Last POM class focused on queueing theories, or how to reduce waiting time at the customer while maintaining your costs as low as possible. Turns out that a low utilization factor of your workforce, or equipment, brings both the probability and the duration of waiting down, especially in the unpredictable service industry – where customers usually arrive in a random manner, and where the time needed to process one enquiry can vary greatly from customer to customer. Highly logical, if you are sitting idle, you’d be ready to help any incoming customer at any time.

Predictability makes it a lot easier to size the labor or machine requirements, in order to service properly customer demand. Two variability factors were introduced: arrival time of customers (or request) and service time.
In order to try to smooth out arrival times and avoid big burst of activity, a few tricks are available to managers. Here are some examples:
- schedule appointments (hairdressers)
- Develop incentives to help customer self select themselves: higher prices during peak hours, high season, etc…(used in Singapore to regulate traffic, based on simple supply and demand curves)
- be clear about waiting time: customers who do not value the solution to their problems as much as the waiting time will leave the queue, better assess the urgency of the request, etc...(used in help desk phone lines)

If the burst is predictable and its size can be estimated, peak load planning is possible.

In order to reduce unpredictability in service time
- when scheduling, ask more information about the problem (used in health services) to better assess appointment time (used by dentists’)
- develop knowledge about customer problem, use of equipment before processing the request. This has the added benefit that you can better design your next product and are more likely to secure the sale.
- collect historical data about processing time and develop forecast model
- introduce a triage system: people with standardized problem can be treated in a predictable way, leaving more time for unusual problems (often used in call centers)
- Standardize processes

Finally, if customers do have to wait, make it nice for them (Universal Studio theme park has video monitor to entertain their customers standing in line).

This concept was brilliantly illustrated by the long, gigantic, infinite line in front of the Viennese Pastries booth. Two people, one table serving 320 x 2 students, and that’s excluding partners.

It was also a good example of inventory management and customer’s perception. I was about to select my choice, a much awaited event when the Austrian team briefly assessing the number of customers fell victim of their success. It realized that it might be short of food and cut all the portions in half in front of my eyes. This has a much higher psychological impact than just knowing that you are being served half portion.
I once read about a study conducted at various airports. It showed that people who can see the plane that they have just missed by 1 sec take off in front of their eyes are much more disappointed than the people who cannot, who are likely to just shrug their shoulders and move on.