Service ops mgt Week7_Session1_Services Management

Service ops mgt Week7_Session1_Services Management -...

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Click to edit Master subtitle style Service Operations Management Instructor: Manpreet Hora Office: Room 4252 Phone: 404-385-3465 Email: manpreet.hora@mgt.gatech.edu
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Agenda ¡ WtA ¡ Capacity management l Revenue management
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Learning Objectives ¡ Describe the strategies for matching capacity and  demand for services. ¡ Recommend an overbooking strategy. ¡ Prepare a work schedule for part-time employees. ¡ Explain what yield management is and how it is 
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Basic Initiating Questions ¡ What is capacity? ¡ What is demand?
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Relating Demand to Capacity: Four Key Concepts ¡ Excess demand : too much demand relative to capacity  at a given time ¡ Excess capacity : too much capacity relative to demand  at a given time ¡ Maximum capacity : upper limit to a firm’s ability to meet  demand at a given time
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Variations in Demand Relative to Capacity VOLUME DEMANDED TIME CYCLE 1 TIME CYCLE 2 Maximum Available Capaci ty Optimum Capacity (Demand and Supply Well Balanced Low Utilization (May Send Bad Signals) Demand exceeds capacity (business is lost) Demand exceeds optimum capacity (quality declines) Excess capacity (wasted resources) CAPACITY UTILIZED
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Alternative Capacity Management Strategies ¡ Level capacity (fixed level at all times) ¡ Chase demand (adjust capacity to match  demand) l How???
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Alternative Capacity Management Strategies ¡ Level capacity (fixed level at all times) ¡ Chase demand (adjust capacity to match  demand) l schedule downtime in low demand periods  l use part-time employees l rent or share extra facilities and equipment l cross-train employees
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Defining Productive Capacity in Services ¡ Physical facilities to contain customers  ¡ Physical facilities to store or process goods  ¡ Physical equipment to process people,  possessions, or information  ¡ Labor used for physical or mental work ¡ Public/private infrastructure—e.g., highways,  airports, electricity 
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Level Capacity and Chase Demand Strategic Dimension Level Capacity Chase Demand Customer Waiting Generally Low Moderate Employee Utilization Moderate High Labor-skill Level High Low Labor Turnover Low High Training Required per Employee
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This note was uploaded on 01/25/2011 for the course MGT 4803 taught by Professor Staff during the Spring '08 term at Georgia Institute of Technology.

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Service ops mgt Week7_Session1_Services Management -...

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