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Managing Business Process Flows: Ch 8 Capacity Planning in Services

 Matching Supply and Demand  The Service Process  Performance Measures  Causes of Waiting  Economics of Waiting  Management of Waiting Time  The Sof-Optics Case

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Matching Supply and Demand

 Goods vs. Services – Make to Stock vs. Make to Order – Produce in advance vs. on demand – Safety Inventory vs. Safety Capacity  Examples – Banks (tellers, ATMs, drive-ins) – Fast food restaurants (counters, drive-ins) – Retail (checkout counters) – Airline (reservation, check-in, takeoff, landing, baggage claim) – Hospitals (ER, OR, HMO) – Call centers (telemarketing, help desks, 911 emergency) – Service facilities (repair, job shop, ships/trucks load/unload)

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@MBPF: Principles of Operations Management

The DesiTalk Call Center

The Call Center Process

Incoming Calls (Customer Arrivals) Calls on Hold (Service Inventory) Sales Reps Processing Calls (Service Process) Answered Calls (Customer Departures)

Blocked Calls Abandoned Calls (Due to busy signal) (Due to long waits)

Calls In Process (Due to long waits)

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3

The Service Process

 Customer Inflow (Arrival) Rate (Ri) – Inter-arrival Time = 1 / Ri  Processing Time Tp – Processing Rate per Server = 1/ Tp  Number of Servers (c) – Number of customers that can be processed simultaneously  Total Processing Rate (Capacity) = Rp= c / Tp  Buffer Capacity (K) – Maximum Queue Length

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@MBPF: Principles of Operations Management

Operational Performance Measures

 Flow time T        

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= Ti + Tp Inventory I = Ii + Ip Flow Rate R = Min (Ri, Rp Stable Process = Ri < Rp,,...