Facilities Design for world class

Competition

William Wrennall

President the Leadwood Group, Ltd.

Leawood, Kansas

The importance of Facilities

Facilities provide the capacity for operaions. They are an important Strategic element for most businesses. They are among the most cost ly investments and compete with marketing, product development and other business activities for scarce resources.

Facilities often require long lead times for construction. In a competitive environment, where new products and customers constantly emerge, timing becomes critical. A facility that is built too soon can drain a company’s financial resources; a facility built too late can lose sales and market share and may relegate an otherwise fine product To the permanent second place.

Facilities last for many years , usually much longer than either products or processes, yet their fundamentl configuration is often permanent. A purpose built facility designed around a specific process technology may become a white elephant when the technology changes. On the other hand, a plant designed for flexibility in purpose built facilities.

The American steel industry, for example, had the world’s largest capacity in open hearth furnaces at the end of World War II. But the introduction overseas of basic oxygen furnaces rendered much of this capacity obsolete. In response, united Statyes Steel built a huge integrated mill in Burns Harbor, Indiana, in the 1960s, with the entire site being designed around the basic oxygen process. Shortly there after, integrated steelmaking with basic oxygen was rendered obsolete by specialized minimills using electric are technologies. This illustrates the hazards of making facilities decisions without considering marketing, changes in technology, and the larger environment.

The best facilities are an integral part of their company’s financial, marketing, and product strategies. When properly designed within the strategic framework, they can support and enhance the firm’s competitiveness. When designed around purely technical considerations, they con drain a firm’s financial and managerial strength and erode the competitive position.

The historical Development of industrial

Facilities

Industrial facilities are the product of the industrial Revolution. The industrial Revolution gained momentum during the middle years of the eighteenth century and dominated the nineteenth century. It was a unique phenomenon in the history of himanking, and its repercussions have spread throughout the world.