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READING OM 4,7 9 (CHAPTER 4 (Importance of
layout decision ((Improved…
READING OM 4,7 9
CHAPTER 4
Facility layout - The process by which the placement of departments , groupwork within departments , workstations and machines within a facility is detrmined
Objective layout
- Provide enough production capacity
- Reducing handling cost
- Utilize labor efficiently
- Reduce accidents
- Provide safety & health
- Provide for volume & product facility
- Allow ease maintenance
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Type of layout
Product Layout
- Part of the manufacturing process which allows for the repetitive assembly of highly standardized products.
- When a manufacturing operation utilized product layout, production work can be layout in a straight line with labor and equipment subdivided in a smooth line.
- Advantages
- Low variable cost/ unit
- Low material handling cots
- Reduce work in process inventories
- Easier training & supervision
- Efficient production flow
- High volume is required
- Work stoppage at any points spoil the operations
- Lack of flexibility in products
Process- oriented layout
- Deals with low volume, high variety products also called job shop layout/ layout by function.
- A design for the floor of a plant that involves arranging equipment & facilities according to their functions.
- Advantages
- Flexibility
- More visual control of activities
- More communication & interaction between peers & supervision
- Higher cost per unit
- Less consistency
- High cost employees
- High skilled.
Fixed position Layout
- Product remains in one place
- workers & equipment come to site
- Complicating factors are limited space at site , different materials needed at different stages, more materials needed
CHAPTER 5
Facility location - a place where a factory, warehouse, office/ any other business enterprise is built
Reason location is important for organizations
- Location affects the fixed cost & variable cost of the organizations
- Location also has an impact on the overall risk & profit
- A new location is neccessary if demand has exceeded the current production capacity
- Changes in labor productivity, exchanges rates, cost/ community attitude
- Shifts in demographics and customer demand.
Factors affecting location decisions
- Proximity to market/ customers - A business that is closer with the customers is important because they can ease their customer to access and help ensure the cus need incorporated into products
- Proximity to suppliers - When located near with the suppliers can reduce the transportation cost & can be efficient in production
- Proximity to competitors - Near with the competitors can easily get the labor, material, infrastructure & information & potential customers.
- Labor supply- Fims require the location that has availability of labor, so they can reduce the training cost and they want skilled labor
- Availability facilities - The telecommunication , transportation is important in order to smooth their production.
CHAPTER 7
Work measurement - It involves determining the time that a qualified worker should take to compete a job under normal working conditions.
Method in setting labor standard
- Historical experience - The data used to establish standard time which based on past data pr historical data from similar job. Example time card/ production record
- Predetermined time & motion studies - To estimate the time for a particular task, the time factor for each elements are added together.
- Work sampling - Determining time spent by employees on various work activities
- Time study - Recording the time required by a worker to complete a task, taking into consideration the necessary allowances &estimating the total time required to do the job.
Type of allowance
- Relaxation allowance -Break time given to employees to relax/ perform their personal needs such as, lunch break, perform prayers and to overcome fatigue
- Contigency allowance - Extra time given to correct minor defects in products or equipment & to collect item such as tools/materials
- Process allowance - Extra time given for non working time that arises from the nature of the process itself for example warming up the machine before production begins.
- Policy allowance - Extra time given to workers because of labor regulations/ trade unions demands. for example, workers who worked extra time should be paid overtime
CHAPTER 9
inventory management is good on hand or
any stock of economic resources that are
idle at a given time, in anticipation of
satisfying a future demand for it.
Type of inventory
- Inventory raw material - Items purchased by firms such as parts, components, and spare parts for machine , tools & other supplies are needed to produce finish products.
- Inventory work in process (wip) - Partially completed items that are currently in production / semi finished products
- Inventory finished goods - Complete products such as clothing canned foods and furniture.
Functions of inventory
- To meet anticipated demand - The demand for finished goods may fluctuate due to the seasonal factors. Thus, firms need to have the goods available to avoid losing sales or customers . Inventory is necessary to cater for uncertainties in demand.
- To smoothen production required - Production may be interrupted due to insufficient stocks, therefore inventory helps in preventing interruptions in production schedules due to late delivery / insufficient materials in stock.
- To protect against stock out - To meet unforeseen circumstances that arises as a result of inconsistent demand and delivery time
- To hedge agaisnt price increase - By buying more & stocking up more when price is low enables the firm to temporarily reduce purchasing cost
- To take advantage of quantity discount - Suppliers usually offer discounts to encourage bulk buying. Firms can reduce the purchasing cost and enjoy better profit margin