12 Differences between Product Layout and Process Layout

Distinction between Product and Process Layout

The differences between a product layout and process layout can be studied as follows.

Product Layout vs Process Layout
Product Layout vs Process Layout

1. Nature of Product

Process or functional layout is more suitable for non-standardized products. But product or line layout is suitable for standardized product.

2. Preliminary Investment

Higher initial amount for investment in machines and equipment is required in product or line type of layout whereas in process layout, comparatively, lower initial investment is sufficient.

3. Volume of Production

Process layout is used for a large number of products where similar machines and equipment are used for the manufacture of each product, so the volume per product is low. But product or line layout is preferred where production of each product is done on a large scale basis.

4. Flexibility

Process layout is flexible because necessary alteration or change in sequence of operations can easily be made as and when required without upsetting the existing layout plan. Whereas such changes in product design are quite impossible in machines and operations. Under product layout, if product design is changed, the layout becomes quite obsolete.

5. Effect of Breakdown

In product layout, in the event of any breakdown, the whole production plan is disturbed, whereas in process layout, a breakdown in machines will affect only the operations of that particular department. Other departments will remain unaffected in the short run.

6. Floor Space

Product layout requires less space for the arrangement of machines and equipment. But process layout requires comparatively more space for carrying out the production.

7. Manufacturing Time

Manufacturing time is less in product layout because the raw materials are fed into the machines at one end, the finished product comes out at another end. On the other hand, process layout takes comparatively more time because materials are moved from one machine or department to another by hand.

8. Material Handling Equipment and Costs

Since machines and equipment are arranged in sequence of operations under product layout, mechanical handling equipment like conveyor belts, etc., can be easily adopted. Mechanical handling equipment cannot be used under process layout because of frequent backward and upward movement of materials. So, handling costs
in these two layouts vary considerably.

9. Utilization of Equipment and workers

Under process layout, the equipment is in flexible condition and can be used on various parts or products. Thus, utilization of equipment and machines is fully effective. But under product layout, the equipment and workers cannot be utilized in their full capacity because machines and workers are specialized for specific parts.

10. Supervision

The supervision is easy in product layout but as it requires specific type of supervision, the cost of supervision increases. In contrast, process layout needs frequent and continuous supervision, but due to functional specialization, the cost of supervision is less.

11. Control and Coordination

Production control is very simple in product layout so it necessitates less efforts for coordination. Under process or functional layout, production control is rather difficult because a part has to be routed through a number of departments located at different places. Therefore, much effort is needed to coordinate the functions of various departments.

12. Demand and Supply Layout

Under product layout, proper coordination between demand and supply is easy as they are made to stock. On the other hand, in process layout coordinating demand and supply is slightly difficult as these are made to order.

It is now quite clear from the above discussion that both the systems have their own merits and demerits. Advantages of one type of layout are the disadvantages of other type. Thus, with a view to securing the advantage of both the systems a combined layout may be designed.