This presentation presents a major problem and solution. Many companies have industrial engineers designing facility layouts in AutoCAD, but they don't have facility layout analysis tools. Therefore, facility layout IEs become AutoCAD drafters instead of engineers. Layout issues are hidden, and poor layouts are constructed. This applies to all countries, not only the Philippines.

1. Addressing the Strategic Facility Layout
Problem within SEIPI Member Companies
Robin Owens
Managing Director, Proplanner Asia
PSCECE 2012: Philippine Semiconductor and
Electronics Convention and Exhibition
22nd ASEMEP National Technical Symposium / ANTS
June 6-8, 2012

2. How many hundreds of millions of PHP
does your company have invested in its facilities
(production equipment, warehouses, offices, etc.)?
The Strategic Facility Layout Problem
Barrier to More Productive SEIPI Facilities

3. How many hundreds of millions of PHP
does your company have invested in its facilities
(production equipment, warehouses, offices, etc.)?
How does your company ensure that the
physical arrangement of the facilities
increases operational productivity?
The Strategic Facility Layout Problem
Barrier to More Productive SEIPI Facilities

4. • Process & Industrial Engineering
Software & Services
• Formed in 2002
• USA Headquarters
• Iowa State University Research Park
• Branched off from EDS PLM Solutions
• President: Dr. Dave Sly
• BSIE, MSIE, MBA, PhD IE
• Adjunct Professor – Iowa State
• Software Tools
• Facility Layout Analysis
• Time & Motion Study
• Assembly Line Balancing
• Process Planning
• Work Instructions – Static
• Work Instructions – Dynamic Shop Floor
• Electronic Kanban / Kitting
Proplanner
Background
Map of Proplanner Customers

5. • BSIE, MMM, MBA
• Penn State University
• Industrial Engineer
• American Express
• Empire Industries
• Boeing
• IE Consultant
• Engineering Animation Inc.
• Japan, Korea, Malaysia, USA
• Amkor Technology
• Philippines, Taiwan, China, USA
• Manufacturing Manager
• Amkor Philippines Test
• Intel Wafer Fab
• Smiths Medical
• Adjunct Professor
• Mapua Institute of Technology
“Advancing Facility Planning”
Published Article – November 2011
Industrial Engineer Magazine
Robin Owens
Background

6. SEIPI company leased new facility in Laguna,
and needed to relocate a camera chip assembly operation there.
The Strategic Facility Layout Problem
Barrier to More Productive SEIPI Facilities

7. A facility layout team (led by IE) created 3 different
facility layout drawings for management selection.
Layout Option 2 Layout Option 3Layout Option 1
The Strategic Facility Layout Problem
Barrier to More Productive SEIPI Facilities

8. Which one is the best, and should be implemented?
Layout Option 2 Layout Option 3Layout Option 1
The Strategic Facility Layout Problem
Barrier to More Productive SEIPI Facilities

9. KEY POINT: If you don’t measure the facility layouts,
then you have no basis for comparison and selection.
Layout Option 2 Layout Option 3Layout Option 1
The Strategic Facility Layout Problem
Barrier to More Productive SEIPI Facilities

10. The Strategic Facility Layout Problem
Barrier to More Productive SEIPI Facilities
Layout Option 2
KEY POINT: If you don’t measure the facility layouts,
then you have no basis for comparison and selection.
Layout Option 3Layout Option 1

11. One PHL semiconductor outsourcing manufacturer
spent P1.2 billion on factory, office, and warehouse layout changes
(over a period of 5 years),
without the use of industrial engineering tools
to measure and compare facility layout alternatives.
The Strategic Facility Layout Problem
Barrier to More Productive SEIPI Facilities

12. One PHL semiconductor outsourcing manufacturer
spent P1.2 billion on factory, office, and warehouse layout changes
(over a period of 5 years),
without the use of industrial engineering tools
to measure and compare facility layout alternatives.
This is the normal practice for
all SEIPI member companies
The Strategic Facility Layout Problem
Barrier to More Productive SEIPI Facilities

13. The Strategic Facility Layout Problem
Barrier to More Productive SEIPI Facilities
One PHL semiconductor outsourcing manufacturer
spent P1.2 billion on factory, office, and warehouse layout changes
(over a period of 5 years),
without the use of industrial engineering tools
to measure and compare facility layout alternatives.
This is the normal practice for
all SEIPI member companies
Think of how much more productive
SEIPI companies could be
if we used IE analysis tools
to improve facility layouts.

14. Why don’t SEIPI Industrial Engineers use software
to analyze and improve facility layouts?
The Strategic Facility Layout Problem
Barrier to More Productive SEIPI Facilities

15. Why don’t SEIPI Industrial Engineers use software
to analyze and improve facility layouts?
There are multiple reasons.
But, the key reason and root cause is the
lack of discussion of modern facility layout technology
in facility layout textbooks.
These textbooks focus on impractical algorithms
that are unused in industry.
The Strategic Facility Layout Problem
Barrier to More Productive SEIPI Facilities

16. • In the Philippines, most often, Facility
Layout IEs own the facility layout
drawings. Most layout drawings are in
AutoCAD.
• There are no IE analysis tools inside of
basic AutoCAD. AutoCAD is simply a
drafting / drawing tool.
The Strategic Facility Layout Problem
Facility Layout Practice in Industry

17. • In the Philippines, most often, Facility
Layout IEs own the facility layout
drawings. Most layout drawings are in
AutoCAD.
• There are no IE analysis tools inside of
basic AutoCAD. AutoCAD is simply a
drafting / drawing tool.
• Without using industrial engineering software, facility layouts are designed
(and billions of PHP spent) without measurement or IE analysis.
• Because of the perceived lack of layout engineering technology
available, facility layout IEs find themselves acting as AutoCAD drafters,
instead of industrial engineers.
The Strategic Facility Layout Problem
Facility Layout Practice in Industry

18. The Strategic Facility Layout Problem
Facility Layout Practice in Industry
• In the Philippines, most often, facility
Layout IEs own the facility layout
drawings. Most layout drawings are in
AutoCAD.
• There are no IE analysis tools inside of
basic AutoCAD. AutoCAD is simply a
drafting / drawing tool.
• Without using industrial engineering software, facility layouts are designed
(and billions of PHP spent) without measurement or IE analysis.
• Because of the perceived lack of layout engineering technology
available, facility layout IEs find themselves acting as AutoCAD drafters,
instead of industrial engineers.
Facility Layout IEs become
AutoCAD drafters, instead of engineers.
The result is that layout issues are hidden,
and inferior, inefficient facility layouts are
approved and constructed.

19. MovementMethods
Product&PartQuantities
MaterialMovement(from-to)
Data to Help
Determine
Trip Distance
Data to Help
Determine
Trip Cost & Time
The Strategic Facility Layout Problem
Facility Layout Practice in Industry – Useful Tools

20. The Strategic Facility Layout Problem
Facility Layout Practice in Industry – Useful Tools

21. The Strategic Facility Layout Problem
Facility Layout Practice in Industry – Useful Tools
Is this a good SBGA
Assembly layout?
How do you know?

22. The Strategic Facility Layout Problem
Facility Layout Practice in Industry – Useful Tools

23. The Strategic Facility Layout Problem
Facility Layout Practice in Industry – Useful Tools

24. The Strategic Facility Layout Problem
Facility Layout Practice in Industry – Useful Tools

25. Engineering
Results
Management
Results
The Strategic Facility Layout Problem
Facility Layout Practice in Industry – Useful Tools

26. The Strategic Facility Layout Problem
Facility Layout Practice in Industry – Useful Tools

27. The Strategic Facility Layout Problem
Facility Layout Practice in Industry – Useful Tools

28. The Strategic Facility Layout Problem
Facility Layout Practice in Industry – Useful Tools

29. The Strategic Facility Layout Problem
Facility Layout Practice in Industry – Useful Tools

30. The Strategic Facility Layout Problem
Facility Layout Practice in Industry – Useful Tools

31. The Strategic Facility Layout Problem
Facility Layout Practice in Industry – Useful Tools

32. The Strategic Facility Layout Problem
Facility Layout Practice in Industry – Useful Tools
Fast & Easy Wafer Bump Layout Results
12% reduction in Distance Traveled
3% reduction in Material Handling Cost
3% Reduction in Material Handling Time

33. The Strategic Facility Layout Problem
Facility Layout Practice in Industry – Useful Tools
Class 100,000
Class 10

34. The Strategic Facility Layout Problem
Facility Layout Practice in Industry – Useful Tools
Class 100,000
Class 10

35. The Strategic Facility Layout Problem
Facility Layout Practice in Industry – Useful Tools

36. The Strategic Facility Layout Problem
Facility Layout Practice in Industry – Useful Tools

37. The Strategic Facility Layout Problem
Facility Layout Practice in Industry – Useful Tools

38. The Strategic Facility Layout Problem
Facility Layout Practice in Industry – Useful Tools

39. The Strategic Facility Layout Problem
Facility Layout Practice in Industry – Useful Tools
This facility became a major
award winning operation,
partially due to the facility layout
analysis and planning performed
before the construction began.

40. Appendices
Additional Related Information
TOYOTA / BOEING KAIZEN,
SIMULATION,
RICHARD MUTHER’S SLP

41. • What other methods are used to improve facility layouts in the Philippines?
The Strategic Facility Layout Problem
The Toyota Method for Improving Facility Layouts

42. • What other methods are used to improve facility layouts in the Philippines?
• Toyota Motors is well-known as the best manufacturer in the world. This
includes Toyota Motor Philippines in Santa Rosa, Laguna.
• But, the Toyota Production System (i.e. - Lean Manufacturing) was
developed before personal computers were invented.
The Strategic Facility Layout Problem
The Toyota Method for Improving Facility Layouts

43. • What other methods are used to improve facility layouts in the Philippines?
• Toyota Motors is well-known as the best manufacturer in the world. This
includes Toyota Motor Philippines in Santa Rosa, Laguna.
• But, the Toyota Production System (i.e. - Lean Manufacturing) was
developed before personal computers were invented.
• You will find that Toyota embraces machine automation, but not industrial
engineering software. Toyota’s facility layout improvement methods are
manual and paper-based.
• We’ll review a Kaizen workshop example from the Boeing Commercial
Airplane Group in the USA, which was led by Shingijutsu (a Japanese
consulting company founded by some of the first Toyota executives to
develop Toyota’s Production System).
The Strategic Facility Layout Problem
The Toyota Method for Improving Facility Layouts

44. The Strategic Facility Layout Problem
The Toyota Method for Improving Facility Layouts
• The hard metals portion of an airplane parts factory was targeted for re-layout.
• Japanese Lean Mfg experts taught Boeing their official re-layout method,
performed their study, and recommended moving large, expensive equipment.

45. • This portion of the factory made
400+ different parts.
• Only 2 parts were selected for
analysis (minimum 0.5% of parts).
• The routing for these parts was
written down and then physically
followed.
• The path followed was scribbled
onto a piece of paper
(Spaghetti Chart), and then
used to estimate the material
flow distance traveled.
The Strategic Facility Layout Problem
The Toyota Method for Improving Facility Layouts

46. • This portion of the factory made
400+ different parts.
• Only 2 parts were selected for
analysis (minimum 0.5% of parts).
• The routing for these parts was
written down and then physically
followed.
• The path followed was scribbled
onto a piece of paper
(Spaghetti Chart), and then
used to estimate the material
flow distance traveled.
The Strategic Facility Layout Problem
The Toyota Method for Improving Facility Layouts

47. The Strategic Facility Layout Problem
The Toyota Method for Improving Facility Layouts
• This portion of the factory made
400+ different parts.
• Only 2 parts were selected for
analysis (minimum 0.5% of parts).
• The routing for these parts was
written down and then physically
followed.
• The path followed was scribbled
onto a piece of paper
(Spaghetti Chart), and then
used to estimate the material
flow distance traveled.
RESULT: This Spaghetti Chart analysis led Boeing
to recommend moving a massive Laser Mill
workcenter to the other side of the factory.
The construction and production delays, would have
cost Boeing well over $150k USD.
This would have happened.
But, a young & motivated IE got involved.

48. The Strategic Facility Layout Problem
An Alternative Method to the Toyota Spaghetti Chart
• The young IE introduced Flow Planner software (transforms AutoCAD into an IE facility layout
analysis tool), which he learned at Penn State University 5 years earlier.
• In 3 days (before the end of the Kaizen event), he ACCURATELY modeled and measured the
flow for ALL PARTS, and considered the various production quantities over the previous year.

49. • The young IE introduced Flow Planner software (transforms AutoCAD into an IE facility layout
analysis tool), which he learned at Penn State University 5 years earlier.
• In 3 days (before the end of the Kaizen event), he ACCURATELY modeled and measured the
flow for ALL PARTS, and considered the various production quantities over the previous year.
The Strategic Facility Layout Problem
An Alternative Method to the Toyota Spaghetti Chart

50. • The young IE introduced Flow Planner software (transforms AutoCAD into an IE facility layout
analysis tool), which he learned at Penn State University 5 years earlier.
• In 3 days (before the end of the Kaizen event), he ACCURATELY modeled and measured the
flow for ALL PARTS, and considered the various production quantities over the previous year.
The thicker the flow line,
the higher the flow
between 2 points
(measured down the
millimeter)
The Strategic Facility Layout Problem
An Alternative Method to the Toyota Spaghetti Chart

51. • The young IE found that moving the Laser Mill would have increased material handling
distance, cost, and time. The IE found that this was the wrong thing to do.
• Instead, he found 3 other workcenters that should be moved, and then performed that
analysis in 15 minutes using a computer and software.
The Strategic Facility Layout Problem
An Alternative Method to the Toyota Spaghetti Chart

52. L
L
B
B
I
I
C
C
E
E
Current Flow:
Proposed Flow:

53. L
L
B
B
I
I
C
C
E
E
Current Flow:
Proposed Flow:
Moving these 3 workcenters E, I, & B
(instead of the Laser Mill - L) would
reduce material flow by 30%, which
was 365 miles per year Euclidean.

54. L
L
B
B
I
I
C
C
E
E
Current Flow:
Proposed Flow:
In the end, Boeing did not move the
Laser Mill.
Also, the young IE was promoted to the
737 Final Assembly facility.

55. • SLP, Systematic Layout Planning (1961)
• Applies to any environment
• Relationship-based
• Thick lines = strong relationships
• Weighted factor layout scores
• Manual Method
• SHA, Systematic Handling Analysis (1969)
• Applies to any flow-centric environment
• Material flow-based
• Thick lines = intense material flow
• Weighted factor layout scores
• Manual Method
• Facilities Planning 2010 heavily supports
SLP and doesn’t mention SHA.
The Strategic Facility Layout Problem
Facility Layout Practice in Industry – Useful Concepts

56. • Though still applicable today, use of
Muther’s SLP and SHA methods in
industry is very low. These manual
methods are very time consuming, and
cannot handle large amounts of data.
• Lean Manufacturing: measure the
process before making a change.
• How to measure & compare facility layout alternatives (without layout
engineering tools, and with limited time)? Lean spaghetti chart?
Dynamic simulation (DES)?
• Facility layout IEs in industry require tools to visualize & measure layout
relationships (flow and non-flow), to support evaluation & team
discussion.
The Strategic Facility Layout Problem
Facility Layout Practice in Industry – Useful Concepts

57. Value Closeness
A Absolutely Necessary
E Especially Important
I Important
O Ordinary – Closeness OK
U Unimportant
X Not Desirable
• Automated Muther’s SLP (inside of
AutoCAD) permits IEs to use this method
quicker & more frequently.
• Automated scoring and diagramming
tools drastically reduce the time required
to perform a study.
The Strategic Facility Layout Problem
Facility Layout Practice in Industry – Useful Tools

58. • Dynamic Simulation
• Model the performance of a system as it
changes over time (4 pages of content).
• Variables change during the day
(e.g. – arrival rate of jobs, number of jobs
in process, waiting time for resources).
• Complex data and models. Random number
generation and probability distributions.
Time consuming data, modeling, validation.
• Stochastic: queuing models, throughput
and WIP analysis, detailed capacity analysis.
• Facility Layout: Possible for use. Lengthy &
costly. Re-build the facility layout (duplicate
effort). Create & build logic for model.
• Static Simulation
• Model the performance of a system over a
fixed period of time (1 page of content).
• Variables are not time based
(e.g. – equipment location, unloading time
for a forklift, tasks assigned to a station).
• Simple data and models. No random
numbers or probability distributions.
Quick data, modeling, validation.
• Deterministic: facility layout, material
handling analysis, assembly line balancing.
• Facility Layout: Global standard for use. Utilize
the data within the AutoCAD layout design.
Commercial software exists for this function.
The Strategic Facility Layout Problem
Static Simulation is More Appropriate

59. • 16 industrial engineering schools are customers (including all CHED
schools). Our long-term vision of facility layout improvement in the
Philippines starts with the universities.
• Let’s begin to engineer facility layouts, instead of just drawing them.
• If your company is building a new facility, or re-laying out an existing
facility, then it is very important to properly evaluate the new design(s).
• Contact us to learn more:
• Presentation / Demonstration
• Software
• Training
• Consulting
The Strategic Facility Layout Problem
Call to Action

60. Stand-alone Software Tools:
• Facility Layout
• Time & Motion Study
• Assembly Line Balancing
Call:
(+63) 49-801-5691 or 0922-849-3948
Email:
robin@proplanner.com
Parent Website:
www.proplanner.com
LinkedIn:
http://ph.linkedin.com/in/proplannerasia
Proplanner Asia
Contact Information