Physical deployment

There are three criteria involved when choosing real estate – location, location, location. Anonymous

Many organizations start with one office, shop, factory or lecture block. In time, perhaps others are added in different cities or countries. The physical deployment could range from a room in an individual’s home, to an industrial site of many buildings, a university campus, or a retail chain with thousands of stores worldwide.  

Location may be everything: For some organizations the physical location must be close to customers, but for a mail order company or Internet trader, this is not important and it could depend instead on where suitable staff can be found). The strategy adopted will differ, even inside a sector - some supermarkets favour out-of-town sites while others like Waitrose, are to be found in town centres. Moving the physical location by a few streets can make all the difference. A local charity relocated its shop a short distance to one that was convenient for parking and found that its donations of bulky items immediately increased.

Dispersal: The development of high speed communications facilities means that separation of sites or distance is not such a drawback as in the past. However, these same facilities also mean that geographically dispersed sites can be closed down altogether. For example the Automobile Association closed down over a hundred city centre shops in the UK because the bulk of their business transferred to the telephone and the Internet. BMW’s policy is to operate a decentralized or what it calls a 'dispersal', company. This means being physically present in an export market and developing, purchasing and producing in the market rather than just exporting into it. This may also mean dispersing different functions by having research, design and production in different countries. Good electronic and physical communication systems need to be in place and any cultural differences due to sites being located in different parts of the country or different countries should be part of the equation.

Effect of the Internet: Organizations trading in information or intellectual property and using the Internet can be located anywhere in the world; less costly staff and a favourable tax regime often being the deciding factors. A study into home working predicts that by the year 2020, ten per cent of the top 100 UK companies will have no physical headquarters. >>>