Layout

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The basic meaning of facility is the space in which business activities take place. It’s how resources are positioned relative to each other and how various tasks are allocated to these resources. There are two basic types of layout- Product layout and process layout. Product layout- In this type of layout, equipment, tools, and machines are located according to how a product is made. So for a company that manufactures multiple products, each product will have its own layout without any interference from other products. Process layout- This type of layout is commonly seen in facilities that perform custom jobs like in a job shop or batch process. For example, in a cake shop, equipments are placed in a jumbled order and each cake has to go through a series of steps such as mixing the batter, baking, icing, sprinkling chocolate chips..mmm yumm chocolate chips.. Sorry I got carried away. The point is that each cake is made as per the customer’s demand.

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Description

Layout can be classified into two types-

1. Product Layout

2. Process Layout

Product Layout

A product layout groups different workstations together according to the products they work on. In this type of layout, equipment, tools, and machines are located according to how a product is made. This is also referred to as assembly line/continuous flow where products are passed down the line from station to station as they are being made. This setup is more desirable for standardised products that can be manufactured in a large quantity.

Example - At LG TV manufacturing plants, each unit moves on a conveyor belt from one station to another for assembly.

Product or Line Layout

Process Layout

In a process layout same types of functions are grouped together and product moves from one function to the other. This setup is more desirable for customised products that need not be produced in a large quantity.

Example - At McDonald's, each function has a fixed space. The billing counter, store room, drive through, oven, fryer, coffeemaker, etc. - each function is located at a fixed place and the employee goes to the relevant station in order to fulfill customers' orders.

Process or Functional Layout

Key Takeaways

1. A shop floor layout will be designed on the basis of the goods or services that are to be processed there.

2. For standardized, large volume products, a product layout is typically preferred for fast movement of the goods. For customized products which are churned out in low volume, a process layout would be more effective.

Commonly Asked Interview Questions

What are the different types of layouts? Is any one type better than the other?

Up Next

In the next chapter, learn about two other operations strategies - Make-to-Stock and Make-to-Order

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