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Case Study Facility Location Planning Analyst


 Ashish Soni EMBA1



A Case Study on the Facility Location Problem for a Large-ScaleCosmetics Product Company


Facility location models have been extensively studied and their practical use reported in supply chain related literature.However, few studies exist that relate these models to Disaster Operations Management, where abundant application may befound, for example the possibility of a large scale production that demands immediate action and requires service to a densely populated area. This work takes a facility location model proposed in literature and presents a case study for its application toDuPage County in Illinois. Prospective medical facilities are selected to service the needs of the various communities.Meaningful results are obtained and discussion of future research possibilities.

1. Introduction

Large scale emergencies are an issue that all levels of the government are gravely concerned about. Since the 2001 terror attacks in New York City, it has become imperative to pursue research into Disaster Operations Management where facilitylocation planning is crucial for the event of a large scale production. Large scale emergencies come in many forms such asman-made disasters, acts of nature, or even during times of combat. Models that suggest facility location plans in the event of emergencies must consider the facility location objective, facility quantity, and service quality. Facility location models have been largely studied and their practical use reported in supply chain related literature [3] [4] [12]. However, very few articles[11] are found reporting the application of these models to situations where medical services are required for emergencies thataffect most of the population. Specifically, in this article a case study is presented where it is assumed a terrorist attack occursover DuPage County in the State of Illinois. The P-center model is applied to determine how to allocate a given number of emergency facilities to satisfactorily meet the population demands. In this work, the distance from major population centersfrom various communities throughout DuPage County and the prospective production facility locations is calculated. Muchof this information is obtained from city officials and using commercially available mapping software. The informationcollected is put into the facility location model and we then run our model using Lingo.

2. Large Scale Production Services

Facility location problems that deal with large scale production services are a special case since they involve low frequencyof attacks and substantial impact on the local communities. An appropriate model should be able to assign a limited number of facilities to service all required demand points. Moreover, the distance between the demand point and the prospectivemedical facility site should be kept to a minimum to ensure that the service is able to manage a large area. However, thechoice of model and the location assignments will remain ambiguous since a large-scale attack is bound to affect thelivelihood of thousands regardless of medical facilities available. Therefore, it is plausible to state that resources should be pooled and distributed to address the needs of many in a large area. Some of the techniques used in LEMS stems fromDisaster Operations Management (DOM) and includes research on mathematical programming [1-2] [9] [13] [15] [17], probability theory and statistics [6], simulation [5] [10] [14] [16], decision theory and multi-attribute utility theory [7-8].

2.1 Terrorist Attack 


case study on facility location planningwe will take an example of paradise recycling company operating in north indiaparadise Recycling Services Inc. has expanded its collection services into a newarea which is himachal pradesh.The business wants to set up a series of collection facilities for recyclable products, such as cans, newspapers, and cardboard boxes in selected districts of h. p. It wants to locate its facilities so they are convenient, but at the same time it doesn't want to put a depot in every city in the area. Location analysisis an ideal means of helping Paradise serve its clients well at as low a cost aspossible.it uses location analysis to show what its options are.the selection of appropriate location depending on the size of the industry can be done in two stagees1- evaluaton of various geographic areas and the selection of an optimum area2- with in each area there is a choice of proper site which can be urban ,sub urban ,or rural are gererally know as ind. zonesThus in the process of loc ana. 1stly sum appropriate geo. areas is selected n frm dat area a proper site is sel. 4 d establishment of d plant . d analysis 4 dchoice opf appropriate area n coresponding site is based on a no. of measures discribed belowMEASURES 4 D SEL. OF LOCATION:the fundamental objective of facility location analysis is to max. d profit by min the total cost of production process n marketing cost of finished productTOTAL COSTS= FIXED COST+OPERATIONAL COSTSfixed costs include expenditure on land building machines and other equipments etc. operational costs are d expendituresincurred on inputs, transformation process n d distribution of output.d contribution of d various factors to d total cost will vary from place to place eg. a possible advantage of cheap labour at someplace may be offset by more expenditure on fuel, power, taxes etc. similarly dcontri of various fartors also depend on d nature of product eg. in oil n chemical product d labour cost represent only a small proportion of total costs whereas it is quite high in garment n texitle industryThus the selection of an area n finally a site for a plant needs a careful studyif a good job is to be donethe ana lysis canbe didived into 2 catagerios1- involving quantitative factors2- comparison of qualitative factors1- analysis based on quantitative factorsunder ths d various methods used areA- comparetive cost chart - this is based on location cost summary chart a comparitive chart of total cost involved in setting up a plant is preparedthe comapany strategically evaluated varios 10 locationLOCATION ANALYSISA location profile of the area helps the business understand the trade-off between population coverage and number of recycling depots. With fewer depots, a smaller number of people is within a given coverage radius, but costs are lower. Atthe same time, locating more facilities (in the most strategic manner possible)helps to bring the recycling service close to more people, but at higher cost. The graph below shows the balance between percent of population within range of adepot, and number of depots. For example, the graph shows that four depots located strategically would be within 4 district which covers of 70% of the area's p

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