Identifying Ideal Hub Locations

The team identified three ideal hub locations – Germany, Australia, and China, which could be supplanted by South Korea. The selection of countries was driven by the results of PESTEL and Data Envelopment Analysis. World Bank and Cancer Atlas databases were used as sources of the necessary input data. PESTEL model analyzes the political, economic, social, technological, environmental, and legal factors of the selected countries. The political factors were reflected in the ease of doing business criterion and intellectual property protection index. The economic side was represented by the enrollment rate of institutions of higher learning, logistics performance index, the volume of air transportation, and import turnaround time. The social factors were reflected in the population of cancer patients and the size of the middle class. The technological side was represented by the percentage of high-technology exports. The legal factors included the efficiency of the customs clearance index, the number of steps required to build a warehouse, and the time required to fill out the paperwork in the customs clearance process. PESTEL’s criteria were subsequently used in the DEA model via Excel Solver. The VBA macros code allowed the process to be fully automated. Each criterion from PESTEL analysis constituted a specific performance score. As a result, the team uploaded performance scores of the selected countries, which were converted into the average of the resulting performances. Overall, 22 countries in Europe, Asia, and Oceania were analyzed. The top performers were South Korea, Malaysia, and China in Asia, the United Kingdom, Belgium, and France in Europe, and New Zealand and Australia in Oceania. After the comparison with the top-performers in other regions, three countries yielded the best results – Germany, Australia, and China.

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