Agriculture Reference
In-Depth Information
products may prevent this option. A distinct difference between manufacturing and service
is that services are typically produced and consumed simultaneously. Thus, service fi rms
must build enough capacity into their facilities to meet peak periods of demand. For exam-
ple, a supermarket must have enough checkout counters to meet not only average demand
but also for peak demand periods (such as the week before Thanksgiving). Of course, service
fi rms can shift or smooth out demand by altering consumer behavior. Offering discounts or
other incentives during off-peak hours are some ways that are used to shift consumer
demand.
Multiple shifts vs. single shifts
Multiple shifts
may be an alternative to operating a facility at maximum capacity—if the
labor is available. Theoretically, it is possible to produce twice as much in a plant with
double shifts, while limiting the need for space by spreading out the working hours.
Agricultural-chemical companies require multiple shifts because of the chemical nature of
their products and large investments in equipment. Likewise, corn and soybean processing
facilities typically run 24 hours a day, seven days a week—stopping only for emergencies or
routine maintenance. In plants where this is not the case, managers must carefully evaluate
the costs of a larger facility versus the increased costs of sometimes less productive and
possibly more accident-prone labor.
Layout planning
Layout planning
refers to the specifi c design of the physical arrangement within a facility.
When planning the physical layout of a plant, consideration must be given to utilize space
and labor effectively, minimize material handling, and maintain fl exibility for future changes
in product or demand. The goal of layout planning is to allow both the workers and equip-
ment to run the operation in the most effi cient and effective manner. There are four basic
categories of facility layout:
1.
Process
2.
Product
3.
Hybrid
4.
Fixed position
Process layout
A
process layout
arranges activities by function. Thus in a process layout, regardless of
the product being created or assembled, all like functions are grouped in the same
place—that is, canning equipment with canning equipment, inspectors with inspectors,
etc. The process layout is common where different goods or services are produced
intermittently to serve different customers (
Figure 14.2
). As a result, general resources
and equipment are utilized to make the process layout more fl exible to changes in
product mix or marketing strategies. Disadvantages of the process layout include slower
overall processing rates (because of the switching between products), higher levels of
inventory, increased time lags between specifi c operations, and higher costs for material
handling.
