Question 6.3: Assign the three departments shown in Table 6.6 to locations......

Ranking departments according to highest work flow and locations according to highest interlocation distances helps in making assignments.

From these listings, you can see that departments 1 and 3 have the highest interdepartmental work flow, and that locations A and B are the closest. Thus, it seems reasonable to consider assigning 1 and 3 to locations A and B, although it is not yet obvious which department should be assigned to which location. Further inspection of the work flow list reveals that 2 and 3 have higher work flow than 1 and 2, so 2 and 3 should probably be located more closely than 1 and 2. Hence, it would seem reasonable to place 3 between 1 and 2, or at least centralize that department with respect to the other two. The resulting assignments might appear as illustrated in Figure 6.11 .

If the cost per meter to move any load is $1, you can compute the total daily transportation cost for this assignment by multiplying each department’s number of loads by the trip distance, and summing those quantities:

At $1 per load meter, the cost for this plan is $7,600 per day. Even though it might appear that this arrangement yields the lowest transportation cost, you cannot be absolutely positive of that without actually computing the total cost for every alternative and comparing it to this one. Instead, rely on the choice of reasonable heuristic rules such as those demonstrated above to arrive at a satisfactory, if not optimal, solution.