Throughput or lead time are directly affected by the where and how the processing and storage resources are located in the factory

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  • Throughput or lead time are directly affected by the where and how the processing and storage resources are located in the factory.

  • Plant layout is an activity that all companies are forced to deal with sooner or later.

    • It is important to be familiar with the methodologies used to carry out these tasks.
  • Cellular layouts - where labor and machines are grouped in cells - will be explained in depth in the following chapter.


  • Factory layout improvements typically occur more than one time during the factory’s life.

    • The study of plant layouts seeks the optimal location for all of the production resources.
      • Tries to ensure that the economic impact of the project on the enterprise will be as positive as possible.
      • New plant layout must be as safe as possible and satisfactory for the employees.
  • It seems obvious that the optimal solution will be unreachable or change routinely.

    • Commitment between all the aspects is achieved.

Signs and reasons for a new layout

  • Location change.

    • Reasons to suggest a change of location of the factory.
      • Location has become inadequate or antiquated.
      • Factory expansion is impossible.
    • Layout can be different if the company chooses a new location by constructing a new building, versus utilizing an existing facility.
      • New building construction can allow for an ideal layout because building functionality is the principle focus of the building design.
        • Use of the factory floor space should be better utilized.

Signs and reasons for a new layout

  • Purchase new equipment

    • New needs as well as technology improvements form the basis of machinery purchase
      • Finding the best location for the purchased equipment can become a critical issue in making a “system” perform as intended.
    • Newly purchased incremental equipment is generally placed in free space available.
      • In some cases it is necessary to move machines to create space.
      • In other cases the new machine is located in a place that promotes system efficiency.

Signs and reasons for a new layout

  • Problems with materials flow

    • This problem is generally derived from a problem previously solved.
      • Placing new equipment in available space in the plant
        • The initial set-up costs decrease, but other problems arise.
        • Materials flow can be adversely affected by introducing additional equipment.
  • Equipment set up is typically done once, while the materials flow is a continuing process.

    • The analysis of this material flow can in most cases be economically formulated.

Signs and reasons for a new layout

  • High work-in-process (WIP).

    • A good policy or layout in a given period of time may not always produce good results forever.
    • A measure of change in the company is the amount of partially completed products (work-in-process).
      • This should not be confused with a temporary situation caused by a momentary increase in demand or stock outages and/or surges.
    • Slow changes in product variability can hide the negative effects of the excessive work-in-process (WIP).

One-piece flow

  • Before we begin exploring layout analysis tools, it is important to clarify the definition of production and transfer batch even though both sizes are normally the same.

    • Production batch.
      • Number of products included in the customer order.
    • Transfer batch (unit load).
      • Amount of units that flows from one machine to the next.

One-piece flow

  • Work-in-process decreases with a reduction in the transfer batch size.

One-piece flow

  • Advantages of reducing the transfer batch

    • Production feedback is faster.
    • Lead time decreases.
  • A reduction in the transfer batch increases the material handling between sections.

  • The ideal transfer lot size is called continuous one-piece flow.

    • Normally, a container size is considered unit load flow.
      • For example, a “1000-screws flow”, can be used as “unit load flow”.

One-piece flow

  • One-piece-flow eliminates most of the causes and effects outlined in the previous section.

    • It is one of the Just-in-time tools.
  • To come closer to an ideal one-piece-flow, the material flow has to be minimized or eliminated.

    • If this is not possible, then the machines should be located as close together as possible.
  • In order to improve the material flow, it is typically necessary to analyze and change the company’s layout.

Main types of industrial companies

  • In an open-market, there exists a multitude of different products.

    • food, cars, computers, bricks, cement, ships,...
      • Each product has a specific manufacturing process.
  • Analysis is conducted based on similarities

    • Cars and washing machines? yogurt and soap?
  • The grouping is based on the type of production facilities that the companies uses.

    • Industrial companies can be grouped into four sectors.
      • Primary, Secondary, Tertiary and Service Sector.
        • Secondary Sector (Process Industry and Consumption Industry).
        • Tertiary Sector (Production and Assembly factories).

Process industry

  • Process focused industries

    • The manufacture of the product dictates the equipment and product flow.
      • Paper, wood, cement, painting and fabrics manufacturers,...
  • Consumer goods will also be grouped into this type

    • Quality or purity measures will be much higher.
      • Yogurts, ice creams, drinks,…
      • Pharmaceutical and cleaning products.

Process industry

  • Four main steps

    • Raw materials preparation
      • Received in bulk and storage in large warehouses or silos.
      • Product mixing is carried out in hoppers or in smaller drums.
    • Treatment
      • filter, dry, separate,...
    • Finishing
      • Restore some properties (Metals).
      • Superficial treatments.
        • Polishing or painting.
    • Bottling or packaging
      • Bottling or packing lines.

Assembly companies

  • Companies that exclusively assemble final products.

    • Cars, televisions, microwaves.
  • Their components are purchased from external companies.

  • Some processing operations are also carried out internal to the factory.

    • They are not profitable to subcontract.
      • Sheet cutting.
      • Welding.
      • Plastic injection molding.
      • Painting.

Manufacturing companies

  • Companies that manufacture component parts do not belong to any of the previous groups

    • Forges
    • Plastic injection machines
    • Presses
    • CNC machines.
  • Factory layout depends on the product type and volume to be manufactured

    • Later this will be analyzed in more detail

Layout types

  • There are numerous classifications of industry according to their layout.

  • We will use four basic layout groupings or classifications.

    • The grouping is primarily the result of the material flow in the production plant
      • Fixed position layout
      • Process layout
      • Product layout
      • Cellular or combination layout

Fixed position layout

  • The product does not move throughout the production process, the needed resources do.

    • Ships, buildings, trains,…
    • Products with short or immediate needs
      • Milling center, presses,...
  • Historically this layout was also used for custom car production

Process layout

  • Machines are grouped into departments or stations according to the operation that they perform.

    • Presses -> pressing department
    • Lathes -> lathes department
  • Used in companies that manufacture by orders.

    • Specialty parts or components.
      • A small job shop that makes unique dies or fixtures
    • Products that are made in very small batches

Process layout. Advantages

  • The flexibility of products (almost any part that fits within the volumetric boundaries of the machines) is possible.

  • An in depth understanding of a specific process can be obtained.

  • Some tooling and fixtures can be shared.

Process layout. Disadvantages

  • The spaghetti flow is difficult to manage and control.

  • There is usually a lot of inventory in front of each machine.

  • Set up is usually expensive and time consuming.

  • Material handling times are large.

  • It is difficult to automate these types of systems.

Product layout

  • Machines are grouped according to the product manufacturing sequence.

  • These layouts are called manufacturing or assembly lines.

    • High volume component parts are normally produced using a product layout.
  • Assembly companies normally use this type of layout, especially in the automotive sector.

Product layout

  • The layout change carried out by Henry Ford drastically reduced the car production lead time.

    • Some companies are able to manufacture an automobile every 40 seconds.

Product layout. Advantages

  • Large batches can be produced inexpensively

  • Material handling is minimal

  • In-process materials are minimized

  • It is easy to control these systems

  • Automation is more achievable and justifiable

Product layout. Disadvantages

  • They are inflexible, in that only one or very few products can be produced on them.

  • Set-up time for these systems is very large.

  • Duplicate tooling is required to replace worn tooling so that maintenance can be minimized.

Cellular or combination layouts

  • Some companies can not be classified exclusively by one of the previous layout types.

  • Large product manufacturing industries (airplanes or presses) have opted for modularization.

    • Different modules are produced in different lines and assembled as subsets.

Cellular or combination layouts

  • Dismantling sections and creating manufacturing cells to accommodate demand.

    • Special screws manufactures.
    • Cellular layout.
  • Share the critical resource.

    • High cost of the resources.
      • Combination layout between product and process layouts.

Cellular or combination layouts

  • Common first phase and different assembly lines to elaborate the final product.

    • Appliances manufactures.
      • Plastic injection and presses sections, combined with assembly lines grouped by product families.

Characteristic of the traditional layouts

Layout design methodology

  • These next steps are applicable to most of the possible layout problems, they are oriented mainly for a general layout analysis.

  • Step 1. Formulate the problem.

    • Define what is the main objective of the study.
      • Including a new machine?
      • Modifying the existing building?
  • Step 2. Analysis of the problem.

    • Can be carried out in a systematic way.
      • Richard Muther in his now classic book " Practical Plant Layout " presented 8 factors to consider for facilities layout.
        • These factors will be described in the tools section.

Layout design methodology

  • Step 3. Search for alternatives.

    • The analysis of the 8 Muther’s factors enables engineers to define the problem and properly align the solution to the problem.
      • It is important to take into account three practical principles.
        • First the whole and then the details.
        • First the ideal solution and then the practical one.
        • Brainstorming.

Layout design methodology

  • Step 3. Search for alternatives.

    • First the whole and then the details.
      • Giving priority to the general area or total space shared and then to each one of the specific areas.
      • Layered planes are developed to characterize the situation.

Layout design methodology

  • Step 3. Search for alternatives.

    • First the ideal solution and then the practical one.
      • The ideal solution is difficult to reach.
        • The good solutions can be more easily developed.
      • A more particle approach is more worthwhile so as not to waste time and effort analyzing this problem in depth.

Layout design methodology

  • Step 3. Search for alternatives.

    • Brainstorming.
      • The “creation of ideas” with not a single solution being rejected.
      • Consider all the ideas without criticizing them.
        • Being critical at this point can hinder the creativity process.
        • It would not be the first time that, from a seemingly crazy idea, brilliant solutions are obtained.
    • It is also important to remember that factories have a third poorly used dimension.
      • The height or overhead space.

Layout design methodology

  • Step 4. Choose the right solution.

    • Choose the solution that fits best among the solutions that have been proposed in the previous step.
      • Each one of the solutions should be evaluated according to a specific set of criteria.
        • Ranking each alternative from 0 to 10 according to the established criteria.
    • Evaluate each alternative from an economical standpoint.
    • The simplest solution (between those which have received good ranking) will always be the best choice.

Layout design methodology

  • Step 5. Specification of the solution.

    • The accepted solution will need to be fully developed.
    • Take care of safety measures in order to avoid possible future industrial accidents.
      • Occupational Health and Safety Administration (OHSA) regulations and the Labor Risks Prevention Law.
    • Itemize all details for the plan, budgets and schedule for the implementation of the solution.
    • Demonstrate quantitatively that the outlined solution will provide benefits when compared to the current situation.

Layout design methodology

  • Step 6. Design cycle.

    • Includes planning for modifications that arise due to problems that appear while adopting a solution.
      • Budget deviations, problems in the plant installations.
    • At the end of the design process, the plant should work more efficiently.
    • It is always worthwhile to check to see if the adopted solution works as expected.

Tools for layout study. Muther’s 8 factors

  • By analyzing the following 8 factors, it is possible to determine the main layout restrictions and requirements.

    • Choose the best layout from a set of proposed solutions.
  • Muther’s 8 factors.

    • Material factor.
    • Machinery factor.
    • Labor factor.
    • Movement factor.
    • Wait factor.
    • Service factor.
    • Building factor.
    • Change factor.

Muther’s 8 factors. Material factor

  • This factor does not cover the study of the materials that are utilized to manufacture the product.

  • The purpose of this factor is to become familiar with the different production steps that are needed to manufacture the article.

    • Analyze how the material is transformed from raw material to a final product.
    • Should be studied without considering the relative location of each process in the factory.
  • This factor helps to understand the company technology and to know the company range of products.

Muther’s 8 factors. Material factor

  • The machine types and the existing number of machines on the factory floor.

    • Their principle dimensions in case this becomes a critical constraint.
  • Analyze the operating conditions so as to avoid putting incompatible machines together.

    • Vibrations, temperature, etc.
      • A heavy sheet metal press and a precision coordinate measurement machine are not very compatible.

Muther’s 8 factors. Labor factor

  • The staff related with the production department should be counted.

    • Covering machine operators to division heads.
    • Material handling and maintenance operator input is important.
  • It is recommended to use worker-machine diagrams (a tool that will be explained in a subsequent chapter).

    • Discovery of the operations that the worker carries out on the machine and the relative disposition of the elements in the working area to simplify the worker tasks.

Muther’s 8 factors. Movement factor

  • Analyzes the materials flow between working centers.

    • This flow does not add value to the product.
      • As much handling as possible should be eliminated.
        • Completely eliminating movement is an Utopian.
  • There are mainly two tools to analyze the movement between machines.

    • The flow process chart.
    • Transfer matrix.

Muther’s 8 factors. Movement factor

  • Flow process chart.

    • Represents, in a graphic way, the path and the actions carried out on the product.
      • Five standard symbols are used.
      • It is possible to combine two or more of these actions.
    • Circle -> Operation.
    • Arrow -> Transport.
    • Reversed triangle -> storage.
    • Letter D -> a wait or delay.
    • Square -> Inspection.

Muther’s 8 factors. Movement factor

  • Flow process chart.

    • Using these symbols as tools, movement improvements can be envisaged and advantages quantified.

Muther’s 8 factors. Movement factor

  • Transfer matrix

    • A matrix representation of the work flow
      • Shows the fraction of works that flows from a section to all the others including the RM and FP warehouses.
    • Considers the total amount of products that enter in a work center
      • The fraction moving to other work centers is calculated.
        • This is distributed fractionally between the other sections.

Muther’s 8 factors. Movement factor

  • Transfer matrix.

    • Shows the volume of different products that flows between working centers.
  • It is possible to use the same matrix concept but with a differrent perspective.

    • Factors such as the transferred weight or the number of routes executed.
    • These matrixes will help to make the decision of the relative location of the departments in the factory plant

Muther’s 8 factors. Wait factor

  • This factor covers the study of the three main warehouses

    • Raw materials, work-in-process and final product.
  • This factor objective is to determine the required space by each one of the warehouses.

  • Due to the magnitude of the warehouse study, a specific layout project must be outlined.

  • Because the warehouse layout is closely related with its management (planning and control), it will not be studied in this book.

Muther’s 8 factors. Service factor

  • Analyze two different characteristics.

    • The study of environmental workspace conditions
      • Brightness, noises, smells, minimum working space.
        • Decide what the acceptable parameters are with respect the OHSA regulations and the Labor Risks Prevention Law.
    • The working conditions are analyzed, but concerning the plant service staff.
      • These services are mainly, quality, logistics and maintenance.
      • Minimum maneuver space for the forklift trucks or other special equipment used.

Muther’s 8 factors. Building and change factors

  • Building factor.

    • Analyzes the actual useful surface of the building.
      • The plant shape, the columns, the window situation for ventilation, and areas of possible extension.
      • The surface area covered by gantry cranes limits the number of layout alternatives.
  • Change factor.

    • The proposed layout will not be valid forever.
    • The factor intends to observe, from a critical point of view, the adopted solution.
      • The application of this factor is without a doubt the most difficult part of the study.
      • Ask for future company plans.


  • This chapter has demonstrated how material flow can significantly be improved by means of layout analysis. In this kind of improvement projects, the study of the current situation allows to identify constraints that reduce the number of possible alternatives to be considered. The proposed improvements will reduce the material flow, allowing the company to raise the one-piece-flow proposed by the Lean Manufacturing philosophy.

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