14 Questions
What is one of the reasons why location decision is important?
It has a significant impact on fixed and variable costs
How has globalization influenced manufacturing and service operations?
It has led to increasing dispersion of operations around the world and outsourcing to other foreign locations
What has changed in companies' approach to operations due to globalization?
They are finding strategic and tactical reasons to globalize their operations
How are some companies responding to globalization?
Some companies are profiting from their efforts, while others are finding the going tough
What is the objective of the Load-Distance Technique in facility location evaluation?
To minimize the total weighted loads moving into and out of the facility
What is the load in the context of the Load-Distance Technique?
Shipment weight from suppliers to the facility
How is the distance between two points expressed in the Load-Distance Technique?
By assigning the points to grid coordinates on a map
What is used to calculate the load–distance (ld) score for any potential location in the Load-Distance Technique?
Actual travel distances between points using a GIS system
What is the main factor that the Load-Distance Technique seeks to minimize?
The load–distance (ld) score for any potential location
In the Load-Distance Technique, what is the primary purpose of evaluating various locations using a load-distance value?
To calculate the total weighted loads moving into and out of the facility
What is the main difference between the load-distance method and the center-of-gravity method for determining facility location coordinates?
The load-distance method considers multiple locations, while the center-of-gravity method considers only one
What is the key factor that the Load-Distance Technique seeks to minimize when evaluating potential locations for facilities?
The total weighted loads moving into and out of the facility
What factor is used to express the distance between two points in the Load-Distance Technique?
Actual distance traveled using a GIS system
In the context of the Load-Distance Technique, what type of loads are considered when calculating the load–distance (ld) score for potential locations?
All shipments and travels related to the facility
Study Notes
Importance of Location Decision
- One of the reasons why location decision is important is because of its impact on manufacturing and service operations, which has been influenced by globalization.
Impact of Globalization on Operations
- Globalization has changed companies' approach to operations, making them more responsive to global market demands.
- Companies are now more focused on optimizing their operations to meet global customer needs.
Response to Globalization
- Some companies are responding to globalization by adapting their operations to become more agile and responsive to changing market conditions.
Load-Distance Technique
- The objective of the Load-Distance Technique is to evaluate potential facility locations based on the load and distance from suppliers, customers, or distribution centers.
- The load in the context of the Load-Distance Technique refers to the volume of goods or services to be transported between two points.
- The distance between two points is expressed in terms of Euclidean distance (straight-line distance) or rectilinear distance (Manhattan distance).
- The load-distance (ld) score is calculated for any potential location using the formula: ld = ∑ (load × distance) for all points.
- The main factor that the Load-Distance Technique seeks to minimize is the total load-distance score, which represents the total transportation cost or effort.
- The primary purpose of evaluating various locations using a load-distance value is to identify the most cost-effective or efficient location for a facility.
- The Load-Distance Technique is different from the center-of-gravity method, as it takes into account the volume of goods or services being transported, not just the geographic location.
- The key factor that the Load-Distance Technique seeks to minimize is the total transportation cost or effort, which is influenced by the volume of goods or services being transported.
- The Euclidean distance or rectilinear distance is used to express the distance between two points in the Load-Distance Technique.
- The type of loads considered when calculating the load-distance score includes the volume of goods or services to be transported between two points.
Learn about the significance of location decision in production and operations management, and its impact on fixed and variable costs. Explore the steps involved in making location decisions, including identifying countries, regions, and community alternatives.
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