Professional Documents
Culture Documents
Service Management (5e) Operations, Strategy, Information Technology by Fitzsimmons and Fitzsimmons
Service Management (5e) Operations, Strategy, Information Technology by Fitzsimmons and Fitzsimmons
Service Management (5e) Operations, Strategy, Information Technology by Fitzsimmons and Fitzsimmons
Chapter 9
Service Facility Location
9-2
Learning Objectives
Discuss
Locate
Discuss
9-3
9-4
Geographic Representation
Location
Plane
d ij ( xi x j ) ( yi y j )
2
2 1/ 2
Metropolitan
dij xi x j yi y j
9-5
Geographic Representation
Location on a Plane
Y
Destination j
Yj
Euclidean
d ij
( x x )
i
( yi y j )
Origin i
Yi
Metropolitan
dij xi x j yi y j
0
Xi
Xj
2 1/ 2
9-6
Location on a network
It
Example,
The
Networks
Unfortunately,
9-7
Multisite location
Location
However,
9-8
Optimization Criteria
Criteria
Private
sector
9-9
Public
sector criteria
9-10
utilization
Maximize
Minimize
Minimize
9-11
10
15
-10
-5
10
15
1. Maximize Utilization
-10
City B
20
25
-5
-15
City C
9-12
Unit must be large enough to contain a sample size required for estimating
demand
We should not have so many geographic units, that we cannot do calculations
using our computing power.
Regression analysis
9-13
facility on a line
Suppose
i 0
is
Z wi ( s xi ) wi ( xi s )
S = site of the beach mat concession
i location of the i-th demand point on the beach in feet from the
origin, in this case taken to be west end of the beach
wrelative weight of demand attached to the i-th location on beach
9-14
9-15
However,
9-16
9-17
When firms in the same business locate close to each other so that
customers can compare more easily, ex., car dealership, motels
Saturation
Clustering
Marketing
When a company locates its units close to each other to squeeze out
the competition, reduce advertising needs, increase customer
awareness, better inventory management.; example Au Bon Pain,
Risk of cannibalizing your sales
Marketing
Intermediaries
9-18
Continued.
Substitute
Impact
9-19
External
Customer
Is service performed on
person or property?
Is co-location necessary?
Internal
Customer
(employee)
Back Office
How is communication
accomplished?
9-20
How
Why
What