1. Practice Problems Problem 1:
A major drug store chain wishes to build a new warehouse to serve the whole Midwest. At the moment, it is looking at three possible locations. The factors, weights, and ratings being considered are given below:
Ratings
Factor Weights Peoria Des Moines Chicago
Nearness to markets
Labor cost
Taxes
Nearness to suppliers
Which city should they choose?
PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J

2. Practice Problems Problem 1:
A major drug store chain wishes to build a new warehouse to serve the whole Midwest. At the moment, it is looking at three possible locations. The factors, weights, and ratings being considered are given below:
Based upon the weights and rating, Des Moines should be chosen.
Weighted Ratings
Peoria Des Moines Chicago
Total
Ratings
Factor Weights Peoria Des Moines Chicago
Nearness to markets
Labor cost
Taxes
Nearness to suppliers
Which city should they choose?
PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J

3. Practice Problems Problem 2:
Balfour’s is considering building a plant in one of three possible locations. They have estimated the following parameters for each location:
Location Fixed Cost Variable Cost
Waco, Texas $300,000 $5.75
Tijuana, Mexico $800,000 $2.75
Fayetteville, Arkansas $100,000 $8.00
For what unit sales volume should they choose each location?
PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J

4. Practice Problems Problem 2: Transition between Waco and Tijuana
300, x = 800, x
3x = 500,000
x = 166,000
Transition between Waco and Fayetteville
300, x = 100, x
2.25x = 200,000
x = 88,888
Problem 2:
Balfour’s is considering building a plant in one of three possible locations. They have estimated the following parameters for each location:
Location Fixed Cost Variable Cost
Waco, Texas $300,000 $5.75
Tijuana, Mexico $800,000 $2.75
Fayetteville, Arkansas $100,000 $8.00
For what unit sales volume should they choose each location?
PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J

5. Practice Problems Problem 2: Transition between Waco and Tijuana
Locate in Fayetteville
Transition between Waco and Tijuana
300, x = 800, x
3x = 500,000
x = 166,000
Transition between Waco and Fayetteville
300, x = 100, x
2.25x = 200,000
x = 88,888
Problem 2:
Balfour’s is considering building a plant in one of three possible locations. They have estimated the following parameters for each location:
Location Fixed Cost Variable Cost
Waco, Texas $300,000 $5.75
Tijuana, Mexico $800,000 $2.75
Fayetteville, Arkansas $100,000 $8.00
For what unit sales volume should they choose each location?
PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J

6. Practice Problems Problem 3:
Our main distribution center in Phoenix, AZ is due to be replaced with a much larger, more modern facility that can handle the tremendous needs that have developed with the city’s growth. Fresh produce travels to the seven store locations several times a day making site selection critical for efficient distribution. Using the data in the following table, determine the map coordinates for the proposed new distribution center.
PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J

7. Practice Problems Problem 3:
Our main distribution center in Phoenix, AZ is due to be replaced with a much larger, more modern facility that can handle the tremendous needs that have developed with the city’s growth. Fresh produce travels to the seven store locations several times a day making site selection critical for efficient distribution. Using the data in the following table, determine the map coordinates for the proposed new distribution center.
Truck Round Trips
Store Locations Map Coordinates (x, y) per Day
Mesa (10, 5) 3
Glendale (3, 8) 3
Camelback (4, 7) 2
Scottsdale (15, 10) 6
Apache Junction (13, 3) 5
Sun City (1, 12) 3
Pima (5, 5) 10
PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J

8. Practice Problems Problem 3: Cx = = = 7.97 Cy = = = 6.69
(10*3) + (3*3) + (4*2) + (15*6) + (13*5) + (1*3) + (5*10)
255 32
Cy = = = 6.69
(5*3) + (8*3) + (7*2) + (10*6) + (3*5) + (12*3) + (5*10)
214
Practice Problems
Problem 3:
Our main distribution center in Phoenix, AZ is due to be replaced with a much larger, more modern facility that can handle the tremendous needs that have developed with the city’s growth. Fresh produce travels to the seven store locations several times a day making site selection critical for efficient distribution. Using the data in the following table, determine the map coordinates for the proposed new distribution center.
Truck Round Trips
Store Locations Map Coordinates (x, y) per Day
Mesa (10, 5) 3
Glendale (3, 8) 3
Camelback (4, 7) 2
Scottsdale (15, 10) 6
Apache Junction (13, 3) 5
Sun City (1, 12) 3
Pima (5, 5) 10
PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J

9. Practice Problems Problem 3: Cx = = = 7.97 Cy = = = 6.69
(10*3) + (3*3) + (4*2) + (15*6) + (13*5) + (1*3) + (5*10)
255 32
Cy = = = 6.69
(5*3) + (8*3) + (7*2) + (10*6) + (3*5) + (12*3) + (5*10)
214
Practice Problems
Problem 3:
Our main distribution center in Phoenix, AZ is due to be replaced with a much larger, more modern facility that can handle the tremendous needs that have developed with the city’s growth. Fresh produce travels to the seven store locations several times a day making site selection critical for efficient distribution. Using the data in the following table, determine the map coordinates for the proposed new distribution center.
PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J

10. Practice Problems Problem 4:
The following table gives the map coordinates and the shipping loads for a set of cities that we wish to connect though a central “hub.” Near what map coordinates should the hub be located?
City Map Coordinate (x, y) Shipping Load
A (5, 10) 5
B (6, 8) 10
C (4, 9) 15
D (9, 5) 5
E (7, 9) 15
F (3, 2) 10
G (2, 6) 5
PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J

11. Practice Problems Problem 4: Cx = = = 5.15 Cy = = = 7.31
(5*5) + (6*10) + (4*15) + (9*5) + (7*15) + (3*10) + (2*5)
355 65
Cy = = = 7.31
(10*5) + (8*10) + (9*15) + (5*5) + (9*15) + (2*10) + (6*5)
475
Problem 4:
The following table gives the map coordinates and the shipping loads for a set of cities that we wish to connect though a central “hub.” Near what map coordinates should the hub be located?
City Map Coordinate (x, y) Shipping Load
A (5, 10) 5
B (6, 8) 10
C (4, 9) 15
D (9, 5) 5
E (7, 9) 15
F (3, 2) 10
G (2, 6) 5
PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J

12. Practice Problems Problem 4: Cx = = = 5.15 Cy = = = 7.31
(5*5) + (6*10) + (4*15) + (9*5) + (7*15) + (3*10) + (2*5)
355 65
Cy = = = 7.31
(10*5) + (8*10) + (9*15) + (5*5) + (9*15) + (2*10) + (6*5)
475
Problem 4:
The following table gives the map coordinates and the shipping loads for a set of cities that we wish to connect though a central “hub.” Near what map coordinates should the hub be located?
PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J

13. Practice Problems Problem 5:
A company is planning on expanding and building a new plant in one of three countries in Middle or Eastern Europe. The general manager, Patricia Donegal, has decided to base her decision on six critical success factors: technology availability and support, availability and quality of public education, legal and regulatory aspects, social and cultural aspects, economic factors, and political stability.
Using a rating system of 1 (least desirable) to 5 (most desirable) she has arrived at the following ratings (you may, of course, have different opinions). In which country should the plant be built?
PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J

14. Practice Problems Problem 5:
A company is planning on expanding and building a new plant in one of three countries in Middle or Eastern Europe. The general manager, Patricia Donegal, has decided to base her decision on six critical success factors: technology availability and support, availability and quality of public education, legal and regulatory aspects, social and cultural aspects, economic factors, and political stability.
Using a rating system of 1 (least desirable) to 5 (most desirable) she has arrived at the following ratings (you may, of course, have different opinions). In which country should the plant be built?
Critical Success Factors Turkey Serbia Slovakia
Technology availability and support 4 3 4
Availability and quality of public education 4 4 3
Legal and regulatory aspects 2 4 5
Social and cultural aspects 5 3 4
Economic factors 4 3 3
Political stability 4 2 3
PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J

15. Practice Problems Problem 5:
A company is planning on expanding and building a new plant in one of three countries in Middle or Eastern Europe. The general manager, Patricia Donegal, has decided to base her decision on six critical success factors: technology availability and support, availability and quality of public education, legal and regulatory aspects, social and cultural aspects, economic factors, and political stability.
Using a rating system of 1 (least desirable) to 5 (most desirable) she has arrived at the following ratings (you may, of course, have different opinions). In which country should the plant be built?
Critical Success Factors Turkey Serbia Slovakia
Technology availability and support
Availability and quality of public education
Legal and regulatory aspects
Social and cultural aspects
Economic factors
Political stability
 =
Based upon her ratings of the critical success factors, Patricia should choose Turkey.
PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J

16. Practice Problems Problem 6:
Assume that Patricia decides to use the following weights for the critical success factors:
Technology availability and support 0.3
Availability and quality of public education 0.2
Legal and regulatory aspects 0.1
Social and cultural aspects
Economic factors
Political stability
Would this change her decision?
PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J

17. Practice Problems Problem 6:
Assume that Patricia decides to use the following weights for the critical success factors:
Technology availability and support 0.3
Availability and quality of public education 0.2
Legal and regulatory aspects
Social and cultural aspects
Economic factors
Political stability
Would this change her decision?
Critical Success Factors Wgt Turkey Serbia Slovakia
Technology availability and support
Availability and quality of public education
Legal and regulatory aspects
Social and cultural aspects
Economic factors
Political stability
 =
1.2
0.8
0.2
0.5
0.4
3.9
0.9
0.3
3.1
0.6
3.6
In this case, use of the weighting factors does not change the recommendation.
PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J

18. Practice Problems Problem 7:
Patricia’s advisors have suggested that Turkey and Slovakia might be better differentiated by either:
doubling the number of critical success factors, or
breaking down each of the existing critical success factors into smaller, more narrowly defined items, e.g., Availability and quality of public education might be broken into primary, secondary, and post-secondary education.
How would you advise Ms. Donegal?
PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J

19. Practice Problems Problem 7:
Doubling the number of critical success factors. There are two issues here. First, from a practical perspective there are a limited number of truly “critical” success factors – and these should be the ones presently being considered. Any additional factors should be of secondary or tertiary importance. Second, given the subjective nature of the rating process, adding additional factors would also increase the overall margin of error of the final ratings to a degree that may eliminate any gain in differentiation arising from the use of the additional factors. The use of a maximum of seven to nine critical success factors is usually appropriate.
Given that one’s ability to estimate or rate an aggregate is usually better than one’s ability to estimate or rate the individual components of the aggregate, this approach is unlikely to provide much help.
Problem 7:
Patricia’s advisors have suggested that Turkey and Slovakia might be better differentiated by either:
(a) doubling the number of critical success factors, or
(b) breaking down each of the existing critical success factors into smaller, more narrowly defined items, e.g., Availability and quality of public education might be broken into primary, secondary, and post-secondary education.
How would you advise Ms. Donegal?
PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J