Layout is essentially a task of orderly arrangement of the plant and equipment for the purpose of securing continuous flow of the required quantity and quality of the given product. There are mainly three types of layout: 1. Product or Line Layout 2. Process Layout 3. Combination of Product and Line Layouts.

Type # 1. Product or Line Layout:

Product or straight line layout means the arrangement of production equipment in the order of manufacturing operations. “Line layout is intended to effect an orderly and logical arrangement of productive facilities that will be consistent with large production volume.”

The equipment is placed in the same order of physical arrangement that is indicated by the manufacturing plan and processes. In other words, all the machines needed to produce a part or whole of the product are arranged sequentially in continuous line.

The series of machines would be arranged in line to perform a definite composite activities involved in manufacturing a given product. The job moves successfully from machine to machine moving a short distance at a time until all the required operations are completed. “This arrangement results in processing of the product in a forward flow from the receipt of the raw materials to shipment of the finished product.”


The manufacturing unit is built up as the result of minute division of labour implying breakdown of operations into different elements. Each element or group of elements would be handled through a specially designed equipment manned by operators in repetitive routine sequence.

The material flows through the pre determined channels of operations from the receipt of the raw materials to the fabrication of the component part to the final assembly or finishing stage and then to the dispatching or shipping devices.

Pattern or Line Layout:

Line layout is used in a number of continuous type of industries like cement, flour mills, sugar, paper factory, rolling mills etc. It is also being tried in repetitive process industries like the automobile, ratio-sets etc.


Conditions which favour the adoption of this type of layout are:

a. Large-scale production of standardised articles.

b. Existence of versatile machine or equipment of equal capacity to secure balancing of operations in pre-determined sequence.

c. Continuous employment of workers operating the serialised machine and equipment.


d. Each operation should have an output potential at par with that of the succeeding operation.

e. Establishment of perfect lines between operations or machines through quick, economical and accurate material handling devices.

Advantages of Product or Line Layout:

(1) Since production is planned according to an orderly sequence, manufacturing time from the initial operation to the finished product is economically and effectively regulated.


(2) This layout facilitates adoption of automatic material handling devices. The channelisation of work-flow through direct lines and short distances of travel in product layout makes it possible to install labour-saving and low-cost mechanically movement devices (materials handling from operation to operation) like roller conveyors, monorails, chutes, etc. This reduces the cost of materials handling in relation to the aggregate manufacturing cost and brings about quicker and smoother movement of the job on the line.

(3) The well-balanced and adjusted plant-line will eliminate almost all the possible bottlenecks in the production process. Backtracking, interruption in flow of product and other obstructions are sought to be avoided by the balancing of equipment, operations, handling and workers’ assignment.

(4) Since intermediate activities between operations are minimum due to absence of dilatory internal transportation of materials, production is completed promptly through the shortened built in sequence of the plant complex.

The turnout of output is quicker and the lock-up of working capital in the form of stocks of raw materials and finished goods is reduced thereby


(5) Since producing is carried on in a pre-arranged continuous sequence, the stock of work-in-process or materials in transitory process is reduced to the minimum.

(6) Production control is comparatively easy, simple and inexpensive. Once the production process starts as per plants, it is difficult to side track it or deviate it from the scheduled path and timings.

Engineering drawings, lists of parts, materials, routine procedures, production schedules one finalised at the time of commencement of the operation will help in controlling the successive operations on the job line till completion. There would be lesser need for further clerical and administrative work in the regulation of production.

(7) Lesser need for inspection or supervision is another merit of this type of layout. Since each complete product is made on one line, a limited amount of inspection at some critical points is sufficient.


(8) There is a greater productive utilisation of the floor area under this type of layout. Due to lesser need for temporary storage of materials and due to automatic material handling arrangement, the vast floor area is not jam-packed with tools, materials, work-in process etc. The aisles or passage space is kept to the minimum.

The concentration of manufacturing activities and facilities at one place in continuous sequence and the higher output planned under the layout result in a smaller floor area per unit of product, thus making the total floor area more productive.

Disadvantages of Product or Line Layout:

1. This layout requires heavy capital investment in machines and equipment and for providing specialised facilities to support the sequentially arranged operations.


Even at the initial level sufficient capital has to be raised to launch a new plant. Some kinds of machines, tools etc. are found at different centres and in different stages of the manufacturing line. Thus the whole enterprise becomes a highly capital-intensive venture. Such heavy capital investment implies risks of uncertain return.

2. Due to heavy investment, the overhead fixed charges also tend to be high. A decline in demand for the product renders the equipment over capitalised with unused capacity adding to the higher overhead costs.

“Unless the demand can be accurately forecast well into the future and production capacity created only sufficient to satisfy this demand, firms under product layout frequently find themselves burdened with high fixed charges incident to large unused capacity.”

3. The production line is vulnerable to interruption and shutdowns. Break down of machine renders the entire line ineffective. The subsequent machines and smen will have to remain idle till the preceding machine is set right.

4. Inflexibility is a drawback of this type of layout. The equipment laid out is designed to perform specific operations. No machine unit in the line is perfectly interchangeable in capacity or kind or work with any other machine.

Any change over, machine replacement required by design-improvements or revisions would lead to costly interruptions in production. Because the production facilities created for a defined line are inflexible or unsuitable for revised line or product, technological inventions render the previous line equipment obsolete.


5. Expansion of output on substantial scale is impossible on product lines laid out to specific capacity. Catering to the rise in demand by expanding the output beyond the pre-ordained machine capacities in the line is not possible under this type of layout.

6. There is greater difficulty in securing specialised supervision, because line layout consists of several machines requiring a wide range of knowledge on the part of the supervisor to watch the fulfilment of the set-goals of production.

The foreman in each department is held accountable for all the activities of his department-loading, scheduling, maintaining discipline, controlling the production, inspecting the quality etc. “Such a diverse supervisory assignment may not readily lend itself to specialisation and mastery by average foreman.”

Type # 2. Process or Functional Layout:

Process Layout is marked by arrangement of similar operations in one place. In other words, under the process layout similar processes or equipment are grouped together. These groupings are generally known as departments or shops-each constituting a distinct unit. It involves “the partition of the plants into several work areas each of which is occupied by a particular type of machine or operation.”

This plan of organising the physical facilities results in functional arrangement of the layout. For example, milling department, drilling department, welding department, casting department, painting department, assembling or finishing department are organised with the respective equipment, tools and machines.

Many operations are common and they can be performed by common machines. Hence a given job is taken to the concerned department for processing and finally, if necessary, the parts may be brought to the central assembling department.


Unlike under line layout job is not completed in sequential order through serialized machines. But each process involved in the manufacturing of a product is performed in separate work areas or departments equipped with the requisite machinery and other allied physical facilities.

Process layout is suitable to non-repetitive or intermittent types of production where special order, each distinct from the other, are handled. It is particularly designed for plants manufacturing articles like machine tools, locomotives, made to order furniture, etc. Thus plant in which “variety of products can be produced on the same facilities” are laid out on functional basis.

Non-standardised products and products which are required in smaller quantities at sporadic intervals are set under process layout.

The arrangement of operations is not necessarily in line sequence, although different process departments may be located in sequential contiguity. Since sequential arrangement is not a basic feature of this layout, attention has to be given to the efficient system of materials handling, in intermittent industries.

In assembling industries machines are so arranged department-wise that the finished product of one department is passed on to the next department for subsequent processing with minimum of handling.

Advantages of Process Layout:


1. Lower Capital Investment:

Less capital is needed for this type of layout because production apparatus is applied to maximum capacity with minimum duplication. The designed volume of production can be turned out without the need for duplication of machines.

Since the equipment is not passed on to any set sequence of operations, variety of products in required quantities can be produced with the same general machines and tools arranged department wise. With comparatively lesser investment more output can be turned out.

2. Greater Flexibility:

Each machine can perform a wide range of similar kinds of operations. The same layout can be adapted for enlarged or revised operations without disturbing the departmental set-up. There is flexibility in planning production and job scheduling for each department. Furthermore, it is possible to operate on short notice without undue dislocation of normal schedule and routine.

3. Specialisation:


Since the principle of specialisation is followed in departmental allocation of work, there is fuller utilisation of the skill of the employees.

4. Effective Supervision:

More effective use of specialised abilities of supervisors is one of the main merits of this type of layout. Each foreman supervises only a limited range of machine operations in the respective department (foreman welding department, foreman machine department, etc.).

Obviously his supervisory efforts tend to be more intensive. He becomes “highly proficient in time and with practice” in planning, direction, control, maintenance of the operations assigned to his department.

5. No disruption in Work-Schedules:

Since each department had bank of machines and tools, breakdown of one machine does not necessarily upset the production schedule, It can be transferred to another machine in the department.


6. Lower Overhead Costs:

Since the initial capital investment is relatively low, risks of investment are reduced. Production equipment is more flexible and hence less subject to obsolescence and losses resulting from shifts in market demand. Hence overhead costs per unit tend to be lower.

Disadvantages of Process Layout:

1. Complexity of Production Planning and Control:

The absence of sequential mechanised channels for production makes routing and scheduling more difficult and time consuming. The responsibility for production is divided among many department foremen and hence it is difficult to pin-point the accounting for the overall performance.

Since the process are non-repetitive separate controlling devices are to be devised and enforced for each process. Separate work orders, material requisition, time cards, etc. have to be maintained for each process affiliated to each department.

2. Frequency of Inspection:

Under this layout each department is accountable for a specialised operation. Inspection is frequently essential before the work is passed on to the successive operation in another department. Inspection becomes inevitable at every stage because the next department should not reject the material processed by the preceding departments.

3. Difficulty of Materials Handling:

Under the process layout there would be higher costs of materials handling because of the routine of work to various departments and the greater distances over which jobs have to move. Moreover materials handling cannot be easily mechanised under this layout because of definite channels in the flow of materials in serial order.

4. More Floor Area:

This type of layout involves more floor space for locating different departments, setting up temporary storage, leaving aisles and passages, inspection cribs, service facilities, etc. Machine production centres handling diverse operations of varied sizes require larger floor area than under the product layout wherein operations are balanced in a sequence.

5. Wasteful Back-Tracking:

Due to distribution of production operations among diverse departments, backward and forward tracking of work becomes in evitable. Frequency of such internal haulage proves to be wasteful and adds to the burden of overhead costs.

6. Longer Processing Time:

Production process will take a long time for completion because the job has to be moved from department to department. Greater time is spent on loading the machines after collecting the work from preceding department. At each stage loading, inspection, conveying to other department hold up the flow and lengthen the processing time.

7. Larger Stock of Materials in Process:

Since larger stock of materials is held up in the process due to frequent back-tracking and difficulty of materials handling, the working capital is locked up with slow turnover and low rate of return on investment.

Type # 3. Combined Layout:

It is very rare that plants are laid out either in absolute line form or process form. Depending on the scale of operations, volume of output, variety of products, product and process layout patterns are often combined to have best of both the systems. “Many business firms find it to their economic advantage to apply both the approaches as a solution to their production problems.”

Line layout is the primary approach when volume of production is the main criterion while process layout is the key to the layout when the variety of products is the underlying policy.

A firm engaged in ‘repetitive manufacture of standard products’ may ‘group expensive machines for intensive use. These machine groupings may be built into the straight line arrangement in the production centres. Services facilities, fabrication processes like cranes, grinders, welding machines, etc. may be segregated and arranged as a process layout to be useful for working on various parts of standardised product.

Whenever products are of limited variety but are having large and stable sales prospects, line layout is adopted. For the firms producing various types of products on limited scale as per orders on hand, process layout is advisable.

Both the types may be adopted in suitable pattern by firms producing single or a few line of products on large scale and many other articles or varieties thereof on specific orders on relatively smaller scale.