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Case studies of successful location strategies and their operational effectiveness

A.D. Smith and S.R. Clinton

International Journal of Management and Enterprise Development, 2009, vol. 6, issue 3, 322-343

Abstract: A major operational decision is location strategy, which is the process of determining where an organisation should put its facility and how the organisation should determine this decision. Such a decision typically has long-term implications and is very difficult to reverse. In general, although there are similarities among the various organisations when choosing a location, each company chose a locale for reasons specific to their industry. Morningstar and Kennametal, Inc. want to make sure that their location is especially close to major highways, railways and rivers. As their customers are global, they want easy access to all of their buyers/customers to ensure satisfaction. These business strategies are also in place at AT&T Wireless, again ensuring that their locations are centrally located in a penetrable market based on specific financial constraints; while BHP Billiton chose their location based on their customer base, where they strategically positioned themselves close to steel industries in order to provide sufficient resources to their clients.

Keywords: business strategy; centre-of-gravity method; competitive advantage; enterprise development; factor-weighted method; location strategy; OBITDA contribution; operations management; operational effectiveness; facilities location; case studies. (search for similar items in EconPapers)
Date: 2009
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Handle: RePEc:ids:ijmede:v:6:y:2009:i:3:p:322-343