International Journal of Production Research

ISSN: 0020-7543 (Print) 1366-588X (Online) Journal homepage: https://www.tandfonline.com/loi/tprs20

Combination of Lean value-oriented conception

and facility layout design for even more significant
efficiency improvement and cost reduction

György Kovács

To cite this article: György Kovács (2020): Combination of Lean value-oriented conception
and facility layout design for even more significant efficiency improvement and cost reduction,
International Journal of Production Research, DOI: 10.1080/00207543.2020.1712490

To link to this article: https://doi.org/10.1080/00207543.2020.1712490

Published online: 14 Jan 2020.

Submit your article to this journal

View related articles

View Crossmark data

Full Terms & Conditions of access and use can be found at

https://www.tandfonline.com/action/journalInformation?journalCode=tprs20
International Journal of Production Research, 2020
https://doi.org/10.1080/00207543.2020.1712490

Combination of Lean value-oriented conception and facility layout design for even more
significant efficiency improvement and cost reduction
György Kovács ∗

Institute of Logistics, University of Miskolc, Miskolc, Hungary

(Received 25 June 2019; accepted 2 January 2020)

Global market competition and fluctuating customers’ demands require manufacturing enterprises to focus on cost reduction
and efficiency improvement to increase competitiveness and sustainability. The purpose of the research was the elaboration
of the methodology and procedure of a new combined efficiency improvement method which basically applies Lean methods
and also uses the facility layout design (FLD) method simultaneously, integrating the different advantages of these methods,
which is even more efficient that applying each of the methods individually. The main significant added-value of the study
is the elaboration of a new combined method, which results in even more significant improvement of efficiency and several
KPIs, furthermore, cost reduction, which is confirmed by a real case study for the improvement of a manufacturing plant.
In the case study, the application of 13 Lean methods and the FLD method (which aims at the minimisation of material
workflow, travel distance of materials, material handling cost and space used for assembly) led to the improvement of
10 quantitative and 5 qualitative indicators: productivity; cycle-time; number of workstations and operators; WIP (work-
in-process) inventories; space used for assembly; material workflow; travel distance of materials; material handling cost;
labour cost; component supply; products’ quality; transparency; standardisation; workplace ergonomics.
Keywords: lean process improvement; facility layout design; newly elaborated combined improvement method; cost
reduction; real case study

1. Introduction
Globalisation, market competition, more individual and rapidly changing customers’ demands have resulted in changes in
the production system. In production the resources (raw materials, machines, humans, energy, etc.) are limited; the human
population and consumption are increasing; furthermore, environmental damage is also a global problem. So, current prac-
tices in the use of resources are not sustainable. Therefore, enterprises have to produce cost-effective, energy-efficient and
material-efficient final products, which can be achieved by maximised utilisation of resources. Innovative, environmentally
friendly technologies and efficiency improvement methods are required in order to establish profitability and sustainability
(Dolgui, Guschinsky, and Levin 2009; Kovács 2017; Yu, Cadeaux, and Song 2017; Kot 2018).
The significance of the research topic is that the companies have to focus on productivity and cost reduction; therefore,
the application of efficiency improvement methods is essential and important for companies in order to maintain and increase
their competitiveness and provide sustainable production.
The most often used efficiency improvement methods are the Lean philosophy and the Facility Layout Design (FLD).
The essence of the Lean methods is to focus on the elimination of waste or non-value-added activities to create value-adding
processes, and to realise only value-adding activities in the production system (Alemu, Torgeir, and Petri 2014). Therefore,
in the literature Lean process improvement is called value-oriented or value stream-oriented process improvement (Dennis
2015; Shingo 2017; Erlach 2013). FLD is another most often applied efficiency improvement method which aims at the
optimal arrangement of facilities (departments, workstations, machines, equipment, etc.) on the manufacturing site and the
optimal material flow between these facilities (Heragu 2016; Naik and Kallurkar 2016).
The combined efficiency improvement method applies the elements of the Lean and FLD methods simultaneously, inte-
grating the different advantages of these methods; therefore, it is even more efficient than applying each of the methods
individually. Based on the synthesis of the recent literature it can be concluded, that a uniform and standard methodology or
a procedure for the combined method is not available either in practice or in literature. Therefore, each researcher and indus-
trial expert elaborates and applies their own methodology and procedure differently, combining the elements and advantages
of the Lean and the FLD methods, so the procedures of the combined methods are also different. (The methodology and

*Email: loginno@freemail.hu
© 2020 Informa UK Limited, trading as Taylor & Francis Group
2 G. Kovács

procedure of the combined method mainly depend on the characteristics of the given industrial projects.) Consequently, the
methodologies and procedures relating to the combined methods of each author are unique and can contribute to the recent
state of the research field if they differ from other published methods and procedures and further at the same time lead to
significant process improvement.
The purpose of the research was the elaboration of a new combined efficiency improvement method which basically
apply the Lean value-oriented improvement methods, but use also the FLD method simultaneously in order to result in even
more significant efficiency improvement, cost reduction and improvement of several KPIs. The other aim of the research
was the introduction of a real case study to confirm that the elaborated new combined method can be applied effectively in
practice for the optimal formation of a manufacturing system.
The newly elaborated combined efficiency improvement method results in the utilisation of the different advantages
of the Lean and FLD methods, which is more advantageous compared to the individual application of the two methods
and even more significant efficiency improvement can be achieved. There is no need to execute the Lean and the FLD effi-
ciency improvement procedures separately; instead, we only have to consider, combine and apply the different advantageous
elements of the two methods in the same improvement procedure simultaneously.
There are several significant advantageous differences between the two methods that can be utilised by the application
of the combined method (Section 3.1). Among these differences, the two most important are that:

(1) FLD provides the possibility of the optimal arrangement of the workstations on a manufacturing site; in addition,
the number of workstations can even be reduced by the application of Lean methods.
(2) By the application of the newly elaborated combined method, the total travel distance of materials and the total
material workflow can also be minimised due to the usage of the FLD method, which results in the minimisation of
the material handling cost and minimisation of the space used for assembly. Therefore, these four KPIs can also be
improved by the combined process improvement method.

In the study – besides introducing the methodology, procedure and the practical steps of the newly elaborated method – a real
case study is also described, which confirms that significant improvement in efficiency and cost reduction can be achieved
by the application of the new combined method in a manufacturing plant. The case study shows how the production process
of a real manufacturing system was improved by the application of 13 Lean methods; furthermore – due to applying the
FLD method – the total material workflow, the travel distance of materials, the material handling cost and the space used
for assembly could also be reduced.
The original and the newly improved manufacturing processes and layouts were compared and evaluated in the study.
The results and the significant changes in the process improvement can be seen visually in Figures 4–5, and numerically in
Table 3.
From the case study, it can be concluded, that – due to the new combined method – 10 quantitative indicators (pro-
ductivity; cycle-time; number of workstations and operators; WIP inventory; space used for assembly; material workflow;
travel distance of materials; material handling cost and labour cost of operators) and 5 qualitative indicators (reliability
of continuous component supply of the production lines; processes’ and final products’ quality; processes’ transparency;
process standardisation; workplace ergonomics) were improved.
The main significant added value and novelty of the study is that I elaborated the detailed methodology and the procedure
of a new combined efficiency improvement method, and at the same time the efficiency of the elaborated combined method
is confirmed by a real industrial project. This elaborated combined method – due to the utilisation of the different advantages
of the Lean and FLD methods – results in even more significant efficiency improvement, cost reduction and improvement
of more KPIs in practice during the process improvement.
It can be concluded that – due to the utilisation of the different advantages of the Lean and FLD methods – even more
significant efficiency improvement can be achieved by the application of the newly elaborated combined method during the
improvement of manufacturing processes.

2. Materials and methods

2.1. Methodology of the combined efficiency improvement method
The combined efficiency improvement method applies the elements of the Lean and FLD methods simultaneously, inte-
grating the different advantages of these methods. A great deal of most relevant and state of the art articles was evaluated
relating to the research topic, which provided the theoretical background of this study. Based on the synthesis of the recent
literature it can be concluded that a lot of relevant publications are available in the topics of characteristics, methodology,
procedure, application fields and cost analysis of both Lean (Chay et al. 2015; Yadav et al. 2017; Pearce, Pons, and Neitzert
 International Journal of Production Research 3

2018; Oliveira, Sousa, and Campos 2019; Braglia et al. 2019; Tortorella et al. 2019) and FLD methods (Pourvaziri and
Pierreval 2017; Anjos and Vieira 2017; Hosseini-Nasab et al. 2018) individually.
Several recent articles put great emphasis on the relations of different efficiency improvement methods and production
philosophies. So, few studies discuss the relation of Industry 4.0 conception and Lean production philosophy, i.e. Kamble
et al. analysed the effects of Industry 4.0 technologies on Lean manufacturing practices (Kamble, Gunasekaran, and Dhone
2019). There are also available some publications in topic of possibility of simultaneous application of Lean and Simulation
efficiency improvement methods (Uriarte, Amos, and Moris 2020).
There are some studies in which the elements and advantages of Lean and FLD methods are partially discussed, mainly
in relation with Lean philosophy (Bai, Satir, and Sarkis 2019; Shang and Sui 2014; Orr and Orr 2014; Chiarini, Found, and
Rich 2016). Furthermore, it can be found also few articles which discuss basically the FLD method, but partially mention
the cellular design method – as a Lean tool – and its advantages (Tubaileh and Siam 2017; Chen and Tiong 2019). But
in these publications, only the importance of the formation of the adequate layout is emphasised, and the general layout
configurations are described as single-row layout (linear, U-shaped, semicircular, serpentine); double row layout; multi-row
layout; cluster layout and loop layout. But in these articles, the procedure and methodology of the combined method are not
included.
Consequently, it can be concluded that there is a gap in the literature in the field of combined efficiency improvement
methods which integrate the elements and advantages of Lean and FLD methods simultaneously. In the existing literature,
there are no articles which focus on a combined method and discuss it in any depth. Therefore, there is a lack of studies
on the complex methodology and procedure of the combined methods as well as a lack of real case studies for process
improvement through the combined method.
Although Lean and FLD methods are often used in practice during the process improvement of industrial projects,
generally complex, theoretical and scientific methodologies and procedures are not elaborated based on the results of these
industrial projects, so no articles have been published in the topic of the combined method. The aims of industrial experts
are to achieve even more effective results during a real industrial improvement projects, but at the same time is not aim to
separate theoretically and methodologically the Lean and FLD methods. The opinion of some industrial experts is that in
practice the Lean and FLD methods are so closely related, that they are not really treated separately (Chiarini, Found, and
Rich 2016). On the contrary, a detailed and complex elaboration of the methodology and procedure of the combined method
is required in terms of science.
It can be summarised, that there are not enough recent publications available in the field of the combined efficiency
improvement method; therefore, a more detailed literature review cannot be presented in this topic.
Furthermore, it can be concluded, that a uniform and standard methodology or a procedure for the combined method
is not available either in practice or in literature. Therefore, each researcher and industrial expert elaborates and applies
their own methodology and procedure differently, combining the elements and advantages of the Lean and the FLD
methods.
Based on the above-mentioned facts – in my opinion – the main added-value of my study is that in my article I describe
the detailed methodology and procedure of the combined method that I elaborated, and at the same time a practical appli-
cation of this newly elaborated method is also introduced in the framework of a real industrial project, which confirms the
efficiency of the elaborated combined method.
The newly elaborated combined method applies the elements of both the Lean and FLD methods; therefore, the
methodology and procedure of these methods are introduced according to the relevant literature in the next sub-sections.

2.2. Methodology of the Lean value-oriented process improvement

Lean manufacturing is a performance-based, value-oriented process improvement. The main goal of the Lean manufacturing
philosophy is the continuous improvement of the production processes to focus on the elimination of wastes or non-value-
added activities, to create value-adding activities, and to carry out only value-adding activities from the customer’s point of
view throughout the whole production system, which is targeting lead-time and cost minimisation.
Lean manufacturing and Lean enterprises mean that companies are focused on supplying what the customers want, in
the form at the exact time they want, free from defects, with minimised waste in the process (Chiarini 2013; Oliveira, Sousa,
and Campos 2019).

2.2.1. Types of activities of the Lean process improvement

(1) Types of Lean activities from value stream aspect are the following:
• value-added activities (welding, assembling, etc.),
4 G. Kovács

• required but non-value-added activities (material handling, exchange of dies, etc.),

• wastes – activities that do not create value (over-production, warehousing, etc.).
(2) Seven types of Lean wastes can be categorised:
Over-production; Waiting; Unnecessary motion; Transportation of goods; Inventories; Over-processing; Producing
defective products; Other additional wastes (underutilised employee creativity, application of non-adequate machines and
processes, etc.). Those enterprises which identify and minimise the wastes can increase their competitiveness (Chay et al.
2015; Yadav et al. 2017).

2.2.2. Five principles of a Lean process improvement

The principles and its main tools are the following (Zhou 2016):
(1) Value: Determine value from the perspective of the customer which the customer is willing to pay for.
(2) The Value Stream: Identify all the steps in the value stream required to eliminate the non-value-added activities,
from design concept to customer usage (Braglia, Frosolini, and Gallo 2017).
• Main tools: (1) Identification of wastes; (2) 5 Why; (3) Value Stream Mapping.
(3) Flow: Make the value-creating steps, eliminate all process stoppages to make the perfect value stream ‘flow’ without
interruptions (Braglia, Frosolini, and Gallo 2017; García-Alcaraz and Maldonado-Macías 2016).
• Main tools: Just in Time (JIT); One-piece flow; Takt-time design; Heijunka; SMED; Jidoka.
(4) Pull: Ensuring the downstream process is only getting exactly what the customers want when they want it.
Customers pull value from the next upstream activity (Beemsterboer, Land, and Teunter 2017).
• Main tools: Pull system; Kanban; Supermarket.
• Perfection: Identify possible areas of improvement and implements changes, forming the most efficient
processes (Nallusamy and Saravanan 2016; Pearce, Pons, and Neitzert 2018).
• Main tools: Standardisation; Kaizen; 5S (Figure 1).
There are several further common used tools of Lean manufacturing which are the following: Cellular layout; Productive
Maintenance; 6σ ; Zero defects; Workplace ergonomics; Error proofing; Line balance; A3, etc. (Peetu, Koshy, and Biju 2013;
Huawei et al. 2016; Tortorella, Vergara, and Ferreira 2017).

Figure 1. Five principles of Lean manufacturing. Source: (Sigma Savvy 2019).

 International Journal of Production Research 5

Recently this conception is used in many sectors, e.g. automotive, electronical and white goods, administration,
hospitals, education, etc. (Tubaileh and Siam 2017; Yildirim, Oflaç, and Yurt 2018; Pearce, Pons, and Neitzert 2018).

2.3. Methodology of the facility layout design

The essence of the FLD is the optimal location of objects (facilities, which can be department, workstation, machine, etc.) on
the manufacturing site and the optimal material flow between these facilities. The main purpose of the FLD is to minimise
total workflow, therefore improve productivity, reduce total distance of goods flow in the shop floor, improve the flow
of goods and operators between machines, minimise material handling costs and total lead time in the production system
(Vitayasak and Pongcharoen 2015; Riyad, Kamruzzaman, and Subrata 2014; Ojaghi et al. 2015; Pourvaziri and Pierreval
2017; Hosseini-Nasab et al. 2018).

2.3.1. Optimisation procedure of the facility layout design process improvement

The FLD is an optimisation procedure, a non-overlapping planar orthogonal arrangement of n rectangular workstations has
to be achieved on a rectangular (Lx × Ly ) manufacturing site. During the optimisation process, all of the possible variations
of facility layouts have to be formed taking into consideration the design constraints. The number of alternatives is huge
or infinite, therefore the formation and the evaluation of all of possible alternatives is impossible. Consequently, the global
optimal solution is very difficult or impossible to define according to the opinion of the most of the researchers (Anjos and
Vieira 2017). The result of the FLD is an ideal layout, which will be defined by the selected objective function.

(1) Objective function

At first the objective function of the FLD has to be defined, which can be the minimisation of the total material workflow or
the minimisation of the material handling costs.
Material workflow (EMWF ) is a widely used objective function for the description of the amount of workflow that should
be minimised. Material workflow can be calculated:


n 
n
EMWF = qij lij (1)
i=1 j=1

where qij is the material flow between the workstations (UL – unit load which can be a box, pallet, etc.); lij is the distance
between the workstations on the shop floor (m); n is the number of workstations on the shop floor.
Matrix of material flow:

1 ... j ... n
1 ⎡ ⎤
..
. ⎢ ⎥
Q= ⎢ ⎥
i ⎢ qij ⎥
⎢ ⎥
.. ⎣ ⎦
.
n

• qij : material flow from workstation i to workstation j per shift (UL)

Matrix of distances:

1 ... j ... n
1 ⎡ ⎤
..
. ⎢ ⎥
L= ⎢ ⎥
i ⎢ lij ⎥
⎢ ⎥
.. ⎣ ⎦
.
n

• lij : the distance between the individual workstations on the shop floor (m).
6 G. Kovács

(2) Design constraints

Most important design constraints are the following: space requirements of the objects to be located, architectural charac-
teristics of the building, basement of machines and workstations (fixed or moveable), logical relations of the objects (orders
of workstations), noise and vibration of machines, relation with the internal and external material flow ways, etc. (Keller
and Buscher 2015).

3. Newly elaborated combined efficiency improvement method – combination of Lean and facility layout design
methods
The main significant added value of the research is that I elaborated a new combined method, which – due to the utilisation of
the different advantages of the Lean and FLD methods – results in even more significant efficiency improvement, operational
cost reduction and improvement of more KPIs can be achieved.

3.1. Methodology and advantages of the newly elaborated combined method

The new combined method results in the utilisation of the different advantages of the Lean and FLD methods, which is
more advantageous compared to the individual application of the two methods. There is no need to execute the Lean and
the FLD efficiency improvement procedures separately; instead, we only have to consider, combine and apply the different
advantageous elements of the two methods in the same improvement procedure simultaneously.
The main important advantageous differences between the two methods which can be utilised in the combined method
are the following:
(1) Lean methods are easy to use due to their simplicity. Lean philosophy uses excellent visualisation techniques, which
support the transparency and improvement of the processes. On the contrary, FLD is a fundamental optimisation
task which requires mathematical optimisation, which is often computationally intensive.
(2) Application of Lean philosophy requires only the knowledge of Lean methods, high level mathematical and IT
expertise is not needed. Lean methods require relatively little time effort. On the contrary, the FLD method requires
high level mathematical and IT expertise and competences and it is often time-consuming.
(3) FLD method cannot provide the possibility of the reduction of the number of facilities (e.g. workstations); on the
contrary the number of facilities can be reduced by the application of Lean methods.
(4) Due to the application of the FLD method, the total travel distance of materials and the total material workflow
can be minimised in all of process improvement projects, which at the same time results in the minimisation of
the material handling cost and minimisation of the space used for assembly. On the contrary, all of them before
mentioned 4 KPIs cannot be improved by the individual application of Lean methods.
(5) Due to the application of the Lean methods not only the quantitative indicators but at the same time the qualitative
indicators can also be improved. On the contrary FLD method mainly results the improvement of quantitative indi-
cators (reduction of travel distances of goods, reduction of material workflow and reduction of materials handling
cost).

3.2. General procedure and main practical steps of the combined efficiency improvement method
The main practical steps of the general procedure of the new combined method are the following:
(1) Determining the objectives of the improvement project, identifying the general problems with the management.
First, the most important design aims (KPIs) have to be defined: those that should be measured at the beginning of the
project and those which have to be improved by the end of the improvement project.
(2) Choosing the focus area – the most important product, product family, process or customer to be examined.
Pareto analysis has to be applied by the following possible criteria: final products’ volume; final products’ sales value; costs;
strategical customer; etc.
Based on the results of the Pareto analysis one final product or one process has to be chosen for in-depth analysis.
(3) Mapping the current state of the pilot improvement process – drawing the Current State Map (CSM).
CSM helps to represent where wastes occur in the process and to visualise the information flow and material flow, to
make the wastes visible, shows the relation between information flow and product flow, and defines the Lean improvement
actions.
 International Journal of Production Research 7

(4) Evaluating the current state of the pilot improvement process.

From an in-depth analysis of the CSM wastes and bottlenecks can be identified in the investigated process. The number of
facilities (e.g. workstations) has to be reduced – if it is possible – by the application of the Lean methods (Takt-time analysis
and Line Balancing methods).
(5) Defining the objective function of the FLD.
At first, the objective function of the FLD has to be defined, which can be the minimisation of the total material workflow
or the minimisation of the material handling costs. But the material workflow is the most often used objective function,
because the material workflow is linearly proportional to the material handling costs.
(6) Defining the design constraints of the production process relating to the given improvement project. The number of
design constraint is huge; the most common used constraints are listed in Section 2.3.1.
(7) Forming alternative layouts.
Alternative layouts have to be created consider design constraints and limitations.
(8) The huge number of alternative layouts has to be reduced.
The number of possible alternatives is huge or infinite, therefore, the number of alternative layouts has to be reduced consider
the design constraints and limitations; furthermore, Lean methods applied during the process improvement (Cellular design,
Supermarket, Kanban, etc.).
(9) Selecting the ideal, most effective layout.
The reduced, smaller number of layout alternatives have to be compared and the ideal layout has to be selected based on the
objective function by the systematic search method.
(10) Mapping the future state of the pilot process – drawing the Future State Map (FSM).
Short and long-term improvement actions and recommendations have to be defined and the targeted goals (KPIs) have to
be quantified.
(11) Establishing the project team and training the key persons.
Key persons (managers, operators) for the project team have to be selected and the improvement project has to be scheduled.
Lean training teaches the essence and techniques of Lean manufacturing.
(12) Pilot implementation – running the pilot project on the investigated focus area.
Improvement suggestions and changes must be achieved. Results of the improvement project have to be measured by the
improvement of KPIs defined in Steps 1, 5.
(13) Full implementation – Elaboration of a complex improvement programme.
Based on the experience gained during the pilot project a complex improvement programme (including further processes,
production areas, etc.) has to be defined. The goals, the directions and areas of investigation have to be identified.

3.3. Main contributions of the newly elaborated combined method to the industrial application
The newly elaborated combined efficiency improvement method results in the utilisation of the different elements and
advantages of the Lean and FLD methods, which is more advantageous and provides even more significant efficiency
improvement in industrial projects compared to the individual application of the two methods. The combined method results
in even more significant operational cost reduction and improvement of more KPIs, that applying each of the Lean and FLD
methods individually. We only have to combine and apply the different advantageous elements of the two methods in the
same improvement procedure simultaneously.
The newly elaborated combined method utilises the several significant advantageous differences of the Lean and FLD
methods, which provides the main contributions of the application of the combined method to the industrial application.
These main contributions are the following:
(1) The aims of both methods are taken into consideration in the new combined method: on the one hand to focus on
the elimination of waste or non-value-added activities, on the other hand, to achieve the optimal arrangement of
facilities and optimal material flow on the shop floor.
8 G. Kovács

(2) FLD provides the possibility of defining the optimal arrangement of the workstations on a manufacturing site; in
addition, the number of workstations can even be also reduced by the application of Lean methods (Takt-Time
Analysis and Line Balancing methods).
(3) By the application of the combined method – due to the usage of the FLD method – the total travel distance of
materials and total material workflow can also be minimised, leading to the minimisation of the material handling
cost and minimisation of the space used for assembly. Therefore, these four KPIs can also be improved by the
combined method.
(4) In the elaborated combined method – due to the application of the Lean methods – not only the quantitative indi-
cators, but at the same time the qualitative indicators (e.g. quality of the processes and final products, workplace
ergonomics, etc.) can also be improved.
(5) In the new combined method by the application of Lean methods (e.g. Cellular design, Supermarket, Kanban
methods, etc.) the huge number of possible layout alternatives can also be reduced.

3.4. Application of the combined efficiency improvement method in industrial environment

(1) Reasons of the process improvement

• The layout of the manufacturing plant has to be adjusted from time to time to fit changing production plans
and processes (e.g. the company has to produce a new type or higher volume of final products, etc.).
• Modernisation of the manufacturing activity: new technologies have to be implemented, which require new
facilities (e.g. machines, workstations, etc.).
• Productivity and competitiveness of the company have to be increased (e.g. higher utilisation of machines,
humans, etc.).
• Sustainability requirements have to be fulfilled (e.g. application of environmentally friendly and sustainable
technologies, etc.).

(2) Suggested application of the combined efficiency improvement method

• The aim of the process improvement is not only to achieve the optimal arrangement of facilities, but at the
same time also to reduce the number of workstations.
• Free space has to be provided on the shop floor for new value-adding activities (establishment of new
processes, e.g. packaging, etc.).
• In those manufacturing plants, where most of the workstations can be arbitrarily moveable on the shop floor,
because the cost and time of the rearrangement of the machines located in fixed position are very high.
• In those manufacturing process improvement projects which require the application of the combined
method, because the individual application of the Lean or FLD method is not effective enough. The com-
bined method integrates the different advantages of these two methods, which results even more significant
efficiency improvement, cost reduction and improvement of more KPIs, that applying each of the methods
individually (e.g. the number of the workstations cannot be reduced by the individual application of the
FLD method.)

(3) Results of the application of the combined efficiency improvement method

The application of the combined method leads to significant positive results, i.e. improvement of several KPIs. On the
one hand – due to the FLD method – the reduction of the total travel distance of materials, reduction of the total material
workflow and reduction of the material handling cost can be achieved. On the other hand – due to the Lean methods –
the following KPIs can be improved: e.g. lead time, productivity, number of workstations and operators, labour cost, WIP
inventory and several quality indicators (e.g. products’ quality, ergonomic workplace), etc.
The application of the combined method is not more expensive compared to the individual application of the Lean or
FLD method (e.g. one of the most expensive activity is the rearrangement of workstations located in a fixed position, but
this activity is often used also in the FLD process improvement).
Of course a more complex process improvement requires higher investment cost. Based on the benefit-loss analysis
the total cost of the full implementation of the project and the payback period of the investment can be defined. Based
on this information the management makes the final decision relating to the detailed elaborated plan of the full process
improvement, which includes the budget, steps and scheduling of the process improvement project.
 International Journal of Production Research 9

(4) Role of the company’s management in the process improvement project

The company’s management has a key role in the process improvement project. At first, the general problems of the produc-
tion processes have to be identified, then the main design aims, design constraints and limitations of the process improvement
have to be defined according to the demands of the management. The management makes the final decision relating to the
detailed elaborated plan of the full process improvement, which includes the budget, steps and scheduling of the process
improvement project. During the full implementation of the improvement project the management continuously collaborates
and makes collective decisions with the designers. The aims of the management are to achieve even more significant, time-
and cost-effective results during the improvement project, but at the same time the method of the process improvement
(Lean or FLD or combined methods, etc.) is not important for the management.

4. Discussion – process improvement of a manufacturing plant by the application of the newly elaborated
combined method, case study
In this section, the process improvement of a manufacturing plant is introduced by the application of the new combined
efficiency improvement method. The procedure of the process improvement was achieved by the main steps of Section 3.2.
During the complex process improvement 13 Lean methods were applied, which are the following: Value Stream Mapping;
Takt-Time Analysis; Line Balancing; Cellular design; 5S; Workplace ergonomics; Pull; JIT; Kanban; Supermarket; One-
piece flow; Visual management; Standardisation. Furthermore, the FLD method was also used, which resulted the reduction
of the total material workflow, the travel distance of materials, the material handling cost and the space used for assembly
(Section 4.2.).
The goal was to achieve significant results in the process improvement by the simultaneous application of more and
more Lean tools and FLD method. After it the original and the newly improved manufacturing processes and layouts were
compared and evaluated. The results of the process improvement can be seen visually in Figures 4 and 5, numerically in
Table 3.

4.1. Problem formulation

The investigated production company carries out the assembling of automotive components. The original layout of the
manufacturing plant to be improved can be seen in Figure 2. The total manufacturing process includes 14 workstations.
Workstations 1, 5 and 6 of the original layout are located in a fixed position, but all of the other workstations were arbitrarily
moveable on the shop floor. The material flow between the different workstations are depicted by red arrows in Figure 2.
The quantity of the material flow is given in unit loads (UL).

Figure 2. Original layout of the manufacturing plant.

10 G. Kovács

Goals of the process improvement are the following:

• to increase productivity by reducing total lead time,
• to increase the utilisation of machine and human resources by reducing the number of workstations and operators,
• to reduce the movement of goods and operators on the shop floor,
• to reduce operation costs focusing on material handling costs and labour costs,
• to save space on the shop floor for other value-adding activities,
• to establish an ergonomic and safe workplace.

4.2. Process improvement by application of the new combined method

4.2.1. Value stream mapping method
In the improvement project, the Current State Map (CSM) was prepared and the types and places of wastes were identified.
In-depth analysis of the CSM provided the possibility of determining the improvement areas and suggestions for future
improvements. These improvements were the basis for the creation of the Future State Map and for planning the performance
and efficiency improvements.

4.2.2. Takt-time analysis method

Takt-time analysis method means the analysis of takt-time compared to the cycle times of the manufacturing activities.
Takt-time is the maximum amount of time interval in which a finished product needs to be produced to ensure continuous
flow in the manufacturing process, utilisation of resources (machine, human, etc.) and to satisfy customers’ demands. Cycle
time is the average time of the manufacturing activities at the individual workstations.
• The original cycle times of the individual workstations can be seen in Table 1.
• Takt-time can be formulated by

TA min
Ttakt = (2)
Q unit
where TA is the total available working time in a shift (min); Q is the average number of final products that customers require
per shift (unit).
The total available working time is the total real manufacturing time (8 h/shift) including break times (0.5 h/shift). The
available working time in a shift is 450 min/shift.
In our case study, the customer’s demand is 80 units/shift of final products. Based on Equation (2) the calculated takt-time
is 5.62 min/unit.
• The takt-time and the cycle times (Table 1) of the individual workstations have to be compared (Figure 3).

Table 1. Original cycle times at the individual workstations.

Workstations 1 2 3 4 5 6 7 8 9 10 11 12 13 14 1–14
Original cycle times (min) 4.6 3.9 3.4 3.5 5.1 4.7 3.2 3.4 6.1 3.4 5.2 4.1 5.1 5.0 60.7

Figure 3. Comparison of takt-time and cycle times of the workstations.

 International Journal of Production Research 11

Cycle times of the individual workstations have to be below the takt-time, otherwise the expected number of final
products required by the customers is not fulfilled. If the cycle time is longer than the takt-time, there will be a bottleneck
in a manufacturing process. The processes that take less time than the takt-time are also problematic, because they result in
unutilised resources (machine, human, etc.).
Figure 3 shows that the activity at workstation 9 is a critical bottleneck because if it takes much longer than takt-time, it
interrupts the continuous value stream and leads to a higher amount of WIP. Shorter cycle times of workstations 3, 4, 7, 8
and 10 result in unutilised resources which can also be improved.

4.2.3. Line balancing method

The next step is levelling the workload in the whole value stream by removing overloaded and unloaded processes. This can
be achieved by relocating (balancing) the workload from one workstation/operator to an adjacent upstream or downstream
workstation/operator in order to minimise the idle times of the operators and machines, thus resulting in higher utilisation
of resources.
• The ideal number of operators and workstations can be calculated by the following equation:

TT
NOp,Ws = (3)
Ttakt

where TT is the sum of the cycle times of all of the individual workstations, means the total time consumption to produce
one final product (min).
In our case study, the total time consumption is 60.7 min, so the ideal theoretical number of the operators and worksta-
tions is 10.8 pieces based on Equation (3). Unfortunately, in practice, the relocation of the workloads is not possible in case
of all of workstations or operations. In the investigated manufacturing process, only the reorganisation of the workloads of
workstations 2–4 and workstations 7–10 was possible.
In the original manufacturing process, the workstation 9 was the bottleneck (bold value in Table 2).
After balancing workstation 4 was eliminated by reallocating its task to workstations 2 and 3. Workstation 7 was also
eliminated by reallocating its task to workstations 8, the subprocesses of workstation 8 was allocated to workstation 9.
Subprocesses of workstation 9 was reallocated to workstation 10. Due to the reconfiguration of the cycle time of workstation
9 also was reduced, so this earlier bottleneck was eliminated. The results of the Line balance can be seen in Table 2 and in
Figure 4.
It can be concluded that the total workload of the total manufacturing process was achieved in the original state by
14 workstations and 14 operators, while after Line balancing (after reallocating the workloads) it could be carried out by
12 workstations and 12 operators. The balanced process provides higher utilisation of both the workstations and human
resources.

Table 2. Comparison of the original cycle times and the newly balanced cycle times.
Workstations 1 2 3 4 5 6 7 8 9 10 11 12 13 14 1–14
Original cycle times (before) (min) 4.6 3.9 3.4 3.5 5.1 4.7 3.2 3.4 6.1 3.4 5.2 4.1 5.1 5.0 60.7
Newly balanced cycle times (after) (min) 4.6 5.4 5.4 0 5.1 4.7 0 5.4 5.4 5.3 5.2 4.1 5.1 5.0 60.7

Figure 4. Comparison of the original cycle times and the newly balanced cycle times.
12 G. Kovács

4.2.4. Cellular design method

In the case study originally the traditional process layout was formed. During the Lean value-oriented layout planning a
U-shaped cellular layout was created. Workstations 1, 5 and 6 of the original layout are located in a fixed position, but all of
the other workstations were arbitrarily moveable on the shop floor. Therefore, the linear layout configuration (workstations
7–14 on the original layout) was organised into a U-shaped cell (workstations 6–12 on the newly improved layout). The
newly improved balanced layout can be seen in Figure 5.
The advantages of the new U-shaped cell are the following: Saved space on the shop floor for other value-adding activi-
ties. Increased productivity. Reduced lead times and set-up times. Provided fast and continuous flow of goods (raw material;
semi-finished, finished products). Reduced WIP inventories. Reduced material flow distances and workers’ movements.

4.2.5. Pull method, just in time method, Kanban method and supermarket method
In the case study the Pull Method, the Just In Time Method, the Kanban Method and the Supermarket Method were also
implemented simultaneously. Since these methods have logical, thematic and causal relations, they are discussed in this
sub-section together.
Pull based production starts only after receiving a specific customer’s demands. Therefore, Pull philosophy produces
only the necessary amount of final products according to real customers’ demands. The company produces exactly what
the customers want, in the form and at the exact time they want it, free of defects. The Lean philosophy is based on Pull
production philosophy; this is the reason why the Pull method is also an important Lean tool.
JIT is a production and inventory strategy. Applying JIT leads to improvement in the return on investment of the
company by reducing WIP inventory and lead times and improving efficiency. The JIT manufacturing system supports
the operation of the Pull principle; each manufacturing process produces only what the next process in the sequence is
calling for (pull). In our case study, the JIT principle was established by the implementation of the Kanban system.
The Kanban method is a special visualised form of the JIT conception. The manufacturing process is driven by signals
which are the Kanban cards, that inform the production processes about the demands of the next process. The cards indi-
cate the standard quantity of production, maintain the Pull production principle, and visualise the workflow. The aim of
the Kanban technique is to establish a Pull type production and inventory strategy and to eliminate labour and inventory
wastes through the production process and to thus achieve better performance. In our project the Kanban technique was
implemented, the component supply of the production lines was scheduled and achieved by a milk-run train in the plant.
The milk-run stops were removed and located according to the newly improved value-stream-oriented layout (Figure 5).

Figure 5. Newly improved layout of the manufacturing plant.

 International Journal of Production Research 13

The application of Supermarkets reduces component shortages at the production line, reduces inventory of components
in the plant, and means faster delivery of the components to the production line. In the supermarket the frequently used
materials (those that turn faster than the average materials) are stored close to the production line. When the components
are removed from the supermarket, a signal (like a Kanban card) is taken by the material handler to retrieve the missing
components. In our improvement project, two supermarkets were located on the shop floor close to the supplying process
(Figure 5).

4.2.6. One-piece flow method

Achieving one-piece flow supports the true JIT principle. One-piece flow means that the components or semi-finished
products move through the manufacturing processes step-by-step without interruption. It results in zero or minimal WIP
between the processes. In the case study, the formation of the cellular layout provides the achievement of the perfect one-
piece flow. The implementation of a one-piece flow production process reduces defects and WIP inventories, increases the
flexibility of the production line, and makes the wastes visible.

4.2.7. 5s method, visual management method and workplace ergonomics method

In the case study the 5S Method, the Visual Management Method and the Workplace Ergonomics Method were also
implemented simultaneously. Since these methods have logical, thematic and causal relations, they are discussed in this
sub-section together.
During the design of the newly improved cellular layout, the 5S method was also implemented. This is a simple but
effective method to organise, standardise, and sustain an efficient workplace. 5S means the following actions during the
organisation of the workplaces: Sort, Straighten, Shine, Standardise and Sustain (Shang and Sui 2014).
In the case study, these five actions describe how to make a workplace more efficient by identifying and storing the most
frequently used items, maintaining the area and items, and sustaining the new standardised order. Implementation of this
process creates and maintains a well-organised, safe, clean and efficient workplace.
In the case study in the framework of 5S better cleaning and visual methods (communication boards, Andon signals and
floor painting) were implemented.
Visual management is the hallmark of a Lean process improvement. Visual management displays the most important
information flowing between Lean management and employees by the application of boards, posters, signals, pictograms,
floor paintings, etc. In the case study information boards were located on the walls, e.g. display, tracking, and communication
boards. Andon signals were implemented at the workstations and Andon boards in the production cell. Floor paintings were
also used for communication. Floor paintings of the path of Kanban circles and application of Kanban cards were applied in
order to improve the efficiency of the operation of the Kanban system. The documentation of the standardised work is also
a visual management tool which was also applied.
During the design of the newly improved cellular layout the aspects of workplace ergonomics were also taken into
consideration. Workplace ergonomics provides physical and emotional health (noise, hazardous materials, vibration, etc.)
and safety (facilities, tools, and materials on the shop floor according to compliance with safety-at-work rules and envi-
ronmental regulations) for the workers. The justification behind this method is that a well-organised ergonomic workplace
results in elimination of risk of injury and bad morale of workers and productivity improvement. In the framework of
ergonomics simple automation of some sub-processes, ergonomic devices and tools and comfortable seats for the operators
were implemented.

4.2.8. Standardisation method

Standardisation is the documentation of the currently best-known method for any kind of procedure or practice. It is one of
the most important methods for continuous improvement and a reasonable workplace for the operators.
In our case study, the final step was the creation of standardised work (documented by process capacity sheets,
standardised work combination tables, and standardised work charts) for all of the individual workstations and operators.

4.3. Facility layout design method

In the FLD procedure, the number of alternatives is huge or infinite, therefore the formation and the evaluation of all of
possible alternatives is impossible. Consequently, the global optimal solution is very difficult or impossible to define.
14 G. Kovács

Since the number of possible alternative layouts is huge, the number of possible alternatives had to be reduced tak-
ing into consideration (1) design aims, (2) design constraints and limitations, (3) management’s demands, (4) practical
applicability and (5) designer experience. Finally, the ideal layout (best solution) had to be selected based on the objective
function.

4.3.1. Procedure of facility layout design in the case study

In the case study, the ideal layout was selected also based on the general FLD optimisation procedure, introduced in Section
3.2.
The main practical steps of the FLD procedure in the case study (forming possible alternative layouts and then selecting
the ideal layout) were the following:
(1) Design aims:
At first the main design aims of the process improvement had to be defined according to the demands of the company’s
management. In the case study the most important design aims were the following:
• Management required that the full implementation of the process improvement (project) had to be achieved without
production line stoppage (or with minimal downtime) in order to provide continuous production. Therefore, one of
the most important design goals was the time minimisation of the total process improvement project, because line
stoppage results in loss of income and in waste.
• The other aim of the process improvement – according to the management’s demand – was to save space on
the shop floor for other value-adding activities, i.e. establishment of new workstations (possibility to increase
production capacity). Therefore, the workstations had to be rearranged so that a larger (56 m2 ) open area would be
available on the shop floor.
• The cost and time minimisation of the rearrangement of the workstations (relayout) was also an important design
goal. Therefore, workstations 1, 5 and 6 were not rearranged, because these are monument type (fixed) objects and
the rearrangement would significantly increase the costs and cause loss of production, which would result in loss
of income.
• It was an important design aim that – after the relayout – the operation costs could be reduced, focusing mainly on
material handling costs and labour costs. As the result of the process improvement the material handling costs were
reduced due to the reduction of transport distances. The number of the workstations and operators was reduced by
2, which reduced labour costs and at the same time increased the utilisation of machine and human resources.
• Further general aims were the following: to increase productivity by eliminating the bottlenecks and reducing total
lead time; to reduce the movement of goods and operators on the shop floor; and to establish an ergonomic and
safe workplace.
(2) Objective function:
Then in the case study the objective function had to be selected in the FLD procedure, which was the minimisation of the
total material workflow. Reduction of total material workflow also resulted in the reduction of the material handling costs.
(3) Design constraints and limitations:
After it the design constraints and limitations had to be taken into consideration. In the case study the most important
design constraints were the following: (1) no production line stoppage or minimal downtime; (2) time minimisation of
the workstations’ rearrangement; (3) minimisation of investment and rearrangement costs (4) space requirements of the
objects to be located; (5) basement of workstations and machines (3 fixed workstations); (6) more efficient utilisation of
resources (reduction of number of operators and workstations); (7) logical relations of the sub-processes and objects (order
of workstations); (8) free space for two supermarkets on the shop floor; (9) relation of the workstations with the milk-run
path.
(4) Then alternative layouts had to be formed and compared. Since the number of possible alternative layouts is huge,
the number of possible alternatives had to be reduced taking into consideration (1) design aims, (2) design con-
straints and limitations, (3) management’s demands, (4) practical applicability and (5) designer experience. (A
detailed description of the alternative layouts created and compared is not possible in this study due to space
constraints.)
(5) Finally, the most effective option (ideal layout) had to be selected based on the objective function. Then the ideal
layout had to be implemented.
 International Journal of Production Research 15

4.3.2. Calculation of objective function and further KPIs

• Material workflow
Material workflow (detailed in Section 2.3.1) can be calculated by Equation (1):

n 
n
EMWF = qij lij
i=1 j=1

where qij is the material flow between the workstations (UL – unit load which can be a box, pallet, etc.); lij is the distance
between the workstations on the shop floor (m); n is the number of workstations on the shop floor.
In case of the original layout the quantity of the material flow and the distances between workstations are the following:
⎡ ⎤
0 5 0 0 1 5 0 0 0 0 0 0 0 0
⎢0 0 5 0 0 0 0 0 0 0 0 0 0 0⎥
⎢ ⎥
⎢0 0 0 5 0 0 0 0 0 0 0 0 0 0⎥
⎢ ⎥
⎢0 0 0 0 5 0 0 0 0 0 0 0 0 0⎥
⎢ ⎥
⎢0 0 0 0 0 6 0 0 0 0 0 0 0 0⎥
⎢ ⎥
⎢0 0 0 0 0 0 0 0 0 0 0 11 0 0⎥
⎢ ⎥
⎢0 0 0 0 0 0 0 4 0 0 0 0 0 0⎥
QOrig = ⎢⎢ ⎥ [UL]
⎢0 0 0 0 0 0 0 0 4 0 0 0 0 0⎥⎥
⎢0 0 0 0 0 0 0 0 0 4 0 0 0 0⎥
⎢ ⎥
⎢0 0 0 0 0 0 0 0 0 0 4 0 0 0⎥
⎢ ⎥
⎢0 0 0 0 0 0 0 0 0 0 0 4 0 0⎥
⎢ ⎥
⎢0 0 0 0 0 0 0 0 0 0 0 0 15 0 ⎥
⎢ ⎥
⎣0 0 0 0 0 0 0 0 0 0 0 0 0 15⎦
0 0 0 0 0 0 0 0 0 0 0 0 0 0
⎡ ⎤
0 3.5 6 9.5 7 4 18 14.5 13 11.5 5.5 9 12.5 15
⎢ 3.5 0 2.5 6 6.5 7.5 14.5 11 9.5 8 9 12.5 16 18.5⎥
⎢ ⎥
⎢ 6 2.5 0 3.5 9 10 12 8.5 8 9.5 11.5 15 18.5 21 ⎥
⎢ ⎥
⎢ 9.5 6 3.5 0 5.5 9.5 8.5 5 4.5 6 8 11.5 15 17.5⎥
⎢ ⎥
⎢ 7 6.5 9 5.5 0 7 11 7.5 6 4.5 3.5 8 11.5 12 ⎥
⎢ ⎥
⎢ 4 7.5 10 9.5 7 0 18 14.5 13 11.5 3.5 5 8.5 11 ⎥
⎢ ⎥
⎢ 18 14.5 12 8.5 11 18 0 3.5 5 6.5 14.5 19 22.5 20 ⎥
LOrig =⎢
⎢14.5 11
⎥ [m]
⎢ 8.5 5 7.5 14.5 3.5 0 1.5 3 11 15.5 19 16.5⎥⎥
⎢ 13 9.5 8 4.5 6 13 5 1.5 0 1.5 9.5 14 17.5 15 ⎥
⎢ ⎥
⎢11.5 8 9.5 6 4.5 11.5 6.5 3 1.5 0 8 12.5 16 13.5⎥
⎢ ⎥
⎢ 5.5 9 11.5 8 3.5 3.5 14.5 11 9.5 8 0 4.5 8 9.5 ⎥
⎢ ⎥
⎢ 9 12.5 15 11.5 8 5 19 15.5 14 12.5 4.5 0 3.5 6 ⎥
⎢ ⎥
⎣12.5 16 18.5 15 11.5 8.5 22.5 19 17.5 16 8 3.5 0 2.5 ⎦
15 18.5 21 17.5 12 11 20 16.5 15 13.5 9.5 6 2.5 0
After the process improvement the quantity of the material flow and the distances between workstations are the following:
⎡ ⎤
0 5 0 1 5 0 0 0 0 0 0 0
⎢0 0 5 0 0 0 0 0 0 0 0 0 ⎥
⎢ ⎥
⎢0 0 0 5 0 0 0 0 0 0 0 0 ⎥
⎢ ⎥
⎢0 0 0 0 6 0 0 0 0 0 0 0 ⎥
⎢ ⎥
⎢0 0 0 0 0 0 0 0 0 11 0 0 ⎥
⎢ ⎥
⎢0 0 0 0 0 0 4 0 0 0 0 0 ⎥
QNew = ⎢ ⎢ ⎥ [UL]
⎥
⎢0 0 0 0 0 0 0 4 0 0 0 0 ⎥
⎢0 0 0 0 0 0 0 0 4 0 0 0 ⎥
⎢ ⎥
⎢0 0 0 0 0 0 0 0 0 4 0 0 ⎥
⎢ ⎥
⎢0 0 0 0 0 0 0 0 0 0 15 0 ⎥
⎢ ⎥
⎣0 0 0 0 0 0 0 0 0 0 0 15⎦
0 0 0 0 0 0 0 0 0 0 0 0
16 G. Kovács
⎡ ⎤
0 3.5 7.5 7 4 13.5 12 10.5 7.5 10.5 10 13
⎢ 3.5 0 4 6.5 7.5 10 8.5 7 10 14 13.5 10.5⎥
⎢ ⎥
⎢ 7.5 4 0 6.5 7.5 6 5.5 7 10 14 13.5 10.5⎥
⎢ ⎥
⎢ 7 6.5 6.5 0 7 6.5 5 3.5 3.5 7.5 7 6 ⎥
⎢ ⎥
⎢ 4 7.5 7.5 7 0 13.5 12 10.5 7.5 6.5 10 13 ⎥
⎢ ⎥
⎢13.5 10 6 6.5 13.5 0 1.5 3 6 10 9.5 6.5 ⎥
LNew =⎢
⎢ 12
⎥ [m]
⎢ 8.5 5.5 5 12 1.5 0 1.5 4.5 8.5 8 5 ⎥⎥
⎢10.5 7 7 3.5 10.5 3 1.5 0 3 7 6.5 3.5 ⎥
⎢ ⎥
⎢ 7.5 10 10 3.5 7.5 6 4.5 3 0 4 3.5 5.5 ⎥
⎢ ⎥
⎢10.5 14 14 7.5 6.5 10 8.5 7 4 0 3.5 6.5 ⎥
⎢ ⎥
⎣ 10 13.5 13.5 7 10 9.5 8 6.5 3.5 3.5 0 3 ⎦
13 10.5 10.5 6 13 6.5 5 3.5 5.5 6.5 3 0
The material workflow can be calculated by Equation (1).
Total material workflow in case of the original layout is:

EMWFOrig = 365 [UL · m]

Total material workflow after the process improvement is:

EMWFNew = 348 [UL · m]

• Travel distance of materials

Total travel distance of materials is the summation of those elements of the distance matrix in relation material flow are
achieved. In the original manufacturing process, the total travel distance of the materials was 63 m, after the improvement
it was 55 m.
• Material handling cost
The material handling cost is proportional to the quantity of material flow and the travel distances. This cost is linearly
proportional to the material workflow, can be calculated by

CMH = EMWF · cmh (4)

where EMWF is the material workflow; cmh is the specific material handling cost (Euro/UL. m).
The material handling cost after the Lean process improvement was reduced significantly.
• Labour cost of operators
Labour cost is proportional to the number of operators. The reduction of number of operators resulted the saving of
labour cost. The labour cost can be calculated by
CL = NOp · cL (5)
where NOp is the number of operators (person); cL is the specific labour cost (Euro/person).

5. Results of the application of the elaborated combined method

5.1. The newly improved balanced layout
The original layout of the investigated manufacturing plant can be seen in Figure 2. The newly improved balanced layout
can be seen in Figure 5.
The company’s management required process improvement (relayout) to be achieved without production line stoppage
(or with minimal downtime) in order to provide continuous production. Consequently, one of the most important design
aims was the time minimisation of the full process improvement project, because line stoppage results in loss of income and
waste. Therefore, the rearrangement was achieved in 3 phases.
The implementation of the new balanced layout (Figure 5) was achieved in three phases which were the following:
(1) First phase: Workstations 1–6. on original layout (Figure 2). Workstations 1–5. on the new ideal layout after
process improvement (Figure 5).
 International Journal of Production Research 17

Workstations 1, 5 and 6 of the original layout are located in a fixed position, but all of the other workstations were arbitrarily
moveable on the shop floor.
The rearrangement of the fixed positioned workstations would have been very costly and would have required a long
time and too much downtime; therefore – at my and management’s suggestions – these 3 workstations were not moved. But
after balancing, workstation 4 was eliminated by reallocating its task to workstations 2 and 3. Consequently, the number of
workstations and operators was reduced by 1.
(2) Second phase: Workstations 7–11. on original layout (Figure 2). Workstations 6–9. on the new ideal layout after
process improvement (Figure 5).
Workstation 7 was also eliminated by reallocating its task to workstation 8. Consequently, the number of workstations and
operators was further reduced by 1.
The subprocesses of workstation 8 were allocated to workstation 9. The subprocesses of workstation 9 were reallocated
to workstation 10. Due to the reconfiguration the cycle time of workstation 9 was reduced, so workstation 9 – which was
earlier a bottleneck – was eliminated.
(3) Third phase: Workstations 12–14. on original layout (Figure 2). Workstations 10–12. on the new ideal layout after
process improvement (Figure 5).
The conception of the redesign in my and management’s opinions – was that phase 2 (workstations 6–9 on the new layout)
and phase 3 (workstations 10–12 on the new layout) had to be handled as one logical technological process, due to the
characteristics of the manufacturing activity. It was the main reason that only one U cell was formed instead of two U cells.
Therefore, the linear layout configuration (workstations 7–14 on the original layout) was organised into one U-shaped cell
(workstations 6–12 on the newly improved layout).
Further reduction of the number of workstations and operators was not possible in the case of workstations 6–12, because
the subprocesses of the assembling activities cannot be allocated to other workstations due to technological reasons, and
also because of the results of Takt-time analysis, since the calculated takt-time (Equation (2)) is 5.62 min/unit (Section
4.2.2). Based on Equation (3) the number of workstations and operators cannot be reduced on workstations 6–12 on the new
improved layout, because 8 operators are needed in the U cell. (Consequently, in the case of the implementation of two U
cells the number of workers could not be reduced, either.)
Two shifts were running at the company, so there was no downtime, because the three-phase rearrangement was carried
out on workdays outside working hours and at weekends.
The total cost of the full implementation – including the costs of the rearrangement and the implementation of the 13
Lean tools – was declared as a business secret by the company. The total time of the full implementation – including times
of the rearrangement and the implementation of the 13 Lean tools – was 11 weeks.
The results of the comparison of the original and the improved balanced layout can be seen in Table 3. One of the most
important results was that after the reorganisation of the layout 56 m2 of free floor space was gained in the manufacturing
plant. This area was used for further value-added activities (establishment of new workstations). Another important result
of the process improvement was that the total workload of the total manufacturing process, which was achieved in the
original state by 14 workstations and 14 operators, required only 12 workstations and 12 operators after Line balancing
(after reallocating the workloads). The freed-up workers were employed at the new workstations established in the new free
area.

5.2. Results of comparison of the original and the improved balanced layout
The original layout and the newly improved balanced layout were compared based on 15 indicators including 10 quantitative
and 5 qualitative indicators (in first column of Table 3). The results of the process improvement are that all of the 15
indicators were significantly improved.
1. Longest cycle time (Reduction by 11.47%)
The activity at workstation 9 was a critical bottleneck in the original production process, because its cycle time (6.1 min)
took much longer than takt-time (5.62 min). After Line balancing the longest cycle time became 5.4 min, which defines the
throughput of the whole manufacturing process (Table 2; Figure 4).
2. Productivity improvement (Increase by 13.7%)
Before Line balancing workstation 9 was the bottleneck; its cycle time was 6.1 min. In the new improved process, the longest
cycle time became 5.4 min. Therefore, before Line balancing the productivity of the production line was 73 (units/shift),
while after it the productivity became 83 (units/shift).
18 G. Kovács

Table 3. Results of newly elaborated combined process improvement.

Original Newly improved
manufacturing manufacturing
Indicators for comparison process (Figure 2) process (Figure 5) Difference
Quantitative indicators:
1. Longest cycle time in the whole production process (min) 6.1 5.4 − 11.47%
2. Productivity (units/shift) 73 83 + 13.7%
3. Number of workstations (pieces) 14 12 − 14.28%
4. Number of operators (person) 14 12 − 14.28%
5. WIP inventory (%) 100 64 − 36%
6. Space used for assembly (m2 ) 250 193.75 − 22.5%
7. Material workflow (UL. m) 365 348 − 4.66%
8. Travel distance of materials (m) 63 55 − 12.7%
9. Material handling cost (%) 100 95.34 − 4.66%
10. Labour cost of operators (%) 100 85.72 − 14.28%
Qualitative indicators:
11. Reliability of continuous component supply of the production lines improved
12. Quality of the processes and final products improved
13. Transparency of the processes improved
14. Standardisation of the processes improved
15. Workplace ergonomics and worker’s satisfaction improved

3–4. Number of workstations and operators ( − 2/ − 2 pieces)

After Line balancing workstation 4 and workstation 7 were eliminated by reallocating the workloads of these workstations
to the adjacent upstream or downstream workstations (Figure 4). The total workload which was achieved earlier by 14
workstations and 14 operators could be achieved by 12 workstations and 12 operators after balancing.
5. WIP inventory (Reduction by 36%)
Due to the simultaneous implementation of the U-shaped cellular layout, Pull, JIT, Kanban and One-piece flow methods the
WIP stock was reduced significantly.
6. Space used for assembly (Reduction by 22.5%)
After the reorganisation of the layout (Cellular design method: U-shaped cell instead of linear assembly line) 56 m2 of free
floor space was gained in the manufacturing plant.
7. Material workflow (Reduction by 4.66%)
In the original layout the total material workflow was 365 (UL·m), after the improvement it became 348 (UL·m).
8. Travel distance of materials (Reduction by 12.7%)
In the original layout the total travel distance of the materials was 63 m, after the improvement it became 55 m.
9. Material handling cost (Reduction by 4.66%)
After the process improvement the material handling cost was reduced.
10. Labour cost of operators (Reduction by 14.28%)
The reduction of number of operators resulted the saving of labour cost.
11. Reliability of continuous component supply of production lines
The continuous component supply became more reliable by the simultaneous implementation of the Cellular design, JIT,
Kanban, Supermarket, 5S, One-piece flow and Visual management methods.
12. Processes’ and final products’ quality
Due to the application of the Cellular design, JIT, Kanban, 5S, One-piece flow, Visual management and Standardisation
methods the quality of the process and the final products was improved.
13. Processes’ transparency
The manufacturing processes became more transparent by the simultaneous implementation of the Cellular design, Kanban,
Supermarket, 5S, One-piece flow, Visual management and Standardisation methods.
14. Processes’ standardisation
Due to the application of the 5S, Visual management and Standardisation methods well defined standardised processes were
created and implemented.
15. Workplace ergonomics and worker’s satisfaction
Due to the application of the Cellular design, Supermarket, 5S, Workplace ergonomics, Visual management and
Standardisation methods the workplace ergonomics and worker’s satisfaction was improved.
 International Journal of Production Research 19

6. Conclusions and future research

The methodology and procedure of a new combined efficiency improvement method were elaborated which basically applies
Lean methods and also uses the Facility Layout Design (FLD) method simultaneously, integrating the different elements and
advantages of these methods, which is even more efficient that applying each of the methods individually. The application of
the combined method results in even more significant efficiency improvement, cost reduction and improvement of several
KPIs.
The newly elaborated combined method utilises the several significant advantageous differences of the Lean and FLD
methods, which provides the main contributions of the application of the combined method to the industrial application.
These main contributions are the following:

(1) The aims of both methods are taken into consideration in the new combined method: on the one hand to focus on
the elimination of waste or non-value-added activities, on the other hand to achieve the optimal arrangement of
facilities and optimal material flow on the shop floor.
(2) FLD provides the possibility of defining the optimal arrangement of the workstations on a manufacturing site; in
addition, the number of workstations can even be also reduced by the application of Lean methods (Takt-time
analysis and Line Balancing methods).
(3) By the application of the combined method – due to the usage of the FLD method – the total travel distance of
materials and total material workflow can also be minimised, leading to the minimisation of the material handling
cost and minimisation of the space used for assembly. Therefore, these four KPIs can also be improved by the
combined method.
(4) In the elaborated combined method – due to the application of the Lean methods – not only the quantitative indi-
cators, but at the same time the qualitative indicators (e.g. quality of the processes and final products, workplace
ergonomics, etc.) can also be improved.
(5) In the new combined method by the application of Lean methods (e.g. Cellular design, Supermarket, Kanban, etc.)
the huge number of possible layout alternatives can also be reduced.

This study not only discusses the methodology, procedure and practical steps of the elaborated combined method, but
also introduces a real case study to confirm that the new combined method can be applied effectively in practice for an
increase in productivity and a reduction in costs in manufacturing processes.
In the case study a process improvement of a manufacturing plant was carried out in order to show how significant
efficiency improvement and cost saving can be achieved by application of 13 Lean methods and – due to the usage of
FLD method – the total material workflow, the travel distance of materials, the material handling cost and the space used
for assembly also could be reduced. From the case study it can be concluded, that – by the application of the new com-
bined method – significant improvement of efficiency and cost reduction can be achieved and all of the 15 indicators were
improved (Table 3).
The main significant added value and novelty of the study is that I elaborated the methodology and the procedure of a
new combined efficiency improvement method, and at the same time the efficiency of the elaborated combined method is
confirmed by a real industrial project. This elaborated combined method – due to the utilisation of the different advantageous
elements of the Lean and FLD methods – results in even more significant efficiency improvement, operational cost reduction
and the improvement of more KPIs.
In the last 7 months, the results of the process improvement were continuously monitored. The targeted aims were
successfully fulfilled, and company’s management is totally satisfied with the results of the R&D project.
The aims of my future research are the following: The fifth principle of the Lean philosophy is ‘Perfection – Continuous
improvement’. It means that there is no perfect process, every process can be improved. In this spirit, manufacturing pro-
cesses can also be improved in the future by the application of the same or further Lean methods. Furthermore, due to the
higher utilisation of the different advantages of the Lean and FLD methods even more significant efficiency improvement
can be achieved.
In this article, the original and the newly improved layouts were compared based on the most important KPIs (including
also material handling and labour costs), and the process improvement was confirmed. In my future publications – in addition
to the numerical comparison of the selected KPIs – I will make an in-depth cost/benefit analysis during the selection of the
ideal layout alternative.

Disclosure statement
No potential conflict of interest was reported by the author.
20 G. Kovács

References
Alemu, M. B., W. Torgeir, and H. Petri. 2014. “Approaching Lean Product Development Using System Dynamics: Investigating Front-
Load Effects.” Advanced Manufacturing 2: 130–140.
Anjos, M. F., and M. V. C. Vieira. 2017. “Mathematical Optimization Approaches for Facility Layout Problems: The State-of-the-art and
Future Research Directions.” European Journal of Operational Research 261: 1–16.
Bai, C., A. Satir, and J. Sarkis. 2019. “Investing in Lean Manufacturing Practices: an Environmental and Operational Perspective.”
International Journal of Production Research 57 (4): 1037–1051.
Beemsterboer, B., M. Land, and R. Teunter. 2017. “Flexible lot Sizing in Hybrid Make-to-Order/Make-to-Stock Production Planning.”
European Journal of Operational Research 260: 1014–1023.
Braglia, M., M. Frosolini, and M. Gallo. 2017. “SMED Enhanced with 5-Whys Analysis to Improve set-up Reduction Programs: The
SWAN Approach.” International Journal of Advanced Manufacturing Technology 90: 1845–1855.
Braglia, M., M. Frosolini, M. Gallo, and L. Marrazzini. 2019. “Lean Manufacturing Tool in Engineer-to-Order Environment: Project Cost
Deployment.” International Journal of Production Research 57 (6): 1825–1839.
Chay, T. F., Y. C. Xu, A. Tiwari, and F. Chay. 2015. “Towards Lean Transformation: The Analysis of Lean Implementation Frameworks.”
Journal of Manufacturing Technology Management 26 (7): 1031–1052.
Chen, C., and L. K. Tiong. 2019. “Using Queuing Theory and Simulated Annealing to Design the Facility Layout in an AGV-Based
Modular Manufacturing System.” International Journal of Production Research 57 (17): 5538–5555.
Chiarini, A. 2013. Lean Organization: From the Tools of the Toyota Production System, to Lean Office, Perspectives in Business Culture
3. Springer-Verlag.
Chiarini, A., P. Found, and N. Rich, eds. 2016. Understanding the Lean Enterprise - Strategies, Methodologies, and Principles for a More
Responsive Organization. New York: Springer.
Dennis, P. 2015. Lean Production Simplified. New York: CRC Press.
Dolgui, A., N. Guschinsky, and G. Levin. 2009. “A Design of DSS for Mass Production Machining Systems.” Bulletin of the Polish
Academy of Sciences: Technical Sciences 57 (3): 265–271.
Erlach, K. 2013. Value Stream Design: The Way Towards a Lean Factory. Berlin: Springer-Verlag.
García-Alcaraz, J. L., and A. A. Maldonado-Macías. 2016. Just-In-Time Elements and Benefits. Springer.
Heragu, S. S. 2016. Facilities Design. CRC Press.
Hosseini-Nasab, H., S. Fereidouni, S. M. T. F. Ghomi, and M. B. Fakhrzad. 2018. “Classification of Facility Layout Problems: A Review
Study.” International Journal of Advanced Manufacturing Technology 94: 957–977.
Huawei, C., L. Guoping, T. Haining, W. Aimin, and N. Ruxin. 2016. “Layout Adjustment of Cellular Production Line Based on Material
Logistic Analysis.” The International Journal of Advanced Manufacturing Technology 87: 1409–1420.
Kamble, S., A. Gunasekaran, and N. C. Dhone. 2019. “Industry 4.0 and Lean Manufacturing Practices for Sustain-
able Organisational Performance in Indian Manufacturing Companies.” International Journal of Production Research,
doi:10.1080/00207543.2019.1630772.
Keller, B., and U. Buscher. 2015. “Single row Layout Models.” European Journal of Operational Research 245: 629–644.
Kot, S. 2018. “Sustainable Supply Chain Management in Small and Medium Enterprises.” Sustainability 1143: 1–19.
Kovács, Gy. 2017. Changes in Production Philosophies – Efficiency Improvement of Production and Logistics Processes. Hungary:
University Press: University of Miskolc.
Naik, B. S., and S. Kallurkar. 2016. “A Literature Review on Efficient Plant Layout Design.” International Journal of Industrial
Engineering Research and Development 7 (2): 43–51.
Nallusamy, S., and V. Saravanan. 2016. “Enhancement of Overall Output in a Small Scale Industry Through VSM, Line Balancing and
Work Standardization.” International Journal of Engineering Research in Africa 26: 176–183.
Ojaghi, Y., A. Khademi, N. M. Yusof, N. G. Renani, and S. A. Helmi. 2015. “Production Layout Optimization for Small and Medium
Scale Food Industry.” Procedia CIRP 26: 247–251.
Oliveira, R. I., S. O. Sousa, and F. C. Campos. 2019. “Lean Manufacturing Implementation: Bibliometric Analysis 2007–2018.” The
International Journal of Advanced Manufacturing Technology 101 (1–4): 979–988.
Orr, L. M., and D. J. Orr. 2014. Eliminating Waste in Business, Run Lean, Boost Profitability. USA: Apress.
Pearce, A., D. Pons, and T. Neitzert. 2018. “Implementing Lean: Outcomes From SME Case Studies.” Operations Research Perspectives
5: 94–104.
Peetu, P., J. Koshy, and C. A. Biju. 2013. “Conversion of Regular Assembly Line Into Cellular Manufacturing Layout.” International
Journal of Engineering and Innovative Technology 7: 1–9.
Pourvaziri, H., and H. Pierreval. 2017. “Dynamic Facility Layout Problem Based on Open Queuing Network Theory.” European Journal
of Operational Research 259: 538–553.
Riyad, H., R. Kamruzzaman, and T. Subrata. 2014. “Increasing Productivity Through Facility Layout Improvement Using Systematic
Layout Planning Pattern Theory.” Global Journal of Researches in Engineering 14 (7): 1–7.
Shang, G., and P. L. Sui. 2014. Lean Construction Management - The Toyota Way. Singapore: Springer.
Shingo, S. 2017. Fundamental Principles of Lean Manufacturing. Bellingham: Productivity Press.
Sigma Savvy. 2019. Accessed January 7. http://www.sigmasavvy.com/5-lean-principles-everything-you-need-to-know/.
Tortorella, G. L., D. Fettermann, P. A. C. Miguel, and R. Sawhney. 2019. “Learning Organisation and Lean Production: an Empirical
Research on Their Relationship.” International Journal of Production Research, doi:10.1080/00207543.2019.1633028.
 International Journal of Production Research 21

Tortorella, G. L., L. G. L. Vergara, and E. P. Ferreira. 2017. “Lean Manufacturing Implementation: an Assessment Method with Regards
to Sociotechnical and Ergonomics Practices Adoption.” International Journal of Advanced Manufacturing Technology 89 (9-12):
3407–3418.
Tubaileh, A., and J. Siam. 2017. “Single and Multi-Row Layout Design for Flexible Manufacturing Systems.” International Journal of
Computer Integrated Manufacturing 30 (12): 1316–1330.
Uriarte, A. G., H. C. N. Amos, and M. U. Moris. 2020. “Bringing Together Lean and Simulation: a Comprehensive Review.” International
Journal of Production Research 58 (1): 87–117.
Vitayasak, S., and P. Pongcharoen. 2015. “Re-layout and Robust Machine Layout Design Under Stochastic Demand.” Applied Mechanics
and Materials 789-790: 1252–1257.
Yadav, O. P., B. P. Nepal, M. M. Rahaman, and V. Lal. 2017. “Lean Implementation and Organizational Transformation: A Literature
Review.” EMJ – Engineering Management Journal 29 (1): 2–16.
Yildirim, C., B. S. Oflaç, and O. Yurt. 2018. “The Doer Effect of Failure and Recovery in Multi-Agent Cases: Service Supply Chain
Perspective.” Journal of Service Theory and Practice 28 (3): 274–297.
Yu, K., J. Cadeaux, and H. Song. 2017. “Flexibility and Quality in Logistics and Relationships.” Industrial Marketing Management 62:
211–225.
Zhou, B. 2016. “Lean Principles, Practices, and Impacts: a Study on Small and Medium-Sized Enterprises (SMEs).” Annals of Operations
Research 241: 457–474.