Industrial Engineering

ME 010 705

MODULE 2
Module II (9 hours)
Facility planning: Plant location-Procedure for site selection- Plant
layout-Objectives and principles of plant layout- types of layout-
Factors influencing layout- introduction to layouts based on group
technology, just-in-time and cellular manufacturing systems.
Material Handling: Functions and Principles of material handling,
Selection of material handling equipments-types of material handling
equipments.
 Facility Planning
2.1 Plant design
A factory or manufacturing plant or simply plant is an industrial site,
usually consisting of buildings and machinery, or more commonly a
complex having several buildings, where workers manufacture goods or
operate machines processing one product into another. Plant design
involves the planning of various processes needed to accomplish a
physical or chemical transformation of certain types of materials. Plant
design may be used to design a new facility or to expand or modify an
existing facility. Although it typically begins at a conceptual level, plant
design usually ends with the creation of some type of fabrication or
construction plans.
2.2 Plant location
Plant location or facility location refers to the choice of region and the
selection of a particular site for setting up a business or factory. Units
concerning both manufacturing as well as the assembling of the products
are on a very large scale affected by the decisions involving the location
of the plant. Location of the plant itself becomes a very important factor
 2.2 Plant location
concerning service facilities, as the plant location decisions are strategic
and long-term in nature.
The selection of location is a key-decision as large investment is made in
building plant and machinery. 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 made in building and machinery,
equipment.
Before a location for a plant is selected, long range forecasts should be
made anticipating future needs of the company. The plant location should
be based on the companys expansion plan and policy, diversification
plan for the products, changing market conditions, the changing sources
of raw materials and many other factors that influence the choice of the
location decision. The purpose of the location study is to find an
optimum location one that will result in the greatest advantage to the
organization.
 2.2 Plant location
2.2.1. Need for selecting a suitable location
The need for selecting a suitable location arises because of two
situations.
1. When starting a new factory.
2. In case of existing factory.
Plant location decisions are very important for all types of business units.
This is because it affects the cost, selling price, and demand of the
product. It is a nonrecurring heavy expenditure.
Following are the importance reasons for selecting a suitable location.
1. Expansion - If the company wants to expand and diversify its
activities, it will have to search for a new-location for setting up its new
business unit. In this case, it will need a location planning.
2. Discovery of raw material - Generally, a plant must be located at a
place where raw-material is available. For example, if oil and gas are
found at some place, then a new petrochemical plant has to be set up
there for processing purpose.t
 2.2.1. Need for selecting a suitable location
3. Cost advantages - If an existing plant is not near a market place, it will
increase the transport cost. This will also increase the cost of the product.
So, to avoid this, the company will search for a new plant location which
is near the market. Such location of plant must be convenient to the
employees and must have a regular supply of water and electricity.
Overall, this will result in reduction of the cost of production.
4. Additional facilities - Plant location-related decisions will have to be
taken if the organization wants additional facilities. New facilities may
be necessary to improve the quality of work, to meet rising demands, etc.
5. Political and social changes - Each political party has its own
philosophy. Political changes can lead to changes in economic policies of
the government. This may make the existing location unattractive for
doing business. Social changes may require production of eco-friendly
goods. This may require a change in location.
6. Avail tax benefits - Government may announce some tax benefits for
starting a business in rural areas. This may motivate entrepreneurs to
start their business units in remote areas.
 2.2.2. Factors affecting plant location
Plant location must be selected properly by entrepreneurs while planning
to set up their business units. While taking such a decision, they must
consider important factors which are classified under controllable factors
and uncontrollable factors.
 2.2.2. Factors affecting plant location
Controllable factors
1. Nearness of markets - Plant location must be near a market. Every
business unit depends on a market for selling its goods and services. The
goods and services must reach the market on time, and it must be
available to the consumers at a low price. Therefore, this factor is given
importance while selecting location of a plant. Locating a plant near the
market is preferred, when the product is fragile (easily breakable),
perishable, heavy or bulky and when quick service is required. Nearness
of market ensures a consistent supply of goods and reduces the cost of
transportation.
2. Nearness to raw-materials' source - It is essential for the organization
to get raw material in right quantities and time in order to have an
uninterrupted production. This factor becomes very important if the
materials are perishable and cost of transportation is very high.
3. Transport facilities - Speedy transport facilities ensure timely supply
of raw materials to the company and finished goods to the customers.
The transport facility is a prerequisite for the location of the plant. There
 2.2.2. Factors affecting plant location- Controllable factors
are five basic modes of physical transportation, air, road, rail, water and
pipeline. Goods that are mainly intended for exports demand a location
near to the port or large airport. The choice of transport method and
hence, the location will depend on relative costs, convenience, and
suitability. Thus, transportation cost to value added is one of the criteria
for plant location.
4. Infrastructure availability - Plant location which is selected must
have proper infrastructure facilities. Without good infrastructure
facilities, it will be difficult to do business efficiently. The infrastructure
facilities are the backbone of all industries. The basic infrastructure
facilities like power, water and waste disposal, etc., become the
prominent factors in deciding the location.
5. Labour and wages - Plant location must be convenient and easily
accessible to skilled workforce. Most businesses require skilled-labor
force such as engineers, management experts, computer programmers,
etc. The entrepreneurs must consider the availability of competent and
skillful workforce at a particular place to locate their business.
 2.2.2. Factors affecting plant location- Controllable factors
Productivity of labour is also an important factor to be considered.
Prevailing wage pattern, cost of living and industrial relation and
bargaining power of the unions forms in important considerations.
Uncontrollable factors
1. Law and taxation - Plant location must be in those states whose
governments have an investor-friendly attitude. Government must give
attractive incentives and concessions to those who start business units in
their states. There must not be any bureaucratic control for starting a
business. An investor-friendly attitude will not only attract investment,
but will also result in the overall development. The policies of
governments and local bodies concerning labour laws, building codes,
safety, etc., are factors that demand attention.
2. Suitability of land and climate - The geology of the area together with
climatic conditions influence human efficiency and output. Climates
greatly influence human efficiency and behavior.
3. Supporting industries and services - Plant location must be near its
supporting industries and services. If it purchases spare parts from an
 2.2.2. Factors affecting plant location- Uncontrollable factors
outside agency, then these agencies must be located very close to the
business. Various services like telecommunication, banking service and
professional consultancy services play a vital role in selection of
location.
2.3. Quantitative methods for plant location selection
Various quantitative methods are available which help to identify the
ideal location. Some of the popular quantitative methods are discussed
below.
1. Factor rating method - The process of selecting a new facility
location involves a series of following steps.
a) Identify the important location factors.
b) Rate each factor according to its relative importance, i.e., higher the
ratings is indicative of prominent factor.
c) Assign each location according to the merits of the location for each
factor.
d) Calculate the rating for each location by multiplying factor assigned to
each location with basic factors considered.
 2.3. Quantitative methods for plant location selection
e) Find the sum of product calculated for each factor and select best
location having highest total score.
The following illustration will help to understand the concept of
Factor Rating Method.
Let us assume that a new medical facility, Health-care, is to be located
in Delhi. 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?
 2.3. Quantitative methods for plant location selection
The total score for location 2 is higher than that of location 1. Hence
location 2, is the best choice.
2. Method based on the economics of various sites - The ideal location
for the plant be such that the cost of procuring the materials and
processing them into products and distribution of finished goods to the
customer should be minimum. The various costs which decide economy
of a location are those of land, building, equipment, labour, material, etc.
Other factors like community attitude, community facilities and housing
facilities will also influence the selection of best location. Economic
analysis is carried out to decide as to which locate best location.
Example:- An ABC company intends to select one of the three locations
viz., X, Y and Z. From the following data select the most advantageous
location.
 2.3. Quantitative methods for plant location selection

Location Y can be selected because of higher rate of return.

 2.4. Procedure for site selection
The general procedure for site selection is explained below.
1. Identification of alternatives First step involved for site selection
process is to identify the various geographical locations which are
suitable for construction of plant considering the various factors for plant
selection such as availability of raw materials, transport facilities,
nearness of markets, etc.
2. Evaluation of alternatives - From the identified locations, location
analysis carried out. Based on the availability of data quantitative or
qualitative methods of chooses for location analysis.
3. Site selection phases In this phase, the most suitable and feasible
site is chosen based on the result of location analysis.
2.5. Plant Layout
The efficiency of production depends on how well the various machines;
production facilities and employees amenities are located in a plant.
Only the properly laid out plant can ensure the smooth and rapid
movement of material, from the raw material stage to the end product
 2.5. Plant Layout
stage. It may be defined as a technique of locating machines, processes
and plant services within the factory so as to achieve the right quantity
and quality of output at the lowest possible cost of manufacturing. It
involves a judicious arrangement of production facilities.
Plant layout refers to the arrangement of physical facilities such as
machinery, equipment, etc., within the factory building in such a manner
so as to have smooth flow of material at the lowest cost and with the
least amount of handling in processing the product from the receipt of
material to the shipment of the finished product.
2.5.1 Factors influencing layout
1. Type of industry - Industries are generally classified according to their
processes of manufacture. The process of manufacture can be classified
into four categories.
a) Synthetic process - When two or more materials are mixed to get a
product, the process is known as synthetic process. The example of such
a process is to produce the cement by mixing limestone and clay.
 2.5.1 Factors influencing layout
b) Analytical process - This is opposite to synthetic process. It is the
breaking up of a material into several parts. The refining of petroleum
and extraction of oxygen from air are some of the examples.
c) Conditioning process - In the conditioning process, the form of raw
materials is changed into desired product as in jute industry.
d) Extractive process - In this type by applying heat desired product is
extracted from the original raw material eg. manufacture of aluminum
from bauxite.
2. Nature of product - The nature of the product to be manufactured will
significantly affect the layout of the plant. Stationary layout will be most
suitable for heavy products while, line layout will be best for the
manufacture for the light products because small and light products can
be moved from one machine to another very easily and, therefore, more
attention can be paid to machine locations can be paid to machine
locations and handling of materials.
3. Type of machinery - Nature of machines and equipment also affects
the layout of plants. If machines are heavy in weight or create noisy
 2.5.1 Factors influencing layout
atmosphere, stationery layout may reasonably be adopted. Heavy
machines are generally fixed on the ground floor. Ample space should be
provided for complicated machines to avoid accidents.
4. Nature of materials - Design and specification of materials, quantity
and quality of materials and combination of materials are probably the
most important factors to be considered in planning a layout. So,
materials storage, space, volume and weight of raw materials, floor load
capacity, ceiling height, method of storing, etc. should be given special
consideration.
5. Volume of production - Plant layout should be done based on the
volume to be produced.
6. Human factor and working conditions - Men are the most important
factor of production and therefore special consideration for their safety
and comforts should be given while planning a layout, safety items like
obstruction-free floor, workers not exposed to hazards, etc.
7. Factory building - Shape of building, covered and open area, number
of stores, facilities of elevators, parking area and so on also influence the
 2.5.1 Factors influencing layout
Layout plan. In most of the cases where building is hired, layout is to be
adjusted within the spaces available in the building.
8. Influence of manufacturing processes - The process through material
passes will affect layout. Care should be given to the material handling
problems, position of store room and tool room.
2.5.2 Main Objectives of Plant Layout

The main objectives of plant layout is to provide the following features

1. Have enough of material handling spaces.
2. Proper and efficient use of floor space.
3. Ensure proper flow of goods and processes without any delay.
4. Provision for supervision and control.
5. Careful planning to avoid changes and re-layout of a plant.
6. Provision of safety to workers.
7. Meet quality and capacity requirement in the most economical manner.
8. Provision of adequate medical facilities and refreshment facilities.
 2.5.3 Principles of Plant Layout
1. Principle of integration - A good layout is one that integrates men,
materials, machines and supporting services and others in order to get the
optimum utilization of resources and maximum effectiveness.
2. Principle of minimum distance - This principle is concerned with the
minimum travel (or movement) of man and materials. The facilities
should be arranged such that, the total distance travelled by the men and
materials should be minimum and as far as possible straight line
movement should be preferred.
3. Principle of cubic space utilization- The good layout is one that
utilizes both horizontal and vertical space. It is not only enough if only
the floor space is utilized optimally but the third dimension, i.e., the
height is also to be utilized effectively.
4. Principle of flow - A good layout is one that makes the materials to
move in forward direction towards the completion stage, i.e., there
should not be any backtracking. Since straight line is the shortest
distance between any two, points, materials as far as possible should be
made to move on the principle of straight-line flow.
 2.5.3 Principles of Plant Layout
5. Principle of maximum flexibility - The good layout is one that can be
altered without much cost and time, i.e., future requirements should be
taken into account while designing the present layout.
6. Principle of safety and 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.
2.5.4 Features of Plant Layout
1. Sufficient space for worker and machine to perform their tasks.
2. Must have adequate safety and security to workers against accidents.
For eg. provision of first aid box, fire extinguishers, etc.
3. Sufficient way space for raw materials, workers and semi finished
products.
4. Arrangement of machines and equipment in such a way that it
minimizes material handling and costs.
5. Stores for in-process material should be near to processing machines.
 2.5.4 Features of Plant Layout
6. Supervision, co-ordination and control should be easily and effectively
carried.
7. Scope for further adjustments and extensions should be sufficient
enough.
2.5.5 Steps in planning plant layout
Various steps involved in planning plant layout are discussed below.
1. The first thing is planning a layout is to study the objectives,
production plan and the nature of machines, equipment and
manufacturing operations involved in the production process.
2. On the basis of information collected, develop process charts which
are vital in the development of a sound layout. These charts summaries
the production activities that are required to achieve the manufacturing
objectives.
3. Develop an over-all flow plan of operations for efficient processing
and materials handling.
4. The sequence of mechanical operations is studied to fix the position of
respective machines performing desired operations.
 2.5.5 Steps in planning plant layout
5. Select best suited type of building and develop a tentative plot plan for
the site. The exact specifications of the building are made only after the
layout is developed in detail.
6. Layout models of individual production, machines and space for
service activities, materials handling, receiving and shipping, inspection,
storage, maintenance, offices, etc., according to flow plan operations.
Decision about the location of services facilities like cafeteria, toilets,
etc. Inside the plant building is taken, keeping into consideration the
requirements of the production process and comforts of the workers. The
position of windows, ventilators, electric fittings, drainage of the layout
is the drawn.
7. After analyzing all the details, drawings of the layout are drawn and
the production run is tested.
8. Modifications can be done according to the experience of test runs.
 2.5.6. Weakness of a poor plant layout
1. Low production density and under utilization of plant capacity.
2. Lack of flexibility in the plant production facilities.
3. Long processing time due to delays, temporary storage, bottle-necks,
etc.
4. Improper utilization of plant.
5. Uneconomical material handling.
6. Costly inspection and difficulty in maintaining quality standards.
7. Inadequate storage facilities.
8. Equipment and production machinery not accessible for maintenance
and repair due to layout.
9. Poor lighting, ventilation, air cleaning arrangement is in the layout.
10. Inadequate safety provisions for workers.
 2.6. Types of plant layout
In case of manufacturing unit, plant layout may be of five types.
1. Product layout
2. Process layout
3. Fixed position layout
4. Combination layout
5. Group layout
2.6.1 Product layout

In product layout or line layout, machines and equipments are arranged

in the sequence of manufacturing operations required for the product.
The material is moved from one work station to another sequentially
without any backtracking or deviation. The output of one machine
 2.6.1 Product layout
becomes input of the next. The raw materials are fed at one end and
taken out as the finished product on the other end. e.g. in a paper mill,
bamboos are fed into the machine at one end and paper comes out at the
other end. A product layout may assume a straight line shape, a V-shape
or circular shape. Production layout is used when production is mass,
limited variety and for a product having steady demand. 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. In
a strict product layout, machines are not shared by different products.
Therefore, the production volume must be sufficient to achieve
satisfactory utilization of the equipment. A product layout is shown in the
figure.
Advantages of product layout
1. Low cost of material handling, due to straight and short route and
absence of backtracking
2. Simplified production, planning and control.
3. Small amount of work in process inventory..
 2.6.1 Product layout
4. Unskilled workers can learn and manage the production.
5. Manufacturing cycle is short due to uninterrupted flow of materials.
6. Less space is occupied by work transit and for temporary storage.
Disadvantages of product layout
1. Product layout lack in flexibility as a change in product may require
the facility modification.
2. Large capital investment.
3. Dedicated or special purpose machines are needed.
4. Breakdown of any one machine in the sequence may result in stoppage
of production.
Suitability of product layout
Product layout is useful under following conditions.
1. Mass production of standardized products.
2. Simple and repetitive manufacturing process.
3. Operation time for different process is more or less equal.
4. Reasonably stable demand for the product.
5. Continuous supply of materials.
 2.6.1 Product layout
Therefore, the manufacturing units involving continuous manufacturing
process, producing few standardized products continuously in
anticipation of sales would prefer product layout e.g. paper, rubber,
automobiles, and electronics, etc.
2.6.2 Process layout

In process layout or functional layout, machines performing similar type

of operations are located together according to their function. eg. All
 2.6.2 Process layout
lathes, all milling machines grouped in the shop. Products moves
between the groups of equipments in order of the operations required.
Hence, such layouts typically have drilling department, milling
department, etc. The flow paths of material through the facilities from
one functional area to another vary from product to product. Usually the
paths are long and there will be possibility of backtracking. This layout is
recommended for batch production and for producing variety of
products. A typical process layout is shown in the figure.
Advantages of process layout
1. Flexibility of equipment.
2. Lower investment.
3. Higher utilization of production facilities.
Disadvantages of process layout
1. More space is required.
2. Production planning and control is difficult.
3. Lowered productivity due to multiple setups.
 2.6.2 Process layout
Suitability of process layout
1. Products are not standardized.
2. Quantity produced is small.
4. There are frequent changes in design and style of product.
5. Machines are very expensive.
Thus, functional layout is suitable for job order production involving
nonrepetitive processes and non-standardized products, e.g. tailoring,
light and heavy engineering products, jewelry, etc.
2.6.3 Fixed position layout
Layout by fixed position (project
layout) of the product is used in
ship building, aircraft
manufacture and big pressure
vessels fabrication. In this
layout, men and equipment
moved to the material, which
 2.6.3 Fixed position layout
remains at one place and product is completed at that place where the
material lies.
Advantages of fixed position layout
1. Layout capital investment is lower.
2. Greater flexibility.
3. Helps in job enlargement and upgrades skills of the operators.
Disadvantages of fixed position layout
1. Cost of moving material is high.
2. Makes only one or few pieces of product.
Suitability of fixed position layout
The fixed position layout is followed in following conditions.
1. Manufacture of bulky and heavy products such as locomotives, ships,
boilers, generators, wagon building, aircraft manufacturing, etc.
2. Construction of building, flyovers, dams.
3. Hospital, the medicines, doctors and nurses are taken to the patient
(product).
 2.6.3 Fixed position layout
This type of layout is suitable when one or a few pieces of identical
heavy products are to be manufactured and when the assembly consists
of large number of heavy parts, the cost of transportation of these parts is
very high.
2.6.4 Combination layout
Many situations requires for a mixture of the three main layout types.
These mixtures are commonly called combination or hybrid layouts.
 2.3.4 Combination layout
Generally, a combination of the product and process layout or other
combination are found, in practice, e.g. for industries involving the
fabrication of parts and assembly, fabrication tends to employ the process
layout, while the assembly areas often employ the product layout. In
soap, manufacturing plant, the machinery manufacturing soap is
arranged on the product line principle, but ancillary services such as
heating, the manufacturing of glycerin, the power house, the water
treatment plant, etc., are arranged on a functional basis.
A combination of process and product layouts combines the advantages
of both types of layouts. A combination layout is possible where an item
is being made in different types and sizes. Here, machineries are
arranged in a process layout but the process grouping is then arranged in
a sequence to manufacture various types and sizes of products. It is to be
noted that the sequence of operations remains same with the variety of
products and sizes. The figure shows a combination type of layout for
manufacturing different sized gears.
 2.6.5 Group Layout

There is a trend now to bring an element of flexibility into manufacturing

system as regards to variation in batch sizes and sequence of operations.
A grouping of equipment for performing a sequence of operations on
family of similar components or products has become all the important.

Group layout is configured to support cellular manufacturing. In cellular

manufacturing, machines are grouped according to the process
requirements for a set of similar items (part families) that require similar
 2.6.5 Group Layout
processing. These groups are called cells. Processes are grouped into
cells using a technique known as group technology (GT). Group
technology involves identifying parts with similar design characteristics
(size, shape and function) and similar process characteristics (type of
processing required, available machinery that performs this type of
process, and processing sequence). Thus, group layout is a combination
of the product layout and process layout. It combines the advantages of
both layout systems. In-group technology layout, the objective is to
minimize the sum of the cost of transportation and the cost of
equipments.
Advantages of group layout
1. Group technology combines the benefit of both the product and
process layout.
2. Group technology reduces work-in-process by production smoothing
and line balancing. Small lot sizes also reduce the work-in-process and
inventory in the system.
 2.6.5 Group Layout
3. Group technology reduces set-up time by the use of modernized
computer integrated technology and individual similar jobs in the same
group.
4. Group technology reduces material handling cost by automation of the
material handling system.
5. Group technology leads to better scheduling.
6. Group technology makes the optimum use of the input resources like
men, machines and material.
7. In a modernized plant, group technology is the only type of plant
layout resorted to due to its adaptability to FMS, JIT manufacturing, etc.
Disadvantages of group layout
1. There is difficulty in grouping into the sub-families.
2. Grouping may lead to duplication of machine tools.
3. In group technology, the flow analysis may be difficult.
4. Sometimes group technology may need duplication of machine tools
in separate cells which can be overcome by creating a technology centre
within the GT Cell.
2.6.6. Comparison between process layout and product layout
 2.6.6. Comparison between process layout and product layout

When to use process, product and fixed position layout

1. Process layout is used when
a) Machinery is highly expensive and not easily moved.
b) Variety of products is high and "make to order" production.
c) There is a wide variation in cycle time of operations of products.
d) There is small or intermittent demand for the products.
2. Product layout is used when
a)Production is "make to stock" or mass production system.
b) Limited variety, standardized product and low volume.
c) Steady demand for the product.
d) Balanced operations and continuity of material flow.
 2.6.6. Comparison between process layout and product layout
3. Fixed position layout is used when
a) The operation requires only hand tools or single machine.
b) Making only one or few pieces of product,
c) The cost of moving material is very high. The skill of workmanship
lies in the abilities of workers.
2.7. Group Technology (GT)
In group technology or GT, the operations of the job and their sequences
are analyzed to form certain family of jobs. Depending upon the family, a
number of machines are grouped together in each work centre. Group
technology is a manufacturing philosophy in which the parts having
similarities (geometry, manufacturing process and/or function) are
grouped together to achieve higher level of integration between the
design and manufacturing functions of a firm. The aim is to reduce work-
in-progress and improve delivery performance by reducing lead times.
 2.7 Group Technology (GT)

GT is based on a general principle that many problems are similar and by

grouping similar problems, a single solution can be found to a set of
problems, thus saving time and effort. The group of parts that possess
similarities in geometric shape, and size or in the processing steps used
in their manufacture is known as part family. Geometric classification of
families is normally based on size and shape, while production process
classification is based on the type, sequence, and number of operations.
 2.7 Group Technology (GT)
The type of operation is determined by such things as the method of
processing, the method of holding the part, the tooling, and the
conditions of processing. The work centres are then arranged in a proper
sequential order, so that these families of jobs flow through the work
centre smoothly. The objective here is to minimize the setting time and
throughput time. Group technology is the realization that many problems
are similar and that by grouping similar problems, a single situation can
be found to a set of problems, thus saving time and effort.
2.7.1 Methods for developing part families
The basic methods that can be used to form part families are as follows.
1. Manual visual search-Manual visual search methods is the judgment
to group parts into appropriate families based on visual inspection of the
parts or photos of the parts.
2. Classification and coding - Coding of a part is the process of
assigning symbols to the part. These symbols have meanings that reflect
the attributes of the part, thereby facilitating the formation of part
 2.7.1 Methods for developing part families
families. A coding system uses digits or alphanumeric codes to represent
a group (family) of similar parts. For example, a coding system can have
0 representing any rotational parts and 1 representing any non-
rotational parts. Classification refers to the process of categorization of a
set of parts into part families.
3. Production Flow Analysis/Clustering method In Production Flow
Analysis (PFA), the parts that go through common operations are
grouped into part families. Similarly, the machines used to perform these
common operations may be grouped as a cell. PFA system does not use
coding system or part drawing to identify families.
2.7.2. The benefits of group technology classification
1. Reduced purchasing cost through volume purchasing- can purchase
fewer different items at higher volumes.
2. Accurate cost estimation- estimate the future price range with a
standard cost database.
3. Quicker reaction to design changes.
 2.7.2. The benefits of group technology classification
4. Quickly identify newer material or parts that conform to newer
designs and specifications
5. Better communication between the buyer and the supplier.
6. Eliminate the human errors with classification.
2.7.3 Demerits of group technology classification
1. Management resistance to change- unwilling to devote the time and
energy.
2. Extensive data requirements.
3. The proper identification needs detailed item descriptions.
4. High start-up cost.
 2.8 Flexible Manufacturing Systems
A Flexible Manufacturing System (FMS) is a manufacturing system in
which there is some amount of flexibility that allows the system to react
in the case of changes, whether predicted or unpredicted. Flexibility
covers the system's ability to be changed to produce new product types,
ability to change the order of operations executed on a part, system's
ability to absorb large-scale changes, such as in volume, capacity, or
capability, etc. Most FMS systems consist of three main systems; the
work machines which are often automated CNC machines are connected
by a material handling system to optimize parts flow and the central
control computer which controls material movements and machine flow.
The main advantages of an FMS are its high flexibility in managing
manufacturing resources like time and effort in order to manufacture a
new product.
When machines are used to manufacture a variety of
products/components this is called machine flexibility. A good example
is a company that specializes in manufacturing injection molded
components. The component design may change very quickly but as long
MAJOR ELEMENTS OF FMS
 2.8 Flexible Manufacturing Systems
as the mould is updated / modified the injection molding machine can
still operate. Machines of this nature are adaptable and are ideal for
FMS.
2.8.1 Different types of flexibility
The different types of flexibility that are exhibited by manufacturing
systems are given below.
1. Machine flexibility - It is the capability to adapt a given machine in
the system to a wide range of production operations and part styles.
2. Production flexibility - It is the range of part that can be produced by
the production systems.
3. Product flexibility - It refers to ability to change over to a new set of
products economically and quickly in response to the changing market
requirements.
4. Volume flexibility - It is the ability of the system to vary the
production volumes of different products to accommodate changes in
demand while remaining profitable.
 2.8.2 Basic components of FMS
1. Workstations - They are typically Numerical Control Machine tools
that perform machining operations on families of parts.
2. Computer control system - It is the main brain that includes various
software and hardware. This subsystem controls the machinery and
equipment in workstations and transportation of materials in various
stages. It is used to coordinate the activities of the processing stations
and the material handling system in the FMS.
3. Work holding and tooling devices - It includes fixtures, tool changers,
tool identification systems, coolant, and chip removal systems.
4. Material handling equipments - The material handling equipments
used in FMS include robots, conveyers, automated guided vehicle
systems, monorails and other rail guided vehicles, and other specially
designed vehicles.
5. Inspection equipment - It includes Coordinate Measuring Machines
(CMMs) used for offline inspection and programmed to measure
dimensions, concentricity, perpendicularity, and flatness of surfaces.
 2.8.3 Advantages of flexible manufacturing systems
1. Reduced manufacturing times.
2. Greater labor productivity.
3. Greater machine efficiency.
2.8.4 Disadvantages of flexible manufacturing Systems
1. Cost to implement.
2. Substantial pre-planning.
3. Requirement of skilled labour.

2.9 Just In Time manufacturing (JIT)

JIT is a special tool developed in Toyota Motor Co., Japan, to improve
the quality and performance of various workstations during the
production and delivery of goods. It is a Japanese management
philosophy applied in manufacturing which involves having right items
of the right quantity in right place at right time. Just in time production is
defined as a philosophy that focuses attention on eliminating wasteby
purchasing or manufacturing just enough of right items just in time".
 2.9 Just In Time manufacturing (JIT)
The phrase just in time is used to because this system operates with
low WIP (Work-In-Process) inventory and often with very low finished
goods inventory. Products are assembled just before they are sold,
subassemblies are made just before they are assembled and components
are made and fabricated just before subassemblies are made. This leads
to lower WIP and reduced lead times. JIT is aimed at providing a cost
efficient production in an organization and delivery of only the
necessary parts in the right quantity at the right place while using the
minimum of facilities.
The JIT philosophy starts from purchasing the raw materials and is also
used in the production of components, waste elimination and reduction
of cost at every stage of production using quality concept. Pioneers of
JIT are UI Edwards Demings in Japan in 1950, J.M. Juran 1954, Kaoru
Ishikawa and Nippon Wireless and Telegraph Company in 1962 used
Ishakawas suggestions successfully.
 2.9.1 Characteristics of JIT management
Following are the important characteristics of JIT systems.
1. Pull method of materials flow - Just-in-time systems utilize the pull
method of materials flow. However, another popular method is the push
method. In push method, the production of the item begins in advance of
customer needs. In the pull method, customer demand activates
production of the item. Manufacturing firms that tend to have highly
repetitive manufacturing processes and well-defined material flows use
JIT systems because the pull method allows closer control of inventory
and production at the workstations. Other firms, such as those producing
a large variety of products in low volumes with low repeatability in the
production process, tend to use a push. In this case inventory can
accumulate at each workstation.
2. Consistently high quality - JIT systems seek to eliminate scrap and
rework in order to achieve a uniform flow of materials. Efficient JIT
operations require conformance to product or service specifications and
implementation of the behavioral and statistical methods of total quality
management (TQM). JIT systems control quality at the source, with
 2.9.1 Characteristics of JIT management
workers acting as their own quality inspectors.
3. Small lot sizes - Users of JIT systems maintain inventory with lot sizes
that are as small as possible. Although small lot sizes are beneficial to
operations, they have the disadvantage of increased setup frequency.
4. Uniform workstation loads - The JIT system works best if the daily
load on individual workstations is relatively uniform. Uniform loads can
be achieved by assembling the same type and number of units each day,
thus creating a uniform daily demand at all workstations.
5. Close supplier ties - Because JIT systems operate with very low levels
of inventory, close relationships with suppliers are necessary.
6. Automated production - Automation plays a big role in JIT systems
and is a key to low cost production.
2.9.2 Principles of JIT
1. Inventory and materials handling costs are as important as direct labor
cost. They do not add to the value of product. The inventory carrying
costs are as high as 30% of inventory cost. High technology industries
such as missiles, air planes, computers and telecommunication incur
 2.9.2 Principles of JIT
higher inventory costs than consumer products, metal processing and
industrial hard wares. The Just in Time procurement of materials and
reducing inventory level reduces this cost.
2. Material handling investment if reduced by effective manual handling
which can preserve capital for more effective use which is possible by
using JIT methods.
3. By installation of processing equipment with effective handling
methods and upgrading materials handling systems with lesser cost
reduces cost of production in JIT manufacturing.
4. The purpose of JIT is to eliminate waste which can be excess
inventory, damaged materials, process defects, repetitive handling and
The core principle objective of Just in Time (JIT) is to improve process
efficiency by eliminating waste. Following are the seven wastes.
1. Overproduction - Manufacture of products in advance or in excess of
demand wastes money, time and space.
2. Waiting - Processes are ineffective and time is wasted when one
process waits to begin while another finishes. Instead, the flow of
 2.9.2 Principles of JIT
operations should be smooth and continuous. According to some
estimates, as much as 99 percent of a product's time in manufacture is
actually spent waiting.
3. Transportation - Moving a product between manufacturing processes
adds no value, is expensive and can cause damage or product
deterioration.
4. Inappropriate processing - Overly elaborate and expensive equipment
is wasteful if simpler machinery would work as well.
5. Excessive inventory - Excessive inventory wastes resources through
costs of storage and maintenance.
6. Unnecessary motion - Resources are wasted when workers have to
bend, reach or walk distances to do their jobs. Workplace ergonomics
assessment should be conducted to design a more efficient environment.
7. Defects - Inspecting and quarantining inventory takes time and costs
money.
 2.9.3 Benefits of JIT
1. Less inventory of raw materials.
2. Reduction of wastes and increased ability to remain competitive
through customer service and delivering superior performance of both
goods and services.
3. There is a massive reduction in work-in-process which results in lower
space requirements.
4. Stronger and more reliable working relations with suppliers.
5. Higher profits, reduction in lead time to customer and improved
customer satisfaction.
6. Improved working relations between employees.
2.9.10 Limitations of JIT
1. Cultural differences have been cited as possible limitation, since it has
been culturally bound and somewhat limited to Japanese environment.
2. Success of JIT system depends on the cooperation between employer-
employee, training of operators, adaptability to market function, etc.
3. There is no flexibility-only first come first served.
4. There is no safety stock to offset inaccurate demand forecast.
 2.9.10 Limitations of JIT
5. Effective only when the daily demands are fairly stable.
6. Workers attitude and culture should be improved to implement this
system.
2.10 Material Handling
In order to convert the raw materials into finished products, it is essential
that one of the basic elements of production, i.e., material, men or
machines should move. In majority of the industrial processes, it is the
material that moves from raw material stage to the stage of when it
becomes the finished goods. As, the material is more widely moved
rather than the men or machines, hence the name "material handling"
Material handling can be defined as material handling embraces the
basic operations in connection with the movement of bulk, packaged and
individual products in a semi-solid or solid state by means of gravity
manually or power-actuated equipment and within the limits of
individual producing, fabricating, processing or service establishment.
Material handling includes all movement and packing of materials,
component parts, assemblies and products. Handling of goods between
 2.10 Material Handling
plants normally called transportation is a subdivision of material
handling. It includes all movement of materials form the receipt of the
raw materials to the shipment of product. Material handling does not add
any value to the product but adds to the cost of the product and hence it
will cost the customer more. So the handling should be kept at minimum.
The cost of material handling consists of cost of buying it, maintaining it
and operating it.
2.10.1 Objectives of material handling
Following are the objectives of material handling:-
1. Minimize cost of material handling.
2. Minimize delays and interruptions by making available the materials
at the point of use at right quantity and at right time.
3. Safety in material handling through improvement in working
condition.
4. Maximum utilization of material handling equipment.
5. Prevention of damages to materials.
6. Lower investment in process inventory.
 2.10 Material Handling
2.10.2 Functions of material handling
In a manufacturing organization, the material handling activities consists
of :-
1. Transportation and handling at suppliers end,
2. Material handling at manufacturing plant,
3. Transportation and handling from warehouse to customer.
The material handling activity in the plant starts with the unloading of
the material after receipt from suppliers, and extends throughout the
processing from raw material stage till it is manufactured and stored in
the warehouse to be dispatched to the customer.
 2.10 Material Handling
2.10.4 Elements of material handling
1. Motion - Move in most economic, safe and efficient manner.
2. Time - Provide materials on time.
3. Quantity - Ensure supply of correct quantity continuously.
4. Space - Ensure optimum use of space.
2.10.5 Symptoms of bad material handling
1. Frequent interruption in production due to delay in handling and
supplying materials to the point of use.
2. Skilled labour performing duties like storing, and handling of
materials.
3. Accumulation of work-in-process and materials in different locations.
4. Reworking and rejections due to handling defects.
5. Crowded floor space with scrap and materials.
6. Long waiting for material handling equipment to pick up and deliver
materials.
 2.10 Material Handling

2.10.6 Principles of material handling

Following are the principles of material handling.
1. Planning principle- All handling activities should be planned.
2. Systems principle- Plan a system integrating as many handling
activities as possible covering operations such as receiving, storage,
production, inspection, packing, warehousing, supply and transportation.
3. Space utilization principle- Make optimum use of cubic space.
4. Unit load principle- Unit load will mean a single object where
unitized load mean collection of objects which are being treated as unit
load. The size unit load/unitized load should be optimum so that it can be
efficiently handled by the handling equipment
5. Gravity principle- Utilize gravity to move a material wherever
practicable.
 2.10 Material Handling
2.10.6 Principles of material handling
6. Material flow principle- Plan an operation sequence and equipment
arrangement to optimize material flow.
7. Simplification principle- Reduce combine or eliminate unnecessary
movement and/or equipment.
8. Safety principle- Provide for safe handling methods and equipment.
9.Mechanization principle- Use automated material handling equipment.
10.Standardization principle- Standardize method, types, size of
material handling equipment.
11. Flexibility principle- Use methods and equipment that can perform a
variety of task and applications.
12. Equipment selection principle - Consider all aspect of material,
move and method to be utilized.
13. Motion principle - Equipment designed to transport material in
motion.
14. Idle time principle - Reduce idle time/unproductive time of both MH
equipment and man power.
 2.10 Material Handling
2.10.6 Principles of material handling
15. Maintenance principle- Plan for preventive maintenance or
scheduled repair of all handling equipment.
16. Obsolescence principle- Replace obsolete handling
methods/equipment when more efficient method/equipment will improve
operation.
17. Capacity principle- Use handling equipment to help achieve its full
capacity.
18. Control principle- Use material handling equipment to improve
production control, inventory control and other handling.
19. Performance principle- Determine efficiency of handling
performance in terms of cost per unit handled which is the primary
criterion.
20. Dead weight principle - The ratio of dead weight (weight of the
material to be handled) to pay load (weight carrying capacity of the
material handling equipment) should be reduced.
 2.10 Material Handling
2.10.7 Selection of material handling equipment
Selection of material handling equipment is an important decision as it
affects both cost and efficiency of handling system. The following
factors are to be taken into account while selecting material handling
equipment.
1. Nature of operations - Selection of equipment also depends on nature
of operations like whether handling is temporary or permanent, whether
the flow is continuous or intermittent and material flow pattern-vertical
or horizontal.
2. Properties of the material - Whether it is solid, liquid or gas, and in
what size, shape and weight it is to be moved, are important
considerations and can already lead to a preliminary elimination from the
range of available equipment under review. Similarly, if a material is
fragile, corrosive or toxic this will imply that certain handling methods
and containers will be preferable to others.
3. Layout and characteristics of the building - Another restricting factor
is the availability of space for handling. If the building is multi-storied,
 2.10 Material Handling
2.10.7 Selection of material handling equipment
chutes or ramps for industrial trucks may be used. Layout will indicate
the type of production operation (continuous, intermittent, fixed position
or group) and can indicate some items of equipment that will be more
suitable than others.
4. Production flow - If the flow is fairly constant between two fixed
positions that are not likely to change, fixed equipment such as
conveyors can be successfully used. If, on the other hand, the flow is not
constant and the direction changes occasionally from one point to
another, because several products are being produced, moving equipment
such as trucks would be preferable.
5. Cost considerations - The above factors can help to narrow the range
of suitable equipment, while costing can help in taking a final decision.
Several cost elements need to be taken into consideration when
comparisons are made between various items of equipment that are all
capable of handling the same load. Initial investment and operating and
maintenance costs are the major cost to be considered. By calculating
 2.10 Material Handling
2.10.7 Selection of material handling equipment
and comparing the total cost for each of the items of equipment under
consideration, a more rational decision can be reached on the most
appropriate choice.
6. Engineering factors - Selection of equipment also depends on
engineering factors like door and ceiling dimensions, floor space, floor
conditions and structural strength.
7. Equipment reliability - Reliability of the equipment and supplier
reputation and the after sale service also plays an important role in
selecting material handling equipments.
2.10.8 Types of material handling equipments
1. Fork lift truck - In fork lift truck, the forks are
attached to a column on the truck. Forks can be
lifted to desired height along with the material on
them and the material can be stacked at the proper
place, even very close to the roof. Fork lift trucks
can be used move materials between various
 2.10 Material Handling
2.10.8 Types of material handling equipments
points and are not permanently fixed in one place. They are, therefore,
most suitable for intermittent production and for handling various sizes
and shapes of material.
2. Cranes - Cranes are employed for lifting and lowering bulky items
and packages or cases. They find in heavy engineering and generally in
intermittent type of production. They provide overhead movements. The
crane hook can move in a rectangular area or a circular area. A jib crane
is preferred where lifting of the jobs is required in few locations only or
where bridge crane cannot be erected.

3. Hoist - Hosting equipment are usually powered equipment used for

lifting and lowering unit and varying loads intermittently. Hoisting
equipment can be stationary, portable or travelling type. Often hoisting
 2.10 Material Handling
2.10.8 Types of material handling equipments
equipment are mounted on powered vehicles like truck, rail
or ship, when the movement of the lifted load is not limited
to a fixed area of operation.
4. Monorail - It is an I section beam attached to the ceiling and having
either a trolley or carrier moving along it. The material can be transferred
from one place to another along the beam. It is employed for intermittent
type of material handling in machine shop and other shops.
5. Conveyors - They are employed to transport
material over a fixed path which may be horizontal or
inclined (up or down), to different locations in the
factory. They prove economical, if the flow of
material is continuous. In a belt conveyor, the belt may be flat or trough
shape to hold (granular) materials which may tend to fall from the flat
belt. The belt material may be rubber covered canvas, steel, plain fabric
or woven wire. A fixed conveyor is used on mass production shop floor
 2.10 Material Handling
2.10.8 Types of material handling equipments
where as portable conveyors are preferred for intermittent job.
Roller conveyors may be gravity aided or powered and
are employed for transporting products having flat
bottoms. Bigger jobs can be handled using roller
conveyors. Small items are put in boxes, before being Roller
transferred. Roller conveyors can move the material conveyors
along straight or curved path. Bucket conveyors consist
of overhead endless chain. It is supported from the ceiling and has a
fixed path to travel. A lifting mechanism is used for loading and
unloading the products. Pipe line conveyors are used for transporting
granular or pulverized materials through the pipes.
6. Slides and chutes - They transfer small jobs which can slide down
under gravity. Vibrating slides transport materials up an incline also.
Chutes have sheet metal base for transporting components down the
incline.
 2.10 Material Handling
2.10.8 Types of material handling equipments
7. Lifts - In multi-storied plants, materials are lifted up and transported
by lifts. It is fast and flexible equipment for floor to floor travel. Buckets
or trays can be mounted on the endless chain running from the ground
floor to the top floor.
8. Tractors and trailers - Tractors, three wheeled or four wheeled
employ IC Engine drive and are generally used for outdoor application.
Material is loaded in the trailers which are attached to the tractor.
 Model university examination questions
Part A One or two sentence answers
1. What are the steps involved in taking a plant location decision?
2. What do you mean by plant location?
3. Explain the objectives of plant layout.
4. Explain the need for selecting a suitable location.
Short answers PART B
1. Discuss the factors influencing plant locations.
2. What are the functions and principles of material handling?
(December-2013)
3. What are the factors to be considered for selecting material handling
equipments? (December-2013)
PART C
1. Explain the valve analysis procedure.
2. What are the general reasons for replacement? What are the factors to
be considered for replacement? (December-2013)
3. Explain any two methods for replacement analysis. (December-2013)