CHAPTER 2: PLANT DESIGN
Terms
Plant location : site for a plant
Plant layout: how departments are positioned
relative to each other and how its various tasks are
allocated to these departments.
Facilities layout: all the facilities, machines,
equipment and staff in the operation.
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Plant layout
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Facility Layout
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Contd…
Plant location problem is an important
strategic level decision making for an
organization.
It is not advisable or not possible to change
the location very often. So an improper location
of plant may lead to waste of all the
investments.
The purpose of the location study is to find an
optimum location one that will result in the
greatest advantage to the organization.
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2.1 FACTORS INFLUENCING PLANT
LOCATION/FACILITY LOCATION
Tangible cost based factors such as wages
and products costs can be quantified
precisely into what makes locations better
to compare.
Non-tangible features , which refer to such
characteristics as reliability, availability
and security, can only be measured along an
ordinal or even nominal scale.
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Locational Factors
1 Proximity to markets:
Locating nearer to the market is preferred if
The products are delicate and susceptible
to spoilage.
After sales services are promptly required
very often.
Transportation cost is high and increase
the cost significantly.
Shelf life of the product is low.
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Contd…
2. Supply of raw material:
General guidelines regarding effects of raw materials on
plant location are:
When a single raw material is used without loss of
weight, locate the plant at the raw material source, at
the market or at any point in between.
When weight loosing raw material is demanded, locate
the plant at the raw material source.
When raw material is universally available, locate close
to the market area.
If the raw materials are processed from variety of
locations, the plant may be situated so as to minimize
total transportation costs.
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Cont…
3. Transportation Facilities:
There are five basic modes of physical
transportation, air, road, rail, water and pipeline.
4. Infrastructure availability:
The basic infrastructure facilities like power,
water and waste disposal, etc., become the
prominent factors in deciding the location.
5. Labour and wages:
The problem of securing adequate number of
labour and with skills
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Contd…
6. External economies of scale: External
economies of scale can be described as
urbanization and locational economies of scale.
7. Capital: By looking at capital as a location
condition, it is important to distinguish the
physiology of fixed capital in buildings and
equipment from financial capital.
8. Government policy: The policies of the state
governments and local bodies concerning labour
laws, building codes, safety, etc., are the factors
that demand attention.
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Contd…
9. Climatic conditions: The geology of the
area needs to be considered together with
climatic conditions (humidity, temperature).
10. Supporting industries and services: Now a
day the manufacturing organization will not
make all the components and parts by itself
and it subcontracts the work to vendors.
11. Community and labour attitudes:
Community attitude towards their work and
towards the prospective industries can make
or mar the industry.
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2.2 LOCATION MODELS
1. Factor rating method
2. Weighted factor rating method
3. Load-distance method
4. Centre of gravity method
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1. Factor rating method
Steps:
1. Identify the important location factors.
2. Rate each factor according to its relative
importance, i.e., higher the rating is indicative of
prominent factor.
3. Assign each location according to the merits of the
location for each factor.
4. Calculate the rating for each location by multiplying
factor assigned to each location with basic factors
considered.
5. Find the sum of product calculated for each factor
and select best location having highest total score.
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Contd….
Illustration 1: Let us assume that a new medical
facility, Health-care, is to be located in Addis
Ababa. The location factors, factor rating and
scores for two potential sites are shown in the
following table. Which is the best location based
on factor rating method?
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Contd..
The total score for location 2 is higher than that of location 1.
Hence location 2, is the best choice.
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2. Weighted Factor Rating Method
factors are assigned weights based on relative
importance and weightage score for each site using a
preference matrix is calculated
Illustration 2: Let us assume that a new medical facility, Health-care,
is to be located in Addis Ababa. The location factors, weights, and
scores (1 = poor, 5 = excellent) for two potential sites are shown in
the following table. What is the weighted score for these sites?
Which is the best location?
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Contd…
Solution:
Weighed score location 1
= 25 × 3 + 25 × 4 + 25 × 3 + 15 × 1 + 10 × 5
= 75 + 100 + 75 + 15 + 50 = 315
Weighed score location 2
= 25 × 5 + 25 × 3 + 25 × 3 + 15 × 2 + 10 × 3
= 125 + 75 + 75 + 30 + 30 = 335
Location 2 is the best site based on total
weighted scores.
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3. Load-distance Method
The objective is to select a location that minimizes
the total weighted loads moving into and out of the
facility.
Distance measures:
Let the point A on the grid represents the supplier’s location, and the point
B represents the possible warehouse location. The distance between points
A and B is the length of the hypotenuse of a right triangle, or
where dAB = distance between points A and B
dAB = [(XA – XB)2 + (YA – YB)2] XA = x-coordinate of point A
YA = y-coordinate of point A
XB = x-coordinate of point B
YB = y-coordinate of point B 17
Contd…
Rectilinear distance measures distance
between two points with a series of 90° turns
as city blocks.
DAB = |XA – XB| + |YA – YB|
Calculating a load-distance score:
Depending on the industry, a load may be
shipments from suppliers, between plants, or
to customers, or it may be customers or
employees travelling to or from the facility.
These loads may be expressed as tones or
number of trips per period.
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Contd…
Illustration 3: The new Health-care facility is targeted to serve seven
kebelle in Harar. The table given below shows the coordinates for the
centre of each kebelle, along with the projected populations, measured in
thousands. Customers will travel from the seven kebelle centres to the
new facility when they need health-care. Two locations being considered
for the new facility are at (5.5, 4.5) and (7, 2), which are the centres of
kebelle C and F. Details of seven kebelle centres, co-ordinate distances
along with the population for each centre are given below. If we use the
population as the loads and use rectilinear distance, which location is
better in terms of its total load distance score?
kebelle
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Soln…
Summing the scores for all tracts gives a total load-distance score of 239
when the facility is located at (5.5, 4.5) versus a load-distance score of
168 at location (7, 2). Therefore, the location in kebelle F is a better
location.
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4. Centre of Gravity
The centre of gravity method takes into account the
locations of plants and markets, the volume of goods
moved, and transportation costs
The centre of gravity is defined to be the location that
minimizes the weighted distance between the warehouse
and its supply and distribution points,
The centre of gravity is determined by the formula.
Where,
Cx = x-coordinate of the centre of gravity
Cy = y-coordinate of the centre of gravity
Dix = x-coordinate of location i
Diy = y-coordinate of location I
W= load
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Contd…
Illustration 4: The new Health-care facility is
targeted to serve seven kebelles in Addis Ababa. The
table given below shows the coordinates for the
centre of each kebelle, along with the projected
populations, measured in thousands. Customers will
travel from the seven kebelle centres to the new
facility when they need healthcare. Find the target
area’s centre of gravity for the Health-care medical
facility.
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solution
Next we find Cx and Cy.
Cx = 453.5/68 = 6.67
Cy = 205.5/68 = 3.02
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2.3 CLASSIFICATION OF LAYOUT
Layouts can be classified into the following three
categories:
1. Process layout
2. Product layout
3. Fixed position layout
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A. Process Layout
All machines performing similar type of
operations are grouped at one location in the
process layout e.g., all lathes, milling
machines, etc. are grouped in the shop will be
clustered in like groups.
Typically, job shops employ process layouts due to
the variety of products manufactured and their low
production volumes.
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B. Product Layout
In this type of layout, machines and
auxiliary services are located according to
the processing sequence of the product.
The product layout is selected when the volume of production
of a product is high such that a separate production line to
manufacture it can be justified.
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The sequence of processes in paper-making;
C. Fixed Position Layout
This is also called the project type of layout.
In this type of layout, the material, or major
components remain in a fixed location and
tools, machinery, men and other materials
are brought to this location.
This type of layout is suitable when one or a few pieces of identical heavy products are to be
manufactured
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2.4 PRINCIPLES OF PLANT LAYOUT
1. Principle of integration: A good layout is
one that integrates men, materials,
machines and supporting services
2. Principle of minimum distance: This
principle is concerned with the minimum
travel (or movement) of man and
materials.
3. Principle of cubic space utilization: The
good layout is one that utilize both
horizontal and vertical space.
4. Principle of flow: A good layout is one that
makes the materials to move in forward
direction towards the completion stage,
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Contd…
5. Principle of maximum flexibility: The good
layout is one that can be altered without
much cost and time,
6. Principle of safety, security and
satisfaction: A good layout is one that gives
due consideration to workers safety and
satisfaction and safeguards the plant and
machinery against fire, theft, etc.
7. Principle of minimum handling: A good
layout is one that reduces the material
handling to the minimum.
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