A study on layout design for a logistic center – Case study at ASSA ABLOY Opening Solutions Sweden AB

Abstract: Most organizations understand that in order to progress in a market that is dominated by competition, they must identify practices that can lead to improvements and obtaining competitive advantages. As a way to drive improvements, it has led to the link between layout planning and supply chain management receiving growing awareness. Due to modern facilities laying the foundation for organizations in order to achieve supply chain excellence and competitive advantages, layout planning is starting to play a more influential part for companies. ASSA ABLOY Opening Solutions Sweden AB's (ASSA ABLOY OS) facility in Eskilstuna is currently in a transitional phase where they are planning on moving the current distribution center and certain warehouse operations to a third-party logistics solution in Gothenburg. In conjunction with this move, a smaller logistic center will be developed and operate instead. Unlike the distribution center that stores and manages several products related with opening solutions, whilst operating in a substantial area, the new logistic center will only store and manage components related with mechanical locks and cylinders, leading to the remaining operations operating in a significantly reduced area. The purpose of this study was therefore to investigate how to develop an optimal layout design for a logistic center. The study will include identifying potential methods that can be used in order to identify existing wastes, improvement areas, as well as to developing a deeper understanding regarding how to design a layout. The aim of the study will lastly be to present recommendations and a suggestion for a future layout, based on scientific theories and empirical findings. The Value Stream Mapping (VSM) method has been used in order to conduct a current state analysis, involving the identification of wastes that can be eliminated in the future layout, as well as improvement areas that can be implemented. Additionally, The Systematic Layout Planning (SLP) method has been used in order to develop a deeper understanding regarding the importance of closeness between the separate operations and workstations, which would feature within the future logistic center. The application of SLP in the development of the new layout led to the forming of alternative layouts for the case company, were each layout consisting of a rearrangement of the operations and workflows, subsequently providing different advantages and disadvantages which could later be balanced against each other. Once evaluated based on which layout provided the finest distribution of its processes, it led to the development of an ultimate layout that provided the case company with maximized space utilization, improved flow of material, safer work environments, as well as opportunities for increased productivity. This was later presented to the case company.