CHAPTER 18: MANAGEMENT OF WAITING LINES

I. INTRODUCTION

Waiting is already part of people’s daily lives wherein it cannot be avoided but

it can be minimized. As cited from dictionary, waiting is the action of staying

where one is or delaying action until a particular time or until something else

happens. In business, waiting line is the most visible kind of waiting you can

observe. In customer’s perspective, waiting line is just a waste of time and in,

manager’s perspective; it is only an additional expense. Since it add to the cost

of business operations, managers tend to think of different strategy on how they

can deal with this and there are theories or model that being used in analyzing

waiting lines.

The mission of one’s business is to entertain and meet the expectation of the

customers. Having waiting lines does not add to the enjoyment and satisfaction

of the customers they have and it also does not add to generating revenue but

rather it only adds additional cost to the business operations. Therefore, it is

important for a business to appreciate the impact of waiting lines and how they

can reduce it. If strategies were made for customers not to wait in line, this will

bring a win-win situation; customers are happier because their time will not be

wasted in waiting and the revenue of the business will increased.

In this paper, different terminologies regarding waiting lines will be discussed,

different models will be presented in analyzing waiting lines and how to manage

waiting lines will also be tackled.

 II. OBJECTIVES

After completing this chapter you should be able to:

a. Familiarized with the waiting line terminology

b. Solve typical problems using models presented in this chapter

c. And answer these following questions:

1. What imbalance does the existence of a waiting line reveal?

2. What causes waiting lines to form and why is it possible to

eliminate them completely?

3. What metrics are used to help managers analyze waiting lines?

4. What are some psychological approaches to managing waiting

lines and why might a manager want to use them?

5. What very important lesson does the constant service time

model provide for managers?

III. CONTENT

WAITING LINES

Waiting lines occur when there is a temporary imbalance between supply

(capacity) and demand. It is when one or more customers wait for the service. In

waiting lines, it is not only person who can be observed but also objects such as

machines waiting for maintenance, sales orders waiting to be processed or

shipped, or materials in inventory waiting to be used. Waiting lines add to the

cost of operation and they reflect negatively on customer service, so it is

important to balance the cost of having customers wait with the cost of providing

service capacity. According to Belbel and Abdo (2018), waiting line problems

exist because the demand patterns are irregular or random and service times

vary among customers. Most often, the rate of producing the service also varies

depending upon customer needs. For example, a fast food restaurant can

accommodate 200 orders per hour and the arrival rate of customers is 150 per

hour and yet they experience waiting line because the arrival of customers vary

throughout the day and the processing of order depends on customer’s needs;

some orders take longer to be processed than the others.

Waiting lines affects different

QUEUING THEORY

Queuing theory is a mathematical approach used by operations manager

in analysis of waiting lines. It is directly applicable to wide range of service

operations including call centers, banks, post offices, restaurants, theme parks,

and telecommunication system and traffic management. The objective of queuing

analysis is to minimize customer waiting and service capacity cost. With this,

managers try to strike a balance between efficiently utilizing resources and

keeping customer satisfaction high. There are also other costs associated with

waiting lines, such as loss of business due to customers leaving and refusing to

wait, or loss of reputation.

The foundation of modern queuing theory is based on studies about

automatic dialing equipment made in the early part of the 20th century by Danish
telephone engineer A.K. Erlang. It stated with a formula which is derived from

telephone calls. The Erlang C formula is a mathematical equation for calculating

the number of agents (advisors) that you need in a call centre, given the number

of calls and the service level that you want to achieve.The Erlang C formula is

the most important part of the equation. It allows you to work out the probability

that a call waits (Pw), given the Traffic Intensity (A) and the Number of Agents (N)

available (Call Centre Help, 2018).

MANAGERIAL IMPLICATIONS OF WAITING LINES

Managers have a number of very good reasons to be concerned with

waiting lines. Chief among those reasons are the following:

1. cost to provide waiting space

2. possible loss of business: should customers leave the line before being

served or refuse to wait at all

3. possible loss of goodwill

4. possible reduction in customer’s satisfaction

5. resulting congestion that may disrupt other business operations or

customers
 IV. SYNTHESIS/EVALUATION

V. REFERENCES

call centre help. (2018, january 10). Retrieved from

https://www.callcentrehelper.com/erlang-c-formula-example-121281.htm