmable manipulators
9 Follow specified path
9 Better than humans with respect to
Hostile environments
Long hours
9 Consistency
9

Computer
control
room

9
Terminal

Pallet

Automatic
tool changer

Trans.
Counter

Feature

CNC
Machin
e

Parts

9 Adoption has been slowed by

ineffective integration and adaptation
of systems

LINE BALANCING

Analysis of production lines

Nearly equally divides work between workstations
q
output
p
while meetingg required
Objectives

Maximize efficiency
Minimize number of
work stations

Assembly Line Balancing

Work

Station

Work Station

Work
Station

5
Belt Conveyor

Office
Note: 5 tasks or operations; 3 work stations

LINE BALANCING - CONSTRAINTS

LINE EFFICIENCY

Efficiency
i

1. Precedence requirements

Physical restriction, order of operations

Minimum number
of workstations
i

i=1

i=1

E = nC
a

N= C
d

2. Cycle time restrictions

Max. operating time allowed for each workstation

Depend on demand rate, production time

Cd = Production time available / Desired units of output

ti
j
n
Ca
Cd

Cycle Time Example

Cd = cycle time, N= No. of work stations, Flow time =
time taken to complete all stations

Cd =
Cd =

production time available

desired units of output

(8 hours x 60 minutes / hour)

(120 units)

Cd =

480
120

= 4 minutes

=
=
=
=
=

completion time for element i

number of work elements
actual number of workstations
actual cycle time
desired cycle time

Flow Time vs Cycle Time

Cycle time = max time spent at any station
Flow time = time to complete all stations
1

4 minutes

4 minutes

4 minutes

Flow time = 4 + 4 + 4 = 12 minutes

Cycle time = max (4, 4, 4) = 4 minutes

LINE BALANCING GENERAL PROCESS

LINE BALANCING PROCESS STEPS

1.
2.
3.
4.
5.
6.
7.
8.

Determine cycle time by taking the demand (or

production rate) per day and dividing it into the
productive time available per day
Calculate
C l l t th
the th
theoretical
ti l minimum
i i
number
b off workk
stations by dividing total task time by cycle time
Perform the line balance and assign specific
assembly tasks to each work station

LINE BALANCING EXAMPLE PRECEDENCE DIAGRAM

10 Min.

11

C
4

Determine tasks (operations)

Determine sequence
Draw precedence diagram
Estimate task times
Calculate cycle time
Calculate number of work stations
Assign tasks
Calculate efficiency

Assembly Line Balancing Equations

Cycle time

Minimum
number of
work stations

Production time available

Demand per day
Task times

Cycle time

D
12

Efficiency

11

Task times

(Actual number
* (Cycle time)
of work stations)

Suppose that 40 products are required in one day (8 hour shift)

LINE BALANCING SOLUTION TO PRECEDENCE

DIAGRAM

Line Balancing: Example 2

Demand requirement = 6000 units per week; Time = 40 hours per week
WORK ELEMENT

A
B
C
D

10

11

PRECEDENCE

TIME (MIN)

A
A
B, C

0.1
0.2
0.4
0.3

Press out sheet of fruit

Cut into strips
Outline fun shapes
Roll up and package
0.2

3
D

0.1
12

11

Cd=12 mins,
Eff = 91%

D
C

0.4

0.3

Line Balancing: Example (cont.)

WORK ELEMENT
A
B
C
D

PRECEDENCE

TIME (MIN)

A
A
B, C

0.1
0.2
0.4
0.3

Press out sheet of fruit

Cut into strips
Outline fun shapes
Roll up and package

Line Balancing: Example (cont.)

WORKSTATION

ELEMENT

REMAINING
TIME

REMAINING
ELEMENTS

0.3
0.1
0.0
01
0.1

B, C
C, D
D
none

A
B
C
D

2
3

0.2

0.1
N=

0.1 + 0.2 + 0.3 + 0.4

1.0
=
= 2.5 3 workstations
0.4
0.4

E=

Work
station 2

Work
station
3

A, B

0.3
minute

0.4
minute

0.3
minute

Cd = 0.4
N = 2.5

1.0
0.1 + 0.2 + 0.3 + 0.4
=
= 0.833 = 83.3%
1.2
3(0.4)

Cellular Layout - Work Cells

Special case of product-oriented layout - in what
is ordinarily a process-oriented facility
Consists of different machines brought together to
make
k a product
d t
Temporary arrangement only
Example: Assembly line set up to produce 3000
identical parts in a job shop

D
C

Line Balancing: Example (cont.)

Work
station 1

Cd = 0.4
N = 2.5

40 hours x 60 minutes / hour

2400
Cd =
=
= 0.4 minute
6,000 units
6000

0.3

0.4

Computerized Line
Balancing
Use heuristics to assign tasks to
workstations

Longest operation time

Shortest operation time
Most number of following tasks
Least number of following tasks
Ranked positional weight

Process vs Cellular Layout

Improving Layouts by Moving to

the Work Cell Concept

Lean Manufacturing Principles

Lean means manufacturing without waste"

Waste ("muda" in Japanese) has many forms

Material, time, idle equipment, and inventory

Most companies waste 70%-90% of their available resources
Even the best Lean Manufacturers probably waste 30%

Lean Manufacturing and Cellular Manufacturing improve

material handling, inventory, quality, scheduling, personnel and
customer satisfaction.
i f i

A set of techniques that identify and eliminate waste has

evolved: "Lean Manufacturing."
Cellular Manufacturing
Pull Scheduling (Kanban)
Six Sigma / Total Quality Management
Rapid Setup (SMED)
Team Development

Cellular Manufacturing- The Heart of Lean

Roadmap to Manufacturing Excellence

Cellular Manufacturing and work cells are at the heart

of Lean Manufacturing. Their benefits are many and
varied. They increase productivity and quality. Cells
simplify material flow, management and even accounting
systems.
Cellular Manufacturing seems simple
simple. But beneath this
deceptive simplicity are sophisticated Socio-Technical
Systems. Proper functioning depends on subtle
interactions of people and equipment. Each element must
fit with the others in a smoothly functioning, selfregulating and self-improving operation.

Process vs Cellular Layout

Types of Cells -Part Family (or Group

Technology) Cells
Part Family (or Group Technology) Cells

A family of similar items are made in a self contained

cell
Each product may use only some of the cells facilities
Operators are flexible, work in teams & have greater
autonomy
Complex routes through the cell are permitted, group
layout common but line possible
Cells offer substantial performance improvements

especially lead time & WIP reductions, delivery reliability,

flexibility

Group Technology types are the most important and

numerous, but
FMS/FMCs also fall in this category

Family size decreases GT => FMC => FMS

Thirteen Parts Same Family

Types of Cells Nagare Cells

Operators walk the part round
the process
unit production
Semi-automatic plant used
manual load, auto run &
unload
l d
Distance walked critical
careful handling design
narrow plant
Adjust output by altering the
number & routes of the
operators!
Used in automotive and
electronics industries

Cellular Manufacturing

Functional Lay out

Application of GT principles to shop floor

Cellular manufacturing consists of cells where each cell is
dedicated to produce one part family.
Generally,
G
ll cellular
ll l manufacturing
f t i plants
l t h
have a
miscellaneous facility, in addition to cells dedicated to part
families, that has the capability of processing many diverse
operations. These are helpful in processing parts that
needed to be farmed out of their cell for one or two
operations.

Functional Lay Out Machines with Similar Functions Grouped Together

Cellular Lay Out

Cell Formation Criteria

Parts grouped based on similarity of shape
Parts grouped based on similarity of operations
Machinery grouped based on part family superset of operations on
individual products
Minimal machinery shared between cells
Machinery/equipment shared between most of the products grouped
into remainder cells (Heat Treatment, Protective Treatments, etc.)
Machine layout within a cell in linear flow
Miscellaneous facility to provide varied capabilities not available in each
cell.

Each cell processes a family of products with similar sequence of operations

Converting a Job Shop into Cellular

Manufacturing System

Conversion from process to Cellular layout example

(use of Kings algorithm)
Assembly

Parts
A
B
C
D
E
F
G
H

Machines
1 2 3 4 5 6 7 8 9 10 11 12
x x

x
x

x
x x

x
x

x
x

x x

x
x x
x

KINGs Algorithm is the Key.

4

12

10

x
3

x
x

x
x

x
x x

11

Raw materials

Parts >>>

Assembly

Parts
A
D
F
C
G
B
H
E

Machines
1 2 4 8 10 3 6 9 5 7 11 12

x x x x x
x x x x x
x
x x

10

x x x
x x x

Cell 1

Cell 2

12

Cell 3
7

x
x x x x
x x x
x
x

Weights: 2^4 2^3 2^2 2^1 2^0

P1

P2

P2

P3

P4

P5

M1

M2

M3

M4

A B C
Raw materials

Step 1: Weights on Columns

Parts >>>

P1

Machines
11

You need Process Part matrix. A 1 in a cell indicates

that the part is processed on that machine.

P3

P4

P5

Step 1: Weights on Columns

Weights: 2^4 2^3 2^2 2^1 2^0

Weighted Sum

Machines

Parts >>>

P1

P2

P3

P4

P5

Weighted Sum

Machines

M1

11

M1

11

M2

20

M2

20

M3

10

M3

10

M4

21

M4

21

Apply right to left in increasing power of 2.

Calculate weighted sum for each row

Step 2: Rank Columns

Weights:
Parts >>>

Step 3: Weights on Rows

Parts >>>

2^4 2^3 2^2 2^1 2^0

Weighted Sum

P1

P2

P3

P4

P5

M3

10

M1

11

M2

20

M4

21

Machines

Sort rows in increasing row weights from top

down

P1

P2

P3

P4

P5

M3

2^0

M1

2^1

M2

2^2

M4

2^3

12

12

10

Machines

Weighted
Sum

Weights

Apply top down in increasing power of 2.

Calculate weighted sum for each column.

Step 5: Stopping Criterion and

Cell Formation

Step 4: Rank the rows

z
Parts >>>

P1

P3

P5

P2

P4

Weights

M3

2^0

M1

2^1

M2

2^2

M4

2^3

12

12

10

Machines

Weighted
Sum

Sort columns in increasing column

weights from right to left

Benefits of Cellular lay Out

Stop when no more rows or columns are able

switch.
For this case, cells are:
Cell 1: M2 and M4 to process P1 and P3
Cell 2: M1 and M3 to process P2 and P4
Miscellaneous facility to produce P5.
Or, you can make it in Cell 1 and farm out
to Cell 2. Alternately, design or process
review can be undertaken to eliminate
one of the operations of P5.

How Does a Work Cell Differ from an Assembly

Line?
Assembly lines and work cells have some characteristics in commonboth
organize multiple functions together to serve the needs of a particular product or
service type
Although there is a gray area between the two types of work arrangements, cells
may be distinguished as follows:

Thank you!

Cells offer more flexibility in that they typically can produce a range of
service
i or products
d t within
ithi a ffamily
il

Assembly lines commonly are dedicated to just one product

Cell workers normally perform a broader range of tasks than the more
narrow roles typical of assembly line work

Cells often are described as a hybrid that combines the focus and flow of
an assembly line with the flexibility of a job shop functional arrangement