ABSTRACT
In our view, a typical manager or engineer’s time is concerned with managing demand, inventory, and transportation in an existing supply chain network. Hence, up to this point in the book, we have discussed the issues of forecasting customer demand, determining production and inventory to meet that demand, and managing the transportation process to fulfill the demand in the supply chain. The problems of managing an existing supply chain network are far more pervasive and frequently encountered in practice compared to designing a new network or re-designing an existing one. One might justifiably ask at this point, “How did the decision makers actually decide the location of the facilities in the network and the assignment of those facilities to the customers they serve?” Therefore, in this Chapter, we focus our attention to “location and distribution” strategies or designing and operating the supply chain network. The key questions to answer in this effort are the following:
• How do we design a good (or perhaps the best) network? • What are the key objectives for the network? • What are the primary decision variables? Are they strategic or
tactical decisions? • What are the key constraints of the network? • What network alternatives should be considered?
