FACILITY LAYOUT Production is the basic activity of all industrial units.

Poduction activity is done in factories which house manufacturing processes. The basic inputs of the production processes are labour, equipment or machines, capital, energy, information & resources. The outputs are products or the services.

Planning a facility:
A facility layout is defined as the design or plan of an operating unit in such a way that it optimizes the production of a good of completion of a service. The aim of a facility layout is to lessen the overhead costs while speeding up the production work. The infrastructure & materials are located in such a way that maximum production is done from available resources.

Types of facility layout:

There are three types of facility layouts: 1. Functional Layout: In this type of layout, all the materials & machines are grouped together according to their function. Eg. Milling machines, here the machines performing similar functions are put together. 2. Line Layout: In this type of layout, equipments are placed in order in which they are used for production. Eg. Food processing units. 3. Fix Position Layout: In this type of layout, the equipments used are kept in a fix position. It happens mostly in case of heavy machinery. Eg. Ship or Aeroplane manufacturing factories.

Fundamental elements of a facility layout:

There are 3 fundamental elements of any facility layout. 1. Type of Production: It determines the type of equipment & machinery which will be used in production thus determining the overall facility layout. 2. Space Available: It will decide the eventual design of the facility. The unit may be multistoried or single storied. It will ensure that there is ample room for all the aspects of production. 3. Exigencies: These are the difficulties or constraints one comes across while implementing a design layout. These may be with respect to space or necessary paperwork. Thus, the facility or layout is designed keeping in mind the economics of producing each product, the quality & reliability of the products & producibility which means the ease & speed with which the output can be generated.

Factors in determining the efficient layout & design:

1. Flexibility: The facility layout should be such that it can be readjusted or modified according to future expansion or changes. 2. Flow of Movement: It should be a smooth flow from input to output so tat the overall coordination is maintained between various units. 3. Utilization of Space: There should be a proper & optimal usage of space to ensure that all the equipment is properly placed & the handling of materials is done is done best in such a space. 4. Ease of Communication: There should be an effective communication between various aspects of business which is conducive to its overall growth. 5. Safety: Occupational safety measures must be in place for optimum production & cutting losses caused due to hazards. 6. Management of Materials: There should be a proper maintenance & upkeep of equipments to ensure that the production is hassle free. 7. Ensuring High Employee Morale: Since this directly affects production, factors like attractiveness of a facility, ventilation, lighting, restrooms & cafeterias have to be provided for maximum employee participation. CAPACITY PLANNING: The capacity of a facility of an industrial unit is planned keeping in mind the current resources and future growth & expansion. The capacity of a facility is its capability to produce an output over a period of time. Measurement of Capacity: The capacity is measured in terms of units of the product per year. Service Capacity: For service industries like hotels, hospitals or airlines, the capacity expression becomes the number of rooms, beds or seats occupied per year. Process of capacity planning: After an analysis of current conditions, future demand is predicted. Since the available capacity is known, the alternative capacity plans for the future is prepared. The economic analysis and feasibility of such plans is then done. This process involves following steps: 1. Future capacity requirement: Capacity plans are dependent upon forecasting demands for outputs. Usually, mature products are subject to better prediction than fresh launches in the introductory phase of its life cycle.

2. Multiple Outputs: There could be many products for which the demand is forecast. All these products may be at various stages of their respective life cycles. Since each product has a different and independent demand, they insure against uncertainties in the market. 3. Stable Demand for Mature products: Products such as textiles, cement, health care, electricity, fertilizers are some examples of products that enjoy a constant and stabilized demand. Cost-Volume relationship: There are two types of costs involved in an industrial unit or facility- fixed cost and variable cost. Break even volume is the volume where there is no profit and no loss. Economics of scale of production: High capacity units have high fixed costs but since variable costs per unit are low, they offer economics of scale. There are other economics of scale too in facilities where there is lesser investment in the input itself. Risk analysis: The predicted demend of a product may not always be correct, the actual demand may be higher or lower than originally predicted. If it is higher, there is under capacity. If it is lower then there is over capacity. Capacity utilization: In a manufacturing concern, a large part of the financial resources are invested in the plant, machines and equipment. The return on the investment can be maximized by making the optimum utilization of the installed equipment. Machine capacity is expressed in terms of machine hours. The time in hours necessary to complete an operation or the job multiplied by total number of jobs that are to be done gives the total capacity of the machine. This is expressed by the formula: ST * MP MC * UC

Where: ST = the number of machines required for the particular operation MP= the maximum production required during the specified time MC= the number of hours that the machine will run UC= average utilization of the machine capacity