Chapter 7 capacity and facilities design. This chapter includes contents: Capacity planning, basic layouts, designing process layouts, designing service layouts, designing product layo | Lecture Operations management: Creating value along the supply chain (Canadian edition) - Chapter 7 OPERATIONS MANAGEMENT: Creating Value Along the Supply Chain, Canadian Edition Robert S. Russell, Bernard W. Taylor III, Ignacio Castillo, Navneet Vidyarthi CHAPTER 7 Capacity and Facilities Design Learning Objectives Discuss long-term capacity planning strategies. Indicate the benefits of effective facility layout. Explain the general characters of process, product, and fixed-position facility layouts. Use block diagramming and relationship diagramming to design process layouts. Describe the general considerations for service layouts. Design a simple product layout for efficiency (balance basic assembly line). Describe three types of hybrid layouts, including cellular layouts, flexible manufacturing systems, and mixed-model assembly lines. 7-2 Lecture Outline Capacity Planning Basic Layouts Designing Process Layouts Designing Service Layouts Designing Product Layouts Hybrid Layouts Copyright 2014 John Wiley & 7-3 Capacity Maximum capability to produce Capacity planning establishes overall level of productive resources for a firm 3 basic strategies for timing of capacity expansion in relation to steady growth in demand Lead Lag average Copyright 2014 John Wiley & 7-4 Capacity Expansion Strategies Copyright 2014 John Wiley & 7-5 Capacity Capacity increase depends on volume and certainty of anticipated demand strategic objectives costs of expansion and operation Best operating level % of capacity use that minimizes unit costs Capacity cushion % of capacity held in reserve for unexpected occurrences Copyright 2014 John Wiley & 7-6 Economies of Scale Unit cost decreases as output volume increases fixed costs can be spread over a larger number of units production or operating costs do not increase linearly with output levels
