Mid-Atlantic Bus Lines CASE 7.3 Mid-Atlantic Bus Lines was founded by a group of manag- was collected over several weeks and represents a typical day's ers from Trailways when that company was acquired by operation. Greyhound. They launched a first-class, express bus service operating between the major coastal cities from Philadelphia, Pennsylvania, to Jacksonville, Florida. By hiring laid-off Trailways drivers and leasing buses, they established franchises in each city with local entrepreneurs, who were given the right to operate a Mid-Atlantic bus terminal. A percentage of the 1. Use DEA to identify efficient and inefficient terminal opera- tions. Formulate the problem as a linear programming model, and solve using computer software such as Excel Solver that permits input file editing between runs. reference set of efficient terminals, sales and freight sales would be kept by the 2. Using the appropriate make recommendations for changes in resource inputs for each inefficient terminal. terminal operator to cover his or her costs and profit. After several months of operation, some franchisees com- plained about inadequate profits and threatened to close 3. What recommendations would you have for the one seri- their terminals. Because other franchisees were pleased with ously inefficient terminal in regard to increasing its outputs? their experiences, however, a study of all terminal operations 4 Discuss any shortcomings in the application of DEA to Mid- in the system was undertaken. The information in Table 7.10 Atlantic Bus Lines. TABLE 7.10 Outputs and Inputs for Mid-Atlantic Bus Lines Ticket Sales Freight Sales Labor-Hours Facility Dollars City Served Philadelphia, Pa. Baltimore, Md. Washington, D.C. Richmond, Va. Raleigh, N.C. Charleston, S.C. Savannah, Ga. Jacksonville, Fla. Bus Depot 700 300 200 400 500 500 800 300 300 600 700 600 400 500 500 200 40 50 50 50 40 50 40 30 500 500 400 500 400 500 600 400 2 4 7 8 Mid-Atlantic Bus Lines CASE 7.3 Mid-Atlantic Bus Lines was founded by a group of manag- was collected over several weeks and represents a typical day's ers from Trailways when that company was acquired by operation. Greyhound. They launched a first-class, express bus service operating between the major coastal cities from Philadelphia, Pennsylvania, to Jacksonville, Florida. By hiring laid-off Trailways drivers and leasing buses, they established franchises in each city with local entrepreneurs, who were given the right to operate a Mid-Atlantic bus terminal. A percentage of the 1. Use DEA to identify efficient and inefficient terminal opera- tions. Formulate the problem as a linear programming model, and solve using computer software such as Excel Solver that permits input file editing between runs. reference set of efficient terminals, sales and freight sales would be kept by the 2. Using the appropriate make recommendations for changes in resource inputs for each inefficient terminal. terminal operator to cover his or her costs and profit. After several months of operation, some franchisees com- plained about inadequate profits and threatened to close 3. What recommendations would you have for the one seri- their terminals. Because other franchisees were pleased with ously inefficient terminal in regard to increasing its outputs? their experiences, however, a study of all terminal operations 4 Discuss any shortcomings in the application of DEA to Mid- in the system was undertaken. The information in Table 7.10 Atlantic Bus Lines. TABLE 7.10 Outputs and Inputs for Mid-Atlantic Bus Lines Ticket Sales Freight Sales Labor-Hours Facility Dollars City Served Philadelphia, Pa. Baltimore, Md. Washington, D.C. Richmond, Va. Raleigh, N.C. Charleston, S.C. Savannah, Ga. Jacksonville, Fla. Bus Depot 700 300 200 400 500 500 800 300 300 600 700 600 400 500 500 200 40 50 50 50 40 50 40 30 500 500 400 500 400 500 600 400 2 4 7 8