Bismillahir Rahmanir Raheem

IPE – 2111
Chapter 3
Plant Management

Chapter 3: Plant Management: Facilities - Location and

Layout; Types of plant maintenance - Breakdown, Schedule,
predictive and preventive; Industrial safety; Causes and costs
of accidents; Production planning and control; Job, Batch and
Process type of production.

Presented by
Prof. Dr. Md. Abdul Hanna Shaikh
Department of Management
Islamic University.
•Cell: 017718552638

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After reading this chapter, you should
be able to
Define production facilities, its location and
layout.
Describe the plant maintenance, its types and
objectives.
Explain industrial safety and causes and costs
of accidents.
Enumerate production planning and control.
Discuss the Production Process - Job, Batch,
Repetitive and Continuous.
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 Facilities Planning
Facilities are the plant and the office within which Production Manager does
its work.
There are four main components of facilities planning and they strongly
interact with each other.

Location of plant, or the branch, or the warehouse.

Specific structure and site.
Layout.
Furniture, lighting, decorative features, and equipment.

In the international production systems, international markets, and rapid

technological transfers, facilities planning requires a team effort.

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 Location
Concept of Facility Location
Facility location may be defined as a place where the facility will be setup for
producing goods or services.

Need for Location Decisions

1.Marketing Strategy
2.Cost of Doing Business
3.Growth
4.Depletion of Resources

•Service industries locate close to their customers.

•Extractors like to be close to their raw materials.
•Fabricators like to be close to their raw materials and customers.
•Assembly plants try to keep their component suppliers close-by.

Best location is related to the function of the facility and the characteristics of its
products and services.
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 Nature of Location Decisions
• Strategic Importance of location decisions
– Long term commitment/costs
– Impact on investments, revenues, and operations
– Supply chains
• Objectives of location decisions
– Profit potential
– No single location may be better than others
– Identify several locations from which to choose
• Location Options
– Expand existing facilities
– Add new facilities
– Move

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 Making Location Decisions
1) Decide on the criteria
2) Identify the important factors
3) Develop location alternatives
4) Evaluate the alternatives
a) Identify general region
b) Identify a small number of community
alternatives
c) Identify site alternatives
5) Evaluate and make selection

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 Location Decision Factors
Community
Regional Factors Considerations

Multiple Plant Site-related

Strategies Factors

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 Regional Factors
1. Location of raw materials
2. Location of markets
3. Labor factors
4. Climate and taxes
Community Considerations
1. Quality of life
2. Services
3. Attitudes
4. Taxes
5. Environmental regulations
6. Utilities
7. Developer support

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 Site Related Factors
1. Land
2. Transportation
3. Environmental
4. Legal
Multiple Plant Strategies
1. Product plant strategy
2. Market area plant strategy
3. Process plant strategy

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 Process Selection and Facility Layout
• Process selection
– Deciding on the way production of goods or
services will be organized
• Major implications
– Capacity planning
– Layout of facilities
– Equipment
– Design of work systems

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 Process Types
• Job shop
– Small scale
• Batch
– Moderate volume
• Repetitive/assembly line
– High volumes of standardized goods or services
• Continuous
– Very high volumes of non-discrete goods

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 Product and Service Processes
Process Type Job Batch Repetitive Continuous
Job Shop Appliance repair Ineffective
Emergency room
Batch Commercial
banking
Classroom Lecture
Repetitive Automotive
assembly
Automatic carwash
Continuous Ineffective Steel Production
Water purification
(flow)
Job variety Very High Moderate Low Very low
Process flexibility Very High Moderate Low Very low
Unit cost Very High Moderate Low Very low
Volume of output Very High Low High Very low

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 Facilities Layout
Facility layout may be defined as the arrangement of
machinery, equipment, and other amenities in a facility,
which should ensure a smooth movement of materials.
Layout: the configuration of departments, work centers,
and equipment, with particular emphasis on movement of
work (customers or materials) through the system
• Product layouts
• Process layouts
• Fixed-Position layout
• Combination layouts

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 Objective of Layout Design
1. Facilitate attainment of product or service quality
2. Use workers and space efficiently
3. Avoid bottlenecks
4. Minimize unnecessary material handling costs
5. Eliminate unnecessary movement of workers or
materials
6. Minimize production time or customer service time
7. Design for safety

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 Importance of Layout Decisions
• Substantial investments of money and effort
• Long-term commitments
• Impact on cost and efficiency of short-term operations
Need for Layout Design
1) Inefficient operations
2) Changes in the design of products or services
3) Introduction of new products or services
4) Accidents/Safety hazards
5) Changes in environmental or other legal requirements
6) Changes in volume of output or mix of products
7) Changes in methods and equipment
8) Morale problems

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 Basic Layout Types
1. Product layout
Layout that uses standardized processing operations to achieve
smooth, rapid, high-volume flow Product x, y, z
2. Service layout
Service layouts must be aesthetically pleasing as
well as functional Serv st 1 st 2 st3
3. Process layout
Layout that can handle varied processing requirements P a, b, c
4. Fixed Position layout
Layout in which the product or project remains stationary, and
workers, materials, and equipment are moved as needed constn
5. Combination layouts

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Plant Maintenance

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 Types of Maintenance
a) Corrective or breakdown maintenance,
b) Scheduled maintenance,
c) Preventive maintenance, and
d) Predictive maintenance.
Causes of Equipment Breakdown:
i) Failure to replace worn out parts.
ii) Lack of lubrication.
iii) Neglected cooling system.
iv) Indifference towards minor faults.
v) External factors (such as too low or too high line voltage,
wrong fuel, etc.)
vi) Indifference towards -equipment vibrations, unusual
sounds coming out of the rotating ma¬chinery, equipment
getting too much heated up, etc.

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 What is Industrial Safety
Industrial safety is a management activity which
is concerned with
Reducing,
Controlling, and
Eliminating accidents and hazards from the
industrial unit.
What is a Workplace Accident?
The Occupational Safety and Health Administration (OSHA) has
defined workplace accident as ''unplanned event that results in
personal injury or property damage.''
Types of Workplace Accidents
1. Overexertion: Such as sprains and strains (from pull a bookcase,
carry heavy equipment or lift awkward boxes).
2. Falling: Falling presents a significant risk in many work
environments e.g. falling down stairs or tumbling off a roof.
3. Slips and trips: e.g. slipping on a banana peel. muscle strains and
other injuries.
4. Falling objects: Heavy box of files or a piece of machinery, falling
objects present risk of head injuries to workers.
5. Repetitive motion: Frequent computer users struggle with carpal
tunnel syndrome, auto mechanics develop chronic back pain.
Taking Shortcuts
Being over-confident
Starting a Task with Incomplete Instructions
Poor Housekeeping
Ignoring Safety Procedures
Mental Distractions from Work
Failure to Pre-Plan the Work
 Costs of Accidents
Accidents of any kind have both direct and indirect
costs.
Direct costs:
i.Cost of insurance increases a result of accident,
ii.Out-of-pocket costs associated with damages,
iii.Workers' compensation payments,
iv.Medical expenses, and
• Costs for legal services.
 Indirect costs
1) Loss of Productivity or Service Standards.
2) Additional Supervision Time and Administrative Costs.
3) Temporary Labor and Overtime Costs.
4) OSHA Fines.
5) Building and/or Vehicle Damage.
6) Equipment Damage.
7) Product/Material Damage.
8) Emergency Supplies.
9) Cleanup and startup of operations interrupted by an accident.
10) Cost of completing paperwork generated by the accident.
 PRODUCTION PLANNING AND CONTROL (PPC)
Meaning:-
Production planning and control is concerned with directing
production along the lines set by the planning department.
Definition:-
"Production planning and control is the co-ordination of series of
functions according to a plan which will economically utilize the
plant facilities and regulate the orderly movement of goods
through the entire manufacturing cycle from the procurement of
all materials to the shipping of finished goods at a
predetermined rate."
Hence, PPC is a tool to coordinate all manufacturing activities in
a production system.

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 CHARACTERISTICS OF
PRODUCTION PLANNING AND CONTROL
1. It is the planning and control of manufacturing process
in an enterprise.
2.Questions like-what is to be manufactured? when and how it is to
be manufactured? etc.
3.All types of inputs like materials, men, machines are
efficiently used for maintaining efficiency of manufacturing
process.
4.Various factors of production are integrated to use them
efficiently and economically.
5.The manufacturing process is organized in such a way
that none of the work centers is either overworked or
under worked.
6.The work is regulated from the first stage of procuring
raw materials to the stage of finished goods.

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 Need/Importance of Production Planning and Control
1. For Increasing Production:- The main purpose of
production planning, function is to arrange various inputs like
men, materials and machines and integrating them for making
their best use. When various factors of production are
economically used then production will certainly go up. Efforts
are made to avoid production stoppages for want of various
inputs. A production control Program will minimize the idleness
of men and machines.
2. For Co-coordinating Plant Activity: - Production
planning helps in controlling plant activities. Production targets
are set on the basis of sales forecasts. The raw materials, men
and equipment are arranged by keeping in view production
plans. Different production activities are adjusted as per the
plans. If production is carried out in a number of processes then
their activities are synchronized for smooth working.

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3. For Cost Control: - It helps in controlling various costs. In the absence of
a proper production plan, the idleness of men, material and equipment may not
be noticed. Whenever performance is below standards then corrective measures
are taken to rectify it. A properly planned system of production will help in
controlling costs by not only making full utilization of various inputs but also by
increasing output and lowering overhead expenses per unit.

4. For Rationalisation of Production Activities: - An important

objective of production planning and control is also to regulate the flow of
various inputs into the production system for running it smoothly. The system is
planned in such a way that everything is done automatically. The supply of
materials and men follows the demand for goods. The quality standards are
followed in routine and sub-standard products are discarded in the processes.
The process of entering of raw materials and converting them into finished
5. Consumers: - The consumer is ensured good quality goods. The process will
help in raising quality standards of products. The supply of goods is also prompt
and consumer has not to wait for them. Production schedules are prepared by
keeping in mind the requirements of consumers. The supplies are regulated for
meeting the demand for goods. The increase in production also helps the
consumer in getting sufficient supply of goods.

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 Techniques or Elements of
Production Planning and Control
The following are the techniques of production
planning and control:
A. Planning
B. Routing
C. Scheduling
D. Dispatching
E. Follow-up and Expediting
F. Inspection

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