CHAPTER 9

Question 1

Many services with _______ capacity face wide swings in demand.

This is a problem because service capacity usually cannot be kept aside for _____ at a later date.

Answer 1

limited
sale

Question 2

The effective use of expensive ______________ is one of the secrets of success in such businesses.

The goal should be to utilize staff, labor, equipment, and facilities as productively as possible.

Answer 2

productive capacity

Question 3

By working with managers in operations and human resources, service marketers may be able to develop strategies to bring demand and capacity into _________, in ways that create benefits for _________ and improve ____________ for the business.

Answer 3

balance
customers
profitability

Question 4

This term refers to the resources or assets that a firm can use to create goods and services that are typically key cost components and therefore need to be managed carefully.

Answer 4

PRODUCTIVE SERVICE CAPACITY

Question 5

In a service context, productive capacity can take several forms, including ___________, __________, _______, and _____________.

Answer 5

facilities, equipment, labor, and infrastructure.

Question 6

DEFINING PRODUCTIVE SERVICE CAPACITY

Physical facilities to contain ________

Physical facilities to ____________

Physical equipment to process ________, __________, or _____________.

Answer 6

customers
store or process goods
people, possessions, or information

Question 7

The level of demand exceeds the maximum available capacity, resulting in some customers being denied service and business is lost.

Answer 7

Excess demand

Question 8

optimum capacity. No one is turned away, but conditions are crowded and customers are likely to perceive a deterioration in service quality and may feel dissatisfied.

Answer 8

Demand exceeds

Question 9

are well balanced at the level of optimum capacity. Staff and facilities are busy without being overworked, and customers receive good service without delays.

Answer 9

Demand and supply

Question 10

— Demand is below optimum capacity and productive resources are underutilized, resulting in low productivity

Answer 10

Excess capacity

Question 11

This approach requires an understanding of what constitutes productive capacity and how it may be increased or decreased on an incremental basis.

Answer 11

Adjust the level of capacity to meet demand.

Question 12

This requires a good understanding of demand patterns and drivers on a segment-by-segment basis, so that firms can use marketing strategies to smooth out variations in demand.

Answer 12

Manage the level of demand.

Question 13

Most service firms use a mix of both approaches

_____________
_____________

Answer 13

Adjust the level of capacity to meet demand

Manage the level of demand

Question 14

(ability to absorb extra demand)

The actual capacity level remains unchanged, and more people are being served with the same capacity.

e.g. the normal capacity for a subway car may offer 40 seats and allow standing room
for another 60 passengers with enough handrails and floor space for all.

Answer 14

Elastic Capacity

Question 15

e.g. some banks extend their opening hours during weekdays and even open weekends. Universities may offer evening classes, and weekend and summer
Programs.

Answer 15

Utilize the facilities for longer periods

Question 16

e.g. a restaurant can buzz tables, seat arriving diners and present menus fast, and the bill can be presented promptly to a group of diners relaxing at the table after a meal. In other instances, it may be achieved by cutting back the level of service — say, offering a simpler menu at busy times of the day.

Answer 16

Reduced the average amount of time customers
(or their possessions) spend in the process.

Question 17

To manage demand effectively, firms need to ___________________ and drivers by market segment. Different segments often exhibit different demand patterns (e.g., routine maintenance versus emergency repairs).

Answer 17

understand demand patterns

Question 18

Once firms have an ____________________ of their market segments, they can use marketing strategies to reshape those patterns. To understand the patterns of demand by segment, research should begin by getting some answers to a series of important questions about the patterns of demand and their underlying causes.

Answer 18

understanding of the demand patterns / understand demand patterns

Question 19

ANALYZING DRIVERS OF DEMAND
. Understand why customers from specific market segments _______
this service.

Answer 19

select

Question 20

ANALYZING DRIVERS OF DEMAND

Keep _____________ of transactions to analyze demand patterns.
(Sophisticated software can help track customer consumption patterns.)

Answer 20

good records

Question 21

ANALYZING DRIVERS OF DEMAND

Record ________ conditions and other special factors that might
influence demand.

Answer 21

weather

Question 22

are intended to guarantee that service will be available when the customer wants it.

Answer 22

Reservations

Question 23

_________is something that occurs everywhere.

Answer 23

Waiting

Question 24

Waiting for lines known to operations researchers as “________”

Answer 24

queues

Question 25

________ occur whenever the number of arrivals at a facility exceeds the capacity of the system to process them

Answer 25

Queues

Question 26

An average person may spend up to 30 minutes/day waiting in line equivalent to over a _____________!

Answer 26

week per year

Question 27

It’s boring, time-wasting, and sometimes physically uncomfortable

Almost nobody likes to ______.

Answer 27

wait

Question 28

usually on a first-come, first-served basis, or by offering customers more advanced queuing systems. (e.g., systems that take into account urgency, price, or importance of the customer)

Answer 28

By asking customers to wait in line,

Question 29

______________________ or booking service capacity in advance.

Answer 29

By offering customers the opportunity to reserve

Question 30

FILL INT THE BLANKS:

MANAGING WAITING LINES

1. Rethinking the ______ of the queuing system (i.e., queue configuration and virtual waits)
2. Tailoring the ________ system to different market segments (e.g., by urgency, price, or importance of the customer).
3. Managing customers’ _________ and their _________ of the wait (i.e., use the psychology of waiting to make waits less unpleasant).
4. __________ a reservations system (e.g., use reservations, booking, or appointments to distribute demand).
5. Redesigning processes to _________ the time of each transaction (e.g., by installing self-service machines).

Answer 30

1. design
2. queuing
3. behavior & perceptions
4. Installing
5. shorten

Question 31

Customers proceed and transact through a single serving operation.

Answer 31

Single line single server single stage.

Question 32

Customers proceed through several serving operations. B

ottlenecks may occur at any stage where the process takes longer to execute than at previous stages.

EX. AIRPORT

Answer 32

Single line sequential stages.

Question 33

Offer more than one serving station, allowing customers to select one of several lines in which to wait.

Banks and ticket windows are common examples.

EX. BILLING COUNTER AT MALL

Answer 33

Parallel lines to multiple servers.

Question 34

Commonly known as a “snake.” This type of waiting line solves the problem of parallel lines to multiple servers moving at different speeds.

This method is commonly used at post offices and airport check-ins.

Answer 34

Single line to multiple servers.

Question 35

Involve assigning different lines to specific categories of customers.

Examples include express lines for five items or less and regular lines at supermarket check-outs, and different check-in stations for first class, business class, and economy class airline passengers.

Answer 35

Designated lines.

Question 36

Saves customers the need to stand in a queue. This procedure allows them to sit down and relax, or to guess how long the wait will be and do something else in the meantime

Answer 36

Taking a number.