Project Management Anil Agashe

REASONS FOR SELECTING PLANT LOCATION

Setting up of new operations Expansion of existing plant Additional plants in different regions Change in social, economic, political condition New product / Process developments

FACTORS GOVERNING PLANT SELECTION

Regional factors - Region selection within world/country Community Factors - Plant location within Region Site factors - Site location within the community

PROXIMITY TO MARKET
Fragile product - (Glass) , Perishable product - (Food) Faster deliveries required & Low cost products - (Paper) Pure Materials ( Material where wt. Is added during conversion ) Benefits - low transport cost, faster deliveries, Less administrative market, Better liasoning with Dealers, avoidance of Commissions to middlemen, Better control on A/C receivables

PROXIMITY TO RAW MATERIAL SOURCES

Useful for Gross materials (Material which looses wt. During transformation ) Benefits - Low transport cost for R. M., Less lead time hence low inventory cost and hence space cost, better follow up, easy replacement of rejects and defectives.

INFRASTRUCTURAL FACILITIES Availability of Power( Aluminum, Steel), water(Paper, Cement, Steel, Sugar) disposal of waste (Chemical, Paper, Textiles). TRANSPORT FACILITIES Proper transport facilities ( Rail, Road, Sea, Air), Transport cost, Distance of shipment are important to be considered for site selection. LABOUR & WAGES Availability of labour Wage cost of labours and cost of living. Vicinity to the Training and Educational Institutes. Productivity & skills of labours Industrial relations in the region.

LEGISLATION AND TAXATION

Policies relating to issue of license, construction regulations, labour laws etc. are important to consider. Tax benefits as to Incentives, loans, subsidies, trade agreements become important for site selection.

CLIMATIC CONDITIONS
Certain industries require specific conditions to be maintained Textile - High Humidity) SAFETY REQUIREMENTS Nuclear Power Plants Explosive Factories (

COMMUNITY FACILITIES
This includes Accommodation, educational,entertainment, communication, medical, entertainment and transport facilities.

COMMUNITY ATTITUDE
Towards work, incoming entrepreneurs.

SUPPORTING INDUSTRIES & SERVICES

Maintenance Services, Utility Services, sub-contractors, suppliers of essential parts/materials etc. form backbone of the Industry.

AVAILABILITY OF THE LAND

Plot size ( for production, parking, movement, office, expansion ) Plot cost soil quality for load bearing.

ECONOMIC SURVEY
Prepare list of all relevant factors Estimate expenses on materials, transport, wages, power etc. for each location Collect data on intangibles such as community facilities and attitude. Calculate ROI. Select provisionally a location based on this. Compare the intangible data and select the location considering tangible and intangible data.

OBJECTIVE OF GOOD LAYOUT

Economy in handling of materials Minimizations of production delays Minimum manufacturing cycle time. Efficient utilization of space Easy supervision & better production control. Greater flexibility for product , design & process changes. Better working condition by eliminating causes of excessive noise, objectionable odor, smoke. Better comfort and convenience for handling and operating. Ensure safe working conditions. Minimum wastages and scrap.

PRINCIPLES OF GOOD LAYOUT

Overall integration of factors

men, material, machines, and supporting activities in a way that best compromise is obtained.

Minimum movement & handling

Plant & machinery should be arranged as per sequence of operations in case of product layout. Departments should be arranged as per sequence of operations in case of process layout. As far as possible men and material should be made to move in straight line. A door may be made in a wall or a hole may be drilled in a ceiling if that eliminates or reduces matl. Handling in place of stairs or a distant door. Material to be kept at working height.

PRINCIPLES OF GOOD LAYOUT

Uni- directional flow Materials must flow in straight line or if that is not possible, U- shaped flow, circular flow or zig-zag flow may be adopted for flow in forward direction only.

Effective use of available space

R.M., WIP, F.G., should be piled vertically. Back tracking and duplicated movements should be avoided. Pallets & racks etc. should be used for piling layers one above another. Area below the work tables and in walls should be used effectively.

PRINCIPLES OF GOOD LAYOUT

Maximum visibility
All the men, machines and material should be readily observable at all times. All the departments should be easy to supervise. Every piece of positioning or partitioning should be properly planned. Special cupboards, enclosures, offices, partitions should be avoided.

Maximum Accessibility
All servicing, operating & maintenance points should be readily accessible. Sufficient gap betn. Machines & clearance from walls, pillars for maintenance.

PRINCIPLES OF GOOD LAYOUT

Maximum Flexibility
Future requirements should be taken into consideration while designing for future. Each machine must be self contained in terms of lubrication, cooling lighting and air system. Multipurpose machines give more flexibility than SPMs Process layout is more flexible than product layout. Standardization of tools & equipments give better flexibility.

Maximum security
A good layout is one that safeguards the plant and machinery against fire, theft etc. without employing too many cages, doors, barriers.

PROCESS LAYOUT

Generally associated with batch production. The factory is divided into process units/departments with all similar facilities are grouped together. This layout is suitable when products are non-standard or there is wide variation in the processing time of individual operations.

ADVANTAGES
Lower investment due to less number general purpose machines. Higher utilisation of machines. Greater flexibility in regards to allocation of job and workers. Manufacturing is not disturbed to a large extent due to absenteeism, breakdown or non availability of certain material. Workers skill increases due to repetition of work.

PROCESS LAYOUT
Disruption in one section doesnt disturb working in other section Sequence can be flexible.

DISADVANTAGES
Higher space requirement due to more sections. Material handling is higher and cannot be mechanised due to higher variety. Higher WIP due to queuing due to imbalances. Routing and scheduling is difficult due to different operating sequence. Inspection is required at each stage resulting in delays. Higher set up time and cost.

PRODUCT LAYOUT
Disruption in one section doesnt disturb working in other section Sequence can be flexible. DISADVANTAGES Higher space requirement due to more sections. Material handling is higher and cannot be mechanised due to higher variety. Higher WIP due to queuing due to imbalances. Routing and scheduling is difficult due to different operating sequence. Inspection is required at each stage resulting in delays. Higher set up time and cost.

PRODUCT LAYOUT
The layout is such that material flows sequentially at a steady rate uni directionally. SPMs with built in controls and measuring equipments are employed. The equipments may be duplicated to avoid back tracking. Suitable for standard products required to be produced in large quantities. Demand pattern is fairly stable. Processing times of individual operations are balanced. Uninterrupted supply of material is maintained.

ADVANTAGES
Minimum material handling. Less space required due to less and mechanised material handling. Smaller manufacturing cycle hence less WIP

PRODUCT LAYOUT
Lower labour cost due to higher mechanisation. SQC practices used to control process quality. Better production control due to lesser product variety. Better control on delivery schedules. Easier material planning.

DISADVANTAGES
Product changes result in layout changes. All machines may not be used to their full capacity. Manufacturing cost heavily depends on the volumes. Due to high fixed cost. Breakdown of one machine renders other machines idle. Expansion becomes difficult. Specialised jobs makes it difficult for the workers to find job in other industries.