PRODUCT MANUFACTURING &

PLANT LAYOUT

Widodo Wahyu Purwanto

Departemen Teknik Kimia
Chemical Product Design 2021
 Outline

Final Specifications
Prototyping
Manufacturing
Plant Layout
Concept Selection - Revisit
Final specifications -revisit
Final specifications
 Final Product Specification

The type of product : ingredient, microstructure

Target market
Portion size, dimensions, weight
Details of anticipated: appearance, taste and texture.
Storage method
Expected shelf-life
Estimated cost: overall or per portion
Packaging
Production method
NG, 2017
NG, 2017
 What is a prototype?

n Looks like a finished product?

n Behaves like a finished product?

n May have small faults or missing

functionalities?
3D prototyping
Typical prototyping
Manufacturing Process Design

Forecast Demand
Plan for Capacity
Choose Facility Site
Design Facility Layout
Schedule Work
Forecasting Role in Decision-making

Objectives
External and Planned
And
Internal Data Performance
Constraints

Forecasts Managers Operations

Updated Actual
Forecasts Performance Resources
 Forecasting in Business Planning
Inputs
Market Conditions
Competitor Action
Consumer Tastes
Products’ Life Cycle
Outputs
Season
Customers’ plans Forecasting Estimated Demands
Method(s) for each Product
Economic Outlook Or Model(s) in each Time Period
Business Cycle Status Other Outputs
Leading Indicators-Stock
Prices, Bond Yields, Material
Prices, Business Failures, money Management Team
Supply, Unemployment Production Capacity
Available Resources
Other Factors Risk Aversion
Legal, Political, Sociological, Experience
Cultural
Processor Personal Values and
Motives
Forecast Social and Cultural
Sales Forecast
Errors Values
Forecast and Demand
Feedback for Each Product Other Factors
In Each Time Period
 Forecasting Factors
Time required in future
Availability of historical data
Relevance of historical data into future
Demand and sales variability patterns
Required forecasting accuracy and likely
errors
Planning horizon/lead time for operational
moves
 Types of Forecasts
Economic Forecasts- projections of economic
growth, inflation rates, money supply based
on economic
Technological Forecasts- predicting
technological change e.g. in cloud computing
or electronics sectors et al
Business Forecasts- involving demand and
sales forecasts
 Forecasting Horizon-focus
Short term forecasts – say for next 1-2 months for current
production planning and scheduling; for specific products,
machine capacities and deployment, labor skills and usage,
cash inventories ; operational focus
Medium term forecasts – say for next 3-12 months for plant
level planning for product/volume changes requiring
redeployment of resources; for product groups, departmental
capacities, work force management, purchased materials and
inventories; tactical focus
Long term forecasts – 1 year to 3 years for planning a new
plant or facility requiring major investments and other
resources for both new and old product lines; strategic focus
 Capacity
Design capacity
– maximum output rate or service capacity an
operation, process, or facility is designed for
Effective capacity
– Design capacity minus allowances such as
personal time, maintenance, and scrap
Actual output
– rate of output actually achieved--cannot
exceed effective capacity.
 Efficiency and Utilization
Actual output
Efficiency =
Effective capacity

Actual output
Utilization =
Design capacity

Both measures expressed as percentages

 Capacity Considerations
The Best Operating Level is the output that results in the
lowest average unit cost
Economies of Scale:
– Where the cost per unit of output drops as volume of output
increases
– Spread the fixed costs of buildings & equipment over multiple
units, allow bulk purchasing & handling of material
Diseconomies of Scale:
– Where the cost per unit rises as volume increases
– Often caused by congestion (overwhelming the process with too
much work-in-process) and scheduling complexity
 Best Operating Level and Size

Alternative 1: Purchase one large facility, requiring one large

initial investment
Alternative 2: Add capacity incrementally in smaller chunks as
needed
 Tactics for Matching
Capacity to Demand
(a) Leading demand with (b) Leading demand with
incremental expansion one-step expansion
New New
capacity capacity
Demand

Demand
Expected Expected
demand
demand

(c) Capacity lags demand with (d) Attempts to have an average

incremental expansion capacity with incremental
New
expansion
capacity New
Expected Demand capacity Expected
Demand

demand demand
 Break-Even Analysis
–
Total revenue line
900 –

800 – or
r id Total cost line
Break-even point or
700 – Total cost = Total revenue ti c
of
Pr
Cost in dollars

600 –

500 –

400 – Variable cost

300 –

200 – oss or
L rid
r
co
100 – Fixed cost
|– | | | | | | | | | | |
0 100 200 300 400 500 600 700 800 900 1000 1100
Volume (units per period)
 Break-Even Example
50,000 –

Revenue
40,000 –
Break-even
point Total
30,000 –
costs
Dollars

20,000 –

Fixed costs
10,000 –

–
| | | | | |
0 2,000 4,000 6,000 8,000 10,000
Units
 Factors Affecting Location
Decisions
Proximity to source of supply:
– Reduce transportation costs of perishable or bulky raw
materials
Proximity to customers:
– High population areas
Proximity to labor:
– Local wage rates, attitude toward unions, availability of
special skills (silicon valley)

28
 More Location Factors
Community considerations:
– Local community’s attitude toward the facility (prisons,
utility plants, etc.)
Site considerations:
– Local zoning & taxes, access to utilities, etc.
Quality-of-life issues:
– Climate, cultural attractions, commuting time, etc.
Other considerations:
– Options for future expansion, local competition, etc.
 Globalization –
Should Firm Go Global?
Potential advantages:
– Inside track to foreign markets, avoid trade barriers, gain access to
cheaper labor
Potential disadvantages:
– Political risks may increase, loss of control of proprietary technology,
local infrastructure (roads & utilities) may be inadequate, high inflation
Other issues to consider:
– Language barriers, different laws & regulations, different business
cultures
Manufacturing vs. GNP
Levels of Manufacturing
Manufacturing
Definitions of Manufacturing
Basic Issues of Manufacturing
Basic Operation
Manufacturing system
Manufacturing unit process
 Manufacturing process
A flow diagram should be presented giving the steps
of the process and showing where materials enter
the process. The critical steps and points at which
process controls, intermediate tests or final product
controls are conducted should be identified. Stages
of manufacture, at which sampling is carried out for
in-process control tests, should be indicated.
A narrative description of the manufacturing process,
including packaging, that represents the sequence of
steps undertaken and the scale of production should
also be provided. For sterile products, details of
sterilization processes and/or aseptic procedures
used must be describe
 Manufacturing process

Equipment should, at least, be identified by type

(e.g., high-speed granulator, fluid bed drier) and
working capacity, where relevant.
Steps in the process should have the appropriate
process parameters identified, such as time,
temperature, or pH.
Environmental conditions, e.g. relative humidity
for hygroscopic FPPs., area class for sterile FPPs
Type of process based on product volume

• Intermittent processes:
Processes used to
produce a variety of
products with different
processing
requirements in lower
volumes. (such as
healthcare facility)
• Repetitive/continuous
processes:
Processes used to
produce one or a few
standardized products
in high volume. (such
as a cafeteria, or car
wash)
Batch vs Continuous
Cell Manufacturing
Good Manufacturing Practice
(GMP)
Government requirement
Ensure quality product
Reduce rejects, recalls
Satisfied customers
Maintain manufacturing consistency
Company image and reputation
Plant layout/Facility Layout
 Objectives of Plant Layout
Congestion reduction.
Elimination of unnecessary occupied areas.
Reduction of administrative and indirect work.
Improvement on control and supervision.
Better adjustment to changing conditions.
Better utilization of the workforce, equipment and services.
Reduction of material handling activities and stock in process.
Reduction on parts and quality risks.
Reduction on health risks and increase on workers safety.
Moral and workers satisfaction increase.
Reduction on delays and manufacturing time, as well as
increase in production capacity.
Relationships between Plant Layout and
Type of Production Facility
 Line Layout planning
A B C D E

B A
A B C
Basic Flow Patterns
C
F EA DB D

F E
A B C
A E
D
B D
E C
Flexible line layout
 Types of Plant Layout
The production process normally determines the type of
plant layout to be applied to the facility:
– Fixed position plant layout
• Product stays and resources move to it.
– Product oriented plant layout
• Machinery and Materials are placed following the
product path.
– Process oriented plant layout (Functional Layout).
• Machinery is placed according to what they do and
materials go to them.
– Cell Layout
• Hybrid Layout that tries to take advantage of different
layouts types.
 Fixed-Position Layout

• The fixed-position layout is a facility layout in which labor, materials, and

equipment are brought to the location where the good is being produced or the
customer is being served. Buildings, roads, bridges, airplanes, and ships are
examples of the types of large products that are typically constructed using a
fixed-position layout.
 Product Oriented Layout

• The product layout or assembly-line layout, the main production process occurs
along a line, and products in progress move from one workstation to the next.
Materials and subassemblies of component parts may feed into the main line at
several points, but the flow of production is continuous. Electronics and personal-
computer manufacturers are just two of many industries that typically use this
layout.
 Process Layout

• A process layout or functional layout because it concentrates everything

needed to complete one phase of the production process in one place. The
process layout is often used in machine shops as well as in service
industries.
 Cellular Layout
Process (Functional) Layout Group (Cellular) Layout
A cluster
or cell
T T T CG CG T T T
M
T T T SG SG M M T

D D M D
M M D D D
SG CG CG D
M M D D D
SG

• A cellular layout groups dissimilar machines into work centers (or cells) to process parts that have
similar shapes and processing requirements. Arranging work flow by cells can improve the
efficiency of a process layout while maintaining its flexibility. At the same time, grouping smaller
numbers of workers in cells facilitates teamwork and joint problem solving. Employees are also
able to work on a product from start to finish, and they can move between machines within their
cells, thus increasing the flexibility of the team. Cellular layouts are commonly used in computer
chip manufacture and metal fabricating.
 Flow and acitivy analysis
Milling
Lathe Department Department Drilling Department
M M D D D D
L L

M M D D D D
L L

G G G P
L L

G G G P
L L
Grinding Painting Department
Department
L L
Receiving and A A A
Shipping Assembly
Performance matrics
Factory performance measures
 Planning & Control
Modern manufacturing industry consists of fabrication and
assembly
A plant has to
– purchase raw material or parts
– convert them into specific components
– assemble the components into the several products
Different products could contain several common components

Plant

Fabrication Assembly
Raw Material or Finished
Storage
Storage

Storage
Parts Products

A Typical Manufacturing Plant

Flowchart for Different Product Strategies
Styles for Demand Satisfactions
 Planning & Control
The information-subsystems that play a vital role in the smooth
running of the company are
– Demand forecasting
– Operations planning
– Inventory planning and control
– Operations scheduling
– Dispatching
Demand Forecasting
– history and the current trends
– sales data reflects its effectiveness
Operations Planning
– development engineers look for a better manufacturing sequence
– the input comes from standard operation times, setup times
– machines and other facilities are grouped for a proper assembly-
line operation
 Planning & Control
Inventory Planning & Control
– includes parts, raw materials, assemblies, supplies etc.
– depicts the order quantities; reorder points, safety
stocks of raw materials, and manufacturing batch sizes
Operations Scheduling
– a detailed operation sequence for individual activities
– start and stop times for all operations
– schedule conflicts on production facilities are resolved
here
Dispatching
– responsible for initializing production
– releases work orders to production operations at the
appropriate time
 Operations Scheduling
It is the heart of entire planning and control systems
Compromises must be made between economic batch
sizes, due dates, resource constraints, manpower
leveling, and facility utilization
Program evaluation review technique PERT charts are
used for scheduling activities. It is a powerful tool
PERT chart tell a manager
– list of operations necessary to finish a project
– time needed for each operation
– critical activities – activities that consume the largest
part of project-completion-time
Critical path – a sequence of critical activities
Using PERT chart is also named as critical path method
(CPM)
 Operations Scheduling
• Critical Path Method (CPM)
Activity Description Required Predecessor Duration D, 5
2 55
A, 6 C, 3 G, 5

A Product design None 6 F, 4 J, 1

11 E, 3 77 88
B, 2 44
B Market research None 2 I, 2
H, 3
3
C Production analysis A 3 66
Network Diagram for CPM
D Product model A 5

E Sales brochure A 3
A→D→G 6+5+5 = 16 Critic
F Cost analysis C 4
A→C→F 6+3+4 = 13
G Product testing D 5
A→E→H→I 6+3+3+2 = 14
H Sales training B, E 3 B*→H→I 3*+3+2 = 8
I Pricing H 2
Critical Path Analysis
J Project report F, G, I 1

Activities in a Manufacturing System

 Estimate the Manufacturing Costs
Equipment Information Tooling

Raw Materials

Labor
Manufacturing System Finished Goods
Purchased
Components

Energy Supplies Services Waste

Thank You