Spoke-hub distribution paradigm

The hub-and-spoke distribution paradigm (or model or network) is a system of connections arranged like a chariot wheel, in which all traffic moves along "spokes" connected to the "hub" at the center. The model is commonly used in industry, in particular in transport, telecommunications and freight, as well as in distributed computing.

Analysis of the model

The hub-and-spoke model is most frequently compared to the point-to-point transit model.

Benefits

* For a network of "n" nodes, only "n" - 1 routes are necessary to connect all nodes; that is, the upper bound is "n" - 1, and the complexity is O("n"). This compares favorably to the ("n"("n" - 1))/2 routes, or O("n"²), that would be required to connect each node to every other node in a point-to-point network.

* The small number of routes generally leads to more efficient use of transportation resources. For example, aircraft are more likely to fly at full capacity, and can often fly routes more than once a day.

* Complicated operations, such as package sorting and accounting, can be carried out at the hub, rather than at every node.

* Spokes are simple, and new ones can be created easily.

* Customers may find the network more intuitive. Scheduling is convenient for them since there are few routes, with frequent service.

Drawbacks

* Because model is centralized, day-to-day operations may be relatively inflexible. Changes at the hub, or even in a single route, could have unexpected consequences throughout the network. It may be difficult or impossible to handle occasional periods of high demand between two spokes.

* Route scheduling is complicated for the network operator. Scarce resources must be used carefully to avoid starving the hub. Careful traffic analysis and precise timing are required to keep the hub operating efficiently.

* The hub constitutes a bottleneck in the network. Total cargo capacity of the network is limited by the hub's capacity. Delays at the hub (caused, for example, by bad weather conditions) can result in delays throughout the network. Delays at a spoke (from mechanical problems with an airplane, for example) can also affect the network.

* Cargo must pass through the hub before reaching its destination, requiring longer journeys than direct point-to-point trips. This is often desirable for freight, which can benefit from sorting and consolidating operations at the hub, but not for time-critical cargo and passengers.

Commercial aviation

In 1955 Delta Air Lines pioneered the hub and spoke system at its hub in Atlanta, Georgia [http://www.delta.com/about_delta/corporate_information/delta_stats_facts/delta_through_decades/index.jsp] , in an effort to compete with Eastern Air Lines. In the mid-1970s FedEx adopted the hub and spoke model for overnight package delivery, and after the airline industry was deregulated in 1978, Delta's hub and spoke paradigm was annexed by several airlines.

Airlines have extended the hub-and-spoke model in various ways. One method is to create additional hubs on a regional basis, and to create major routes between the hubs. This reduces the need to travel long distances between nodes that are close together. Another method is to use focus cities to implement point-to-point service for high traffic routes, bypassing the hub entirely.

Industrial distribution

The hub-and-spoke model has also been used in economic geography theory to classify a particular type of industrial district. Ann Markusen, an economic geographer, theorised about industrial districts, where a number of key industrial firms and facilities act as a hub, with associated businesses and suppliers benefiting from their presence and arranged around them like the spokes of a wheel. The chief characteristic of such hub-and-spoke industrial districts is the importance of one or more large companies, usually in one industrial sector, surrounded by smaller, associated businesses. Examples of cities with such districts include Seattle (where Boeing is located) and Toyota City, with Toyota.

References

* Babcock, B. A., 2002, "Making Sense of Cities: A Geographical Survey", London: Arnold, pp. 63–94.

* Lawrence, H., 2004, "Aviation and the Role of Government", pp. 227-230.

* Markusen, A., 1996, "Sticky Places in Slippery Space: A Typology of Industrial Districts", in "Economic Geography", 72: 293–313.

ee also

Hubs and Nodes