operation management layout

AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

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MBA, Semester 2 Operations Management Ms. Aarti Mehta Sharma

AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

Facility Layout

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AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

Facilities Layout
The configuration of departments, work centers, and equipment, with particular emphasis on movement of work (customers or materials) through the system • This could be for new plants or could be • Improvements in layouts already in use to introduce new methods and improvements in manufacturing procedures.
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AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

Importance of Layout Decisions
• Requires substantial investments of money and effort • Involves long-term commitments • Has significant impact on cost and efficiency of operations
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AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

Objectives of a good layout
• • • • • • • • • • • • Provide enough production capacity Reduce material Handling costs Reduce Congestion Reduce accidents / hazards to personnel Utilize labor efficiently Provide for volume and product flexibility Provide ease of supervision Allow ease of maintenance Allow high machine / equipment utilisation The arrangement should be congruent with the flow of materials Sequence of equipments In addition to floor space, the vertical space should also be considered.
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AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

Costs
• • • • • • • Cost of movement of materials from one work area to another 6 Cost of space Cost of production delays, if any. Cost of spoilage of materials Cost of labor dissatisfaction and health risks Cost of changes, if any Cost of customer dissatisfaction due to poor service

AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

Basic Layout Types
• Product layouts • Process layouts • Fixed-Position layout • Cellular Manufacturing • Combination layouts
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Bangalore

• Product layout – Layout that uses standardized processing operations to achieve smooth, rapid, high-volume flow • Suitable for assembling operations eg. Automobile industry • No. of equipment large • Volume of production large • Variety of products is low ; Two products ---- two product layouts • Flow of materials • Sequence of equipments

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AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

Product Layout
Raw materials
Material and/or labor Station 1 drilling Material and/or labor Station Station 22 machining machining Material and/or labor
Heating Heating

Station Station 33

Painting Painting

Station Station 44

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Finished item

Material and/or labor

Used for Repetitive or Continuous Processing

AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

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AM ITY GLOBAL BUSINESS SCHOOL

Wine mfg

Bangalore

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AM ITY GLOBAL BUSINESS SCHOOL

Pizza

Bangalore

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AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

Advantages of Product Layout
• • • • • • • High rate of output Low unit cost Labor specialization not high Low material handling cost High utilization of labor and equipment Established routing and scheduling Routing accounting and purchasing
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AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

Disadvantages of Product Layout
• Creates dull, repetitive jobs • Poorly skilled workers may not maintain equipment or quality of output • Fairly inflexible to changes in volume • Highly susceptible to shutdowns • Needs preventive maintenance • Individual incentive plans are impractical
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AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

Process Layout / Job Shop production
• • • •
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Equipment performing similar functions is grouped together Volume of manufacturing is low Variety of products ( each customer is unique) Example : Customised Cars

AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

Process Layout
Drilling

Process Layout (functional Heati )
ng

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Painting

Casting

Machining

Packaging

Used for Intermittent processing Job Shop or Batch

AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

Process Layout
Milling
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Assembly & Test

Grinding

Drilling

Plating

Process Layout - work travels to dedicated process centers

AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

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AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

222 444

Mill

Drill
1111 222 2

22 22 2

222 111 444
3 33 33 33 33

222

19

Grind

3333

111

33 33 33

111333

Assembly
111 444

4 44 44

333Lathes

Heat treat

111

Gear cutting

Exhibit GLOBAL AM ITY 8.2 BUSINESS SCHOOL

Process Layout for a Machine Shop
Bangalore

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AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

Advantages of Process Layouts
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• • • •

Can handle a variety of processing requirements Not particularly vulnerable to equipment failures Equipment used is less costly Possible to use individual incentive plans

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Disadvantages of Process Layouts
In-process inventory costs can be high Challenging routing and scheduling Equipment utilization rates are low Material handling slow and inefficient Complexities often reduce span of supervision Special attention for each product or customer Accounting and purchasing are more involved

Bangalore

• • • • • • •

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AM ITY GLOBAL Fixed BUSINESS SCHOOL

Position Layout

Bangalore

• The position of product is fixed • Tools, Men and materials come to the product • Manufacture of Large products such as locomotives, boilers, ships, hospital etc

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Bangalore

Advantages
• Men and machines can be used for a wide variety of operations 24 producing different products • Investment on layout is very small • Worker identifies himself with the product and feels pride in it. • Cost and difficulty of transporting a bulky product is avoided

AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

Cellular Layouts
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– –

Layout in which machines are grouped into a cell that can process items that have similar processing requirements The grouping into part families of items with similar design or manufacturing characteristics A complete product or part of a product is manufactured

AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

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AM ITY GLOBAL BUSINESS SCHOOL

Bangalore



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AM ITY GLOBAL Process Flows BUSINESS SCHOOL

before the Use of GT Cells Bangalore

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AM ITY GLOBAL Process Flows BUSINESS SCHOOL

after the Use of GT Cells Bangalore

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AM ITY GLOBAL BUSINESS SCHOOL

One worker cell
Machine 2

Bangalore

Machine 1

Machine 3

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Materials in

Finished goods out Machine 5 Machine 4

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Bangalore

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AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

Advantages
• • • • Key enabler of increased production velocity and flexibility 32 The reduction of capital requirements. Reduction of over production Products move through the manufacturing process one-piece at a time, at a rate determined by customers' needs • Shifts worker responsibilities from watching a single machine, to managing multiple machines in a production cell.

AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

Service facility Layout
• Service facilities exist to bring together customers and facilities 33 ( banks, hospitals ). • Banks are designed around customer receiving and servicing • Hospitals are designed around technology( X ray / radiology / pathology machines), processing of patients (receiving patients, settling accounts ) and operation efficiency ( surgery, gynecological, patient recovery). • Easy entrance and parking space are an essential requirement • Process Layout

AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

Arrangement of other facilities
• Receiving Department - raw materials (vendor oriented services) • Shipping Department - finished goods are delivered to customers End of the plant • Store room - raw materials, finished goods, partly finished goods and supplies are stored - close to the production centre
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• Inspection - of purchased material (raw materials, parts,supplies) - of work in process - of finished groups At every stage, every department • Maintenance - of machinery / building - heating / air conditioning - machine and equipment installation - safety devices / fire protection - collection and disposal of waste / garbage / refuse

Bangalore

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AM ITY GLOBAL BUSINESS SCHOOL
• Employee Facilities - time clocks - toilets - drinking water - cafeteria - safety measures • Other Facilities - power generators - water filters - chilling plant ( close to the boiler room )

Bangalore

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AM ITY GLOBAL BUSINESS SCHOOL
• • • • • •

Planning

Bangalore

By in house engg or planning department 37 Depends upon the product Depends upon volume Determine process Determine flow of materials Decide upon equipment( also for material handling) and work centres • Determine storage requirement

AM ITY GLOBAL BUSINESS SCHOOL
• • • • • • Decide upon labor – direct / indirect Draw building specifications, floor plan Preparation of detailed layout planning Approval from Management Preparation of work schedule Construction starts

Bangalore

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AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

Tools and Techniques
• • • • • • Templates Line Balancing Analysing with Computers Travel chart method Load Distance method Systematic Layout Planning
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Load distance Bangalore analysis method

• For comparison of alternative layouts 40 • Multiply actual distance moved and load (units) • Try to minimize the same Illustration • Two layouts A and B are given • Data consists of the facility's products, distance between depts. and travel between depts. • Determine the best layout

AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

Layout A 8 3 4 7 10 1 9 2 2 9 6 5 5 6 3 8
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Layout B 7 1 4 10

AM ITY GLOBAL BUSINESS SCHOOL
Dept. movement
combination

Bangalore

Dist bet dept(ft) Dept A 30 10 10 10 10 20 10 40 B 30 10 10 10 10 20 10 10

movement
combination

Dist bet dept (ft) A 30 30 10 10 10 10 20 20 B 20 30 10 10 10 10 50 30
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1–5 1–7 1–9 1 - 10 2–5 2–6 2 – 10 3-6

3–9 4–5 4–7 4 – 10 5–6 6–9 7–8 8 - 10

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Products Department Processing Sequence

Bangalore

No. of products processed per month
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A B C D E F

1-5-4-10 2-6-3-9 2-10-1- 9 1-7-8-9 2-5-6-9 1-7-4-10

1000 2000 3000 1000 2000 4000

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Product Load / pm Distance per product Load * Distance Layout A Layout B Layout A

Bangalore

Layout B

A B C D E F Total

1000 2000 3000 1000 2000 4000

70 90 30 50 30 30

70 50 30 90 30 30

70,000 1,80,000 90,000 50,000 60,000 1,20,000 5,70,000

70,000 1,00,000 90,000 90,000 60,000
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1,20,000 5,30,000

AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

Systematic Layout Planning
• Service facilities • Material flow not critical • Develop a “relationship chart” / Richard Muther’s half – matrix / fish diagram • Chart rates the relative importance of locating one dep't close to another • Ratings are indicated by code letters a,e,i,o,u,x • Developed by trail and error
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Reasons (optional)

Bangalore

Code 1 2 3 4 5 6

Reason Type of customer Ease of supervision Common personnel Contact necessary Share same space psychology

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AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

Value A E I O U X

Closeness Absolutely Necessary Especially Important Important Ordinary Unimportant Undesirable

Line code
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AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

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AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

Nearness Diagram
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Credit Toy Wine Camera Candy

AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

5 1

2

4
50

3

AM ITY GLOBAL Assembly BUSINESS SCHOOL

line balancing

Bangalore

• Typically, sequence of tasks required to assemble a product is 51 dictated by its design. • For many assemblies that consist of a large number of tasks, there are a large number of ways to group tasks together into individual workstations while still ensuring the proper sequence of work. • Assembly line balancing is a technique to group tasks among workstations so that each work-station has, ideally, the same amount of work.

AM ITY GLOBAL Assembly BUSINESS SCHOOL

line balancing

Bangalore

• Example: if it took 90 seconds to assemble a pen, and the work 52 was divided evenly among three workstations, then each workstation would be assigned 30 seconds of work content per unit. Basic assumptions: • No idle time per workstations; and the output of the first workstation immediately becomes input to the next workstation. • In the current example, there are no bottleneck workstations, and the flow of pens through the line is continuous.

AM ITY GLOBAL Assembly BUSINESS SCHOOL

line balancing

Bangalore

• Objective of assembly line balancing is to minimize the 53 imbalance among workstations while trying to achieve a desired output rate. • So either, one can minimize the number of workstations for a given production rate or maximize the production rate for a given number of workstations. • Though typically carried out at the design stage of the assembly line, line balancing is also required whenever there is a change in product design and/or new product introduction.

AM ITY GLOBAL Assembly BUSINESS SCHOOL
• 1.

line balancing

Bangalore

Input for assembly line balancing: 54 A set of tasks to be performed and the time required to perform each task 2. The precedence relations among the tasks- that is, the sequence in which tasks must be performed, and 3. The desired output rate or forecast of demand for the assembly line. • • The first two requirements can be obtained from the product design documents The third one is specified by the management.

AM ITY GLOBAL Assembly BUSINESS SCHOOLline

balancing: Example Bangalore

• An activity consisting of three tasks: A, B and C. ? Task A is first, and takes 0.5 minutes ? Task B is next, and takes 0.3 minutes ? Task C is the last, and takes 0.2 minutes. • Since, all the tasks must be performed to complete one part, total time required to complete one part is 0.5+0.3+0.2 = 1 minute.

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AM ITY GLOBAL Assembly BUSINESS SCHOOLline

balancing: Example Bangalore

• Suppose that one worker performs all three tasks (sequentially). 56 • Then in an 8-hour shift, the worker could produce – 480 parts/day.

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Line Balancing Bangalore
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• • • •

Assembly line study Equally divides the work among workers No. of employees is minimised Most common is a moving conveyor that passes a series of work stations in a uniform time interval called workstation time cycle • Assembly line balancing is the assigning of tasks to a series of workstations in such a manner that each workstation has no more than can be done in the work station time • Idle time across all workstations is minimized

AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

• Precedence relationship : the order in which tasks must be 58 performed in the assembly process. • Precedence Diagram : circles represent tasks; arrows indicate the order of task performance • Workstation cycle time : = production time per day reqd output per day (in units) • Nt (no. of workstations) = sum of task times cycle time

AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

• Assign tasks to workstation 1, 2, 3 …. • Na = actual no. of workstations • Efficiency (idle time is minimised) = sum of task times(T) no. of workstations(Na) × workstation cycle time

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AM ITY GLOBAL BUSINESS SCHOOL

Illustration

Bangalore

• The Model J Wagon is to be assembled on a conveyor belt. 500 wagons are required per day. Production time per day is 420 minutes, and the assembly steps and times for the wagon are given in the table. Find the balance that minimizes the number of workstations, subject to cycle time and precedence constraints.
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AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

ASSEMBLY STEPS AND TIMES FOR MODEL J WAGON

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AM ITY GLOBAL BUSINESS SCHOOL Task Task Description
Time

Bangalore Tasks that must precede

A B C D E F G H I

45 11 9 50 15 12 12 12 12

Position rear axle Hand fasten four screws to nuts Tighten rear axle Position front axle Tighten front axle Position rear wheel # 1;fasten hubcap Position rear wheel # 2;fasten hubcap Position rear wheel # 3;fasten hubcap Position rear wheel # 4;fasten hubcap Position wagon handle shaft on front axle assemby Tighten bolt and nut

A B D C C E E

62

J K

8 9 195

F,G,H,I J

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Precedence Graph Bangalore
F
63

• A

B

C G

D

E

H I

J

K

AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

C = production time per day = 60 s * 420 min = 50.4 output per day 500 Convert to seconds as task time is in seconds Minimum no. of workstations required = 195 / 50.4 = 3.87 = 4

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Task Station 1 Station 2 Station 3 A D B C F G Station 4 E H I J Station 5 K Task time 45 50 11 9 12 12 15 12 12 8 9

Remaining time 5.4 idle 0.4 idle 39.4 30.4 18.4 6.4 35.4 23.4 11.4 3.4idle 41.4 idle

Bangalore

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AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

• Efficiency = T = 195 = 0.77 NaC 5 * 50.4 77 %

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AM ITY GLOBAL BUSINESS SCHOOL
• • • • • • • • • •

Quality of a good layout

Bangalore

Minimise materials handling cost Effective use of available area Minimisation of production delays Improved Quality Control / Avoidance of unnecessary and costly changes Minimum Equipment Investment Avoidance of bottlenecks Better production control Better Supervision Improved utilisation of labor Improved Employee Morale

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AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

2. A company wants to add a new wing to its present 68 manufacturing shop to manufacture certain products. The two alternative layouts being considered are as below : LAYOUT A 1 2 4 5 6 3 7 LAYOUT B 2 5 6 3 1 4 7

AM ITY GLOBAL BUSINESS SCHOOL
Trips between departments 1–2 1–3 1–4 2–3 2–4 3–4 4–5 5–6 5–7 6-7

Distances between Departments Layout A 24 24 38 44 30 44 50 50 50 40 Layout B 50 30 46 20 72 52 40 44 60 40

Bangalore

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AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

Sequence of processing is given below. Use load distance analysis to determine best layout

Products P1 P2 P3 P4 P5

Sequence 1-2-3-4-5-6-7 1-2-4-5-6-7 1-3-4-5-6-7 1-3-4-5-7 1-4-5-6-7

Batch size 1400 200 1200 300 200

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AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

3. Arrange six departments 1,2,3,4,5 and 6 in the facility

outline shown below so that the nearness priorities shown in the TABLE are satisfied.

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AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

Deptt 1. Reception 2.X Ray 3. Surgery 4.Examining rooms 5.Lab 6. Nurses station

2

3

4 200 300 100

5 0 0 0 0

6 10 8 400 15 3
72

500 5 10

AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

73

Department 1 Department 2 Department 3 Department 4 Department 5 Department 6

AM ITY GLOBAL BUSINESS SCHOOL
4.

Bangalore

X Agri products is planning to set up a regional warehouse in north eastern Maharashtra. M/s Shivajirao & Co..M/s Patil74 Farms,M/s Aras & Brothers, and M/s Jambhekar &Co. are its main clients in that area. The business volume with the above four is roughly in the ratio 5:4:3:2 . The distances of the clients from Lakshmipur, a town in that area : Shivajirao 50 km North Patil 100 km North east Aras 75 km South West Jambhekar 45 km east Where, wrt Lakshmipur, should X Agri Poducts locate their warehouse ?

AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

5. Manufacturing Engineers at Suny Manufacturing were working on a new remote controlled Monster Truck. They hired a production consultant to help them determine the best type of production process to meet the forecasted demand fo this new product. The consultant recommended that they use an assembly line that will produce 600 Monster Trucks per day to meet the demand forecast.
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AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

The workers of the plant work 8 hours per day. The task information for the new Monster Truck is given in the table :

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AM ITY GLOBAL BUSINESS SCHOOL
Task A B C D E F G H I J K Total 28 13 35 11 20 6 23 25 37 11 27 236

Task Time(in secs) Preceding Tasks

Bangalore

B A C D,E F F G G,H I,J

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AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

• Draw the precedence diagram • What is the reqd cycle time ? • Calculate Nt and Na

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AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

• C= 60 * 480 / 600 = 48 s • Nt= 236 /48 = 4.92 = 5 • Na = 6

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