Facilities Planning（p3-p6）

James A. Tompkins

Introduction

Facilities planning has taken on a whole new meaning in the past 10

years. In the past, facilities planning was primarily considered to be a science. In today's competitive global marketplace, facilities planning is a strategy. Governments, educational institutions, and businesses no longer compete against one another individually. These entities now align themselves into cooperatives, organizations’ associations, and ultimately synthesized supply chains, to remain competitive by bringing the customer Into the process.

The subject of facilities planning has been a popular topic for many years. In spite of its long heritage, it is one of the most popular subjects of current publications, conferences, and research. The treatment of facilities planning as a subject has ranged from checklist, cookbook-type approaches to highly sophisticated mathematical modeling. In this text we employ a practical approach to facilities planning, taking advantage of empirical and analytical approaches using both traditional and contemporary concepts. It should be noted that facilities planning, as addressed in this text, has broad applications. For example, the contents of this book can be applied equally to the planning of a new hospital, an assembly department, an existing warehouse, or the baggage department of an airport. Whether the activities in question occur in the context of a hospital, production plant, distribution center, airport, retail store, school，bank, office, or any portion of these facilities, or whether in a modem

facility in a developed country or an outdated facility in an emerging country, the material presented in this text should be useful in planning. It is important to recognize that contemporary facilities planning considers the facility as a dynamic entity and that a key requirement for a successful facilities plan is its adaptability and its ability to become suitable for new use.

Facilities Planning Defined

The facilities we plan today must help an organization achieve supply

chain excellence. Supply chain excellence is a process with six steps, or levels. These steps are business as usual, link excellence, visibility，collaboration, synthesis, and velocity.

Business as usual is when a company works hard to maximize the individual functions of the supply chain (buy-make-move-store-sell). The goal of individual departments, such as finance, marketing, sales，purchasing, information technology. research and development, manufacturing, distribution, and human resources, is to be the best department in the company. Organizational effectiveness is not the emphasis. Each organizational element attempts to function well within its individual silo.

Only after one’s link achieves performance excellence can he or she begin to pursue supply chain excellence. To achieve link excellence，companies must tear down the internal boundaries until the entire organization functions as one. Companies usually have numerous departments and facilities, including plants, warehouses, and distribution centers (DCs). If an organization hopes to pursue supply chain excellence, it muse look within itself, eliminate and blur any boundaries between departments and facilities, and begin a never-ending journey of

continuous improvement. It must have strategic and tactical initiatives at the department, plant, and link levels for design and systems.

Supply chain excellence requires everyone along the supply chain to work together. Everyone in the supply chain cannot work together, however, if they cannot see one another. Visibility, the third level of supply chain excellence, brings to light all links in the supply chain. It minimizes supply chain surprises because it provides the information links needed to understand the ongoing status. It could be considered the first real step toward supply chain excellence.

Through visibility, organizations come to understand their roles in a supply chain and are aware of the other links. An example is an electronics company with a Web site that allows its customers to view circuit boards and then funnels information about those customers to suppliers. Visibility thus requires sharing information so that the links understand the ongoing order status and thus minimize supply chain surprises.

Once a supply chain achieves visibility, it can move to collaboration，the fourth level of supply chain excellence. Thorough collaboration. the supply chain can determine how best to meet the demands of the marketplace. The supply chain works as a whole to maximize customer satisfaction while minimizing inventories. Collaboration is achieved through the proper application of technology and true partnerships. Various collaboration technologies exist, and. as with visibility software, the supply chain must choose the right technology or combination of technologies if it hopes to collaborate properly. True partnerships require total commitment from all the links in the supply chain and are based on trust and a mutual desire to work as one for the benefit of the supply chain.

After collaboration is in place, the supply chain then must pursue the

continuous improvement process of synthesis. Synthesis is the unification of all supply chain links to form a whole. It creates a complete pipeline from a customer perspective. The results of synthesis are as follows：

? Increased ROA. This is achieved by maximizing inventory turns, minimizing obsolete inventory, maximizing employee participation, and maximizing continuous improvement.

? Improved customer satisfaction. This is achieved because synthesis creates companies that are responsive to the customer's needs through customization.

They understand value-added activity. They also understand the issue of flexibility and how to meet ever-changing customer requirements. They completely comprehend the meaning of high quality and strive to provide high value.

? Reduced costs. This is achieved by scrutinizing transportation costs, acquisition costs, distribution costs, inventory carrying costs, reverse logistics costs, packaging costs，and so on and continually searching for ways to drive down the total delivered — to — customer cost.

? An integrated supply chain. This is achieved by using partnerships and communication to integrate the supply chain and focus on the ultimate customer.

Synthesis is not achieved overnight. It takes time to take the links of a supply chain and remove the boundaries between them. However，if all links are visible and all collaborate，then synthesis is within reach.