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Chapter 8. Infrastructure: Technology and Facilities

Chapter 8. Infrastructure: Technology and Facilities. Outline Technology Services and Manufacturing Technology Decision Making Break Even Analysis Facilities Decision Making Facility Location and Facility Layout Ergonomic Issues Facility Design - Systematic Layout Planning. Technology.

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Chapter 8. Infrastructure: Technology and Facilities

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  1. Chapter 8. Infrastructure: Technology and Facilities • Outline • Technology • Services and Manufacturing • Technology Decision Making • Break Even Analysis • Facilities Decision Making • Facility Location and Facility Layout • Ergonomic Issues • Facility Design - Systematic Layout Planning MAN 3504 - Chapter 8

  2. Technology • Dominates products and processes. • Used in services and manufacturing • Services • Share/analyze information: EDI, Decision Making Systems • Internet based commerce • Manufacturing • CAD/CAM, Automated Guided Vehicles • Scheduling and Capacity Planning Systems MAN 3504 - Chapter 8

  3. Technology Decision Making • Advantages of new technology • Cost reduction: Labor, Material, quality • Increased Flexibility: manage customer inputs, simplify customization • Higher Quality: better features, more process control • Increased delivery and development speed: CAD and internet • Risks of new technology • Customers or employees reject new technology • Technology obsolescence MAN 3504 - Chapter 8

  4. Technology Decision Making - Break even analysis • A tool to support selection of technology alternatives • Determine payoff line for each alternative • Pi (W) = (Ri – VCi) x W – Fi Where Pi (W) = Profit for alternative i given a demand W. Ri = Revenue generated per item for alternative i. VCi = Variable cost per item for alternative i. Fi = Fixed cost for alternative i. W = Number of items. MAN 3504 - Chapter 8

  5. Facility Decision Making • Two types: facility location and facility layout • Facility Location decisions: multiple factors are considered: • Proximity to customers • Labor/Skill availability • Proximity to key suppliers, to existing facilities, to ports and airports • Taxes and incentives, Political stability • Factor Rating Method: simple tool to help decision making MAN 3504 - Chapter 8

  6. Facility Decision Making • Facility Layout Decisions • Three types of layouts: Product, Process, and Cellular • Product • Layout follows the process required by a single (or very few) product(s) MAN 3504 - Chapter 8

  7. Facility Decision Making - Layouts • Process • Layout is organized by functional areas. • Used for multiple products that require different flows MAN 3504 - Chapter 8

  8. Facility Decision Making - Layouts • Cellular • Layout is organized by product families. • Objective: combine the advantages of the process and product layouts MAN 3504 - Chapter 8

  9. Ergonomic Issues of Facility DM Ergonomics: Study of the interaction between humans and machines/equipment/tools • Work area dimensions (space, location of the equipment) • Force requirements (easy to move, weight of material that must be moved) • Noise (limit communication, hearing damage) • Lighting (vision fatigue) • Displays (easy to read/understand) • Controls (location, complexity) • Speed of work (stress) MAN 3504 - Chapter 8

  10. Facilities Decision Making: Systematic Layout Planning • A Process to develop process layouts 1. Determine the functional groups 2. Determine the relationships between areas 3. Create a relationship diagram 4. Create a layout without dimensions 5. Create a layout with dimensions 6. Score the layout 7. Go back to steps 4-6 and try to create a new layout with a higher score MAN 3504 - Chapter 8

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