2.

4 FACILITY LOCATION

Plant location may be understood as the function of determining where the plant should be located for maximum
operating economy and effectiveness

Steps in Location Selection

To be systematic, in choosing a plant location, the entrepreneur would do well to proceed step by step, the steps
be :
1. Within the country or outside;
2. Selection of the region;
3. Selectior of the locality or community;
4. Selection of the exact site.
1. Deciding on Domestic or International Location
The first step in plant location is to decide whether the facility should be located domestically or internationally.
A few years ago, this factor would have received little consideration.

2. Selection of Region
(i) Availability of Raw Materials
(ii) Nearness to the Market
(iii) Availability of Power
(iv) Transport Facilities
(v) Suitability of Climate
(vi) Government Policy
3. Selection of Community
Selecting a particular locality or community in a region is the third step in plant location. The selection of a locality
(i) Availability of Labour
Despite the talk of mechanisation and automation, the importance of labour in the industrial side has not been
completely lost.

(ii) Civic Amenities for Workers

Besides good working conditions inside the factory, the employees require certain facilities outside it. Recreation
facilities, such as clubs, theatres and parks, must be provided for the employees.

Existence of Complementary and Competing Industries

The existence of complementary industries is favourable to the location of industries because an industrial unit, in
association with other units, can get the following benefits:
• An industrial unit, in collaboration with other similar units, can secure materials on better terms than it can do
it by itself.

(iv) Availability of Water and Fire-fighting Facilities

4. Selection of the Site

The selection of an exact site in a chosen locality is the fourth step in plant location. The selection of the site is
influenced by the following considerations:
Soil, Size and Topography
Plant Layout, also known as layout of facility refers to the configuration of departments, work-centres and
equipment and machinery with focus on the flow of materials or work through the production system.

Plant layout or facility layout means planning for location of all machines, equipments, utilities, work stations,
customer service areas, material storage areas, tool servicing areas, tool cribs, aisles, rest rooms, lunch rooms,
coffee/tea bays, offices, and computer rooms and also planning for the patterns of flow of materials and people
around, into and within the buildings. Layout planning involves decisions about the physical arrangement of
economic activity centres within a facility.

The questions to be addressed in layout planning are:

• H oW much space and capacity does each centre need?
• How should each center’s space be configured?
• Where should each centre be located?
The location of a centre has two dimensions:
• Absolute location or the particular space that the centre occupies within the facility.
• Relative location i.e., the placement of a centre relative to other centers.

The importance of layout decisions:

Most common reasons for design of new layouts are:

(i) Layout is one of the key decisions that determine the long-run efficiency in operations.
(ii) Layout has many strategic implications because it establishes an organisation’s competitive priorities in regard
to capacity, processes, flexibility and cost as well as quality of work life, customer contact and image (in case
of service organisations).

(iii) An effective layout can help an organisation to achieve a strategic advantage that supports differentiation,
low cost, fast response or flexibility.
(iv) A well designed layout provides an economic layout that will meet the firm’s competitive requirements.

Need for redesign of layout arises because of the following reasons:

• Accidents, health hazards and low safety,
• Changes in environmental or legal requirements,
• Changes in processes, methods or equipments,
• Changes in product design/service design,
• Changes in volume of output or product-mix changes,
• Inefficient operations (high cost, bottleneck operations),
• Introduction of new products/services,
• Low employee morale.
 Good Plant layout- Objectives:
• Efficient utilisation of labour reduced idle time of labour and equipments,
• Higher flexibility (to change the layout easily),
• Higher utilisation of space, equipment and people (employees),
• Improved employee morale and safe working conditions,
• Improved flow of materials, information and people (employees),
• Improved production capacity,
• Reduced congestion or reduced bottleneck centers,
• Reduced health hazards and accidents,
• To allow ease of maintenance,

Choices of Layout:
Layout choices can help greatly in communicating an organisation’s product plans and competitive priorities.
Layout has many practical and strategic implications. Altering a layout can affect an organisation and how well
it meets its competitive priorities by:
• Facilitating the flow of materials and information,
• Improving communication,
• Improving employee morale,
• Increasing customer convenience and sales (in service organisations such as retail stores),

Factors influencing layout choices:

Location:
• Machineryand Equipments:

• Managerial Policies:

• Materials:
• Product

• Type of Industry

Type of Industry Process

I is intermittent type of industry
C is continuous type of industry

• Workers : Plant Layout- Principles:

• Principle of Minimum Travel:

• Principle of Sequence:

• Principle of Usage:

• Principle of Compactness:
• Principle of Safety and Satisfaction:
• Principle of Flexibility:
• Principle of Minimum Investment:

Types of Layout:
Process Layout:
Also called the functional layout, layout for job lot manufacture or batch production layout, the process layout
involves a grouping together of similar machines in one department. For example, machines performing drilling
operations are installed in the drilling department; machines performing turning operations are grouped in the
turning department; and so on. In this way, there would be an electroplating department, a painting department,
a machining departments and the like, where similar machines or equipments are installed in the plants which
follow the process layout. The process arrangement is signified by the grouping together of like machines based
upon their operational characteristics. For example, centre lathes will be arranged in one department, turret
lathes in a second department, and milling machines in a third departments.
While grouping machines according to the process type, certain principles must be kept in mind. These are:
• Convenience for inspection.
• Convenience for supervision. Process layout may be advantageously used in light and heavy engineering
industries, made-to-order furniture industries and the like.

Product Layout:
Also called the straight-line layout or layout for serialised manufacture. The product layout involves the arrangement
of machines in one line depending upon the sequence of operations. Material is fed into the first machine and
finished products come out of the last machine. In between, partly finished goods move from machine to machine.
The output of one machine becoming the input for the next. In a sugar mill, sugar cane, fed at one end of the mill
comes out as sugar at the other end. Similarly, in paper mill, bamboos are fed into the machine at one end and
paper comes out at the other end.
In product layout, if there are more than one, line of production, there are as many, lines of machines. The emphasis
here, therefore, is on special purpose machines in contrast to general purpose machines, which are installed in the
process layout. Consequently, the investment on machines in a straight line layout is higher than the investment
on machines in a functional layout.

Lathe Drilling Grinding

Raw material in (Finished)
Comonent 1 Comonent 1

Cutting Lathe Drilling Plating

Comonent 2 Comonent 2
Product out

Cutting Lathe Gear cutting Grinding

Comonent 3 Comonent 3

Figure of Product Layout

The grouping of machines should be done, on product line, keeping in mind the following principles:
• All the machine tools or other types of equipment must be placed at the point demanded by the sequence
of operations.
• All the operations, including assembly, testing and packing should be, included in the line.
Layout in the form of Fixed Position:
As the term itself implies, the fixed position layout involves the movement of men and machines to the product
which remains stationary. In this type of layout, the material or major component remains in a fixed location, and
tools, machinery and men as well as other pieces of material are brought to this location. The movement of men
and machines to the product is advisable because the cost of moving them would be less than the cost of moving
the product which is very bulky.

Also called static layout, this type is followed in the manufacture, if bulky and heavy products, such as locomotives,
ships, boilers, air crafts and generators.

Machine
Product (Ship) Ship
Men
Assembly
Tools
Tools To be moved towards
Material
the material

Mixed Layout or Combined Layout

The application of the principles of product layout or process layout in their strict meanings is difficult to come
across. A combination of the product and process layouts, with an emphasis on either, is noticed in most industrial
establishments. Plants are never laid out in either pure form. Itis possible to have both types of layout in an efficiently
combined form if the products manufactured are somewhat similar and not complex.

Component flow in combined layout

Layout of Service Facility:

The fundamental difference between service facility and manufacturing facility layouts is that many service
facilities exist to bring together customers and services. Service facility layouts should provide for easy entrance
to these facilities from freeways and busy thoroughfares. Large, well organized and amply lighted parking areas
and well designed walkways to and from parking areas are some of the requirements of service facility layouts.
Importance of layout:

• Avoidance of Bottlenecks:
• Avoidance of Unnecessary and Costly Changes:
• Better Production Control:
• Better Supervision:
• Economies in Handling:
• Effective Use of Available Area:
• Improved Employee Morale:
• Improved Quality Control:
• Improved Utilisation of Labour:
• Minimisation of Production Delays:
• Minimum Equipment Investment:

• Question 11.
The present layout is shown in the figure. The manager of the department is intending to interchange the
departments C and F in the present layout. The handling frequencies between the departments is given. All the
departments are of the same size and configuration. The material handling cost per unit length travel between
departments is same. What will be the effect of interchange of departments C and F in the layout?

A C E
B D F

From / To A B C D E F
A – 0 90 160 50 0
B – – 70 0 100 130
C – – 20 0 0
D – – – _ 180 10
E – – – – 40
F – – – – – –
Total cost matrix for the modified layout.
From / To A B C D E F Total
A – 0 270 320 100 0 690
B 140 0 300 260 700
C 20 0 0 20
D 360 10 370
E 40 40
F –
Total 1,820
Question 12.
A defence contractor is evaluating its machine shops current process layout. The figure below shows the
current layout and the table shows the trip matrix for the facility. Health and safety regulations require
departments E and F to remain at their current positions.

E B F
A C D
Current Layout
From / To A B C D E F
A 8 3 9 5
B - 3
C - 8 9
D - 3
E - 3
F -
Can layout be improved? Also evaluate using load distance (ld) score.