1. FACILITY LAYOUT & LOCATION PROF. DR. ORHAN TORKUL M. RAŞİT CESUR

2. Sources of Information for Manufacturing Facilities Design OBJECTIVES; Be able to identify various sources of information for facilities planning Understand the concept of and be able to calculate takt time Be able to define and construct a flat and an indented bill of material Be able to understand the role of management policy in facilities planning

3. Basic Sources of Information Outside the Manufacturing Department Marketing Product design Management policy

4. The Marketing Department The marketing department provides the information of; the selling price, volume (How many can we sell?), seasonality (Is it a summer or winter product?), replacement parts that an older product may require.

5. Sales Strategy Competitiveness: How effevtively an organization meets the wants and needs of customers relative to others that offer similar goods or services. Organization StrategyOperations Strategy Low priceLow cost High qualityHigh performance design or high quality processing Short timeQuick response NewnessInnovation VarietyFlexibility ServiceSuperior customer service LocationConvenience

6. Talkt Time / Plant Rate (R) Talkt Time = Production Time = (Shift Duration – Idle Time) x Utilization Production Rate = units per minute Example: Let us assume that you need to produce and ship 1000 units of product from the plant in an 8-hour shift. Thirty minutes for lunch, 10 minutes for break, and 8 minutes for team meetings are allotted during each shift. Furthermore, let us assume that the plant is operating at 90 percent efficiency. Production Time Production Amounth 1 R

7. Solution of Example Production Time= (8x60 – 30 – 10 – 8) x 0.9 = 389 R = = 0.389 Production Rate = = 2.57 389 1000 1 0.389

8. Scrap & Rework Rate Although undesirable, manufacturing operations do produce scrap or unusable parts. Furthermore, often there is a need to redo an operation simply because the part was not produced within the desired specifications the first time. This is called rework. Scrap and rework result in an inefficient and wasteful use of the facilities’ resources. However, as long as the plant has to deal with scrap and rework, it cannot ignore their demand on production time.

9. Scrap & Rework Rate I= Example: Assume that we have 1000 finished wagon body. Stamping operation has 3 percent scrap. In addition to the stamping operation, two other steps are performed. One step has a 2.5 percent scrap rate and the other produces.5 percent scrap. You can calculate input as follows: I= = 1063 units output ∏ (1 – scrap ) i i = 1 1000 (1 – 0.03) x (1 - 0.025 ) x (1 - 0.005)

10. The Product Design Department The product design department provides; Blueprints The bill of materials Assembly drawings, Model shop samples inform the facilities designer of the prime mission — a detailed description of what needs to be accomplished. The decision to either make or buy a part is up to top management, not just the product engineering department, but the parts list is a good place to indicate that decision.

11. Bill of Materials Bill of materials (BOM) is a logical structure that provides assembly relations between product parts and components. TOP PLATE PVC SKIRT LEG CHIPBOARD COFFEE TABLE

12. Bill of Materials ParentChildAmounthMake or BuyRoute COFFEE TABLE TOP PLATE1 UnitMake Assembly (60 min) LEG4 UnitsBuy SKIRT4 UnitsMake TOP PLATE CHIPBOARD0.64 m 2 Buy Cutting (40 min), Edge Banding (80 min), Drilling (10 min) PVC3.2 mBuy SKIRT CHIPBOARD0.06 m 2 Buy Cutting (10 min), Edge Banding (10 min),Drilling(10 min) PVC0.6 mBuy

13. Product Explosion Product explosion is to calculate the amuonth of materials that is needed for production. To produce 1 coffe table, 1 top plate and 4 legs are needed. To produce 1 leg, 0.64 m 2 chipboard and 3.2 m PVC are needed. To produce 1 leg, 1 wooden bar and 2 screw are needed. We need to produce 4 legs to produce a coffee table, so 4 wooden bars and 8 screws are needed. To produce 4 curtain, 0.24 m 2 chipboard and 2.4 m PVC are needed.

14. Product Explosion ParentChildAmounthMaterial Requirements Route COFFEE TABLE TOP PLATE1 Unit Assembly (60 min) LEG4 Units SKIRT4 Units TOP PLATE CHIPBOARD0.64 m 2 Cutting (40 min), Edge Banding (80 min), Drilling (10 min) PVC3.2 m SKIRT CHIPBOARD0.06 m 2 0.24 m 2 Cutting (10 min), Edge Banding (10 min),Drilling(10 min) PVC2.4 m9.6 m

15. Management Policy Management refers to upper-level employees who are responsible for the financial performance of a company. Such information as; inventory policy and lean thinking, investment policy, startup schedules, make or buy decisions, organizational relationships, and feasibility studies, will all have an effect on the plant facility design.

16. Inventory Policy & Lean Thinking Inventory policy may be Material Requirements Planning (MRP) or Just in Time (JIT). Taiichi Ohno (1912–1990), the identified the first six types of muda: Mistakes that require rectification; any rework is a good indication of muda. Production of inventory that no one wants at this time wastes space and promotes product damage and obsolescence. Useless process steps that can be eliminated without harming the value of the end product is muda. Any movement of people or inventory that does not create value is muda. Idle people waiting for inventory is an indication of a plant that is not in balance. Goods produced for which there is no customer demand is muda.

17. Investment Policy The corporate investment policy is communicated in terms of return on investment (ROI). Return is another way of saying “the savings,” and investment is the cost of implementing the idea to get those savings. If a project saves a large enough percentage of the cost, then it is a good idea. ROI= x 100 Net Profit Initial Investment

18. Investment Policy Internal rate of return (IRR) or econımical rate of return (ERR) is used to measure or compare the profitability of investment. It is calculated by finding out the ratio of interest equalizes total expenditures and total income. Net Present Value = ∑ = 0 N: Total number of periods Cash Flow (1 + return ) n = 0 N n n

19. Make or Buy Decisions Does the company make this part (fabricate from raw materials), or does it buy this part complete from a supplier who specializes in this kind of part? The decision is normally quite straightforward and easy. If you are an existing company with a product line, you know what you can and what you cannot make. If you are a new company, you may buy out all the parts and become an assembly operation only.

20. Online Data Sources http://igeme.com.tr/ http://www.tobb.org.tr/ http://www.tuik.gov.tr/ http://www.sanayi.gov.tr/ http://www.gittigidiyor.com/ http://www.sahibinden.com/ http://www.amazon.com/

21. Online Data Sources http://www.ebay.com/ http://www.alibaba.com/ http://www.oecd.org/ Association web sites

22. THANKS