Waiting Line Management: The Managerial Choice Model and the Trade-Off Model

Abstract

Purpose: The purpose of the present study is to develop two alternative waiting line management models―the Managerial Choice model and the Trade-Off Model ― for services marketing/management. There are twelve Ps in services marketing mix. One of them is the management of waiting line of customers who are waiting to receive service from a service provider. Managers of services marketing must efficiently (or at least in a satisficing way) manage this waiting line of customers, given the service delivery/processing time. A short waiting line of customers will decrease customer drop out and, thus, will increase profitability of the organization. A satisfied customer brings many referral customers. On the other hand, a dissatisfied customer, through negative words of mouth, reduces potential new customers. The CRM Multiplier provides a clear idea in this regards. The CRM Multiplier indicates the number of referral customers that an existing satisfied customer in his/her life time brings for the company.
Tools: Both the proposed models have been developed graphically so that students of Services Marketing and service marketers with limited background in mathematics do understand the model clearly.
Importance: The present paper is extremely useful for all types of service organizations, irrespective of the nature of services they provide. Many bank branches, some selected men’s saloons, beauty parlors, and physiotherapy centers in Dhaka City, Bangladesh are using these models. However, the Managerial Choice Model is becoming more popular over time due to its simplicity to implement.
What is New: As mentioned above, the present paper develops two models of customers waiting line management in service marketing/management. The Managerial Choice model is a new model and is not available in literature. The second model―the Trade-Off Model is available in literature but in a different forms. The proposed Trade-Off Model uses a continuum of total customer’s arrivals at a pick time during a day. This continuum is ranging from 0% to 100% so that the service manager can easily choose a point where the total cost of providing services is minimum.