Service MGMT CHAPTER 11
5. Which of the following is not a strategy for managing capacity? A Developing complementary services B Using part-time employees C Forecasting demand D Scheduling shifts
A
1. The strategy of segmenting demand is feasible only when: A demand is not from a homogeneous source. B demand is cyclic and predictable. C arrivals for service are random. D making appointments is impossible.
A
11. Which one of the following is not a strategy to manage demand? A cross-training employees B offering price incentives C developing reservation systems D partitioning demand
A
12. A health club offering a reduced rate membership for students to workout before 4:00 p.m. on weekdays is: A promoting off-peak demand. B partitioning demand. C using yield management. D offering price incentives.
A
18. A restaurant that features special lunchtime combo meals is providing all but one of the following benefits? A Promotes off-peak demand B Increases customer satisfaction C Decreases service times D Segment demand
A
21. ________ is not a strategy for reduction of customer-induced variability. a. Adapt to customer skill levels b. Require reservations c. Limit service breadth d. Target customers based on capability
A
25. When yield management is implemented which one of the following does not result: a. consumer surplus increases b. multiple prices are offered c. capacity is more fully utilized d. market for the service is segmented
A
15. Which one of the following is not an example of the differential pricing policy? A weekend and night rates for long-distance telephone calls B difference in hospital fees for walk-in and scheduled services C peak-load pricing by utility companies D none of the above
B
19. All but one of the following is an example of a yield management application: A RyerFirst B SABRE C HIRO D Restaurant Catering Software
B
17. For a chase demand strategy which of the following does not have a high trade-off? A Employee utilization B Labor-skill level C Labor turnover D Supervision required
B
2. The purpose of differential pricing is to: A make peak period usage unattractive. B make off-peak usage attractive. C charge customers according to their ability to pay. D adjust capacity to demand.
B
24. ________ is not a characteristic appropriate for a yield management strategy. a. Relatively fixed capacity b. Steady demand c. Ability to segment markets d. Products sold in advance
B
3. A good overbooking strategy should: A minimize the expected opportunity cost of idle service capacity. B balance the expected opportunity cost of idle service capacity and expected cost of turning away customers who have reservations. C minimize the expected cost of turning away reservations. D none of the above; services should try to avoid overbooking.
B
8. What one of the following is not a characteristic of yield management? A Capacity is relatively fixed. B There is one homogeneous customer class. C The service is considered a perishable inventory. D Demand fluctuates yet is somewhat predictable.
B
14. Which one of the following is not a characteristic of firms using yield management? A ability to segment their market B perishable inventory C variable capacity D product sold in advance
C
22. ________ is not a strategy for accommodating of customer-induced variability. a. Provide generous staffing b. Cross-train employees c. Reward increased effort d. Do work for customers
C
6. Which of the following strategies is inappropriate for managing capacity and demand? A Smooth customer demand by offering price incentives. B Scheduling staff to meet variations in forecasted customer demand. C Decrease customer participation in the service process. D Promoting off-peak use of facilities.
C
7. A cruise ship has available a certain number of rooms in each of 10 categories of appointments ranging from a two-bunk inside cabin to a suite with an outside patio and indoor sitting area. If a passenger requests a sailing date in which the desired cabin is sold out, which of the following actions would be considered the least viable alternative for the cruise line? A Offer an upgraded cabin at a reduced price. B Attempt to steer the passenger to an available date. C Overbook the cabin. D Offer a downgraded cabin with special privileges such as a $100 certificate for use in the casino.
C
9. Which one of the following four steps in "daily workshift scheduling" is out of order? A Forecast demand. B Convert to operator requirements. C Assign operators to shifts. D Schedule shifts.
C
10. Faced with variable demand and a perishable capacity, a service manager can smooth demand by: A using part-time help during peak hours. B scheduling workshifts to vary workforce needs according to demand. C increasing the customer self-service content of the service. D using reservations and appointments.
D
13. Several approaches to demand management exist, but only _______ seeks to maximize revenue. A promoting off-peak demand B reservation systems C offering price incentives D yield management
D
20. _________ variability is not one of the five sources of customer-induced variability. a. Arrival b. Capability c. Effort d. Demand
D
23. A medical clinic has two doctors and each can treat 25 patients a day. The doctors see walk-in patients whose arrival times cannot be controlled, and also patients who have made appointments. Knowing the expected number of walk-ins per day, appointments are scheduled to utilize the doctors fully. The following table gives the expected number of walk-ins for a particular week: Day:------------------Mon.-----Tue.----Wed.----Th.----Fri. Expected Walk-ins:--45--------35------40-----45-----40 What is the total number of appointments that can be scheduled during this week? A 30 B 35 C 40 D 45
D
4. Bars that offer happy hours in the afternoon are using the strategy of: A creating adjustable capacity. B developing complementary services. C increasing customer participation. D promoting off-peak demand.
D
1. The use of a ski-resort hotel for business conventions during the summer is an example of using the complementary service strategy.
F
11. Time perishability of service capacity is a challenge for service managers because customers demand immediate service.
F
14. An example of segmenting demand is seen when movie theaters offer matinee prices before 6:00 p.m.
F
18. A disadvantage of yield management is that it cannot be implemented in real time.
F
2. Overbooking is a strategy that can be used to smooth demand.
F
20. SABRE is the name for American Airlines' yield management system.
F
22. Level demand and chase capacity are the two generic strategies for capacity management.
F
4. Differential pricing is an attempt to make peak usage periods unattractive by imposing a penalty on the consumer for using the service during peak periods.
F
7. Work shift scheduling attempts to deal with the service utilization problem by controlling the demand for the service and partitioning it so that utilization is uniform.
F
9. When peaks of activity are persistent and predictable such as meal times for restaurants, off-duty personnel can be placed on standby to supplement regular employees.
F
10. Cross training of employees as a strategy to increase flexibility is feasible only when there exist tasks, the demands for which peak at different times.
T
12. Yield management is a pricing and capacity allocation system that was developed by American Airlines.
T
13. Yield management is a strategy that manages both demand and capacity.
T
15. Expected loss for an overbooking reservation strategy would be calculated by multiplying the loss for each no-show possibility and its probability of occurrence, and then adding the products.
T
16. The critical fractile is a cumulative probability of demand.
T
17. Using part-time personnel at fast-food restaurants allows capacity to vary with demand.
T
19. Some restaurants use tables and chairs instead of booths to create more flexible capacity.
T
21. Service capacity is defined in terms of an achievable level of output per unit time.
T
3. The strategy of segmenting demand to reduce variation makes use of the fact that demand for a service seldom is derived from a homogeneous source.
T
5. Yield management is the process of allocating a fixed perishable resource to several market segments in the most profitable manner.
T
6. The work shift-scheduling problem is important in service organizations that face a cyclic demand for their services.
T
8. A drawback to increased consumer participation is the fact that service quality is no longer completely under the control of the provider of the service.
T
