9

2 40
7
30 35
1 8

3
4 6

5
Maximal service distance of 30 kms
 CHC Community served
location
1 (1, 2, 3, 4)
2 (1, 2, 3)
3 (1, 2, 3, 4, 5)
4 (1, 3, 4, 5, 6, 7)
5 (3, 4, 5, 6)
6 (4, 5, 6, 7, 8)
7 (4, 6, 7, 8)
8 (6, 7, 8, 9)
9 (8, 9)
When you need to decide about the CHC location
pertaining to n different villages??

Objective Minimum number of CHC

Constraint Each village must be covered

by atleast one CHC
Strategies in facility location decisions

Services to be offered at a new location

✓Increasing affluence of populace

✓Metros city first
✓Other tier 1/tier 2 cities later on
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Strategies in facility location decisions

To cater to the increased demand expanding the service

facility (including addition of new service package)

✓Airports in many of the metro cities in India has

seen the expansion off late
✓Inclusion of facilities to include recreational actives
such as spa, gymnasium etc.

https://www.youtube.com/watch?v=k4JH30Xhjtw
✓Benefits for not just for concerned service provider
and passengers but a broader stakeholder

Stakeholders Key benefits

Citizens Affordability

Central government Connectivity

State government Local Development

Airlines Business growth

 Facility location decisions for competitive advantage
1) Create entry barriers
✓Locate service facilities in prime markets where
competitors can not enter.
✓Locating Hotel in the heart of the city or near airport.
# Hilton vs. VW canyon.

2) Generate and manage demand

✓Locate the facility near the diverse set of market
generators.
✓Hotels – fixed capacity / Efficient utilization
# Oyo room nears railways stations.
3) Create service location flexibility
✓Facility location decision being a capital-intensive decision
can not been changed frequently.
✓Facilities need to be expected to responsive to future
economic, demographic, and social change over a period
of time.
# Locating service facility at multiple sites/ Big Bazaar at Naya
Raipur.
4) Competitive positioning
✓Locate the facilities at strategically important site.

# Locate hotel near beaches.

Key attributes in facility location decision

Convenience & proximity to customers

(Grocery shops)
(Customer based)

Lesser operating costs (Wholesale

(Cost based) markets)

Locate near competition cluster Automobile

(Competitive clustering based) dealers

Availability of support systems

(24 x 7 call center)
(Support System based)
Depending upon nature of services

Quasi-
Demand Delivered
manufacturing
sensitive services services
service
• Attract • Covering a • Minimizing the
customer geographic area logistical cost of
through effectively multiple
locational location
advantage network

(Retail store) (Fire stations) (Warehouses)

Apporva: A facility location dilemma
Service Facility
Serviceascape

Ambient conditions

Servicescape Space/functions

Sign, symbols, &

artifacts

Servicescape describes the physical surroundings of the service

system. As soon as the customer enters the service system, he/she
perceives the physical surroundings that lead to cognitive,
emotional, and physiological responses in them thus affecting
customer’s behavior.
Ambient conditions – Quality of air

Separate smoking zones

at airports

Separate smoking areas

in some restaurants

Bouts of humid air is

pumped to fly at high
altitude in cabin
Ambient conditions – Sound and Music

Some hospitals play soft and soothing music, and

spiritual chants to foster calmness and wellness of
patients

Jazz music is played in five-star restaurants for

add to the service experience of fine dining
Ambient conditions – Smell and fragrance

✓ At Oberoi hotel in Mumbai, diffusers at

placed in common area to set-off a specific
Madurai jasmine.

✓ Sense of luxury
Ambient conditions – Color

Compared to other White color is usually Playschools are made

colors, yellow catches associated with purity, colorful and attractive to
the attention the most calmness, and cleanliness make ambience more lively
Space/functions – Layout design

Restaurant China gate has a private dining

area for larger families to avoid inconvenience
to other guests

Pharmacies at many hospitals are placed on

ground floor for easier access to patients and
their relatives
Space/functions – Exterior facilities

✓ The Leela Mumbai hotel near international

airport is an island of green.

✓ Exterior of hotels include 11 acres of

gardens and waterfalls
Sign, symbols, & artifacts

Symbols for safety measures such in

airlines

Anti ragging directives on notice on

boards
Different type of services which impact
Servicescape

✓Banks/Hospitals
Interpersonal Service ✓Facilitate interaction
(Customer-Employees) between service
providers and customer
Types of
service ✓ATMs/Vending machine
Self-service
✓Servicescape should be
(only Customer present in
to guide customer
service system) effectively.
Innovations at McDonalds in US

✓Indoor seating – 1950s

✓Drive through window – 1970s

4 out of 5
✓Adding breakfast to the menu – 1980s innovations
pertains to
✓Adding play areas for children – Late 1980s layout

✓Self service kiosk – 2004

Service Facility Layout
Product layout

Chassis Engine Cab ………… ………… Type Vehicle rollout

drop mounting mountin …........ ………… fitment
g
Why product layout ?? Volume and variety
Adopting product layout in service
✓ Standard service to a large number of customers
A Typical Cafeteria’s layout (1 hour time window for lunch)

Serve starters Serve Main

Serve drinks Serve dessert
& soup course
20 30 40 15
seconds seconds seconds seconds

Customer as Input to the system

Is it a efficient service layout?

Can it be improved in any manner from a both service provider’s

perspective and customer’s perspective?
 What should be the ideal layout??

Serve starters Serve Main

Serve drinks Serve dessert
& soup course

26.25 sec 26.25 sec 26.25 sec 26.25 sec

Ideal service process capacity=137.14

Service labor utilization = 100%

Customer served per worker = 34.28

Labor utilization = (Total labor

content) / {Process cycle time) x (No.
of workers) }
 120 customers/hour 240 customers/hour

Serve starters Serve Main

Serve drinks Serve dessert
& soup course
20 30 40 15
seconds seconds seconds seconds

180 customers/hour 90 customers/hour

Service process capacity= 90 customers Bottleneck

elimination/
Service labor utilization = 65.63% Minimization

Customer served per worker = 22.5

Labor utilization = (Total labor
content) / {Process cycle time)
x (No. of workers) }
Bottleneck elimination/ Minimization

Serve starters Serve Main

Serve drinks Serve dessert
& soup course
20 30 20 15
seconds seconds seconds seconds

Service process capacity= 120 customers

Service labor utilization = 70 %

Customer served per worker = 24

Labor utilization = (Total labor

content) / {Process cycle time)
x (No. of workers) }
Process layout in service

Typical layout of a retail shop