A new heuristic algorithm is proposed for the P-median problem. The he
uristic restricts the size of the state space of a dynamic programming
algorithm. The approach may be viewed as an extension of the myopic o
r greedy adding algorithm for the P-median model. The approach allows
planners to identify a large number of solutions all of which perform
well with respect to the P-median objective of minimizing the demand w
eighted average distance between customer locations and the nearest of
the P selected facilities. In addition, the results indicate regions
in which it is desirable to locate facilities. Computational results f
rom three test problems are discussed. (C) 1997 Elsevier Science B.V.