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Operations Management Question

Discuss the strategic importance of layout decisions. How can a particular layout impact a company's strategic goals? Provide some specific examples from industry.

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The objective of layout strategy is to develop an economic layout that will meet the firm's competitive requirements

Layout decisions ultimately result t:
a. Higher utilization of space, equipment, and people
b. Improved flow of information, materials, or people
c. Improved employee morale and safer working conditions
d. Improved customer/client interaction, and
e. Flexibility

The following are some important factors, which influence the planning of effective layout to a significant degree.

1. Nature of the product: The nature of the product to be manufactured will significantly affect the layout of the plant. Stationary layout will be most suitable for heavy products while line layout will be best for the manufacture for the light products because small and light products can be moved from one machine to another very easily and, therefore, more attention can be paid to machine locations can be paid to machine locations and handling of materials.

2. Volume of production: Volume of production and the standardization of the product also affect the type of layout. If standardized commodities are to be manufactured on large scale, line type of layout may be adopted.

3. Basic managerial policies and decisions: The type of layout depends very much on the decisions and policies of the management to be followed in producing the commodity with regard to the size of plant, kind and quality of the product, scope for expansion to be provided for, the extent to which the plant is to be integrated, amount of stocks to be carried at anytime, the kind of employee facilities to be provided etc.

4. Nature of plant location: The size shape and topography of the site at which the plant is located will naturally affect the type of layout to be followed in view of the maximum utilization of the space available .For e.g., if a site is near the railway line the arrangement of general layout for receiving and shipping and for the best flow of production in and out the plant may be made by the side of the railway lines .If space is ...

Solution Summary

The expert discusses the strategic importance of layout decisions are examined. How the particular layout impacts a company's strategic goals are determined.

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