India Auto Components: Facility Location Dilemma
Prerequisite Conceptual Understanding
Jay Heizer, et al., “Chapter 7: Location Strategies”, Operations Management, 9th Edition, Pearson Education, 2008
This caselet enables an understanding of the methods of location decision and also the application of Porter’s Diamond Model. T N Shetty (Shetty) started ‘India Auto Components Private Limited’ (IAC) in 2000, in South India. Shetty a technical person, with adequate experience in the manufacturing sector, had decided to set up an auto component manufacturing unit. After zeroing in on four cities to set up a plant, Shetty was in a dilemma to select the most favorable location. Based on his proficiency in the field, he estimated the critical factors and rated the four chosen options. He estimated the number of trailer loads from six different suppliers and tabulated the longitude and latitude coordinates from the map. Can the application of these methods help in to zero in an apt location for his facility?
Expected Learning Outcomes
- • Methods of location decision – Factor Rating Method, Simple Median Model, Centre of Gravity Technique and Load distance Method
- • How to select a place/location with the help of ‘Factor Ratings’ method
- • How to identify the coordinates of a new facility location
- • Analyzing competitive advantage of a location using Porter’s Diamond Model
- I. Evaluate the factors (that affect location of a plant) considered by Shetty to identify the plant location for IAC.
- II. Suggest a location for manufacturing plant for IAC using Factor Ratings method.
- III. .........................
The Teaching Note follows the specific Teaching Plan [Annexure (TN)-I]...............