Chapter 11 Waiting line management, after studying this chapter you will be able to: Emphasize the importance of providing fast service as a competitive advantage to companies; show the relationship between customer expectations, customer perceptions, and customer satisfaction as they pertain to waiting time;...
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chapter 11
DAVIS AQUILANO CHASE
PowerPoint Presentation by Charlie Cook
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Chapter Objectives
Chapter Objectives
• Emphasize the importance of providing fast service as
a competitive advantage to companies
• Show the relationship between customer expectations, customer perceptions, and customer satisfaction as they pertain to waiting time
• Identify the various factors that can affect customer
satisfaction with waiting time and provide a framework for showing managers which of these factors are
under their control
• Demonstrate how service managers can design their operations and train their employees to provide faster service without incurring any additional costs
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Chapter Objectives (cont’d)
Chapter Objectives (cont’d)
• Illustrate how technology can assist companies in providing faster service to their customers
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The Importance of Good Service
The Importance of Good Service
• Reasons for Increased Emphasis on Good Service
–Time has become more valuable in highly
developed countries.
–Customer loyalty is significantly impacted by
good service.
–Technological advances have made possible
better and faster service.
–Providing a level of service acceptable to
customers offers a strong competitive
advantage.
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How People Spend Their Time
How People Spend Their Time
Exhibit 11.1
Source: U.S News & World Report, January 30, 1989, p 81.
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Customer Waiting Time versus Process Efficiency: The TradeOff in Waiting Line
Management
Customer Waiting Time versus Process Efficiency: The TradeOff in Waiting Line
Management
• Problems with Waiting Line Management
–Difficult to measure cost of having an external
customer wait.
–Differences in inanimate (in-process) inventory
and actual people waiting for service.
–Overcoming the traditional tradeoff of increased
service costs and customer waiting through
innovation in services.
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The TradeOff in Waiting Line Management
The TradeOff in Waiting Line Management
Exhibit 11.2
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Defining Customer Satisfaction
Defining Customer Satisfaction
• Definition of Customer Satisfaction
–A measure of the customer’s reaction to a
specific service encounter.
• Customer Expectations
–Preconceived notions of what will occur at a
service operation, often influenced by prior
experience, advertising, and word-of-mouth.
–Disconfirmation
• A marketing measure of the difference between the
customer’s expectations from an service operation and a customer’s perception of its performance.
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Defining Customer Satisfaction (cont’d)
Defining Customer Satisfaction (cont’d)
• Actual Waiting Time
–Time, as measured by a stopwatch, of how long
a customer has to wait prior to receiving
service.
• Perceived Waiting Time
–Amount of time customers believe they have
waited prior to receiving service.
–Has a greater effect on customer satisfaction
than actual waiting time.
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Factors Affecting Customer Satisfaction with Waiting
Factors Affecting Customer Satisfaction with Waiting
• Firm-Related Factors
–Unfair versus fair
waits
–Uncomfortable
versus comfortable
waits
–Unexplained versus
explained waits
–Initial versus
subsequent waits
• Customer-Related Factors
–Solo versus group
waits
–Waits for more
valuable versus less valuable services
–Customer value
systems
–Customer’s current
attitude
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The Role of
Satisfaction
in a Customer
Behavior
Model
The Role of
Satisfaction
in a
Customer
Behavior
Model
Exhibit 11.3
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Factors Affecting Customer Satisfaction with Waiting
Factors Affecting Customer Satisfaction with Waiting
• Both Firm and Customer-Related Factors
–Unoccupied versus occupied waits
–Anxious versus calm waits
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A Focus on Providing Fast Service
A Focus on Providing Fast Service
• Service System Design Concepts
–Front-of-the-house
• Portion of the service operation that is in full sight
of the customer.
–Back-of-the-house
• Behind-the-scenes portion of the service operation
with which the customer does not come in contact and can be performed without the presence of the customer.
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A Focus on Providing Fast Service
A Focus on Providing Fast Service
• Service System Design Concepts (cont’d)
–Reduced setup times
• Reducing the time lost when a worker has to
switch from one job function to another.
–Cross-training of employees
• Training employees to perform a variety of tasks
(inventorying skills) increases their flexibility in providing a fast and efficient service operation.
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Why Faster Service is Still “Optimal”
Why Faster Service is Still “Optimal”
Exhibit 11.4
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How Technology Can Provide
Faster Service
How Technology Can Provide
Faster Service
• Eliminate Customer Waiting Time
(24x7 service)
–Automated teller machines (ATMs)
–Internet access to customer accounts
• Reduce Customer Waiting Time
–Bar-code scanners
–Optical character recognition (OCR)
–Menu-driven databases
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The Impact of Technology on Waiting Times and Costs
The Impact of Technology on Waiting Times and Costs
Exhibit 11.5